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https://www.courtlistener.com/api/rest/v3/opinions/458788/ | 773 F.2d 1216
227 U.S.P.Q. 90
In re Robert L. LUNDAK.
Appeal No. 85-887.
United States Court of Appeals,Federal Circuit.
Sept. 16, 1985.
Bertram I. Rowland, Townsend & Townsend, San Francisco, Cal., argued for appellant.
Harris A. Pitlick, Associate Sol., U.S. Patent & Trademark Office, Arlington, Va., argued for appellee. With him on the brief were Joseph F. Nakamura, Sol. and John W. Dewhirst, Associate Sol., Washington, D.C.
Before MARKEY, Chief Judge, BENNETT, and NEWMAN, Circuit Judges.
PAULINE NEWMAN, Circuit Judge.
1
This appeal concerns the administrative rule of the United States Patent and Trademark Office (PTO) whereby an inventor in the field of microbiology is required to deposit a sample of relevant biological materials with an independent depository on or before the date the inventor files a patent application. Such deposit requirement applies only to biological materials that are not readily reproducible from their written description.
2
The PTO Board of Appeals affirmed the examiner's rejection of claims 1 and 2 of patent application Serial No. 247,656 entitled "High Fusion Frequency Fusible Lymphoblastoid Cell Line", invention of Robert L. Lundak, for failure to meet the requirements of 35 U.S.C. Sec. 112, first paragraph, due to Lundak's failure to make such deposit on or before his filing date. A deposit seven days after the filing date was held not to cure the deficiency. The PTO also refused to change Lundak's filing date to the date of the deposit.
Background
3
The appealed claims are directed to a new human cell line and the hybridomas resulting from its fusion with lymphoid cells. These hybridomas are useful to secrete immunoglobulins derived from the cell line, in turn useful for diagnostic and therapeutic purposes. Claims 1 and 2 are as follows:
4
1. An immortal B-cell line WI-L2-729HF 2 .2. A hybridoma resulting from the fusion of an immunized lymphocyte and a cell line according to Claim 1.
5
The new cell line was developed by mutagenesis and selection from a known cell line, by procedures that fill twelve pages of Lundak's specification, and include experimental details such as the following:
EXPERIMENTAL
6
A HAT-medium sensitive mutant cell line was obtained by subjecting the known human lymphoblastoid B-cell line WI-L2 to increasing concentrations of 6-thioguanine and isolating mutants resistant to 6-thioguanine. A thioguanine-resistant clone was isolated and designated UC 729-6. The UC 729-6 cells are routinely grown in RPMI 1640 media supplemented with 10% FCS, 2mM glutamine and 10-4M 6-thioguanine. UC 729-6 doubles in concentration every 17 hours.
7
The above cells were then grown at very high densities, approximately 1-1.5 X 117 [sic] cell/ml and at this high confluent density, the cells were shifted slowly into ever-decreasing concentrations of fetal calf serum. The concentration of fetal calf serum was decreased by 2% each week from the original 15% and the cells were seeded at high densities i.e. 5 X 106 cells per transfer. Following four months of successive transfers, the cells grew on 2% FCS in Iscove's synthetic medium (Iscove and Melchers, supra ), but not in Iscove's synthetic medium by itself.
8
Iscove's media was conditioned with growing mouse peritoneal fibroblasts in the presence of about 10ug insulin. Monolayers of mouse fibroblasts in their second or third doubling (in some cases as much as five doublings, but not greater), were incubated with Iscove's synthetic media for 24 hours. This conditioned media was then used 50-50 with normal Iscove's media to shift the modified 729 cells into serum-free conditions. Out of about 50 flasks of cells, one flask developed qualities that would grow in Iscove's serum-free media and that cell line was continued. These cells showed no improvement in fusion frequency.
9
These cells were cloned out to limiting dilutions so that each population was an expansion of a single cell. Each of these populations (approximately 900) were grown into colonies of approximately 5 X 107 cells and these cells were fused with human lymphocytes in a procedure using polyethylene glycol 1000 elevated to pH8.2 and containing 15% dimethylsulfoxide and incubated at 27?C for 8.5 minutes. [and so on]
10
Because of the uncertainties of reproducibility that inhere in such processes, at least in the present state of biotechnology, this invention is of the class covered by the deposit requirement. Robert Lundak, a professor at the University of California, filed an application for patent on March 26, 1981, apparently in the belief that samples of his new cell line had been deposited with the American Type Culture Collection (ATCC), a recognized depository for biological materials. However, this deposit was not made until April 2, 1981.
11
The examiner cited no prior art, but rejected Lundak's claims under 35 U.S.C. Sec. 112, first paragraph, as nonenabling for failure to meet the criteria of Manual of Patent Examining Procedure (MPEP) Sec. 608.01(p)C, as follows:
C. DEPOSIT OF MICROORGANISMS
12
Some inventions which are the subject of patent applications depend on the use of microorganisms which must be described in the specification in accordance with 35 U.S.C. 112. No problem exists when the microorganisms used are known and readily available to the public. When the invention depends on the use of a microorganism which is not so known and readily available, applicants must take additional steps to comply with the requirements of Sec. 112.
13
In re Argoudelis, et al., [434 F.2d 1390] 168 USPQ 99 (CCPA, 1970), accepted a procedure for meeting the requirements of 35 U.S.C. 112. Accordingly, the Patent and Trademark Office will accept the following as complying with the requirements of Sec. 112 for an adequate disclosure of the microorganism required to carry out the invention:
14
(1) the applicant, no later than the effective U.S. filing date of the application, has made a deposit of a culture of the microorganism in a depository affording permanence of the deposit and ready accesibility [sic] thereto by the public if a patent is granted, under conditions which assure (a) that access to the culture will be available during pendency of the patent application to one determined by the Commissioner to be entitled thereto under 37 CFR 1.14 and 35 U.S.C. 122, and (b) that all restrictions on the availability to the public of the culture so deposited will be irrevocably removed upon the granting of the patent;
15
(2) such deposit is referred to in the body of the specification as filed and is identified by deposit number, name and address of the depository, and the taxonomic description to the extent available is included in the specification; and
16
(3) the applicant or his assigns has provided assurance of permanent availability of the culture to the public through a depository meeting the requirements of (1). Such assurance may be in the form of an averment under oath or by declaration by the applicant to this effect.
17
A copy of the applicant's contract with the depository may be required by the examiner to be made of record as evidence of making the culture available under the conditions stated above.
18
In exchanges between Lundak and the ATCC, and Lundak and the examiner, Lundak eventually established to the examiner's satisfaction that the deposit would be maintained for at least thirty years, for which the entire fee was required (by ATCC as well as by the PTO) to be paid in advance, and that the deposit would be replaced by Lundak as necessary to assure its viability. The criteria of MPEP Sec. 608.01(p)C were then deemed satisfied except for the unalterable fact that the deposit had been made seven days after the patent application was filed.
19
Lundak sought relief first by petition to the Commissioner, to change his filing date from March 26, 1981 to April 2, 1981. The Commissioner denied the petition, stating that there was no indication that the application was not complete as of March 26, 1981 "for the purposes of having a filing date accorded thereto".
20
Lundak duly appealed the examiner's rejection under section 112 to the Board of Appeals, arguing inter alia that he had deposited the cell line with colleagues at the University of California and elsewhere. Sitting in an expanded panel, the Board affirmed the rejection. In its opinion, joined by twelve of the eighteen members of the panel, the Board held that Lundak's deposit of the cell line at university laboratories was inadequate to meet the legal requirements because they were not "recognized depositories" which could guarantee permanent availability. The Board also stated that such deposit would not meet the terms of the Budapest Treaty on the International Recognition of the Deposit of Microorganisms for the Purposes of Patent Procedure, April 28, 1977, 32 U.S.T. 1241, T.I.A.S. No. 9768, to which the United States is a signatory, because inter alia the academic institutions had not agreed to maintain the cultures for the required period.
21
The Board also held1 that Lundak's deposit made with the ATCC after his filing date could not overcome the section 112 rejection because this deposit was "new matter", proscribed by 35 U.S.C. Sec. 132.
22
The Board's opinion was accompanied by two concurring opinions. Four Board members affirmed the rejection on the ground that Lundak had failed to overcome a prima facie case of non-enablement. In their view a failure to deposit the biological material with an independent depository on or before the filing date should not be fatal, since this is not the sole means by which evidence of enablement can be presented. They would have allowed Lundak to present additional evidence of the existence of this cell line at the time of his filing date, to overcome the rejection under section 112.
23
Two other concurring Board members observed that based on Feldman v. Aunstrup, 517 F.2d 1351, 186 USPQ 108 (CCPA 1975), cert. denied, 424 U.S. 912, 96 S.Ct. 1109, 47 L.Ed.2d 316, 188 USPQ 720 (1976), an applicant must meet two conditions in order to comply with section 112. First, the PTO must be assured of access to the microorganism during pendency, as required by 35 U.S.C. Sec. 114; and second, the public must be assured of access to the material after issuance of the patent. These Board members observed that the first condition was met by Lundak's statement concerning his possession and retention of the cell line at the university. The second condition, that the cell line be permanently available to the public after patent grant, in their view had not been met because Lundak had not proven that the material deposited with the ATCC was the same as the material "in his possession on March 26, 1981".
24
On reconsideration, the Board noted that Lundak had clarified the terms of his deposit with ATCC; the Board was now satisfied that the deposit conformed with the requirements of MPEP Sec. 608.01(p)C relating to the term and conditions under which it would be maintained. The Board adhered to its decision on all other grounds.2
25
Lundak sought alternative relief in this court: from the Commissioner's decision refusing to change the filing date, by an action in the nature of mandamus pursuant to 28 U.S.C. Sec. 1651; and by appeal from the Board's decision holding the original filing to be non-enabling under 35 U.S.C. Sec. 112. On determining that these actions arose from the same set of facts, the substance of the mandamus action was consolidated into the appeal by our order of March 20, 1985.
Analysis
A.
26
Section 112, first paragraph, requires that the written description in the specification enable any person with skill in the pertinent art to make and use the claimed invention. Compliance with section 112 is negated if undue experimentation is needed because of an inadequate or incomplete description. W.L. Gore & Assocs., Inc. v. Garlock, Inc., 721 F.2d 1540, 1557, 220 USPQ 303, 316 (Fed.Cir.1983), cert. denied, --- U.S. ----, 105 S.Ct. 172, 83 L.Ed.2d 107 (1984); In re Strahilevitz, 668 F.2d 1229, 1232, 212 USPQ 561, 563-64 (CCPA 1982).
27
When an invention relates to a new biological material, the material may not be reproducible even when detailed procedures and a complete taxonomic description are included in the specification. Thus the then Patent Office established the requirement that physical samples of such materials be made available to the public, as a condition of the patent grant. See Levy & Wendt, "Microbiology and a Standard Format for Infra-Red Absorption Spectra in Antibiotic Patent Applications", 37 J.Pat.Off.Soc'y 855 (1955).
28
The Court of Customs and Patent Appeals considered this requirement in In re Argoudelis, 434 F.2d 1390, 168 USPQ 99 (CCPA 1970). Argoudelis had deposited his biological material with a Department of Agriculture depository prior to filing his patent application, but had restricted access to the deposit during the pendency of the patent application to persons authorized by the patent applicant. Upon issuance of the patent, access was to be unrestricted. On the question of whether Argoudelis' deposit made his disclosure enabling despite the restriction on public access prior to grant of the patent, the court endorsed the procedures followed by Argoudelis. See MPEP Sec. 608.01(p)C, supra.
29
In 1975 the court elaborated on the role of deposits in connection with the requirements of section 112 in Feldman v. Aunstrup, supra. Aunstrup, the senior party in an interference, had deposited samples of his microbiological material at a private, recognized depository in the Netherlands prior to his filing date, specifying that the deposit was to be made available only to Aunstrup's designees. Aunstrup removed all restrictions on the deposit twenty-eight months after filing his U.S. patent application. Feldman, the junior party, contended that the terms of Aunstrup's deposit in the Netherlands failed to assure availability of the sample to the PTO during pendency of the application and to the public upon issuance of the patent, as required by Argoudelis. Feldman, 517 F.2d at 1352-53, 186 USPQ at 110-11.
30
The Feldman court, affirming the Board of Patent Interferences, held that under 35 U.S.C. Sec. 114 and 37 C.F.R. Sec. 1.93 "there is no question that the PTO could obtain access to [the deposit] through Aunstrup at any time during pendency" of the application. Id. at 1354, 186 USPQ at 112. As for assuring public access, the court affirmed that although Argoudelis had placed his microorganism in a public depository in the United States, it was not fatal that Aunstrup had followed a somewhat different procedure:
31
[T]he enablement requirement of Sec. 112, first paragraph, does not require such assured access to a microorganism deposit as of the filing date; what is required is assurance of access (to the microorganism culture by the public upon issuance of a patent on the application) prior to or during the pendency of the application, so that, upon issuance of a U.S. patent on the application, "the public will, in fact, receive something in return for the patent grant." In re Argoudelis, 434 F.2d at 1394, 58 CCPA at 776 (Baldwin, J., concurring).
32
Id. at 1355, 186 USPQ at 112-13. The court held that Aunstrup's deposit in the Netherlands was adequate for these purposes despite the private nature of the depository and its foreign location, and that the controlling criteria were the permanent availability of the culture and assurance of access upon issuance of the patent. Id. at 1355, 186 USPQ at 112.
33
Analyzing 35 U.S.C. Sec. 112, the Feldman court held that the factors enumerated in Argoudelis were not "mandatory for a sufficient specification", and that "the so-called 'second aspect' or second function of Sec. 112, first paragraph--that of establishing the application filing date as the prima facie date of invention--was satisfied by Aunstrup's specification." 517 F.2d at 1355, 186 USPQ at 112-13. The court stated "the invention recited in the count and described in the application was fully capable of being reduced to practice (i.e., no technological problems, the resolution of which would require more than ordinary skill and reasonable time, remained in order to obtain an operative, useful process)." Id. at 1355, 186 USPQ at 113. That is, the court concluded that Aunstrup's specification was sufficient for constructive reduction to practice.
34
The Argoudelis and Feldman decisions recognized the salutary purposes of the system of deposit of biological samples from the perspectives of the inventor, the PTO in fulfilling its duty to administer the patent statute, and the public. These decisions support the reasonableness of the PTO's procedures. Accordingly, MPEP Sec. 608.01(p)C does not specify whether the deposit be in a private or public depository, or in the United States or a foreign country. Its requirement that the deposited culture be available to the PTO during the pendency of the patent application is, as established in Feldman, satisfied by compliance with a request from the PTO to the applicant.
35
We see no controlling distinction between the PTO's mode of access to Aunstrup's deposit in the Netherlands or Argoudelis' in the United States, and to Lundak's cell line at the University of California. In each case, the PTO would proceed by request to the inventor. This is the long-standing procedure of 35 U.S.C. Sec. 114:
Sec. 114. Models, specimens
36
The Commissioner may require the applicant to furnish a model of convenient size to exhibit advantageously the several parts of his invention.
37
When the invention relates to a composition of matter, the Commissioner may require the applicant to furnish specimens or ingredients for the purpose of inspection or experiment.
38
On the basis of this precedent, Lundak's deposit in his laboratory or in the laboratories of colleagues suffices to meet the requirements of 35 U.S.C. Secs. 112 and 114 as they apply to pending patent applications. The PTO has the statutory right to request "specimens or ingredients" from the applicant. It is not material whether this request is filled directly by the applicant, or on the instructions of the applicant by a third person to whom the applicant has entrusted the specimen.
39
With respect to assurance of availability of the material to the public after the grant of the patent, the Board held, in its decision on reconsideration, that the terms of Lundak's ATCC deposit now satisfy the preservation and public disclosure requirements and that this is "no longer an issue in this appeal".
40
We conclude that 35 U.S.C. Sec. 112, first paragraph, does not require the transfer of a sample of the invention to an independent depository prior to the filing date of the patent application. The requirements of PTO access to a sample of Lundak's cell line during pendency, and public access after grant, were met by Lundak's procedures. Lundak's deposit with the ATCC, which was made after filing but prior to issuance of his patent, and which is referred to in his specification, meets the statutory requirements.
B.
41
The PTO also argues that a pre-filing deposit with an independent depository, referred to in the specification at the time of filing, is essential to ensure that the disclosure is enabling as of the filing date, which in turn is required so that the filing date may be taken as the date of constructive reduction to practice. The PTO asserts that a post-filing deposit is barred as "new matter", as is the insertion into the specification of reference to such deposit.
42
The PTO relies on In re Glass, 492 F.2d 1228, 181 USPQ 31 (CCPA 1974), which ruled that Glass could not supplement his disclosure after filing by referring to publications that became available after his filing date. The court held that "[t]he sufficiency [of the disclosure] must be judged as of the filing date", id. at 1228, 181 USPQ at 34, and set forth two rationales supporting this holding. First, that "35 U.S.C. 132 prohibits adding any 'new matter' to the disclosure after filing." Second, that "the filing date becomes a date of constructive reduction to practice in determining priority of invention and this should not be the case unless at that time, without waiting for subsequent disclosures, any person skilled in the art could practice the invention from the disclosure of the application." Id.
43
The Solicitor argues that to achieve constructive reduction to practice the deposit must be made before filing and incorporated by written reference into the specification as filed, and lacking this the specification is fatally and incurably flawed. Lundak's specification did not identify the actual location of a sample at the time of filing, although it did name the ATCC as the intended location of the sample.
44
As we consider this question we look first to the statute. 35 U.S.C. Sec. 112 states that the specification must contain a "written description" which must "enable" the practice of the invention by others. The examination for patentability proceeds solely on the basis of the written description. From the examination standpoint, completeness of Lundak's written description was conceded.3 Although a sample is not a written description, Feldman established that the availability of a sample to the public after the patent has issued will meet the enablement requirement. On point is In re Hawkins, 486 F.2d 569, 574, 179 USPQ 157, 161 (CCPA 1973), wherein the court observed that:
45
In Argoudelis, we rejected the board's proposition that section 111 of the statute requires that the specification must be enabling as filed. We again reject it.... [T]he function of section 112 in ensuring complete public disclosure is only violated if the disclosure is not complete at the time it is made public, i.e., at the issue date. (citations omitted).
46
Hawkins dealt with the question of new matter, wherein the enabling information added was the full text of previously referenced British patent applications. See also White Consolidated Industries, Inc. v. Vega Servo-Control, Inc., 713 F.2d 788, 218 USPQ 961 (Fed.Cir.1983), wherein an essential element of the invention was not disclosed, but was kept as a trade secret during pendency and after issuance of the patent. The court held that the disclosure was not enabling as filed, i.e., not fully capable of being reduced to practice, see Feldman, supra. In White Consolidated there was no attempt to add the information, as in Hawkins, and White Consolidated did not consider whether such information would have been new matter under the facts of the case. In Lundak's case, the PTO argues that both the deposit and its accession number are new matter.
47
Argoudelis, Feldman, and related precedent make clear that the requirements for constructive reduction to practice were met on filing their patent applications, and we have today held that it is not material whether a sample of Lundak's cell line resided in his hands or in the hands of an independent depository as of his filing date. An accession number and deposit date add nothing to the written description of the invention. They do not enlarge or limit the disclosure. This is not the shape of new matter against which section 132 was designed to guard.
48
Constructive reduction to practice does not turn on the question of who has possession of a sample, and thus it does not turn on the inclusion or absence, in the specification as filed, of the name and address of who will have possession of the sample on grant of the patent.
49
We conclude that Lundak's specification as filed met the requirements of constructive reduction to practice, and that the insertion of depository data after filing is not new matter under 35 U.S.C. Sec. 132.
C.
50
Both parties raised a number of additional points, all of which have been considered. We comment only on the PTO argument that failure to require a deposit with an independent depository before filing may lead to sham patent applications. We take note of how easily such a supposed safeguard could be subverted by the dishonest, while being unnecessary to the honest: the deposit required by MPEP Sec. 608.01(p)C is not made with the PTO or its designee, but with a third person, perhaps in a foreign country; the examiner must rely solely on the inventor's documentation; the sample in no way aids the patent examination, which is based on the written description in the specification. There is no greater or less risk of dishonesty in this procedure than in any other.
Conclusion
51
The Board's decision upholding the rejection of Lundak's patent application for failure to comply with 35 U.S.C. Sec. 112, first paragraph, is reversed.
REVERSED
1
In support of its decision the Board stated that "[t]he PTO's interpretation of the statute is for the microbiologist's express benefit." We commend the concern reflected in this statement, and observe that it is the public interest in the progress of the useful arts that is benefitted as new technologies evolve. An interpretation of the statute to deny patent rights in microbiological inventions would be contrary to law. Diamond v. Chakrabarty, 447 U.S. 303, 309, 100 S.Ct. 2204, 2207, 65 L.Ed.2d 144, 206 USPQ 193, 197 (1980), established that "respondent's micro-organism plainly qualifies as patentable subject matter." As the Court said, quoting Thomas Jefferson, "ingenuity should receive a liberal encouragement." Id. at 308, 100 S.Ct. at 2207, 206 USPQ at 197. The PTO must continue to adapt its procedures to facilitate the advance of science and technology
2
The Commissioner no longer relies on the Board's concern for compliance with the Budapest Treaty. The Budapest Treaty sets up minimum requirements for maintaining an international depository for microorganisms. As explained by then Commissioner Diamond at 999 O.G. 2 (October 7, 1980), "[e]ach such depository will be authorized to receive and store deposits, and dispense samples thereof, in compliance with the Treaty and the patent laws of each State adhering thereto." That is, individual patent applications are governed by the national patent laws
3
The Commissioner insists that Lundak's specification was adequate for examination purposes when filed, even as he insists that Lundak's specification was fatally flawed for lack of the deposit. If so flawed, then in our view it should not have been accepted for examination or given a filing date, see 37 C.F.R. Sec. 1.53, and Lundak's alternative plea for relief should have been granted. However, we need not reach this issue | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1580608/ | 59 N.W.2d 548 (1953)
BITTERMAN
v.
REINFELD et al.
No. 9355.
Supreme Court of South Dakota.
June 25, 1953.
Danforth, Bleeker & Carlson, Mitchell, Wm. H. Glynn, Parkston, for plaintiff and appellant.
Stewart Sharpe, Delmont, L. E. Navin, Mitchell, for defendants and respondents.
SICKEL, Judge.
This is an action in claim and delivery. On February 6, 1948, Ferdinand G. Bitterman, the plaintiff, and Grant Reinfeld and Ray Reinfeld, defendants, entered into a written contract whereby plaintiff agreed to leave with defendants 37 head of cattle. It was provided by the agreement that all the calves were to be kept by defendants until they attained the weight of 600 pounds, when settlement was to be made on a fifty-fifty basis. The term of the contract expired on December 24, 1948. On the expiration of the term the parties continued to operate under the contract until December 24, 1950. Prior thereto and on December 14, 1950, plaintiff notified defendants that the contract would be terminated on December 24, 1950, unless a new contract should be made. The parties were unable to agree on the terms of a new contract, as demanded by plaintiff, and thereupon plaintiff demanded the return of the cattle with one-half of the calves. Full settlement, including the division of the calves, was made between the parties as of December 24, 1950. Thereafter the cattle were left with defendants until April 18, 1951, during which time negotiations for a new contract were carried on. Also during this period defendants kept the cattle as before and 17 additional calves were born to the cows. On April 18, 1951, plaintiff commenced proceedings in claim *549 and delivery and the sheriff took into his possession 46 head of cattle and 17 calves, and delivered them to plaintiff. Plaintiff based his right to possession upon the claim of ownership to all the cows and all of the 17 calves. Defendants answered alleging that the transaction constituted a joint adventure which had not been terminated or settled, and that therefore plaintiff was wrongfully in exclusive possession of the cattle. Defendants also alleged a counterclaim for keeping the cattle during the year in which they had no calves, in the amount of $200; for overweight on one steer, $15; overweight on 9 head of cattle, $201; personal taxes paid by defendants, $133.68; a half interest in the 17 calves born after December 24, 1950, $637.50; care of 16 cows with calf, $800; veterinary fees paid by defendants, $125.
The court decided that the original written agreement was continued by mutual consent of the parties for an additional term of two years, and that the parties had a full settlement according to contract for the entire term of its operation to December 24, 1950; that the defendants were the owners of an undivided one-half interest in the 17 calves born after December 24, 1950, and before the seizure in claim and delivery. The judgment awarded the plaintiff possession of all the cows and half of the 17 calves and awarded defendants the other half of the 17 calves or their value in the sum of $552.50. Plaintiff appealed, but there is no cross-appeal by defendants. The only issue presented on this appeal is whether the court erred in awarding to defendants a half interest in the 17 calves born after December 24, 1950, or their value.
The circuit court found that at a pretrial conference the parties stipulated that the contract created a joint enterprise as to the increase of the cattle, and decided that, by reason of the conduct of the parties, the contract was in full force and effect until the time of seizure. While the plaintiff does not dispute the stipulation he says that the court erred in concluding that the contract created a joint enterprise "* * * for the reason that the contract itself was a contract of bailment and under the law must be treated as such regardless of what the findings were or regardless of what the parties may have indicated at a pre-trial conference * * *".
The above stipulation related to the legal effect of a contract, the legal conclusion to be drawn from a state of facts. It was upon a question of law which must be decided by the court, uninfluenced by stipulation of the parties or counsel. Luce v. Ash, 28 S.D. 109, 132 N.W. 708, 60 C.J., Stipulations, § 23; cf. Englund v. Berg, 69 S.D. 211, 8 N.W.2d 861. The legal principles applicable to the facts established at the trial must be applied regardless of any stipulation as to the law of the case that may have been entered into by the parties.
The agreement signed by the parties and the evidence of what was done in pursuance of it "* * * clearly point to a bailmenta trust relation arising from lawful possession of property taken with consent of the owner for an agreed time and purpose, and the duty to later account for it to the owner". Edgar v. Parsell, 184 Mich. 522, 151 N.W. 714, 715, Ann.Cas.1917A, 1160; Lawler v. Solus, 101 Cal.App.2d 816, 226 P.2d 348; Hennen v. Streeter, 55 Nev. 285, 31 P.2d 160; Mahoney v. Citizens' Nat. Bank, 47 Idaho 24, 271 P. 935; National Bank of Gallatin Valley v. Ingle, 53 Mont. 414, 164 P. 535; Simmons v. Shaft, 91 Kan. 553, 138 P. 614; Robinson v. Haas, 40 Cal. 474, 2 Am.Jur., Animals, § 17. By the terms of the agreement the title to the original herd remained in the bailor, and the parties became tenants in common of the increase, share and share alike. Mahoney v. Citizens' Nat. Bank, supra.
After December 24, 1950, when the contract and previous extensions had expired, the parties were negotiating a new lease. Defendants refused to sign the kind of a lease demanded by plaintiff but retained possession of the cattle. The plaintiff refused to extend the old lease but permitted the cattle to remain in the possession of defendants until the commencement of these proceedings on April 18, 1951. The circuit court was justified under the facts in deciding that the lease was not terminated *550 on December 24, 1950, by mutual consent of the parties as claimed by plaintiff. Since defendants owned an undivided half interest in the calves born after December 24, 1950, they were entitled to a decree awarding them half of those calves, or the equivalent in money. It was so decreed by the circuit court.
Judgment affirmed.
All the Judges concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3034120/ | FILED
NOT FOR PUBLICATION FEB 26 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
REYNALDO PRECILLA CARADANG, No. 07-72910
Petitioner, Agency No. A044-946-932
v.
MEMORANDUM *
ERIC H. HOLDER Jr., Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted February 16, 2010 **
Before: FERNANDEZ, GOULD, and M. SMITH, Circuit Judges.
Reynaldo Precilla Caradang, a native and citizen of the Philippines, petitions
for review the Board of Immigration Appeals’ (“BIA”) order denying his appeal
from an immigration judge’s (“IJ”) removal order and denying his motion to
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
JT/Research
remand alleging ineffective assistance of counsel. Our jurisdiction is governed by
8 U.S.C. § 1252. We review for abuse of discretion the denial of a motion to
remand and de novo questions of law. Lin v. Ashcroft, 377 F.3d 1014, 1023-24
(9th Cir. 2004). We deny in part and dismiss in part the petition for review.
The IJ properly determined that Caradang was removable pursuant to
8 U.S.C. § 1227(a)(1)(A), as an inadmissible alien based on willful
misrepresentation of a material fact pursuant to 8 U.S.C. § 1182(a)(6)(C)(i).
The BIA did not abuse its discretion in denying the motion to remand
because Caradang presented insufficient evidence to establish prejudice. See
Rojas-Garcia v. Ashcroft, 339 F.3d 814, 826 (9th Cir. 2003) (to prevail on an
ineffective assistance of counsel claim a petitioner must demonstrate prejudice);
see also Forbes v. INS, 48 F.39 439, 442 (9th Cir. 1995) (knowledge of the falsity
of information is sufficient to establish willful misrepresentation of material fact).
We lack jurisdiction to consider the IJ’s discretionary denial of Caradang’s
application for a waiver under 8 U.S.C. § 1227(a)(1)(H). See San Pedro v.
Ashcroft, 395 F.3d 1156, 1157-58 (9th Cir.2005).
PETITION FOR REVIEW DENIED in part; DISMISSED in part.
JT/Research 2 07-72910 | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/3033617/ | FILED
NOT FOR PUBLICATION FEB 23 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
VERONICA NATALI VALENCIA- No. 08-71775
VASQUEZ,
Agency No. A098-936-543
Petitioner,
v. MEMORANDUM *
ERIC H. HOLDER Jr., Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted February 16, 2010 **
Before: FERNANDEZ, GOULD, and M. SMITH, Circuit Judges.
Veronica Natali Valencia-Vasquez, a native and citizen of El Salvador,
petitions for review of the Board of Immigration Appeals’ (“BIA”) order
dismissing her appeal from an immigration judge’s decision denying her
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
DL/Research
application for asylum, withholding of removal, and relief under the Convention
Against Torture (“CAT”). We have jurisdiction under 8 U.S.C. § 1252. We
review de novo questions of law, Cerezo v. Mukasey, 512 F.3d 1163, 1166 (9th
Cir. 2008), except to the extent that deference is owed to the BIA’s determination
of the governing statutes and regulations, Simeonov v. Ashcroft, 371 F.3d 532, 535
(9th Cir. 2004). We review factual findings for substantial evidence. Zehatye v.
Gonzales, 453 F.3d 1182, 1184-85 (9th Cir. 2006). We deny the petition for
review.
We reject Valencia-Vasquez’s claim that she is eligible for asylum and
withholding of removal based upon an anti-gang political opinion or based upon
her membership in a particular social group. See Barrios v. Holder, 581 F.3d 849,
854-56 (9th Cir. 2009); Santos-Lemus v. Mukasey, 542 F.3d 738, 745-46 (9th Cir.
2008). Accordingly, because Valencia-Vasquez failed to demonstrate that she was
persecuted or fears future persecution on account of a protected ground, we deny
the petition as to her asylum and withholding of removal claims. See Barrios, 581
F.3d at 856.
Substantial evidence supports the agency’s denial of CAT relief because
Valencia-Vasquez failed to establish it was more likely than not that she would be
DL/Research 2 08-71775
tortured by or at the instigation of or with the consent or acquiescence of a public
official. See Santos-Lemus, 542 F.3d at 747-48.
Valencia-Vasquez’s due process claim fails because, contrary to her
contention, the BIA issued a reasoned decision and not a streamlined order
pursuant to 8 C.F.R. § 1003.1(e)(4).
PETITION FOR REVIEW DENIED.
DL/Research 3 08-71775 | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1580775/ | 337 Mich. 20 (1953)
59 N.W.2d 65
BACKING
v.
ESTATE OF BACKING.
Calendar No. 45,297.
Supreme Court of Michigan.
Decided June 8, 1953.
Eugene Christman, for plaintiff.
Campbell & Campbell, for defendant estate.
SHARPE, J.
Louis Henry Backing died November 12, 1942. His widow, Carolina Backing, filed a petition in the probate court of Manistee county, Michigan, to have his estate administered according to law. The petition recited that Louis Henry Backing, at the time of his death, was a resident of the city of Manistee in said county and that the estate consisted of real estate, $15,000, and personal estate, $5,000, in Manistee county.
*22 On September 13, 1944, an order was entered appointing Carolina Backing administratrix of said estate. On November 20, 1944. an order was entered allowing claims and for payment of debts. On June 23, 1947, an account of Carolina Backing, as administratrix, was filed showing receipts and disbursements and on March 23, 1950, a final account was filed; however, on February 21, 1950, an order was entered removing Carolina Backing as administratrix of the estate and Leonard Hanson was appointed administrator of said estate. On April 21, 1950, Fred Backing, a son of Louis Henry Backing, filed a notice of appeal to the circuit court of Manistee county from the order of the probate court allowing the final account. The reasons stated in the appeal are as follows:
"This court is without jurisdiction to administer the estate of the above-named decedent and consequently to enter an order allowing the account of the administrator for the reason that the decedent was neither an inhabitant nor a resident of the county of Manistee at the time of his death, and the court has acquired no jurisdiction of his estate. * * *
"That the allowance is contrary to the best interest of said estate for the reason that it did not contain nor make allowance for certain items of income totalling the sum of $4,228.09, which said items were either collected by the administrator or his predecessor.
"That said account ought to be disallowed because it does not include various items of income belonging to said estate, in the hands of parties known to the administrator.
"The final account in said estate is premature for the reasons that there are outstanding certain items of indebtedness, which the administrator, by the exercise of ordinary care, should be able to collect."
On June 29, 1950, a motion to dismiss the appeal was filed by the administratrix of the estate. The *23 reasons stated for dismissal of the appeal are as follows:
"That no notice of said appeal was served upon the appellee, Carolina Backing, administratrix of said estate or her attorneys, as provided in the order of the probate court dated April 25th, 1950. * * *
"That said appellant has not filed with said circuit court, a record consisting of the certified copies of the probate court record appealed from as required by statute and as shown by the certificate of the county clerk now on file in this cause and on file with the probate court for the county of Manistee.
"That more than 60 days have elapsed since the entry of the order attempted to be appealed from and said probate court has no jurisdiction to extend the time for taking of such appeal.
"That more than 10 days have elapsed since the beginning of the first term of court following the claim of such appeal, and no motion or order has been made or entered therein reinstating said appeal.
"That the circuit court by reason of such failure to take and perfect said appeal does not have jurisdiction of the person nor subject matter thereof."
On November 24, 1950, an order was entered granting the motion to dismiss the appeal. On December 15, 1950, Fred Backing filed a petition in the circuit court for a delayed appeal in which he alleges:
"That heretofore to wit on or about the 23d day of April, A.D. 1950 a claim of appeal from an order entered by the probate court, dated April 10, 1950, allowing the final account of the administratrix of said estate, was duly filed by this petitioner in said probate court, that thereafter on April 25, 1950 a properly executed bond on appeal was filed therein, which said bond was duly approved by said probate court; that on said April 25, 1950 said appellant, through his attorney, Eugene Christman, by a request in writing made to the Honorable Max C. Hamlin, judge of probate, ordered a certified copy of the *24 order providing for service of the notice of appeal and presented to said court an unexecuted copy thereof for such purpose; that said attorney did make, on said day, in writing, a request for certified copies of the entire proceedings to be used in connection with said appeal, to wit:
"1. Order appointing Mrs. Backing administratrix, together with proof of publication or waiver of Fred Backing, if the same appears of record.
"2. The inventory and appraisal or any amendments thereto.
"3. The order allowing claims, if such has been entered.
"4. The account of June 17, 1947.
"5. The account of March 16, 1950 and the order allowing.
"6. The order removing the administrator and appointing a substitute.
"Further that the fees provided by law for the preparation of said certification were duly tendered to said court at the time of said request.
"That the record of proceedings so requested was not furnished said attorney until Friday, June 30, 1950 and after filing of a motion to dismiss said appeal hereafter argued in this court and dismissed by virtue of the order entered November 29, 1950.
"That if failure of said attorney to properly perfect said appeal within the statutory period was negligence on the part of said attorney, it does not constitute culpable negligence on the part of this appellant, since appellant relied upon his said attorney to take the necessary steps in perfecting said appeal.
"Petitioner further alleges that said attorney was diligent in every way in obtaining a certified copy of the order providing for service on appeal but that it was impossible because of the work of the probate office for the probate office to get the record out on time.
*25 "Petitioner further alleges that he has a meritorious basis for his appeal by reason of the following facts:
"(a) The probate court is without jurisdiction to administer the estate of the above-named decedent for the reason that decedent was neither an inhabitant nor a resident of the county of Manistee at the time of his death.
"(b) The allowance of said account was contrary to law, the court having no jurisdiction to enter the same.
"(c) The allowance of the account was contrary to the best interest of said estate in that it did not contain items of income received by the administratrix or her predecessor, totalling the sum of approximately $4,228.09.
"(d) Said account ought to be disallowed because it did not include various items of income belonging to said estate but permitted by the administratrix to remain in the hands of certain of the heirs of said estate.
"(e) Said account ought not to be allowed because the administratrix was negligent in collecting certain items of indebtedness owing to said estate which the administratrix should have collected by the exercise of ordinary care."
On May 24, 1951, an order was entered denying petitioner's petition for a delayed appeal. In an opinion filed, the trial court found as a fact that the failure to timely perfect the appeal was not due to the fault or neglect of petitioner. The court also held that justice did not require a revision of the case. Upon leave being granted, petitioner appeals and urges that justice requires a revision of the order of the probate court entered April 14, 1950, allowing the final account of the administratrix of the estate. It is agreed that the sole issue is whether the trial court abused its discretion in denying petitioner a delayed appeal.
*26 CL 1948, § 701.43 [Stat Ann 1943 Rev § 27.3178 (43)] provides:
"If any person aggrieved by any act of the judge of probate shall from any cause, without default on his part, have omitted to claim or prosecute his appeal according to law, the circuit court, if it shall appear that justice requires a revision of the case, may, on the petition of the party aggrieved, and upon such terms as it shall deem reasonable, allow an appeal to be taken and prosecuted with the same effect as if it had been done seasonably."
The allowance of delayed appeal is discretionary with the trial court and the burden of showing reasons for a delayed appeal is upon the party seeking it. We do not reverse the determination of the circuit judge unless it appears that there has been a clear abuse of discretion. See Clark v. Berrien Circuit Judge, 194 Mich. 180. In Taylor v. Bay Circuit Judge, 234 Mich. 363, 366, we said:
"The statute leaves the question to the discretion of the circuit judge, and unless there is a clear abuse of that discretion this Court will not disturb his finding. There is no abuse of discretion if the facts presented are fairly passed on by the circuit judge. His judgment may be erroneous. It may not be such a judgment as we would have rendered in determining the facts, but, unless it is clearly against reason and the evidence, or shows that he acted arbitrarily and unreasonably, it cannot be said that it was an abuse of discretion."
Petitioner's request for a delayed appeal was based upon 5 reasons, the first of which, is that the probate court was without jurisdiction to administer the estate of Louis Henry Backing in that decedent, at the time of his death, was not a resident of Manistee county. The record shows that on February 10, 1943, Carolina Backing, widow of deceased, *27 filed a petition in the probate court of Manistee county to have the estate of Louis Henry Backing administered. The petition recited: "Said deceased was, at the time of his death, an inhabitant of the city of Manistee in said county." On September 13, 1944, the probate court entered an order in part as follows:
"On reading * * * petition of Carolina Backing, widow * * * praying * * * administration of said estate be granted to Carolina Backing * * * and waivers notice of the hearing on said petition having been filed * * * and no one appearing in opposition thereto;
"It appearing to the Court; * * * that he was at the time of his death, an inhabitant of the city of Manistee."
Approximately 6 years later petitioner invoked the power of the probate court by filing a petition in said court "asking for removal of the administratrix, Carolina Backing, and for a full and complete accounting from her as such administratrix." Moreover, petitioner did not raise this issue until he filed his first petition and notice to appeal on April 21, 1950. The trial court in discussing this issue said:
"Reason (1) is predicated upon the ground that the deceased at the time of his death was not a resident or inhabitant of Manistee county, whereby the probate court acquired no jurisdiction to administer his estate. It appears from the probate record that the petition for the administration of the deceased's estate was presented by his widow, Carolina Backing, and verified on February 10, 1943. It contains a recital that deceased died November 12, 1942, an inhabitant of the city and county of Manistee and left estate therein, as well as in Mason and Houghton counties. It names the widow, the petitioner, as a resident of Manistee. It names the appellant, Fred A. Backing, as a son and heir of deceased, of Free-soil, *28 in Mason county. The petition, on its face, conferred jurisdiction upon the probate court to administer the estate.
"In this connection it may also be noted that the court in appointing Mrs. Backing administratrix of the estate, in legal effect, determined that the deceased was a resident or inhabitant of Manistee county at the time of his death and was possessed of estate therein, as alleged in her petition. Otherwise, it may be presumed, that the court would not have proceeded with the administration of the estate. This finding was not appealed from or questioned by appellant until he filed his reason for the appeal in April, 1950."
In our opinion the petition for the appointment of an administratrix was regular in form showing that deceased died in Manistee county leaving an estate to be probated. Under such circumstances the probate court acquired jurisdiction of the cause. We are also of the opinion that petitioner having signed a waiver of notice on the petition for appointment of an administratrix on February 10, 1943, and having invoked the aid of the court to have the administratrix discharged, is now estopped to challenge the jurisdiction of that court. The other reasons given by petitioner are in substance as follows:
"That the allowance of the account was contrary to law; that the account failed to make allowance for certain items of income, totaling $4,228.09; that it did not include various items of income belonging to the estate, in the hands of parties known to the administratrix, and that there were certain items of indebtedness outstanding which should have been collected in the exercise of due care."
The trial court in considering the other reasons advanced by petitioner stated:
"Does the showing in appellant's sworn answer and in his petition for the delayed appeal, conform to *29 these rules? I am of the opinion that they do not. The showing is not sufficient to permit the court to make a finding that justice requires a revision of the case.
"First, considering briefly reasons (2)-(5) inclusive. They fail to present any evidential facts upon which the court may exercise its discretion.
"Reason (2) is merely the conclusion of the pleader. The nature of items (3), (4) and (5) are merely described in general terms. It does not appear from what source they arise, or the nature of the assets or transactions from which they are claimed to be derived or in what manner the estate may be charged with an interest therein or with the duty to enforce either the collections or payments of the alleged claims.
"The names and residence of the debtors are not given or even the approximate date of the items mentioned. It does not affirmatively appear that the items, if valid claims were within the authority and jurisdiction of the court to collect, or that the debtors themselves were within reach of its process."
The burden of proof is upon petitioner to satisfy the court that justice requires a revision of the case. In doing so, petitioner must submit sufficient facts in order that the court may exercise its discretion. The facts shown must be sufficient to make out a prima facie case. See McKay v. Macomb Circuit Judge, 222 Mich. 244, and Hamler v. Shiawassee Circuit Judge, 227 Mich. 235.
We are in accord with the reasoning of the trial court in denying the belated appeal. Justice does not require a revision of the case. The order of the circuit court denying petitioner's belated appeal is affirmed, with costs to the estate.
DETHMERS, C.J., and ADAMS, BUTZEL, CARR, BUSHNELL, BOYLES, and REID, JJ., concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580788/ | 12 So. 3d 314 (2009)
Valerie K. AUSTIN, Appellant/Cross-Appellee,
v.
Andrew L. AUSTIN, Appellee/Cross-Appellant.
No. 2D07-3104.
District Court of Appeal of Florida, Second District.
June 26, 2009.
*315 Charles A. Murray of Law Office of Charles A. Murray, P.A., Bonita Springs, *316 and Allison M. Perry of Law Office of Allison M. Perry, Tampa, for Appellant/Cross-Appellee.
Cynthia B. Hall of Silverio & Hall, P.A., Naples, for Appellee/Cross-Appellant.
SILBERMAN, Judge.
Valerie K. Austin (the Wife) appeals a final judgment of dissolution of marriage and challenges provisions regarding equitable distribution, alimony, and attorney's fees. Andrew L. Austin (the Husband) cross-appeals and also challenges the equitable distribution scheme and alimony award. We affirm the dissolution of the parties' marriage but reverse and remand for a new trial on the issues of equitable distribution, alimony, and attorney's fees.
The parties had a long-term marriage of thirty-eight years when the Wife filed the petition for dissolution on April 19, 2005. The parties were retired when the Husband moved out of the marital home. The Husband retired on full disability in 1992, and the Wife retired from substitute teaching in 1998. The monthly marital income was approximately $5300. After leaving the marital home, the Husband rerouted all the parties' monthly income to an individual bank account in Maryland, except for $800 in trust income that was solely in the Wife's name. He also withdrew $8600 from the parties' joint checking account, leaving a balance of $700. The Wife was left with marital monthly bills totaling $5300. The Wife obtained employment as a teacher after the Husband left. At the time of trial in 2007, the Husband was sixty-two years old and the Wife was sixty-three years old.
With respect to equitable distribution, the trial court is required to identify and value the significant marital assets and designate which spouse is entitled to each asset; similarly, the trial court is required to identify the marital liabilities and designate which spouse is responsible for each liability. § 61.075(3), Fla. Stat. (2004). Here, the trial court failed to make specific written findings identifying the marital liabilities. Rather, the court ordered that all marital liabilities, including a deficiency judgment, "shall be distributed equally unless otherwise stated." This court has recognized that "[i]t is reversible error for a trial court to simply indicate that marital liabilities are to be equally divided without identifying each specific liability and without identifying which spouse is responsible for each." Italiano v. Italiano, 873 So. 2d 558, 561 (Fla. 2d DCA 2004).
With respect to marital assets, the Husband challenges the valuation of his IRA, the parties' largest asset. The Husband correctly contends that the trial court erred in failing to consider the tax consequences when he presented testimony by a CPA of the IRA's value and the amount of taxes the Husband would have to pay on his IRA. See Kadanec v. Kadanec, 765 So. 2d 884, 886 (Fla. 2d DCA 2000); Werner v. Werner, 587 So. 2d 473, 474 (Fla. 3d DCA 1991). In addition, in valuing other assets, such as the parties' RV lot and jewelry, the trial court stated that the evidence was conflicting and found values for those assets without explaining how it reached those values. The record does not fully clarify the basis for the trial court's findings, and without findings to explain how the trial court reached a particular value in the face of conflicting evidence, appellate review is hampered.
We also note the Wife's contention that the trial court erred in awarding assets to her that had been depleted during the dissolution proceedings. When a spouse depletes marital assets during the pendency of dissolution proceedings to pay for support, living expenses and litigation *317 expenses, it is error to include the assets in the equitable distribution scheme in the absence of misconduct. See Plichta v. Plichta, 899 So. 2d 1283, 1286 (Fla. 2d DCA 2005). The trial court specifically found that the Wife depleted her IRA for support and marital expenses. The Wife also contends that she depleted her trust account and Citibank account to pay the parties' creditors during the separation. The trial court found "that there was no misconduct on the part of either party, although both parties have acted inappropriately." On remand, in fashioning the equitable distribution, the trial court cannot award assets that were depleted during the dissolution proceedings that were expended for support and marital expenses if the parties engaged in no misconduct.
The parties also agree that the trial court erred in its calculation of the equalization payment. The value of assets the court awarded to the Wife was $16,799 more than the value of assets awarded to the Husband. Rather than award half of that difference to the Husband, the court awarded the full $16,799 to the Husband as an equalization payment, using it to reduce the amount of past alimony due from the Husband. Because we are reversing the equitable distribution scheme, the court will have to recalculate any equalization payment that may be necessary on remand.
With respect to alimony, the Wife sought $1200 per month in permanent, periodic alimony to supplement her earnings as a teacher. The trial court awarded to the Wife permanent, periodic alimony of $800 per month until retirement and $1000 per month after retirement. The trial court also awarded $800 per month of "back alimony" for the twenty-five months prior to the final hearing. Although the parties disagree on whether the trial court should have awarded alimony, they agree that the trial court failed to make the necessary factual findings to support the award it made. In his motion for rehearing, which the trial court denied, the Husband brought the lack of factual findings to the trial court's attention.
In this long-term marriage of thirty-eight years, there is an initial presumption in favor of an award of permanent alimony. See Schlagel v. Schlagel, 973 So. 2d 672, 676 (Fla. 2d DCA 2008) (marriage of over twenty-one years); Schomburg v. Schomburg, 845 So. 2d 257, 258 (Fla. 2d DCA 2003) (marriage of twenty-four years). To support its alimony determination, the trial court must include specific findings of fact in the final judgment. § 61.08(1), Fla. Stat. (2004); Williams v. Williams, 923 So. 2d 606, 607 (Fla. 2d DCA 2006); Schomburg, 845 So.2d at 258. Although the final judgment contains some findings concerning the factors listed in section 61.08(2)(a)-(g), the trial court failed to make specific findings concerning the financial resources and income available to each party. See § 61.08(2)(d), (g). The financial needs of one spouse and the ability of the other spouse to pay are the primary factors for the trial court to consider in determining whether to award permanent alimony. Schlagel, 973 So.2d at 676; Italiano, 873 So.2d at 560.
The trial court made a general finding that "the Husband receives more income, as indicated on Financial Affidavits, than the Wife who has recently worked as a school teacher since separation." The trial court made no specific findings regarding either party's income or expenses.[1] Moreover, the trial court made *318 no findings of how it reached the figure of $1000 per month as the monthly award after the Wife's retirement. We note that the Wife testified at the final hearing that her teaching contract had not been renewed and that she was looking for new employment. However, "[t]he determination of whether there is need and ability to pay is made at the time of the final hearing, and the trial court may not speculate on what might happen in the future." Italiano, 873 So.2d at 560. Although the trial court sought to account for the Wife's anticipated loss of earnings, it is unclear how the trial court arrived at the $1000 figure. The parties also dispute the Husband's monthly net income, particularly the income the Husband receives from his IRA. Also, the Husband testified regarding an anticipated future decrease in income based on disability insurance payments ceasing at age sixty-five. In this case, the lack of adequate findings hampers meaningful appellate review. See Williams, 923 So.2d at 608; Obrenski v. Obrenski, 817 So. 2d 877, 878 (Fla. 2d DCA 2002); Farley v. Farley, 800 So. 2d 710, 711-12 (Fla. 2d DCA 2001); Milo v. Milo, 718 So. 2d 343, 344-45 (Fla. 2d DCA 1998).
With respect to attorney's fees, our reversal of the equitable distribution scheme and alimony award will require that the trial court reconsider attorney's fees on remand.
We are reluctant to order a new trial but determine, under the circumstances, that it is necessary. Both parties presented some testimony as to anticipated occurrences which may or may not have developed. Due to the number of errors, the passage of time, the retirement of the trial judge, and other circumstances, including bankruptcy proceedings, we reverse for a new trial on the equitable distribution, alimony, and attorney's fees.[2]See Parker v. Parker, 976 So. 2d 104, 105-06 (Fla. 2d DCA 2008); McGoldrick v. McGoldrick, 940 So. 2d 1275, 1277 (Fla. 2d DCA 2006); Prest v. Tracy, 749 So. 2d 538, 539-40 (Fla. 2d DCA 2000). Thus, we affirm the dissolution of the marriage but otherwise reverse the final judgment and remand for a new trial.
Affirmed in part, reversed in part, and remanded.
CASANUEVA and LaROSE, JJ., concur.
NOTES
[1] Although the judgment references the financial affidavits, we note that the Wife filed her financial affidavit and amended financial affidavit with the clerk but did not introduce them into evidence or submit them as exhibits at trial. The Wife testified that the monthly expenses of $5000 did not change after the Husband left except for food. The Husband also testified that the monthly marital income was $5325 and that there was no money left over at the end of the month.
[2] Of course, if the parties are able to stipulate to certain issues, such as the values of assets and liabilities and the parties' incomes and expenses, they may be able to avoid at least some of the litigation costs that will be involved in a new trial. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580743/ | 59 N.W.2d 849 (1953)
FERCH
v.
HOUSING AUTHORITY OF CASS COUNTY et al.
No. 7357.
Supreme Court of North Dakota.
July 22, 1953.
*850 *851 *852 *853 *854 *855 Leonell W. Fraase, Fargo, for plaintiff and appellant.
Ohnstad & McCauley, West Fargo, for defendants and respondents.
Dean Winkjer, Williston, as Amicus Curiae.
GRIMSON, Judge.
The plaintiff, on behalf of himself and other taxpayers similarly situated, sought an injunction in district court to have the defendants restrained from completing arrangements with the Public Housing Administration, a federally owned corporation, for the purpose of effecting a slum clearance and low rent housing program in the City of Southwest Fargo. The district court found in favor of the defendants and plaintiff appeals.
The following facts are admitted: The plaintiff is a citizen, resident, taxpayer and owner of real estate in the City of Southwest Fargo, a municipal corporation. The defendant, the Housing Authority of Cass County, hereinafter referred to as the Authority, was organized in accordance with the provisions of Chapter 23-11 NDRC 1943 and 1949 Supplement, the North Dakota Housing Authorities Law, by a resolution of the Board of Commissioners of Cass County on April 5, 1951, and claims all the powers, duties, rights and privileges provided therein. The defendant City of Southwest Fargo is a duly incorporated city under the laws of North Dakota. The Public Housing Administration is a federal corporation organized under the U. S. Housing Act of 1937, 42 U.S.C.A. §§ 1401-1430, as amended, for the purpose of aiding local public housing agencies in the development and operation of slum clearance and low rent housing projects. On April 10, 1951, the Housing Authority of Cass County and the City of Southwest Fargo entered into a "cooperation agreement" as required by the Federal Housing Administration providing for the cooperation of the two bodies in slum clearance and in the development of a low rent housing project. On the 16th day of May, 1951, the Housing Authority of Cass County applied to the Public Housing Administration for a program reservation for 36 dwelling units of a proposed low rent and slum clearance housing project in the City of Southwest Fargo and for a loan of $7200 for the purpose of preliminary surveys and planning. On July 6, 1951, the Public Housing Administration approved such program for 24 dwelling units. The Housing Authority of Cass County has applied for a preliminary loan of $4800 of which $960 has been received. The Housing Authority of Cass County now intends to enter into a further contract with the Public Housing Administration for a loan of $200,000, being 90 per cent of the cost of the proposed project, and plans to go on with the project under the federal and state housing laws.
The plaintiff claims that the defendants should be enjoined from proceeding further along this line on the grounds that the State Act, Chap. 23-11 NDRC 1943 and 1949 Supplement, under which they are acting, is unconstitutional and that the cooperation agreement is ultra vires and void.
*856 It is a well established rule in this jurisdiction that a statute enacted by the legislature is presumed to be constitutional. This presumption is conclusive unless it is clearly shown that the enactment is prohibited by the constitution of the state or of the United States. The burden of showing unconstitutionality is upon him who alleges that some particular provision of the state or federal constitution has been violated. Stark v. City of Jamestown, 76 N.D. 422, 37 N.W.2d 516; State ex rel. Sathre v. Board of University & School Lands, 65 N.D. 687, 262 N.W. 60; State ex rel. Linde v. Taylor, 33 N.D. 76, 85, 86, 156 N.W. 561, L.R.A.1918B 156, Ann.Cas.1918A, 583.
"All statutes must be construed, if possible, so as to give them validity, force, and effect, and carry out the will of the legislator. In doing this, respect must always be had to the language of the statute, the plain and obvious meaning of the words used, and * * * their objects and purposes". People v. Sweetser, 1 Dakota 308 (Reprint page 295), 46 N.W. 452, 453.
"The courts invariably give the most careful consideration to questions involving the interpretation and application of the Constitution and approach constitutional questions with great deliberation, exercising their power in this respect with the greatest possible caution and even reluctance; and they should never declare a statute void, unless its invalidity is, in their judgment, beyond reasonable doubt." 11 Am.Jur., Constitutional Law, § 91, p. 718.
The first contention of the plaintiff is that "The State Act is unconstitutional and void in that the purposes authorized are not public or governmental purposes within the meaning of Article I, Section 14 of the state constitution and thus the power of eminent domain cannot be exercised."
The purpose of the State Act must be determined in view of the situation that now exists. The changes in North Dakota since the constitution was enacted must be taken into consideration. The constitution is unchanged but the needs over which it may control have changed.
"Views as to what constitutes a public use necessarily vary with changing conceptions of the scope and functions of government, * * *. As governmental activities increase with the growing complexity and integration of society, the concept of `public use' naturally expands in proportion." Dornan v. Philadelphia Housing Authority, 331 Pa. 209, 200 A. 834, 840. See also Borgnis v. Falk Co., 147 Wis. 327, 133 N.W. 209, 215, 216, 37 L.R.A.,N.S., 489.
During the last twenty years much attention has been given to the evils caused by the lack of adequate housing for people of low incomes and their congregation into slum areas. The housing division of the Public Works Administration undertook the clearance of slum areas and the construction of low rent housing projects. Then two world wars have created the problem of aiding needy veterans in obtaining housing. Favorable loans to veterans for that purpose were provided. These activities have been continued by the Federal Government in various forms and are now authorized by the 1937 Federal Housing Act, 42 U.S.C.A. §§ 1401-1430, as amended, hereinafter referred to as the Federal Act. The avowed purpose of that Act is to lend financial assistance to cities seeking to remove slum areas and to substitute therefor low cost housing for persons of low income, preference being given to veterans. This act has been held to be for the promotion of general welfare and therefore constitutional. See City of Cleveland v. United States, 323 U.S. 329, 65 S. Ct. 280, 89 L. Ed. 274; United States v. Boyle, D.C.N.D.Ohio, 52 F. Supp. 906; Oklahoma City v. Sanders, 10 Cir., 94 F.2d 323, 115 A.L.R. 363.
The first attempt in North Dakota along that line was the enactment in 1919 of the law providing for the Home Building Association of North Dakota, to encourage home building and home ownership in this state. The Act authorized the State, as the Home Building Association, to build homes for individuals on certain conditions. That Act was, in Green v. Frazier, 44 N.D. 395, 176 N.W. 11, affirmed *857 253 U.S. 233, 40 S. Ct. 499, 64 L. Ed. 878, declared to be for a public purpose and constitutional. That, however, proved an unsuccessful business undertaking and was abandoned. There was no great need for new housing then. Now it is a matter of common knowledge that housing is scarce, that slum conditions have appeared in our larger cities and that there is need for "housing for people of low income at rentals they can afford to pay.
The North Dakota Housing Authorities Act, hereinafter called the State Act, Chapter 23-11 NDRC 1943, as amended in the 1949 Supplement, was first passed in 1937 to enable municipalities to take advantage of the Federal Act. It creates in each city of more than 5000 population and in each county of the state "a public body corporate and politic to be known as the `housing authority' of the city or county, as the case may be." NDRC 1943, 23-1102. Such housing authority comes into existence when the governing body of the city or county by a proper resolution declares the need for a housing authority. As a basis for such declaration the governing body must find "1. That insanitary or unsafe inhabited dwelling accommodations exist in the city or county; or 2. That there is a shortage of safe or sanitary dwelling accommodations in such city or county available to persons of low income at rentals they can afford to pay." Section 23-1103 NDRC 1943. That section further provides that in making such resolution the governing body may take into consideration "the degree of overcrowding, the percentage of land coverage, the light, air, space, and access available to the inhabitants of such dwelling accommodations, the size and arrangement of the rooms, the sanitary facilities, and the extent to which conditions which endanger life or property by fire or other causes exist in such buildings." A favorable action by the local authorities is to be taken only if it is found that such conditions exist.
The primary object of all government is to provide for the welfare of its citizens. For that purpose laws are enacted to foster the health, morals and safety of the people. To carry that out taxes are levied. One of the fields in which there is need for the enactment of a law for that purpose is in the ever growing slum districts in our cities. It is generally recognized that in such districts the living quarters of the unfortunate, who have not the means of living in better quarters, are congested. Heating, ventilation, sunlight and sanitary conditions are meager. Such places become breeding places of disease, immorality and crime. The character of the houses in such districts makes them a fire hazard. The government is often put to great expense in combating disease, crime and conflagration originating in such quarters. They menace not only the health, safety and morals of those living there, but since disease, crime, immorality and fire can, with difficulty, be confined to points of origin, these districts become a menace to the whole community and to the state. In section 2, Chapter 102, S.L.1937, the legislature has declared that these conditions exist in this state.
Under the State Act it is proposed that the housing authorities cooperate with the municipal authorities in slum clearance, and with the aid afforded by the Federal Act build sanitary low rent dwellings. The legislature has declared that this is for "public uses and purposes for which public money may be spent and private property acquired * * *." Section 2, Chap. 102, S.L.1937.
The declaration of our legislature that such projects are devoted to the public use, while not necessarily binding or conclusive upon the courts, is entitled to great weight. This declaration also has the support and the concurrence of the Congress of the United States and of the legislatures of at least 32 states which have enacted similar legislation. It is not the duty of the courts to interfere with such legislative finding unless it clearly appears to be erroneous and without reasonable foundation. In Rutherford v. City of Great Falls, 107 Mont. 512, 86 P.2d 656, 658, it is well said:
"The public nature of slum clearance projects having been recognized and passed upon by the legislature, as was their right, it is not now our duty *858 or prerogative to interfere with that legislative finding in the absence of a clear showing that the determination of that body was wrong. Their findings, while not conclusive, are entitled to much weight."
In all of the states which have enacted similar legislation for the purpose of cooperating with the Federal Act, where its constitutionality has been challenged, the courts have found the legislation to be for a public purpose and in furtherance of a proper governmental function.
In Housing Authority of Los Angeles County v. Dockweiler, 14 Cal. 2d 437, 94 P.2d 794, 801, the court said:
"However, aside from the respect to be accorded the legislative declaration of the public purpose underlying the statutes here challenged, it is our view, and we are satisfied that both reason and authority support us that the proposed elimination of slums and the erection of safe and sanitary low-rent dwelling units for persons of the prescribed restricted income will do much to advance the public welfare and to protect the public safety and morals and are in fact and law public purposes."
In Allydonn Realty Corp. v. Holyoke Housing Authority, 304 Mass. 288, 23 N.E.2d 665, 668, the court said:
"The elimination of slums can be found to be a direct benefit and advantage to all of the people, to be a matter not readily approached through private initiative but demanding coordinated effort by a single authority, to be in line with the purposes of promoting the public safety, health and welfare for which the government of the Commonwealth was established, and to require for its successful accomplishment the exercise of the power of eminent domain. It may well be deemed to rise to the dignity of a public service."
In Chapman v. Huntington Housing Authority, 121 W.Va. 319, 3 S.E.2d 502, 508, the court says:
"In these modern times, it can scarcely be gainsaid that slums are areas having insanitary and substandard housing, and are a menace to the health, welfare and morals of any community in which they exist. Slum areas, because of the congestion, filth and insanitary conditions which are their ever-existing qualities, are the breeding places of crime, immorality and disease. These evils necessarily and inevitably strike at the heart of the happiness and well being of all the people of the community. They cannot run rampant in any part of a community without stretching their tentacles menacingly throughout its entire length and breadth. Thus the eradication of slum areas would seem to rest upon the firm foundation of the police power which inherently resides in the legislative branch of every state government. Any purpose leading toward that end is a public purpose." (Cases cited.)
In McNulty v. Owens, 188 S.C. 377, 199 S.E. 425, 429, the court says:
"* * * An examination of the juvenile delinquency in Columbia during the year 1937 shows that practically all of these cases come from bad housing areas. A similar check indicates that bad housing is a very material factor in our high infant mortality rate.
"Experience in other parts of the country and in England indicate a very substantial improvement in health and in morals where sanitary housing has been provided for persons of low income. * * *
"Considering all of these matters, including the obvious need for low-cost housing, the apparent inability of private capital to supply such housing, and the satisfactory solution of the problem afforded by similar governmental programs of slum clearance and low-cost housing here and elsewhere, we conclude that the slum clearance and low-cost housing project planned *859 by the Columbia Housing Authority is an exercise of a proper governmental function for a valid public purpose."
In our Housing Authorities Law, as in the laws of other states, special provisions are made for veterans, section 23-1131, 1949 Supplement, but that also is for a public purpose.
In the Opinion of the Justices, 320 Mass. 773, 67 N.E.2d 588, 593, 165 A.L.R. 807, it is stated:
"That the expenditure of public money in recognition of military services, even long after such services have been rendered, though such expenditure of money is directly for the private benefit of the persons rendering such services, is a public purpose has been held or stated in decisions of this court or in opinions of its Justices. (Citing cases.) The constitutionality of statutes providing for preferences to veterans in the classified civil service has been sustained upon somewhat analogous principles. (Citing authority.) * * * In the decisions and opinions treating expenditures of money in recognition of military services as expenditures for a public purpose, the form of the expenditures considered was different from the form of the expenditure authorized by the pending bill. We perceive no difference, however, with respect to the nature of the purpose as a public purpose between the expenditures there considered and expenditure in the form authorized by the pending bill to provide housing for the benefit of service men, veterans and their families in the existing condition of an acute shortage of housing. It is not for us to express any opinion upon the expediency of expenditure of public money in the form authorized by the pending bill. Clearly, it is not so unreasonable as to preclude that purpose being a public purpose."
Plaintiff cites Minnesota Canal & Power Co. v. Koochiching Co., 97 Minn. 429, 107 N.W. 405, 5 L.R.A.,N.S., 638, 7 Ann.Cas. 1182, as holding that the public benefit of a project is not sufficient to constitute a public use. That case, however, is distinguished in the later case of Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175, 178, where it is pointed out that the use of the project in the cited case was mainly for private purposes. In the Thomas case the Minnesota Court holds that:
"The fundamental purpose of the state in the enactment of the Municipal Housing and Redevelopment Act * * * is to protect the health, safety, and general welfare of the public. The elimination of slums and the erection of safe and sanitary low-rent dwelling units for persons of the prescribed restrictive incomes referred to in the act will do a great deal to advance the public welfare and protect public safety and morals and will result in a direct benefit and advantage to all the people. The contemplated taking of property for low-rent housing under the facts and circumstances here, as provided in the act, constitutes a taking for public use, and the exercise of the power of eminent domain, as provided in the act, is not a violation of Minn.Const. art. 1, § 13."
The appellant quotes In re Opinion of the Justices, 211 Mass. 624, 98 N.E. 611, 42 L.R.A.,N.S., 221, to the effect that a prior Massachusetts law providing for housing at public expense was held unconstitutional as not being for a public purpose. That case, however, is distinguished in the later case of Allydonn Realty Corp. v. Holyoke Housing Authority, 304 Mass. 288, 23 N.E.2d 665, 669. The court there said that the law involved in the former case "* * * was not a slum clearance law. It did not eliminate unsafe or unsanitary dwellings. * * * Any effect that it might have in preserving the public safety, health, and morals was incidental, remote and doubtful." The Massachusetts Court in this later case had for consideration the Massachusetts Housing Authority Law, similar to our statute and said: "The real purpose of the statute is therefore the elimination of slums and unsafe and unsanitary dwellings, and the provision by public funds of low-rent housing is only a means by which *860 the main object is to be accomplished. The statute as a whole is designed to serve a public need, and the money expended for low-rent housing, as well as that expended for slum clearance, is for a public use."
In United States v. Certain Lands in City of Louisville, 6 Cir., 1935, 78 F.2d 684, 687, cited by plaintiff, it was held that the federal government could not condemn private property for low cost housing and slum clearance and to reduce unemployment, and that the NIRA was unconstitutional insofar as it authorized such condemnation since it was not for a public use. However, the decision admitted:
"What is a public use under one sovereign may not be a public use under another. * * * The state and federal governments are distinct sovereignties, * * *. In the exercise of its police power a state may do those things which benefit the health, morals, and welfare of its people. The federal government has no such power within the states."
This case was decided by a divided court and the decision contains a strong dissent by Judge Allen. In more recent cases, courts of equal dignity have considered the use to be public, Oklahoma City v. Sanders, 10 Cir., 1938, 94 F.2d 323; Keyes v. United States, 1941, 73 App.D.C. 273, 119 F.2d 444, and have upheld the constitutionality of the present federal act, Keyes v. United States, supra; City of Cleveland v. United States, 323 U.S. 329, 65 S. Ct. 280, 89 L. Ed. 274.
Other cases cited by the appellant are not in point. They do not involve slum clearance projects.
The real purpose of both the State and Federal Acts is to combat slum conditions and overcome them for the protection, not only of the inhabitants therein but the public at large. That is a public purpose.
With that in veiw the State Act authorizes the Housing Authority to construct sanitary buildings with the aid afforded under the Federal Act and declares such property to be "public property used for essential public and governmental purposes * * *." Section 23-1129. We find that declaration correct.
The following cases deal generally with the purpose and constitutionality of our housing laws and support our decision thereon: Knoxville Housing Authority v. City of Knoxville, 174 Tenn. 76, 123 S.W.2d 1085; State ex rel. Porterie v. Housing Authority of New Orleans, 190 La. 710, 182 So. 725; Allydonn Realty Corp. v. Holyoke Housing Authority, 304 Mass. 288, 23 N.E.2d 665; Opinion to the Governor, 76 R.I. 249, 69 A.2d 531; State ex rel. Helena Housing Authority v. City Council of City of Helena, 108 Mont. 347, 90 P.2d 514; Dornan v. Philadelphia Housing Authority, 331 Pa. 209, 200 A. 834; Williamson v. Housing Authority of Augusta, 186 Ga. 673, 199 S.E. 43; McNulty v. Owens, 188 S.C. 377, 199 S.E. 425; Marvin v. Housing Authority of Jacksonville, 133 Fla. 590, 183 So. 145; Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175; New York City Housing Authority v. Muller, 270 N.Y. 333, 1 N.E.2d 153, 105 A.L.R. 905; Blakemore v. Cincinnati Metropolitan Housing Authority, 74 Ohio App. 5, 57 N.E.2d 397; Nashville Housing Authority v. City of Nashville, 192 Tenn. 103, 237 S.W.2d 946.
Since the purpose for which the housing authorities would take property by right of eminent domain is public it follows that the provisions of the State Act, § 23-1111(14) and § 23-1117, giving the authorities such power is not contrary to Article I, § 14 of the state constitution nor the 14th amendment of the U. S. Constitution. See Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175.
The plaintiff complains that the condemnation of land for new housing outside the slum area as in the instant case could not be held to be for a public purpose and therefore violates said sections of the state and federal Constitutions. If that were so, the purpose of the Act would in many instances be thwarted. There may be many reasons why the new project should not be built in the slum area, such *861 as the topography, drainage and lack of space. In the case of Chapman v. Huntington Housing Authority, 121 W.Va. 319, 3 S.E.2d 502, 509, the court says:
"The projects may be built in any area within the exercise of sound discretion of the federal and state authorities and the council of the City of Huntington, whether slum or not slum. They are simply low-cost-housing projects, incidental to slum clearance. In some cities it is quite conceivable that slums exist in low-water areas. Equally, it is quite inconceivable that public moneys in large amounts should be expended to build modern dwelling units where they will be subject to and endangered by rising waters."
In Riggin v. Dockweiler, 15 Cal. 2d 651, 104 P.2d 367, the court said:
"In working out the problem of low-cost housing, it may appear that the clearance of a slum area is desirable because the dwellings in use are insanitary, or present fire hazards or are maintained under such conditions that their removal would be in the interest of the public welfare. Also, the location may be an undesirable one for dwellings. Where such circumstances exist, it would be folly to require the new buildings to be constructed at the old location, and compel the new units to be crowded into the space taken up by those cleared away. Such an interpretation of the housing act would thwart the very purposes for which it was passed and effectively block slum clearance in districts where the problem is most acute." See also Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175, 188; Keyes v. United States, 73 App.D.C. 273, 119 F.2d 444, Id., 314 U.S. 636, 62 S. Ct. 70, 86 L. Ed. 510.
Plaintiff also claims the housing proposed will be in competition with his rental properties in the neighborhood and in that manner deprive him of income and property without due process of law contrary to the 14th amendment of the United States Constitution. There is no merit to the contention. It has been held that governmental competition with owners of private business does not constitute legal damage even though it may injure their business. Neither the federal nor state Constitution grants any right to plaintiff to be free from competition. Woodworth v. Gallman, 195 S.C. 157, 10 S.E.2d 316, 321; Alabama Power Co. v. Ickes, 58 S. Ct. 300, 302 U.S. 464, 82 L. Ed. 374; Tennessee Electric Power Co. v. T. V. A., 306 U.S. 118, 59 S. Ct. 366, 83 L. Ed. 543; Spahn v. Stewart, 268 Ky. 97, 103 S.W.2d 651.
Plaintiff contends that the act delegates legislative power to the Housing Authority contrary to Article II, § 25 of the constitution. This court has repeatedly held that legislative power cannot be delegated. State v. Budge, 14 N.D. 532, 105 N.W. 724; State ex rel. City of Fargo v. Wetz, 40 N.D. 299, 168 N.W. 835, 5 A.L.R. 731. It must clearly appear, however, that the power attempted to be delegated is legislative. Wilder v. Murphy, 56 N.D. 436, 440, 218 N.W. 156, and cases cited. However, the determination of the facts upon which the law becomes operative may be delegated.
"The legislature * * * may confer discretion in the administration of the law, and the constitution has never been regarded as denying to the legislature the necessary resources of flexibility and praticality which will enable it to perform its function in laying down policies and establishing standards, while leaving to selected instrumentalities the making of subordinate rules within prescribed limits and the determination of facts to which the policy as declared by the legislature is to apply, and the legislature may make a law to delegate a power to determine some fact or state of things upon which the law makes or intends to make its own action depend. The true distinction is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring an authority or discretion as to its execution, to be exercised under and in pursuance of the law; the first cannot be done, to *862 the latter no valid objection can be made." 16 C.J.S., Constitutional Law, § 133, pages 340-341.
In a very thorough discussion of this subject in Picton v. County of Cass, 13 N.D. 242, 100 N.W. 711, 713, Judge Young quotes with approval from Locke's Appeal, 72 Pa. 491, 13 Am.Rep. 716, as follows:
"The Legislature cannot delegate its power to make a law, but it can make a law to delegate a power to determine some fact or state of things upon which the law makes, or intends to make, its own action depend. To deny this would be to stop the wheels of government. There are many things upon which wise and useful legislation must depend which cannot be known to the lawmaking power, and must therefore be a subject of inquiry and determination outside of the halls of legislation."
In the case of Enderson v. Hildenbrand, 52 N.D. 533, 204 N.W. 356, 363, involving the finding by a city council of the facts required for the exclusion of farm land from a city, this court said:
"The Legislature has prescribed certain general, definite rules applicable in all cases as to what territory is to be excluded from cities, and authorized the city council (or commission) to ascertain and determine in each case whether it does or does not fall within the rule established by the Legislature. This does not constitute a delegation of legislative powers in contravention of the constitutional inhibition. 6 R.C.L. pp. 175, 176. For it is competent for the Legislature to pass a law, the ultimate operation of which may, by its own terms, be made to depend on a contingency." (Cases cited.)
In the case of Housing Authority of Los Angeles County v. Dockweiler, 14 Cal. 2d 437, 94 P.2d 794, 807, the court in passing on a housing authority law almost identical with the North Dakota act, says:
"The standards specified in the act are sufficiently definite. * * * The statute is complete in itself. While the legislature cannot delegate the power to make a law, it cannot now be seriously disputed that it may delegate to administrative boards and agencies the power and authority of ascertaining and determining the facts upon which the laws are to be applied and enforced." See also Chapman v. Huntington Housing Authority, 121 W.Va. 319, 3 S.E.2d 502.
An analysis of the State Act shows that it creates a housing authority but leaves to the local authorities the finding of the facts upon which the law can be activated. It makes provisions for the organization of the housing authority and defines its powers. It provides that in the operation and management of the housing projects no profit shall be made and that the rentals be kept as low as possible consistent with safe and sanitary dwellings. The authority shall select as tenants persons of low income but with ability to pay the rentals fixed, and definite rules for fixing the rentals, § 23-1113 NDRC 1943, and for the selection of tenants, § 23-1114 NDRC 1943, are laid down. The law provides adequate guides for its administration but delegates no legislative power to local authorities. See Anderson v. Peterson, N.D., 54 N.W.2d 542.
It is next claimed that these provisions for the administration of the Act grant special privileges to a limited class, violating Article I, § 20 of the Constitution, which provides:
"No special privileges or immunities shall ever be granted which may not be altered, revoked or repealed by the legislative assembly; nor shall any citizen or class of citizens be granted privileges or immunities which upon the same terms shall not be granted to all citizens."
This constitutional provision does not prohibit appropriate legislative classification where proper facts justify such action as long as the act applies uniformly to all those within the class under similar circumstances. Any classification is permissible which has a reasonable relation to some permitted end of governmental action. Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175, 189, *863 and cases cited. Ability to pay appears to the courts to be proper consideration to justify classification. Reed v. Bjornson, 191 Minn. 254, 253 N.W. 102, 108.
In the case of Vermont Loan & Trust Co. v. Whithed, 2 N.D. 82, 94, 49 N.W. 318, 320, this court said:
"the legislature has power to classify persons and subjects for the purpose of legislation, and to enact laws applying specially to such classes, and, while the laws thus enacted operate uniformly upon all members of the class, they are not vulnerable to the constitutional inhibition under consideration. But this power of the legislature is circumscribed. It is not an arbitrary power, waiting the will or the whim of the legislature. Its exercise must always be within the limits of reason, and of a necessity more or less pronounced. Classification must be based upon such differences in situation, constitution, or purposes, between the persons or things included in the class and those excluded therefrom, as fairly and naturally suggest the propriety of and necessity for different or exclusive legislation in the line of the statute in which the classification appears." See also State ex rel. Amerland v. Hagan, 44 N.D. 306, 175 N.W. 372; Klein v. Hutton, 49 N.D. 248, 191 N.W. 485.
In the case of Housing Authority of City of Dallas v. Higginbotham, 135 Tex. 158, 143 S.W.2d 79, 85, 130 A.L.R. 1053, the Texas Court, having a housing law similar to ours under consideration, says on this subject:
"The legislature in the instant law under attack has made no attempt to grant special privileges to any man or set of men, but has made a reasonable classification of the members of the public and has provided that such low rent dwelling accommodations shall be available to all members of the public who presently or in the future fall within the classification made by the legislature. Such class legislation has been uniformly upheld in this state, provided there is any reasonable basis which would justify the classification." (Cases cited.)
In Williamson v. Housing Authority, 18 Ga. 673, 199 S.E. 43, 47, the court said:
"The argument is that the actual benefits to be derived from the proposed slum-clearance and low-cost housing project are limited to those individuals or families `who lack the amount of income which is necessary to enable them, without financial assistance, to live in safe and sanitary dwellings without overcrowding,' and that thus the housing act provides special privileges and advantages for a particular group to be selected from persons occupying a certain economic and financial status, to the exclusion of other citizens who by arbitrary standards occupy a different situation. It might also be claimed that the actual benefits derived from maintaining the * * * Academy for the Blind are limited to blind children; or that the actual benefits of the * * * State Sanitarium are limited to those mentally diseased; or that adults are denied the actual benefits of the public school system because the schools are maintained only for children between certain ages; and that therefore, since they provide privileges and advantages only for a particular group, their maintenance by the State is contrary to our organic law. It is no violation of the constitutional guaranty here invoked for the State to provide direct benefits for a certain group, to the exclusion of other citizens, unless done by arbitrary standards. The governing authorities were well justified in limiting to those of moderate income the benefits of the legislation under discussion. The statute makes a classification and states the basis thereof, which can not be said by this court to be unreasonable."
The State Act is enacted for the benefit of people of low income. It prescribes rules for determining the limit of income under which the benefits are available. The benefits of the act are open to all people under that limit. The act grants *864 no privileges to a favored few. All persons similarly situated are given the same opportunity under the State Act to the extent of the facilities provided. See also Fradet v. City of Southwest Fargo, N.D., 59 N.W.2d 871.
It is next contended by the plaintiff that the State Act is a special law in contravention of the Constitution, Article II, § 69 (33), which provides that the legislature shall pass no special law for the "Incorporation of cities, towns or villages, or changing or amending the charter of any town, city or village."
The State Act creates in each city of more than 5000 population and in each county of the state a public body corporate and politic to be known as the Housing Authority. Under the law such Housing Authority exists in every such city and every county by the legislative mandate and is available whenever the local authorities find the facts necessary for its activation.
This court in Vermont Loan & Trust Co. v. Whithed, 2 N.D. 82, 49 N.W. 318, 320, has pointed out the distinction between a general and a special law as follows:
"`A statute relating to persons or things as a class is a general law; one relating to particular persons or things of a class is special.' * * * `Special laws are those made for individual cases, or for less than a class requiring laws appropriate to its peculiar condition and circumstances.' * * * A `general law,' as the term is used in this constitutional provision, is a public law of universal interest to the people of the state, and embracing within its provisions all the citizens of the state, or all of a certain class or certain classes of citizens. It must relate to persons and things as a class, and not to particular persons or things of a class. It must embrace the whole subject, or a whole class, and must not be restricted to any particular locality within the state. * * * The uniform operation required by this provision does not mean universal operation. A general law may be constitutional, and yet operate in fact only upon a very limited number of persons or things, or within a limited territory. But, so far as it is operative, its burdens and its benefits must bear alike upon all persons and things upon which it does operate, and the statute must contain no provision that would exclude or impede this uniform operation upon all citizens, or all subjects and places, within the state, provided they were brought within the relations and circumstances specified in the act."
Certainly the Housing Act operates alike on all places and persons that come within its provisions and is not a special law. 2 Sutherland, Statutory Construction, 5. See Humphrey v. City of Phoenix, 55 Ariz. 374, 102 P.2d 82; Williamson v. Housing Authority, 186 Ga. 673, 199 S.E. 43; Krause v. Peoria Housing Authority, 370 Ill. 356, 19 N.E.2d 193; Spahn v. Stewart, 268 Ky. 97, 103 S.W.2d 651; In re Brewster Street Housing Site, 291 Mich. 313, 289 N.W. 493; Rutherford v. City of Great Falls, 107 Mont. 512, 86 P.2d 656; New York City Housing Authority v. Muller, 270 N.Y. 333, 1 N.E.2d 153, 105 A.L.R. 905; Dornan v. Philadelphia Housing Authority, 331 Pa. 209, 200 A. 834; Housing Authority of City of Dallas v. Higginbotham, 135 Tex. 158, 143 S.W.2d 79 and 95, 130 A.L.R. 1053.
Plaintiff further contends that the State Act in establishing a "public body corporate and politic" empowered to exercise public essential governmental functions is in violation of Article VI, § 130 of the Constitution, which provides:
"The legislative assembly shall provide by general law for the organization of municipal corporations restricting their powers as to levying taxes and assessments, borrowing money and contracting debts, and money raised by taxation, loan or assessment for any purpose shall not be diverted to any other purpose except by authority of law."
Under this section of the Constitution the legislature provides for the organization of municipal corporations and fixes their powers. There is nothing in the *865 wording of this section of the constitution restricting the legislature in the exercise of that duty. It may limit such powers or withdraw any power vested in the municipality and place it with another public agency if it so desires. It may provide that two such agencies carry out the same powers in conjunction. People ex rel. Tuohy v. City of Chicago, 399 Ill. 551, 78 N.E.2d 285. In Monaghan v. Armatage, 218 Minn. 108, 112, 15 N.W.2d 241, 243, the court said:
"A municipality is merely a department of the state, a political subdivision created as a convenient agency for the exercise of such governmental powers as may be entrusted to it. City of Trenton v. [State of] New Jersey, 262 U.S. 182, 43 S. Ct. 534, 67 L. Ed. 937, 29 A.L.R. 1471. Absent constitutional restriction, the legislature may at its pleasure modify or withdraw any powers so entrusted to a city, hold such powers itself, or vest them in other agencies. Hunter v. City of Pittsburgh, 207 U.S. 161, 178, 179, 28 S. Ct. 40, 46, 52 L. Ed. 151, 159, * * *."
This is cited with approval in the case of Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175. The housing authority is activated by action of the municipal authority to carry on specific public projects in cooperation with the municipal authority. There is no conflict between them nor any conflict with the constitution.
Plaintiff claims the State Act violates Article XI, § 178 of the Constitution of North Dakota, which provides: "The power of taxation shall never be surrendered or suspended by any grant or contract to which the state or any county or other municipal corporation shall be a party." and Article II, § 69, which provides: "The legislative assembly shall not pass local or special laws * * *. 29. Exempting property from taxation." and finally, Article XI, § 176, which requires that "Taxes shall be uniform upon the same class of property * * *."
Plaintiff bases all these objections on the grounds that the purposes of the housing act are private rather than public and that all the property of the Housing Authority is private property. We have found to the contrary so that his argument fails.
The Housing Authority is created "a public body corporate and politic." Section 23-1102 NDRC 1943. It is a public corporation for public purposes. Article XI, § 176 of the State Constitution provides, in part:
"The property of the United States and of the state, county and municipal corporations and property used exclusively for schools, religious, cemetery, charitable or other public purposes shall be exempt from taxation." (Emphasis added.)
Section 57-0208 (3) NDRC 1943 provides:
"All property, real or personal, belonging to any county, city, village, park district, township, school district, or to any other municipal corporation" shall be exempt from taxation.
Section 23-1129 NDRC 1943 provides:
"The property of an authority is declared to be public property used for essential public and governmental purposes and shall be exempt from all taxes and special assessments of the city, the county, the state or any political subdivision thereof. * * *"
It is clear that the legislative intent is that any property held by a housing authority, a public corporation, for public purposes shall be exempt from taxation. The constitutional and legislative declarations are definite that property held exclusively for "public purposes" shall be exempt from taxation. State ex rel. Linde v. Packard, 35 N.D. 298, 317, 160 N.W. 150, L.R.A. 1917B, 710.
In Housing Authority of Los Angeles County v. Dockweiler, 14 Cal. 2d 437, 453, 94 P.2d 794, 802, the court says:
"Section 4 of the Housing Authorities Law, * * * defines an authority as `a public body, corporate and politic'. Such an authority is not unlike an irrigation district which, though *866 held not to be a municipal corporation within the meaning of the quoted constitutional provision, has been held to be a public corporation for municipal purposes whose property is exempt from taxation. Turlock Irrig. Dist. v. White, 186 Cal. 183, 198 P. 1060, 17 A.L.R. 72; Anderson-Cottonwood Irrig. Dist. v. Klukkert, 13 Cal. 2d 191, 88 P.2d 685. Similarly reclamation districts have been declared to be public agencies whose properties are likewise exempt from taxation. Reclamation Dist. [No. 551] v. County of Sacramento, 134 Cal. 477, 66 P. 668. In Laguna Beach [County] Water Dist. v. Orange County, 30 Cal. App. 2d 740, 87 P.2d 46, 47, it is stated that `It must be conceded that it has always been the policy of the law in California since the adoption of the present Constitution, to exempt from taxation property of the state and state agencies generally classified as public corporations'. Moreover, while provisions exempting private property from taxation are to be strictly construed, the rule is otherwise as to public property which is to be taxed only if there is express authority therefor. [City of] Pasadena v. County of Los Angeles, 182 Cal. 171, 174, 187 P. 418."
Plaintiff argues that paying ten per cent of the shelter rents to the local government is an invalid attempt to compromise taxes for an amount less than the full taxes, in violation of the constitutional requirement that "Taxes shall be uniform", and also an attempted suspension of the power of taxation, in violation of Article XI, § 176 of the State Constitution. These contentions are pyramided upon prior contentions that the purpose is not public and that the tax exemption is invalid. Since both those points have been decided against the plaintiff, there is no base upon which to uphold this contention. The property of the Housing Authority is expressly exempted from taxation. Hence, there can be no question of the surrender or suspension of the power to tax on the part of the City. Furthermore, the payment of a percentage of the shelter rents has no bearing, either expressly or by implication, on the subject of tax exemption of property of the Authority. The payment of a percentage of the shelter rents to the municipality is merely reimbursement for the services which the municipality must necessarily render to the project. See Thomas v. Housing & Redevelopment Authority, 234 Minn. 221, 48 N.W.2d 175; McNulty v. Owens, 188 S.C. 377, 199 S.E. 425.
In Belovsky v. Redevelopment Authority, 357 Pa. 329, 54 A.2d 277, 284, 172 A.L.R. 953, it is said:
"The provision of the Redevelopment Cooperation Law that any city, borough, town, township or county may contract with a Redevelopment Authority with respect to any sums which the Authority may agree to pay for special improvements, services and facilities to be provided by such city, borough, town, township or county for the benefit of the redevelopment, does not, either expressly or impliedly, have any bearing on, or relation to the subject of tax exemption of property within the redevelopment area."
Plaintiff then attacks the provision that no lien shall attach to the project or its assets upon failure to make the agreed payment.
Since the housing authority is a public body, its officers are public officers. This court will not assume that public officers will not do their duty, such as refusing to make payment for services. Furthermore, should the housing authority's officers fail or refuse to make the agreed payments, they could be compelled to do so through mandamus, or mandatory injunction buttressed by contempt proceedings. A lien cannot attach to housing authority property any more than it could to any other public property.
Since the purpose is public, and the property publicly owned, there is no ground for the argument made by plaintiff that the Housing Act results in taking property off the tax rolls. Cox v. City of Kinston, 217 N.C. 391, 8 S.E.2d 252, 257. On the other hand, it is contended that the removal of the slum area and its contaminating *867 effects will cause a rise in property values and tax income at all levels of government.
Although he did not seriously urge it on appeal, plaintiff alleged in his complaint that the housing authority bonds would constitute debts of the county in excess of the constitutional limitation in Article XII, § 183, and would also contravene the prohibition in the same section against increasing the bonded indebtedness of the county without a majority vote, to acquire a "revenue producing utility". Section 23-1120, NDRC 1943, expressly provides three alternative methods by which the housing authority can pay off the bonds and interest thereon, and then unequivocally and explicitly states that "The bonds and other obligations of the authority shall not be payable out of any funds or properties other than those of the authority." By the terms of this statute no liability for the project can be imposed upon the county or city. Redmon v. Chacey, 7 N.D. 231, 73 N.W. 1081. In jurisdictions having substantially the same constitutional provisions and housing-slum clearance statutes as in the case at bar, it has been held unanimously that the bonds of housing authorities do not constitute an indebtedness of the local government within the meaning of the Constitution. With these we are in full agreement.
Furthermore, plaintiff alleges that the city is pledging its credit in support of the housing project contrary to Article XII, § 185 of the State Constitution, which provides that "* * * neither the state nor any political subdivision thereof shall otherwise loan or give its credit or make donations to or in aid of any individual, association or corporation except for reasonable support of the poor, * * *." The housing project is financed by federal government aid and by the issue of bonds for neither of which the city's credit is pledged, nor is the city in any way liable. Redmon v. Chacey, supra; Rutherford v. City of Great Falls, 107 Mont. 512, 86 P.2d 656; Dornan v. Philadelphia Housing Authority, 331 Pa. 209, 200 A. 834; State ex rel. Porterie v. Housing Authority of New Orleans, 190 La. 710, 182 So. 725; Marvin v. Housing Authority of Jacksonville, 133 Fla. 590, 183 So. 145; McNulty v. Owens, 188 S.C. 377, 199 S.E. 425; Williamson v. Housing Authority of Augusta, 186 Ga. 673, 199 S.E. 43; Housing Authority of Los Angeles County v. Dockweiler, 14 Cal. 2d 437, 94 P.2d 794; Edwards v. Housing-Authority of Muncie, 215 Ind. 330, 19 N.E.2d 741; Krause v. Peoria Housing Authority, 370 Ill. 356, 19 N.E.2d 193; Belovsky v. Redevelopment Authority, 357 Pa. 329, 54 A.2d 277, 172 A.L.R. 953; Humphrey v. City of Phoenix, 55 Ariz. 374, 102 P.2d 82; McLaughlin v. Housing Authority of Las Vegas, Nev., 227 P.2d 206; Mumpower v. Housing Authority of Bristol, 176 Va. 426, 11 S.E.2d 732, and others.
Plaintiff also contends that the State Act violates Article IV, § 85, of the Constitution providing that the judicial power shall be vested in the courts and Article I, § 22, providing the courts shall be open and every man for any injury done him shall have a remedy by due process of law. In support of that he cites § 23-1104 NDRC 1943 providing that in any proceeding involving the validity or enforcement of any contract of the authority, "the authority shall be conclusively deemed to have become established and authorized to transact business and exercise its powers hereunder upon proof of the adoption of a resolution by the governing body of the city or county declaring the need for the authority." This provision he claims gives the city or county board judicial power and shuts anyone questioning the organization of the authority out of court.
The legislature determined by section 23-1103 NDRC 1943 the method of activating the housing authority created by section 23-1102 NDRC 1943. It delegated to the governing body of a city or county the finding of the facts necessary for the activation of the housing authority. That body finds the facts but passes no judgment thereon. It is given no judicial power. Then by section 23-1104 NDRC 1943 the legislature declared that, on the proof of the adoption of the resolution containing the finding of the facts necessary under section 23-1103 NDRC 1943 for the activation of the authority, the authority shall *868 be conclusively deemed to have been established and authorized to transact business. The legislature declared that the proof of the resolution conclusively presumed that the necessary facts were found by the governing body.
Generally the legislature alone determines the facts upon which legislation is passed. The mere passing of the legislation is taken as the proof of such finding. Usually the presumption of the correctness of such facts is regarded as conclusive unless an abuse of discretion is shown. In 11 Am.Jur., Constitutional Law, § 142, p. 820, it is said:
"As a general rule it may be stated that the determination of facts required for the proper enactment of statutes is for the legislature alone, that the presumption as to the correctness of its findings is usually regarded as conclusive unless an abuse of discretion can be shown, and that the courts do not generally have jurisdiction or power to reopen the question or make new findings of fact." See also State ex rel. Sullivan v. Dammann, 227 Wis. 72, 277 N.W. 687; Ex parte Yun Quong, 159 Cal. 508, 114 P. 835, Ann. Cas.1912C, 969.
In the instant case the legislature made a determination of the existence of slum conditions in this state when it passed the Housing Authorities Act. It had the power to make that finding conclusive for every authority established. Instead it delegated to the city or county authorities, who may be presumed to have better knowledge thereof, the final finding of the facts in each locality and made their findings conclusive. It had the authority to do that. The findings so made cannot, under the circumstances shown in this case, be questioned in the courts. This provision in the law is not violative of Article IV, § 85 or Article I, § 22 of the State Constitution.
In the case of Cox v. City of Kinston, 217 N.C. 391, 8 S.E.2d 252, 257, the court had for consideration a similar feature of the law creating the North Carolina Housing Authority. The court came to the same conclusion as we have, although for somewhat different reasons. The court said:
"The statute provides: In any suit, action or proceeding involving the validity or enforcement of or relating to any contract of the authority, the authority shall be conclusively deemed to have been established in accordance with the provisions of this article upon proof of the issuance of the aforesaid certificate by the secretary of state'. We regard this as a perfectly legitimate provision, and similar provisions for the purpose of quieting litigation have often been sustained by the Court. It does not assume judicial power by preventing or curtailing its exercise by the courts. It simply bars an attack on the procedure after a certificate of incorporation has been obtained from the Secretary of State. * * * It was, therefore, competent to cure unessential defects in the procedure which the lawmaking body might have seen fit to omit imprimis."
A similar rule was followed in the cases of Woodworth v. Gallman, 195 S.C. 157, 10 S.E.2d 316, and Knoxville Housing Authority v. City of Knoxville, 174 Tenn. 76, 123 S.W.2d 1085.
The plaintiff claims that the title to the Housing Authorities Act as enacted in Chapter 102 S.L.1937 violates Article 2, § 61 of the constitution which provides that: "No bill shall embrace more than one subject, which shall be expressed in its title, * * *." His contention is that the provision of the state act conferring upon the housing authorities the power of eminent domain is not expressed in the title of the said act.
On examining the title of the original act, Chapter 102 S.L.1937 we find that the purpose expressed in the title is the creation of housing authorities, defining their powers and providing for the exercise of such powers "including acquiring property". Eminent domain is certainly germane to the acquiring of property and is, therefore, within the title according to the decisions of this court. See State ex rel. Weeks v. Olson, 65 N.D. 407, 259 N.W. 83; State ex rel. Gammons v. Shafer, *869 63 N.D. 128, 246 N.W. 874; Thompson Yards v. Kingsley, 54 N.D. 49, 208 N.W. 949; State ex rel. Kol v. North Dakota Children's Home Society, 10 N.D. 493, 88 N.W. 273.
In this case, however, the question raised becomes immaterial because the original act, Chapter 102 S.L.1937, together with its title was repealed by the enactment of the North Dakota Revised Code 1943, § 1-0219. In the Code that chapter was reenacted as Chapter 23-11 under the proper title for the whole code. We have held that a statute, even if it fails to comply with the provision of section 61 of the Constitution becomes valid upon its incorporation in the North Dakota Revised Code duly adopted as such. Lapland v. Stearns, N.D., 54 N.W.2d 748, 59 C.J.Statutes, § 376, p. 799; J. P. Schaller & Co. v. Canistota Grain Co., 32 S.D. 15, 141 N.W. 993.
"Where a section of a legislative act has been incorporated in the Revised Codes and adopted as a part of the complete statutes of the state, the court will not inquire into or consider the sufficiency of the original title of the act in which such section was originally adopted by the Legislature. In such case, it is too late to raise the sufficiency of the title to the original act, which was adopted prior to the date of its incorporation and adoption in the Revised Codes of the state." Anderson v. Great Northern Railway Co., 25 Idaho 433, 138 P. 127, 128.
Plaintiff contends that the housing authorities act grants special privileges. It was enacted in 1937 as an emergency measure. Therefore plaintiff claims that the act violates Article II, § 67 of the constitution which provides that no act of the legislative assembly shall take effect until July 1st after the close of the session unless the legislature by a two-thirds vote shall declare an emergency and then continues: "Provided, however, that no act granting a franchise or special privilege, or act creating any vested right or [one] other than in the state, shall be declared an emergency measure."
That section of the constitution relates only to the time when an act goes into effect. Even if that emergency clause is attached to a law granting special privilege that does not affect the act but only the validity of the emergency clause. As the time has long passed for the act to go into effect without the emergency clause the question of the validity of the emergency clause is not in issue here. Strange v. Levy, 134 Md. 645, 107 A. 549; Dinneen v. Rider, 152 Md. 343, 136 A. 754; State ex rel. v. Coos County, 115 Or. 300, 237 P. 678.
Furthermore, we have held that the state housing authorities act is not legislation granting any special privilege so that the emergency clause cannot affect it anyhow. There is no conflict with Article II, § 67 of the constitution.
It is finally claimed that there is no specific provision in the state housing act granting authority to the city to cooperate with the housing authority and that, therefore, the cooperative agreement is beyond the power of the city and void.
In the original housing authority law, Chapter 102 S.L.1937 there is no specific provision for the cooperation of the city with the authority. Such cooperation, however, is implied and certainly can be exercised in as far as the general powers granted the city cover the matters upon which cooperation is desired. That the legislature so intended is shown by the amendments to the original housing authority act when it was extended to cover the building of sanitary dwellings for persons engaged in national defense and veterans of World Wars I and II. Chapter 217 S. L.1941 (Now Section 23-1133, NDRC 1949 Suppl.) and Chapter 191 S.L.1949. Those amendments granted the same right and power to the city, county or other public body to cooperate with the housing authority which they had for the purpose of assisting the development or administration of slum clearance or housing projects. Section 23-1133 1949 Supplement and Chapter 191 S.L.1949. See Fradet v. The City of Southwest Fargo, N.D., 59 N.W.2d 871.
*870 Section 40-0501 NDRC 1943, provides that the governing body of the municipality shall have the following amongst other powers:
"8. To lay out, establish, open, alter, repair, clean, widen, vacate, grade, pave, park, or otherwise improve and regulate the use of streets, alleys, avenues, sidewalks, crossings, and public grounds; * * * and
* * * * * *
"35. To prevent and provide for remedying any dangerous construction or condition of any building, enclosure, or manufactory * * * creating a fire hazard; to prevent a deposit * * * of ashes or refuse in unsafe places; and to require all buildings and places to be put and kept in a safe condition.
* * * * * *
"44. To declare what shall constitute a nuisance and to prevent, abate, and remove the same;
"45. To make regulations necessary or expedient for the promotion of health or for the suppression of disease".
"59. To accept aid from, cooperate and contract with, and to comply with and meet the requirements of any federal or state agency for the establishment, construction and maintenance of public works * * * and in furtherance thereof to acquire by purchase, lease, gift or condemnation the necessary lands, rights-of-way and easements for such projects, and to transfer and convey to the state or federal government, or any agency thereof, such lands, rights-of-way and easements in consideration of the establishment and construction of, and the public benefits which will be derived from any such project." (Chapter 284 S.L. 1947.) NDRC 1949 Supp. 40-0501.
Cities shall have the additional powers:
Section 40-0502. "13. To adopt a zoning ordinance * * *."
40-4701 NDRC 1943. "For the purpose of promoting health, safety, morals, or the general welfare of the community, the governing body of any city may regulate and restrict the height, number of stories, and size of buildings and other structures, the percentage of lot that may be occupied, the size of yards, courts, and other open spaces, the density of population, and the location and use of buildings, structures, and land for trade, industry, residence, or other purposes. Such regulations may provide that a board of adjustment may determine and vary the application of the regulations in harmony with their general purpose and intent and in accordance with general or specific rules therein contained."
Section 40-0501 NDRC 1949 Supp. "1. Ordinances. To enact or adopt all such ordinances, resolutions, * * * not repugnant to the constitution and laws of this state, as may be proper and necessary to carry into effect the powers granted to such municipality or as the general welfare of the municipality may require, and to repeal, alter, or amend the same. The governing body of a municipality may adopt by ordinance the conditions, provisions, and terms of a building code, a fire prevention code, a plumbing code, an electrical code, a sanitary code, or any other standard code which contains rules and regulations printed as a code in book or pamphlet form by reference to such code or portions thereof alone without setting forth in said ordinance the conditions, provisions, limitations, and terms of such code. * * *"
In connection with the objection to the cooperation agreement plaintiff first raises the question of the authority of the city to agree that it will not tax the property of the housing authority. That, however, is merely in accordance with the law. We have found that property of the authority is not subject to taxation.
The plaintiff then claims that the agreement violates Article 12, § 185 of the state constitution prohibiting the extension of credit or making donations in aid of any individual, association or corporation. *871 That is without merit since the local housing authority is a public corporation engaged in public work.
The plaintiff then objects to the provision that the city agrees to "vacate such streets, roads and alleys within the area of such project as may be necessary in the development thereof and convey without charge to local authority such interest as the municipality may have in such vacated areas." The authority for that, however, is provided in section 40-0501, (8) and (59).
The North Dakota Housing Authorities Law is constitutional. A city can enter into a cooperation agreement with a housing authority on matters which are within the general powers granted the city.
We have considered all of the objections to the cooperative agreement presented by the plaintiff. None of them are well taken. The plaintiff has failed to present any valid challenge to that agreement in this case. Other challenges have been considered and held to invalidate portions of the agreement in Fradet v. City of Southwest Fargo, currently decided. The plaintiff not being entitled to prevail on any points presented in this case, the judgment appealed from, in so far as it holds that the North Dakota Housing Authorities Law is constitutional and denies the plaintiff injunctive relief is affirmed.
MORRIS, C. J., and CHRISTIANSON, SATHRE and BURKE, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580792/ | 12 So. 3d 1265 (2009)
STATE of Florida, Appellant,
v.
Michael WATERMAN, Appellee.
No. 4D08-415.
District Court of Appeal of Florida, Fourth District.
July 1, 2009.
*1266 Bill McCollum, Attorney General, Tallahassee, and Mark J. Hamel, Assistant Attorney General, West Palm Beach, for appellant.
Carey Haughwout, Public Defender, and Elisabeth Porter, Assistant Public Defender, West Palm Beach, for appellee.
DAMOORGIAN, J.
The State of Florida timely appeals the trial court's downward departure sentence imposed on Michael Waterman on a charge of escape. In this appeal, the State argues that the trial court erred in granting Waterman a downward departure sentence pursuant to section 921.0026(2)(j), Florida Statutes (2008), because the record shows that his escape charge was not an isolated incident, one of the requirements for a mitigated sentence under that subsection of the statute. We agree and vacate Waterman's sentence on the charge and remand for resentencing.
By way of background, Waterman was charged with one count of escape, as well two counts of battery on a law enforcement officer and four misdemeanors, including a DUI. He entered an open no contest plea to all charges and moved to be sentenced as a youthful offender. His sentencing scoresheet showed a lowest permissible prison sentence of 23.625 months. *1267 The scoresheet also showed that Waterman has a criminal record consisting of misdemeanor charges for possession of cannabis, battery, petit theft, and trespass, and one felony charge for aggravated battery with a deadly weapon. In addition, defense counsel proffered that Waterman had a prior DUI conviction within twelve months of his current charges, although this conviction does not appear on his scoresheet.
At the conclusion of the sentencing hearing, the State recommended that Waterman be sentenced to five years in prison. The defense requested a youthful offender sentence consisting of a term of probation. With respect to the escape charge, the trial court denied the motion for a youthful offender sentence, and instead granted a downward departure, withheld adjudication, and sentenced Waterman to six months of community control followed by six and one-half years of drug offender probation. This downward departure sentence was based on the trial court's determination that the escape was committed in an unsophisticated manner and was an isolated incident for which Waterman had shown remorse. The trial court characterized Waterman's criminal record as "a serious background," "a terrible juvenile record," and a "[b]ad record." Nevertheless, the court expressed its desire to keep Waterman out of the adult prison system because "[h]e is not going to come out better." The State objected to the downward departure sentence.
The State argues that the trial court erred in granting Waterman a downward departure sentence because his escape charge was not an isolated incident. Waterman contends that all of his prior crimes occurred while he was a juvenile, so they should not be considered when determining whether his present crime was an isolated incident under section 921.0026(2)(j), Florida Statutes (2008).
The imposition of a downward departure sentence is a two-step process, described as follows:
First, the court must determine whether it can depart, i.e., whether there is a valid legal ground and adequate factual support for that ground in the case pending before it (step 1). Legal grounds are set forth in case law and statute, and facts supporting the ground must be proved at trial by a preponderance of the evidence. This aspect of the court's decision to depart is a mixed question of law and fact and will be sustained on review if the court applied the right rule of law and if competent substantial evidence supports its ruling.... Second, where the step 1 requirements are met, the trial court further must determine whether it should depart, i.e., whether departure is indeed the best sentencing option for the defendant in the pending case.
Banks v. State, 732 So. 2d 1065, 1067-68 (Fla.1999) (citations omitted). Section 921.0026(2)(j), Florida Statutes (2008), permits a trial court to depart from the lowest permissible sentence when "[t]he offense was committed in an unsophisticated manner and was an isolated incident for which the defendant has shown remorse." To support a downward departure based on this particular mitigator, all three elements must be shown: (1) the crime was committed in an unsophisticated manner, (2) the crime was an isolated incident, and (3) the defendant has shown remorse. State v. Gaines, 971 So. 2d 219, 220 (Fla. 4th DCA 2008).
The second element of the mitigatorthat the crime was an isolated incident *1268 is the focus of this appeal.[1] Neither the legislature nor the courts have established a bright-line rule for determining whether an offense is an isolated incident. See id. at 221. Instead, the courts have set forth the standard that "[a] defendant's extensive prior criminal record precludes a showing than an offense was `an isolated incident.'" State v. Ayers, 901 So. 2d 942, 945 (Fla. 2d DCA 2005); see, e.g., Gaines, 971 So.2d at 221 (where the defendant had eighteen prior convictions); State v. Stephenson, 973 So. 2d 1259, 1263-64 (Fla. 5th DCA 2008) (where the defendant had at least seventeen prior convictions). This standard applies even if the defendant's record does not include the same offense for which he is presently being sentenced. Ayers, 901 So.2d at 945; State v. Knox, 990 So. 2d 665, 669 (Fla. 5th DCA 2008).
A trial court is not, however, precluded from giving a defendant a downward departure sentence just because the defendant has any prior criminal history. See, e.g., State v. Fontaine, 955 So. 2d 1248, 1251 (Fla. 4th DCA 2007) (Warner, J., concurring) (the defendant's current offense was an isolated incident where his criminal record included two misdemeanors that were committed ten years earlier); State v. Randall, 746 So. 2d 550, 552 (Fla. 5th DCA 1999) (the defendant's current offense was an isolated incident where he had only one prior criminal conviction).
Thus, the issue for this Court is whether Waterman's criminal history is so extensive that it precludes a downward departure sentence under section 921.0026(2)(j), Florida Statutes (2008). Waterman's history consists of at least four misdemeanors, a felony aggravated battery with a deadly weapon for which he was sentenced about two years before he committed the current offenses, and a DUI that occurred less than a year before the current offenses. On one hand, his history is certainly not as extensive as the defendants in Ayers and Gaines, and the escape and accompanying charges were his first criminal charges as an adult. Nevertheless, his history is distinguishable from the defendants' histories in Fontaine and Randall because he has more than just one or two misdemeanor charges on his record. In addition, his history shows an emerging pattern of alcohol-related crimes, in that his current escape charge arose out of his second arrest for DUI within a year.
Waterman's record is more similar in scope to the defendant's record in State v. Tice, 898 So. 2d 268 (Fla. 5th DCA 2005). In Tice, the defendant's scoresheet indicated that he was previously convicted of resisting an officer without violence, two violations of probation, aggravated battery with a deadly weapon, and fleeing or attempting to elude a police officer. Id. at 269. Thus, the defendant's record fell somewhere in the middle of the spectrum of criminal records, where on one end lies the defendant with a clearly excessive record, and on the other end lies a defendant with no prior criminal record. The Fifth District Court of Appeal held that the defendant's record, while mid-spectrum, precluded his current offense from being labeled "isolated." See id. Thus, the statutory mitigator did not apply. Id. We agree with that analysis, and hold that Waterman's record is too extensive for his escape charge to be labeled "isolated" under section 921.0026(2)(j), Florida Statutes (2008).
Accordingly, there is not competent, substantial evidence to support the trial *1269 court's ruling that Waterman's escape charge was an isolated incident. His criminal history precludes him from receiving a downward departure sentence under section 921.0026(2)(j), Florida Statutes (2008). Moreover, his argument that one of the other statutory mitigators might apply is not supported by the record. Thus, the trial court erred in departing downward from the sentencing guidelines to sentence Waterman on Count 1, escape. We reverse Waterman's downward departure sentence for Count 1 and remand for resentencing.
Reversed and Remanded.
STEVENSON and HAZOURI, JJ., concur.
NOTES
[1] The State does not contest that Waterman committed the escape in an unsophisticated manner. The State does contend that Waterman did not show remorse for the escape, but admits that it did not preserve this issue for appellate review. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4151513/ | Security Pac. Natl. Bank v Evans (2017 NY Slip Op 01792)
Security Pac. Natl. Bank v Evans
2017 NY Slip Op 01792
Decided on March 9, 2017
Appellate Division, First Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Decided on March 9, 2017
Sweeny, J.P., Mazzarelli, Moskowitz, Kahn, JJ.
3360 22899/92
[*1]Security Pacific National Bank, Plaintiff-Respondent,
v Tracie Evans, Defendant-Appellant, Arnold Lepelstat, et al., Defendants.
Tracie Evans, appellant pro se.
Belkin Burden Wenig & Goldman, LLP, New York (Magda L. Cruz of counsel), for respondent.
Order, Supreme Court, New York County (Shlomo S. Hagler, J.), entered April 14, 2015, which, among other things, granted plaintiff's motion to strike defendant Tracie Evans's jury demand, unanimously affirmed, without costs.
The motion court properly determined that defendant has no right to a jury trial on the triable issues identified by this Court on a prior appeal (62 AD3d 512, 514 [1st Dept 2009]). Since both parties sought equitable relief — that is, specific performance of their settlement agreement or injunctive relief — defendant is not entitled to a jury trial (see Anesthesia Assoc. of Mount Kisco, LLP v Northern Westchester Hosp. Ctr., 59 AD3d 481, 482 [2d Dept 2009]; Trepuk v Frank, 104 AD2d 780, 781 [1st Dept 1984]; CPLR 4101, 4102[c]). Even if defendant now asserts a claim for money damages, and even if she were to withdraw her equitable claims, that would not revive or create a right to a trial by jury that was waived by asserting equitable claims with respect to the same transaction (see Zimmer-Masiello, Inc. v Zimmer, Inc., 164 AD2d 845, 846-847 [1st Dept 1990]; Trepuk, 104 AD2d 780; cf. CPLR 4102[c]).
We have considered defendant's remaining arguments and find them unavailing.
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
ENTERED: MARCH 9, 2017
CLERK | 01-03-2023 | 03-09-2017 |
https://www.courtlistener.com/api/rest/v3/opinions/1545432/ | 128 F.2d 227 (1942)
TRUCK DRIVERS' LOCAL NO. 421, INTERNATIONAL BROTHERHOOD OF TEAMSTERS, CHAUFFEURS, WAREHOUSEMEN AND HELPERS OF AMERICA
v.
UNITED STATES.
BLANKENSHIP
v.
SAME.
PFOHL
v.
SAME.
Nos. 12022-12024.
Circuit Court of Appeals, Eighth Circuit.
May 22, 1942.
*228 *229 C. I. McNutt, of Des Moines, Iowa (Joseph A. Padway, of Washington, D.C., and John Connolly, Jr., George E. O'Malley, and Irvin Schlesinger, all of Des Moines, Iowa, on the brief), for appellants.
Hugh B. Cox, Sp. Asst. to Atty. Gen. (Daniel B. Britt, Sp. Asst. to Atty. Gen., Thomas H. Daly and Robert Diller, Sp. Attys., both of Washington, D. C., Thurman Arnold, Asst. Atty. Gen., and Tobias E. Diamond, U. S. Atty., of Sheldon, Iowa, on the brief), for appellee.
Before THOMAS and JOHNSEN, Circuit Judges, and REEVES, District Judge.
*230 JOHNSEN, Circuit Judge.
A local labor union, its president, its financial secretary, and its business agent were indicted jointly with the operators of six dairy companies, for violating the Sherman Act as amended, 26 Stat. 209, 50 Stat. 693, 15 U.S.C.A. § 1, in conspiring to fix and maintain the retail selling price of milk, produced in the States of Iowa, Illinois and Wisconsin, and distributed, after being standardized, pasteurized and bottled by the dairy companies, in the "Dubuque area", consisting of the city of Dubuque, Iowa, its suburban territory, and the city of East Dubuque, Illinois. The president of the union died while the indictment was pending. All of the other defendants were tried jointly to a jury and were convicted. The conviction and sentence have become final as to the dairy operators. The union, its financial secretary, and its business agent have appealed.
The union had a membership of approximately 350 persons, consisting of milk drivers, inside dairy workers, "over-the-road" truck drivers, taxicab drivers, drivers of local coal, ice, laundry and bread trucks, warehousemen and others. It was an affiliate of the American Federation of Labor and had made union contracts with all of the dairy companies involved. It had a special "milkmen's division" of about 100 members, consisting of the milk drivers and other dairy workers, which held separate meetings from the general union, and whose actions and minutes were required to be approved by the union as a whole. The milk drivers were of two classes, though the distinction is not important here those who made deliveries in dairy company trucks, on a regular salary basis, and those who paid the dairy companies for the bottled milk and made deliveries in their own trucks, on a fixed differential.
There was evidence that the dairy companies in 1939 had held meetings among themselves and fixed the price at which the bottled milk would be sold at retail throughout the Dubuque area. The plants of five of the dairy companies involved were located in Dubuque, Iowa, and the plant of the sixth was located in Wisconsin. The minimum prices which the dairy companies as "handlers" were required to pay the farmers or producers of milk had been established for the Dubuque area by the Secretary of Agriculture, under the Agricultural Marketing Agreement Act of 1937, 50 Stat. 246, 247, 7 U.S.C.A. § 608c, but these orders did not control the retail selling prices of the handlers. At a meeting of the dairy companies held on September 15, 1939, it had been agreed to fix the retail selling price at 11 cents a quart, and this price was continued in effect by all of them until the latter part of July, 1940. On July 28, 1940, Sanitary Milk Company, which had joined with the six defendant dairy companies in the price-fixing meeting of September 15, 1939, broke away from the combination and announced, by newspaper advertisements and other public notices, that on the following day it would inaugurate a new "thrift plan" of selling, under which the consumer would pay 11 cents for the first quart of milk and 8 cents for each additional quart purchased on the same delivery. The efforts made to combat the placing and keeping of this thrift plan in operation prompted this indictment.
On the evening of the day that Sanitary announced its thrift plan to the public, the milkmen's division of the union held a special meeting at its headquarters and defendant dairy operators held a meeting at a local hotel. Both meetings were purportedly called "to discuss the thrift plan". The president of the union, who also apparently served as chairman of the milkmen's division, appointed a committee to attend the meeting of the dairy operators, for the purpose of ascertaining what they intended to do about the situation. There was evidence that the dairy operators told the milk drivers' committee that they "would go along 100% with any plan the union adopted to try and stop the thrift plan". The committee reported back to the milkmen's division that the dairy operators had agreed not to change the price of their milk and "had said that they would cooperate with the union if the union could try and stop the thrift plan".
The meeting then discussed various proposals for dealing with the thrift plan, including a general strike and a strike confined to the Sanitary Milk Company. In connection with the last proposal, the minutes show the adoption of a motion that any member taking a customer from the Sanitary drivers "until the trouble is brought to a satisfactory conclusion" and "for two weeks after a settlement is made" should be fined $100 and should not be allowed to return to work until the fine was paid. It was suggested that the Sanitary drivers should go to the plant and *231 advise the president of the company that they would not work unless the manager, who was responsible for the inauguration of the thrift plan, was fired and the plan was discontinued. Some of the drivers accordingly went to the Sanitary plant that same evening and declared that they had voted to strike, or would be obliged to do so, unless the thrift plan was abandoned and the previous price of milk was restored. The president and the manager of the plant protested against any attempt of the union to interfere with prices and assured the drivers that there would be no lay-offs or changes in the condition of their employment by reason of the adoption of the thrift plan. The thrift plan was placed in operation the following morning, and the drivers made no attempt to strike. As a matter of fact, no strike could properly have been called without the approval of the union as a whole.
The second evening following, the milkmen's division held another meeting, as did also the dairy operators. The milkmen's division adopted a resolution, which was regularly entered in its minutes, providing that any driver "taking a customer from the driver of another company" or taking "customers who have been buying from stores" should be fined $100. A committee was selected to handle any disputes that might arise in connection with the resolution. The chairman, who was the union president, again appointed a committee to attend the meeting of the dairy operators, for the purpose of advising them of the action which had been taken. The committee did so and reported back that "the handlers would cooperate 100 per cent". The following morning, when one of the drivers or distributors, who owned his own truck, inquired of one of the dairy operators "whether any permanent price policy had been determined", he was told: "The fine has been voted on the drivers, and I don't think there will be any disturbances or losing of customers. We had figured to bring the price down to 7 cents, but after that fine was voted, we changed our plan, and we will leave it at 11 cents. The Committee from the Union came down last night and told us the fine was voted, and that took care of everything."
The president of the union, who, as has been indicated, also acted as chairman of the milkmen's division, undertook to police the situation in order to prevent any of the Sanitary drivers from accepting customers of the other dairies. On August 7, 1940, he accused a driver named Rittenhouse of having violated the $100-fine resolution and instructed him to appear before the disputes committee which had been selected at the July 30th meeting. Rittenhouse appeared before the committee that same afternoon and explained that the dairy company had informed him at the time that the customer was a newcomer to the city. The disputes committee was advised by the business agent of the union that, in his opinion, it had no authority to impose a fine and that it ought therefore to refer the matter to the executive board of the union.
The president of the union then filed a written charge against Rittenhouse with the executive board of the union, and Rittenhouse was notified to appear for hearing on September 17, 1940. He did so and, after a hearing, the matter was purportedly taken under advisement by the executive board. The executive board never took any further action upon the charges, but Rittenhouse, of course, ceased to take on more new customers. About this time the Department of Justice began to investigate the Dubuque situation, and shortly thereafter the union "took the resolution off their records".
The principal contention of appellants here, as it was in the trial court, by attack upon the indictment and by motion for directed verdict, is in substance that the union, it officers and members could not be prosecuted under the Sherman Act for the activities involved, because of the provisions of sections 6 and 20 of the Clayton Act as amended, 38 Stat. 731 and 738, 15 U.S.C.A. § 17, 29 U.S.C.A. § 52, and the provisions of the Norris-LaGuardia Act, 47 Stat. 70-73, 29 U.S.C.A. §§ 101-115. It is unnecessary to set out here these familiar provisions of the Clayton and Norris-LaGuardia Acts. The general contention made has only recently been reexamined and again directly answered by the Supreme Court in Apex Hosiery Co. v. Leader, 1939, 310 U.S. 469, 487, 488, 60 S. Ct. 982, 988, 84 L. Ed. 1311, 128 A.L.R. 1044, where Mr. Justice Stone said: "A point strongly urged in behalf of respondents in brief and argument before us is that Congress intended to exclude labor organizations and their activities wholly from the operation of the Sherman Act. To this the short answer must be made that for the thirty-two years which have elapsed since the decision of Loewe v. Lawlor, 208 U.S. 274, 28 S. Ct. 301, 52 L. Ed. 488, 13 *232 Ann.Cas. 815, this Court, in its efforts to determine the true meaning and application of the Sherman Act has repeatedly held that the words of the act, `Every contract, combination * * * or conspiracy, in restraint of trade or commerce' do embrace to some extent and in some circumstances labor unions and their activities; and that during that period Congress, although often asked to do so, has passed no act purporting to exclude labor unions wholly from the operation of the Act. On the contrary Congress has repeatedly enacted laws restricting or purporting to curtail the application of the Act to labor organizations and their activities, thus recognizing that to some extent not defined they remain subject to it."
The Supreme Court has not undertaken to define the boundaries of the situations in which labor organizations may become subject to the operation of the Sherman Act, and perhaps no such limitative definition is possible or desirable. Its recent opinions have however contained some clear implicational expressions that touch the present situation. Thus, in Apex Hosiery Co. v. Leader, supra, at page 501 of 310 U.S., page 996 of 60 S.Ct., 84 L. Ed. 1311, 128 A.L.R. 1044, it was pointed out: "This is not a case of a labor organization being used by combinations of those engaged in an industry as the means or instrument for suppressing competition or fixing prices. See United States v. Brims, 272 U.S. 549, 47 S. Ct. 169, 71 L. Ed. 403; Local 167 v. United States, 291 U.S. 293, 54 S. Ct. 396, 78 L. Ed. 804." In United States v. Hutcheson, 312 U.S. 219, 232, 61 S. Ct. 463, 466, 85 L. Ed. 788, the Court, speaking through Mr. Justice Frankfurter, again implicationally declared: "So long as a union acts in its self-interest and does not combine with non-labor groups, the licit and the illicit under § 20 [of the Clayton Act] are not to be distinguished by any judgment regarding the wisdom or unwisdom, the rightness or wrongness, the selfishness or unselfishness of the end of which the particular union activities are the means."
In the Brims and Local 167 cases, cited in the quotation from the Apex Hosiery Co. case, supra, the Court, in affirming convictions under the Sherman Act against a labor and non-labor group, assumed the applicability of the Act to the labor group as part of the combination in the situations involved, but did not specifically discuss the question. In Bedford Cut Stone Co. v. Journeymen Stone Cutters' Association, 274 U.S. 37, 47 S. Ct. 522, 71 L. Ed. 916, 54 A.L. R. 791, the dissenting opinion of Mr. Justice Brandeis, concurred in by Mr. Justice Holmes, pointed out, at page 64 of 274 U. S., page 531 of 47 S.Ct., that in the Brims case, in which both he and Mr. Justice Holmes had concurred, "the purpose of the combination was not primarily to further the interests of the union carpenters. The immediate purpose was to suppress competition with the Chicago manufacturers."
From the implications of the cases which have been referred to, it seems clear that, if a labor union and its members act wholly by themselves or in conjunction with other labor groups, in the sphere and by the methods recognized in the Clayton and the Norris-LaGuardia Acts, to carry out the legitimate objects of such an organization, in improving or preserving the economic position of labor in industry and its employment relationships and conditions, they are not subject to prosecution under the Sherman Act merely because their acts may incidentally serve to affect and restrain trade or commerce;[1] but that, if they undertake to act jointly with any non-labor group, whose object is to effect an illegal restraint of trade or commerce, and, as part of a concerted plan or effort, they agree or undertake to do any act, whose purpose may reasonably be construed to be directly intended to assist such non-labor group in accomplishing its illegal purpose, even though the result may also be beneficial to the position of labor, they may become subject to the operation of the Sherman Act. Thus, labor cannot seek to accomplish its legitimate objects through the illegal means of combining or conspiring with a non-labor group to fix or maintain prices on goods moving in interstate commerce without subjecting itself to the possibility of criminal prosecution under the provisions of the Sherman Act.
*233 Perhaps a simple way of translating the two contrasting situations into conventional legal formula would be to say that, in the first, no intent to violate the Sherman Act can exist as a matter of law; and that, in the second, the law permits the purpose or intent of the labor group to become a question of fact. If the evidence is fairly and reasonably susceptible to the interpretation that an agreement or participative collaboration has existed for the purpose of directly assisting a non-labor group to accomplish an illegal restraint, such as fixing or maintaining prices, the facts of the situation, including the purpose or intent of the labor union and its members, will ordinarily, in a criminal prosecution under the Sherman Act, have to be submitted to a jury for its determination.
It is further argued on behalf of appellants that the restraint here involved, if any, tended to prevent evils both to the consuming public and to labor; that it was in any event not an unreasonable restraint; that "the amount of milk used in the Dubuque area which found its way into interstate commerce was so negligible that it is hardly worthy of notice"; and that "public interest was not involved unless the restraint in interstate trade was substantial in amount."
It is unnecessary to discuss here the details of these and parallel arguments made in the briefs. A sufficient answer to them is found in the direct expressions of the Supreme Court. Thus, in Ethyl Gasoline Corporation v. United States, 309 U.S. 436, 458, 60 S. Ct. 618, 626, 84 L. Ed. 852, it was said: "Agreements for price maintenance of articles moving in interstate commerce are, without more, unreasonable restraints within the meaning of the Sherman Act because they eliminate competition * * *." Again, in United States v. Socony-Vacuum Oil Co., Inc., 310 U.S. 150, 218, 221, 60 S. Ct. 811, 842, 84 L. Ed. 1129, the Court declared that "for over forty years this Court has consistently and without deviation adhered to the principle that price-fixing agreements are unlawful per se under the Sherman Act and that no showing of so-called competitive abuses or evils which those agreements were designed to eliminate or alleviate may be interposed as a defense. * * * Any combination which tampers with price structures is engaged in an unlawful activity. Even though the members of the price-fixing group were in no position to control the market, to the extent that they raised, lowered, or stabilized prices they would be directly interfering with the free play of market forces. The (Sherman) Act places all such schemes beyond the pale and protects that vital part of our economy against any degree of interference."
Where direct price-fixing or price-maintenance agreements or conspiracies are involved, "the amount of interstate or foreign trade involved is not material * * * since § 1 of the Act brands as illegal the character of the restraint not the amount of commerce affected. * * * They are all banned because of their actual or potential threat to the central nervous system of the economy." Id., 310 U.S. at pages 225, 226, note 59, 60 S.Ct. at page 845, 84 L. Ed. 1129. The "rule of reason", applied in Standard Oil Co. v. United States, 221 U.S. 1, 31 S. Ct. 502, 518, 55 L. Ed. 619, 34 L.R.A.,N.S., 834, Ann.Cas.1912D, 734, and United States v. American Tobacco Co., 221 U.S. 106, 31 S. Ct. 632, 55 L. Ed. 663, to general restraints upon competition in the production or distribution of articles moving in interstate commerce, has therefore no application, where direct price-fixing agreements or conspiracies are involved. Such agreements or conspiracies, as to any goods moving in interstate commerce, are cancers upon the national economy, and the court will not admeasure the depth of their relative penetration in the individual cases.
It would therefore be quite immaterial whether the fact was, as appellants contend, that in the present case no substantial amount of the whole of interstate commerce in the field involved was restrained; although, it may be observed in passing that the defendant dairy operators controlled approximately seventy per cent of the retail distribution of the milk which moved in interstate commerce into the Dubuque area and was sold to consumers in the interstate locality, and hence their price-fixing efforts certainly operated as an effective restraint as to the particular product in the immediate interstate locality.
It is contended that the trial court erred in denying appellants' motions for a bill of particulars. The indictment was sufficiently detailed to inform each of the defendants fully of the nature of the accusations against them, and the record demonstrates no prejudice from the denial of the motions. A motion for a bill of particulars in a criminal case is addressed to the sound discretion of the trial *234 court, and, in the absence of some clear demonstration of prejudice, its ruling on the motion will not be reviewed. Wong Tai v. United States, 273 U.S. 77, 82, 47 S. Ct. 300, 71 L. Ed. 545; Knauer v. United States, 8 Cir., 237 F. 8, 13, 14.
Error is alleged because the trial court excluded from the evidence a copy of a statement by the executive board of a milk drivers' union in Minneapolis, Minnesota, of the reasons why it regarded the thrift plan as detrimental to the public and to labor. It is argued that this statement tended to show appellants' good faith in opposing the thrift plan. If the statement was relevant evidence here, it was at most merely cumulative and corroborative of other direct testimony, and the trial court did not abuse its discretion in excluding it. United States v. General Motors Corporation, 7 Cir., 121 F.2d 376, 406.
The only other contention that requires consideration is the claim that the evidence is insufficient to support the convictions.
As to appellant Pfohl, who was financial secretary of the union and a milk driver for one of the defendant dairy companies, the record shows that he was present at the meeting of the milkmen's division on July 28, 1940, though he came in late; that he was the one who suggested that the Sanitary drivers should go down and tell the president of the company that "they would not work until Patsey was fired as manager and the Thrift Plan given up"; that he was present when the committee which had been sent down to call upon the dairy operators returned and made its report to the meeting; that he was also at the meeting of July 30, 1940, when the $100-fine resolution was adopted; that he apparently approved of it, except that he thought possibly it ought not to be applied to a case where a sick person wanted to change dairies in order to get a more healthful milk; that he was present at the meeting of the disputes committee, when Rittenhouse appeared to answer the charge of violating the resolution, and was one of those who suggested that, in order to be legally handled, the charges ought to be referred to the executive board of the union; and that at the subsequent meeting of the executive board he was of the view that no fine could properly be imposed until the union itself had acted upon and approved the resolution which the milkmen's division had adopted. From this evidence, the jury could properly find that Pfohl knew of the intended cooperation between the milkmen's division and the dairy operators, for the purpose of trying to maintain the 11¢ price on milk and to defeat the operation of the thrift plan; that he acquiesced and directly participated therein and that his only concern was that the proper formalities of procedure were observed to permit the union machinery to operate.
As to appellants Blankenship and the union itself, the question is somewhat closer. Blankenship, who was the recording secretary and business agent of the union, did not attend the meeting of the milkmen's division on July 28 and 29, 1940, although he later served as secretary of the disputes committee, at the time Rittenhouse appeared before it to answer charges of violating the resolution which the milkmen's division had adopted. He objected, however, to the authority of the disputes committee to impose a fine and suggested that the charges ought to be filed with the executive board of the union. He sent out notice to Rittenhouse to appear before the executive board, but, when the meeting was held, of which he acted as secretary, he suggested that he felt the executive board should take no action unless and until the union itself had approved the resolution which the milkmen's division had adopted.
As business agent of the union, Blankenship had also negotiated separate contracts between the union and the several dairy companies during 1938 and 1939, most of which had contained a provision that the dairy company involved would not make a change in the price of milk without first taking the matter up with a committee representing the "distributors unit" of the union. The evidence showed no relationship, however, between this contractual provision and the subsequent conspiracy here involved, and on the record it could hardly fairly be claimed to have had any other purpose at the time than to safeguard against the possibility of sudden wage changes on the part of any dairy company without the consideration or approval of the union. The dairy companies made price changes after the several union contracts were entered into, as to which the distributors unit was not shown to have been consulted, but as to which it could not complain since wages apparently were not affected thereby. These union contracts could not therefore be said to have evidenced an intent on *235 the part of Blankenship or the milkmen's division to become parties to a subsequent price-fixing or price-maintaining conspiracy with the dairy operators, as the Government here contends.
We are of the opinion that the evidence was insufficient to permit the jury to find that Blankenship had joined in the price-maintaining conspiracy and was attempting to further it, either individually or officially. He did not participate in the meetings of the milkmen's division, as did Pfohl. He did not make collaborative suggestions or engage in any personal furthering activity. At all times he insisted that nothing could or should be done, until the union itself had considered the matter. Without some supportive proof of personal assent, such as existed as to Pfohl, his protests could not be said to have been mere procedural concerns, as they might properly be found to be in the case of Pfohl, but could only fairly be held to have been restraining objections to the right of any one to join or participate in any action, unless and until the union had authorized it. Nor, in this situation, could there be claimed to be any official criminal responsibility upon him as business agent, unless the things done by the milkmen's division were actually, as a matter of law or fact, the actions of the union itself.
We do not believe that on the record before us a jury could be permitted to find that the actions of the milkmen's division and its members, the efforts of the president of the union and the hearings held by the disputes committee and the executive board could be imputed to the union as a matter of general agency. To bind the union in a situation such as this, actual and authorized agency was necessary; mere apparent agency would not be sufficient to take the matter to the jury, unless the circumstances were so strong as competently to support an inference of actual authority.
In United Mine Workers v. Coronado Coal Co., 259 U.S. 344, 393-396, 42 S. Ct. 570, 66 L. Ed. 975, 27 A.L.R. 762, the Supreme Court refused to allow an international union to be held liable, as a participant, for the illegal acts of a district coal mining strike, although the president on a trip to the strike vicinage had familiarized himself with the facts and had made a personal report to the international board, and the journal of the international union had thereafter published communications and editorials giving accounts of the occurrences and accusing the mine owners of being responsible for the violence which had resulted, and justifying the action of the union men. The president of the international union had further written a letter to the President of the United States, thanking him for pardoning one of the officials of the local body who had been convicted and sentenced to prison in connection with some of the strike violence.
The Court, speaking through Mr. Chief Justice Taft, declared, pages 394, 395 of 259 U.S. page 577 of 42 S.Ct., 66 L. Ed. 975, 27 A.L.R. 762: "The president [of the international union] had not authority to order or ratify a local strike. Only the Board could do this. White's [the president] report in an executive meeting of the Board of the riot of April 6 shows sympathy with its purpose and a lack of respect for law, but does not imply or prove on his part any prior initiation or indicate a desire to ratify the transaction as his work. The Board took no action on his report. * * * A corporation is responsible for the wrongs committed by its agents in the course of its business, and this principle is enforced against the contention that torts are ultra vires of the corporation. But it must be shown that it is in the business of the corporation. Surely no stricter rule can be enforced against an unincorporated organization like this. Here it is not a question of contract or of holding out an appearance of authority on which some third person acts. It is a mere question of actual agency * * *."
After a retrial in the lower court, the case again came before the Supreme Court in Coronado Coal Co. v. United Mine Workers, 268 U.S. 295, 45 S. Ct. 551, 69 L. Ed. 963, and the question of the sufficiency of the evidence to show participation by the international union in the illegal events of the strike was again considered and discussed, at pages 299-305 of 268 U.S., 45 S. Ct. 551. Proof of additional statements and promises made by the president of the international union had been introduced in evidence, indicating that he had directly encouraged and abetted the destruction of the mine owners' property. The Court, again speaking through Mr. Chief Justice Taft, held that while this evidence might have been sufficient to subject the president to a personal responsibility, it was not sufficient to impose a *236 liability upon the union. The opinion says, at page 304 of 268 U.S., page 554 of 45 S.Ct.: "In our previous opinion we held that a trades-union, organized as effectively as this United Mine Workers' organization was, might be held liable, and all its funds raised for the purpose of strikes might be levied upon to pay damages suffered through illegal methods in carrying them on; but certainly it must be clearly shown in order to impose such a liability on an association of 450,000 men that what was done was done by their agents in accordance with their fundamental agreement of association."
The proof of actual agency required against a union in a criminal case under the Sherman Act necessarily must be as strong or stronger than that required in a civil action under the statute for damages.
In the present case, the situation of course is somewhat different from that referred to in the Coronado Coal Co. cases, supra, in that only a local union and its divisions are involved, but, on the record before us, the difference fundamentally is primarily one of degree. The evidence shows, as we have previously indicated, that the milkmen's division was a separate unit of the general union and held independent meetings. The Government did not attempt to develop the scope of the actual relationships between the division and the union. The only thing that the evidence specifically shows in this connection is that the minutes and actions of the milkmen's division were required to be approved by the union as a whole, before they would be binding on that body. With only this proof in the record, we would not be justified in assuming, nor a jury in finding, that the milkmen's division was so integrated in the union structure that its actions would be binding on the union itself as a matter of identity or actual agency, regardless of whether they were in fact approved or sanctioned by the union body.
Nor, in view of the requirement for approval of the actions of the milkmen's division by the union itself, could the acts of the president of the union, while serving in the capacity of chairman of the milkmen's division, be given greater effect, without more specific proof of the existing relationships and actual authority, than an attempt as such chairman to further the plans of the division. On the record before us, the president must be treated as having no authority to commit the union, through the milkmen's division, to any such conspiracy as is here involved, until the union had approved or in some imputable manner sanctioned what the milkmen's division had done. The same necessarily would be true of the disputes committee and executive board. In order to impose a responsibility upon the union in the situation, as the Court said in the second Coronado Coal Co. case, supra, "certainly it must be clearly shown * * * that what was done was done by their agents in accordance with their fundamental agreement of association".
We do not mean to imply that the union had to approve the action of the milkmen's division by formal motion or resolution. Such approval might perhaps legally be found to exist from actual knowledge and general sanction on the part of the union body of the efforts of the milkmen's division to cast the strength of the union into the situation. But here again the record before us is lacking in adequate proof. The knowledge and sanction of the president and of Pfohl, acting as part of the milkmen's division, and the knowledge of Blankenship and of the executive board, with no action on the part of the latter indicative of actual approval and an attempt to put the union machinery into operation in the cause, could not be said to have committed the union to the conspiracy, in view of the specific limitation which the record uncontradictedly shows existed upon the authority of the milkmen's division to bind the union. What might have been the situation, if the officers of the union had been performing the mere normal functions of their offices for the union, or if the evidence had blurred the line of demarcation between the milkmen's division and the union body itself, we need not consider. Those were facts which, if they existed, the Government should have been in a position to prove.
The fact that the union expunged the resolution of the milkmen's division from the records certainly cannot be accepted in a criminal prosecution as establishing previous knowledge and sanction on the part of the union body, without some proof that this was not the first time that the resolution or the actions of the milkmen's division had been brought to the attention of the union. If the union body knew of the action of the milkmen's division prior to *237 the time it expunged the resolution from the records, this fact surely was susceptible of proof in some manner on the part of the Government. As the record stands, we must assume that this was the first time that the matter actually was brought to the attention of the union itself, the great majority of whose members consisted of men engaged in other industries.
Doubtless the evidence was sufficient as against the milkmen's division to have required the submission of its guilt to the jury, if that division had been and could be prosecuted as a body. Whether the milkmen's division was sufficiently in the nature of an association to be capable of being prosecuted as such, or whether its members could only have been prosecuted individually, does not appear in the record, nor is it material here. The fact that appellant Pfohl is the only participant in the activities of the milkmen's division upon whom the burden of conviction will fall in the present proceeding is, of course, not a valid legal argument for a reversal in his favor.
The judgment will be affirmed as to appellant Pfohl and will be reversed as to appellant Blankenship and the appellant union.
NOTES
[1] In his dissenting opinion in Duplex Printing Press Co. v. Deering, 254 U.S. 443, 486, 41 S. Ct. 172, 183, 65 L. Ed. 349, 16 A.L.R. 196, Mr. Justice Brandeis said that the Clayton Act in effect "declared that the relations between employers of labor and workingmen were competitive relations, that organized competition was not harmful and that it justified injuries necessarily inflicted in its course." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545446/ | 342 B.R. 358 (2006)
In re Meredith Lee UNDERWOOD, Debtors.
No. 06-30015-LMK.
United States Bankruptcy Court, N.D. Florida, Pensacola Division.
May 24, 2006.
*359 Karin A. Garvin, Attorney at Law, Pensacola, FL, for Debtors.
Sherry Chancellor, Pensacola, FL, trustee.
*360 ORDER OVERRULING TRUSTEE'S OBJECTION TO DEBTOR'S EXEMPTIONS
LEWIS M. KILLIAN, JR., Bankruptcy Judge.
This case came on for hearing on April 27, 2006, upon the Chapter 7 Trustee's Objection to Exemptions (the "Objection") (Doc. 16). The Debtor filed her Chapter 7 petition on January 13, 2006, along with her schedules and statement of financial affairs and other required documents. In her original Schedule C filed with the petition, the Debtor claimed exemptions under Colorado state law. On February 13, 2006, she filed an Amended Schedule C in which she claimed the federal exemptions under 11 U.S.C. § 522(d). On March 17, 2006, the Chapter 7 Trustee (the "Trustee") filed the Objection, arguing that the Debtor is not entitled to claim the federal exemptions and should be allowed to claim only the Colorado exemptions.
According to the Debtor's Statement of Financial Affairs, filed along with the petition, the Debtor has lived in Pensacola, Florida, since February of 2004. Prior to that, from January 2000 through January 2004, the Debtor resided in Denver, Colorado. A person may file for bankruptcy protection under Title 11 in the district in which the debtor was domiciled or resided for the 180 days immediately preceding the filing of the petition, or, if the debtor resided in more than one district in those 180 days, in the district in which the debtor lived for a longer portion of such 180-day period than in any other place. 28 U.S.C. § 1408. Accordingly, since the Debtor lived in Pensacola, Florida, for almost two full years preceding the petition date, venue properly lies in this District. However, as explained below, the Debtor is ineligible to claim exemptions under Florida state law.
An individual is entitled to exempt from property of the estate either certain property listed in Section 522(d) of the Bankruptcy Code (known as the "federal exemptions"), or such property as is allowed to be exempted by debtors under applicable state law, at the debtor's choice. 11 U.S.C. § 522(b). However, the Bankruptcy Code allows individual states to "opt-out," or to prohibit those eligible to claim that state's exemptions from choosing the federal exemptions. 11 U.S.C. § 522(b)(2). The Debtor is ineligible to claim the exemptions allowed under Florida law because the Bankruptcy Code, as amended by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 ("BAPCPA"), provides that a debtor may claim property exempt under state law "that is applicable on the date of the filing of the petition at the place in which the debtor's domicile has been located for the 730 days immediately preceding the filing of the petition, or if the debtor's domicile has not been located at a single State for such 730-day period, the place in which the debtor's domicile was located for 180 days immediately preceding the 730-day period or for a longer portion of such 180-day period than any other place." 11 U.S.C. § 522(b)(3).[1] In other words, a debtor may only claim the state law exemptions available in her state of residence if she has lived in that state for two or more years as of the petition date. Since the Debtor had not yet lived in Florida for 730 days on her petition date, she is ineligible to claim Florida exemptions. The Debtor lived in Colorado for the entirety of the 180 days preceding the 730 days prepetition. As such, the Trustee argues that the Debtor is restricted to *361 claiming Colorado exemptions under Colorado law because Colorado is an "opt-out" state. On the other hand, the Debtor asserts that she is entitled to claim the federal exemptions found in Section 522(d) of the Bankruptcy Code because she cannot claim Colorado state exemptions, which she contends are available only to residents of Colorado.
Colorado's "opt-out" statute provides that the federal exemptions are "denied to residents of this state." Colo. Stat. § 13-54-107. It further provides that, "[e]xemptions authorized to be claimed by residents of this state [Colorado] shall be limited to those exemptions expressly provided by the statutes of this state." Id. The trustee argues that this statute limits Colorado residents to Colorado exemptions but does not restrict non-residents from choosing to claim Colorado exemptions. However, the Court disagrees and finds that Colorado exemptions are available only to Colorado residents. Nothing in the Colorado exemption law expressly provides for its application to non-residents; rather, the opt-out statute refers to exemptions to be claimed "by residents of this state." Colo. Stat. § 13-54-107 (emphasis added). The Colorado Supreme Court has opined that "[p]rimarily, the exemption laws of the state are for the benefit of residents. . . ." Sandberg v. Borstadt, 48 Colo. 96, 109 P. 419, 421 (1910) (emphasis added). Further, a Colorado bankruptcy court acknowledged that the enactment of liberally-construed Colorado exemption laws was mandated by the Colorado Constitution in order "to benefit the residents of Colorado." In re Kramer, 339 B.R. 761, 763 (Bankr.D.Colo.2006). Since the Colorado exemption laws were constitutionally mandated and enacted for the benefit of Colorado residents only, residents of other states are not allowed to avail themselves of the benefit granted by the Colorado legislature to its residents for their protection. Therefore, the Debtor in this case is ineligible to claim any state's exemptions.
This Court dealt with an analogous situation pre-BAPCPA in In re Schulz, 101 B.R. 301 (Bankr.N.D.Fla.1989). The debtor in Schulz had resided in Florida until approximately one month before he filed his petition, at which time he moved to Wisconsin. Id. Under the venue requirements of 28 U.S.C. § 1408, the debtor was required to file his petition in this District. Id. The debtor in Schulz was ineligible to claim Wisconsin exemptions for the same reason the Debtor in this case cannot claim Florida exemptions because he had not yet resided for the requisite period of time in that state. Likewise, he was ineligible to claim Florida exemptions for the same reason this Debtor cannot claim Colorado exemptions because he was no longer a resident of the state. Like the Colorado statute, the Florida statute provides that "`residents of this state [Florida] shall not be entitled to the federal exemptions. . . .'" Schulz, 101 B.R. at 302 (emphasis in original), quoting Fla. Stat. § 222.20. Thus, this Court held that the debtor, who was ineligible for any state law exemptions, was eligible to claim the federal exemptions, because no applicable state law prohibited him from claiming such, and because denying the debtor the benefit of any exemptions would be "contrary to the `fresh start' policy of the Bankruptcy Code." Id. at 302. Similarly, even if the Debtor could claim Colorado exemptions, she would still be eligible to choose to claim the federal exemptions instead. A debtor may claim the federal exemptions unless "the State law that is applicable to the debtor . . . specifically does not so authorize." 11 U.S.C. § 522(b)(2). The Colorado "opt-out" statute only prohibits Colorado residents from *362 choosing to claim the federal exemptions. Colo. Stat. § 13-54-107. The Debtor is a resident of Florida, not Colorado. Therefore, even if the Debtor was eligible to claim Colorado exemptions, she could choose instead to claim federal exemptions because no state law prohibition against claiming federal exemptions applies to her.
The result reached by this Court in Schulz is now compelled by an express provision of the Bankruptcy Code enacted under BAPCPA. The undesignated sentence at the bottom of 11 U.S.C. § 522(b)(3) provides that "[i]f the effect of he domiciliary requirement under subparagraph (A) is to render the debtor ineligible for any exemption, the debtor may elect to exempt property that is specified under subsection (d)." This sentence follows subparagraph (C), but it is not indented as the subparagraphs are. This indicates that it modifies the entirety of paragraph (3). Further, this is the only logical way to interpret the sentence, as subparagraph (C) deals with the exemption of retirement funds, and it does not make sense for the undesignated sentence to only apply to retirement funds. Since paragraph (3) relates to exemptions under state law, it makes the most sense for the undesignated sentence to apply to paragraph (3) as a whole. Thus, it means exactly what it says: if the 730-day domiciliary requirement under subparagraph (A) renders a debtor ineligible for any state exemptions, the debtor may claim federal exemptions. Since the Debtor may not claim Colorado exemptions because she is not a Colorado resident, and since the 730-day domiciliary requirement in the Bankruptcy Code renders her ineligible to claim exemptions under any state's laws, the Debtor may claim federal exemptions. Accordingly, it is hereby
ORDERED AND ADJUDGED that the Trustee's Objection to Exemptions is overruled and the exemptions claimed by the Debtor are allowed.
NOTES
[1] Pre-BAPCPA, a Debtor could claim the exemptions of the state in which she had lived for just 180 days prepetition, tracking the same language as the venue statute. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545447/ | 128 F.2d 693 (1942)
FROST LUMBER INDUSTRIES, Inc.
v.
COMMISSIONER OF INTERNAL REVENUE.
No. 10160.
Circuit Court of Appeals, Fifth Circuit.
June 11, 1942.
*694 Elmo P. Lee, of Shreveport, La., for petitioner.
Newton K. Fox, J. Louis Monarch, Sp. Assts. to Atty. Gen., Samuel O. Clark, Jr., Asst. Atty. Gen., and J. P. Wenchel, Chief Counsel, Bur. Int. Rev., and Rollin H. Transue, Sp. Atty., Bur. Int. Rev., both of Washington, D. C., for respondent.
Before FOSTER, SIBLEY, and HUTCHESON, Circuit Judges.
HUTCHESON, Circuit Judge.
Another of those touch and go tax cases where the decision seems to turn not upon the facts as mere facts but upon the emphasis placed upon one fact as opposed to another, the question presented here is whether the profit from a sale of land accrued in 1935, as claimed by the taxpayer, when a binding contract for sale was made and most of the things necessary to be done were done or in 1936 when the title was formally accepted and the purchase money paid.
The rule that an item accrues for purposes of taxation when all events have occurred necessary to fix the liabilities of the parties and to determine the amount of such liabilities, seems simple enough, but when in endeavoring to apply it we read the conflicting decisions its attempted application has given rise to, we are reminded of Captain Cuttle's famous dictum, "the bearings of that obserwation lies in the application of it." We are told that the test whether an item of income or or of loss is sustained in a certain year is a practical one, but when we see the different results different supposedly practical men get from applying the same test, we plainly see that what to one practical mind seems heresy, to another equally practical, seems doctrine. In this situation of every mind for itself the solution, we think, is the preferred one which "in cases of doubt gives the benefit to the taxpayer", another rule modernly more often honored in the breach than in the observance. In that view where the taxpayer's books are kept on an accrual basis, where the amount is reasonably certain in fact and determinable in amount, it may be treated as a gain or a loss even though the exact amount may not have been precisely ascertained. United States v. Anderson, 269 U.S. 422, 46 S. Ct. 131, 70 L. Ed. 347; Lucas v. American Code Company, 280 U.S. 445, 50 S. Ct. 202, 74 L. Ed. 538, 67 A.L.R. 1010. Though the computation may be undetermined, if the basis for the computation is unchangeable and though the exact amount may be unknown, if it is not unknowable, the item in such cases is to be treated, for tax purposes, as accrued income. Uncasville Manufacturing Company v. Commissioner, 2 Cir., 55 F.2d 893. In Spring City Company v. Commissioner, 292 U.S. 182, 54 S. Ct. 644, 645, 78 L. Ed. 1200, the court said: "Keeping accounts and making returns on the accrual basis, as distinguished from the cash basis, import that it is the right to receive and not the actual receipt that determines the inclusion of the amount in gross income. When the right to receive an amount becomes fixed, the right accrues." On the other side are cases like Lucas v. North Texas Company, 281 U.S. 11, 50 S. Ct. 184, 74 L. Ed. 668, where an option was accepted late *695 in 1916 by a notice from the purchaser which stated that it was ready to close the transaction and pay the purchase price as soon as the transfer papers were prepared by the seller. The papers were not prepared until 1917 and the Court held, citing United States v. Anderson, supra; American National Company v. United States, 274 U.S. 99, 47 S. Ct. 520, 71 L. Ed. 946, that the profit did not then accrue, since the title and right of possession remained in the vendor until the transaction was actually closed in 1917.
The petitioner is a corporation, keeping its books and making its returns on the accrual method of accounting. On August 2, 1935, the petitioner, then being the owner of 53,947.13 acres, more or less, of land known as the Montrose Tract, in Louisiana, gave the Secretary of Agriculture a twelve month option under the usual terms to purchase it at $6.25 per acre. The option, among other things, provided that if it was availed of the acreage should be determined by survey; that the government might condemn any of the lands for which satisfactory title could not be shown; and that the government's representatives should be permitted to enter the lands, pending vesting of title in the United States, for proper purposes for use and administration for the purposes of the national forests.
On August 23, 1935, the National Forest Reservation Commission notified the petitioner that the purchase had been approved at $6.25 per acre, that the Department of Agriculture "elects to purchase" in accordance with the option, and that, after establishment of boundaries, ascertainment of acreage, and examination of title, payment would be made upon approval of title by the Attorney General, in accordance with statutory requirements. Weeks Law, Act of March 1, 1911, 36 Stat. 961, and Acts amendatory thereof, 16 U.S.C.A. §§ 480, 500, 513-519, 521, 552, 563.
Though the contract for purchase was then completely closed, examination of the title was not begun until late in November, 1935, but so regular was it that though only one-tenth of it had been formally completed in that year and the whole of it was not formally completed until July 28, 1936, the title attorney was able to advise taxpayer before the end of 1935; that the chain of title appeared to be in good condition; that on the basis of past experience he knew that practically all of the titles could be made good; and that such discrepancies as there were in the statement of acreage were very natural and had happened in every title of consequence he had had anything to do with.
Concerned over the probability that if the formal examination was delayed into 1936, the lands would be on the tax rolls for 1935 and 1936 and it would have to pay state and parish taxes for those years, taxpayer conferred with the title attorney relative to executing to the United States and recording in 1935 a deed to the lands. The attorney advised the taxpayer that although the examination was not yet complete, little difficulty with the title was expected and that while the attorney could not advise it to execute and record the deed, as that was a matter for its own counsel to advise on, taxpayer could of course do so of its own motion if so advised. Thereafter, on December 13, 1935, taxpayer executed and placed of record a deed to the United States reciting receipt of consideration of $337,148.62 for 53,943.78 acres, more or less, and warranting title limited to the return of the purchase price fixed at $6.25 per acre for that land to which title might fail.
On the following day taxpayer entered this sale on its books, and in its return for 1935, it reported a profit on it. On the strength of this deed of December 13, 1935, the title attorney before making his report of July 28, 1936, obtained a certificate from the Louisiana Tax Commission, instructing the local tax collectors and sheriffs to remove the lands from the 1935 and 1936 tax rolls. And though the title attorney in his report of July 28, 1936, advised that the deed had been recorded by taxpayer on its own initiative and he thought a new deed for the correct acreage ought to be recorded, and drew up such a deed and had it executed by the seller, upon advice from the attorney general's office he did not record it, and the deed of December 13, 1935, has stood as the basis for transfer of title.
On July 28, 1936, the title attorney reported to the Department of Agriculture that title to 53,898.70 acres had been approved. Petitioner was paid $336,866.87 for this acreage in 1936, and in 1938 received a further payment for 5 additional acres included in the deed making a total acreage approved and paid for of 53,903.70. Pursuant to condemnation proceedings instituted in 1938, the United States *696 acquired 9.65 acres included in the option but not approved by the Attorney General, and assessed costs against petitioner in that suit under the warranty contained in the 1935 deed.
The Commissioner determined a deficiency in the petitioner's return for 1936, ruling that the $125,656.41 profit from the transaction constituted income in 1936. On review, the Board of Tax Appeals sustained the Commissioner, on the ground that all the events necessary to fix the obligation and its amount had not occurred by the close of 1935. Petitioner here argues that the gain was so reasonably certain in fact and ascertainable in amount as that it was required to be treated upon an accrual method of accounting as income in 1935 and not in 1936. Respondent contends that in 1935 petitioner had no unconditional right to receive the proceeds; that neither the acreage nor the price had then been determined; and that until the title had been approved in 1936 by the Attorney General, petitioner had no reasonable expectancy of payment.
The petitioner on its part points out that the option agreement fully described the acreage involved, and contained an appraisement of the area, borne out by later events substantially identical with the amount of land accepted. Description of the acreage was in accord with horizontal measurements used in government surveys, and the description appears to have been based on a prior government survey. On the basis of $6.25 per acre, the method of computation was unalterable, and the fact that some slight difference in acreage might call for a greater or lesser total price would not render the computation in any way more uncertain. Where a purchase price is conditional and subject to subsequent abatement, the sale may nevertheless for tax purposes be considered as concluded on the date of its agreement. Helvering v. Nibley-Mimnaugh Lumber Co., 63 App.D.C. 181, 70 F.2d 843. Further, where the price is left to later computation, and dispute arises as to the method of computation, the situation is unchanged even though the settlement is effected by compromise. Schoellkopf Aniline & Chemical Works, Inc., v. United States, Ct.Cl., 3 F. Supp. 417.
When the petitioner was notified that the Department of Agriculture elected to purchase, and the deed was recorded, all that was necessary to fix the obligation of the parties had been done. Tender of payment was not a condition precedent to acceptance of the option; notice of its acceptance converted it into a bilateral contract binding on all of the parties. Wachovia Bank & Trust Company v. United States, 4 Cir., 98 F.2d 609. After the deed was filed, the agreement can no longer be considered as an executory contract with conditions precedent required to be performed before the obligation became fixed. Cf. Lucas v. North Texas Lumber Company, 281 U.S. 11, 50 S. Ct. 184, 74 L. Ed. 668; Commissioner v. R. J. Darnell, Inc., 6 Cir., 60 F.2d 82. Approval of the title by the Attorney General was an incident which left only the final accounting, and not the obligation, for future determination.
From conversations with the title attorney, who stated that on the basis of his past experience and from his preliminary examination of the chain of title, he was practically certain that the title was or could be made good, the petitioner had a reasonable expectancy of payment. On the basis of the deed recorded in 1935, the title attorney himself secured the removal of the property, from the state and local tax rolls. Moreover, the government treated the deed as an effectual conveyance; it entered upon the land and sold timber therefrom; it held petitioner liable on its warranty in the deed in assessing costs of subsequent condemnation proceedings against the petitioner; it required no subsequent amendment or correction of the deed. Although the price had not then been paid, the conduct of seller and purchaser after its recording establishes that for tax purposes it was a closed transaction. Cf. Commissioner v. Union Pacific Railroad Company, 2 Cir., 86 F.2d 637.
The order of the Board is reversed and the cause is remanded with instructions to redetermine the deficiency in accordance herewith.
Reversed and remanded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583234/ | 728 N.W.2d 852 (2007)
STATE
v.
COUSINS.
No. 06-0483.
Court of Appeals of Iowa.
January 18, 2007.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580854/ | 42 So. 3d 405 (2010)
STATE of Louisiana
v.
Eduardo CRUZ.
No. 2010-KK-1923.
Supreme Court of Louisiana.
August 19, 2010.
*406 Stay denied; Writ denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580847/ | 42 So. 3d 1044 (2010)
Johnny BAKER; Essie Calaway; James Odis Millner; Zona Winston On Behalf of Mount Calm Baptist Church of Minden, Louisiana, Plaintiffs-Appellants
v.
T. Alexander KNAPP, Defendant-Appellee.
No. 45,404-CA.
Court of Appeal of Louisiana, Second Circuit.
June 23, 2010.
Rehearing Denied August 5, 2010.
*1045 Lilly Law Corporation, by Roy M. Lilly, Jr., Minden, for Appellants.
Ayres, Warren, Shelton & Williams, LLC by Lee H. Ayres, Shreeveport, Jason W. Poe, Kitchens, Benton, Kitchens & Black by Paul E. Kitchens, Minden, for Appellee.
Before WILLIAMS, GASKINS and CARAWAY, JJ.
GASKINS, J.
The plaintiffs appeal a trial court ruling granting summary judgment in favor of the defendant church and its pastor, who was accused of financial improprieties by a group of church members. We affirm the trial court judgment.
FACTS
T. Alexander Knapp is the pastor of the Mount Calm Baptist Church of Minden, Louisiana, a nonprofit religious corporation. In January 2008, four persons claiming to be church membersJohnny Baker, Essie Calaway, James Odis Millner, and Zona Winstonfiled suit against Knapp. They alleged that Knapp, and others designated by him as officers or deacons of the church, had failed to comply with Louisiana law regulating nonprofit corporations and that these actions had deprived the plaintiffs of the "benefits which membership in and to a place of worship should afford." The allegations against Knapp included failing to maintain records of membership and finances, failing to allow examination of such records, failing to distribute financial reports to the congregation, committing ultra vires acts purporting to adopt bylaws and to disenfranchise members without membership concurrences, and committing "other acts which cannot be ascertained until discovery is completed." The plaintiffs asserted in their petition that they were acting on behalf of themselves and other members to determine the existence and accuracy of all corporate records required to be maintained by the church, as well as the financial condition and legal status of the church. They propounded interrogatories to Knapp as to the church's financial records.
On May 6, 2008, a first supplemental and amending petition was filed in which the church was added as a party defendant and the plaintiffs requested the appointment of a receiver pursuant to La. R.S. 12:258(A)(1) and (2) to temporarily oversee financial and membership affairs of the *1046 church. The plaintiffs also asserted that Knapp was not a member of the church; that no elections of church officers had been conducted within "recent memory"; and that Knapp has assumed complete control of the church's assets. On July 25, 2008, a second supplemental and amending petition was filed, adding 23 new plaintiffs and alleging additional failures by Knapp.
In the meantime, Knapp filed dilatory, declinatory and peremptory exceptions. They were originally set for hearing on May 13, 2008, but were passed to July 29, 2008, by agreement. On May 13, 2008, the trial court ordered that the church records be made available to the plaintiffs and their attorney on May 28, 2008. That meeting was held in the fellowship hall of the church; it was attended by Knapp, the original plaintiffs, counsel for both sides, a certified public accountant retained by the plaintiffs, and some church deacons. The church's financial records were displayed on a table.
Following a hearing on July 29, 2008, at which Knapp testified, the trial court ruled on Knapp's exceptions. The dilatory exception of prematurity was referred to the merits. The peremptory exception of no right of action as to Johnny Baker was granted; all claims by Baker were dismissed with prejudice.[1] The dilatory exception of lack of procedural capacity as to all plaintiffs purporting to file suit on behalf of the church was granted; however, the claims of Calaway, Millner and Winston were allowed to proceed in their individual capacities as members. The peremptory exception of no cause of action and the declinatory exception of lack of subject matter jurisdiction were denied. Judgment in conformity with the court's ruling was signed on October 14, 2008.
In March 2009, Knapp and the church answered the plaintiffs' interrogatories, citing La. C.C.P. art. 1460[2] and the May 2008 meeting at which the plaintiffs were given an opportunity to inspect and copy the requested information. The defendants also filed an answer and a motion for summary judgment.
In support of their motion for summary judgment, the defendants submitted an affidavit by Knapp, in which he attested to the circumstances surrounding the opportunities given to the plaintiffs to examine the church records. He stated that all financial records pertaining to the church are kept at the church's business office and that all of these records were presented at the meeting on May 28, 2008. He listed 21 items which were submitted for examination by the plaintiffs, their counsel, and their certified public accountant. These items included all of the church's collection envelopes, bulletins, bills, invoices, and bank statements for the past three years, *1047 as well as annual budgets for the years 2005 to 2008. Knapp stated in his affidavit that he and two other church officials were present; that the plaintiffs voluntarily stopped the inspection after an hour and 20 minutes; and that the plaintiffs only copied 12 pages from the church's minute book. He also stated that since that inspection, the plaintiffs have made no other effort to examine the records. Additionally, Knapp attested that the church's annual business conference was held in November 2008 in the church's sanctuary after notice was given and that at least two of the plaintiffs were present.
The defendants also submitted an affidavit by Kimberly Rice, the designated clerk for the church, in which she stated that she was familiar with the church's membership rolls and that the majority of members had signed letters supporting Knapp and the deacon ministry of the church; the letters were attached to her affidavit. Also attached to her affidavit was a roll of current church membership.[3] Additionally submitted in support of the motion for summary judgment were certified minutes of a church meeting on January 13, 2008, at which a resolution was unanimously passed stating that the church had not authorized anyone to represent the church in lawsuits against Knapp or the church, affirming and ratifying all actions taken by Knapp in his 16 years as pastor, and declaring that Knapp had fully complied with all adopted bylaws of the church; and a transcript of the trial court's ruling on the exceptions in which the judge stated that Knapp would be entitled to judgment if his actions were approved by a majority of the board of directors or deacons and by a majority of the church membership.
The defendants asserted that on numerous occasionsboth before and after the filing of suitthey have given the plaintiffs opportunities to examine the financial records which the plaintiffs have declined. When the trial judge ordered such an examination, the defendants stated that the plaintiffs appeared and merely "thumbed through" a few of the records for only an hour and 20 minutes.
On May 19, 2009, the plaintiffs fax-filed an opposition to the motion for summary judgment, as well as motions to compel answers and to appoint a receiver. They asserted that Knapp should be compelled to answer interrogatories and hand over his personal financial records; they also reiterated their contention that a receiver should be appointed. They submitted an affidavit by the certified public accountant who represented them at the examination of the church records; he stated that he was told that no accounting records were maintained. He stated that constructing accounting records from the source documents of the church was a project that would require a substantial amount of a competent accountant's time. The four original plaintiffs also submitted a joint affidavit stating they were present at the May 28, 2008 meeting when the financial records were provided. They made various statements to the effect that Knapp should be made to reveal his and the church's finances.
*1048 The defendants filed a memorandum in opposition to the plaintiffs' motions to compel answers and to appoint a receiver based upon procedural noncompliance with several court rules. They requested that the motions either be stricken from the record or that they be granted a continuance to address them. They also filed into the record a copy of their answers to the plaintiffs' interrogatories.
The motion for summary judgment was argued on May 26, 2009, and taken under advisement.[4] The next day the trial court issued written reasons, granting the motion. The trial court stated that it appeared that as long as the pastor, the board of deacons and the majority of members are in agreement, they have the authority to conduct the church's business as they see fit. The court then set forth several facts which were not in serious dispute: the church's records have been made available to the plaintiffs; the board of deacons and membership have affirmed all of the pastor's actions; the majority of membership fully supports the pastor and deacons; and no specific factual allegations of "gross mismanagement" or "gross and persistent ultra vires acts" have been made. Without evidence of "gross mismanagement" or "persistent ultra vires acts," the trial court found it was inappropriate for it to become involved in the church's business when the majority of members, the deacons and the pastor are in agreement as to how business is conducted. Judgment dismissing all claims and demands by the plaintiffs was signed June 16, 2009.
The plaintiffs filed a motion for new trial. They claimed that the trial court ignored its pending motion to compel and asserted that discovery was not adequate. On October 7, 2009, the trial court denied the motion for new trial; judgment was signed November 3, 2009.
The plaintiffs appeal, arguing that the trial court dismissed their suit before they were allowed adequate discovery.
LAW
The appellate court's review of a grant or denial of a summary judgment is de novo. Independent Fire Insurance Company v. Sunbeam Corporation, 1999-2181, 1999-2257 (La.2/29/00), 755 So. 2d 226. A motion for summary judgment is a procedural device used when there is no genuine issue of material fact. King v. Illinois National Insurance Company, XXXX-XXXX (La.4/3/09), 9 So. 3d 780. The summary judgment procedure is designed to secure the just, speedy and inexpensive determination of every action allowed by law. La. C.C.P. art. 966(A)(2). A motion for summary judgment shall be granted if the pleadings, depositions, answers to interrogatories and admissions on file, together with any affidavits, show that there is no genuine issue of material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B).
On the motion for summary judgment, the burden of proof is on the mover. La. C.C.P. art. 966. However, if the mover will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, then the mover may merely point out to the court the absence of factual support for one or more elements essential to plaintiff's claim. The burden then shifts to the plaintiff to present evidence demonstrating that genuine issues of material facts remain. La. C.C.P. art. 966(C)(2); Fletcher v. Wendelta, *1049 Inc., 43,866 (La.App.2d Cir.1/14/09), 999 So. 2d 1223, writ denied, XXXX-XXXX (La.4/13/09), 5 So. 3d 164. If the plaintiff fails to meet this burden, there is no genuine issue of material fact and the mover is entitled to summary judgment. La. C.C.P. art. 966(C)(2); Fletcher, supra.
Under La. C.C.P. art. 966, a motion for summary judgment is appropriate only after "adequate discovery." It is not an abuse of the trial court's wide discretion in discovery matters to entertain a motion for summary judgment before discovery has been completed. It is within the trial court's discretion to render a summary judgment or require further discovery. Estate of Loveless ex rel. Loveless v. Gay, 41,575 (La.App.2d Cir.12/13/06), 945 So. 2d 233; Thomas v. Willis-Knighton Medical Center, 43,176 (La.App.2d Cir.4/30/08), 981 So. 2d 807, writ denied, XXXX-XXXX (La.9/19/08), 992 So. 2d 932.
The defendant's motion for summary judgment may be made at any time. La. C.C.P. art. 966(A)(1). The motion may be considered even before the parties have completed discovery. Barron v. Webb, 29,707 (La.App.2d Cir.8/20/97), 698 So. 2d 727, writ denied, 97-2357 (La.11/26/97), 703 So. 2d 651; Humphries v. Cooper Truck Center, 40,586 (La.App.2d Cir.3/8/06), 923 So. 2d 940; Peterson v. City of Tallulah, 43,197 (La.App.2d Cir.4/23/08), 981 So. 2d 192; Brooks v. Minnieweather, 44,624 (La. App.2d Cir.8/19/09), 16 So. 3d 1244. It is within the trial court's discretion to render a summary judgment, if appropriate, or to allow further discovery. While parties should be given a fair opportunity to present their claim, there is no absolute right to delay action on a motion for summary judgment until discovery is completed. Humphries, supra. The only requirement is that the parties be given a fair opportunity to present their claims and, unless a plaintiff shows probable injustice, a suit should not be delayed pending discovery when it appears at an early stage that there is no genuine issue of material fact. Peterson, supra.
La. R.S. 12:223, which provides for the keeping of corporate records and reports, states:
A. Every corporation shall keep at its registered office (1) records of the meetings of its members and directors, and of committees of the board, share and membership records giving the names and addresses of the members in alphabetical order by classes and series and the number of shares held by each, and records of its assets, liabilities, receipts, disbursements, gains, losses, capital and surplus; and (2) separate records of all trust funds held by it. Whenever membership is terminated, this fact shall be recorded in the share or membership record together with the date on which the membership ceased, and transfers of shares shall similarly be recorded.
B. The records listed in subsection A of this section may be in written form or in any other form capable of being converted into written form within a reasonable time.
C. Every shareholder and voting member may examine in person, or by agent or attorney, at any reasonable time, the records of the corporation listed in subsection A of this section.
D. If the articles or the trust instrument so provide, every corporation shall, within ninety days after the close of each fiscal year, mail an annual report, signed by the treasurer, to its members concerning any trust funds held by it, and the use made of such funds and the income thereof during such fiscal year.
La. R.S. 12:258, which pertains to the appointment of a receiver for a nonprofit corporation, provides in pertinent part:
*1050 A. The court may, after trial, appoint a receiver to take charge of the corporation's property when it is made to appear, in a proceeding instituted against the corporation:
(1) By any member or creditor, that the directors or officers of the corporation are jeopardizing the rights of its members or creditors by grossly mismanaging the corporation, or by committing gross and persistent ultra vires acts, or by wasting, misusing or misapplying the assets of the corporation; or
(2) By any member or creditor, that the corporation's property has been abandoned, or that, by failure of the members to elect directors, or the failure of the directors or officers to serve, there is no one authorized to take charge of or conduct its affairs;....
DISCUSSION
The plaintiffs assert that the trial court dismissed their action without allowing them sufficient discovery. They contend that they have a right to determine the amount the pastor received from the church and whether he is indebted to the church; to this end, they complain about his failure to specifically respond to their interrogatories. They also argue that Knapp merely "displayed" a group of invoices, bills and check stubs.
For their part, the defendants respond that the only discovery executed by the plaintiffs in over a year was to propound one set of 11 interrogatories and to personally inspect all of the church's records for an hour and 20 minutes. No depositions were taken, nor were any subpoenas issued. The defendants point out that no effort was made to cross-examine Knapp about his personal finances when he testified at the hearing on the exceptions. They note that the plaintiffs failed to follow proper procedures in pursuing a motion to compel. At the hearing on the motion for summary judgment, the plaintiffs did not specifically raise the motion to compel or request additional time for discovery. In summary, the defendants denied wrongdoing, gave access to the financial records of the church, and provided documentation showing support for Knapp and ratification of his actions by the deacons and members of the church. Therefore, they argue the burden of proof shifted to the plaintiffs, who were then obliged to present evidence showing gross mismanagement, gross and persistent ultra vires acts, and misuse of the church's assets, as required by La. R.S. 12:258(A)(1) in order to defeat summary judgment. As the plaintiffs failed to do so, the defendants contend that summary judgment dismissing the suit was warranted. We agree.
In Bourgeois v. Landrum, 396 So. 2d 1275 (La.1981), the Louisiana Supreme Court noted that the First Amendment of the United States Constitution severely circumscribes the role that civil courts may play in resolving church property disputes. The First Amendment commands civil courts to decide church property disputes without resolving underlying controversies over religious doctrine. This principle applies with equal force to church disputes over church polity and church administration. The court noted that First Amendment values are not jeopardized by a civil court's enforcement of a voting member's right to examine the church's records. It specifically addressed the court's role in such a dispute over examination of church records as follows:
The role that a civil court is required to play in enforcing a voting member's right to inspect the records that his non-profit church corporation is required by the non-profit corporation law to keep at its registered office is severely circumscribed. *1051 The records which a voting member is entitled to examine are limited to records of members' and directors' meetings, lists of members, records of assets, liabilities and financial transactions, and records of trust funds. The court is called upon merely to order the non-profit corporation to allow an examination at a reasonable time and perhaps to determine whether the corporation has complied with its judgment.
See also Jefferson v. Franklin, 96-1389 (La.App. 3d Cir.3/5/97), 692 So. 2d 602, wherein the trial court properly ordered that church members be allowed to review church records under La. R.S. 12:223(C).
The plaintiffs have been given opportunities to examine the church's records, including a court-mandated meeting at which the church complied with the court's order by supplying the records at the church's fellowship hall. While the plaintiffs complain that there were no "accounting records" that could be easily reviewed by them, just "source documents," there is nothing before us to suggest that the manner in which the church's financial records are maintained is inadequate or that the records are incomplete.[5] The information the plaintiffs sought was available but they chose not to conduct a detailed examination. Furthermore, during the period of more than a year between the filing of suit and the filing of the motion for summary judgment, the plaintiffs failed to depose any witnesses, including Knapp. Based upon these factors, we believe the plaintiffs had adequate time for discovery and that the motion for summary judgment was not premature.[6]
Since filing suit in January 2008, the plaintiffs have not put forth any evidence supporting their accusations of "gross mismanagement" and "gross and persistent ultra vires acts." The joint affidavit of the four original plaintiffs failed to set forth facts tending to prove their allegations; instead, the plaintiffs asked questions and listed what they wanted to know. Based upon the record before us, we cannot say that the plaintiffs have demonstrated that there are genuine issues of material fact sufficient to defeat the defendants' request for summary judgment.
Accordingly, like the trial court, we find that summary judgment in favor of the defendants is warranted under the facts of this case.
CONCLUSION
The trial court ruling granting summary judgment in favor of the defendants, T. *1052 Alexander Knapp and Mount Calm Baptist Church of Minden, Louisiana, is affirmed. Costs of this appeal are assessed to the plaintiffs/appellants.
AFFIRMED.
APPLICATION FOR REHEARING
Before BROWN, WILLIAMS, GASKINS, CARAWAY and LOLLEY, JJ.
Rehearing denied.
NOTES
[1] Evidence presented at the hearing indicated that Baker was no longer a church member.
[2] This article states:
When the answer to an interrogatory may be derived or ascertained from the business records, including electronically stored information, of the party upon whom the interrogatory has been served or from an examination, audit, or inspection of such business records, including a compilation, abstract, or summary based thereon, and the burden of deriving or ascertaining the answer is substantially the same for the party serving the interrogatory as for the party served, it is a sufficient answer to such interrogatory to specify the records from which the answer may be derived or ascertained and to afford to the party serving the interrogatory reasonable opportunity to examine, audit, or inspect such records and to make copies, compilations, abstracts, or summaries. A specification shall be in sufficient detail to permit the interrogating party to locate and to identify, as readily as can the party served, the records from which the answer may be ascertained.
[3] Our examination of these items reveals a membership roll of 379 current church members, 239 of whom signed letters in support of Knapp and the deacons. (The 379 number does not include persons who were marked on the rolls as nonmembers, deceased, students away, membership moved, or military; however, we included convalescents, one of whom signed a letter for Knapp.) There were also signed letters from eight persons whose names did not appear on the rolls. Thus, the defendants provided proof that about 63 percent of the church members supported them.
[4] Although counsel for the plaintiffs complained about the defendants' responses to their interrogatories, the plaintiffs' motion to compel was not specifically mentioned at the hearing on the motion for summary judgment.
[5] We note that La. R.S. 12:223(B) requires only that the corporate records be kept in written form or in any other form capable of being converted into written form within a reasonable time.
[6] See and compare American Bank & Trust Co. In Monroe v. Cambre, 486 So. 2d 1076 (La.App. 2d Cir. 1986) (two months between filing of suit and motion for summary judgment was adequate time for discovery); Simoneaux v. E.I. du Pont de Nemours and Co., Inc., 483 So. 2d 908 (La.1986) (trial court properly granted summary judgment within six months of filing of suit even though pending motion to compel and two unanswered discovery requests); Fisk v. Mathews, 525 So. 2d 223 (La.App. 1st Cir.1988) (party could not prevent summary judgment where it made no showing that serious efforts at discovery had been made); Guillory v. Dr. X, 96-85 (La.App. 3d Cir.8/28/96), 679 So. 2d 1004 (one and one-half years afforded plaintiff ample time in which to gather some evidence to support the allegations of her petition); Barron v. Webb, supra (summary judgment was not premature where plaintiff failed to take depositions of witnesses and submitted only conclusory affidavit in opposition to motion for summary judgment); Orillion v. Alton Ochsner Medical Foundation, 97-115 (La.App. 5th Cir.5/28/97), 695 So. 2d 1063, writ denied, 97-1725 (La.10/13/97), 703 So. 2d 617 (one year between the petition and motion for summary judgment had given parties adequate time for discovery). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580855/ | 919 F. Supp. 1093 (1996)
Benny ALLEN, Jr., et al., Plaintiffs,
v.
ETHICON, INC., et al., Defendants.
No. C-1-94-256.
United States District Court, S.D. Ohio, Western Division.
January 30, 1996.
*1094 *1095 Benny Allen, Jr., Cincinnati, OH, pro se.
Diane Kraus, Williamsburg, OH, pro se.
Roger Alan Weber, Taft, Stettinius & Hollister, Cincinnati, OH, for defendants.
ORDER
HERMAN J. WEBER, District Judge.
This matter is before the Court upon the Report and Recommendation of the United States Magistrate Judge (doc. no. 33) to which neither party has objected.
Upon a review of the record, the Court finds that the Judge has accurately set forth the applicable law and has properly applied it to the particular facts of this case. Accordingly, in the absence of any objection by plaintiff, this Court accepts the Report as uncontroverted.
The Report and Recommendation of the United States Magistrate Judge (doc. no. 33) is hereby ADOPTED. Defendants' Motion for Summary Judgment as to Allen's Age Discrimination Claims is GRANTED; defendants' Motion for Summary Judgment as to Allen's Race Discrimination Claims is GRANTED; defendants' Motion for Summary Judgment as to Kraus's Sex Discrimination Claims is GRANTED; defendants' Motion for Summary Judgment as to Allen's Breach of Contract and Promissory Estoppel Claims is GRANTED; defendants' Motion for Summary Judgment as to Kraus's Breach of Contract and Promissory Estoppel Claims is GRANTED.
Plaintiff's Complaint is DISMISSED WITH PREJUDICE. This case is TERMINATED on the docket of this Court.
IT IS SO ORDERED.
REPORT AND RECOMMENDATION
STEINBERG, United States Magistrate Judge.
This matter is before the Court on the responses of plaintiffs Benny Allen, Jr. and Diane Kraus to the Court's order to show *1096 cause why summary judgment should not be entered against them (Docs. 29, 30) and the memorandum in support of summary judgment by Defendants Ethicon, Inc. (Ethicon) and Ethicon Endo-Surgery. (Doc. 31).
Allen and Kraus bring this discrimination and breach of contract action alleging discrimination claims under the Age Discrimination in Employment Act (ADEA) 29 U.S.C. § 621 et seq., Title VII of the Civil Rights Act of 1964 as amended 42 U.S.C. § 2000e et seq., 42 U.S.C. § 1981, and Ohio Rev.Code §§ 4112.02 and 4112.99, as well as breach of contract and promissory estoppel claims under Ohio common law. Defendants contend that summary judgment as to the discrimination claims is proper because Allen has failed to establish a prima facie race or age discrimination case and Kraus has failed to establish a prima facie sex discrimination case. Defendants also contend that plaintiffs failed to demonstrate that defendants' articulated non-discriminatory reason for their termination was pretextual. Defendants argue that summary judgment as to the breach of contract claims by Allen and Kraus is proper because they were at-will employees who never entered into an enforceable employment agreement and they cannot establish the necessary elements of a promissory estoppel claim.
Allen and Kraus filed this action on March 3, 1994. (Doc. 1). On March 3, 1995, plaintiffs' counsel filed a motion to withdraw as trial attorney. (Doc. 18). On July 24, 1995 this Court granted the motion. (Doc. 27). Allen and Kraus are now proceeding pro se.
UNDISPUTED FACTS
Ethicon, Inc. is an Ohio corporation and wholly owned subsidiary of Johnson and Johnson. (Doc. 31, Def.'s memo., p. 8). Allen and Kraus were employed by Ethicon, Inc. in the endo-surgery division's human resources department (HRD). Director of Human Resources Robert L. Ward supervised Allen. Allen supervised Kraus until April 1993 when Director of Organizational Development and Training Maureen Nash became Kraus's supervisor. On September 1, 1993, after Kraus and Allen were terminated, Ethicon and Ortho Diagnostic Systems, Inc. a New Jersey corporation organized a partnership under New Jersey law by the name of Ethicon Endo-Surgery, Inc., the other defendant in this case. (Id. at p. 9).
A. Ethicon's Endo-Surgery Division was Reorganized to Improve Its Efficiency and Financial Performance
In 1992, Ethicon, Inc.'s endo-surgery division lost approximately ninety-three million dollars. (Doc. 31, Def.'s memo., Ward aff. and attachment A). Due to this lack of profitability, Ethicon's senior management hired a consulting firm to analyze the division's financial performance and develop new strategies. (Id.). Following this review, Ethicon's endo-surgery division was reorganized per the following plan: (1) redesign the division's organizational structure; (2) create a surgical procedure and team oriented division; and, (3) improve efficiencies and eliminate redundancies among the division's support services. (Id.). As part of the reorganization, the HRD was reorganized to provide organizational development rather than training services. (Doc. 31, Def.'s memo., pp. 11-12).
After the endo-surgery division defined its new organizational structure, it developed job descriptions based on the "skill sets" and "core competencies" necessary for each position in the division. (Id. at p. 12). Allen and Kraus were not involved in this process. (Id.). Ethicon assessed all current employees, including Allen and Kraus, to identify their skills and evaluate their compatibility with a new position. The factors used to determine if an employee was qualified for a position in the endo-surgery division included the following: (1) possession of required "skill sets"; (2) "core competencies"; and, (3) demonstrated performance. Incumbent employees whose skills matched those required for a new position were retained. Employees whose skills and experience were determined to be a mismatch were considered for reassignment, and employees whose skills did not fit a new position were "outplaced." (Id. at p. 13). Ward and Nash evaluated Allen and Kraus based on these criteria.
Ethicon conducted statistical adverse impact studies to verify that the reorganization *1097 process and its resulting lay offs would not adversely affect employees on the basis of age, race, or sex. (Doc. 31, Def.'s memo., p. 14 and Ward Aff., attachments B, C, D). Ethicon's statistical analysis indicates that a higher percentage of white employees, male employees, and employees under the age of forty were laid off than employees in a protected class. (Id.).
B. The Plaintiffs
Plaintiff Benny Allen, a black male, worked for Ethicon's endo-surgery division for twenty-one years and was forty-nine years old at the time of his termination. (Doc. 30, Allen's resp., p. 1). As the HRD Senior Personnel Administrator, he administered organizational development and training programs including workplace literacy, team development, manufacturing practices, communication skills training, and problem-solving skills. (Doc. 30, Allen's resp., p. 2; Doc. 31, Def.'s memo., p. 16) Allen also worked in other HRD areas, such as recruitment, affirmative action programming, and employee relations. (Doc. 30, Allen's resp., p. 2). As part of the endo-surgery division's reorganization, Ethicon reorganized the HRD and redefined Allen's position. Ward and Nash evaluated all HRD employees, including Allen, based on their skills, experience, and performance. (Doc. 31, Def.'s memo., p. 16). Ward and Nash perceived that Allen lacked the skills, education, and expertise in the human relations field necessary for a position in the reorganized HRD. (Doc. 31, Def.'s memo., p. 17). They determined that his skills and experience did not match any other position within the company. (Doc. 31, Def.'s memo., p. 19; Doc. 30, Allen resp., p. 3). Ward and Nash informed Allen that he was being laid off for these reasons. (Doc. 31, Def.'s memo., p. 19). On July 30, 1993, Ethicon terminated Allen's employment. (Doc. 31, Def.'s memo, p. 19; Doc. 30, Allen resp., p. 3). Thereafter, Lisa Pierce, a younger white female and Allen's former secretary, was promoted to assume some of Allen's former duties while an unnamed white male was hired to perform the rest of his duties. (Id. at p. 3).
Plaintiff Diane Kraus was a Senior Training Coordinator and had worked at Ethicon for over seven years at the time of her lay off. (Doc. 31, Def.'s memo., p. 20; Doc. 29, Kraus's resp., Ex. 21). Kraus's job responsibilities included conducting training classes, developing training activity evaluation criteria, preparing training outlines and visual aids, scheduling training courses, locating and contacting outside instructors for organizational training courses, and coordinating paperwork for tuition reimbursement. (Id.). As a result of Ethicon's reorganization, Kraus's position was eliminated. (Id. at p. 22). Ward and Nash evaluated Kraus based on her skills, experience, and performance. They determined that she lacked the skills and experience required for a position with the reorganized company. (Id. at p. 23). On July 30, 1993, Ethicon terminated her employment. (Id. at pp. 20-21).
C. The Johnson and Johnson Credo
The Johnson and Johnson Credo was written over forty years ago by then Chairman of the Board Roberts Wood Johnson. (Doc. 29, Kraus's resp., Ex. 1). The Credo outlines the company's philosophy concerning its responsibilities to the medical professionals and consumers who use its products, its stockholders and employees, and the communities in which it operates. (Id.). The Credo states in pertinent part:
We are responsible to our employees, the men and women who work with us throughout the world. Everyone must be considered an individual. We must respect their dignity and recognize their merit. They must have a sense of security in their jobs. Compensation must be fair and adequate, and working conditions clean, orderly, and safe. Employees must feel free to make suggestions and complaints. There must be equal opportunity for employment, development, and advancement for those qualified. We must provide competent management, and their actions must be just and ethical.
(Doc. 31, Def.'s memo., p. 49; Doc. 29, Kraus resp., Ex. 1, ¶ 2). The Credo is widely circulated among all Johnson and Johnson employees, posted in company offices, and used as the basis for an Ethicon employee satisfaction survey conducted every eighteen months. (Doc. 31, Def.'s memo., pp. 49-50; *1098 Doc. 29, Kraus resp., pp. 1-2). Johnson and Johnson also includes copies of the Credo in the company's annual reports. (Id.). As Ethicon employees, both Allen and Kraus received copies of the Credo. They discussed it with new employees during orientation training sessions and participated in Credo surveys. (Doc. 29, Kraus resp., p. 2; Doc. 30, Allen resp., p. 3).
DEFENDANTS' SUMMARY JUDGMENT MOTION ON ALLEN'S RACE AND AGE DISCRIMINATION CLAIMS AND KRAUS'S SEX DISCRIMINATION CLAIMS SHOULD BE GRANTED
Defendants contend that summary judgment as to the discrimination claims by Allen and Kraus is proper because they fail to come forward with evidence sufficient to establish a prima facie discrimination case. Defendants contend that neither Allen nor Kraus offered any evidence tending to indicate that Ethicon management singled them out for termination based on their membership in a protected group. Defendants argue that the only reason Allen and Kraus were terminated is that they both lacked the appropriate skills for a position within the reorganized company. Defendants also argue that even if plaintiffs established a prima facie case, they failed to offer any evidence that contradicts defendants' legitimate non-discriminatory reason for their termination. Defendants contend that Allen's performance began to deteriorate in the months before his termination and that he engaged in unethical conduct by hiring an outside consultant with whom he was having an amorous relationship.
Allen argues that Ethicon's decision to discharge him was based on his race and age. Allen asserts that his request for reassignment to a position for which Ward and Nash found him qualified was denied while other white employees were reassigned. He cites this as evidence of racial discrimination. Allen contends that Ethicon terminated his employment prior to his fiftieth birthday to save the company approximately two million dollars in wages and benefits. Allen also argues that he was denied reassignment in the organization because of his age while Pierce and an unnamed younger white male were promoted to assume his duties. Allen alleges that in 1992 and 1993 Ward denied his requests to attend a training seminar but sent Pierce, who had no training responsibilities, to the same seminar. He claims this demonstrates that he was discriminated against because of his race and age. Allen contends that the company hired younger people to perform the duties he had been performing since 1989.
Kraus contends that Ethicon discharged her because of her sex. She claims that an unnamed male who lacked her level of qualification was promoted to the safety coordinator. Kraus also claims that an unnamed male in her department was transferred to another department while she was denied a transfer. Kraus asserts that, after the reorganization, a male was hired to take over her former position as training administrator.
The same evidentiary framework applies to discrimination claims brought under Title VII, the ADEA, 42 U.S.C. § 1981, and discrimination claims brought under Ohio state law. Mitchell v. Toledo Hospital, 964 F.2d 577, 582 (6th Cir.1992). A plaintiff may establish a prima facie case by presenting either direct or circumstantial evidence of discrimination. Manzer v. Diamond Shamrock Chemicals Co., 29 F.3d 1078, 1081 (6th Cir.1994); McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S. Ct. 1817, 1824, 36 L. Ed. 2d 668 (1973); Ackerman v. Diamond Shamrock Corp., 670 F.2d 66 (6th Cir. 1982). A plaintiff may establish a prima facie case through the following circumstantial evidence: (1) she is a member of the protected class; (2) she was discharged; (3) she was performing satisfactorily; (4) she was replaced by a person outside the protected class; and, (5) where plaintiff is discharged as the result of a reduction in force or corporate reorganization, as in the present case, she must come forward with "additional direct, circumstantial, or statistical evidence tending to indicate that the employer singled out the plaintiff for discharge for impermissible reasons." Barnes v. GenCorp Inc., 896 F.2d 1457, 1465 (6th Cir.1990); Allen v. Diebold, Inc., 33 F.3d 674, 677-78 (6th Cir.1994). *1099 In other words, plaintiffs must show that age, race, or sex was a determining factor in the adverse action the employer took against them. Wilson v. Firestone Tire & Rubber Co., 932 F.2d 510, 514 (6th Cir.1991).
The employment discrimination statutes were not intended to protect workers from the harsh economic realities of common business decisions and the hardships associated with corporate reorganizations, downsizing, plant closings, and relocations. Allen at 677. Plaintiffs must establish that the employer discriminated against them because they were in the protected group, not because they were expensive to retain. Id. See also Hazen Paper Co. v. Biggins, 507 U.S. 604, 609-11, 113 S. Ct. 1701, 1706, 123 L. Ed. 2d 338 (1993). The statutes do not bar the discharge of employees, but only prohibit employers from discriminating against them because they are members of a protected class. Id. at 679. The employer is entitled to summary judgment if the plaintiff does not establish a prima facie case. Mitchell, 964 F.2d at 582-84.
Plaintiff Allen Has Failed to Establish a Prima Facie Race or Age Discrimination Case
In the instant case, Allen offers no evidence that defendants terminated his employment because of his age. Allen's contention that Ethicon terminated his employment to save approximately two million dollars, even if true, does not state an age discrimination claim. See Allen, 33 F.3d at 677. Allen alleges that younger employees were hired to replace him and that some white employees were offered reassignment while his request for reassignment was denied. Yet Allen fails to come forward with any direct, circumstantial, or statistical evidence to contradict the results of Ethicon's adverse impact study which indicates that a higher percentage of white employees and employees under forty were laid off than employees in a protected class. Allen concedes that Nash told him he was being terminated because his skills did not match those necessary for a position in the reorganized company. Allen fails to present evidence sufficient to create a genuine issue of material fact in support of his assertion that he was terminated because of his race or his age. For the foregoing reasons, defendants' summary judgment motion on Allen's race and age discrimination claims should be granted.
Plaintiff Kraus Has Failed to Establish a Prima Facie Sex Discrimination Case
In the instant case, plaintiff Kraus has failed to offer any evidence that she was discharged because she is a woman. Ethicon's adverse impact analysis demonstrates that the company terminated a greater percentage of men than women as a result of the reorganization. Kraus fails to offer any direct, circumstantial or statistical evidence to contradict these findings. Kraus offers no evidence that she possessed superior or equivalent qualifications in comparison to the unnamed male who was promoted or the male who was hired as training administrator following her termination. Standing alone, her allegations that these men were not as qualified as her are insufficient to create a genuine issue of material fact and avoid summary judgment. Kraus fails to offer any evidence indicating that she was terminated because of her sex. For the foregoing reasons, defendants' summary judgment motion on Kraus's sex discrimination claims should be granted.
DEFENDANTS' SUMMARY JUDGMENT MOTION ON PLAINTIFFS' BREACH OF CONTRACT AND PROMISSORY ESTOPPEL CLAIMS SHOULD BE GRANTED
Allen and Kraus contend that defendants breached an implied employment agreement by terminating their employment. Allen asserts that the Credo and the employee handbook constituted promises of continued employment upon which he reasonably relied. Specifically, Allen contends that the Credo and non-discrimination language in the employee handbook represent specific promises of lifetime employment. (Doc. 30, Allen resp., pp. 4-5).
Kraus contends that because the Credo was posted throughout Johnson and Johnson offices, including Ethicon, circulated among incoming employees during orientation, reprinted in the company's annual reports, and *1100 used as the basis for employee satisfaction surveys every eighteen months it constitutes a specific promise on which she and other employees reasonably relied. Kraus argues that passages in the book entitled Johnson and Johnson: A Century of Caring, which she received from Ethicon as a gift, chronicle Johnson and Johnson's history of refraining from lay offs during periods of economic difficulty and led her to believe that Ethicon would not lay off employees following the 1993 reorganization. Kraus alleges that other unnamed employees told her that when they were hired they were promised job security. Kraus also argues that a meeting she had with Nash to develop an HRD training schedule for 1994 is evidence of a promise that her employment at Ethicon would continue.
Under Ohio law, an employee who is hired for an indefinite period of time is an employee at will. Henkel v. Educational Research Council of America, 45 Ohio St. 2d 249, 344 N.E.2d 118, syllabus (1976). Either party to an at-will employment agreement may terminate the relationship, and the employee is subject to discharge at any time for any reason not contrary to law. Id. at 255, 344 N.E.2d at 122. An employment contract is presumptively at-will unless facts and circumstances indicate that the agreement is for a specific term. Id. In 1985, the Ohio Supreme Court rejected a request to abandon the employment-at-will doctrine. Mers v. Dispatch Printing Co., 19 Ohio St. 3d 100, 103, 483 N.E.2d 150, 153-54 (1985). In doing so, however, it recognized that there are occasions when exceptions to the general rule are recognized in the interest of justice. Two such exceptions are: (1) the existence of express or implied contractual provisions that alter the terms of discharge; and, (2) the existence of promissory estoppel stemming from promises made to the employee regarding the terms of discharge. Id. at 104, 483 N.E.2d at 154.
The elements necessary to demonstrate modification of an employment-at-will agreement are generally the same whether the plaintiff relies on an implied contract or a promissory estoppel theory. See Nitz v. Goodyear Tire & Rubber Co., 1995 WL 500073, *2 (Ohio Ct.App.1995) (citing Gargasz v. Nordson Corp., 68 Ohio App. 3d 149, 155, 587 N.E.2d 475, 478 (1991)). Praise with respect to job performance and discussions of future career development standing alone will not modify an employment-at-will relationship. Helmick v. Cincinnati Word Processing, Inc., 45 Ohio St. 3d 131, 136, 543 N.E.2d 1212, 1216 (1989). Plaintiffs must establish that defendants made a clear and unambiguous offer or promise. See Tersigni v. General Tire, Inc., 91 Ohio App. 3d 757, 760-61, 633 N.E.2d 1140, 1142 (1993); Wing v. Anchor Media, Ltd. of Texas, 59 Ohio St. 3d 108, 110-11, 570 N.E.2d 1095, 1098-99 (1991). See also Kasuri v. St. Elizabeth Hospital Medical Center, 897 F.2d 845 (6th Cir.1990). Plaintiffs must demonstrate reasonable reliance on defendants' offer or promise. Sowards v. Norbar, Inc., 78 Ohio App. 3d 545, 551-52, 605 N.E.2d 468, 472 (1992); Kelly v. Georgia-Pacific Corp., 46 Ohio St. 3d 134, 139-40, 545 N.E.2d 1244, 1250 (1989). Plaintiffs must also demonstrate consideration or substantial detrimental reliance upon the promise. See Tersigni, 91 Ohio App.3d at 759, 633 N.E.2d at 1142; Wing, 59 Ohio St.3d at 110-11, 570 N.E.2d at 1099. See also Snyder v. Ag Trucking, Inc., 57 F.3d 484, 488-489 (6th Cir.1995); Humphreys v. Bellaire Corp., 966 F.2d 1037, 1040-41 (6th Cir.1992).
The Credo is not a specific promise of job security or continued employment but rather an articulation of Johnson and Johnson's aspirational goals and ideals. See Tripodi v. Johnson & Johnson, 877 F. Supp. 233, 239-40 (D.N.J.1995). The Credo was circulated among Defendants' employees, suppliers, shareholders, and customers. Clearly, the Credo does not constitute a contract to guarantee a profit to defendants' shareholders, suppliers, or distributors. Nor does the Credo create an employment agreement between defendants and their employees. See Id. at 240. Assuming, as Allen alleges, that the Credo constitutes a promise of life time employment, under Ohio law such a promise is an offer of employment for an indefinite period; therefore, it is terminable at will. See Henkel, 45 Ohio St.2d at 255, 344 N.E.2d at 121-22.
*1101 The Ethicon employee handbook contains a disclaimer stating that it does not constitute a contract of employment. As employees in the HRD, both Allen and Kraus were aware of this disclaimer and were aware that all Ethicon employment agreements contained clauses stating that employment was at-will. Allen fails to present any evidence of specific promises or representations made to him by Ward, Nash or any other Ethicon employee that he would remain employed for a definite period of time. Kraus also fails to offer any evidence of a specific promise of continued employment. The fact that Kraus had a meeting with Nash in which they planned the training schedule for 1994 does not constitute a specific employment promise. For the foregoing reasons Defendants' summary judgment motion on the breach of contract and promissory estoppel claims by Allen and Kraus should be granted.
IT IS THEREFORE RECOMMENDED THAT:
1) Defendants' motion for summary judgment as to Allen's age discrimination claims be GRANTED.
2) Defendants' motion for summary judgment as to Allen's race discrimination claims be GRANTED.
3) Defendants' motion for summary judgment as to Kraus's sex discrimination claims be GRANTED.
4) Defendants' motion for summary judgment as to Allen's breach of contract and promissory estoppel claims be GRANTED.
5) Defendants' motion for summary judgment as to Kraus's breach of contract and promissory estoppel claims be GRANTED.
Date: 1-10-96. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580885/ | 42 So. 3d 855 (2010)
Luis GOMAR, Appellant,
v.
RIDENHOUR CONCRETE AND SUPPLY, and AMCOMP Preferred Insurance Company, Appellees.
No. 1D09-4506.
District Court of Appeal of Florida, First District.
August 10, 2010.
*856 Bradley Guy Smith of Smith, Feddeler, Smith & Miles, P.A., Lakeland; Susan W. Fox of Fox & Loquasto, P.A., Tampa; Richard W. Ervin, III, of Fox & Loquasto, Tallahassee, for Appellant.
Lori Pearson-Wise of the Law Office of Lori Pearson-Wise, P.A., Maitland, for Appellees.
PER CURIAM.
At issue in this workers' compensation appeal is whether section 440.13(5)(a), Florida Statutes, permits a claimant, who previously obtained an independent medical examination on the issue of compensability, to have a subsequent independent medical examination on the issue of maximum medical improvement if he disputes that determination.
The order on review denies Appellant/Claimant Luis Gomar's petition for benefits seeking orthopedic care and pain management. The petition for benefits was filed approximately two years after his authorized treating physicians deemed him at maximum medical improvement ("MMI"). In support of his petition for benefits, Mr. Gomar obtained an updated independent medical examination ("IME") from the same physician who conducted his initial IME. The updated IME concluded that Mr. Gomar has not reached MMI. The Judge of Compensation Claims' ("JCC") disallowed evidence relating to the second IME, because section 440.13(5)(a) states a party may have only one IME per accident. We find the ruling in error, and reverse.[1]
Facts
On April 12, 2006, Mr. Gomar sustained a work-related injury which aggravated a non-work-related and preexisting condition. He filed an initial petition for benefits on November 17, 2006, seeking compensability of the work-related aggravation injury and temporary disability benefits; the Employer/Carrier ("E/C") promptly denied this petition for benefits. Mr. Gomar filed a second petition for benefits on December 19, 2006, requesting payment of medical bills and authorization of medical care, which the E/C also denied. Also on that date, Mr. Gomar underwent an IME with Dr. Simon, who diagnosed him with cervical radiculopathy and a cervical strain; concluded that the work injury was the major contributing cause of aggravation to a pre-existing neck condition; and recommended physical therapy and nerve blocks. Based on the IME, the E/C acknowledged compensability of the injury and authorized Dr. Weber as Mr. Gomar's treating physician.
Mr. Gomar saw Dr. Weber in early June 2007 complaining of neck pain and numbness in his hands. Dr. Weber initially diagnosed him with cervical radiculitis and, following a physical and neurological examination, prescribed physical therapy and medication. But on June 28, 2007, after *857 reviewing an ordered cervical MRI and again physically examining Mr. Gomar, Dr. Weber opined that the work-related injury was no longer the major contributing cause of Mr. Gomar's current condition, which included severe neck pain and intermittent pain in his arms; rather, the pre-existing neck condition was the major contributing cause. Dr. Weber placed Mr. Gomar at MMI with a 0% impairment rating as to his work-related injury.
After requesting and receiving a one-time change in his authorized treating physician, Mr. Gomar saw Dr. Flynn, an orthopedist, on August 23, 2007, still complaining of neck and arm pain. Dr. Flynn ordered an EMG/NCS (electromyogram and nerve conduction study), which was performed in early September 2007. On November 1, 2007, following another physical examination and review of the EMG/ NCS results, Dr. Flynn diagnosed Mr. Gomar with neck and arm pain after work-related injury and temporary aggravation of preexisting degenerative cervical spondylosis. He prescribed no treatment, and placed Mr. Gomar at MMI as of that date with 0% impairment from the work injury. The E/C subsequently discontinued benefits.
Mr. Gomar returned to Dr. Flynn on March 20, 2008, again complaining of neck pain, and also pain radiating into his upper back and thoracic area. Dr. Flynn ordered an MRI of the thoracic spine, which revealed some mild degenerative changes that occur over time and not due to acute injury. No spinal cord abnormalities were seen. He thus maintained Mr. Gomar's date of MMI at November 1, 2007.
On March 17, 2009, Mr. Gomar filed the petition for benefits at the center of this appeal. After this was denied by the E/C, he underwent an "updated" IME with Dr. Simon directed to whether he has in fact reached MMI. At the final hearing, the JCC excluded from evidence all testimony and records related to the 2009 IME because section 440.13(5)(a) allows parties to have only one IME per accident.[2] As a result, the JCC had before it only the records and testimony of Dr. Simon regarding the 2006 IME establishing Mr. Gomar's initial need for treatment after his work-related injury, and the records and testimony of authorized treating physicians Drs. Weber and Flynn placing Mr. Gomar at MMI in 2007. The JCC denied the petition for benefits, finding no evidence that Mr. Gomar's pain and need for treatment were attributable to the work-related injury.
Analysis
Section 440.13(5)(a), Florida Statutes (2005), provides, in pertinent part:
In any dispute concerning overutilization, medical benefits, compensability, or disability under this chapter, the carrier or the employee may select an independent medical examiner.... The employer and employee shall be entitled to only one independent medical examination per accident and not one independent medical examination per medical specialty.
We disagree with the JCC's restrictive reading of this provision, as it essentially forever limits a party to one IME.
In Cortina v. State, Department of HRS, 901 So. 2d 273, 274 (Fla. 1st DCA 2005), we stated that "the only condition required for a party to request an IME [under section 440.13(5)(a) ] is a dispute." (Emphasis in original.) In other words, when "any dispute concerning overutilization, medical benefits, compensability, or *858 disability" arises, a claimant or employer may request an IME. § 440.13(5)(a), Fla. Stat. (emphasis added).
The claimant in Cortina had been receiving treatment from an authorized psychiatrist, but following the doctor's determination that she had reached MMI, her claim for temporary partial disability benefits was denied. Cortina, 901 So.2d at 275. We held that the claimant's disagreement with the MMI determination and the e/c's denial of benefits created a dispute, thus entitling her to an IME under section 440.13(5)(a). Id.
Here, as in Cortina, the E/C denied Mr. Gomar's petition for benefits based on the findings of the authorized treating physicians that he has reached MMI. Mr. Gomar disagrees with that determination in light of his apparently incessant pain since the date of his workplace injury. "[W]hen an employer authorizes evaluation and treatment of a claimant, but after receiving the diagnosis of the treating physician the claimant disagrees with it, a dispute is created and the claimant may request an IME." Id. at 274.
We recognize, of course, that the date of accident dictates which version of a substantive statute applies. See, e.g., Kaloustian v. Tampa Armature Works, Inc., 5 So. 3d 753, 754 (Fla. 1st DCA 2009) (holding JCC reversibly erred in applying the post-October 1, 2003, version of section 440.34(3) to a claim with a pre-October 1, 2003, date of accident); Bell v. Univ. of Fla., 652 So. 2d 460, 461 (Fla. 1st DCA 1995) (restating that substantive workers' compensation rights are fixed at the time of injury). We also acknowledge that Cortina involved the 1996 version of section 440.13(5) which, as with the 2005 version, provided for an IME "[i]n any dispute concerning overutilization, medical benefits, compensability, or disability under this chapter ...." § 440.13(5)(a), Fla. Stat. (1996).
For purposes of the issue before us now, the crucial difference between the 1996 and 2005 versions of this section is that the latter limits a party to "only one independent medical examination per accident and not one independent medical examination per specialty." § 440.13(5)(a), Fla. Stat. (2005). The Legislature did not, however, change the language regarding entitlement to an IME in any "dispute concerning overutilization, medical benefits, compensability, or disability." Id. (emphasis added). Furthermore, in both versions of the statute, "independent medical examiner" is defined as "a physician selected by either an employee or a carrier to render one or more independent medical examinations in connection with a dispute arising under this chapter." (Emphasis added.)
When read in pari materia, we think that the only way to read these three provisions harmoniously is to interpret section 440.13(5)(a) as allowing for one independent medical examiner per accident, and not, as was formerly the case, one per specialty. We observe that in the clause "only one independent medical examination per accident and not one independent medical examination per specialty," the exclusionary phrase "and not" is indicative of the legislature's intent. Prior to the 2003 amendment, parties could use section 440.13(5)(a) to obtain IMEs for multiple specialties. The logical purpose of the amendment was intended to prevent utilization of multiple IMEs in various specialties, not to prevent a party from providing updated medical evidence with its designated examiner concerning a new issue. This is logical because, as demonstrated here, a workers' compensation claim can extend over a period of years, *859 during which time a claimant's condition may change and issues such as maximum medical improvement date, work restrictions and impairment ratings may arise.
To hold that a party is allowed by statute to obtain an examination by its chosen independent medical examiner only one time, despite the fact that these issues may, and often do, arise long after the initial examination, would lead to a reductio ad absurdum. Thus, we hold that each party is entitled to an IME for each covered dispute during the life of a claim, so long as it is performed by the same examiner.[3]
Here, Mr. Gomar's challenge to the opinions of Drs. Weber and Flynn placing him at MMI raises a new dispute for which he is entitled to seek a newor in this case "updated"IME. In Wal-Mart Stores, Inc. v. Liggon, 668 So. 2d 259, 261-64 (Fla. 1st DCA 1996), we held that the employer's request for a second IME was reasonable because more than a year had passed since the first IME, and a dispute arose as to the claimant's work restrictions and entitlement to permanent total disability benefits. We acknowledge that the court in Liggon addressed the 1991 version of section 440.13. That version provided that the right to conduct an IME included, but was not limited to
instances when the authorized treating physician has not provided current medical reports; determining whether overutilization by a health care provider has occurred; whether a change in health care provider is necessary; or whether treatment is necessary or the employee appears not to be making appropriate progress in recuperation.
§ 440.13(2)(c), Fla. Stat. (1991). In other words, parties were entitled to an IME when issues (i.e., disputes) arose during the life of a claim which required a medical opinion based on the claimant's independent medical examination.
Here, because the JCC prohibited Mr. Gomar from putting into evidence the results of the new IME and the IME physician's deposition testimony, we REVERSE the order denying his petition for benefits and REMAND for further proceedings consistent with this opinion.
THOMAS, ROBERTS, and MARSTILLER, JJ., concur.
NOTES
[1] Because we find this issue dispositive, we do not reach the second issue raised by Mr. Gomar.
[2] We review de novo the JCC's interpretation and application of the statute, as it is a question of law. See Lanham v. Dep't of Envtl. Prot., 868 So. 2d 561, 562 (Fla. 1st DCA 2004).
[3] This limitation is subject to the exception found in section 440.13(5)(b), Florida Statutes (2005), which provides for an "alternate" independent medical examiner under certain enumerated circumstances. We are not called upon to interpret this provision and decline to do so here. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580879/ | 147 N.W.2d 824 (1967)
Joseph GIARRATANO, Administrator of the Estate of Erwin A. Giarratano, Deceased, Appellant,
v.
The WEITZ COMPANY, Inc., Appellee.
No. 52089.
Supreme Court of Iowa.
January 10, 1967.
*826 Fairall & Kilbride, Marshalltown, and Lundy, Butler, Wilson & Hall, Eldora, for appellant.
Bannister, Carpenter, Ahlers & Cooney, Des Moines, for appellee.
MASON, Justice.
This is a law action to recover damages for wrongful death of an 18-year-old boy who fell 80 feet from a roof under construction at the Iowa Electric Light & Power Company near Marshalltown on June 7, 1960, and suffered fatal injuries. Plaintiff is administrator of Erwin A. Giarratano's estate.
Defendant, The Weitz Company, Inc., an Iowa corporation, was engaged as principal contractor to construct an addition to a building for the light company under a written contract between defendant and the property owner. Plaintiff's decedent was an employee of Anning-Johnson Company, a subcontractor engaged by defendant to construct and apply a poured gypsum roof for the building addition.
Plaintiff pleaded as basis for recovery a breach of contract theory in division one of his petition as amended and a tort theory in division two.
At the conclusion of the evidence the court submitted the tort theory to the jury but refused to submit the breach of contract theory.
The jury returned a verdict of $75,000 for plaintiff which the court set aside on defendant's motion for judgment notwithstanding the verdict. Plaintiff appeals.
*827 I. The appeal presents two main questions: (1) Did the trial court err in sustaining defendant's motion and entering judgment for defendant? and (2) In the alternative, did the court err in (a) excluding certain evidence, (b) failing to submit the breach of contract theory and (c) failing to submit the no eyewitness rule?
In Division I of its motion defendant moved that the verdict and judgment in favor of plaintiff be set aside and judgment be entered in its favor and against plaintiff because the movant was entitled to have a verdict directed for it at the close of all the evidence, did move therefor and the jury did not return such verdict in favor of defendant.
Plaintiff assigns as errors relied on for reversal the sustaining of defendant's motion on the grounds (1) defendant owed no duty to and had no control over the safety of plaintiff's decedent, (2) defendant was not negligent as a matter of law, (3) any negligence of defendant was not the proximate cause of the accident, as a matter of law, (4) plaintiff failed to generate a jury question on decedent's freedom from contributory negligence, and (5) decedent had, as a matter of law, assumed the risk.
II. The court submitted as specifications of defendant's negligence (a) permitting plaintiff's decedent to work for Anning-Johnson under extremely hazardous conditions, (b) failing to provide a reasonably safe place for the work, and (c) failing to provide scaffolding and to properly and timely lay wire mesh after the asbestos board was laid.
III. Plaintiff's decedent, Erwin A. Giarratano, graduated from high school in Marshalltown June 5, 1960. Two days later he went to the light company's job site looking for temporary employment. Anning-Johnson, the roofing subcontractor hired Erwin to begin work at once. He had never done work of the type he was employed to do on June 7.
We are told the process of roof construction is as follows: There are steel girders or I beams every eight feet, which are a part of the structure itself. The I beams are about six inches high and eight inches across the top and bottom. "Bulb-tees" are placed atop and perpendicular to the I beams, spaced 32 inches apart and welded. The bulb-tees are steel rails about two inches in height with a three-inch flange at the bottom. After the bulb-tees are welded, pieces of 32" × 4' asbestos form boards are laid between the bulb-tees so as to rest on the flange at the bottom. The form board is brittle and will not support a man's weight. Next, wire mesh and strips 3½ or 4 feet wide are rolled over the steel and form boards. Finally, the gypsum in a slush form is pumped from the ground onto the roof and spread to a thickness of about two inches above the top of steel and wire. It hardens in 12 to 15 minutes.
The area to which Anning-Johnson was to apply a roof deck at the 80-foot level was approximately 35 feet north and south and 70 feet east and west. Before it undertook construction of the gypsum roof, the steel work was already in place and the bulb-tees were in place and welded; a temporary platform for storing materials and as a solid area to walk on after a person had climbed a stairway at the northeast corner of the structure, had been installed. This platform consisted of wood planks clear across the north and extending approximately five feet south of the north edge of the roof. The planking had not been furnished by the Anning-Johnson crew. The crew had unloaded material June 6 but did not work on the roof.
The day of Erwin's death the crew began working at 7:30 a. m. For about the first hour Erwin worked on the ground, preparing the gypsum for pouring. When one of the workers on the roof decided he would rather work on the ground, Anning-Johnson's foreman asked the ground crew if any of them would go to the roof to work. Erwin said, "I will try anything once." *828 The view to the south up to the 80-foot level was partially obstructed to persons climbing the stairs by steel grating, temporary wood flooring and equipment.
When Erwin went to the roof about 9 a. m. the process of laying form boards between the bulb-tees, rolling wire over the form boards and pouring gypsum had been completed in an area about ten feet wide, just south of the wood planked area. This finished gypsum surface paralleled the wood planks from the east to west of the roof and formed a solid walking surface from east to west for 15 feet south of the north edge of the roof.
Besides Erwin these co-employees were working on the roof that morning: George Linam, the foreman, Otto Ratajesak, Harold Comisky, Phillip Berry and Richard Swenson. The superintendent, Dewey Forman, was also there part of the time. Ratajesak helped organize and supervise the work and did various jobs. At the time of the accident Comisky was laying form boards south of the poured area. Erwin, Swenson and Berry were carrying boards from the northeast edge of the roof to him.
Plaintiff contends Erwin either slipped on a bulb-tee or tripped on wire and fell through a form board which was yet unprotected by wire or gypsum. The fall occurred about 15 feet south of the poured slab at approximately the middle of the roof. He fell from the 80-foot level onto a housing for a turbine standing 25 feet above the ground.
IV. Plaintiff's contentions as to granting the judgment notwithstanding the verdict are concerned with the duty that Weitz, the general contractor, owed to plaintiff's decedent; whether it was negligent in the performance of its duty; proximate cause; freedom from contributory negligence and assumption of risk.
Conceding that Anning-Johnson was an independent contractor and that generally one who employs this type of contractor is not liable for the latter's torts, plaintiff argues exceptions to the rule applicable here include retained control, positive responsibility, unreasonable risk and special danger in work and duty to invitee. He maintains there is substantial evidence of existence of each of these exceptions here which would permit a jury to find there was a duty owed by defendant to decedent so as to make it liable.
In considering whether defendant's motion for judgment notwithstanding the verdict should have been sustained, we view the evidence in the light most favorable to plaintiff. Davidson v. Cooney, Iowa, 147 N.W.2d 819, filed January 10, 1967.
In support of the first exception plaintiff relies on Weitz's retained control over the safety aspects of the entire job including the roof deck as evidenced by article 12 of the written contract with the light company and defendant's actual assumption of this control.
Article 12 (exhibit 2) provided in part as follows:
"The contractor shall take all necessary precautions for the safety of employees on the work, and shall comply with all applicable provisions of federal, state, and municipal safety laws and building codes to prevent accidents or injury to persons on, about or adjacent to the premises where the work is being performed. He shall erect and properly maintain at all times, as required by the conditions and progress of the work, all necessary safeguards for the protection of workmen and the public and shall post danger signs warning against the hazards created by such features of construction as protruding nails, hod hoists, well holes, elevator hatchways, scaffolding, window openings, stairways and falling materials, and he shall designate a responsible member of his organization on the work, whose duty shall be the prevention of accidents. The name and position of the person so designated shall be reported to the architect by the contractor" (emphasis supplied).
*829 Plaintiff contends defendant thus had specific safety responsibilities in connection with the roof which necessarily included the duty to control Anning-Johnson so far as safety of the workmen was concerned; that this duty was a positive responsibility and not delegable.
In maintaining defendant assumed control in fact over safety procedures, plaintiff refers to the testimony of John Lusk, defendant's job superintendent, who described the building addition as "a hard hat job * * * which means you are not allowed in the working area without a hard hat on." He testified, "Anyone who came on the job, to my knowledge, didn't go out without a hard hat on. * * * The hard hat order that I put into effect applied to all personnel coming on the job, including Anning-Johnson personnel. * * * If I had found a situation that I thought was too dangerous I would have called their attention to it * * * Anning-Johnson's superintendent."
George Linam, labor foreman for Anning-Johnson, testified remembering "they made us wear hard hats." Comisky also testified Weitz had a safety inspector and "we were told that he would be around and to wear our hard hats at all times when we were on the job." Comisky made a written report to Weitz's safety inspector of what he saw with reference to the accident, as did the other men. Otto Ratajesak testified there was some planking on the roof deck when Erwin was killed but it had brick and material all over it. As stated, Anning-Johnson did not furnish this planking. It was there when the crew started working on the roof.
V. Defendant contends plaintiff attempted to reach one of the prime contractors through the doctrine of respondeat superior.
Plaintiff argues the law recognizes the employer may retain a limited controlinsufficient to create a master-servant relationship, yet sufficient to charge the employer with responsibility if he fails to exercise the retained control with reasonable care; the general contractor is liable for his own negligence in failing to exercise the retained control, rather than being liable under the doctrine of respondeat superior; the concept of liability for retained control, even though the control is less than needed to establish a master-servant relationship, is recognized by the cases.
Plaintiff cites Restatement, Second, Torts, § 414, which provides:
"One who entrusts work to an independent contractor, but who retains the control of any part of the work, is subject to liability for physical harm to others for whose safety the employer owes a duty to exercise reasonable care, which is caused by his failure to exercise his control with reasonable care."
In comment "a" under this section it is stated:
"If the employer of an independent contractor retains control over the operative detail of doing any part of the work, he is subject to liability for the negligence of the employees of the contractor engaged therein, under the rules of that part of the law of Agency which deals with the relation of master and servant. The employer may, however, retain a control less than that which is necessary to subject him to liability as master. He may retain only the power to direct the order in which the work shall be done, or to forbid its being done in a manner likely to be dangerous to himself or others. Such a supervisory control may not subject him to liability under the principles of Agency, but he may be liable under the rule stated in this section unless he exercises his supervisory control with reasonable care so as to prevent the work which he has ordered to be done from causing injury to others."
This section and comment "a" are set forth and approved in Trent v. Atlantic City Electric Co. (1964, 3 Cir.N.J.), 334 F.2d 847, 858-859. See also Thill v. Modern Erecting Company, 272 Minn. 217, 136 N.W.2d 677, 684.
*830 We agree that the general contractor may be liable for his own negligence in failing to exercise the retained control, and this liability is not under the doctrine of respondeat superior.
Plaintiff also cites in support of his position Hayes v. Philadelphia Transportation Company (1963, 3 Cir.Pa.), 312 F.2d 522, 524; Blount Brothers Construction Company v. Rose, 274 Ala. 429, 149 So. 2d 821, 830, and citations; Bittker v. Groves, 291 Mich. 40, 288 N.W. 327, 329; Spinozzi, etc. v. E. J. Lavino and Company (1957, 3 Cir.Pa.), 243 F.2d 80, 82.
In Blount Brothers, supra, the general contractor contracted with the United States to erect a building. The written contract required it to take precaution for the safety of employees and other persons. Blount Brothers subcontracted the plumbing work to Nichols Plumbing and Heating Company. Rose, an employee of the subcontractor, fell to his death from a scaffolding. The court held "* * * the provisions of appellant's contract with the government, so far as they imposed upon defendant the duty to furnish safety devices for the project, were for the benefit of Mr. Rose and his fellow workers on this project, and this action will lie so far as it arises out of the breach of this contract. Plaintiffs could sue in tort for damages arising out of the alleged breach. The contract and the law imposed the duty on appellant to provide a reasonably safe place for Mr. Rose and his fellow workers to work on this project" (citing cases).
In Spinozzi, supra, an independent contractor agreed to perform certain excavation work for the owner. Plaintiff's decedent was an employee of the contractor under its exclusive supervision and control. Death resulted from a failure to place shoring in the trench where decedent was working. There was evidence the owner's field engineer was present at the job site much of the time and he and the independent contractor had discussed safety the day before the accident. The court said:
"It is the general rule that the employer of an independent contractor is not responsible for the misconduct of the contractor while the latter is performing under the terms of the contract (citing cases). * * since the employer does not control the work being performed, he should not be liable for the harm resulting from the substandard performance of the independent contractor. Following this line of reasoning, it is apparent that where the employer has retained some element of control of the job, he should be responsible for the harmful consequences of its performance as a concomitant of the control retained. The Pennsylvania courts have recognized that the employer should be liable where he has retained control over some part of the work, or so interfered with the performance of the job as to have assumed control, and his failure to exercise that control with reasonable care causes harm to others (citing cases). It is the jury's function to determine whether the employer retained control so as to make him liable (citing cases)."
In Bittker, supra, the Michigan Supreme Court stated the "* * * rule has many exceptions and this case, under the evidence, comes within the one wherein the principal, by retention or exercise, or even quasi supervision or control, remains responsible. * * * Supervision, in fact exercised, is equivalent to supervision expressly retained in fixing liability of the principal contractor."
VI. Plaintiff offered in evidence certain interrogatories propounded to defendant and answered by its vice president and treasurer. Interrogatory one asked what precaution defendant had taken or caused to be taken for the safety of Erwin in connection with construction of the roof. The answer was:
"It is impossible to state in detail all of the precautions observed in the construction of the building in question for the safety of everyone who came near it. Safety was constantly emphasized. Weekly safety meeting were held. Signs were posted requiring *831 the wearing of hard hats. Personnel in charge of and most familiar with the various aspects of the construction process were charged with the duty of recognizing and correcting conditions and observing safety precautions peculiar to their particular operations."
Plaintiff asserts defendant did not state it owed no duty to Erwin and that the foregoing answer shows the practical construction placed upon the contract by the parties and that Weitz in fact assumed control over safety procedures of Anning-Johnson.
VII. In arguing his second exception, positive responsibility, plaintiff asserts defendant Weitz was charged under the written contract with a positive responsibility for the safety of the workmen and this responsibility cannot be delegated.
In Division I of its motion defendant urged it had delegated the safety responsibility in connection with the roof construction to Anning-Johnson, thereby relieving itself from responsibility. To sustain this claim defendant refers to article 37 of exhibit 2 which provides:
"Relations of contractor and subcontractor. The contractor agrees to bind every subcontractor and every subcontractor agrees to be bound by the terms of the agreement, the general conditions, the drawings and specifications as far as applicable to his work, including the following provisions of this article, unless specifically noted to the contrary in a subcontract approved in writing as adequate by the owner or architect.
"This does not apply to minor subcontracts.
"The subcontractor agrees
"(a) To be bound to the contractor by the terms of the agreement, general conditions, drawings and specifications and to assume toward him all the obligations and responsibilities that he, by those documents, assumes toward the owner."
Defendant argues this was an express agreement between all parties to the contract that it was the duty of the subcontractor to step into the shoes of the general contractor and to assume all "obligations and responsibilities" on the subcontracted work that the general contractor had assumed towards the owner. This included the duty of the subcontractor to take all necessary precautions for the safety of employees on the work and designate a responsible member of the subcontractor's organization whose duty would be the prevention of accidents, as required by article 12 of the contract between the light company and defendant.
Plaintiff, on the other hand, contends this article requires Weitz to bind Anning-Johnson to the terms of the general conditions, but in no way purports to relieve the general contractor from the responsibility taken. He contends article 36 specifically states the contractor agrees he is as fully responsible to the owner for the acts and omissions of his subcontractor as he is for the acts and omissions of persons directly employed by him. The only writing between Weitz and Anning-Johnson is exhibit "B", a part of exhibit 2, designated "purchase order" which provides:
"In connection with your work, you are to bear the same responsibility to us as we do to the architect and owner as regards to the plans and specifications."
Plaintiff contends Weitz bound Anning-Johnson to the plans and specifications but not to the general conditions.
Where public interest or some statutory prohibition is not involved, generally contracts exempting parties from liability for their own negligence are not against public policy. Sears, Roebuck and Co., Inc. v. Poling, 248 Iowa 582, 587, 81 N.W.2d 462, 465, and citations; Weik v. Ace Rents, Incorporated, 249 Iowa 510, 514, 87 N.W.2d 314, 317; Bashford v. Slater, 250 Iowa 857, 865, 96 N.W.2d 904, 909. However, "(o)ne who owes, and is personally bound to perform, an absolute and positive duty to the public or an individual cannot escape the *832 responsibility of seeing that duty performed by delegating it to an independent contractor, and will be liable for injuries resulting from the contractor's negligence in the performance thereof, whether the duty is imposed by law or by contract * * *." 57 C.J.S. Master and Servant § 591. In support of this statement see State Farm Mutual Automobile Ins. Co. v. Dodd, 276 Ala. 410, 162 So. 2d 621, 626; Jack Cooper Transport Company v. Griffin (Okl.), 356 P.2d 748, 754, and citations; Mills v. Krauss (Fla.App.), 114 So. 2d 817, 819; Capitol Chevrolet Co. v. Lawrence Warehouse Co. (1955, 9 Cir.Cal.), 227 F.2d 169, 173; Elliott Consolidated School District v. Busboom (D.C.S.D.Iowa W.D.), 227 F. Supp. 858, 862.
"In some circumstances duties may devolve upon an employer which he cannot delegate to another, and in such cases the employer is liable for breach or nonperformance of such duties even though he employs an independent contractor to do the work." Mills v. Krauss, supra, citing 27 Am.Jur., Independent Contractors, § 48.
"Where one person owes another a contractual duty to act, the law imposes upon the person owing that duty the further duty of acting with due care in the performance of his contract so as not to injure the contractee's person or property. This duty is nondelegable. See note, Restatement, Torts, page 1101 [now "Introductory Note", topic I, following comment to section 409, Restatement, Second, Torts]. That is, the performance of the contract may be delegated to another, but this delegation does not relieve the contractor of the duty to act, or of his duty to act with due care." Pacific Fire Ins. Co. v. Kenny Boiler & Mfg. Co., 201 Minn. 500, 277 N.W. 226, 228.
It is our conclusion defendant assumed a duty under its contract with the light company for the safety of the workmen and this responsibility cannot be delegated even though Weitz had employed an independent contractor to do the actual work.
VIII. Plaintiff contends the two exceptions we have thus far discussed involve a duty assumed by contract, and two preliminary matters to be considered are the right to recover in tort for breach of contract and the right of plaintiff's decedent, a subcontractor's employee, to benefit from the contract between the general contractor and the owner.
It appears to be well settled in Iowa that where a contract imposes a duty upon a person, the neglect of that duty is a tort, and an action ex delicto will lie. "`A tort may be dependent upon, or independent of, contract. If a contract imposes a legal duty upon a person the neglect of that duty is a tort founded on contract; so that an action ex contractu for the breach of the contract, or an action ex delicto for the breach of the duty, may be brought at the option of the plaintiff.'" Matthys v. Donelson, 179 Iowa 1111, 1116, 160 N.W. 944, 946; Kunzman v. Cherokee Silo Co., 253 Iowa 885, 891, 114 N.W.2d 534, 537, 95 A.L.R. 2d 673.
Since the tort sued upon is the neglect of a duty undertaken in a contract to which plaintiff's decedent is not a party, it is necessary in order for plaintiff to acquire any rights to show his decedent was a donee or creditor beneficiary of the contract. Both donee and creditor beneficiaries can maintain actions. Iowa Home Mutual Cas. Co. v. Farmers Mutual Hail Ins. Co., 247 Iowa 183, 187, 73 N.W.2d 22, 24-25, and citations; Reeves v. Better Taste Popcorn Co., 246 Iowa 508, 516-517, 66 N.W.2d 853, 858, and citations; In re Estate of Lindsey, 254 Iowa 699, 710, 118 N.W.2d 598, 604-605. For definitions of creditor, donee and incidental beneficiaries, see Iowa Power and Light Company v. Abild Construction Company, Iowa, 144 N.W.2d 303, 312; Olney v. Hutt, 251 Iowa 1379, 1386, 105 N.W.2d 515, 519-520.
Neither consideration from the beneficiary nor knowledge of the contract by the beneficiary is required. Olney v. *833 Hutt, supra, 251 Iowa at 1384, 105 N.W.2d at 518. Nor is it necessary that the third party be identified or identifiable when the contract is made. Iowa Home Mutual Cas. Co. v. Farmers Mutual Hail Ins. Co., supra, 247 Iowa at 187, 73 N.W.2d at 25.
The decedent though not a party to the contract was nevertheless a member of a class for whose benefit the contract was made. In re Disinterment of Tow, 243 Iowa 695, 698, 53 N.W.2d 283, 285; Blount Brothers Construction Company v. Rose, supra.
"A distinction should be drawn between an intent to create a `right' in a third party and an intent that a performance beneficial to him should be rendered." 4 Corbin on Contracts, § 777.
We do not agree with defendant's contention that the doctrine of third party beneficiaries does not apply and we hold that decedent's representative can maintain an action for the negligent failure to perform a duty assumed by contract.
IX. Plaintiff contends another exception to the general rule of nonliability for acts of an independent contractor applies where the work is likely to create a particular risk of physical harm unless special precautions are taken or where the work involves a special danger inherent in it.
He cites three sections of Restatement, Second, Torts, as bearing on this exception. While the sections overlap, we set them out.
"§ 413. Duty to Provide for Taking of Precautions Against Dangers Involved in Work Entrusted to Contractor.
"One who employs an independent contractor to do work which the employer should recognize as likely to create, during its progress, a peculiar unreasonable risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the absence of such precautions if the employer
"(a) fails to provide in the contract that the contractor shall take such precautions, or
"(b) fails to exercise reasonable care to provide in some other manner for the taking of such precautions."
"§ 416. Work Dangerous in Absence of Special Precautions.
"One who employs an independent contractor to do work which the employer should recognize as likely to create during its progress a peculiar risk of physical harm to others unless special precautions are taken, is subject to liability for physical harm caused to them by the failure of the contractor to exercise reasonable care to take such precautions, even though the employer has provided for such precautions in the contract or otherwise."
"§ 427. Negligence as to Danger Inherent in the Work.
"One who employs an independent contractor to do work involving a special danger to others which the employer knows or has reason to know to be inherent in or normal to the work, or which he contemplates or has reason to contemplate when making the contract, is subject to liability for physical harm caused to such others by the contractor's failure to take reasonable precautions against such danger." See comments "b" and "c" to this section.
Comment "e" to section 413 states:
"The fact that the contract under which the work is done provides that the contractor shall take the necessary special precautions does not necessarily relieve the employer from liability, since he may be liable under the rule stated in section 416."
Comment "c" under section 416 provides in part:
"This section deals with the liability of one who employs a contractor to do such work, even though he stipulates in his contract or in a contract with another independent contractor that the precautions *834 shall be taken, for bodily harm caused by the negligent failure of either contractor to take such precautions. In such case the contractor who is employed to take the precautions is under a duty to indemnify his employer for any liability which the contractor's negligence in failure to take reasonably adequate precautions may bring upon him. However, the fact that the contract contains express stipulations for the taking of adequate precautions and that the contractor agrees to assume all liability for harm caused by his failure to do so, does not relieve his employer from the liability stated in this section" (emphasis supplied).
Sections 413 and 416 should be construed together though the risks described in these two sections are worded differently. ("A peculiar unreasonable risk of physical harm to others" as opposed to "peculiar risk of physical harm to others".) A change in § 416 should also be noted. The old rule said the work must be such as "necessarily requiring * * * a peculiar risk of bodily harm to others unless special precautions are taken," whereas the new rule only requires the work be such as "likely to create * * * a peculiar risk of harm to others unless special precautions are taken."
The employees of an independent contractor come within the word "others" in sections 413, 416 and 427 of the Restatement. Woolen v. Areojet General Corporation, 57 Cal. 2d 407, 20 Cal. Rptr. 12, 369 P.2d 708, 711; Mallory v. Louisiana Pure Ice & Supply Co., 320 Mo. 95, 6 S.W.2d 617, 623-627; International Harvester Co. v. Sartain, 32 Tenn.App. 425, 222 S.W.2d 854, 865-868.
We hold the duties outlined in the quoted sections of the Restatement are owed by a principal contractor to workmen of an independent contractor on the job.
See 57 C.J.S. Master and Servant § 590, as supporting this exception to the general rule.
X. Plaintiff's last exception to the general rule is concerned with the duty owed an invitee. An employee of a subcontractor doing work contracted to be done by it is an invitee of the general contractor. Revels v. Southern California Edison Company, 113 Cal. App. 2d 673, 248 P.2d 986, 989; Ferrel v. Safway Steel Scaffolds, 57 Cal. 2d 651, 21 Cal. Rptr. 575, 371 P.2d 311, 314; Fisher Construction Company v. Riggs (Tex.Civ.App.) 320 S.W.2d 200, 205-206; Raich v. Aldon Construction Co., 129 Cal. App. 2d 278, 276 P.2d 822, 827. We have recently passed upon the duty owed by a possessor of land to an invitee in Hanson v. Town & Country Shopping Center, Inc., Iowa, 144 N.W.2d 870, and what was said there need not be repeated here.
Defendant contends a general contractor is not obliged to see that a subcontractor maintains a safe place for employees with respect to the changing conditions created by the subcontractor and his employees as construction work progresses; that the accident arose not because of any latent or hidden defect in the premises but directly from the mode of doing the work; there is no allegation of active negligence on the part of Weitz. But the problem here is whether there is substantial evidence of the existence of certain exceptions to the general rule from which a jury would be justified in finding defendant, a general contractor, owed a duty to use ordinary care to provide a safe place for the subcontractor's employees to work.
It seems clear the exceptions asserted by plaintiff to the general rule are recognized by the authorities. We conclude there is substantial evidence of the existence of each of them and that a jury would be justified in finding defendant owed a duty toward decedent and would be liable for a negligent exercise of it.
XI. Our next problem is whether a jury could find defendant was negligent in the exercise of this duty.
*835 Generally, questions of negligence, contributory negligence and proximate cause are for the jury; it is only in exceptional cases that they may be decided as a matter of law. Rule 344(f) 10, R.C.P.
From the facts narrated in Division III, supra, a jury could find defendant was negligent in not providing additional planking as scaffolding for the workers to walk on as they carried form boards to the area beyond the poured surface where Comisky was working and in failing to require the wire mesh strips which would support a man's weight to be placed over the boards already in place as soon as a 3½ or 4 foot space had been made available. Further, a jury could find there was a space at least 4 to 6 feet beyond the poured surface that could have been covered with gypsum as a safety precaution, especially in light of defendant's requiring the men on the top floor of the structure to wear hard hats.
As stated, the area through which Erwin fell was unprotected by wire, gypsum, planking or scaffolding.
Defendant had either furnished planking for the north end of the deck for use in storing materials and to serve as a platform to walk on, or at least permitted it to remain on the deck after the bricklayers had finished with it. Plaintiff's evidence detailed how the process of roof construction was carried on.
We think there is substantial evidence from which a jury could find defendant negligently exercised its duty to use ordinary care to provide a safe place for the subcontractor's employees to work. The trial court was correct in the first instance in submitting the stated specifications to the jury.
XII. The issue of proximate cause was for the jury. "In several recent decisions we have approved this from Restatement, Second, Torts, section 431: `The actor's negligent conduct is a legal cause of harm to another if (a) his conduct is a substantial factor in bringing about the harm, and (b) there is no rule of law relieving the actor from liability because of the manner in which his negligence has resulted in the harm' (citing cases).
"Nor will the fact that some other cause operated with defendant's negligence to produce the injury relieve the defendant if the injurious result is traceable in some material degree to his want of due care (citing cases).
"Of course there may be more than one proximate cause of an injury." Davidson v. Cooney, supra.
XIII. It is only the exceptional case in which the issue of freedom from contributory negligence should not be submitted to the juryonly where such negligence is so palpable, flagrant and manifest that reasonable minds may fairly reach no other conclusion; if there is any evidence tending to establish decedent's freedom from contributory negligence, the question is for the jury and doubts should be resolved in favor of such submission. Goman v. Benedik, 253 Iowa 719, 721, 113 N.W.2d 738, 739, and citations.
We are satisfied the trial court correctly submitted the contributory negligence issue to the jury. This is not the exceptional case in which reasonable minds could fairly reach no other conclusion than that decedent was contributorily negligent.
XIV. Plaintiff's final assigned error as to the judgment notwithstanding concerns the doctrine of assumption of risk. It is an affirmative defense and the burden of pleading and proving it was on defendant. Frederick v. Goff, 251 Iowa 290, 296, 100 N.W.2d 624, 628; Thornbury v. Maley, 242 Iowa 70, 78, 45 N.W.2d 576, 581. Here the doctrine was not pleaded and is not available. The trial court erred in sustaining defendant's motion on this ground.
*836 XV. For the reasons set forth, the sustaining of defendant's motion for judgment notwithstanding and entering judgment for defendant was error, and the first of the two main questions presented on this appeal, Division I, supra, is answered in the affirmative, the second need not be determined.
XVI. Because it sustained Division I of defendant's motion, the trial court did not rule on Divisions II, III and IV thereof, observing that "such alternative motions are overruled by operation of law subject to review by the supreme court in the event plaintiff should appeal and the alternative motions are argued."
Because of our holding as to Division I of the motion, it is necessary that we consider the remaining divisions thereof.
Division II is in the alternative to Division I and asks that a new trial be granted because of alleged erroneous instructions to the jury. Division III, in the alternative, also asks a new trial because certain instructions defendant requested were not given. Division IV, also in the alternative, asks the same relief on the claimed excessiveness of the verdict.
XVII. In support of the assigned errors in giving some of the instructions defendant argues it was the subcontractor's responsibility, not defendant's, to furnish a reasonably safe place for the subcontractor's employees to work, to supervise and provide for the safety of all their workmen against dangers inherent in and growing out of the subcontractor's work; it was not defendant's duty to furnish material for the subcontractor's work or to guard its employees from dangers in carrying out orders of their immediate superiors.
What is said in the prior divisions hereof sufficiently answers this argument.
XVIII. Defendant's fifth assignment is directed to the court's ninth instruction on contributory negligence. After referring to a previous definition of the term and placing the burden on plaintiff to establish freedom therefrom by a preponderance of the evidence, the instruction continued:
"In considering the contributory negligence of plaintiff's decedent, if any, you may take into consideration his age, experience, and general situation in life. You should charge him only with that degree of care that would be expected of an ordinary person of that age and experience."
We find no fault with the quoted statement in the light of the whole instruction. 65A C.J.S. Negligence § 146; 38 Am.Jur., Negligence, § 204; Lehmuth v. Long Beach Unified School District, 53 Cal. 2d 544, 2 Cal. Rptr. 279, 348 P.2d 887, 894; Satariano v. Sleight, 54 Cal. App. 2d 278, 129 P.2d 35, 38-39. As tending to support our position see also Hill v. City of Glenwood, 124 Iowa 479, 482, 100 N.W. 522, 523.
Of course, decedent's age, experience and general situation in life are but some of the matters the jury may properly consider in deciding the issue of freedom from contributory negligence.
XIX. We find no reversible error in failure to give defendant's requested instructions. The substance of many of the requests are embodied in the instructions given. Some indicate theories rejected in Divisions V, VII and IX hereof and were properly denied. The effect of failure to give requested instruction seven is answered by Mallinger v. Brussow, 252 Iowa 54, 58-59, 105 N.W.2d 626, 628-629. Other requests appear to overlook the fact that passive negligence may be actionable.
XX. Division IV of defendant's motion alleges the verdict is excessive beyond reason, contrary to the instructions and not supported by the evidence.
The fair and reasonable value of the funeral expenses was $1197.27. Erwin's life expectancy at the time of death was 52.19 years. He was not killed immediately upon his fall. He was taken by ambulance *837 to the Marshalltown hospital and died on the way to Iowa City about two and a half hours after the fall. There was evidence of Erwin's apparent pain and suffering during this time.
During his four years in a Marshalltown high school Erwin's grade average was 91.1, sixth in his class, graduating with honors and a mathematics award. He participated in speech, drama, music, football and basketball, was president of his senior class and captain of the football team. He had an I.Q. of 115, wanted to be a doctor of veterinary medicine and had been accepted at Iowa State University to begin study in the fall.
Erwin's father, age 54, has lived in Marshalltown virtually all his life, his work has been wholesale grocery selling, calling on retail groceries, hotels and restaurants. He worked for one company 25 years and another five years.
Erwin's mother is a registered nurse and at the time of trial was the head nurse in the pediatric department of the Marshalltown hospital.
Erwin was described as physically strong, in perfect health, even-tempered, quiet, reserved, friendly, obedient and dependable. He was further described by one witness as forthright, pleasant and socially well adjusted. His uncle described him as a boy of excellent judgment, settled for his age, a diligent worker, quite an athlete and possessing a grown-up attitude. When younger he carried newspapers, worked part time in the neighborhood grocery, during the summer on the farm and in a furniture store where he earned $1.50 an hour, saved his money and asked for no allowance from his parents. His father described him as having an adult mind with adult thinking. "He thought ahead at all times. He wanted to be something." He generally bought his own clothing out of the money he made.
Deducting from the amount of the award interest on the reasonable funeral expense for such time as it was prematurely incurred, not to exceed the cost as an allowable item and reducing further the resulting amount by such sum as will fairly and reasonably compensate for the pain and suffering during the two and one-half hours decedent survived the accident, the verdict awarded for present value of the damages to the decedent's estate would be approximately $67,500.
It is our conclusion the verdict is clearly above what the record justifies. Without repeating what was said in Tedrow v. Fort Des Moines Community Services, Inc., 254 Iowa 193, 201-204, 117 N.W.2d 62, 66-68, we refer to and approve it.
Unless a remittitur is filed within 30 days from the filing of this opinion of all the verdict in excess of $50,000 with interest thereon and costs, a new trial will be granted. If such remittitur is so filed, judgment on reduced amount shall be entered.
Reversed and remanded.
All Justices concur except BECKER, J., who concurs specially, and STUART, J., who dissents.
BECKER, Justice.
I concur in all divisions except Division XX. My views on ordering remittiturs are set forth in a dissent in Hurtig v. Bjork, 258 Iowa 155, 138 N.W.2d 62.
STUART, Justice (dissenting).
I am reluctant to call the following comments a dissent from the well written and amply supported majority opinion. I would not be justified in requesting additional time to write a full dissent in view of the lack of support for my position. Since I am unable to agree with the result reached here I feel the reasons for my dissent should be stated briefly.
The majority opinion recognizes the general rule that one who employs an independent contractor is ordinarily not liable for *838 the latter's torts and then holds the facts here created a jury question as to the applicability of all four exceptions to the general rule urged by plaintiff. In making these comments I will assume the exceptions are all valid. Even so, I do not believe any of them are applicable to these facts. In my opinion, to so hold, leaves little, if any, room for the application of the general rule to construction accidents.
The opinion says: "Plaintiff contends Erwin either slipped on a bulb-tee or tripped on wire and fell through a form which was yet unprotected by wire or gypsum. The fall occurred about 15 feet south of the paved slab at approximately the middle of the roof." It seems to me that any negligence which caused a fall as claimed by plaintiff must necessarily have been connected with the subcontractor's job on which the deceased was working. The opinion does not refer to evidence tending to show defendant retained any control over the operative detail of subcontractor's work.
Reliance is placed on Article 12 of the contract between the owner and principal contractor. It is claimed this shows a retention of control over safety matters. The terms are very general and it appears to me that rather than being a retention of control of safety procedures, it is actually a delegation of responsibility from the owner to the contractor. In the contract with the subcontractor, it agreed "to assume toward (the contractor) all the obligations and responsibilities that he, * * * assumes toward the owner".
In my opinion this amounted to a delegation of control of safety procedures connected with the subcontract to the subcontractor. I think this was not only as proper as delegating the responsibility from the owner to the principal contractor but advisable. The responsibility for safety measures in the performance of the job should rest upon those most familiar with the dangers and hazards of the work. The general contractor might not have sufficient knowledge concerning details of the operation to prescribe adequate safety rules. I could see where a much more dangerous situation could develop if a general contractor tried to retain control over the details of a subcontractor's work.
The claimed assumption of control over safety measures by the general contractor related to safety procedures for the whole job. Hard hats were required. Dangerous situations were called to the subcontractor's attention. There was no evidence defendant ever exercised control over the method of doing a job or interfered with the subcontractor's procedures.
As I believe the control of safety precautions connected with the details of performing the work under the subcontract were delegable and had been delegated here, there was no contractual obligation on which to base a third party beneficiary argument.
The holding that the general contractor is liable here under the exception to the general rule that the job was such that it was "likely to create a peculiar risk unless special precautions are taken" places the whole construction industry under a responsibility which would best be placed on those actually employing persons to do the work. Construction work, alone, should not be held to create such a peculiar risk.
Even if an employee of a subcontractor is a business invitee, it should not be a basis for liability here. Plaintiffs' own theory of the accident does not attempt to prove there was an unsafe place to work except such condition as was created by the very work in which deceased was engaged. There was no claim of any hidden trap or defect. Conditions were changing all the time, partly because of the work performed by deceased. There was no proof of superior knowledge on the part of defendant or any reasons to believe defendant would be more familiar with these temporary conditions than deceased.
*839 There was a suggestion that all the planks on the roof were in use for other purposes. There was no proof additional planks would have been used for walkways had they been available.
I believe the trial court was right and should be affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580858/ | 378 Mich. 538 (1967)
147 N.W.2d 66
PEOPLE
v.
MALLORY.
Calendar No. 3, Docket No. 51,212.
Supreme Court of Michigan.
Decided January 4, 1967.
Frank J. Kelley, Attorney General, and Robert A. Derengoski, Solicitor General, Samuel H. Olsen, Prosecuting Attorney, Samuel J. Torina, Chief Appellate Lawyer, and James E. Lacey, Assistant Prosecuting Attorney, for the people.
Goodman, Crockett, Eden, Robb & Philo (Rolland R. O'Hare and Sheldon M. Meizlish, of counsel), for defendant.
Amicus Curiae:
Civil Liberties Committee of the State Bar of Michigan, by Irving Tukel.
*548 DETHMERS, J.
This is an appeal, upon leave granted, from Court of Appeals' denial of application for delayed appeal from an order of the recorder's court of the city of Detroit denying defendant's motion for appointment of appellate counsel and free transcript for appeal purposes.
On May 11, 1964, defendant was convicted, by a judge sitting without a jury, in the recorder's court of the city of Detroit, of the misdemeanor of receiving and concealing stolen property under the value of $100.[*] This is an offense cognizable by a justice of the peace. The maximum permissible sentence is 90 days in jail or $100 fine or both. He was sentenced to 90 days in the Detroit house of correction and served the sentence.
It is urged by the people that because defendant completed service of his sentence this appeal should be dismissed on the ground that the case has become moot. For this the following authorities are cited: People v. Leavitt, 41 Mich. 470; City of Ishpeming v. Maroney, 49 Mich. 226; Pittsburgh Plate Glass Co. v. Charles Klein Co., 177 Mich. 399; Howe v. Doyle, 187 Mich. 655; Thomas v. Montcalm Circuit Judge, 228 Mich. 44; Sullivan v. Michigan State Board of Dentistry, 268 Mich. 427; Horowitz v. Rott, 235 Mich. 369; People v. Pyrros, 323 Mich. 329; Johnson v. City of Muskegon Heights, 330 Mich. 631; McCarthy v. Wayne Circuit Judge, 294 Mich. 368.
At the time of the alleged commission of the misdemeanor and his conviction thereof, defendant was on parole from a previous sentence on a 1962 felony conviction. After the May 11, 1964, misdemeanor conviction, defendant was found guilty by the parole board of parole violation and, after service of his *549 90-day misdemeanor sentence, was remanded to State prison as a parole violator and is still there as provided by law, serving the remainder of his sentence for the 1962 felony conviction.
There is question as to how the matter of the reasons for his parole revocation, set forth in defendant's appendix, came into the record in this case. However, the people's appendix contains material which equally goes into the matter. From all that appears in the appendices it is evident that either defendant's misdemeanor conviction automatically brought about a finding by the parole board of parole violation or that, at least, that conviction was an element and factor in the parole violations charged against defendant and considered by the board in making its finding of parole violation. Accordingly, we consider the above cases cited by the people with respect to mootness inapt. Defendant's present incarceration may well be considered a consequence, in part at least, of this misdemeanor conviction. More to the point is United States v. Morgan, 346 U.S. 502 (74 S. Ct. 247, 98 L ed 248), in which the United States Supreme Court said (pp 512, 513):
"Although the term has been served, the results of the conviction may persist. Subsequent convictions may carry heavier penalties. * * * As the power to remedy an invalid sentence exists, * * * respondent is entitled to an opportunity to attempt to show that this conviction was invalid."
See, also, Jones v. Cunningham, 371 U.S. 236 (83 S. Ct. 373, 9 L ed 2d 285); United States, ex rel. Harton, v. Wilkins (CA 2), 342 F2d 529; Williams v. United States (CA 7), 332 F2d 36; United States v. Cariola (CA 3), 323 F2d 180; Williams v. United States (CA 7), 310 F2d 696; United States v. Moore (CA 7), 166 F2d 102; United States v. Steese (CA *550 3), 144 F2d 439; United States, ex rel. Oddo, v. Fay (DC, NY), 236 F Supp 242; Janiec v. State of New Jersey, 85 NJ Super 68 (203 A2d 727); Bojinoff v. People, 299 NY 145 (85 NE2d 909). Because of the parole revocation and present resultant imprisonment, we cannot hold this case moot.
Defendant was not represented by counsel at the misdemeanor trial. Since trial defendant has said that he did not waive his right to trial by jury and the record does not clearly disclose that he did. Other claims of reversible error with respect to the trial and conviction are suggested. None of these, however, are before us for determination now. Rather, it is the subsequent occurrences which are the subject of this appeal. We turn now to these.
Defendant's brief states the question involved in this appeal as follows:
"Is an indigent misdemeanant entitled as a matter of right to have counsel appointed to appeal a misdemeanor conviction?"
Despite defendant's wording of this question, it will be noted that there is involved not only appointment of appellate counsel but also furnishing to defendant of a free copy of portions of transcript and record essential to preparation of postconviction motions and appeal.
In Griffin v. Illinois, 351 U.S. 12 (76 S. Ct. 585, 100 L ed 891, 55 ALR2d 1055), indigent defendants were convicted of armed robbery, which was undoubtedly, as in Michigan, a felony. It was held that the due process and equal protection clauses of the 14th Amendment to the Federal Constitution required furnishing defendants, at public expense, with the portions of the transcript of trial necessary for taking and presenting an appeal.
In Gideon v. Wainwright, 372 U.S. 335 (83 S. Ct. 792, 9 L ed 2d 799, 93 ALR2d 733), an indigent *551 defendant convicted of a noncapital felony was denied appointment of trial counsel. The court held that defendant's trial and conviction without being accorded the fundamental right of assistance of counsel violated the 14th Amendment.
In Douglas v. California, 372 U.S. 353 (83 S. Ct. 814, 9 L ed 2d 811), indigent defendants were convicted of 13 felonies. Denial of their requests for appointment of counsel to prosecute an appeal was held to amount to discrimination between the rich and the poor, in violation of the 14th Amendment.
In Patterson v. Warden, Maryland Penitentiary, 372 U.S. 776 (83 S. Ct. 1103, 10 L ed 2d 137), defendant had been denied court-appointed counsel because the Maryland statute provided for this only in capital or "serious" cases and the trial court said this one was neither. He was convicted of carrying concealed weapons and sentenced to two years' imprisonment. The United States Supreme Court vacated judgment and remanded for reconsideration in the light of Gideon v. Wainwright, supra.
Similar are the cases of Lane v. Brown, 372 U.S. 477 (83 S. Ct. 768, 9 L ed 2d 892), involving a conviction for murder, and Draper v. Washington, 372 U.S. 487 (83 S. Ct. 774, 9 L ed 2d 899), in which the indigent defendants were convicted of robbery.
These United States Supreme Court decisions, all involving felonies, may not necessarily be controlling of the question in the instant case relating to a misdemeanor.
The Federal criminal justice act, 18 USCA, § 3006A(b), provides that "In every criminal case in which the defendant is charged with a felony or a misdemeanor, other than a petty offense, and appears without counsel" (emphasis supplied) defendant shall be advised by the commissioner or *552 court that counsel will be appointed to represent him if he is financially unable to obtain counsel.
In the opinions of certain Federal courts of appeal cases language appears indicating that statutory denomination of the offense as a felony or fixing of a serious penalty or the offense being a serious one are not prerequisites to the constitutional right to counsel at public expense and apprisal of defendant of his rights thereto. These do not appear to give heed to the "petty offense" provision of the above Federal statute. For example:
In Evans v. Rives (CA DC), 126 F2d 633, 638, the court of appeals for the District of Columbia said:
"It is further suggested by the District of Columbia that the constitutional guaranty of the right to the assistance of counsel in a criminal case does not apply except in the event of `serious offenses.' No such differentiation is made in the wording of the guaranty itself, and we are cited to no authority, and know of none, making this distinction. The purpose of the guaranty is to give assurance against deprivation of life or liberty except strictly according to law. The petitioner would be as effectively deprived of his liberty by a sentence to a year in jail for the crime of nonsupport of a minor child as by a sentence to a year in jail for any other crime, however serious. And so far as the right to the assistance of counsel is concerned, the Constitution draws no distinction between loss of liberty for a short period and such loss for a long one."
In Harvey v. Mississippi (CA 5), 340 F2d 263, 271, defendant was convicted, on plea of guilty, of the misdemeanor of possession of whiskey and sentenced to a 90-day jail term and to pay $500 fine. The fifth circuit court of appeals, after quoting *553 the above quotation from the Evans v. Rives Case, went on to say:
"While the rule as thus stated has never been expressly extended to misdemeanor charges in State tribunals, it has been argued that such a principle is implicit in the Supreme Court's decision in Gideon v. Wainwright (1963), 372 U.S. 335 (83 S. Ct. 792, 9 L ed 2d 799, 93 ALR2d 733). Be this as it may, the reasoning in Evans along with other recent right-to-counsel decisions persuades us that we should apply that rule in the present case. See Hamilton v. Alabama, supra,[1]White v. State of Maryland, supra.[2] The failure of notice to Harvey of his right to the assistance of counsel invalidated his guilty plea and rendered his conviction and incarceration constitutionally improper. We therefore reverse the judgment of the trial court and remand the case for the entry of judgment ordering the release of the appellant from custody on the present conviction and sentence."
In McDonald v. Moore (CA 5), 353 F2d 106, 110, defendant was convicted, on plea of guilty, of the misdemeanor of possession and sale of intoxicating liquor and sentenced to pay a fine of $250 or serve 6 months in county jail. The court of appeals, fifth circuit, reversed the district court's denial of habeas corpus, and, after again quoting the above language from Evans v. Rives, supra, continued:
"In approving the above quotation this court has, we think, rejected the `serious offense' rule. We also think that Gideon has repudiated the Betts v. Brady[3]ad hoc special circumstance rule of `an appraisal of the totality of facts in a given case.' We are without any authority authorizing the announcement of a petty offense rule. We are not, fortunately, precluded from following precedent. *554 In the Harvey Case the facts were so similar to those in the case before us as to permit, and probably to require that our decision be the same as was there announced. There it was held that the failure to notify the appellant of his right to the assistance of counsel rendered the plea of guilty and the judgment of conviction and sentence constitutionally invalid. We make the same holding as to the appellant here."
Among State court of last resort opinions of similar import are:
State v. Anderson, 96 Ariz 123, 131 (392 P2d 784). In that case defendant was convicted of the misdemeanor of attempting to assist the escape from county jail of a prisoner held on felony charges. Defendant was sentenced to 18 months' imprisonment. He had been denied court-appointed counsel at trial, but was granted appellate counsel. A court rule in that State required appointment of counsel in felony cases. The court said, however, that "Gideon" requires appointment of counsel in cases of "a misdemeanor which falls in the category of a `serious offense,'" and said, further, that this case was a serious one in which the sentence could be up to 2 years' imprisonment.
Bolkovac v. State, 229 Ind 294 (98 NE2d 250). In Indiana the Constitution provides for the right to counsel for accused and since it makes no distinction between felonies and misdemeanors, the court held that the right must apply also to misdemeanors, saying that otherwise the legislature could defeat the constitutional provisions and right to counsel by merely denominating offenses as misdemeanors. In this case the offense was child neglect and the sentence for 180 days. Defendant was not given counsel at trial. Reversed on that account.
*555 People v. Witenski, 15 NY2d 392 (259 NYS2d 413, 207 NE2d 358). Defendants were convicted of stealing apples of a value of about $2 in an orchard. They received a 30-day jail sentence plus fine of $25 which none could pay. Hence, they were required to serve 55 days in jail. Although there was a statutory involvement not present in Michigan, the court held that there was a right to appointed counsel in every criminal case "large or small." Because the justice of the peace, upon their arraignment, only told defendants that they had a right to be represented by counsel but failed to state that they had a right to have counsel appointed for them if they were unable to procure same, the conviction was reversed on that account for violation of "fundamental rights."
Hunter v. State (Okla), 288 P2d 425. Defendant was convicted of drunk driving, a misdemeanor, and fined $125. The court held that defendant had a right to appointed counsel because the State's Constitution, in providing therefor, made no distinction in that regard between felonies and misdemeanors.
State, ex rel. Barth, v. Burke, 24 Wis 2d 82 (128 NW2d 422). Defendant was convicted, on plea of guilty, of 19 counts of issuing worthless checks, all misdemeanors. After defendant told the trial court that he owned certain property, that court determined that he was not indigent and accepted his guilty plea. He was sentenced to 4 years' probation and, upon violation thereof, to 5 years' imprisonment. The appellate court held that the finding of nonindigency was arbitrary and, hence, for failure to appoint or offer to appoint counsel, reversed the conviction with new trial.
Michigan Constitution of 1963, art 1, § 20, provides that, "In every criminal prosecution, the accused shall have the right * * * to have the assistance *556 of counsel for his defense; to have an appeal as a matter of right; and in courts of record, when the trial court so orders, to have such reasonable assistance as may be necessary to perfect and prosecute an appeal."
GCR 1963, 785.4,[4] provides:
"(1) * * * immediately upon sentencing, the court shall advise the defendant in open court that he is entitled as a matter of constitutional right to appellate review of his conviction and that, if defendant is financially unable to provide counsel to perfect such appeal, the court will appoint counsel for him and will furnish counsel with such portions of the trial transcript counsel requires to prepare postconviction motions and to perfect an appeal. * * *
"(2) Delayed Appeal. In all other criminal cases, application for leave to take delayed appeal may be filed pursuant to the provisions of Rule 806. Upon defendant's request, if defendant is indigent, the trial court in which defendant was convicted shall appoint counsel for him and shall furnish such portions of the trial transcript counsel so appointed requires to prepare delayed motions for postconviction proceedings in the trial court and to prepare an application for leave to take delayed appeal."
No distinction is made between felonies and misdemeanors or types or seriousness of crimes in the above quoted language from the Constitution of Michigan and the Michigan court rule relating to the rights of criminal appeal.
The following definitions appear in the Michigan statutes:
"The term `felony' when used in this act, shall be construed to mean an offense for which the offender, on conviction, may be punished by death, *557 or by imprisonment in state prison." CL 1948, § 750.7 (Stat Ann 1962 Rev § 28.197).
"When any act or omission, not a felony, is punishable according to law, by a fine, penalty or forfeiture, and imprisonment, or by such fine, penalty or forfeiture, or imprisonment, in the discretion of the court, such act or omission shall be deemed a misdemeanor." CL 1948, § 750.8 (Stat Ann 1962 Rev § 28.198).
The only distinction between felonies and misdemeanors, insofar as these definitions are concerned, appears to be whether imprisonment is to be in State prison or the county jail.
CL 1948, § 750.504 (Stat Ann 1954 Rev § 28.772), provides:
"A person convicted of a crime declared in this or any other act of the state of Michigan to be a misdemeanor, for which no other punishment is specially prescribed by any statute in force at the time of the conviction and sentence, shall be punished by imprisonment in the county jail for not more than 90 days or by a fine of not more than 100 dollars, or by both such fine and imprisonment."
CLS 1961, § 774.1 (Stat Ann 1954 Rev § 28.1192), empowers justices of the peace to try all criminal charges punishable by fine not exceeding $100 or imprisonment in the county jail not exceeding 3 months or both such fine and imprisonment. The justice of the peace is empowered to impose these sentences. These are referred to as criminal offenses cognizable by a justice of the peace. Whether or not thus cognizable is made dependent on the permissible maximum penalty and not on whether the statute has denominated the offense to be a misdemeanor or felony.
CL 1948 and CLS 1961, §§ 766.2-766.15 (Stat Ann 1954 Rev §§ 28.920-28.933), inclusive, relate to *558 offenses not cognizable by a justice of the peace. In these it is provided that the justice of the peace may issue a warrant, after arrest conduct an examination of the accused and either discharge him or bind him over for trial in circuit court, depending on whether it shall appear to the justice of the peace that a crime not cognizable by him has been committed and whether there is probable cause to believe the defendant has committed it. The subsequent proceedings occur in the circuit court or other court of comparable level having jurisdiction thereof.
There are instances in the Michigan statutory law in which offenses are named misdemeanors and for which the maximum penalty fixed exceeds $100 fine or 3 months' imprisonment or both. For example: Certain violations of rules and regulations of the public utilities commission are termed "misdemeanors" (CL 1948, § 460.55 [Stat Ann § 22.5]) and the penalties fixed at not less then $10 nor more than $1,000 or imprisonment in county jail for not more than 6 months, or both. In People v. Causley, 299 Mich. 340, after discussion of the distinction between felonies and misdemeanors, this Court speaks of People v. Lamb, 153 Mich. 675, in which, so the Court said, the crime of extortion there involved was a misdemeanor punishable by not more than one year in county jail or $250 fine or both. See, also, In re Moynahan, 255 Mich. 497, in which this Court refers to the offense therein involved, possession of narcotics, as a misdemeanor punishable by imprisonment limited to one year. See, also, in that connection, In re Spencer, 252 Mich. 48. This gives rise to the term, used in criminal law circles, "circuit court misdemeanors". That is to say, the statute labels the offense a misdemeanor, but, by fixing the maximum penalty, renders the offense one not cognizable by a justice of the peace *559 and, hence, one in which the limit of his power is to bind over to circuit court. When so bound over the procedure is the same as for felonies. Defendant's need for legal assistance of counsel then may well be as great as in felony cases. The name "felony" or "misdemeanor" can make small difference as relates to his constitutional right to such assistance. We entertain no doubt that as to such circuit court misdemeanor cases the rule and constitutional requirements are the same as relates to felonies. To hold otherwise would mean, as said in Bolkovac v. State, supra, that the legislature could defeat constitutional rights by the simple device of labelling offenses as misdemeanors.
In the instant case, however, the offense was one cognizable by a justice of the peace. It might be urged that the apparent distinction made in 18 USCA, § 3006A(b), supra, between a felony or misdemeanor, on the one hand, and a "petty offense" has application, should be adopted by this Court, and applied here. Scarcely can it be said, however, that a permissible maximum sentence of 3 months' imprisonment or $100 fine or both leaves the offense one to be regarded as so petty as not entitling the indigent accused to the assistance of counsel. His liberty is involved and in jeopardy in such case. For this the constitutional right is designed to insure equality of treatment and chances for acquittal between the rich who can afford to hire counsel and the poor who cannot.
In behalf of the people it is protested, however, that holding for defendant's contentions in this criminal case would result in a vast wave of pleas of not guilty in cases of clear guilt, with demands for free counsel, in traffic violations of city and village ordinances, of such proportions as to paralyze judicial proceedings in justice of the peace or magistrate courts. Note may be taken with interest, *560 although not controlling of the case at bar, of the following:
"As before said, the violations of the village ordinances are not considered criminal offenses. Mixer v. Supervisors, 26 Mich. 422; People v. Jackson, 8 Mich. 110; Jackson v. People, 8 Mich. 262." Village of Vicksburg v. Briggs, 85 Mich. 502, 508.
"The term `criminal cases,' used in the laws, refers to none but prosecutions under the State laws. In Jackson v. People, 8 Mich. 262, and People v. Jackson, 8 Mich. 110, we held that cases under city ordinances could not be brought into this Court by writ of error, or exceptions, but must come up on certiorari. They resemble criminal cases only in being penal proceedings, but no offense is a crime which does not violate the law of the land." Mixer v. Supervisors of Manistee County, 26 Mich. 422, 424.
"Violations of village ordinances are not regarded as criminal offenses." 1 Gillespie's Michigan Criminal Law & Procedure, § 2, p 5.
Reversed and remanded to recorder's court for appointment, upon finding of indigency, of appellate counsel for defendant and furnishing of all portions of the transcript and record essential in preparation of postconviction motions and appeal.
ADAMS, J., concurred with DETHMERS, J.
SOURIS, J. (concurring in reversal).
Mr. Justice Jackson, concurring in McGrath v. Kristensen (1950), 340 U.S. 162 (71 S. Ct. 224, 95 L ed 173), gracefully and forthrightly acknowledged error in a prior opinion he had rendered as attorney general and, in the process, he assembled for us other memorable examples of judicial recantations. His own and *561 some others included in his opinion are set forth in the margin.[1]
I should like to think that I shall display as much candor and grace as did Justice Jackson whenever it becomes necessary for me to "recede from a prior opinion that has proven untenable and perhaps misled others". This appeal, however, does not present an occasion for my confession of error, Mr. Justice BLACK'S current opinion herein notwithstanding.
In his current opinion Justice BLACK breaches that confidence which traditionally has surrounded views expressed in the sanctity of the Court's conference room, in private discussions among the Justices, and in draft opinions never subscribed for *562 a variety of reasons. He discloses publicly a view I expressed in a draft opinion and then retracted before judgment, not because of persuasion of error but, rather, because further reflection upon my colleagues' contemporaneous views suggested to me a sounder appellate basis for our judgment. Whether I was right or wrong in the views I subsequently retracted is not important now, for those views remain retracted by me and would have misled no one had they not been resurrected by Justice BLACK. What is important, however, is Justice BLACK'S implicit threat to the continued privacy of our deliberations upon pending appeals.
It has been my understanding that views expressed by judges of an appellate court while deliberating upon their decisions are confidential until they appear in an opinion, if they ever do, over the signature of the author. Such privacy permits judges to discuss freely among themselves all issues involved in a case, to advance tentative views for the sometimes enlightening reactions of wiser colleagues and to criticize candidly and sometimes bluntly the notions offered by other colleagues, all without fear of subsequent embarrassment to any member of the Court by public disclosure of anything said or written which does not survive the ordeal as a subscribed formal opinion.
In my judgment such freedom of expression in camera should be encouraged among Justices whose duty it is to strive, at least, to reach majority accord when that can be achieved without compromise of legal principles. Such freedom should not be inhibited by the threat of public disclosure as Justice BLACK has done today.
I agree with Mr. Justice DETHMERS, but for reasons somewhat different from those stated by *563 him, that the trial judge erred in denying defendant's request, as an indigent, for appointment of appellate counsel and for a free copy of his trial transcript in order to appeal his conviction of a misdemeanor cognizable by a justice of the peace. I also agree with Justice DETHMERS, and based upon the reasons and authorities he cites, that the defendant's service of his misdemeanor jail sentence, under the circumstances of this case, does not render a future appeal of that conviction moot so as to justify the trial judge's denial of the defendant's request, without a finding that he is not indigent, for appointment of appellate counsel and for the trial transcript.
Defendant was convicted on May 11, 1964, by a judge of the recorder's court for the city of Detroit, sitting without a jury, of the misdemeanor[2] of receiving and concealing stolen property of a value under $100. After service of his 90-day jail sentence imposed upon conviction of this offense, defendant was imprisoned and there remains, it is fair from this record to say, as a consequence of his misdemeanor conviction, the State's parole board having revoked defendant's parole from a prior felony imprisonment because of defendant's misdemeanor conviction.
Effective August 1, 1964, this Court amended GCR 1963, 785 by adding a new subrule .4. Subrule 785.4 is subdivided into two distinct parts. The first subpart, 785.4(1), applies to all criminal cases in which sentence is imposed on or after August 1, 1964, the effective date of the amendment. That subpart requires, inter alia, that the sentencing judge advise the defendant at the time of sentencing of his constitutionally granted right to appellate review of his conviction (Const of 1963, art 1, § 20)[3] and, if *564 the defendant is unable financially to retain his own attorney for such purpose, that the trial judge will appoint counsel for him and will furnish whatever portions of the trial transcript are needed by such counsel. Subpart 785.4(1), in its entirety, reads as follows:
".4 Appellate Court Review.
"(1) Right to Timely Appeal. Hereafter, immediately upon sentencing, the court shall advise the defendant in open court that he is entitled as a matter of constitutional right to appellate review of his conviction and that, if defendant is financially unable to provide counsel to perfect such appeal, the court will appoint counsel for him and will furnish counsel with such portions of the trial transcript counsel requires to prepare postconviction motions and to perfect an appeal. The court shall further advise defendant that such request for the assistance of counsel must be made within 60 days on a form to be given to defendant by the court. *565 Proceedings hereunder shall be stenographically recorded and a transcript thereof promptly made and filed with the clerk of the trial court as a part of the record of the case."
Almost a year and a half before our Court belatedly adopted subrule 785.4, the United States Supreme Court, in Douglas v. California (1963), 372 U.S. 353 (83 S. Ct. 814, 9 L ed 2d 811), had ruled that when a State accorded a right of appeal to defendants convicted of crimes, as Michigan does now, it was obliged by the requirements of the equality clause of the Fourteenth Amendment of the United States Constitution to provide indigent appellants the assistance of counsel on appeal in order to avoid discrimination between rich and poor. In the Douglas Case, California provided for appellate review of criminal convictions as a matter of right, but it did not require the appointment of appellate counsel for indigent defendants requesting such assistance unless the appellate court first made an independent investigation of the record and determined that it would be advantageous to the defendant or helpful to the appellate court to have counsel appointed.
The United States Supreme Court held that California's denial of appellate counsel to those indigent defendants whose requests therefor did not survive the appellate court's preliminary investigation of the trial court record, thereby forcing the indigent to prosecute his appeal as of right without the assistance of counsel, constituted an invidious discrimination between rich and poor in violation of the equality clause of the Fourteenth Amendment of the United States Constitution. The Supreme Court said (pp 357, 358):
"where the merits of the one and only appeal an indigent has as of right are decided without benefit *566 of counsel, we think an unconstitutional line has been drawn between rich and poor. * * *
"The present case, where counsel was denied petitioners on appeal, shows that the discrimination is not between `possibly good and obviously bad cases,' but between cases where the rich man can require the court to listen to argument of counsel before deciding on the merits, but a poor man cannot. There is lacking that equality demanded by the Fourteenth Amendment where the rich man, who appeals as of right, enjoys the benefit of counsel's examination into the record, research of the law, and marshalling of arguments on his behalf, while the indigent, already burdened by a preliminary determination that his case is without merit, is forced to shift for himself. The indigent, where the record is unclear or the errors are hidden, has only the right to a meaningless ritual, while the rich man has a meaningful appeal."
On the same day the United States Supreme Court decided Douglas, supra, it also decided Lane v. Brown (1963), 372 U.S. 477 (83 S. Ct. 768, 9 L ed 2d 892), and Draper v. Washington (1963), 372 U.S. 487 (83 S. Ct. 774, 9 L ed 2d 899). The essence of those decisions is that, when a State grants an appeal as of right, it may not discriminate between rich and poor by denying to an indigent appellant the use of a trial transcript if such transcript may be purchased by an affluent appellant for use in presenting his appeal. See, also, Griffin v. Illinois (1956), 351 U.S. 12 (76 S. Ct. 585, 100 L ed 891). Mr. Justice Goldberg, in Draper, put the matter succinctly (p 496):
"In all cases the duty of the State is to provide the indigent as adequate and effective an appellate review as that given appellants with funds the State must provide the indigent defendant with means of presenting his contentions to the appellate *567 court which are as good as those available to a nonindigent defendant with similar contentions."
None of the 1963 cases so far discussed, Douglas v. California, Lane v. Brown, and Draper v. Washington, was decided on the basis of the Sixth Amendment of the United States Constitution, as was Gideon v. Wainwright (1963), 372 U.S. 335 (83 S. Ct. 792, 9 L ed 2d 799, 93 ALR2d 733), and other similar Federal and State cases concerned with the question whether a State is obliged constitutionally to provide trial counsel for an indigent person to be tried in its criminal courts. Instead, Douglas, Lane, and Draper were planted squarely upon the equality clause of the Fourteenth Amendment. For that reason Gideon v. Wainwright and other similar Federal and State cases cited to us by the parties hereto, are not apposite to the narrow issue presented in this appeal involving an indigent's right to appellate counsel and to trial transcript. In the event defendant succeeds subsequently in prosecuting an appeal challenging the validity of his misdemeanor conviction, there will be time enough for this Court to determine whether his conviction without the assistance of trial counsel, an issue not presently before us, offends the Sixth Amendment as applied to the States in Gideon and, so, must be set aside for a new trial.
Considered in the context of Michigan's new constitutional guarantee of appellate review as of right, it cannot be doubted that Douglas v. California, Lane v. Brown, and Draper v. Washington require Michigan to appoint appellate counsel and to furnish trial transcripts for indigents in all criminal cases which now in this State may be appealed as of right. These are the requirements, of Federal constitutional magnitude, announced by the Supreme Court in Douglas, Lane and Draper, that this Court implemented *568 by adoption of subpart 785.4(1) of the rule.
But subpart 785.4(1) had not been adopted when defendant Mallory was convicted. Thus that part of the rule avails him nothing now, although it could be argued that had he claimed an appeal as of right within the time therefor then provided by GCR 1963, 803, as also amended January 21, 1964, he, as an indigent, would have been entitled to the services of appellate counsel and to be furnished trial transcript by the requirements of the equality clause of the Fourteenth Amendment as determined by Douglas, Lane, and Draper, even absent their timely implementation by us by rule. The fact is that defendant Mallory did not attempt to perfect a timely appeal as of right, nor did he within such time assert his rights to trial transcript and to the appointment of counsel to assist him in doing so.
Thus, if he has any rights to such transcript and to the appointment of appellate counsel now, they must be found elsewhere than in GCR 1963, 785.4(1). That brings us to the second distinct part of the subrule added by our amendment effective August 1, 1964.
While 785.4(1) applies prospectively, in the sense that it specifies procedures to be followed at sentencing in current criminal cases where timely appeal as of right exists, 785.4(2) applies retrospectively, in the sense that it specifies the procedures for furnishing appellate counsel and free trial transcript to indigents in all other criminal cases completed through sentencing before August 1, 1964, the effective date of 785.4(1). Having been convicted and sentenced prior to the effective date of 785.4(1), defendant Mallory's entitlement to the appointment of appellate counsel and to the use of a trial transcript *569 must be found, if it exists by court rule as of right, in 785.4(2).
Douglas v. California, supra, does not hold that a State must, as a matter of Federal constitutional requirement, appoint appellate counsel to assist an indigent in pursuing discretionary review of his criminal conviction. While it does not so hold, some have argued that the constitutional principles of equality which the Supreme Court relied upon in Douglas, and in Lane and Draper with reference to the availability of trial transcript, apply as well to applications for discretionary review as they do to appeals as of right. See, pertinently, Burns v. Ohio (1959), 360 U.S. 252 (79 S. Ct. 1164, 3 L ed 2d 1209). But whether the Supreme Court ultimately decides they do or they do not, this Court in promulgating GCR 1963, 785.4(2) said that in all other criminal cases than those current ones to which 785.4(1) applies, and that would include in 785.4(2) the criminal cases long since tried to conviction and sentencing, in which application for discretionary review may be filed, upon request by an indigent defendant our trial courts shall appoint counsel and shall furnish so much of the trial transcript as such counsel requires to prepare delayed motions for postconviction proceedings in the trial court and to prepare applications for leave to take delayed appeal.
There is no discretionary power granted to trial judges in this subpart of the rule to refuse appellate counsel or trial transcript, once indigency is determined.
It is this part of the rule which, by its express terms, required the trial judge to grant defendant Mallory's request for appellate counsel and trial transcript upon proof of indigency. The trial judge's refusal to do so requires our reversal.
*570 Subpart 785.4(2), in its entirety, reads as follows:
"(2) Delayed Appeal. In all other criminal cases, application for leave to take delayed appeal may be filed pursuant to the provisions of Rule 806. Upon defendant's request, if defendant is indigent, the trial court in which defendant was convicted shall appoint counsel for him and shall furnish such portions of the trial transcript counsel so appointed requires to prepare delayed motions for postconviction proceedings in the trial court and to prepare an application for leave to take delayed appeal. Requests for appointment of appellate counsel shall be in writing and accompanied by an affidavit of indigency setting forth the facts upon which defendant relies for support of his claim that he is too poor to employ counsel. Such written request and affidavit shall be filed in the trial court and a copy thereof shall be served upon the prosecuting attorney of the county in which the trial court is located. Counsel shall be appointed by the trial court if, after hearing, the defendant is found to be indigent or if the prosecuting attorney does not file objections within 30 days of service upon him of defendant's request and affidavit of indigency. Appeal fees shall be waived for indigent defendants for whom appellate counsel has been appointed by the court."
Having implemented, in subpart 785.4(1), the clear requirements of the Fourteenth Amendment, as construed in Douglas v. California, Lane v. Brown, and Draper v. Washington, article 1, § 20 of our Constitution of 1963 considered, it may be conceded, arguendo, that this Court was not obliged to do more than that by any United States Supreme Court decision. Yet this Court did go beyond the express requirements of Douglas, Lane, and Draper in adopting subpart 785.4(2) and it did so for sound reasons of public policy if not, indeed, for reasons of Federal constitutional compulsion.
*571 At the time we acted, in the summer of 1964, there had been granted the right of appeal in all criminal prosecutions only since January 1, 1964, the effective date of our Constitution of 1963. Prior thereto this Court had recognized no such right in criminal cases except in those in which a prison sentence of one or more years had been imposed and that right we did not recognize until January 1, 1963. See GCR 1963, 806.2(3) prior to its amendment on January 21, 1964. Thus, when subrule 785.4 was adopted, of the 8,499 inmates of the State's prisons, 3,640 had been convicted and sentenced before 1963 when there was no appeal as of right from any criminal conviction.[4] From those 3,640 prisoners (whose number diminishes each day by death, service of sentence, and parole) and from those convicted and sentenced to imprisonment for more than one year subsequent to January 1, 1963, but who had not perfected appeals as of right, this Court continued to receive applications for leave to take delayed appeal for its consideration usually without references with pinpoint accuracy to the trial transcripts to support the claims made and without the beneficial assistance of appellate counsel in the translation of their inept pleas of injustice into the legal language judges can understand.
Our published volumes of official reports through volume 374 bear silent witness to the infrequency of our grant of leave to appeal such cases. That errors meriting reversal existed in some at least of those cases, but were not revealed to our appellate gaze by the unskilled draftsmen of those applications, none can deny. On the other hand, other applications were being filed in behalf of affluent *572 prisoners who could afford not only the full trial transcript, sometimes even printed for our myopic eyes, but also skilled counsel to prepare and present carefully documented and scholarly briefs riddled with authoritative legal citations and references to the trial transcript to command our attention and our granted leave. Comparison of such applications and briefs, prepared by counsel, with those which were homemade by sometimes barely literate indigent prisoners, demonstrated that indigency alone was responsible for the gross disparity in their persuasive power.
It seemed then to a majority of the Court, and it still seems so to us, that justice to those prisoners who were too poor to retain counsel required no less than that they at least be accorded the assistance of appellate counsel and be furnished trial transcripts to assist them in their attempts to persuade us that there was merit in our undertaking to review their convictions. We did not extend to such prisoners the right to appeal which had been granted, first by court rule and then by our new Constitution, to those convicted subsequent to January 1, 1963; what we did in subpart 785.4(2), instead, was to provide those indigent prisoners, not entitled to appeal their convictions as of right, with the professional skills and tools necessary to prepare more effectively than they could previously their applications for discretionary grant of leave to appeal.
It is suggested that subrule 785.4 has applied heretofore only to felonies and, presumably, for that reason subpart 785.4(2) is not available to defendant Mallory. No such restriction appears in the language of the subrule. 785.4(1) of that subrule, considering its language in the light of Douglas v. California, Lane v. Brown, and Draper v. Washington, supra, certainly must reach as far as does article 1, *573 § 20 of our Constitution of 1963 by which the right of appellate review is granted "in every criminal prosecution." While there has been expressed in these opinions the view that such constitutional language may not apply to city and village ordinance violations, no one yet has claimed that our people in adopting it did not intend that it apply to statutory misdemeanors as well as to felonies.[5] 785.4(2) of *574 the subrule applies to those criminal cases, whether misdemeanors or felonies, which were tried to conviction and sentence before the August 1, 1964 effective date of 785.4(1) and in which an application for discretionary grant of leave to appeal now is necessary if there is to be appellate review. As a practical matter, except for such rare cases as this case of Mallory and its companion, People v. Copeland, 378 Mich. 611, where the misdemeanor convictions are the effective causes of defendants' continued imprisonment notwithstanding their completion of service of the misdemeanor sentence, 785.4(2) will not be available to a misdemeanant simply because few, if any other, misdemeanants convicted and sentenced after the effective date of 785.4(1) still remain incarcerated as a result of such convictions. In the case of current convictions since adoption of subrule 785.4, whether of felonies or of misdemeanors, an indigent's right to appellate counsel and trial transcript is measured by the time limitations contained in 785.4(1). If such right is not invoked timely, it may subsequently be granted but, as was previously our universal practice, only in the exercise of the inherent discretionary power of the trial or appellate court and not by virtue of anything required as of right either by 785.4(1) or 785.4(2).
It may be noted, furthermore, that of all of the subrules of GCR 1963, 785, only subrule 785.3 ever *575 has been limited by express language to felonies. This Court currently is considering its express expansion to include some, if not all, misdemeanors.
It has been suggested also that it would be anomalous to read subrule 785.4 as requiring appointment of appellate counsel to all indigent misdemeanants as well as felons while subrule 785.3 may not require appointment of trial counsel in some misdemeanor cases. That there is a lack of logical symmetry in this possibility cannot be denied. However, as Mr. Justice Holmes reminded us 85 years ago, in The Common Law, "The life of the law has not been logic: it has been experience." Our own experience suggests that where opportunity exists for effective appellate review of trial court proceedings, such proceedings usually are conducted with greater diligence toward the rights of the accused and greater attention to the adequacy of the record to support what is done in the trial court. If this great society of ours yet cannot afford to appoint both trial and appellate counsel for every indigent charged with a misdemeanor and a choice must be made between the two insofar as those indigents are concerned who are charged with commission of the lesser misdemeanors, our experience suggests that a greater public benefit will be realized by providing the means for effective appellate review than by furnishing trial counsel for all indigent misdemeanants.
Furthermore, our people, having granted, in article 1, § 20 of our Constitution of 1963, appeals as of right "in every criminal prosecution," by which no one has suggested yet it was intended to exclude any statutory misdemeanors, it is doubtful that denial of appellate counsel to such misdemeanants, or any of them, would withstand Federal constitutional challenge. See Douglas v. California, supra, discussed in the forepart of this opinion.
*576 Whether or not required by constitutional principles of equality, what we did in adopting subpart 785.4(2) reduced the likelihood that any of our people would remain imprisoned in this State as the result of convictions which could not withstand appellate scrutiny. There is no way by which we can determine how many trial judges have reversed their own prior decisions on postconviction proceedings in the trial courts since adoption of 785.4(2). However, data is available from which we can determine the incidence of reversible error found on discretionary appellate review after 785.4(2) was adopted and appellate counsel and trial transcript were made available to indigent prisoners to obtain and perfect such discretionary appellate review. That data[6] and the opinions of the Court of Appeals *577 which, since January 1, 1965, has heard and decided such appeals disclose that there have been a significant number of reversals for substantial errors which the defendants, unassisted by counsel and without trial transcripts, previously could not have persuaded a court merited review let alone reversal. Whether such asserted errors relate to the substantive issue of guilt or innocence or to the procedure by which guilt is established, no defendant appearing in our courts should be denied, just because he is poor, the means effectively to persuade us that reversible error occurred and that a new trial should be granted. Justice requires no less in a society such as ours which regards equality as the essence of democracy and which guarantees to every man that measure of fair treatment by his government we call by the name of due process of law.
T.M. KAVANAGH, C.J., concurred with SOURIS, J.
KELLY, J. (concurring in reversal).
I join in Justice BLACK'S decision that, "until the Supreme Court speaks otherwise, I shall look upon the pertinent requirement of the Sixth Amendment and of our Constitution as being fully consistent with the petty offense exception made by the criminal justice act," and I hereby register my objection and dissent to the recent August 24, 1966, amendment to Rule 785 of the General Court Rules of 1963 (effective January 1, 1967), requiring appointment of counsel to those charged with misdemeanors upon conviction for which the accused could be jailed for 90 days or more.
*578 I disagree with Justice BLACK'S affirmance and agree with Justice DETHMERS' reversal because defendant has served and is still serving a lengthy prison sentence in addition to a 90-day confinement in jail due to the fact that a recorder's court judge, without a jury and without defendant being represented by counsel, pronounced judgment that defendant was guilty of a petty misdemeanor.
The record discloses:
(1) A letter dated January 8, 1965, from the parole board, signed by Frank G. Buchko, "Re: Alton Mallory, B-101696," as follows:
"The above named man was paroled on 4-2-64 for a period of two years. He was returned to prison on 7-30-64 and at a parole violation hearing conducted on August 17, he was found automatically guilty of parole violation by reason of a conviction on 5-11-64 for receiving stolen property. He received a term of 90 days at the Detroit house of correction as a result of this conviction." (Emphasis ours.)
(2) Frank G. Schemanske, judge of the recorder's court, on January 25, 1965, certified the "concise statement of proceedings and facts in support of the application for leave to appeal," which statement reads:
"1. On May 11, 1964, Alton Mallory, defendant-appellant, stood charged and was convicted of the criminal offense of receiving and concealing stolen property under the value of $100 in the recorder's court of the city of Detroit, by the Honorable Frank G. Schemanske, judge of the recorder's court. Defendant was sentenced to 90 days in the Detroit house of correction, and the said 90 days have been served.
"2. Trial by jury had been waived. Defendant was not represented by counsel at the trial.
*579 "3. On or about May 19, 1964, an attorney (on behalf of the defendant) made a motion for a new trial. The motion was withdrawn by the attorney on May 27, 1964, and never came on for a hearing. The 15-day period in which to make a motion for new trial in misdemeanor cases (as provided in Rule 26 of the recorder's court of the city of Detroit) expired on May 26, 1964.
"4. On September 25, 1964, defendant, in propria persona, made a motion for appointment of appellate counsel and for free transcript for appellate purposes.
"5. On October 29, 1964, defendant's motion was denied by Judge Schemanske for the reason `that the case is already moot, since the sentence has been served.'"
(3) Defendant's January 27, 1965, affidavit (Court of Appeals) pursuant to GCR 1963, 806.3(3) (b), as follows:
"1. That he is the defendant and appellant in these proceedings.
"2. That although a motion for a new trial was made in the lower court by an attorney on May 19, 1964, said motion was withdrawn by the attorney without the permission of defendant-appellant and never came on for a hearing.
"3. That he is presently incarcerated in the State Prison of Southern Michigan, at Jackson, Michigan, for violation of parole. An automatic adjudication of guilt of that offense was made when he was convicted of the instant offense of receiving and concealing stolen property."
(4) The order of the Court of Appeals, dated March 2, 1965:
"It is ordered that the application for delayed appeal be, and the same is hereby denied, the question *580 presented therein being moot, the case of People v. Pyrros, 323 Mich. 329 controlling therein."
Justice DETHMERS, considering the question of "mootness," states:
"After the May 11, 1964, misdemeanor conviction, defendant was found guilty by the parole board of parole violation and, after service of his 90-day misdemeanor sentence, was remanded to State prison as a parole violator and is still there as provided by law, serving the remainder of his sentence for the 1962 felony conviction. * * *
"Defendant's misdemeanor conviction automatically brought about a finding by the parole board of parole violation or that, at least, that conviction was an element and factor in the parole violations charged against defendant and considered by the board in making its finding of parole violation. Accordingly, we consider the above cases cited by the people with respect to mootness inapt. Defendant's present incarceration may well be considered a consequence, in part at least, of this misdemeanor conviction. More to the point is United States v. Morgan, 346 U.S. 502 (74 S. Ct. 247; 98 L ed 248), in which the United States Supreme Court said (pp 512, 513):
"`Although the term has been served, the results of the conviction may persist. Subsequent convictions may carry heavier penalties * * * As the power to remedy an invalid sentence exists, * * * respondent is entitled to an opportunity to attempt to show that this conviction was invalid.'" (Emphasis ours.)
Justice O'HARA writes:
"I do agree with Mr. Justice DETHMERS that the appeal in this case is not dismissible as moot for the reasons he assigns and on the basis of the authority he cites."
*581 I agree with Justices DETHMERS and O'HARA.
The parole board rules and our decisions[*] authorize the board in finding that defendant was "automatically guilty of parole violation by reason of a conviction on 5-11-64 for receiving stolen property." The board does not have or exercise the right to pass appellate judgment on court decisions.
Defendant does not challenge the board's action, but asks for appellate review of the May 11, 1964, misdemeanor conviction that automatically placed him behind prison walls for a period that has not expired at the time I write this opinion.
We are confronted with a misdemeanor charge and a felony penalty, and the same reasons that justify a finding that the case is not moot also justify granting defendant's request to have counsel appointed for appeal.
Repeating the words of the United States Supreme Court in United States v. Morgan, supra, defendant "is entitled to an opportunity to attempt to show that this conviction was invalid."
I agree with Justice DETHMERS' holding for reversal and remand.
ADAMS, J. (concurring specially).
I concur with the 3d, 4th and 5th paragraphs of Justice SOURIS' opinion. Canon 19 of the canons of judicial ethics deals with judicial opinions. It reads in part:
"It is of high importance that judges constituting a court of last resort should use effort and self-restraint to promote solidarity of conclusion and the consequent influence of judicial decision."
In the opinion of the undersigned, the above sentence from Canon 19 is applicable here.
*582 T.M. KAVANAGH, C.J., DETHMERS, and SOURIS, JJ., concurred with ADAMS, J.
BLACK, J. (dissenting).
In the course of his special concurrence (Gideon v. Wainwright [March 18, 1963], 372 U.S. 335 [83 S. Ct. 792, 9 L ed 2d 799, 93 ALR2d 733]); Mr. Justice Harlan wrote what appears immediately below. No other Justice undertook to question these words (p 351):
"The special circumstances rule has been formally abandoned in capital cases, and the time has now come when it should be similarly abandoned in non-capital cases, at least as to offenses which, as the one involved here, carry the possibility of a substantial prison sentence. (Whether the rule should extend to all criminal cases need not now be decided.)"[1]
The sole and controlling question before this inferior Court is whether it, distinguished from the Supreme Court of the United States, should "extend" the constraint of the Sixth Amendment to "all criminal cases." I prefer as before to let the Supreme Court lead the way when it comes to ascertainment of what was required and so is required by some standing principle or provision appearing in the National Constitution; that Court having expressly refrained thus far from such ascertainment. So much said, I stand by such Federal guidelines as are known rather than those which the civil liberties committee of the State Bar, appearing here amicus, confidently predicts are ahead for petty-case justice in every magisterial court of this land.
First: With its companion (People v. Copeland, 378 Mich. 611) this case has plunged the Supreme *583 Court of Michigan into another thorny thicket of supreme constitutional law; a thicket made the more spinous by importunate prodding on the part of the aforesaid committee. Arriving as in People v. Foster, 377 Mich. 233, with an issue made technically moot by completed service of a maximally imposed jail sentence, the committee insists that this Court should lead off by proclaiming that the right to counsel, provided as it is by the Sixth Amendment[2] extends to all cases of "petty offense," the accused person being indigent.
To the writer the committee is a little too ardent. Moreover, its predictive record is not sufficiently dependable for any such far-reaching proclamation by this Court. See the committee's recent reliance upon the petitioner's presentation in Schmerber v. California[3] (45 MSBJ, No. 9, pp 24-26) and compare it with the Supreme Court's ruling that Schmerber had been denied no constitutional right as claimed (Schmerber v. California [June 20, 1966], 384 U.S. 757 [86 S. Ct. 1826, 16 L ed 2d 908]).
Now this defendant's conviction was for an offense somewhat less than "petty."[4] That being so, I cannot bring myself to join others in voting to overthrow the policy congress effected when the criminal justice act of 1964[5] was enacted, or to join in holding that that act failed to conform fully with Sixth Amendment assurances. Surely this Court is or at least ought to be sated, by now, with these *584 attempts "to outrun the Supreme Court of the United States."[6]
The Supreme Court has never gone so far as to say that the framers, debaters and adopters of the Sixth Amendment, intended that counsel and transcript should be provided at public expense for the indigent who has been charged with or convicted of petty offense as well as the indigent who has been charged with or convicted of felony or other serious offense. Griffin v. Illinois, 351 U.S. 12 (76 S. Ct. 585, 100 L ed 891, 55 ALR2d 1055); Douglas v. California, 372 U.S. 353 (83 S. Ct. 814, 9 L ed 2d 811); Lane v. Brown, 372 U.S. 477 (83 S. Ct. 768, 9 L ed 2d 892) and Draper v. Washington, 372 U.S. 487 (83 S. Ct. 774, 9 L ed 2d 899), speaking as they do of discrimination against the poor "on account of their poverty" in cases of conviction for murder, assault with a deadly weapon, armed robbery, et cetera, do not as presently contended support any such conclusion. Indeed, had any one of the cited cases ruled as thus claimed, then the constitutional infirmity of the presently discussed exception, made by the aforesaid criminal justice act, would stand forth for all to see.
*585 In this latest of civil liberties cases certain mutually assured Justices have placed unitary bet that the Supreme Court will, sooner or later, say that the National Constitution compels each of the States to bear the load of supplying counsel and all trappings of appeal where the accused or prisoner has been charged with or convicted of a "petty offense," and is indigent. For terse reply I suggest that if that guess proves out, then congress will have to amend hastily subsections (a) and (b) of aforesaid section 3006A. The two subsections exhibit the considered policy of congress (not retroactive by the way); a policy which, by presumption specially forceful in this State Court, validly limits the free counsel and other free benefits thereof to cases where the indigent defendant is charged with or convicted of felony or misdemeanor not constituting a "petty offense." To be precise:
The initial sentence of subsection (a) provides:
"Each United States district court, with the approval of the judicial council of the circuit, shall place in operation throughout the district a plan for furnishing representation for defendants charged with felonies or misdemeanors, other than petty offenses as defined in section 1 of this title, who are financially unable to obtain an adequate defense.";
and the initial sentence of subsection (b) pursues the same "petty offense" exception:
"In every criminal case in which the defendant is charged with a felony or a misdemeanor, other than petty offense, and appears without counsel, the United States commissioner or the court shall advise the defendant that he has the right to be represented by counsel and that counsel will be appointed to represent him if he is financially unable to obtain counsel." (Emphasis supplied by present writer.)
*586 "Petty offense" has been defined, ever since the amendment of December 16, 1930 (see Duke v. United States, 301 U.S. 492 [57 S. Ct. 835, 81 L ed 1243]), as one where the statutory penalty does not exceed imprisonment for a period of six months, or a fine of not more than $500, or both. Section 1 "of this title," to which (a) above refers, presently defines "petty offense" this way:
"(3) Any misdemeanor, the penalty for which does not exceed imprisonment for a period of six months or a fine of not more than $500, or both, is a petty offense." (18 USCA, § 1.)
So there is nothing new about the distinction congress has made and retained between felonies and serious misdemeanors on the one hand and petty offenses on the other. As said in Duke v. United States, supra at 494:
"The original section divides crimes into felonies and misdemeanors. The evident object of the proviso [defining "petty offenses"] was to bring about a subdivision of misdemeanors by creating a class of misdemeanors of minor gravity to be known as petty offenses; to be tried, as proposed by other legislation (which failed), by United States commissioners."
Second: Pressed upon us is section 20 of article 1 of the Constitution of 1963.[7] Pertinent to the charge against the defendant Mallory and his ensuing conviction, I am unable to find anything of present persuasiveness in that section, our question *587 being whether the 172-year-old constitutional phrase "In every criminal prosecution" includes, by intention of the people voting in 1963, "prosecution" for minor or petty offenses. The answer to that question is the answer this Court has given before;[8] that a constitutional provision is looked upon and construed by the judiciary as the people understood it at the time of debate and vote, having regard for the "laws and usages" of that time. As said in People v. Harding, 53 Mich. 481, 485:
"Every constitution has a history of its own which is likely to be more or less peculiar; and unless interpreted in the light of this history, is liable to be made to express purposes which were never within the minds of the people in agreeing to it. This the Court must keep in mind when called upon to interpret it; for their duty is to enforce the law which the people have made, and not some other law which the words of the constitution may possibly be made to express."
Now this Constitution of 1963 has "a history of its own" so far as concerns the constitutional expression "criminal prosecution;" a history of words, meanings and public comprehension going back to the Sixth Amendment, and carrying from there through our Constitutions of 1835, 1850, and 1908. It is that the quoted expression has never been understood generally, or by any judgment of the Supreme Court of the United States, or by any judgment of this Court, or by "any sense most obvious to the common understanding," as including within its compulsive scope all prosecutions for all offenses cognizable in all of our courts. Instead something gratuitously new has arrived in the seemingly prodigal minds of those who constitute *588 today's majority of the aforesaid committee; the idea that every indigent who is charged with violation of any penal law ought to have, at public expense, all of the rights enumerated below the mentioned constitutional expression and, accordingly, that the expression should be "extended" by judicial process right down the line so that the indigent jaywalker, simple trespasser, petty traffic violator, even the indigent expectorator upon the floor, platform, or steps of a passenger car or bus (see CL 1948, § 750.476 [Stat Ann 1954 Rev § 28.744]), is provided free counsel and free transcript at public expense, of course.
Now if all the courts of this country are to be bound by any such extension, it would appear more appropriate that the extension be announced first by the Supreme Court; not by a hopelessly divided State Court the past and as yet unassailed decisions of which, consistent as they are with that State's legislative policy (PA 1963, No 132 [CL 1948, § 775.16 (Stat Ann 1965 Cum Supp § 28.1253)], quoted post), hold that the various constitutional guaranties that are headed "In all criminal prosecutions" do not apply to those who are summoned into court as petty offenders.[9]
Third: Justice SOURIS contends by amended opinion that "We are not required in this case to consider whether trial counsel must be appointed to defend an indigent charged with a misdemeanor, or an offense otherwise described as `petty,' or an offense *589 against a village or city ordinance." As to this see Justice O'HARA'S rejoinder (p 607) and compare, post at page 595, the constitutional position taken by Justice SOURIS when the Court voted the amendments of Rule 785 (378 Mich xxxviii-xl) with that which now appears in the corresponding full paragraph of his opinion. The fact is that Mallory's appeal and Copeland's appeal turn exclusively upon the validity of their contention that counsel should by constitutional force have been provided immediately by the court before which they were called to account;[10] also that such was the exclusive basis upon which leave to appeal was granted simultaneously for both cases.
This is not all. The civil liberties committee has made doubly clear the purpose of both appeals. Refer to "Recommendation No. 4" made by the committee in its recent annual report, and to the committee's comment thereon (45 MSBJ, No 9, pp 24, 25). The recommendation:
"4. That the State Bar continue to recommend to the Supreme Court and the legislature that all necessary orders, rules and statutes be entered and enacted to guarantee:
(a) Effective representation in all criminal cases at all stages of trial and appeal for indigent defendants.
(b) Provision for adequate funds for investigative aids and other expenses incident to the adequate defense of the indigent.
(c) All reasonable and adequate aids to perfect an appeal for an indigent defendant, including trial *590 transcripts or necessary parts thereof, including the indigent accused who waives preliminary examination without benefit of counsel.
(d) Adequate compensation for assigned counsel."
The comment:
"4. Recommendation No. 4 has been made on previous occasions. The committee feels that if an offense is so important that the accused can be deprived of his liberty for as much as one day if he is convicted, then the matter is of sufficient import to require the appointment of counsel where the accused is indigent. This past year there were pending in the Supreme Court of Michigan two cases involving the question of whether an indigent misdemeanant is entitled as a matter of right to the appointment of counsel. People v. Alton Mallory (No. 51,212) and People v. Larry Tyrone Copeland (No. 51,213). The committee, with the consent of the executive committee of the commissioners of the State Bar submitted amicus briefs urging that there was such a right."[11]
Repeated for emphasis is the fact that the only reason all members of the Court were finally persuaded to grant the application of defendants Mallory and Copeland, for direct review by this Court, was to bring up for early determination the constitutional question Justice SOURIS says is not here. That question is here. Two opinions at least will deal with it.
Fourth: The foregoing appeal to Michigan's constitutional history is fortified by something not mentioned in the briefs or in any contributed opinion save that of Justice O'HARA. Justice O'HARA'S fully warranted criticism, of the Court's recent adoption of what to both of us are "unworkable" amendments *591 of GCR 1963, 785, suggests that some one ought to say openly on our record that this Court does not control the tax-limited purse strings of any public treasury; that the judiciary of Michigan is possessed of no power to perform in fact what those amendments left unrescinded will call for come January 1st, and that the extent as well as the cost of any such heady program is properly a matter for legislative consideration and determination.[12] Indeed, if one may speak as a citizen distinguished from a judicial position, it may well be said that the kind of money proposed to be spent on behalf of indigent petty offenders might better be devoted by the legislature to preventive law enforcement, the kind a State may obtain only by equipping enforcement agencies with the manpower and support they these days so sorely need.
Unless and until the legislature supplies that ever necessary wherewithal (as congress did in the criminal justice act), the mentioned amendments of GCR 1963, 785 will be confined to the more or less wholesale release of those who, being indigent, are charged with an inestimable number of petty offenses. Nay, it will mean more. There will be but spotty "prosecution" as against indigent petty offenders. Why should already discouraged peace officers apprehend such persons, knowing that the Supreme Court of the State will have rendered them practically immune from prosecution?
Does not someone wonder why, in the Federal system, the question of how and to what extent free counsel and auxiliary rights for indigents was left to congressional consideration and legislation? Is it not fully known that the beginning as well as future cost of such a program is so unascertainable *592 and unpredictable that Congress was compelled to appropriate for the criminal justice act, not in the usual form of a fixed sum or sums but in this form (§ 3006A):
"(h) Appropriations. There are authorized to be appropriated to the United States courts, out of any money in the treasury not otherwise appropriated, sums necessary to carry out the provisions of this section. When so specified in appropriation acts, such appropriations shall remain available until expended. Payments from such appropriations shall be made under the supervision of the director of the administrative office of the United States courts."?
Does not someone wonder how, also, this Court means to square, constitutionally, the mentioned amendments of Rule 785 with the legislative policy which appears in present section 16 of chapter 15 of our criminal code? The section (CL 1948, § 775.16), last amended by PA 1963, No 132 (Stat Ann 1965 Cum Supp § 28.1253):
"Sec. 16. Whenever any person charged with having committed any felony or misdemeanor not cognizable by a justice of the peace or magistrate and who appears before such justice of the peace or magistrate without counsel, and who shall not have waived examination upon the charge upon which he appears, such person shall be advised of his right to have counsel appointed for such examination, and if such person states that he is unable to procure counsel, the justice or magistrate shall notify the presiding judge of the circuit court in the jurisdiction of which the offense is alleged to have occurred, and upon proper showing the presiding judge shall appoint some attorney to conduct the accused's examination before a justice court or examining magistrate and to conduct the defense, and the attorney so appointed shall be entitled to *593 receive from the county treasurer on the certificate of the presiding judge that such services have been duly rendered, such an amount as the presiding judge shall in his discretion deem reasonable compensation for the services performed."[13] (Emphasis supplied by present writer.)
SUMMARY OF NOTES MADE DURING AND SINCE ORAL ARGUMENT
1. Until the Supreme Court speaks otherwise, I shall look upon the pertinent requirement of the Sixth Amendment and of our Constitution as being fully consistent with the petty offense exception made by the criminal justice act. Doing so, I follow the view other subordinate courts have taken when a Federal "forecast" is proposed. References to their actions in such regard may be found in footnotes appended below the following passage taken from the 3-judge determination of Moody v. Flowers (DC MD Ala), 256 Fed Supp 195, June 14, 1966 (p 200):
"It is not for us to forecast the likelihood that the Supreme Court will ultimately extend the principles of Reynolds v. Sims, 377 U.S. 533 (84 S. Ct. 1362. 12 L ed 2d 506), to the tens of thousands of subordinate *594 political units of the States to which have been delegated some power to which the label `legislative' may be attached. Some courts have essayed to do so, while others have been content to await the development of judicial standards in this comparatively uncharted area of constitutional law. A warning to make haste slowly may be read into refusal by the Supreme Court on two occasions to consider cases involving the contention that the Federal Constitution requires local governmental bodies below the State level be apportioned on a population basis."
The "two occasions" mentioned are Glass v. Hancock Co. Election Comm., 378 U.S. 558 (84 S. Ct. 1910, 12 L ed 2d 1035), and Tedesco v. Bd. of Supervisors of Elections for the Parish of Orleans, 339 U.S. 940 (70 S. Ct. 797, 94 L ed 1357).
2. No one should assume that the constitutional issue which divides us was overlooked either by the judicial conference of the United States or congress when the senate and house considered and adopted the criminal justice act. The senate stood steadfast for the restriction to felonies and misdemeanors other than petty offenses; whereas "The house version of the bill would cover all cases, including petty offenses," with the house managers insisting that "The constitutional mandate of the Sixth Amendment is without doubt applicable to petty offenses." Having said that, the managers went on to yield. See 2 U.S. Code Cong. and Adm. News 1964, pp 3002, 3003.
3. The judgment for which the civil liberties committee moves is not only extreme and immoderate; it is directly invasive of the prerogative which is vested with the legislative branch of Michigan's government. The connected text of that proposed judgment should be exposed again and again that everyone may realize the colossal supererogation *595 thereof. Here it is, copied from Justice SOURIS' contributed opinion:
"Our Constitutions and the United States Supreme Court's decisions cited compel the conclusion that appellate counsel and trial transcript must be furnished every indigent defendant entitled to an appeal as a matter of right. In this State that means every indigent convicted `in every criminal prosecution' (Art 1, § 20, Const of 1963), without distinction between those convicted of felonies, misdemeanors, circuit court misdemeanors or offenses cognizable by a justice of the peace."[14]
So Michigan is required, rather than permitted, to provide for those charged under her laws with petty offenses that which congress so far has refused to supply for those charged under Federal law with corresponding offenses. Not with my vote. I vote instead to affirm.
ADDENDUM (November 2, 1966):
The foregoing opinion was submitted to the other Justices September 29th. October 4th the Court directed the Chief Justice to "announce publicly that the amendment of GCR 1963, 785.3, made *596 August 24, 1966, is being reconsidered in light of objections made since publication." October 19th Justice SOURIS substituted for this case a new opinion for that which theretofore included the contextual and now deleted quotations appearing above (pp 588 and 595). Another development of intervening significance is the Supreme Court's denial (October 17th; 385 U.S. 907 [87 S. Ct. 207, 17 L ed 2d 137]) of certiorari to review Winters v. Beck, 239 Ark 1151 (397 S.W.2d 364).
In the Winters Case "an indigent Negro" was charged with a 30-day imprisonable petty offense. He was convicted without the aid of counsel (court-proffered or otherwise) and sentenced ultimately to nine and one-half months imprisonment.[15] The ruling of the Supreme Court of Arkansas was (p 1152):
"On the strength of Ark Stat Ann § 43-1203 (Repl. 1964), the courts of this State have always appointed attorneys to represent indigent defendants in felony cases. Thousands of misdemeanor cases are tried in the municipal courts of Pulaski county annually. In most of these cases the defendants are not represented by counsel. But petitioner contends that on the strength of Gideon v. Wainwright, 372 U.S. 335 (83 S. Ct. 792, 9 L ed 2d 799), it is now the duty of the courts to appoint attorneys for indigents in misdemeanor cases. We do not so construe Wainwright. There, the court was dealing with a felony case where the defendant had been sentenced to five years in the penitentiary. Here, the petitioner, Winters, had 30 days to take an appeal to the circuit court. He did not appeal, although the procedure for appealing from the municipal court is very simple. The services of an attorney are not required at all."
*597 Now it is quite true that the Supreme Court's refusal to review this decision by Arkansas constitutes no precedent either way (United States v. Carver, 260 U.S. 482 [43 S. Ct. 181, 67 L ed 361]). But it is equally true that such refusal is ink-fresh proof that the Supreme Court has not yet said and is not yet ready to say that the Sixth Amendment provides what Justice SOURIS and the aforesaid civil liberties committee aver in behalf of defendant Mallory.[16]
APPENDIX
The "Report of the ad hoc committee to develop rules, procedures and guidelines for an assigned counsel system" makes up a part of the report of a special meeting of the judicial conference of the United States held January 13, 1965. The latter report was transmitted to the speaker of the house by Chief Justice Warren January 25, 1965 (House document No. 62, iii). The ad hoc report presents in detail the legislative history of the criminal justice act and discloses the participation of the judicial conference in the requisite implementation thereof. It notes that the act requires assignment of counsel at the level of the office of the United States commissioner and, consequentially, that "in order to protect the record, courts and commissioners will be less inclined to accept waivers of counsel by defendants who appear before them." Summarizing (p 92) the ad hoc report concludes:
"In any case, it seems certain that the criminal justice act will require in the future a very large *598 increase in the number of counsel assigned to indigent persons accused of crime in the Federal courts."
Bearing in mind that the committees of the judicial conference at the time were attempting to formulate plans for carrying out the provisions of the criminal justice act, it is significant that the conference finally approved a budget of $7,500,000 for the first year's operation, conceding (p 80): "Thus the budget request is more than twice the $3,500,000 cost figure submitted by the attorney general."
All this relates, of course, to performance of duty under legislation designed to aid indigents charged with serious crime distinguished from petty offenses. As for the latter, we find in Lee Silverstein's Defense of the Poor, Volume 1 (ABA Foundation 1965), that there really is no way as yet to guess the appropriational cost of providing counsel for petty misdemeanants. Mr. Silverstein examines the problem in chapter 8 and reports (p 123):
"It is difficult to estimate the number of persons charged with misdemeanors in the United States each year. Only a few States publish reports on misdemeanors, and even these are lacking in uniformity because of differences in definitions and methods of reporting. Table 34 shows that the number of misdemeanors, not counting motor vehicle offenses, is very much larger than the number of felonies. The ratio ranges from about 4 times the number of felonies in Iowa to about 30 times the number in New Hampshire. The 12 States shown in this table had approximately 35% of the population of the United States in 1960, and 35% of all felonies in 1962. If the number of misdemeanors in this group of States is projected over all the States, then there were about 4,470,000 misdemeanor defendants in the United States in 1962, not counting defendants in motor vehicle cases. At the present *599 time, allowing for motor vehicle cases and for increases in misdemeanors since 1962, it seems fair to say that about 5,000,000 persons a year are charged with misdemeanors in the State courts."
SUPPLEMENTAL MEMORANDUM OF BLACK, J.
The day before this case was supposedly settled for signature and release of opinions (that day was November 10th), Justice SOURIS caused to be delivered to the undersigned 13 typed pages of additional changes of the opinion which presently carries his name at the masthead (supra, pp 560-577). Since the Court that morning faced a full day of hearing and conference upon docketed cases, and a final day of the November session for conference and decision upon a previously prepared judicial and administrative agenda, the timing of the aforesaid delivery was such that decision of People v. Mallory had to be held up again, this time by the writer. As Michigan lawyers interested in our doings have come to know, it is necessary that one compare with contemplative vigilance that which in quantity is tendered at the last minute as and for "amendments" of an opinion due for release. Witness Justice SOURIS' mournful admission, presently quoted, that he has "many times" signed an opinion "barely scanned" by him. Now to proceed:
In these November 10th amendments I find a highly personal suggestion that my judicial ethics are not up to the daintily professed standards of Justice SOURIS; a matter no man may let pass unnoticed. I find also in those amendments more than pertinent reason for full exposure of the whole background of that incredible folly of August 24th last; the arrant occasion when Justice SOURIS led a majority of the Court into the unwarned adoption[1]*600 of that which, under the angry pressure of an aroused judicial and professional opinion, the Court has since been compelled to renounce as all of us cast about now for some means of paling the Court's visage. I refer of course to the Souris-proposed amendments of GCR 1963, 785 (378 Mich xxxviii-xl); the amendments which, had they gone into effect this coming month as then ordered, would have crippled for all but nonindigent cases the enforcement of every Michigan ordinance and statute the design of which was and now is the punishment of "misdemeanors of minor gravity."[2]
Before proceeding further the following must be recorded. In an effort to avoid the forthcoming outdoor wash of our highly personal linen, the writer vainly moved to strike from Justice SOURIS' said opinion all of the personal gratuities appearing therein. The impertinence referred to will be found *601 on pages 561 and 562 supra, headed "In his current opinion Justice BLACK breaches that confidence." Had that motion received affirmative action this supplement would have been put back in briefcase for return to Port Huron and permanent suppression there. However, the motion having failed, it is time to be off to the fair.
Justice SOURIS is undoubtedly right if, as I glean from his presently alleged concern for the privacy of "views expressed by judges of an appellate court while deliberating upon their decisions," he has come finally to belief that this Court should adopt firm rules of personal and really nonpartisan conduct for observance by Michigan Supreme Court Justices. Sure it is that some but not all of us, seemingly forced by the fact of continued legislative failure to fully implement the so-called nonpartisan judicial amendment of 1939 (Const 1908 as amended, art 7, § 23; Const 1963, art 6, § 2), have not been able to eliminate either the outward appearance or the recorded appearance of typical party partisanship. So if this latest personal joust of two members of the highest Court of a State will result in the adoption and effective enforcement of comprehensively rigorous rules of Supreme Court conduct, applicable to all while they are outside as well as inside our alleged cloister of privacy, I indeed shall abide by them. In the meantime I mean not to cringe before one supported by some others who alleges on our record that he conducts himself with ethical purity and that the undersigned does not. Nor do I intend to abide rules of ethical conduct three of the Brethren would set for Justice BLACK which they by their recorded action regard not as binding upon themselves.
I would examine openly a few publicly recorded instances of judicial doings for array with Justice SOURIS' assumption of the vestments of holiness. I *602 do not recall, for instance, nor can anyone else, that any member of this Court challenged the ethical conduct either of Justice KELLY or the undersigned when, the occasion being Spoon-Shacket Company, Inc., v. County of Oakland, 356 Mich. 151, 157, 173, each of us previously quoted and then left in matter in the other's opinion which was subsequently deleted or "changed." Nor was there any objection when the writer listed, in Mosier v. Carney, 376 Mich. 532, 595, 596, our internal gyrations in that particular instance of fitfully irresolute overrulement. And especially do I recall that no one objected to the now irrevocably recorded quotation of and reliance by Justices SOURIS, KAVANAGH and SMITH upon certain of the minutes of our January 12, 1966 conference: a conference which preceded preparation of all but one of the several opinions of that most politically divisive case of all (Badgley v. Secretary of State [In re Apportionment of State Legislature 1965-1966], 377 Mich. 396, 465, 466, 469, 470). Verily, the Justices must have an ethical rule of conduct for themselves, and another more prim for such others as have the effrontery to challenge what they pushed through August 24th last.[3] Whatever the controversial fact thereof, let it be known that when Justices SOURIS, KAVANAGH and SMITH thus overtly breached what our Brother refers to as the "privacy of our deliberations," the undersigned for one warmly welcomed that act. Had there been any lingering doubt regarding the "privacy of our deliberations" then, what the 3 Justices did at the time made wholesome precedent for more revelation publicly of what goes on within.
*603 The above is by no means all. Throughout the judicial history of the United States one may search in vain for evidence that any high court judge, speaking out publicly of a suggested legislative measure not yet before his court for judicial test, has gone so far as to give forth a flat declaration of constitutional invalidity of that measure. There is one exception. It was committed in Michigan last March.
The Detroit News (March 3, 1966), headlining "Souris says `Stop-Frisk' Law is Unconstitutional," reported to the public (and to a manifestly startled profession):
"State Supreme Court Justice THEODORE SOURIS said last night that the proposed `stop and frisk' law for the State is unconstitutional. * * *
"Souris spoke at Grosse Pointe High School Annex Auditorium in a lecture series sponsored by the Grosse Pointe Democratic Club.
"The series, `The Constitution and the citizen,' covers the next three Wednesdays. Other guest speakers will be Circuit Judges Horace W. Gilmore and Joseph A. Sullivan and Detroit attorneys Avern Cohn and Theodore Sachs."
I make no comment now on this business of constitutional opinions ahead of submission. The Saginaw News subsequently (March 13, 1966) provided all that so far is necessary:
"Justice THEODORE SOURIS a week or so ago gave a talk before Grosse Pointe Democrats in which he bluntly said that a proposed `stop-and-frisk' proposal is unconstitutional.
"That's none of Justice SOURIS' business at this point in the game.
"The proposal had just been suggested. It is not being debated in the legislature. Most important it is not before the Supreme Court for study or opinion. Yet Justice SOURIS `killed' it."
*604 There is a silver lining in all this. Now that nigh to seven years will have elapsed since Justice SOURIS came to this bench by appointment,[4] it is something more than comforting to learn by his word, written unimpeachably on our official scroll in these waning days of December, that he too can and does err. Once the Justice was publicly blaming the Brethren for his "many" mistakes. See quotation below. Now the rest of us may relax a bit, reassured that all seated here are, after all, mere mortals; also that the last of Michigan's great nonpareils really did leave this bench when Justice FELLOWS died in harness July 16, 1929 (247 Mich. iii).
As for such "many" mistakes it is not difficult to recall that our Brother, complaining at the time about this Court's burdensome workload, surprised the annual (1961) conference of Michigan judges at Dearborn with this "inside" information headlined "High Court `Slipshod' in Work, Souris says" (Detroit News, September 28, 1961):
"What we are doing is dividing the cases eight ways, with the result that frequently the controlling decision is made by one justice with that decision receiving only cursory consideration by the seven others.
"I have many times signed my name to an opinion I have barely scanned and realized later that I had made a mistake. It makes you sick."[5]
One may well digress at this point to suggest that there must be a real and continuing danger in the *605 situation thus exposed at the Dearborn conference; a situation with respect to which this Court should have acted and now should act as soon as its personnel changes next month. There may indeed be a number of explosive time-bombs of hidden bad law ticking away in volumes 358, 359, 360 and 361 of Michigan Reports; the reports which necessarily contain the "many" opinions that made Justice SOURIS "sick." Those bombs should be ferreted out and disarmed immediately with the knowledgeable assistance of our Brother. He should know where those "many" mistakes are. As he doubtless will agree, any controlling opinion contained in those volumes, the effect of which made an apparently healthy Justice "sick" at the time, should receive correction by overrulement or sua sponte correction through a crash program; all else cast aside lest more lawyers and judges rely and act upon those opinions only to become "sick" themselves.
Now these quotations that are said to be a breach of confidence, an "implicit threat to the continued privacy of our deliberations," have not been released or exposed prior to decision day. Nor were they taken from any tentative "what do you think about this" memoranda, or from any probative draft such as we regularly circulate on white sheets. They came to us on our professionally-known "blues"; part and parcel of a constitutional "decision" to be released upon strength of whatever signatory support it might attract. Those blues had to be written against, with painstaking care, to avert if possible the kind of vote which the Court mistakenly as all now agree did record on August 24th. And they were challengingly before us, without amendment or declared prospect of withdrawal, when Justice SOURIS insisted that the Court vote *606 August 24th upon the aforesaid amendments of Rule 785.
To comprehend the "why" of our August 24th blunder the trial bench should have before it and now will have before it the complete conclusion of Justice SOURIS' aforesaid withdrawn opinion. See page 595, infra. And I cannot refrain from writing here that it is high time courts consider at greater length the "civil rights" of that great unnumbered multitude of law-abiding citizens and that constantly multiplying number of victims of today's fearsome crime wave. Everyone has civil rights; not just those who may be arrested and charged with crime or petty offense. This Rule 785 issue, bound up as it is with the Mallory and Copeland appeals, must continue to a Cannae-like showdown with all delicate perfume excluded from our internecive notes, opinions, and conversations.
So far as the writer is concerned there need be no misunderstanding of what has been, is now, and truly shall be. Everything turned in to the Court by him since January 1, 1956, everything that is has been written as if ultimately due for public examination. Right or wrong it may be quoted freely, any time. That is my ethical policy. And until we have rules of the kind outlined above, binding on all of us, it is going to stand. I conclude with these observations:
The Supreme Court of Michigan is not owned and possessed by the eight gentlemen who, berobed here in regal dignity, are seated as Justices for successively fleeting intervals of time. The Supreme Court of Michigan belongs to the people of that State. Its business is the people's business. And the more we conduct ourselves from within as well as without as if in an auditory glass bowl, the better will be our supposedly serviceable product.
*607 So the undersigned is implicitly threatening (he is the only one of course) "the continued privacy of our deliberations upon pending appeals." So be it until the constitutional supervisor of Michigan's "one court of justice" goes about policing all of the member-supervisors thereof.
O'HARA, J. (dissenting).
I agree with Mr. Justice DETHMERS that the appeal in this case is not dismissible as moot for the reasons he assigns and on the basis of the authority he cites.
I am not in agreement with the statement:
"These United States Supreme Court decisions, all involving felonies, may not necessarily be controlling of the question in the instant case relating to a misdemeanor."
Rather it is my position that they are not controlling for the somewhat obvious reason that in this State, by statute, felonies are not misdemeanors.
Thus, we are not mandated by any Federal case precedent to furnish indigent misdemeanants counsel at public expense.
However, in the interim between serving of Mr. Justice DETHMERS' opinion upon the other members of this Court and its release date, this Court, with Mr. Justice BLACK and myself dissenting, amended GCR 1963, 785 to include the furnishing of counsel to those charged with misdemeanors upon conviction for which the accused could be jailed for 90 days or more.
The vast majority of misdemeanors in this State are punishable by a jail sentence up to and including 90 days. These offenses are cognizable by justices of the peace and municipal courts. This latter becomes important because of an additional requirement in GCR 785. It provides in .4;
*608 "(1) Right to Timely Appeal. Hereafter, immediately upon sentencing, the court shall advise the defendant in open court that he is entitled as a matter of constitutional right to appellate review of his conviction and that, if defendant is financially unable to provide counsel to perfect such appeal, the court will appoint counsel for him and will furnish counsel with such portions of the trial transcript counsel requires to prepare postconviction motions and to perfect an appeal."
So long as GCR 1963, 785 was concerned with felonies, as it was prior to the amendment to take effect January 1, 1967,[1] no practical difficulty attended the enforcement of GCR 1963, 785.4(1). However, when misdemeanors, for which the accused could be jailed for 90 days or more, was added to GCR 1963, 785.3 and the right to such "portion of the trial transcript" as appellate counsel required became applicable to prosecutions in justices' courts and municipal courts, a practically unworkable situation was created. In countless justices' courts and municipal courts throughout Michigan, court reporters are not available. Neither do I believe can they be made available at whatever expenditure of public funds. There simply aren't that many. I take judicial notice of our regional judicial conferences of the past year, which were to some substantial degree devoted to the problem of obtaining sufficient court reporters for the circuit courts of the State and the recorder's court of Detroit.
I follow, therefore, my dissent from the adoption of the amendment to GCR 1963, 785, which includes in its terms misdemeanors, conviction for which the accused could be jailed for 90 days or more, with this dissent from Mr. Justice DETHMERS' opinion *609 that in all such foregoing prosecutions the accused is entitled to appellate counsel at public expense.
If the purist view is to be followed, then in every prosecution for an offense upon conviction for which the accused can be jailed at all, he has a right to counsel at public expense. I see nothing more sacred about 90 days than 10 days, or 1 day. If, however, it be said that this is a "practical matter" and that undiluted theory cannot obtain because the Bar simply can't furnish that many lawyers (to say nothing of reporters and the yet unmentioned amount of public expenditure), then I say a misdemeanor, upon conviction for which the accused can be jailed for 90 days or more, is a most unfortunate place to draw the line of "practicality."
I believe it the better part of wisdom to follow the Federal classification of offenses as provided in the Federal criminal justice act to which Mr. Justice DETHMERS makes reference in his opinion. This congressional enactment was preceded by study and research. It reflects, as I think it should, the legislative recognition of the necessity of representation of indigent defendants, within the limits of practicality. I therefore maintain my opposition to GCR 1963, 785.3 as proposed for adoption as of January 1, 1967.[2] I would recognize the "petty offense" classification as is done in the Federal act and provide counsel for the indigent accused of any misdemeanor except those "for which the penalty does not exceed imprisonment for a period of six months, or a fine of not more than five hundred dollars or both." (Federal criminal justice act, 18 USCA § 1.)
Specifically, I agree with Mr. Justice BLACK in his statement:
"Until the Supreme Court speaks otherwise, I shall look upon the pertinent requirement of the *610 Sixth Amendment and of our Constitution as being fully consistent with the petty offense exception made by the criminal justice act."
Despite the fact that the issue in this case is the appointment of appellate counsel only, I think the matter of appointment of trial and appellate counsel under GCR 1963, 785 are inextricably interwoven. In practical effect they cannot be treated separately. We would promote a high-stake judicial poker game at public expense to await the outcome of a trial for a misdemeanor where the accused is not furnished counsel and then provide him with appellate counsel and a transcript, or a portion thereof, and thus set in motion the machinery of appeal. What is even more incredible to me is to allow any of the courts of original jurisdiction over this class of offense to accept a plea of guilty without furnishing counsel, and then upon acceptance of such plea advise the pleader that he has an absolute right to appellate counsel and a transcript of the proceedings attendant the acceptance of his plea. We can't surely say to the counties of Michigan, this Court will not order you to supply indigents accused of misdemeanors coming within the rule trial counsel, but you must furnish to them appellate counsel and a transcript or portion thereof at public expense. So to do is to put the publicly-paid counsel cart before the horse.
The scholarly opinion of Mr. Justice SOURIS restates the obligation of those States which grant criminal appeals of right to afford "the indigent as adequate and effective appellate review as that given appellants with funds" under the equality clause of the Fourteenth Amendment.[3]
*611 This is settled law. It is not settled law in my view that the same obligation is imposed where the conviction is for a petty offense as defined in the Federal criminal justice act.
I would affirm the trial judge.
BRENNAN, J., took no part in the decision of this case.
NOTES
[*] CLS 1961, § 750.535 (Stat Ann 1965 Cum Supp § 28.803). REPORTER.
[1] 368 U.S. 52 (82 S. Ct. 157, 7 L ed 2d 114).
[2] 373 U.S. 59 (83 S. Ct. 1050, 10 L ed 2d 193).
[3] 316 U.S. 455 (62 S. Ct. 1252, 86 L ed 1595).
[4] See 373 Mich. xvi. REPORTER.
[1] "I concur in the judgment and opinion of the Court. But since it is contrary to an opinion which, as Attorney General, I rendered in 1940, I owe some word of explanation. 39 [US] Ops Atty Gen 504. I am entitled to say of that opinion what any discriminating reader must think of it that it was as foggy as the statute the Attorney General was asked to interpret. It left the difficult borderline questions posed by the Secretary of War unanswered, covering its lack of precision with generalities which, however, gave off overtones of assurance that the act applied to nearly every alien from a neutral country caught in the United States under almost any circumstances which required him to stay overnight.
"The opinion did not at all consider aspects of our diplomatic history, which I now think, and should think I would then have thought, ought to be considered in applying any conscription act to aliens. * * *
"Precedent, however, is not lacking for ways by which a judge may recede from a prior opinion that has proven untenable and perhaps misled others. * * * Baron Bramwell extricated himself from a somewhat similar embarrassment by saying, `The matter does not appear to me now as it appears to have appeared to me then.' Andrews v. Styrap (Eng), 26 LTRNS 704, 706. And Mr. Justice Story, accounting for his contradiction of his own former opinion, quite properly put the matter: `My own error, however, can furnish no ground for its being adopted by this Court,' United States v. Gooding, 12 Wheat (25 US) 460, 478 (6 L ed 693, 699). Perhaps Dr. Johnson really went to the heart of the matter when he explained a blunder in his dictionary `Ignorance, sir, ignorance.' But an escape less self-depreciating was taken by Lord Westbury, who, it is said, rebuffed a barrister's reliance upon an earlier opinion of his Lordship: `I can only say that I am amazed that a man of my intelligence should have been guilty of giving such an opinion.' If there are other ways of gracefully and good naturedly surrendering former views to a better considered position, I invoke them all." 340 U.S. 162, 176-178.
[2] CLS 1961, § 750.535 (Stat Ann 1965 Cum Supp § 28.803).
[3] Article 1, § 20 of our Constitution of 1963, effective January 1, 1964, the year of defendant's conviction, for the first time in the history of this State, guarantees the right of appellate review in all criminal cases. That section provides: "In every criminal prosecution, the accused shall * * * have an appeal as a matter of right * * * ". The significance of the foregoing, and the meaning given to the language by the delegates who drafted it, can be found in the Constitutional Convention's Address to the People, in which the people of this State were assured that:
"The clause, `to have an appeal as a matter of right' is added as a guarantee of the right of a defendant to at least one appeal in a criminal case. The provision is not intended to restrict the legislature in its power to provide by law for additional appeals." 2 Constitutional Convention Record 1961, p 3365.
Three weeks after the effective date of our 1963 Constitution, this Court belatedly amended our court rules to conform with the foregoing constitutional mandate. GCR 1963, 806.1 was amended on January 21, 1964 to read:
".1 Appeal of Right. In all criminal cases, defendant may appeal to the Supreme Court as a matter of right from any conviction in the circuit, superior, and recorder's courts within the time limited by subrule 803.1, unless the trial in such court followed a trial in a lower court or tribunal for the same offense."
At the same time, GCR 1963, 806.2 was amended to read:
".2 Appeal by Leave. Except as provided in subrule 806.1, all appeals to the Supreme Court shall be by leave."
[4] These statistics were supplied the author of this opinion by telephone on June 30, 1964, by Mr. Gus Harrison, director of the department of corrections, at the time the Court was considering adoption of subrule 785.4.
[5] Nor would such claim be tenable logically. Art 1, § 20, in its entirety, reads:
"Sec. 20. In every criminal prosecution, the accused shall have the right to a speedy and public trial by an impartial jury, which may consist of less than 12 jurors in all courts not of record; to be informed of the nature of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor; to have the assistance of counsel for his defense; to have an appeal as a matter of right; and in courts of record, when the trial court so orders, to have such reasonable assistance as may be necessary to perfect and prosecute an appeal."
The words "in every criminal prosecution", as used in the section, must mean the same thing when applied to each of the other rights granted by the section as it means when applied to the right of appellate review which the section grants. It is interesting to note the extreme position to which we are led, logically, by the argument that "in all criminal prosecutions" does not include misdemeanors among the cases in which the right of appellate review has been granted by the section. If "in all criminal prosecutions" does not include misdemeanors for that purpose, must not the phrase have the same meaning when the section grants to the accused the right "in every criminal prosecution * * * to a speedy and public trial by an impartial jury, which may consist of less than 12 jurors in all courts not of record"? Who among us would venture the suggestion that the people of this State intended to deny such fundamental rights to those accused of misdemeanors and imperiled thereby to a possible jail sentence of up to one year? Similarly, would anyone suggest, seriously, that when the section grants to the accused the right "in every criminal prosecution * * * to be informed of the nature of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor * * * " that the people did not intend that such rights apply to all misdemeanors notwithstanding their use of the phrase "in all criminal prosecutions"?
I doubt that anyone would. That leaves only the possibility, illogical though it be, that the phrase "in all criminal prosecutions" has a variety of meanings depending upon which of the rights granted in section 20 is being considered. I am reminded of the colloquy between Alice and Humpty Dumpty:
"`I don't know what you mean by "glory"', Alice said.
"Humpty Dumpty smiled contemptuously. `Of course you don't till I tell you. I meant "there's a nice knock-down argument for you."'
"`But "glory" doesn't mean "a nice knock-down argument"', Alice objected.
"`When I use a word,' Humpty Dumpty said, in rather a scornful tone, `it means just what I choose it to mean neither more nor less.'
"`The question is,' said Alice, `whether you can make words mean so many different things.'" Carroll, Through the Looking Glass, ch 6.
Indeed, that is the question.
[6] Mr. Ronald Dzierbicki, Clerk of the Court of Appeals, reported in a letter dated November 4, 1966 and addressed to the author of this opinion, which letter has been filed with the Clerk of this Court that the Court of Appeals has decided 42 discretionary criminal appeals from January 1, 1965 to November 1, 1966. The Court of Appeals reversed the convictions in 20, ordered hearings for determination of the voluntariness of confessions, per People v. Walker (On Rehearing 1965), 374 Mich. 331, in nine, dismissed appeal in six of the cases (in one of which the appeal was dismissed because the trial court granted the relief defendant was seeking on appeal) and affirmed seven. Of the 30 appeals in which appellant obtained relief (20 reversals, nine remands and one dismissal upon grant of relief by the trial judge), 24 involved indigent appellants represented by court-appointed appellate counsel, three involved appellants represented by retained counsel and three involved indigent [BAD TEXT] appearing in the Court of Appeals in pro se. Of the 12 appeals in which convictions were affirmed, five involved indigent appellant represented by court-appointed appellate counsel and seven involved appellants represented by retained counsel.
In the calendar year 1964, before the Court of Appeals commenced operation, the Supreme Court of the State of Michigan decided only seven criminal appeals fully submitted to the Court, in each of which defendant was represented by retained appellate counsel. See volumes 372, 373 and 374 of the Michigan Reports. In the same year, the Supreme Court summarily reversed only four convictions and ordered new trials where fatal defects appeared on the face of the record filed in support of applications for discretionary leave to appeal or for writ of habeas corpus. In none of these four cases was defendant represented by appellate counsel, but transcripts of the proceedings below, fortunately, were available to them and to us. The appellate records are available in our clerk's office. See No 50,772-1/2, Davis v. Calhoun County Circuit Judge, order entered March 4, 1964; No 50,812-1/2, In the Matter of Ash, order entered April 16, 1964; No 50,872-1/2, In the Matter of Inman, order entered July 9, 1964; and No 51,082-1/2, In the Matter of Rittenhouse, order entered November 6, 1964.
[*] Canfield v. Commissioner of Pardons and Paroles (1937), 280 Mich. 305, 309; Jurczyszyn v. Parole Board (1947), 316 Mich. 529.
[1] The Justice, emphasizing "all," was speaking to the text of review of a conviction for felony which resulted in a sentence "to serve five years in the State prison."
[2] Also in identically premised words by the 1835, 1850, 1908, and 1963 Constitutions of Michigan (1835, art 1, § 10; 1850, art 6, § 28; 1908, art 2, § 19; 1963, art 1, § 20).
[3] Certiorari granted January 17, 1966; 382 U.S. 971 (86 S. Ct. 532, 15 L ed 2d 464).
[4] Defendant Mallory was charged and convicted with having received stolen property "of the value of $100.00 or less," contrary to CLS 1961, § 750.535 (Stat Ann 1965 Cum Supp § 28.803). He was sentenced to and did serve a term of 90 days in the Detroit House of Correction. That was the maximum. CL 1948, § 750.504 (Stat Ann 1954 Rev § 28.772).
[5] Public Law 88-455, 88th Cong., Aug. 20, 1964; 18 USCA § 3006A.
[6] The expression is that of Justice ADAMS. He wrote (In re Apportionment of State Legislature 1964, 372 Mich. 418, 473):
"It [Justice SOURIS' interpretation] may well reflect the decision the United States Supreme Court will hand down any day now. When that day comes I will be pleased to join with him. Until it does, I do not conceive it to be the proper duty or function of this Court to attempt to outrun the Supreme Court of the United States."
These sensible sentiments seem to have been forgotten since April of 1964. See challenge and silence in Muskegon Prosecuting Attorney, ex rel. Schaub, v. Klevering, 377 Mich. 666, 672. Yet it remains constitutionally true that this Supreme Court of Michigan is, so far as concerns Federal questions, a subordinate Court. Its duty is to stand fast in honor of currently applicable Federal guidelines; not to guess that the Federal Supreme Court will lay down some contrary new rule of Federal law for retrospective application. It is better, say I, that a subordinate court risk direct reversal than risk indictment and conviction for having predicted by a soothsayer's judgment what ultimately does not come to pass.
[7] "Sec. 20. In every criminal prosecution, the accused shall have the right to a speedy and public trial by an impartial jury, which may consist of less than 12 jurors in all courts not of record; to be informed of the nature of the accusation; to be confronted with the witnesses against him; to have compulsory process for obtaining witnesses in his favor; to have the assistance of counsel for his defense; to have an appeal as a matter of right; and in courts of record, when the trial court so orders, to have such reasonable assistance as may be necessary to perfect and prosecute an appeal."
[8] See cases and quotations appearing in Bacon v. Kent-Ottawa Metropolitan Water Authority, 354 Mich. 159, and Lockwood v. Commissioner of Revenue, 357 Mich. 517, 565-570.
[9] See cases cited in 10 Words and Phrases, Criminal Prosecution, p 536 et seq. and 1966 pocket supp pp 176-178; also In re Cox, 129 Mich. 635, holding that the constitutionally guaranteed right of trial by jury does not extend to prosecutions under local ordinances. At 637 the Court said:
"This Court has held that cases under municipal ordinances proper do not rise to the dignity of criminal proceedings, and that neither a writ of error nor exceptions before sentence would lie. (Citing cases.) In this connection, see People v. Vinton, 82 Mich. 39, 45; Village of Northville v. Westfall, 75 Mich. 603."
[10] Both briefs (for Mallory and Copeland) declare the claimed constitutional right in these words:
"Whenever there is the possibility that an indigent defendant will be deprived of his liberty for as much as one day, he is entitled to be informed of his right to be provided with counsel and, moreover, to be provided with competent counsel, unless he intelligently waives such right."
[11] This recommendation and comment was indorsed by the signatures of present "Of Counsel" for both appellants (Mallory and Copeland).
[12] See appendix for discussion of cost in conjunction with the report of the "Ad Hoc Committee" of the Judicial Conference of the United States.
[13] Norris and Hammond refer to this section as being "The heart of the assigned counsel system." 42 U of D Law Journal 397, p 407, April 1965. They go on to recommend (p 428):
"3. Michigan General Rule 785 should be amended to cover all felonies and all misdemeanors punishable by confinement or imprisonment for one year or more. This is in accord with the present practice of most of the circuits, particularly since the adoption of the assigned counsel system of 1963."
It is interesting to note that Professor Norris, "as a delegate to Michigan's Constitutional Convention, was the author of the provision creating a constitutional right of appeal." (p 429.) The provision thus authored is the same section 20 upon which, along with the Sixth Amendment, Justice SOURIS relies for reversal.
Emphasis of the "one year or more" limitation, appearing in the Norris and Hammond recommendation above, is also supplied by the present writer.
[14] (September 29, 1966): This is the way such connected text reads at present. When the Court's majority considered and adopted the amendments of Rule 785 Justice O'HARA and the writer opposed on August 24th, the connected text of such proposed judgment went sled length, reading this way:
"Our constitutions and the United States Supreme Court's decisions cited compel the conclusion that appellate counsel and trial transcript must be furnished every indigent defendant entitled to an appeal as a matter of right. In this State that means every indigent convicted `in every criminal prosecution' (Const 1963, art 1, § 20), without distinction between those convicted of felonies, misdemeanors, circuit court misdemeanors, offenses cognizable by a justice of the peace or offenses against village or city ordinances."
Wording the allegation of constitutional law either way, the resultant question cannot be evaded. It is whether any constitutional provision requires that Michigan provide in the context of these Mallory-Copeland appeals more than her legislature already has by PA 1963, No 132, amending CL 1948, § 775.16 (Stat Ann 1965 Cum Supp § 28.1253).
[15] On account of subsequent application of Arkansas' "dollar-a-day" statute. As to this, see Justice Stewart's dissent from denial of certiorari, 385 US at 907.
[16] (December 12, 1966). There can be little question about this now. December 5th last the Supreme Court denied certiorari to review petitioner De Joseph's conviction of the Connecticut misdemeanor of criminal nonsupport and consequent sentence to six months in jail. For the facts, see Justice Stewart's dissent from such denial with pointed reference to Winters v. Beck. De Joseph v. Connecticut (1966), 385 U.S. 982 (87 S. Ct. 526, 17 L ed 2d 443, 444).
[1] No notice was given pursuant to GCR 1963, 933. No publication in the State Bar Journal was made beforehand. And no pretense of "finding of a need for immediate action" was then made or is made now.
[2] Consider, with forbearance, the Court's "Press Release" of October 6, 1966 (45 MSBJ, No. 10, p 33):
"The Supreme Court announced today, through Chief Justice THOMAS M. KAVANAGH, that the Court is reconsidering the amendment of GCR 1963, 785.3, made August 24, 1966, in light of the objections made since its publication. The rule refers to the question of appointment of counsel and other procedures in ordinance cases in justice of the peace and municipal courts. The Court will continue its reconsideration at its November 1966 conference;"
and then our most recent order, due at this writing for publication in the advance sheets and Michigan State Bar Journal:
"On Order of the Court dated November 16, 1966 (Chief Justice T.M. KAVANAGH and Justices DETHMERS and SOURIS dissenting), the effective date of amendments to GCR 1963, 785, appearing in volume 378 Michigan Reports, at pages xvii-xxii of part 3, Advance Sheets, is suspended until further notice. The bench and profession are advised that the Court has Rule 785 under consideration for further revision and that, until such revision is drafted and placed in effect, subrule 785.3, as it read prior to the amendments of August 24, 1966, shall continue to be applied, subject, however, to the requirements of CL 1948, § 775.16, as amended by PA 1963, No 132 (Stat Ann 1965 Cum Supp § 28.1253)."
[3] The moral of an old fable comes to mind here; the fable of the lawyer, the farmer and the farmer's ox, aptly found in "The Partial Judge." For source reference, see Bartlett's Familiar Quotations (Morley's 1947 ed.), p 1139. It does make a difference whose ox is being gored.
[4] January 5, 1960; 358 Mich. iii.
[5] Now I for one will not admit that any indorsement of mine has been appended to any "barely scanned" opinion. Too many beartraps lurk in that kind of negligence. Nor have I been made sick distinguished from hindsight regretful on account of anything which, since January 1, 1956, has recorded my indorsement. I have on occasion conceded (on our record; not elsewhere) that some indorsements should have been qualified in some specific regard. The most recent example appears in Currie v. Fiting, 375 Mich. 440 at 477, 478.
[1] By subsequent action, this Court postponed the effective date of this Rule and has published a proposed revised version thereof under GCR 1963, 933 inviting further comment by bench and bar.
[2] See footnote 1.
[3] Draper v. Washington (1963), 372 U.S. 487 (83 S. Ct. 774, 9 L ed 2d 899). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580886/ | 919 F. Supp. 1272 (1996)
CIRCLE R, INC., a Nebraska Corporation, Plaintiff,
v.
SMITHCO MFG., INC., an Iowa corporation, and Greg Smith, an individual, Defendants.
No. C 96-4002.
United States District Court, N.D. Iowa, Western Division.
March 20, 1996.
*1273 *1274 *1275 *1276 *1277 Dennis L. Thomte of Zarley, McKee, Thomte, Voorhees & Sease, Omaha, Nebraska, for Plaintiff Circle R, Inc.
G. Brian Pingel of Sherer, Templer, Pingel & Kaplan, P.C., West Des Moines, Iowa, and Richard H. Moeller of Berenstein, Moore, Moser, Berenstein & Heffernan, Sioux City, Iowa, for Defendants Smithco Mfg., Inc., and Greg Smith.
MEMORANDUM OPINION AND ORDER REGARDING PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION
TABLE OF CONTENTS
I. INTRODUCTION AND BACKGROUND ...................................... 1278
A. Procedural Background ......................................... 1278
B. Factual Background ............................................ 1280
II. LEGAL ANALYSIS ................................................... 1286
A. Standards For Preliminary Injunctions In Patent Cases ......... 1287
1. Factors in the analysis .................................... 1287
2. Relationship of the factors ................................ 1288
3. Provisional determinations ................................. 1289
B. Individual Factors And Their Application ...................... 1289
1. Likelihood of success on the merits ........................ 1289
a. Validity ............................................... 1289
i. The "on-sale" bar ................................. 1290
ii. "Obviousness." .................................... 1294
iii. Inventorship ...................................... 1294
iv. Inequitable conduct ............................... 1295
b. Infringement ........................................... 1295
i. Literal infringement .............................. 1297
ii. "Doctrine of equivalents." ........................ 1297
2. Irreparable harm ........................................... 1300
a. Availability of a presumption ........................... 1300
b. When the presumption is not available ................... 1301
3. Balance of harms ........................................... 1303
4. Public interest ............................................ 1304
III. CONCLUSION ........................................................ 1304
BENNETT, District Judge.
A motion for a preliminary injunction in a patent infringement case often involves the court in a precarious balance of presumptions, inferences, and equitable concerns based on only a thinly developed record and preliminary findings of fact and conclusions of law, all in the interest of forestalling irreparable harm and maintaining the status quo. Although the court's preliminary determination is subject to ultimate revision following trial on the merits, if the question of whether or not to issue a preliminary injunction is wrongly decided at this nascent stage of the proceedings, the court's preliminary determination may inflict as much irreparable harm as it forestalls. In this case, the court must consider how far presumptions will carry the plaintiff patentee in its demand for a preliminary injunction to enjoin production of allegedly infringing side-dump semi-trailers. Specifically, the plaintiff has invoked the presumptions of patent validity and of irreparable harm if a preliminary injunction is not issued to enjoin sales of the allegedly infringing side-dump trailers made by defendants. Defendants have countered these presumptions with evidence they contend shows neither presumption can properly stand, because the patent is neither valid nor infringed. The court here enters the ruling on plaintiff's application for a preliminary injunction the court concludes will best serve to prevent irreparable harm and to maintain the status quo.
*1278 I. INTRODUCTION AND BACKGROUND
A. Procedural Background
Plaintiff Circle R, Inc., filed this patent infringement action on January 5, 1996, against defendants "The Smith Co." and "Gregg Smith," asserting that defendants are infringing Circle R's patent for a side-dump trailer.[1] Defendants answered the complaint and asserted a counterclaim on January 29, 1996. In their answer, defendants asserted, inter alia, that the corporate defendant had been incorrectly titled by Circle R, and that the company's name is properly Smithco Mfg., Inc. Following a hearing on plaintiff's motion for a preliminary injunction, the court entered an order granting the parties' oral request to amend the caption in the case to identify the defendants properly as "Smithco Mfg., Inc.," and "Greg Smith." The defendants will therefore be referred to herein collectively as "Smithco," except when individual acts or statements of Mr. Smith are under discussion.
Leaving nomenclature aside, and returning to more significant matters, Circle R's complaint alleges that Circle R is the owner of United States Patent No. 5,480,214 (hereinafter, "the '214 patent"), entitled "SIDE DUMP TRAILER," and that Smithco is infringing one or more claims of that patent by manufacturing, marketing, and selling truck and/or trailer bodies covered by the '214 patent. Jurisdiction over the complaint is asserted under 28 U.S.C. ง 1338 (patent jurisdiction). The complaint asserts that the '214 patent is valid and enforceable, that Smithco is literally infringing the patent-in-suit, that infringement by Smithco is "willful," and that Circle R is entitled to a permanent injunction against such infringement, whether direct, contributory, or by inducement. The complaint seeks damages adequate to compensate Circle R for infringement of its patent that are in no event less than a reasonable royalty, plus interest and costs, enhancement of damages up to three times the amount assessed as the result of the asserted "willfulness" of the infringement, payment of costs and attorneys fees, and such other relief as the court deems just and equitable.
On January 18, 1996, Circle R also moved for a preliminary injunction "enjoining Defendants and their servants and agents from manufacturing, using or selling side dump trailer bodies which infringe one or more claims of U.S. Patent No. 5,480,214." Circle R attached to its application for a preliminary injunction various "evidentiary materials," including photographs of an allegedly infringing trailer made by Smithco and a copy of the '214 patent. Circle R also attached an affidavit of its patent expert, registered patent attorney John A. Beehner, stating his opinion that the Smithco side-dump trailer infringes each limitation of claims one and two of the '214 patent, and an affidavit of Ralph Rogers, the President of Circle R and the named inventor of the '214 patent, in which Mr. Rogers describes a purported business partnership with Greg Smith of Smithco, breach of that partnership arrangement, and subsequent infringement of Circle R's patent by Smithco.
In the brief in support of its motion for a preliminary injunction, Circle R argues that Smithco's trailers literally infringe each and every limitation of at least claims 1 and 2 of the '214 patent, and that Smithco has no right whatsoever to make, use, or sell such trailers. Circle R also argues that the hardship to it of not issuing a preliminary injunction is the impingement of its limited-in-time property right to exclusivity under the patent, while any hardship to Smithco of such an injunction, which is a result of Smithco's election to build a business on an infringing product, should be disregarded. As to likelihood of success on the merits, Circle R relies on both its expert's opinion that Smithco is infringing the patent and the presumption of validity of United States patents. A further presumption figures in Circle R's assertion of irreparable harm, in that it contends that "irreparable harm is presumed when a clear showing has been made of patent validity and infringement." Plaintiff's Memorandum In Support Of Its Motion For A Preliminary *1279 Injunction, p. 9 (citing H.H. Robertson Co. v. United Steel Deck, Inc., 820 F.2d 384, 390 (Fed.Cir.1987), overruled on other grounds, Markman v. Westview Instruments, Inc., 52 F.3d 967, 977 (Fed.Cir.1995)). Circle R also contends that the public interest favors enforcement of patent rights, and therefore all pertinent considerations favor the grant of a preliminary injunction in this case.
On January 29, 1996, Smithco answered Circle R's complaint, asserting both affirmative defenses and a counterclaim to the effect that the '214 patent is invalid and unenforceable. Specifically, in its affirmative defenses, Smithco contends that the '214 patent has been "anticipated" under 35 U.S.C. ง 102, that it is "obvious" under 35 U.S.C. ง 103, and that the inventorship of the '214 patent has been misrepresented to the Patent and Trademark Office (PTO) in violation of 35 U.S.C. ง 116. Smithco contends that the co-inventor of the patent is Joe Garthright, an employee of Smithco, and that Smithco has an implied license to a shop right to make, use, or sell the alleged invention in the patent. In its counterclaim, Smithco reasserts the allegations in its affirmative defenses, arguing that the '214 patent is invalid and unenforceable, and that Ralph Rogers is not the sole inventor of the patent, but that he was instead assisted in developing the alleged invention by Joe Garthright, who is therefore a co-inventor of the patent. As relief on its counterclaim, Smithco seeks a declaration that the '214 patent is invalid and/or not infringed by Smithco, that the patent is unenforceable, and that Joe Garthright is a co-inventor of the patent. Smithco further seeks award of its costs and attorneys fees, as well as such other relief as may appear equitable and just in the circumstances. Circle R replied to the counterclaim on February 2, 1996, denying all allegations upon which the counterclaim depends.
Smithco did not immediately resist Circle R's motion for preliminary injunction, but instead sought an extension of time to do so on February 2, 1996. That motion for an extension of time was granted on February 3, 1996, granting Smithco to and including March 4, 1996, within which to respond to the motion for preliminary injunction. Smithco's resistance to the motion for preliminary injunction was subsequently timely filed on March 4, 1996. With its resistance, Smithco filed photographs of three side-dump trailers purchased by Greg Smith's trucking company, Smith Trucking Company, from Circle R in 1992 and 1993, purportedly indicating, among other things, the maximum degree of pivot each achieves when dumping, a purchase agreement for one of these trailers, dated October 18, 1993, as well as photographs of two trailers recently produced by Smithco, again showing their degree of dumping pivot. Smithco also provided the affidavits of Greg Smith, Joe Garthright, who is the manager of Smith Trucking, and Smithco's patent expert, registered patent attorney Kent A. Herink.
In its resistance, Smithco argues that a preliminary injunction would not maintain the status quo in this case, but would instead completely disrupt Smithco's business, which is solely the making and selling of side-dump trailers of its own design. Smithco also argues that there is no credible evidence of likelihood of success on the merits, because the '214 patent has never been tested in litigation. Smithco contends that the '214 patent is invalid under the "on-sale" bar found in 35 U.S.C. ง 102(b), because the alleged invention of the patent was on sale in this country, indeed, was sold to Greg Smith's trucking company, Smith Trucking, by Circle R, more than one year prior to the date of the application for the '214 patent. Furthermore, Smithco contends, the '214 patent is obvious under prior art disclosed in prior patents. Smithco contends that the patent is invalid, as well as unenforceable, for a third reason, which is that the patent application violated 35 U.S.C. ง 116 by failing to disclose that Joe Garthright was a co-inventor of the alleged invention and failing to name Mr. Garthright as a co-inventor. Smithco also contends that the patent is unenforceable owing to inequitable conduct during the patent application and prosecution process, because Circle R and Rogers never advised the PTO of the sale of the three prior art trailers to Smithco.
Smithco also attacks Circle R's allegations of infringement as well as Circle R's assertions *1280 of validity and enforceability. Smithco contends that its side-dump trailers do not literally infringe Circle R's patent, if valid, because the Smithco trailers employ a pivot of more than ninety degrees from their non-dumping positions, while the patent specifically states that it employs a pivot of not more than ninety degrees. Smithco contends further that Circle R is estopped from asserting infringement based on the "doctrine of equivalents," because it distinguished prior art during the prosecution of the patent on the basis that the prior art employed a pivot in excess of ninety degrees. Thus, because there is no valid patent and no infringement if the patent is valid, Smithco contends there can be no adequate showing of likelihood of success on the merits and no presumption of irreparable harm. Furthermore, Smithco contends that the balance of harms favors its continued operation, and the public interest does not favor an injunction in circumstances involving no valid patent and no infringement.
Circle R's motion for preliminary injunction was heard on March 13, 1996. At the hearing, plaintiff Circle R was represented by counsel Dennis L. Thomte of Zarley, McKee, Thomte, Voorhees & Sease, in Omaha, Nebraska. Defendants Smithco and Greg Smith were represented by counsel G. Brian Pingel of Sherer, Templer, Pingel & Kaplan, P.C., in West Des Moines, Iowa, and Richard H. Moeller of Berenstein, Moore, Moser, Berenstein & Heffernan, in Sioux City, Iowa.
Prior to the hearing, on March 12, 1996, Circle R mailed a motion to opposing counsel and the court, which was filed March 15, 1996, to strike evidentiary materials filed by defendants in support of their resistance to the motion for a preliminary injunction. In that motion, Circle R contends that there is no adequate foundation laid for introduction of the photographs of the first three trailers sold by Circle R to Smith Trucking, because there is no affidavit from any person present during the photographing. Circle R contends that the photographs are also irrelevant, because they do not show that the trailers in question were positioned on level ground and do not show the degree of pivot of the trailers relative to the frame. Circle R also argues that the photographs are irrelevant, because they do not explain purportedly obvious modifications to the dumping configuration of the trailers as the result of repairs or replacements of parts, which, Circle R contends, would change the degree of dumping pivot of the trailers.
Also prior to the hearing, on March 12, 1996, Circle R mailed a reply brief to opposing counsel and the court, which was filed March 15, 1996. In that reply brief, Circle R argued, as it had for the first time during the hearing, that the sales of trailers by Circle R to Smith Trucking more than one year prior to the patent application were "experimental" sales, that neither trigger the "on-sale" bar of 35 U.S.C. ง 102(b), nor any duty of disclosure to the PTO. At the hearing and by subsequent written order, the court granted Smithco's oral request for leave to respond to the new "experimental sales" arguments. The court received a courtesy copy of Smithco's further response brief by facsimile on March 15, 1996, and a copy was subsequently filed with the clerk of court by mail on March 18, 1996.
The court now turns to the factual background provided by the parties' written submissions and the evidence presented at the March 13, 1996, hearing.
B. Factual Background
The parties tell quite different stories about the circumstances under which each company that is a party here began making side-dump trailers, the relationship among Circle R, Greg Smith, and Smithco, and the circumstances that led to the invention of the '214 patent. Circle R is a Nebraska corporation with its principal place of business in South Sioux City, Nebraska. Its president is Ralph Rogers. In his declaration in support of the motion for preliminary injunction, Rogers stated that prior to March of 1994, Circle R designed, developed, and, on a limited basis, manufactured side-dump trailers, one or more of which were purchased by Greg Smith. Rogers stated that owing to Greg Smith's interest in the side-dump trailers he had purchased from Circle R, Smith approached Rogers in March of 1994 about forming a partnership *1281 to make and sell trailers on Rogers' new design. Rogers contended that he and Smith formed a partnership on March 26, 1994, to design, manufacture, and sell side-dump trailers, in which Rogers contributed his designs, and Smith provided capital. Rogers did not produce any partnership agreement as an exhibit in the litigation of this motion for preliminary injunction, either by attachment to Circle R's complaint or the motion for a preliminary injunction, or as an exhibit at the hearing before this court. In his declaration, Rogers contended that Smith breached the partnership agreement, and instead has been producing trailers that infringe one of Rogers' patents at Smith's trailer manufacturing company in LeMars, Iowa.
In his responsive declaration, Smith contended that no such partnership was ever formed and that the issue of whether any such partnership exists or ever existed has been foreclosed by judicial proceedings in Nebraska state court in Dakota County, Nebraska, in which judgment was entered in Smith's favor. However, Smith has not identified the proceedings further nor produced a copy of the judgment from those proceedings. At the evidentiary hearing on the motion for preliminary injunction, Rogers did not reassert his argument that he and Smith had been partners in a business to manufacture side-dump trailers. Whether he had or not, the court need make no finding concerning this dispute, not even a preliminary one, because it is collateral to the question presently before the court, which is whether a preliminary injunction should issue to enjoin patent infringement. The court points out these different views concerning the relationship between Rogers and Smith as background to the question of who invented the device patented as the '214 patent.
Of more immediate pertinence is the content of the '214 patent, itself. Rogers applied for a patent for a "SIDE DUMP TRAILER" on October 20, 1994. A patent was issued on January 2, 1996, as United States Patent No. 5,480,214. The invention identified in the patent consists of a trailer bed, or tub, that can dump to either side by means of hydraulic arms mounted on either end of a frame and connected to the ends of the tub, causing the tub to pivot one way or the other, depending on which pair of corner pivots has been released from its pivot points, and which pair remains locked in place, thus serving as pivots when the tub dumps to the side. Principally at issue in this litigation are claims 1 and 2 of the '214 patent. Claim 1 of the patent[2] describes the *1282 principal inventions of the patent. The final limitation of claim 1 is perhaps the most critical to the question of any infringement of the '214 patent in this case. It provides as follows:
the angular relationship of said side walls with respect to said bottom wall, together with the relationship of said pivot pins with respect to said side walls and said bottom wall, enabling the material in said body to be dumped therefrom, when positioned in its dumping positions, without the necessity of pivotally moving said body greater than 90ฐ from its non-dumping position.
U.S. Patent No. 5,480,214, claim 1, final paragraph (emphasis added). Claim 2 of the patent,[3] which is derivative from claim 1, and therefore a "dependent" claim, pertains to the locking devices for each pivot point. Rogers was listed as the sole inventor on the patent application, and is listed as the sole inventor on the patent as issued. Rogers stated in his declaration that he assigned all rights in the '214 patent to his company, Circle R. Circle R contends that trailers now being made by Smithco literally infringe each and every limitation of at least claims 1 and 2 of the '214 patent.
Greg Smith has a different version of the circumstances under which the invention of the '214 patent was conceived. Smith stated, in both his declaration and in testimony before the court, that during April or May of 1992, he became dissatisfied with side-dump trailers then available from another supplier, Bailey Engineering and Manufacturing Company (BEMCO), used by his trucking company, Smith Trucking, in hauling and dumping rock, sand, gravel, dirt, and other materials. The manager of Smith Trucking, Joe Garthright, became involved in trying to improve the design of such trailers. The problems Mr. Garthright identified with the BEMCO trailers, which BEMCO declined to address, included breaks in electrical and hydraulic lines, hydraulic cylinders which were sometimes opened up during the dumping process, cracking of support structure for hinges of the tub body, and difficulties with unhooking the trailers from the associated tractor.
Garthright and Smith therefore approached Circle R to see if it would be interested in producing trailers that met their requirements. According to both Garthright and Smith, Garthright specifically explained to Rogers that the trailers should be built with a light, stiff frame that would *1283 provide room to anchor the hoses, the hydraulic cylinders for the tub body should be larger, and the trailer should have a king pin with a fifth wheel on the tractor for hitching the tractor and trailer together.
Rogers specifically contradicted this testimony in his own testimony at the preliminary injunction hearing. Rogers testified that Garthright brought him only "problems," but suggested no "solutions." Rogers testified that at some point Smith suggested they might be able to use an old trailer frame from an end-dump trailer for a new side-dump trailer, but that he could not recall whose idea it was to use a frame as part of the design. Testimony from witnesses for both sides, however, indicated that frames under side-dump trailers were not an entirely new innovation, as a side-dump trailer Garthright had seen in North Dakota in 1991 or 1992 employed such a frame. From uncontradicted testimony at the hearing, however, it was shown that the BEMCO side-dump trailer does not use such an underlying frame, but instead is based on log carriers that use no frame. Although he contradicted Garthright's assertions of co-inventorship of the side-dump trailer patent at issue here, Rogers conceded at the hearing that he would not have started making side-dump trailers but for the suggestion that he build such trailers for Smith Trucking. However, at this stage of the proceedings, the court is unwilling to find that Garthright's design suggestions, if made, were necessarily material to the patentable aspects of the invention embodied in the '214 patent.
The disputes about co-inventorship aside, for the moment, it is undisputed that Circle R built a trailer for Smith Trucking during the summer of 1992, which was delivered in August of 1992, that incorporated various new features to address the problems Smith Trucking was having with its BEMCO trailers. Smith presented testimony and photographic evidence that the angle of pivot of this truck is eighty-nine or ninety degrees from its non-dumping position. Although counsel for Circle R may have succeeded in undermining the weight of the photographic evidence concerning this and the other two trucks Smith Trucking purchased from Circle R in 1992 and 1993,[4] Smith's testimony that an angle of pivot of not more than ninety degrees for this first truck, as purportedly shown in the challenged photographs, was "consistent with his experience" during the years in which Smith Trucking used the trailer is sufficient to raise a substantial question as to whether the trailer indeed pivoted not more than ninety degrees while in the fully dumped position. Mr. Smith's testimony was based on his recollection that this particular trailer did not dump "cleanly" when soft, damp, or fine aggregates, such as dirt or sand, were dumped, and further measures, such as "bouncing" the tub, had to be taken to remove the last of the load in such cases.
Smith Trucking bought two more trailers from Circle R during 1992 and 1993. The second trailer purchased by Smith Trucking was delivered on October 9, 1992, and the third, ordered on October 18, 1993, was delivered on October 26, 1993. Smithco entered into evidence a Nebraska Vehicle Purchase Contract for this third trailer, dated October 18, 1993, showing a purchase by Smith Trucking from Circle R of this third side-dump trailer for $22,987.00, with a down payment of $5,000.00. Defendants' Exhibit D. Smithco asserts that these three trailers purchased by Smith Trucking from Circle R in 1992 and 1993, and all ordered more than *1284 one year prior to the filing of the application for what became the '214 patent, resemble the '214 patented invention in almost all respects.
Smithco's expert witness, Kent Herink, opined that every limitation of the first claim of the patent "reads on" the first two, but not the third, of these trailers purchased by Smith Trucking from Circle R in 1992 and 1993. Mr. Herink testified that the third trailer failed to meet the final limitation of claim 1, which is the limitation that the dumping pivot not exceed ninety degrees from the tub's non-dumping position. The degree of dumping pivot of the second truck as shown from testimony and photographic evidence is eighty-five degrees from its non-dumping position. Again, Smith testified that this dumping angle was also consistent with his experience, because, while the first trailer appeared to be almost straight up and down when in the fully dumping position, the second trailer appeared to be slightly short of the vertical. Smith testified that the third trailer purchased from Circle R, however, visibly exceeded a ninety-degree pivot when fully dumping. No photographic evidence of the dumping angle of this third trailer was presented at the hearing.
Although Smith testified that all three of these trailers purchased from Circle R during 1992 and 1993 had been subjected to various repairs, made either by Circle R or by Smith Trucking or a repair shop selected by Smith Trucking, Smith asserted that none of these repairs would have changed the dumping pivot of the trailers. Specifically, Smith testified that there had been no changes to the components constituting the dumping configuration of the second trailer, and any changes to the hydraulic cylinders that actually dump the trailer tub on the first trailer had been made to replace exactly the prior configuration. Therefore, on the first trailer, the "ram" of a replacement cylinder had to be cut-off, as Rogers had originally done, to shorten the "stroke" of the cylinder, and maintain the prior maximum dumping pivot. Smith also testified that no repairs to the third trailer had changed its dumping configuration and maximum dumping pivot.
It is undisputed that Rogers' application for what later became the '214 patent did not include any disclosure of the sale of these three trailers to Smith Trucking made more than one year before the date of the patent application, that is, more than one year prior to October 20, 1994. For the first time at the hearing, Circle R suggested that the sale of these first three trailers had been "experimental." Rogers testified that he did not know if these trailers would "work," although he had a "good idea" that they would, and that he had no idea whether they reflected a "marketable" design or would stand up in service. Rogers conceded that there was no written or oral agreement that Smith Trucking would "test" the trailers and report back on their performance, and that there was no restriction on the resale of the trailers or any requirement that they be kept "secret" from the public. His assertion that the trailers were "experimental" was that he decided when he built them that if they worked, he would build and sell them. Rogers also asserted that the sale prices of the trailers, $19,000, $20,000, and $23,000, when the trailers now sell for $34,000, was a price break or monetary incentive to Smith Trucking to try the design for him, but he conceded that there is no sale document reflecting such a "price reduction" or such a reason for any price reduction.
Against this assertion of "experimental" sales, Smith and Garthright testified that there were no restrictions on resale, no conditions of any kind on the sales, and no price reduction for trying an experimental design. They further testified that Rogers neither required nor requested that they provide him with any feedback on the performance of the trailers. Rather, they testified that they had great difficulty in interesting Rogers or any other Circle R representatives in problems they encountered from time to time with the trailers. Although Circle R made some of the repairs to the trailers from time to time, Smithco and other repair shops also made repairs, often, Smith testified, because Circle R was not interested in fixing problems with the trailers. Smith testified that Smith Trucking insisted that the third trailer purchased from Circle R use stock parts for the cylinders, rather than the cut-off rams used *1285 by Circle R on the cylinders for the first two trailers, so that repair and replacement could be done more cheaply and easily.
With the testimony of Joe Garthright, the former manager of Smith Trucking, the court must return to the question of the "co-inventorship" of the '214 patent. Garthright testified that Rogers' son, Kevin, suggested that Circle R should pay Garthright $500.00 for every side-dump trailer Circle R sold for bringing Circle R his ideas for the side-dump trailer. Garthright testified that on one occasion, Kevin repeated this suggestion in front of Rogers, who agreed. Garthright testified that he has received two such $500.00 payments from Circle R as the result of sales of Circle R side-dump trailers to customers other than Smith Trucking. Thus, Smithco contends, Garthright is a co-inventor of the '214 patent, and that Rogers has acknowledged as much. Rogers testified that the $500.00 payments were "finders fees" for bringing customers for side-dump trailers to Circle R. However, Garthright testified that he had never had any direct contact with the customers of the trailers whose purchases caused Rogers to pay him the $500.00 payments. Garthright testified that if he had any "indirect" contact with these customers, it could only have been that they had seen Smith Trucking trailers made by Circle R, and had asked the drivers where they got them. The court finds the evidence thus far presented concerning the $500.00 payments as demonstrating Garthright's co-inventorship, as well as the evidence thus far presented concerning Garthright's contribution to the invention of the side-dump trailers, is at best equivocal, and at worst insubstantial. The court therefore turns to factual matters concerning Smithco's formation and its manufacture of side-dump trailers.
Smith formed Smithco as an Iowa corporation in 1994, with its principal place of business in LeMars, Iowa. Smithco began doing business on May 18, 1994. Its business was to manufacture Smithco's own line of side-dump trailers, based on Garthright's modifications and other prior art. Smithco now employs twenty employees, almost all of whom are full-time, with a total weekly pay-roll for non-officer employees of almost $5,000, excluding taxes. Smithco currently produces approximately one side-dump trailer per week, with a sale price of approximately $29,000, and Smith testified that Smithco has more orders than it can currently fill at its present manufacturing capacity. Smithco makes no other product. Smith testified that he did not know if it would be possible for Smithco to retool to make some other kind of side-dump trailer, and stood on his assertion that Smithco is not currently making an infringing trailer.
Two examples of Smithco trailers, according to testimony and photographic evidence, have a left side dumping pivot of ninety-four degrees, and a right side dumping pivot of ninety-five degrees, for one, and a left side dumping pivot of ninety-two degrees, and a right side dumping pivot of ninety-four degrees, for the other. Smith testified that these dumping angles are consistent with his recollection of the dumping angles as measured during the tests shown in the photographs. Smithco also entered into evidence, in the form of photographs and testimony, evidence concerning a third Smithco trailer, now owned by Joe Garthright's trucking company, Triple D. This third Smithco trailer has a left full dumping pivot of ninety-seven to ninety-eight degrees, and a right full dumping pivot of ninety-six to ninety-seven degrees. This was the same trailer shown in Circle R's photographic exhibits, which photographs formed part of the basis for Circle R's expert's opinion concerning infringement. In his declaration, Smith asserted that the manufacturing procedures for Smithco are sufficiently consistent that none of their trailers would have a dumping pivot to either side of less than ninety-two degrees. At the hearing, Smith testified that the "jigs" on which the trailers are built are set for a dumping angle, exclusive of any twist or leaning of the frame during dumping, of ninety-four degrees. Smithco contends that these trailers cannot literally infringe a patent claim stating that it provides for a dumping pivot not greater than ninety degrees from its non-dumping position, and its expert witness, Mr. Herink, concurs.
Circle R's expert, registered patent attorney John A. Beehner, however, opined to the *1286 contrary. He testified that his opinion was that the Smithco trailers, which he had considered via photographic evidence and representations of plaintiff's counsel, and "rigidly" compared to the '214 patent, infringed each and every limitation of claims 1 and 2 of the patent. He stated that he recognized that claim 2 was dependent on claim 1, and therefore could not be infringed if claim 1 was not infringed. He also conceded that none of the photographs he had examined prior to the hearing showed the Smithco trailers in dumping position. Mr. Beehner testified that his opinion as to infringement of the last limitation of claim 1 was based on the representation of Circle R's counsel that the Smithco trailers pivoted not more than ninety degrees when fully dumping, and that he had no firsthand knowledge of the dump angle of any of the Smithco trailers.
All of the dumping pivots described above were measured while the trailers were standing on ground apparently level to the naked eye, according to witnesses present, and the tub of each truck, in the non-dumping position, appeared to be level. Indeed, the photographic evidence of the Smithco trailers provided by Smithco all included angle-finder readings in the non-dumping position indicating that the trucks were standing level. The measurements of pivot were relative to this non-dumping position, and therefore relative to level ground. The parties and witnesses all conceded that in the course of side dumping, the frame of the trailer either leans or twists in the direction of the dump approximately four or five degrees. Thus, some portion of the full-dumping pivot is the result of this twist or leaning of the frame in addition to pivot of the tub relative to the frame.
With this factual and procedural background in mind, the court now turns to the legal standards applicable to Circle R's motion for a preliminary injunction in a patent case.
II. LEGAL ANALYSIS
(Including some further preliminary findings of fact)
The United States Constitution vests Congress with the power to "promote the Progress of Science and the useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." U.S. CONST., art. I, ง 8, cl. 8. To that end, Congress passed the patent laws of the United States found in Title 35 of the United States Code. Among the provisions of U.S. patent laws is 35 U.S.C. ง 283, which provides for injunctions in patent cases as follows:
The several courts having jurisdiction of cases under this title may grant injunctions in accordance with the principles of equity to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.
35 U.S.C. ง 283; see also High Tech Med. Instrumentation, Inc. v. New Image Indus., Inc., 49 F.3d 1551, 1554 (Fed.Cir.1995) (finding that "Congress has authorized district courts in patent cases to grant injunctions" in accordance with the terms of 35 U.S.C. ง 283); Reebok Int'l, Ltd. v. J. Baker, Inc., 32 F.3d 1552, 1555 (Fed.Cir.1994) ("Injunctive relief in patent cases is authorized by 35 U.S.C. ง 283 (1988)."). This provision authorizes the district courts to grant both preliminary injunctions, after preliminary proceedings, and permanent injunctions, after a full determination on the merits. High Tech Med., 49 F.3d at 1554. However, the Federal Circuit Court of Appeals has cautioned that "a preliminary injunction is `not to be routinely granted.'" High Tech Med., 49 F.3d at 1554 (quoting Intel Corp. v. ULSI Sys. Technology, Inc., 995 F.2d 1566, 1568 (Fed.Cir.1993), cert. denied, ___ U.S. ___, 114 S. Ct. 923, 127 L. Ed. 2d 216 (1994)); Intel Corp., 995 F.2d at 1568 ("[A] preliminary injunction is a drastic and extraordinary remedy that is not to be routinely granted."); New England Braiding Co. v. A.W. Chesterton Co., 970 F.2d 878, 882 (Fed.Cir.1992) (describing issuance of a preliminary injunction as "extraordinary relief"); Nutrition 21 v. United States, 930 F.2d 867, 869 (Fed.Cir. 1991) (same); Illinois Tool Works, Inc. v. Grip-Pak, Inc., 906 F.2d 679, 683 (Fed.Cir. 1990) (same). A preliminary injunction based on patent infringement "involves substantive issues unique to patent law and, therefore, is governed by the law of [the *1287 Federal Circuit Court of Appeals]." Reebok, 32 F.3d at 1555.
A. Standards For Preliminary Injunctions In Patent Cases
1. Factors in the analysis
The Federal Circuit Court of Appeals has established a number of equitable inquiries to determine when issuance of a preliminary injunction pursuant to 35 U.S.C. ง 283 is "reasonable." These include (1) likelihood of success on the merits; (2) irreparable harm to the patentee if a preliminary injunction is denied; (3) a balance of the hardships to the parties as the result of granting or denying an injunction; and (4) the public interest weighing for or against issuance of a preliminary injunction in a particular case. See, e.g., PPG Indus., Inc. v. Guardian Indus. Corp., 75 F.3d 1558, 1558 (Fed.Cir.1996); Sofamor Danek Group, Inc. v. DePuy-Motech, Inc., 74 F.3d 1216, 1219 (Fed.Cir.1996) (formulating the four inquiries as whether the movant can show: "(1) a reasonable likelihood of success on the merits, (2) an irreparable harm, (3) the balance of hardships tipping in its favor; and (4) a tolerable effect on the public interest," citing Hybritech, Inc. v. Abbott Labs., 849 F.2d 1446, 1451 (Fed.Cir.1988)); Reebok, 32 F.3d at 1555 (also citing Hybritech); Intel Corp., 995 F.2d at 1568 (also citing Hybritech); New England Braiding Co., 970 F.2d at 882; Filmtec Corp. v. Allied-Signal, Inc., 939 F.2d 1568, 1571 (Fed.Cir.1991); Chrysler Motors Corp. v. Auto Body Panels of Ohio, Inc., 908 F.2d 951, 952 (Fed.Cir.1990).[5] These factors must be balanced against each other and against the extent of the relief sought in the patentee's motion for preliminary injunction. Sofamor, 74 F.3d at 1219; Intel Corp., 995 F.2d at 1568 ("Each factor must be weighed and assessed against the others and against the form and magnitude of the relief requested," citing Hybritech); Filmtec Corp., 939 F.2d at 1571; Chrysler Motors Corp., 908 F.2d at 953; Hybritech, 849 F.2d at 1451. The movant bears the burden of proving that it is entitled to preliminary injunctive relief. Sofamor, 74 F.3d at 1219; Reebok, 32 F.3d at 1555.
The decision to grant or deny a preliminary injunction in a patent case is a matter in the trial court's discretion, and review is for abuse of that discretion. PPG Indus., 75 F.3d at 1558; Sofamor, 74 F.3d at 1219; High Tech Med., 49 F.3d at 1551 (observing, "After a district court has granted a preliminary injunction, however, this court will reverse only if the district court `has abused its discretion, committed an error of law, or seriously misjudged the evidence,'" quoting Hybritech, 849 F.2d at 1449); Reebok, 32 F.3d at 1555; Filmtec Corp., 939 F.2d at 1571 (also reviewing for "abuse of discretion, an error of law, or a serious misjudgment of the evidence," citing Chrysler Motors Corp., 908 F.2d at 953). However, to overturn the denial of a preliminary injunction, an appellant must show both that the trial court relied on clearly erroneous factors and that it abused its discretion in otherwise denying the preliminary injunction. Sofamor, 74 F.3d at 1219; Reebok, 32 F.3d at *1288 1555 ("When a preliminary injunction is denied, to obtain reversal the movant must show not only that one or more of the findings relied on by the district court was clearly erroneous, but also that denial of the injunction amounts to an abuse of the court's discretion upon reversal of erroneous findings."); New England Braiding Co., Inc., 970 F.2d at 882 (to obtain reversal of the grant of a preliminary injunction, the alleged infringer must convince the appellate court "that one of the factual premises is clearly erroneous," but to obtain reversal of the denial of a preliminary injunction, the patentee "carries a heavier burden" to "show not only that one or more of the factors relied on by the district court was clearly erroneous, but also that a denial of the preliminary relief sought would amount to an abuse of the court's discretion upon reversal of an erroneous finding.").
2. Relationship of the factors
A preliminary injunction may be denied in the absence of an adequate showing with regard to any one of the four factors, depending on the weight given each factor in the court's discretionary examination as justifying denial. Reebok, 32 F.3d at 1556; Intel Corp., 995 F.2d at 1570 ("Although none of the factors alone is dispositive, the absence of a sufficient showing with regard to any one factor may, in light of the weight assigned to the other factors, preclude preliminary injunctive relief."); Chrysler Motors Corp., 908 F.2d at 953. Although the Federal Circuit Court of Appeals generally looks at all four factors in its preliminary injunction inquiry, "[c]entral to the movant's burden are the likelihood of success and irreparable harm factors." Sofamor, 74 F.3d at 1219; Reebok, 32 F.3d at 1555-56 ("[I]t is always preferable that a district court make findings regarding each of the four factors which weigh in the balance concerning whether to deny a preliminary injunction," but "[b]ecause, irrespective of relative or public harms, a movant must establish both a likelihood of success on the merits and irreparable harm ..., the district court may deny a preliminary injunction based on the movant's failure to establish either of these two crucial factors without making additional findings respecting the other factors."); Nutrition 21, 930 F.2d at 869 ("Sufficient factual findings on the material issues are necessary to allow this court to have a basis for meaningful review."). Indeed, where the plaintiff patentee showed neither a likelihood of success on the merits nor irreparable harm, the Federal Circuit Court of Appeals held that the district court properly denied a motion for preliminary injunction, and itself looked no further than these two factors in its review of the denial of a preliminary injunction. Sofamor, 74 F.3d at 1223; High Tech Med., 49 F.3d at 1554-55 (finding that the preliminary injunction granted by the district court could not be sustained on the grounds of likelihood of success on the merits or irreparable harm, the appellate court concluded that "it is unnecessary to address the arguments directed to the other factors bearing on the issuance of preliminary injunctive relief."); Reebok, 32 F.3d at 1556 ("[A] movant cannot be granted a preliminary injunction without findings by the district court that the movant carried its burden on both [likelihood of success and irreparable harm]," with emphasis in the original, and noting that "[a]rguably, our cases suggest that a district court must always consider all four factors," but finding all factors must only be considered before granting a preliminary injunction, while denial of a motion for a preliminary injunction could be proper without consideration of the third and fourth factors); New England Braiding, 970 F.2d at 882 (affirming denial of a preliminary injunction even though the district court made no findings concerning irreparable harm, the balance of hardships, or public interest, because the district court committed no clear error in finding that the movant was not likely to succeed on the merits at trial). This court will examine each of the four factors in turn, beginning, however, with these two "central" factors of likelihood of success on the merits and irreparable harm.[6]
*1289 3. Provisional determinations
However, before considering any of these factors, and the necessary findings of fact each entails, it is well to remember that in the context of preliminary injunction applications, in patent infringement as well as other kinds of cases, the court typically operates under "severe time constraints" and must customarily decide the motion "`on the basis of procedures that are less formal and evidence that is less complete than in a trial on the merits.'" New England Braiding Co., 970 F.2d at 883 (quoting University of Texas v. Camenisch, 451 U.S. 390, 395, 101 S. Ct. 1830, 1834, 68 L. Ed. 2d 175 (1981)). As the Federal Circuit Court of Appeals observed, "such a record does not usually allow for a reliable resolution of the merits." Id. Thus, the Supreme Court in Camenisch, the case cited by the Federal Circuit Court of Appeals in New England Braiding, stated the general rule that "the findings of fact and conclusions of law made by a court granting a preliminary injunction are not binding at trial on the merits." University of Texas v. Camenisch, 451 U.S. 390, 395, 101 S. Ct. 1830, 1834, 68 L. Ed. 2d 175 (1981); accord Henderson v. Bodine Aluminum, Inc., 70 F.3d 958, 962 (8th Cir.1995) (non-patent case citing this statement from Camenisch as the "general rule" for findings of fact and conclusions of law in preliminary injunction rulings); United States v. Barnes, 912 F. Supp. 1187, 1190 (N.D.Iowa 1996) (applying the "general rule" of Camenisch to a preliminary injunction ruling on the government's request for a preliminary injunction pursuant to 18 U.S.C. ง 1345 to enjoin activities of defendants who were allegedly engaged in mail fraud in violation of 18 U.S.C. ง 1341). Any findings of fact in this ruling, either made above or in the course of the legal analysis, as well as any conclusions of law forming part of the court's determination of whether the issuance of a preliminary injunction is proper in this case, are intended to be subject to this "general rule" and are not to be considered "final."
B. Individual Factors And Their Application
1. Likelihood of success on the merits
Likelihood of success on the merits depends upon sufficient showing of both validity of the patent-in-suit and its infringement by the defendant sought to be enjoined. Sofamor, 74 F.3d at 1219 (finding these dual requirements in 35 U.S.C. ง 283 and citing Hybritech, 849 F.2d at 1451); Reebok, 32 F.3d at 1555 (also citing Hybritech). Therefore, this court will consider Circle R's likelihood of success over Smithco's assertions of invalidity of the '214 patent, as well as its likelihood of success on its claim of infringement of the patent.
a. Validity
The presumption of validity upon which Circle R specifically relies in this case is found in 35 U.S.C. ง 282. See New England Braiding Co., 970 F.2d at 882 ("Section 282, United States Code, Title 35 (1988), provides that a patent shall be presumed valid.") Section 282 provides, in pertinent part, as follows:
A patent shall be presumed valid.... The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting it.
35 U.S.C. ง 282. However, this presumption of validity can be "weighed" in determining the likelihood of success on the merits in the context of a motion for a preliminary injunction. New England Braiding Co., 970 F.2d at 882. The presumption acts as a procedural device, "plac[ing] the burden of going forward with evidence and the ultimate burden of persuasion of invalidity at trial on the alleged infringer." Id. However, unless the alleged infringer challenges validity of the patent-in-suit, the patentee "need do nothing to establish its rights under the patent." Id. In this case, however, Smithco has directly challenged the presumption of validity of the '214 patent and asserts that it has presented sufficient evidence to overcome the presumption.
*1290 As to the question of validity in the context of disposition of a motion for a preliminary injunction, the Federal Circuit Court of Appeals has stated,
The ultimate question ... is whether the challenger's evidence of invalidity is sufficiently persuasive that it is likely to overcome the presumption of patent validity. See New England Braiding Co. v. A.W. Chesterton Co., 970 F.2d 878, 883, 23 U.S.P.Q.2d 1622, 1625 (Fed.Cir.1992).
PPG Indus., 75 F.3d at 1566. Thus, the alleged infringer must present sufficient evidence in support of its invalidity claim to raise a "substantial question" of invalidity, "although the defense may not be entirely fleshed out." New England Braiding Co., 970 F.2d at 883. Where the defendant cannot make sufficient showing of invalidity, the presumption of validity is sufficient to satisfy the patentee's burden of showing of likelihood of success on the merits as to validity. PPG Indus., 75 F.3d at 1566. However, although the patentee has no burden to prove validity of its patent, when validity has been challenged, "the patentee must show that the alleged infringer's defense lacks substantial merit." New England Braiding Co., 970 F.2d at 883.
i. The "on-sale" bar. Smithco's first challenge to the validity of the '214 patent is that the alleged invention described in the patent was on sale more than one year before Rogers applied for the patent. Thus, Smithco asserts that the patent is invalid pursuant to 35 U.S.C. ง 102(b):
An inventor loses the right to a patent if he placed the claimed invention "in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States." 35 U.S.C. ง 102(b). Whether an invention is on sale is a question of law.
In re Mahurkar Double Lumen Hemodialysis Catheter Patent Litigation, 71 F.3d 1573, 1576 (Fed.Cir.1995); Ferag AG v. Quipp, Inc., 45 F.3d 1562, 1566 (Fed.Cir.) (citing the statutory bar and stating that the ultimate determination that a product was placed on sale is a question of law based on underlying facts), cert. denied, ___ U.S. ___, 116 S. Ct. 71, 133 L. Ed. 2d 31 (1995); In re Epstein, 32 F.3d 1559, 1564 (Fed.Cir.1994) (citing statutory bar and also stating determination is one of law based on underlying facts). The alleged infringer bears the burden of demonstrating that "`there was a definite sale or offer to sell more than one year before the application for the subject patent, and that the subject matter of the sale or offer to sale fully anticipated the claimed invention.'" Id. (quoting UMC Elecs. Co. v. United States, 816 F.2d 647, 656 (Fed.Cir.1987), cert. denied, 484 U.S. 1025, 108 S. Ct. 748, 98 L. Ed. 2d 761 (1988)); Ferag AG, 45 F.3d at 1566. The test is an objective one, measuring whether the inventor placed the invention on sale, which is "objectively manifested by a sale or offer for sale of a product that embodies the invention claimed in the patent." Ferag AG, 45 F.3d at 1568.
Whether a device has been placed on sale is not subject to a "mechanical rule," but instead depends on the totality of the circumstances, considered in view of the policies behind ง 102(b). In re Mahurkar, 71 F.3d at 1577; Ferag AG, 45 F.3d at 1565 (determination of whether an invention was "on sale" depends on the totality of the circumstances; no single one controls); King Instrument Corp. v. Otari Corp., 767 F.2d 853, 860 (Fed. Cir.1985) (underlying policy drives the inquiry), cert. denied, 475 U.S. 1016, 106 S. Ct. 1197, 89 L. Ed. 2d 312 (1986). The Federal Circuit Court of Appeals has identified those policy considerations as including the following:
(1) discouraging removal of inventions from the public domain that the public reasonably has come to believe are freely available; (2) encouraging the prompt and widespread disclosure of inventions; (3) allowing an inventor a reasonable amount of time following sales activity to determine the potential economic value of a patent; and (4) prohibiting an inventor from commercially exploiting his invention beyond the statutorily prescribed time.
In re Mahurkar, 71 F.3d at 1577; Ferag AG, 45 F.3d at 1566; Envirotech Corp. v. Westech Eng'g, Inc., 904 F.2d 1571, 1574 (Fed.Cir. 1990). The Federal Circuit Court of Appeals has therefore stressed that the central focus of the on-sale inquiry is whether there was a *1291 "commercialization" of the invention. In re Mahurkar, 71 F.3d at 1577; Ferag AG, 45 F.3d at 1566 ("[T]he inventor is strictly held to the requirement that he file his patent application within one year of any attempt to commercialize the invention.").
However, "a patentee may escape the section 102(b) bar on the ground the use or sale was experimental." LaBounty Mfg., Inc. v. U.S. Int'l Trade Comm'n, 958 F.2d 1066, 1071 (Fed.Cir.1992); see also Ferag AG, 45 F.3d at 1568-69 (sale of device meeting buyer's specifications meets "on-sale" test, while "experimental" sales do not); Atlantic Thermoplastics Co., Inc. v. Faytex Corp., 5 F.3d 1477, 1480 n. 3 (Fed.Cir.1993) ("If the invention was sold or offered for sale before the critical date, other than primarily for a bona fide experimental purpose to perfect the invention, 35 U.S.C. ง 102(b) bars [the patentee] from obtaining a patent therefor."); U.S. Environmental Prods., Inc. v. Westall, 911 F.2d 713, 716 (Fed.Cir.1990) ("A section 102(b) bar is avoided if the primary purpose of the sale was experimental."). The Federal Circuit Court of Appeals has several times considered the difference between "experimental" sales to "perfect" an invention and truly commercial sales. Thus, in LaBounty, the court reiterated,
"[A] use or sale is experimental for purposes of section 102(b) if it represents a bona fide effort to perfect the invention or to ascertain whether it will answer its intended purpose.... If any commercial exploitation does occur, it must be merely incidental to the primary purpose of experimentation to perfect the invention." Pennwalt Corp. v. Akzona, Inc., 740 F.2d 1573, 1580-81, 222 U.S.P.Q. (BNA) 833, 838 (Fed. Cir.1984) (citations omitted).
LaBounty, 958 F.2d at 1071. To test whether there has been "commercialization" of the invention, as opposed to merely "experimental" sales, the court examines such matters as whether the invention was advertised or offered to anyone other than a party involved in the development of the invention, whether the sale is of "prototypes" that do not place the invention in the public domain or lead the public to believe that the device is freely available, and whether the sales allowed the patentee to test the potential market value of the patent. In re Mahurkar, 71 F.3d at 1577; Westall, 911 F.2d at 717 (one factor is "existence of promotional activities"). Furthermore, the Federal Circuit Court of Appeals has considered whether there is an agreement by the customer to use the device secretly and keep records of progress, and continued control by the inventor of the patented equipment while in the hands of the purchaser. LaBounty, 958 F.2d at 1071 (secrecy agreement and record-keeping, as well as continued control); Westall, 911 F.2d at 716 (factors include "lack of record-keeping," "lack of control by the inventor," "lack of secrecy obligations on the part of the user."); Armco, Inc. v. Cyclops Corp., 791 F.2d 147, 149 (Fed.Cir.1986) (district court improperly granted summary judgment of an "on-sale" bar, because district court disregarded evidence that the inventor and the buyer had a confidentiality agreement concerning use of the invention and evidence of other documents exchanged between the parties referring to the experimental nature of the invention and describing the purpose of the shipments to the buyer as testing whether the alloy in question would work for its intended purpose).[7] Looking more closely at the inventor's continued *1292 control over the invention, the sale or offer of sale purportedly violating the on-sale bar must involve separate entities; thus, the question is, "whether the seller so controls the purchaser that the invention remains out of the public's hands." Ferag AG, 45 F.3d at 1567. When entities are "related," it is "difficult to determine whether the inventor is attempting to commercialize his invention." Id.
Finally, because Rogers has asserted it was his intent that the sales to Smith Trucking were to be "experimental," the court must consider what part the patentee's intent plays in a determination of experimental use. In LaBounty, the Federal Circuit Court of Appeals discussed the impact of the inventor's intent in light of contrary objective evidence:
An inventor's protestation of an intent to experiment, expressed for the first time during litigation, is of little evidentiary value, at best. In re Brigance, 792 F.2d 1103, 1108, 229 U.S.P.Q. (BNA) 988, 991 (Fed.Cir.1986); TP Labs. [v. Professional Positioners, Inc.], 724 F.2d [965,] 972, 220 USPQ [577,] 583 [(Fed.Cir.), cert. denied, 469 U.S. 826, 105 S. Ct. 108, 83 L. Ed. 2d 51 (1984)]. Indeed, "an inventor's subjective intent is immaterial when objective evidence points otherwise." Harrington Mfg. Co. v. Powell Mfg. Co., 815 F.2d 1478, 1481 n. 3, 2 USPQ2d 1364, 1366 n. 3 (Fed.Cir.1986). When sales are made in an ordinary commercial environment and the goods are placed outside the inventor's control, an inventor's secretly held subjective intent to "experiment," even if true, is unavailing without objective evidence to support the contention. Brigance, 792 F.2d at 1108, 229 USPQ at 991. Under such circumstances, the customer at a minimum must be made aware of the experimentation. As stated in In re Dybel, 524 F.2d 1393, 1401, 187 U.S.P.Q. (BNA) 593, 599 (CCPA 1975), "[Inventor's] failure to communicate to any of the purchasers or prospective purchasers of his device that the sale or offering was for experimental use is fatal to his case."
LaBounty, 958 F.2d at 1071-72; Westall, 911 F.2d at 717 ("The subjective belief of the inventors or customers [as to experimental use], however, must be weighed against objective evidence which indicates otherwise," also citing Brigance, 792 F.2d at 1108 & n. 8).
The court concludes that Smithco has established at least a "substantial question" as to the validity of the '214 patent under the "on-sale" bar of ง 102(b), although its assertion of sales prior to the critical date may need to be further "fleshed out" in order to prevail on a trial of the merits. New England Braiding Co., 970 F.2d at 883. Thus, the court finds Smithco's evidence of sales of the invention more than one year prior to the patent application in this case to be sufficiently persuasive to overcome the presumption of validity for preliminary injunction purposes. PPG Indus., 75 F.3d at 1566. Smithco has identified three sales, all occurring during 1992 and 1993, and all occurring more than a year before the critical date of October 20, 1994, when Rogers filed his patent application. To all appearances from the preliminary injunction record, the first two of those sales involved side-dump trailers employing or embodying every limitation of the subsequent patent, at least as to the two claims of the patent upon which the motion for preliminary injunction was founded. In re Mahurkar, 71 F.3d at 1576; Ferag AG, 45 F.3d at 1568. The trailers purchased by Smith Trucking in 1992 and 1993 employ the same side-dumping mechanism identified in the first claim of the patent, including the frame and hydraulic system, means for pivoting the trailers, and those first two trailers had a maximum degree of pivot while dumping that did not exceed ninety degrees, as required by the last limitation of claim 1 of the '214 patent.
Circle R argued that even if there is a "substantial question" that claim 1 is invalid owing to an "on-sale" bar, the three trailers, including the two the court finds meet the limitations of claim 1, had different pivot locking devices from that described in claim 2 of the patent, at least before repairs to the first trailer. Circle R argued that the validity of even dependent claims, such as claim 2, must be separately assessed even if the independent claim, upon which infringement of a dependent claim depends, is shown to be *1293 invalid. The court finds that, in general, the validity of each claim of a patent, even a dependent claim, is indeed a separate consideration from the validity of any other claim, even the validity of the independent claim upon which the dependent claim depends. See 35 U.S.C. ง 282 ("Each claim of a patent (whether independent, dependent, or multiple dependent form) shall be presumed valid independently of the validity of other claims; dependent or multiple dependent claims shall be presumed valid even though dependent upon an invalid claim."); 35 U.S.C. ง 253 ("Whenever, without any deceptive intention, a claim of a patent is invalid the remaining claims shall not thereby be rendered invalid."); Ortho Pharmaceutical Corp. v. Smith, 959 F.2d 936, 942 (Fed.Cir.1992) (citing งง 282 and 253, and stating, "We have held that this means `a party challenging the validity of a claim, absent a pretrial agreement or stipulation, must submit evidence supporting a conclusion of invalidity of each claim the challenger seeks to destroy,'" quoting Shelcore, Inc. v. Durham Indus., 745 F.2d 621, 625 (Fed.Cir.1984), and holding invalidity of one claim did not necessarily require the invalidation of others); but see Miles Labs., Inc. v. Shandon, Inc., 997 F.2d 870, 879 (Fed.Cir.1993) (where parties had stipulated that claim 1 of a patent was representative for the other claims in the patent, and the trial court properly understood that the result reached as to that claim would bind all other claims, the district court's invalidation of dependent claims upon finding claim 1 invalid was proper), cert. denied, ___ U.S. ___, 114 S. Ct. 943, 127 L. Ed. 2d 232 (1994). However, Smithco's expert stated his opinion that the language of claim 2 is broad enough to include the pivot locking devices originally employed on the first two trailers as well as those presently used on Circle R trailers, and presently in use on the first trailer. The court finds that Smithco's expert's interpretation is sufficient at this point in the proceedings to raise a "substantial question" as to whether claim 2 is also invalid under the "on-sale" bar.
The court must therefore turn to Circle R's contention that these sales still escape the "on-sale" bar, because they were only "experimental." On the preliminary injunction record, these sales involved "commercialization" of the invention, not merely experimental sales, because they were not for the purpose of perfecting or completing the invention, Atlantic Thermoplastics, 5 F.3d at 1480 n. 3, but instead were final sales of fully operational side-dump trailers to a commercial operation and the trailers sold were intended for commercial use without further alteration, testing, or reporting on performance. Although Circle R has presented some evidence, in the form of testimony by Mr. Rogers, that he viewed the sales as experimental, the more substantial objective evidence, LaBounty, 958 F.2d at 1071-72; Westall, 911 F.2d at 717, is that there were no restrictions on the sale or public use of the trailers, and no requirement of or request for feedback for the purposes of perfecting or completing the invention, and no communication to Smith Trucking that the trailers were in any respect "experimental" or that the sales were for "experimental" purposes. In re Mahurkar, 71 F.3d at 1577; LaBounty, 958 F.2d at 1071; Westall, 911 F.2d at 716.
The fact that the trailers sold more than one year prior to the patent application were built to Smith Trucking's specifications does not make them merely "experimental" either. Ferag AG, 45 F.3d at 1568-69 (sale of device meeting buyer's specifications meets "on-sale" test, while "experimental" sales do not). Thus, each of these sales was a "definite" sale, fully anticipating the subsequent patented invention, In re Mahurkar, 71 F.3d at 1576; Ferag AG, 45 F.3d at 1566, and each was a "commercialization" of the invention, involving a sale into the public domain, or indicating availability of the product to the general public, because each involved no restrictions on the use or resale of the trailers. Id.; Ferag AG, 45 F.3d at 1568-69. Nor can there be any doubt that Circle R did not "so control the purchaser," that is, Smith Trucking, "that the invention remain[ed] out of the public's hands." Ferag AG, 45 F.3d at 1567.
Thus, although it was not Circle R's burden to prove validity, Circle R has failed to "show that the alleged infringer's [on-sale] *1294 defense lacks substantial merit." New England Braiding Co., 970 F.2d at 883. Therefore, the court holds that Smithco has raised a "substantial question," id., based on "evidence of invalidity [that] is sufficiently persuasive that it is likely to overcome the presumption of patent validity." PPG Indus., 75 F.3d at 1566. That evidence indicates that the disputed claims, claims 1 and 2, of the '214 patent are invalid under the "on-sale" bar of 35 U.S.C. ง 102(b). Therefore, the likelihood of success as to invalidity tips against granting a preliminary injunction in this case.
ii. "Obviousness." Turning to Smithco's assertion that the '214 patent is also invalid because it is "obvious" under 35 U.S.C. ง 103, in preliminary injunction proceedings, the defendant must "demonstrate that the claimed invention would have been obvious to one skilled in the art in light of the disclosures" in prior art references. PPG Indus., 75 F.3d at 1566. "Obviousness" is a legal conclusion involving four factual inquiries: (1) the scope and content of the prior art; (2) the differences between the claims and the prior art; (3) the level of ordinary skill in the pertinent art; and (4) secondary considerations, if any, of nonobviousness. B.F. Goodrich Co. v. Aircraft Braking Sys. Corp., 72 F.3d 1577, 1582 (Fed.Cir.1996).
The court finds Smithco's assertion of invalidity based on "obviousness" less persuasive than its assertion of an "on-sale" bar. Smithco has failed to develop adequately, either in its briefs or in the course of the preliminary injunction hearing, any of the four factual inquiries such that the court can assess whether its "obviousness" challenge is "substantial" or "persuasive." PPG Indus., 75 F.3d at 1566; New England Braiding Co., 970 F.2d at 883. Indeed, the court suspects that the necessary factual inquiries would be difficult to make on the thinly developed record available to a court at the time of a preliminary injunction determination. Therefore the court rejects as a ground for denial of a preliminary injunction Smithco's assertion of invalidity owing to obviousness under 35 U.S.C. ง 103. Thus, the court concludes that nothing yet presented concerning the alleged obviousness of the '214 patent undercuts Circle R's likelihood of success on the merits. The court will pass on to other evidence which may or may not raise a substantial question as to the validity of the '214 patent and, consequently, Circle R's likelihood of success on the merits.
iii. Inventorship. Smithco has made a third challenge to validity (and enforceability) here, alleging that Rogers is not the sole inventor of the '214 patent. Although Smithco has framed this argument primarily in terms of 35 U.S.C. ง 116, which requires that when an invention is made by two or more persons, the patent must be sought by joint application of those persons, the court notes that Smithco may also be able to assert this invalidity defense pursuant to 35 U.S.C. ง 102(f), which provides that a person shall be entitled to a patent unless "he did not himself invent the subject matter sought to be patented." 35 U.S.C. ง 102(f). In New England Braiding Co., the Federal Circuit Court of Appeals considered an argument that a patent was invalid as a "derivative invention," which required the party asserting invalidity to demonstrate that "the named inventor in the patent acquired knowledge of the claimed invention from another, or at least so much of the claimed invention as would have made it obvious to one of ordinary skill in the art." New England Braiding Co., 970 F.2d at 883.
In this case, Smithco has presented only insufficient evidence of Joe Garthright's suggestion to Rogers of particular aspects of the claimed invention found in the '214 patent, thus failing to create a "substantial question," PPG Indus., 75 F.3d at 1566; New England Braiding Co., 970 F.2d at 883, as to whether Rogers acquired knowledge of those parts of the invention that would have made the '214 patent obvious to a person of ordinary skill in the art. New England Braiding Co., 970 F.2d at 883. As the court observed above, in its recitation of the factual background of this case, the evidence concerning $500.00 payments to Garthright and the evidence concerning his suggestion of patentable ideas is at best equivocal and at worst insubstantial. Therefore, the evidence in support of "inventorship" challenges is insufficient to overcome a presumption of validity, *1295 and does not weigh against Circle R's likelihood of success on the merits.
iv. Inequitable conduct. Smithco makes further challenges to the '214 patent that come under the rubric of "inequitable conduct." Inequitable conduct consists of an "`affirmative misrepresentation of a material fact, failure to disclose material information, or submission of false material information coupled with an intent to deceive.'" B.F. Goodrich Co., 72 F.3d at 1584 (quoting Molins PLC v. Textron, Inc., 48 F.3d 1172, 1178 (Fed.Cir.1995)); Molins, 48 F.3d at 1178. Smithco asserts that the '214 patent is unenforceable, because Rogers failed to disclose that Garthright was a co-inventor of the asserted invention, thus "affirmative[ly] misrepresent[ing] a material fact," and furthermore that Rogers failed to disclose the three trailers sold to Smith Trucking in 1992 and 1993 as "prior art" to the '214 patent, thus "fail[ing] to disclose material information" pertinent to the "on-sale" bar of ง 102(b), as well as to the questions of anticipation and obviousness of the patent under งง 102 and 103. Smithco contends that the latter failure to disclose specifically violated 37 C.F.R. 1.56, which imposes a "duty of candor and good faith" on applicants for a patent as well as a "duty to disclose to the [PTO] all information known to the individual to be material to patentability." 37 C.F.R. 1.56.
Again, the court does not agrees that the evidence of Garthright's contribution to the '214 patent as yet raises a substantial question of inequitable conduct. Although the evidence of the 1992 and 1993 sales of side-dump trailers to Smith Trucking as sales of the patented invention raises a substantial question of validity, because of the "on-sale" bar of ง 102(b), the court declines here to consider inequitable conduct based on a provisional record. See, e.g., Modine Mfg. Co. v. United States Int'l Trade Comm'n, 75 F.3d 1545, 1557 (Fed.Cir.1996) ("Both materiality and intent are essential factual predicates to inequitable conduct, and each must be proved by clear and convincing evidence," citing Kingsdown Med. Consultants, Ltd. v. Hollister, Inc., 863 F.2d 867 (Fed.Cir.1988) (en banc), cert. denied, 490 U.S. 1067, 109 S. Ct. 2068, 104 L. Ed. 2d 633 (1989)).[8] Furthermore, any inequitable conduct goes to unenforceability, rather than invalidity, see, e.g., Pro-Mold and Tool Co., Inc. v. Great Lakes Plastics, Inc., 75 F.3d 1568, 1575 (Fed.Cir. 1996) ("The established remedy for inequitable conduct is unenforceability of the patent."), and it is likelihood of success in light of both validity and infringement, not enforceability, that concerns the court when considering a preliminary injunction in a patent case. Sofamor, 74 F.3d at 1219 (finding these dual requirements in 35 U.S.C. ง 283 and citing Hybritech, 849 F.2d at 1451); Reebok, 32 F.3d at 1555 (also citing Hybritech).
The court, having found that there is a substantial question as to Circle R's likelihood of success on the merits as to validity, owing to a possible "on-sale" bar to the patent, will also consider the other prong of the likelihood of success inquiry, which examines Circle R's infringement claim.
b. Infringement
When the court considers likelihood of success on the merits in terms of an infringement claim, the court may construe any disputed claim language as a matter of law. Sofamor, 74 F.3d at 1220 (citing Markman v. Westview Instruments, Inc., 52 F.3d 967, 978 (Fed.Cir.), cert. granted, ___ U.S. ___, 116 S. Ct. 40, 132 L. Ed. 2d 921 (1995)). However, the trial court does not have to interpret the claims of the patent-in-suit "conclusively and finally" during a preliminary injunction proceeding, even though under Markman, the court must construe the claims as a matter of law; instead the trial court "may exercise its discretion to interpret the claims at a time when the parties have presented a full picture of the claimed *1296 invention and prior art," for example, in the course of proceedings subsequent to those pertaining to the preliminary injunction. Sofamor, 74 F.3d at 1221 (citing cases so holding).
Once the trial court has construed the claims of the patent, to the extent and with the finality it considers necessary for preliminary injunction purposes, the court must then determine whether the accused device is likely to fall within the scope of the claims so construed. Sofamor, 74 F.3d at 1220; H.H. Robertson Co., 820 F.2d at 389. To infringe a patent, an accused device must embody each claim limitation or its equivalent. Sofamor, 74 F.3d at 1220; Charles Greiner & Co. v. Mari-Med Mfg., Inc., 962 F.2d 1031, 1034 (Fed.Cir.1992). Thus, the movant fails to show a reasonable likelihood of success on an infringement claim where it fails to prove that the accused device exactly embodies each claim limitation or its equivalent. Sofamor, 74 F.3d at 1221 (movant failed to show exact embodiment, and therefore failed to show likelihood of success on infringement claim); Charles Greiner, 962 F.2d at 1034. Nor does a device infringe a patent simply because it is possible to alter it in a way that would satisfy all the limitations of a patent claim. High Tech Med., 49 F.3d at 1555 (citing Hap Corp. v. Heyman Mfg. Co., 311 F.2d 839, 843 (1st Cir.1962), cert. denied, 373 U.S. 903, 83 S. Ct. 1290, 10 L. Ed. 2d 198 (1963)).
In the present case, the court concludes, provisionally, for the purposes of disposing of the motion for preliminary injunction, Sofamor, 74 F.3d at 1221, that the final limitation of claim 1 of the '214 patent requires that the accused device employ a dumping pivot that is not greater than ninety degrees from the non-dumping position. Furthermore, the court concludes, if only provisionally, that the dumping pivot in question is relative to the "non-dumping," that is, starting position, of the tub, not relative to the frame. Although counsel for plaintiff attempted to argue that the critical measurement must be relative to the frame in both the non-dumping and fully-dumping position, and thus, an alleged infringer could not benefit from any twist or lean of the frame during the dumping process, that argument was rejected by Smithco's expert, and is rejected by the court. Smithco's expert pointed out that the patent refers only to pivot relative to the non-dumping position, which he interpreted to mean relative to level ground, not relative to the frame. Thus, according to Smithco's expert, when fully dumping, the final angle of the frame is irrelevant; only the final angle of the tub bottom relative to its starting position matters. The court's provisional construction is slightly different still: the court's view is that the dumping pivot has nothing whatever to do with a reference to the "frame" or to "level" or "level ground." The last limitation of claim 1 makes no reference either to the "frame" or to "level" or "level ground." Instead, the only reference is "when positioned in its dumping positions, without the necessity of pivotally moving said body greater than 90ฐ from its non-dumping position." Plaintiff's Exhibit 1, the '214 patent, claim 1, final limitation. The limitation refers to the non-dumping, i.e., starting position of the tub, pivotal motion of the tub, and a final, dumping position of the tub, and the angle in question is between the starting and final positions. Thus, any degree of pivot resulting from the twist or lean of the frame is to be included in the degree of pivot of the tub, because it contributes to the final position of the tub.
To illustrate, using a scenario suggested by Circle R's counsel from time to time, if the side-dumper were situated on ground that inclined fifteen degrees to the left, when commencing to dump to the left, that is, uphill, the "non-dumping position" of the tub would be negative fifteen degrees according to an angle finder calibrated with zero as level. If moved pivotally not greater than ninety degrees to the left, the final, or dumping, position of the tub would be not greater than positive seventy-five degrees, i.e., seventy-five degrees relative to "level ground," but the tub would have pivoted a full ninety degrees, the maximum pivot stated in the claim limitation. If the final position of the tub in this situation was instead positive eighty degrees, that is, eighty degrees relative to "level ground," the tub would have pivoted to the left ninety-five degrees, although *1297 it would not be straight up and down, and the trailer would avoid the express language of the limitation.[9]
To summarize, the court construes the final limitation of claim 1 to describe a pivot to a final, fully-dumping position that is not greater than ninety degrees from the starting, non-dumping position of the tub. The angle in question is between these starting an final positions of the tub, and not relative either to "level," "level ground," or the frame of the trailer. Thus, any degree of pivot resulting from the twist or lean of the frame is to be included in the degree of pivot of the tub, because it contributes to the final position of the tub. With this critical claim limitation of the '214 patent so construed, the court must next consider the question of whether Circle R has made an adequate showing of likelihood of success on its claim of infringement of the '214 patent to justify issuance of a preliminary injunction in this case.
i. Literal infringement. Literal infringement requires the patentee to show the accused device exactly embodies each claim limitation. Sofamor, 74 F.3d at 1221 (movant failed to show exact embodiment, and therefore failed to show likelihood of success on infringement claim, in support of motion for preliminary injunction); Lantech, Inc. v. Keip Machine Co., 32 F.3d 542, 547 (Fed.Cir.1994) (for literal infringement, each limitation of the claim must be met by the accused device exactly, and any deviation from the claim precludes a finding of literal infringement); North Am. Vaccine v. American Cyanamid Co., 7 F.3d 1571, 1574 (Fed. Cir.1993) (same), cert. denied, ___ U.S. ___, 114 S. Ct. 1645, 128 L. Ed. 2d 365 (1994); Charles Greiner, 962 F.2d at 1034 (same). The accused devices, the Smithco trailers, however, do not exactly embody the last claim limitation of claim 1 as the court has construed the limitation. Sofamor, 74 F.3d at 1220; Charles Greiner, 962 F.2d at 1034. Rather, the evidence of record in these preliminary proceedings is that the accused Smithco trailers involve dumping pivots of between ninety-two and ninety-eight degrees. The court affords no weight to the opinion of Circle R's expert to the effect that the Smithco trailers infringe the final limitation of claim 1, because it is apparent from the testimony of Mr. Beehner that he did not examine any Smithco trailer in operation, had no photographs of a Smithco trailer actually in the fully dumping position, and simply relied on counsel's representations that the Smithco trailers pivoted not more than ninety degrees, a representation not borne out by any evidence of record.
Although it is possible that the Smithco trailers could be altered to employ a slightly smaller degree of dumping pivot, thus satisfying this limitation of claim 1, that is not the question in the infringement analysis. High Tech Med., 49 F.3d at 1555. Because the accused devices do not embody this limitation of claim 1, on the provisional record here, they cannot embody each limitation of claim 2, which is derivative of claim 1. Thus, Circle R has failed to show a reasonable likelihood of success on its literal infringement claim, because it has failed to prove that the accused device exactly embodies each claim limitation. Sofamor, 74 F.3d at 1221.
Circle R alleged only "literal" infringement of its patent in its complaint and in its motion for a preliminary injunction. Smithco, in defending the motion for preliminary injunction, injected the issue of "doctrine of equivalents" infringement. Thus, giving Circle R the benefit of the doubt, the court must also consider whether Circle R could show a reasonable likelihood of success on the merits of a "doctrine-of-equivalents" infringement claim.
ii. "Doctrine of equivalents." The court observes that Circle R also has but slight likelihood of success on a "doctrine of equivalents" infringement claim. An accused product that does not literally infringe a claim may nonetheless infringe the patent under the "doctrine of equivalents" if "`it performs substantially the same function in *1298 substantially the same way to obtain the same results.'" Southwall Technologies, Inc. v. Cardinal IG Co., 54 F.3d 1570, 1579 (Fed.Cir.) (quoting Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 608, 70 S. Ct. 854, 856, 94 L. Ed. 1097 (1950)), cert. denied, ___ U.S. ___, 116 S. Ct. 515, 133 L. Ed. 2d 424 (1995); Wolverine World Wide, Inc. v. Nike, Inc., 38 F.3d 1192, 1196 (Fed. Cir.1994) (product may infringe if it contains every limitation, either literally, or by substantial equivalence); Genentech, Inc. v. Wellcome Found., Ltd., 29 F.3d 1555, 1567 (Fed.Cir.1994) (substantial equivalence under Graver Tank requires a "showing of substantial identity of function, way, and result," and whether the "way" or "result" prong is met "is highly dependent on how broadly one defines the `function'" element); Atlanta Motoring Accessories, Inc. v. Saratoga Technologies, Inc., 33 F.3d 1362, 1366 (Fed.Cir. 1994); Dolly, Inc. v. Spalding & Evenflo Cos., Inc., 16 F.3d 394, 397 (Fed.Cir.1994). As the parties pointed out in the preliminary injunction hearing, however, the Federal Circuit Court of Appeals has recently reaffirmed that the function-way-result test is not "the test" of equivalence in "doctrine of equivalence" cases, instead citing Graver Tank as also stating the question of equivalence as whether there are only "insubstantial differences between the claimed and accused products or processes." Hilton Davis Chem. Co. v. Warner-Jenkinson Co., 62 F.3d 1512, 1521-22 (Fed.Cir.1995) (in banc), cert. granted, ___ U.S. ___, 116 S. Ct. 1014, 134 L. Ed. 2d 95 (Feb. 26, 1996); see also Roton Barrier, Inc. v. The Stanley Works, 79 F.3d 1112, 1126 (Fed.Cir.1996) ("In Hilton Davis, this court, in reviewing the doctrine of equivalents, stated that the traditional function, way, result tripartite test is not `the' test for infringement under the doctrine of equivalents.... Rather, a finding of infringement under the doctrine `requires proof of insubstantial differences between the claimed and accused products or processes....' Thus, satisfaction of the tripartite test may not end the infringement inquiry," but may instead require the court to consider copying or designing around the patent);[10]National Presto Indus., Inc. v. West Bend Co., 76 F.3d 1185, 1191 (Fed.Cir.1996) ("In Hilton Davis the court reaffirmed that proof of equivalency is not a matter of formula, but of evidence appropriate to the case."); Modine Mfg. Co. v. U.S. Int'l Trade Comm'n, 75 F.3d 1545, 1556 (Fed.Cir.1996) ("The controlling criterion, as reaffirmed in Hilton Davis, 62 F.3d at 1518, 35 USPQ2d at 1645, is whether the accused device is substantially the same as the claimed invention. See Graver Tank & Mfg. Co. v. Linde Air Prods. Co., 339 U.S. 605, 607, 70 S. Ct. 854, 855-56, 94 L. Ed. 1097 (1950) (insubstantial changes do not avoid the application of the doctrine of equivalents)."); Sofamor, 74 F.3d at 1221-22 (citing Hilton Davis for the "insubstantial changes" test, and finding that test was drawn from Graver Tank's rejection of a "formula" for determining equivalence, and noting Hilton Davis's rejection of the function-way-result tests as "the test"); Pall Corp. v. Micron Separations, Inc., 66 F.3d 1211, 1218 (Fed.Cir.1995) (Hilton Davis reaffirmed Graver Tank's recognition of a requirement of "substantial difference"). It could be asserted that a matter of a few degrees of pivot is only an "insubstantial difference," and therefore is "substantially *1299 equivalent" to the last limitation of claim 1 of the '214 patent.
However, Circle R cannot make such an argument. "Prosecution estoppel" prevents a patentee from recapturing within the scope of the claims of the patent under the doctrine of equivalents any scope of the claims surrendered during prosecution. Sofamor, 74 F.3d at 1222 (citing Exhibit Supply Co. v. Ace Patents Corp., 315 U.S. 126, 136, 62 S. Ct. 513, 518, 86 L. Ed. 736 (1942)); Southwall Technologies, 54 F.3d at 1576 (claims may not be construed one way in order to obtain a patent and in a different way against an accused infringer); Markman, 52 F.3d at 979-80 ("For claim construction purposes, the description [in the specification] may act as a sort of dictionary, which explains the invention and may define terms used in the claims."); Zenith Lab. v. Bristol-Myers Squibb, 19 F.3d 1418, 1424 (Fed.Cir.) ("The essence of prosecution history estoppel is that a patentee should not be able to obtain, through litigation, coverage of subject matter relinquished during prosecution."), cert. denied, ___ U.S. ___, 115 S. Ct. 500, 130 L. Ed. 2d 409 (1994); Hoganas AB v. Dresser Indus., Inc., 9 F.3d 948, 951 (Fed.Cir.1993) (same); Haynes Int'l, Inc. v. Jessop Steel Co., 8 F.3d 1573, 1577-78 (Fed.Cir.1993) (same). Nothing about the "insubstantial differences" test articulated in Hilton Davis indicates that prosecution history estoppel is no longer relevant; indeed, a prosecution history estoppel inquiry still appears to be the inseparable handmaiden of assertion of doctrine of equivalents infringement. See Modine Mfg. Co., 75 F.3d at 1556 (still considering the extent of prosecution history estoppel under the Hilton Davis "insubstantial difference" test of equivalence); Sofamor, 74 F.3d at 1222 (same); Pall Corp., 66 F.3d at 1218 (same). What the Federal Circuit Court of Appeals did do in Hilton Davis was clarify that when considering prosecution history estoppel, "`a close examination must be made as to, not only what was surrendered, but also the reason for such a surrender,'" in order to determine that estoppel not be over extended to include merely insubstantial differences. Hilton Davis, 62 F.3d at 1525 (quoting Insta-Foam Prods, Inc. v. Universal Foam Sys., Inc., 906 F.2d 698, 703 (Fed.Cir.1990), and finding estoppel did not bar insubstantial differences below a certain pH level, when the prosecution history revealed that the critical distinction being drawn between the invention and prior art was concerning pH levels above a certain level, thus making any differences above that pH level substantial); see also Modine Mfg. Co., 75 F.3d at 1556 (in light of the Hilton Davis "insubstantial difference" test of equivalence, the "available range of equivalency is limited ... by estoppel.... Within this boundary, however, the prosecution history and the prior art do not eliminate equivalents if substantial identity is shown."); Sofamor, 74 F.3d at 1222 ("In addition, prosecution history and prior art may limit Sofamor's assertion of a reasonable likelihood that differences between the '562 patented invention and the MOSS-MIAMI device are insubstantial.... For instance, the trial court properly noted that the '562 patent strove to distinguish itself from prior art with a `separate locking screw [or external nut].' The MOSS-MIAMI device, including its external nut, may fall within the scope of prior art. Thus, these limitations on the doctrine of equivalents may also support the district court's ruling that Sofamor did not show a reasonable likelihood of infringement"; citations omitted); Pall Corp., 66 F.3d at 1218-19 (finding that differences surrendered during prosecution of patent application were necessarily substantial).
Thus, even in light of Hilton Davis, the patentee may not offer an interpretation for the purposes of litigation that would alter the indisputable public record consisting of the claims, the specification, and the prosecution history. Southwall Technologies, 54 F.3d at 1578 (describing such a ploy by the patentee as treating the claims as a "nose of wax"); Zenith Lab., 19 F.3d at 1421 ("Prosecution history serves as a limit on the scope of claims by excluding any interpretation of the claim language that would permit the patentee to assert a meaning for the claim that was disclaimed or disavowed during prosecution in order to obtain claim allowance."). "[T]he limits imposed by prosecution history estoppel can be, and frequently *1300 are, broader than those imposed by the prior art." Haynes Int'l, 8 F.3d at 1579.
In the present case, Smithco has demonstrated to the extent necessary in these provisional proceedings that Rogers asserted in prosecution of the patent application before the PTO that a feature distinguishing his invention from the prior art embodied in BEMCO side-dump trailers was precisely a difference in degree of dumping pivot, his pivoting not more than ninety degrees, as stated in the final limitation of claim 1, and the BEMCO trailers pivoting more than ninety degrees, which Rogers asserted made them unsafe. Rogers' surrender of the scope of the claimed invention as extending to pivots greater than ninety degrees specifically to distinguish prior art renders substantial any difference in pivot exceeding ninety degrees. Hilton Davis, 62 F.3d at 1525 (what is surrendered and the reason it is surrender determine what is a substantial difference surrendered in the course of prosecution of a patent); see also Sofamor, 74 F.3d at 1222 (a patent claim distinguished from prior art on precisely the ground on which an alleged infringing device differed from the patented invention undermined likelihood of success on a doctrine of equivalents infringement claim and supported denial of the preliminary injunction). Therefore, at least on the provisional record before the court, Circle R is estopped from asserting a likelihood of success on any infringement claim based on the doctrine of equivalents.
Counsel for Circle R asserted that even if there was some kind of prosecution estoppel, surely the doctrine of equivalents would still reach a trailer that avoided the claim limitation by only a degree or two. Counsel cited no authority for such a proposition, and the court finds none. Such a conclusion, as the court indicated above, is contrary to, not supported by, the decision in Hilton Davis. Under Hilton Davis, even had such a difference been only "insubstantial" absent any prosecution history, the fact that the difference was the key distinction between the invention and prior art asserted in the prosecution history raises the difference to a level of greater substance. Hilton Davis, 62 F.3d at 1525; see also Sofamor, 74 F.3d at 1222. Circle R eschewed any infringement claim based on any pivot exceeding ninety degrees, and the court will not, in these preliminary proceedings, extend the scope of the patent to recapture anything Circle R has relinquished.
The court concludes, at least for the purposes of Circle R's preliminary injunction motion, that Circle R has failed to show a reasonable likelihood of success on either a literal infringement claim, because the accused device does not embody every limitation of the patent exactly, or a "doctrine of equivalents" infringement claim, because Circle R has failed to prove that the accused device embodies an equivalent it has not eschewed of each claim limitation. Sofamor, 74 F.3d at 1221. Because Circle R has failed to show a likelihood of success on the merits of its infringement claims, either as to validity or infringement, it has failed to satisfy one of the two "central" factors in the preliminary injunction analysis for patent cases. Sofamor, 74 F.3d at 1219; Reebok, 32 F.3d at 1555-56. Likelihood of success on the merits in this case therefore weighs against granting Circle R's motion for a preliminary injunction.
2. Irreparable harm
a. Availability of a presumption
The other "central" factor in the preliminary injunction analysis involves a showing of irreparable harm to the patentee if the injunction is not granted. Sofamor, 74 F.3d at 1219; Reebok, 32 F.3d at 1555-56. Circle R relies on another presumption, like the presumption of validity of its patent, asserting that it is entitled to a presumption of irreparable harm. The Federal Circuit Court of Appeals has repeatedly held that where the plaintiff patentee has demonstrated a likelihood of success on the merits, the patentee is also entitled to a presumption of irreparable harm. See PPG Indus., 75 F.3d at 1566; High Tech Med., 49 F.3d at 1556 ("Reasoning by analogy from decisions involving other forms of intellectual property, this court has held that a presumption of irreparable harm arises when a patentee makes a clear showing that a patent is valid and that it is infringed," citing Roper Corp. v. *1301 Litton Sys., Inc., 757 F.2d 1266, 1271-72 (Fed.Cir.1985)); Reebok, 32 F.3d at 1556 ("We recognize, of course, that a movant who clearly establishes the first factor receives the benefit of a presumption on the second."); H.H. Robertson Co., 820 F.2d at 390; Atlas Powder Co. v. Ireco Chem., 773 F.2d 1230, 1233 (Fed.Cir.1985). Thus, where there is "a strong showing" of likelihood of success on the merits, and that strong showing is "coupled with continuing infringement," a presumption is raised of irreparable harm to the patentee. Reebok, 32 F.3d at 1556.
However, where the court concludes that the patentee is unlikely to succeed on the merits of its infringement claim, the presumption of irreparable harm is inapplicable. PPG Indus., 75 F.3d at 1566 (contrasting cases in which there was no likelihood of success on the merits, such that the presumption did not obtain, and the case before it, in which the presumption could be invoked, because the court concluded there was a sufficiently strong likelihood of success on the merits); High Tech Med., 49 F.3d at 1556 ("The presumption is unavailable here, however, because, as we have discussed, the record does not support [the patentee's] claim that it is likely to succeed in proving that the [accused device] infringes claim 25 of the '001 patent."); Intel Corp., 995 F.2d at 1570 (where a presumption of irreparable harm was based on a likelihood of success finding that was clearly erroneous, the presumption of irreparable harm was also clearly erroneous). Therefore, in Sofamor, the Federal Circuit Court of Appeals concluded that the patentee's reliance on a presumption of irreparable harm was insufficient alone in the circumstances of that case on this second "central" factor: "Because the [patentee] did not show a clear case of likelihood of success on the merits ... its failure to proffer evidence of irreparable harm buttresses the trial court's denial of [the patentee's] motion" for a preliminary injunction. Sofamor, 74 F.3d at 1222-23; High Tech Med., 49 F.3d at 1556 ("Aside from the presumption, the district court pointed to no evidence that would support a finding of irreparable injury, and we find none.").
To put it another way, the presumption of irreparable harm is "rebuttable," and "does not automatically override the evidence of record." Reebok, 32 F.3d at 1556. In fact, the Federal Circuit Court of Appeals has concluded that, like the presumption of validity, what the presumption of irreparable harm does, is "simply act[] ... as a procedural device which shifts the ultimate burden onto the alleged infringer." Reebok, 32 F.3d at 1556 (citing Roper Corp., 757 F.2d at 1272). Thus, a district court may not require the movant to show irreparable harm without first establishing whether the movant is entitled to a presumption of irreparable harm based on a strong likelihood of success on the merits. Reebok, 32 F.3d at 1557. However, when the non-movant bears its burden of showing the lack of irreparable harm sufficiently to overcome the presumption of irreparable harm, the court does not necessarily have to consider likelihood of success on the merits before disposing of a motion for a preliminary injunction on the basis of a lack of irreparable harm. Id. Thus, there is no irrebuttable presumption "`that every patentee is always irreparably harmed by an alleged infringer's pretrial sales,'" because such a rule "`would ... disserve the patent system.'" Reebok, 32 F.3d at 1558 (quoting Illinois Tool Works, 906 F.2d at 683).
In this case, the court has determined not only that Circle R cannot make a "strong" showing of likelihood of success on the merits as to validity and infringement, but that the "likelihood of success" factor in this case weighs against granting a preliminary injunction. Thus, this case falls not within the presumption, but within the group of cases in which Circle R must present some other evidence of irreparable harm. PPG Indus., 75 F.3d at 1566; High Tech Med., 49 F.3d at 1556. The court finds no sufficient showing by Circle R on this factor without the presumption to rely on.
b. When the presumption is not available
When the patentee or the court must look beyond the presumption of irreparable harm, the Federal Circuit Court of Appeals has stated that "[a]lthough a patentee's failure to practice an invention does not necessarily *1302 defeat the patentee's claim of irreparable harm, the lack of commercial activity by the patentee is a significant factor in the calculus." High Tech Med., 49 F.3d at 1556. Factors that have figured in the "irreparable harm" inquiry include whether the patentee's reputation will be injured by the public mistaking inferior, infringing goods, for the patentee's product, Reebok, 32 F.3d at 1557-58 (recognizing that such a harm is often not fully compensated by money damages); whether the patentee or its licensees will be injured by competition from the alleged infringer; whether the patentee runs the risk of loss of sales or goodwill in the market; whether the alleged infringer's activities have or will preclude the patentee from licensing its patent or entering the market, High Tech Med., 49 F.3d at 1556-57; Reebok, 32 F.3d at 1558; Roper Corp., 757 F.2d at 1273; as well as whether the patentee needs an injunction to protect its right to refuse to exploit its invention commercially or to prevent others from doing so; and whether the patentee is willing to forego patent exclusivity by licensing its invention, which "suggests that any injury suffered by [the patentee] would be compensable in damages assessed as part of the final judgment in the case." High Tech Med., 49 F.3d at 1557; T.J. Smith & Nephew Ltd. v. Consolidated Med. Equip., Inc., 821 F.2d 646, 648 (Fed.Cir.1987) (licensing is "incompatible with the emphasis on the right to exclude that is the basis for the presumption [of irreparable harm] in a proper case"). Finally, delay in seeking a remedy is an important factor in the "irreparable harm" inquiry, and argues against the need for a preliminary injunction. High Tech Med., 49 F.3d at 1557.
Although the court considers whether the alleged infringer is costing the patentee sales, potential lost sales alone do not necessarily demonstrate irreparable harm, because every patentee denied a preliminary injunction loses the right to exclude an accused infringer from the market place pending trial, and the circumstances may demonstrate that there is in fact no irreparable harm to the patentee as the result of the alleged infringer's sales. Reebok, 32 F.3d at 1558. Furthermore, the court may consider whether the alleged infringer would be unable to respond in damages for any infringement later found at trial, even though "`the nature of the patent grant weighs against holding that monetary damages will always suffice to make the patentee whole.'" High Tech Med., 49 F.3d at 1557 (quoting Hybritech, 849 F.2d at 1456-57); Reebok, 32 F.3d at 1557 (also citing Hybritech for the proposition that the nature or a patent weighs against finding monetary damages are adequate). The Federal Circuit Court of Appeals has made it clear that "`there is no presumption that money damages will be inadequate in connection with a motion for an injunction pendente lite.'" High Tech Med., 49 F.3d at 1557 (emphasis in the original; quoting Nutrition 21, 930 F.2d at 872). The availability of damages, the Federal Circuit Court of Appeals has held, is "particularly significant when ... the patentee can point to no specific interest that needs protection through interim equitable relief." High Tech Med., 49 F.3d at 1557 (citing Illinois Tool Works, Inc. v. Grip-Pak, Inc., 906 F.2d 679, 683 (Fed.Cir.1990)).
In this case, Circle R's assertion of irreparable harm is the potential sales of its side-dump trailer lost to Smithco. While it could be inferred that Smithco takes away approximately one trailer sale per week from Circle R, based on Smithco's current production, which purportedly falls short of its demand, the court does not find that the loss of such sales is the result of infringement by Smithco. Rather, the Smithco trailers are not infringing, on the evidence currently before the court, and therefore sales of those trailers are not irreparable harms an injunction in a patent case is meant to guard against. Reebok, 32 F.3d at 1558 (circumstances may demonstrate there is in fact no irreparable harm from accused infringer's sales). Rather, such sales are like those lost to other non-infringing competitors, which are a fact of the market place, not a fact of misconduct of the competitor. Where the patentee, here Circle R, cannot show the alleged infringer's activities have or will preclude the patentee from licensing its patent or entering the market, High Tech Med., 49 F.3d at 1556-57; Reebok, 32 F.3d at 1558; Roper Corp., 757 F.2d at 1273, because of the *1303 limited likelihood of success on a claim of infringement, the barrier to the patentee's entry into the market, in this court's view, simply is not attributable to misconduct of the alleged infringer, but only to existing market resistance. Thus, Circle R can point to no specific interest that needs protection from Smithco through interim equitable relief. High Tech Med., 49 F.3d at 1557.
Furthermore, there is no showing that if Circle R should ultimately prevail on its infringement claims against Smithco that Smithco will not be able to respond in damages, and that Circle R will not be adequately compensated by such money damages. Id. Although Circle R argued that it will lose goodwill and repeat business if it loses sales to Smithco, and that economic damages models do not adequately consider such intangible losses, the court reiterates that "`there is no presumption that money damages will be inadequate in connection with a motion for an injunction pendente lite.'" High Tech Med., 49 F.3d at 1557 (emphasis in the original; quoting Nutrition 21, 930 F.2d at 872). Furthermore, because the court has concluded that this is a case in which the patentee can point to no specific interest that needs protection through interim equitable relief, it is a case in which damages after trial are a more appropriate alternative than a pre-trial injunction. High Tech Med., 49 F.3d at 1557.
Thus, without the aid of the presumption of irreparable harm not available to it because of its limited showing of likelihood of success on the merits, Circle R cannot carry its burden on this second "central" factor in the preliminary injunction analysis. Circle R has therefore failed to carry its burden on either of the two "central" factors, which instead weigh against issuance of a preliminary injunction in this case.
3. Balance of harms
Although its conclusions as to the first two factors in the preliminary injunction analysis probably make it unnecessary for the court to reach the remaining two factors, see, e.g., Sofamor, 74 F.3d at 1223; High Tech Med., 49 F.3d at 1554-55; Reebok, 32 F.3d at 1556; New England Braiding, 970 F.2d at 882, the court will nonetheless do so. In considering the third factor in the analysis, the balance of hardships, the court may properly consider whether the patentee would suffer significant harm from the denial of an injunction, while an injunction would be less burdensome for the defendant. PPG Indus., 75 F.3d at 1566. This determination may be based in part on whether the injunction "would require only a temporary interruption in [the defendant's] production and sale" of the allegedly infringing product. PPG Indus., 75 F.3d at 1566.
In the present case, it is apparent that issuance of a preliminary injunction would not maintain the status quo, but would instead inflict very grave hardships on Smithco, and those hardships are not justified by Smithco's having built a business on the basis of an infringing product, while any hardships suffered by Circle R as the result of denial of a preliminary injunction are matters of market place dynamics, not Smithco's alleged infringement. Cf. PPG Indus., 75 F.3d at 1566 (injunction was less burdensome on infringer, as it would require only a temporary interruption in the infringer's production and sale of only one of its products); Windsurfing Int'l, Inc. v. AMF, Inc., 782 F.2d 995, 1003 n. 12 (Fed.Cir.1986) ("One who elects to build a business on a product found to infringe cannot be heard to complain if an injunction against continuing infringement destroys the business so elected."). What Smithco would suffer would not be simply a partial or temporary shutdown of its business, by precluding it from producing and selling one of its products, but the complete shutdown of its business, which depends entirely on the accused product the record so far shows is not in fact infringing, until final determination of Circle R's claims can be made. Id. The court is unwilling to inflict such a complete shutdown of Smithco in light of Circle R's limited showing on likelihood of success on the merits and irreparable harm.
At the preliminary injunction hearing, Circle R attempted to establish that Smithco could simply make non-infringing trailers instead of infringing ones. To this, Mr. Smith stated, "That's what I'm doing now," and this court, having found but limited likelihood of *1304 success on an infringement claim, tends to agree with him. However, just as persuasive is Mr. Smith's assertion that he wasn't sure a shift in production to trailers of a different design could be carried out quickly or economically. Certainly, even a change in the sole item produced by Smithco would involve significant down time in production, disruption to working schedules and pay of employees, additional costs, either of redesigning or retooling, as well as uncertainty about the marketability of the new product, versus the apparently assured sales of the current production line. Again, in light of the limited showing on likelihood of success on an infringement claim thus far made by Circle R, the court is unwilling to disregard these disruptions to Smithco's business.
Thus, this third factor, as have the preceding ones, weighs in favor of denial of Circle R's request for preliminary injunctive relief during the pendency of this action.
4. Public interest
Finally, the court turns to consideration of the "public interest." The public interest also involves a balancing, this time of whether an injunction would deprive the public of one supplier of a useful product, balanced against "the strong public policy favoring the enforcement of patent rights." PPG Indus., 75 F.3d at 1566. Undeniably, an injunction would deny the public of one supplier, Smithco, of a useful product, a side-dump trailer apparently enjoying significant market demand, while there is little public policy interest favoring enforcement of patent rights when there is only a limited showing of the validity of the patent and its infringement. Thus, the public interest is either flat or favors the continued operation of Smithco during the pendency of this litigation.
III. CONCLUSION
The court concludes that presumptions alone are insufficient to carry the day for Circle R's motion for a preliminary injunction. To the contrary, Smithco has raised substantial questions as to the validity of both claims 1 and 2 of the '214 patent at issue here, owing to persuasive evidence of an "on-sale" bar to the patent, which is sufficient to overcome the presumption of validity for preliminary injunction purposes. Smithco's showing therefore undercuts Circle R's likelihood of success on the merits of its claims as to validity of the patent in suit. Furthermore, the court concludes that Circle R has demonstrated little likelihood of success on claims of either literal or "doctrine of equivalents" infringement. The Smithco trailers, according to the evidence so far presented, do not infringe the final limitation of claim 1 of the patent, and hence cannot infringe claim 2, which is a dependent claim, because they do not employ a degree of pivot that is not greater than ninety degrees, but instead employ a slightly larger degree of pivot. Circle R cannot recapture this slight difference under the doctrine of equivalents, because it specifically eschewed expansion of the scope of its claim in prosecution of the patent by distinguishing prior art on the basis that the prior art employed a degree of pivot in excess of ninety degrees. Because it cannot rely on the presumption of irreparable harm that arises from a strong showing of likelihood of success, and further evidence of irreparable harm is insufficient, the court concludes that Circle R cannot satisfy the first two "central" factors of a preliminary injunction analysis in a patent case.
Nor, the court concludes, can Circle R satisfy the final two requirements, a balance of harms favoring Circle R and public interest favoring an injunction. While Circle R may suffer some loss of sales to competing trailers made by Smithco, that loss of sales is not the result of misconduct in the form of infringement by Smithco. On the other hand, Smithco would be required to cease operations entirely or disrupt those operations drastically if its production of its sole product, its side-dump trailer, were enjoined. The court is unwilling to inflict such harm on Smithco in light of Circle R's limited showing that Smithco's product infringes Circle R's patent. Finally, the court finds no public interest favoring an injunction in this case where there is no strong likelihood that a valid patent is being infringed.
Because all four factors in the analysis of whether a preliminary injunction should issue *1305 in a patent case weigh against issuance of such an injunction, or are simply "flat," Circle R's motion for a preliminary injunction is hereby denied. Furthermore, because an adequate foundation for challenged photographic evidence was laid, and that photographic evidence is relevant, if entitled to but little weight, Circle R's further motion to strike evidentiary materials is also denied.
IT IS SO ORDERED.
NOTES
[1] Although originally assigned to Senior Judge Donald E. O'Brien, on January 22, 1996, Judge O'Brien entered an order transferring this case to my docket.
[2] Claim 1 of the '214 patent reads as follows:
1. A side dump trailer, comprising:
an elongated wheeled frame having a forward end, a rearward end, and opposite sides;
a first support on said wheeled frame adjacent the forward end thereof at one side thereof;
a second support on said wheeled frame adjacent the rearward end thereof at the one side thereof;
a third support on said wheeled frame adjacent the forward end thereof at the other side thereof;
a fourth support on said wheeled frame adjacent the rearward end thereof at the other side thereof;
an elongated body movably positioned on said wheeled frame and having a forward end, a rearward end, opposite sides, and an open upper end for receiving materials to be transported;
said body including a substantially flat, horizontally disposed bottom wall having a forward end, a rearward end, and first and second opposite side edges;
said body also including an upstanding forward wall member, an upstanding rearward wall, and first and second side walls which extend upwardly and outwardly from the first and second side edges of said bottom wall;
a first, horizontally disposed pivot pin secured to said first side wall of said body adjacent the forward end thereof adapted to be removably and pivotally received by said first support;
a second, horizontally disposed pivot pin secured to said first side wall of said body adjacent the rearward end thereof adapted to be removably and pivotally received by said second support;
a third, horizontally disposed pivot pin secured to said second side wall of said body adjacent the forward end thereof adapted to be removably and pivotally received by said third support;
a fourth, horizontally disposed pivot pin secured to said second side wall of said body adjacent the rearward end thereof adapted to be removably and pivotally received by said fourth support;
said first, second, third and fourth pivot pins being elongated and having their axes disposed parallel to the length of said body and said wheeled frame;
said first, second, third and fourth pivot pins being positioned on the respective side walls above said bottom wall and outwardly of said side walls;
first, second, third and fourth locking devices selectively movable between locked and unlocked positions for selectively maintaining said first, second, third, and fourth pivot pins in said first, second, third and fourth supports respectively when in their locked positions;
a first power cylinder having a base and pivotally secured to said wheeled frame intermediate the sides thereof forwardly of said body and a rod end pivotally secured to said forward wall member of said body intermediate the sides thereof;
a second power cylinder having a base end pivotally secured to said wheeled frame intermediate the sides thereof rearwardly of said body and a rod end pivotally secured to said rearward wall of said body intermediate the sides thereof;
and means for simultaneously selectively extending the rods of said first and second power cylinders whereby said body will dump the material therein from said one side of said body when said first and second locking devices are in their locked positions and said third and fourth locking devices are in their unlocked positions and whereby said body will dump the material therein from said other side of said body when said third and fourth locking devices are in their locked positions and said first and second locking devices are in their said unlocked positions;
the angular relationship of said side walls with respect to said bottom wall, together with the relationship of said pivot pins with respect to said side walls and said bottom wall, enabling the material in said body to be dumped therefrom, when positioned in its dumping positions, without the necessity of pivotally moving said body greater than 90ฐ from its non-dumping position.
[3] Claim 2 of the '214 patent reads as follows:
2. The side dump trailer of claim 1 wherein each of said locking devices includes a side which is selectively movable into engagement with its associated pivot pin to prevent the upward movement of the pivot pin relative to the associated support while permitting pivotal movement of the pivot pin with respect to the support, each of said slides including means for locking said slide in its locked position.
[4] Apparently to counter Circle R's assertions that the photographic evidence of these three early trailers was without foundation and irrelevant, Smithco presented at the hearing the testimony of Charles Bastian, the photographer who took the photographs at American Contracting Company in Dickinson, North Dakota, where the trailers are currently in use after having been sold to American Contracting by Smith Trucking. During an extensive voir dire examination of this witness by Circle R's counsel, Mr. Bastian testified that the trucks were on ground that was "fairly level" during the photographing, and that, as far as he could tell, the tubs of the trailers were pivoted to full dumping position for photographs in the dumping position. The court concludes that adequate foundation for the photographs was laid by Mr. Bastian's testimony, that the photographs are relevant, as they are probative of the questions at issue in this application for a preliminary injunction, and that they are therefore admissible, although the weight to be given such photographs may nonetheless be very slight. Circle R's motion to strike evidentiary materials will therefore be denied.
[5] These equitable inquiries are not unlike the factors considered in this circuit for the issuance of preliminary injunctions or temporary restraining orders in non-patent cases. Accord High Tech Med., 49 F.3d at 1554 (observing that the Federal Circuit Court of Appeals "has made clear that the standards applied to the grant of preliminary injunctions are the same in patent cases as in other areas of the law," citing H.H. Robertson, 820 F.2d at 387). The Eighth Circuit standards for issuing either a temporary restraining order or a preliminary injunction are set out in the seminal decision of Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109, 113 & n. 5 (8th Cir. 1981) (en banc). One recent formulation of the Dataphase standards is as follows:
When considering a motion for a preliminary injunction, a district court weighs the movant's probability of success on the merits, the threat of irreparable harm to the movant absent the injunction, the balance between the harm and the injury that the injunction's issuance would inflict on other interested parties, and the public interest. Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109, 114 (8th Cir.1981) (en banc). We reverse the issuance of a preliminary injunction only if the issuance "is the product of an abuse of discretion or misplaced reliance on an erroneous legal premise." City of Timber Lake v. Cheyenne River Sioux Tribe, 10 F.3d 554, 556 (8th Cir.1993), cert. denied, ___ U.S. ___, 114 S. Ct. 2741, 129 L. Ed. 2d 861 (1994).
Pottgen v. Missouri State High Sch. Activities Ass'n, 40 F.3d 926, 929 (8th Cir.1994).
[6] Although incompleteness of relevant findings "does not necessarily require that [the appellate court] vacate the district court's order and remand for further fact finding," Reebok, 32 F.3d at 1555, plainly, it would be better for this court to make adequate findings of fact on each factor to establish not only the propriety of its disposition of the motion for a preliminary injunction, but to facilitate appellate review, if any is required.
[7] Circle R contends that In re Mann, 861 F.2d 1581 (Fed.Cir.1988), stands for the proposition that "[t]he law ... recognizes that such testing and development may encompass or even require disclosure to the public, without barring the inventor's access to the patent system." However, In re Mann involved an alleged "on-sale" bar to an ornamental design patent for a table, which the court found barred by the inventor's display of the design at a trade show more than one year prior to the patent application. In re Mann, 861 F.2d at 1581-82. The court concluded, "We see no way in which an ornamental design for an article of manufacture can be subject to the "experimental use" exception applicable in the case of functioning machines, manufactures, or processes. Obtaining the reactions of people to a design โ whether or not they like it โ is not `experimentation' in that sense." Id. at 1582. Thus, because In re Mann involves a finding of no experimental use, and was a case involving an ornamental design, which it distinguished from the kind of "functioning machine" design involved in this case, In re Mann is not helpful to Circle R's position. Furthermore, the case does not suggest that testing and development may encompass or even require disclosure to the public, as Circle R would have it.
[8] The court observes, however, that Smithco has raised a substantial question as to whether or not Rogers should have disclosed these early sales to the PTO over Rogers' assertions that he did not have to disclose sales he believed were merely "experimental." In LaBounty, the court was confronted with a similar situation, and held that the inventor's perception that he could reasonably conclude that certain sales were experimental "makes it all the more necessary that the devices should have been disclosed to the examiner. Close cases should be resolved by disclosure, not unilaterally by the applicant." LaBounty, 958 F.2d at 1076.
[9] Whether none, some, or all of the material in the tub of the side-dumper would actually dump out in such a scenario is beside the point. The patent also does not state that material will actually be dumped out, but instead only discusses the relative start and finish positions of the dumper tub.
[10] As to "designing around" the patent, in Roton Barrier, the Federal Circuit Court of Appeals wrote,
In discussing the relevance of designing around to the issue of infringement under the doctrine [of equivalents], we stated that "[d]esigning around `is the stuff of which competition is made and is supposed to benefit the consumer.'" [Hilton Davis, 62 F.3d] at 1520, 35 USPQ2d at 1646 (quoting State Indus., Inc. v. A.O. Smith Corp., 751 F.2d 1226, 1236, 224 U.S.P.Q. (BNA) 418, 424 (Fed.Cir.1985)). In addition, when a competitor is aware of a patent and attempts to design around it, "the fact-finder may infer that the competitor ... has designed substantial changes into the new product to avoid infringement" under the doctrine. Id. [62 F.3d] at 1520, 35 USPQ2d at 1646-47.
Roton Barrier, 79 F.3d 1112, 1126. Although the parties' arguments appeared to touch on the question of whether Smith "designed around" the '214 patent, or at least around the Rogers design, the court finds that it need not here address a "designing around" argument in order to dispose of the motion for a preliminary injunction in this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580894/ | 5 Mich. App. 492 (1967)
147 N.W.2d 469
CHESAPEAKE & OHIO RAILWAY COMPANY
v.
PUBLIC SERVICE COMMISSION.
Docket Nos. 822, 823.
Michigan Court of Appeals.
Decided January 10, 1967.
Rehearing denied February 17, 1967.
Remanded for further proceedings June 8, 1967.
January 11, 1968.
*495 Paul C. Younger, Allan F. Schmalzriedt, and John J. Holden, for Chesapeake & Ohio Railway Company.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Hugh B. Anderson and David P. Van Note, Assistant Attorneys General, for Attorney General, and for Public Service Commission.
Steven L. Dykema, City Attorney, for City of Grand Rapids.
Roger P. O'Connor, Assistant Corporation Counsel, for City of Detroit.
Richard L. Spindle, City Attorney, for City of Wyoming.
Jacob I. Alspector, for Railroad Brotherhoods.
Remanded by Supreme Court to circuit court for further proceedings June 8, 1967. See 379 Mich. 764.
Leave to appeal granted by Supreme Court January 11, 1968. See 380 Mich. 752.
McGREGOR, J.
In November, 1964, the C & O Railway announced to the public, by newspaper advertisements, that its passenger trains, 14 and 15, which ran daily except Sunday between Grand Rapids and Detroit, would be discontinued on January 3, 1965. At the time the discontinuance was announced, C & O operated three pairs of passenger trains between Detroit and Grand Rapids. The first pair were train 14, which left Grand Rapids *496 at 7:30 a.m. and arrived at Detroit at 10:30 a.m., and train 15, which left Detroit at 5:20 p.m. and arrived at Grand Rapids at 8:25 p.m., both of which made regular stops at Plymouth and Lansing. The second pair were train 11, which left Detroit at 8:30 a.m. and arrived at Grand Rapids at 11:35 a.m., and train 12, which left Grand Rapids at 3:30 p.m. and arrived in Detroit at 6:30 p.m. The third pair were train 19, which left Detroit at 11:40 p.m. and arrived at Grand Rapids at 2:55 a.m., and train 20, which left Grand Rapids at 10:10 p.m. and arrived in Detroit at 2:20 a.m.
The relevant statutory provision, before it was amended by PA 1965, No 15 (Stat Ann 1965 Cum Supp § 22.32[c]), read as follows:
"Passenger service shall not be discontinued in this state without the permission of the commission and unless the railroad desiring to discontinue such service shall first file a petition with the commission, and hearing is held thereon as provided in section 22 of this act. The commission at such hearing shall inquire into the convenience and necessity of the service to the public and shall render its decision thereon. At any hearing upon such petition any person, association, corporation, municipality or governmental unit whose interests shall be adversely affected by the discontinuance of the service may petition the commission for leave to intervene in said proceedings and participate therein as a party. If it shall appear to the commission from the state of said applicant's interests that said interests may be adversely affected by the discontinuance of service, the commission shall grant permission to intervene; Provided, however, That the provisions of this act shall not apply to the revision of passenger service schedules, the consolidation of passenger trains, temporary or seasonal trains, nor to any railroad operating more than 2 passenger trains in each direction on a week day on the portion *497 of the railroad affected." CL 1948, § 462.13(c) (Stat Ann 1963 Cum Supp § 22.32[c]).
On December 21, 1964, the public service commission held a hearing on the proposed discontinuance of trains 14 and 15, at which time evidence was heard on the question of the effect on the public of the discontinuance of said trains and also on the issue of whether or not trains 19 and 20 were, in fact, passenger trains. Under the statute as it was then in effect, the public service commission had no authority to act in the matter if in fact the C & O railroad was operating three trains daily each way between the cities in question.
By its order of December 23, 1964, the public service commission ordered the railroad to continue the operation of trains 14 and 15. The commission held that because trains 19 and 20 were not really passenger trains, the railroad operated only two passenger trains within the meaning of the statute and, therefore, was not exempted from the jurisdiction of the commission. The commission found that in June of 1960, the C & O railroad started operating trains 19 and 20 for the carriage of mail, pursuant to a contract with the Federal government. Shortly after these trains were commenced, the railroad attached to them a passenger coach of an obsolete type. Within a few months, this coach was replaced by a combination passenger, mail, express, and baggage car. The commission found that this passenger coach was put on to the train to obtain a small amount of passenger revenue, to provide carriage for trainmen since a caboose could not be used at the high speeds at which trains 19 and 20 operated, and also to save crew wages since the union contracts provided for lower wages for employment on trains classified as passenger trains *498 than that paid for employment on freight trains. The commission's opinion read in part as follows:
"We find that the railroad's original and continuing purpose in attaching a combination coach to trains 19 and 20 was and is to achieve savings in crew costs and to provide a place for trainmen to ride. The fulfilling of a public need for transportation service at midnight and the obtaining of passenger revenues were and are no more than secondary or incidental reasons for the addition of a combination coach to trains 19 and 20.
"The passenger coach presently used on trains 19 and 20 is a combination passenger and baggage car, containing 28 seats instead of the more usual 56 seats. The combination car is ordinarily used only on trains 19 and 20, and no other coaches are ordinarily used on such trains. Other equipments on trains 19 and 20 include a locomotive, a railway postal office, and six `road railers,' which are mail cars capable of being pulled on the public highways by tractors. By way of contrast, trains 11 and 12, and 14 and 15 consist of a locomotive, mail car, diner, 2 or 3 passenger coaches, and 1 or 3 road railers.
"During the first 10 months of 1964, trains 19 and 20 handled 2,535 passengers and obtained passenger revenue of $9,500, an average of five passengers and $18 revenue per trip. * * *
"The revenue derived from mail, express, and other commodities on trains 19 and 20 is at least 20 times that derived from the transportation of passengers. In our opinion, the number of passengers and the amount of passenger revenue on trains 19 and 20 are de minimis. Trains 11 and 12 earned passenger revenues of $164,300 and trains 14 and 15 earned passenger revenues of $188,900 in the first 10 months of 1964.
"We can only infer from the railroad's refusal to provide a monthly breakdown of the number of passengers on trains 19 and 20 that such a breakdown *499 would show a seasonal pattern in patronage of the trains, with the vast majority of the riders concentrated in the summer months, and particularly on days of night baseball games in Detroit. A commission staff member testified to having ridden train 19 from Detroit to Grand Rapids on Friday, December 18, 1964, and being the only passenger on such train, other than the commission's counsel, who accompanied him. Thus, even if trains 19 and 20 could be considered `passenger trains', within the meaning of the proviso clause of section 13 (c) of the railroad act, the railroad has failed to show that such trains are not seasonal trains, and therefore, not properly to be considered as part of the two passenger trains in each direction.
"The railroad provides no special facilities or services for passengers riding trains 19 and 20. Baggage may not be checked, but must be carried by the passenger himself into the combination car, and placed on a rack or seat. No ticket sellers or porters are on duty at the Detroit depot at or shortly before the time of departure of train 19. No ticket sellers or other attendants are on duty in Lansing after 8 p.m. No railroad personnel are present at Grand Rapids upon the arrival of train 19 to assist or receive passengers. However, a large number of employees are present at both the Lansing and Grand Rapids depots for the receipt and handling of mail in connection with train 19. In Grand Rapids, more than a dozen employees assist in the handling of mail arriving on train 19. In contrast, there are ticket sellers in Detroit, Lansing, and Grand Rapids, and porters at Detroit, to accommodate passengers taking the daytime trains. As shown by the train schedules recited earlier in this opinion, trains 19 and 20 require 5 to 15 minutes longer to make the Detroit-Grand Rapids trip than do the other trains on that route, due to the longer stop at Lansing for the handling of mail. * * *
"Even if trains 19 and 20 are not seasonal trains within the meaning of the act, we find that such *500 trains are not passenger trains within the meaning of the proviso clause of section 13 (c). It is obvious that the description given by a railroad to a train, whether passenger or freight, is not determinative of the question of whether the train is a passenger train within the meaning of the act. The legislature did not intend that the commission's jurisdiction and duty to insure adequate passenger service in this State be defeated by mere semantics. Also clear is that the mere publishing of a passenger tariff for a particular train and the providing of a place for passengers on such train, no matter how limited in size or facilities, do not make a freight or mail train into a passenger train within the meaning of the act. `Passenger trains,' as used in the act, mean trains which earn a substantial portion of their revenue from the transportation of passengers, which are scheduled to meet the needs and convenience of the traveling public, and which are operated at least in major part for the purpose of providing transportation to the public. * * * As detailed throughout this opinion, trains 19 and 20 were placed into operation for the purpose of transporting mail; the addition of a passenger car thereto, and the publishing of passenger tariffs and schedules were for purposes almost entirely disassociated from the desire to engage in the business of transporting passengers on such trains; almost none of the usual depot and on-train facilities and personnel are available to passengers on such trains; and the number of passengers and the revenue therefrom are insignificant when compared with the passengers and revenues on trains 11 and 12 and 14 and 15, or when compared with the revenues from mail, express, and other commodities handled by trains 19 and 20. Trains 19 and 20 are essentially mail or freight trains which only incidentally handle passengers, and then for reasons not related to the needs or convenience of the traveling public or the revenues that might be derived from the transportation thereof."
*501 The December 23, 1964, order of the public service commission occasioned two separate lawsuits. On December 31, 1964, the city of Grand Rapids filed a complaint, with a copy of the commission's order attached, in the superior court of Grand Rapids, alleging that the railroad intended to discontinue trains 14 and 15, and that such action would irreparably injure the city of Grand Rapids and its citizens by depriving them of the use of the trains and by causing economic loss to its businesses. Pursuant to Grand Rapids' prayer for relief, the court issued an order to show cause and a temporary restraining order prohibiting the railroad from discontinuing trains 14 and 15 without approval of the public service commission. On January 15, 1965, the circuit court for the county of Kent, to which the cause had been transferred on January 1, 1965,[1] allowed the public service commission, the attorney general, the city of Detroit, the city of Wyoming, and the city of Lansing to intervene in the actions as parties-plaintiff. The complaints of the intervening plaintiffs adopted substantially the complaint of the original plaintiff. Upon motion of the railroad, the court, while continuing the temporary restraining order, transferred the cause to the Ingham county circuit court, where it was assigned number 2856-C.
The other suit was instituted on January 12, 1965, when the railroad filed a complaint with the Ingham county circuit court, assigned number 2758-C, pursuant to the appeal provision of CLS 1961, § 462.26 (Stat Ann 1965 Cum Supp § 22.45), asking that the commission's order be vacated and the commission be enjoined from enforcing the order. A copy of the commission's order was attached to the complaint. The court permitted *502 the city of Lansing, the city of Wyoming, the city of Detroit, the city of Grand Rapids, and the railroad brotherhoods to intervene as parties-defendant. The commission counterclaimed, asking that the court order enforcement of its order of December 23, 1964. On February 11, 1965, the court heard the cross-motions of the parties for preliminary injunction, the railroad asking for preliminary injunction restraining enforcement of the commission order, and the commission asking that the railroad be restrained from discontinuing trains 14 and 15 pending final decision in the case. On April 7, 1965, Ingham county circuit court issued an opinion in case No. 2758-C, which held that trains 19 and 20 were passenger trains within the meaning of CL 1948, § 462.13 (Stat Ann 1963 Cum Supp § 22.32). In part, the court held in its opinion as follows:
"In this court's opinion, the principal point and aim of the statute is the regulation of `passenger service' and when the legislature used the term `passenger trains' in the proviso of the statute it did so as being synonymous of `passenger service' as used in the body of the statute, and further, that if bona fide passenger service was offered on a train then that train for the purposes of the act would be a passenger train. If the legislature had intended otherwise it seems it would have either used the term `passenger trains' in the body of the statute or would have gone further and set forth the intended distinction.
"As to trains 19 and 20, it is clear that plaintiff has operated them on a regular schedule between Detroit and Grand Rapids for a period of upwards of four years; that passenger service time tables have been published and distributed to the public generally during this time concerning said trains; that 2,535 passengers were carried thereon during the first 10 months of 1964, with a revenue therefrom *503 amounting to $9,500 and that there has been a continued `holding out' to the public that said trains offered passenger service. It seems clear from the foregoing that a bona fide passenger service has been and is being offered on trains 19 and 20, whether said service is secondary or incidental to any other reason for running said trains, and meets the meaning of `passenger service' and `passenger trains' as used in the statute.
"Let us go on and determine whether trains 19 and 20 are in fact passenger trains within the meaning of decided cases and other authority. Black's Law Dictionary, page 1335, defines passenger trains as:
"`Any train used to carry members of the general public for hire.' Adams v. Yazoo & M.V.R. Co., 115 Miss 865 (76 So 733, 734); Power v. Gainesville & N.W.R. Co., 16 Ga App 732 (86 S.E. 61); Kansas City & M.R. Co. v. Huff, 116 Ark 461 (173 S.W. 419, 421); Nadler v. Illinois Commercial Men's Ass'n, 188 Ill App 459, 460; Chicago B. & Z.R. Co. v. Railroad Commission of Wisconsin, 152 Wis 654 (140 N.W. 296, 299).
"74 CJS, Railroads, § 1, p. 336, provides:
"`Passenger train. * * * Ordinarily it signifies a train advertised to take passengers generally, people traveling from place to place, on the terms and in the manner ordinarily applicable to such passengers, their baggage, mail, and express only. * * * While accommodation freight trains are not passenger trains in the ordinary sense of the terms, and the carrying of passengers in a caboose attached to a freight train does not change the freight train into a passenger train, the term `passenger train' need not be applied only to a train devoted exclusively to the transportation of passengers. A train is still a passenger train if it has all the facilities and conveniences for passengers which the law requires, even though the carrier may transport at the same time and on the same train shipments of freight.'
*504 "Trains 19 and 20 appear to come within the foregoing definitions. In the final analysis there appears to be no material distinction between plaintiff's trains 19 and 20 and plaintiff's other trains which are conceded to be passenger trains. The difference lies only in quality and quantity. Plaintiff's other trains by virtue of schedule carry many more passengers and presumably for the same reason less `road railers' than do trains 19 and 20. Trains 19 and 20 for the same reason carry more `road railers' and fewer passengers than plaintiff's other trains. All of plaintiff's trains in this court's opinion are mixed trains operated as passenger trains within the definitions and cases cited in support of the definition as well as the statute.
"Also it appears to the court that it cannot be said that the passenger service offered on trains 19 and 20 due to the small number of persons carried or the manner in which it originated is subordinate to other service offered on said trains. Regardless of the number of persons carried or how the service came about or the volume of freight carried, the passenger service has been `held out' and carried on as such and in a sense independent of other services offered on said trains. * * *
"The commission also concluded in its order that plaintiff's trains 19 and 20 are seasonal trains and therefore plaintiff is not exempt from petitioning before discontinuance of trains 14 and 15. The defendants appear to have abandoned the commission's conclusion in this regard. However, in the event that they have not, this court concludes that it appears from all of the foregoing that passenger service on trains 19 and 20 is not offered seasonally and is not seasonal but is offered and carried out on a regular basis and said trains are not seasonal trains within the meaning of the statute.
"The final question before the court is whether it should now issue an injunction. The usual defenses to a temporary injunction, such as maintaining the `status quo,' `irreparable injury,' and the *505 balancing of equities have been asserted. However, such defenses appear not to be applicable under the circumstances in this case. The issue before the court has been and is one of law only, namely, whether the commission correctly interpreted the statute. It has been determined that it did not, and that determination is decisive. Thus, it is concluded that an injunction issue now which will be labeled a temporary injunction, but which in reality finally disposes of the case in this court."
The court's opinion was based upon the pleadings filed in this case, and also the hearing record and opinion order of the public service commission. On the same date, the court issued an opinion in case No. 2856-C, which held that its opinion in case No. 2758-C was controlling and, therefore, the plaintiffs in the case transferred from Grand Rapids were not entitled to relief. Pursuant to these two written opinions, the court, on April 19, 1965, issued a final judgment in case No. 2856-C, which adjudged that the plaintiffs were entitled to no relief, and in case No. 2758-C issued a temporary restraining order which enjoined the public service commission from enforcing its order barring discontinuance of trains 14 and 15 by the Chesapeake & Ohio Railway.
This case is further complicated by the fact that the public service commission was successful in having rushed through the legislature PA 1965, No 15 (Stat Ann 1965 Cum Supp § 22.32[c]), which amended CL 1948, § 462.13 (Stat Ann 1963 Cum Supp § 22.32) by eliminating the provisions which excepted from the jurisdiction of the public service commission railroads operating more than two passenger trains in each direction on the portion of the railroad affected by changes in passenger service schedules. This act took immediate effect on April 16, 1965, upon signing by the governor. The commission's motions in each case to dismiss the action for *506 mootness on the theory that the railroad's defense was eradicated by statutory amendment were denied by the circuit court. The public service commission then appealed to this Court by a claim of appeal in No. 2856-C and under the grant of application for leave to appeal in No. 2758-C. The circuit court granted a stay of its temporary injunction issued in the latter case, pending appeal to this Court.
The first issue requiring decision by this Court is whether the exemption, under paragraph (c) of CL 1948, § 462.13 (Stat Ann 1963 Cum Supp § 22.32) is lost by legislative elimination of the exemption while the railroad is prevented from exercising its rights under the exemption by a temporary injunction. PA 1965, No 15 contains nothing which indicates that the legislature intended it to have any retroactive application. It is a fundamental principle of statutory construction that statutory amendments not be given any retroactive effect unless the legislature clearly and unequivocally indicates otherwise. In re Davis Estate (1951), 330 Mich. 647; Finn v. Haynes (1877), 37 Mich. 63. The statutory amendment during the pendency of a suit has no bearing upon the rights of the parties fixed by law before its enactment. Lippman v. Cort (1927), 240 Mich. 366; Taylor v. Burdick (1948), 320 Mich. 25. If the Chesapeake & Ohio Railway's passenger operation between Detroit and Grand Rapids was exempt from the control of the public service commission in regard to the change of passenger schedules, by virtue of its operating three passenger trains on that section of the railroad in question, then the railroad has not lost that right because its exercise has been delayed by the legal action of the public service commission and certain Michigan municipalities.
This Court is then faced with the issue of whether or not trains 19 and 20 are passenger trains within *507 the meaning of the statutory section herein at issue. Words and phrases are supposed to be construed according to their common meaning. (CLS 1961, § 8.3a [Stat Ann 1961 Rev § 2.212(1)].) What, then, is commonly understood by the term "passenger train"? In Commissioner of Railroads v. Wabash R. Co. (1900), 123 Mich. 669, 671, it was held that a passenger train consisted of its passenger, baggage, express, and mail cars. It would seem, therefore, that the carriage of baggage, express, and mail in no way prevents a train from being termed a passenger train. Upon examination of the cases cited in 31A, Words and Phrases, Passenger Train, pp 87-89, it would seem that a passenger train is a train which is available for and actually used to carry passengers from among the general public on a regular schedule and which is held out or advertised to the public as such. The findings of the public service commission, as stated in their order of December 23, 1964, indicate that trains 19 and 20 were not used for carrying freight, had been in operation on a regular schedule since June of 1960, and were continually available for and actually did carry passengers, although at hours not likely to promote their use. The trial court was correct in its determination that trains 19 and 20 were passenger trains. The matter was, therefore, outside of the jurisdiction of the public service commission.
At this point, the first procedural question raised by the appellant public service commission enters into the picture. The appellant commission contends that the final judgment of the circuit court in case No. 2856-C deprived it of a trial on the merits with an opportunity to introduce further evidence, and also deprived it of the chance to make use of the discovery and pretrial procedures outlined by the general court rules. The examination of the complaints of the parties in case No. 2856-C reveals that, *508 under the court's interpretation of the term "passenger train," the parties plaintiff failed to state a cause of action. The complaints of the plaintiffs all alleged that the public service commission had held a hearing to determine whether or not the Chesapeake & Ohio Railway was operating three passenger trains each way between Detroit and Grand Rapids, and had issued an order requiring continuance of the operation of trains 14 and 15, and that there was reason to believe that the railroad would not comply with the said order. Since this Court has held that the public service commission lacked jurisdiction on the basis of its own factual findings, the necessary conclusion is that the parties plaintiff in case No. 2856-C have failed to show a claim for relief, and therefore, their complaints would have been subject to dismissal upon the grounds of lack of jurisdiction.
The appellant public service commission also contends, as a second procedural question, that the trial court erred in issuing a temporary injunction based on the court's view of the ultimate merits of the litigation, and without regard to preservation of the status quo, or prevention of irreparable injury. The commission has cited numerous authorities to support its contention that the only purpose of temporary injunction is to maintain the status quo, and that the status quo before litigation was the continued operation of trains 14 and 15. It is clear that the trial court followed an irregular procedure in stating that the temporary injunction which it was going to issue was really not temporary at all, but was a final adjudication. Having held in case No. 2856-C that the complaints based upon the same commission order at issue in case No. 2758-C failed to state a cause of action, the same conclusion must follow in case No. 2758-C, since both cases involve the same parties. In any event, the appellant can *509 not be heard on appeal to claim that the granting of an injunction in appellees' favor is reversible error, as both parties sought injunctive relief in the trial court.
The trial court was right in the merits and the outcome could not possibly be different upon a fulldress trial, without or with a discovery and other pretrial proceedings. The procedural defects below shall be corrected by entry in this Court, in case No. 2856-C, of a dismissal for lack of jurisdiction, and in case No. 2758-C by issuance of an order vacating the order of the public service commission dated December 23, 1964, with a permanent injunction against the enforcement of this order.[2] No costs, a public question being involved.
LESINSKI, C.J., and T.G. KAVANAGH, J., concurred.
NOTES
[1] See PA 1964, No 262, amending CLS 1961, § 600.518 (Stat Ann 1965 Cum Supp § 27A.518). REPORTER.
[2] GCR 1963, 820.1(7). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581186/ | 919 F. Supp. 870 (1996)
Rita J. NOVAK, Plaintiff,
v.
Donald P. MACKINTOSH and Dakota Industries, Inc., Defendants.
No. CIV 95-4051.
United States District Court, D. South Dakota, Southern Division.
January 30, 1996.
*871 *872 Bonnie P. Ulrich, U.S. Attorney's Office, Sioux Falls, SD, for plaintiff.
James A. Hertz, Christopherson, Bailin & Anderson, Sioux Falls, SD, for defendant.
ORDER
PIERSOL, District Judge.
Defendants move for summary judgment on the complaint brought pursuant to the Veterans' Reemployment Rights Act, 38 U.S.C. §§ 2021-27.[1] Doc. 36. Defendants *873 allege that Plaintiff's dismissal was unrelated to her military duties and that her failure to return to work or apply for reinstatement after her dismissal jurisdictionally bars her suit. Doc. 37 at 3-4. Defendants request, in the alternative, that Defendant Donald P. Mackintosh be dismissed as an improper party. Doc. 37 at 6. Defendants' Motion for Summary Judgment is denied for the following reasons.
FACTS
Plaintiff Rita Novak, who is represented by the United States Attorney in this action,[2] began work for Dakota Industries, Inc., on March 28, 1989. Complaint at ¶ 5; Mackintosh Deposition at 27 [hereinafter "Mackintosh"]. Novak was a member of the National Guard at the time she went to work for Dakota Industries, and she served in Operation Desert Storm from November 21, 1990, through June 3, 1991. Complaint at ¶ 6; Order 123-04. Upon her return to Dakota Industries, Novak was reemployed, paid $6.50 an hour, and given reduced responsibilities.[3] Complaint at ¶ 6; Mackintosh at 48. For the time period beginning with her departure for Desert Storm and ending with her termination from Dakota Industries, Novak had military obligations on November 19 & 20, 1990,[4] and on January 24, 1992. Declaration of Mark P. Snoozy, Commanding Officer, 323rd Chemical Company [hereinafter "Snoozy"], Doc. 47 at ¶ 6.
On January 16, 1992, Novak informed Mackintosh that she would not be at work on January 23, 1992, because she had a dental appointment,[5] and she informed him that she probably would not be at work on January 24, 1992, because she had a military training *874 class. Answer, Doc. 7 at ¶ 7; Complaint, Doc. 1 at ¶ 7; Declaration of Rita J. Novak, Doc. 48 at 6. On January 22, Mackintosh refused Novak permission to keep the dental appointment, and, with respect to her military obligation, told her that if she was going to obey her training orders, she was to turn in her keys.[6] Mackintosh at 97-98. Mackintosh called Novak's commanding officer on January 22 and threatened to fire her if she was not at work on Friday, January 24. Snoozy, Doc. 47 at 2; Mackintosh at 97.[7] Novak kept her dental appointment and her military obligation in Salt Lake City as ordered. Doc. 48 at 7. Novak received a check on January 25 with the notations, "Final Check" and "This represents final and total payment for all amounts due form Dakota Industries, Inc." Doc. 48 at Ex. 6. Novak did not return to work at Dakota Industries, and filed the instant suit on June 8, 1994.
SUMMARY JUDGMENT
The Court must grant Defendants' motion for summary judgment if there is no genuine issue of material fact for trial and Defendants are entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). "[T]here is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S. Ct. 2505, 2511, 91 L. Ed. 2d 202 (1986). "[T]rial courts should believe the evidence of the party opposing summary judgment and all justifiable inferences should be drawn in that party's favor." Commercial Union Ins. Co. v. Schmidt, 967 F.2d 270, 271 (8th Cir.1992). "Factual disputes that are irrelevant or unnecessary will not be counted." Anderson, 477 U.S. at 247, 106 S.Ct. at 2510. "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Id. at 248, 106 S.Ct. at 2510.
VETERANS REEMPLOYMENT RIGHTS ACT
The Veterans Reemployment Rights Act [VRRA] was originally enacted to permit reinstatement of veterans of regular military service to positions left or positions of "like seniority, status, and pay." 38 U.S.C. § 2021(a). The Act also protected regular veterans from discharge without cause for one year after reinstatement. 38 U.S.C. §§ 2021(b)(1). Reservists are protected by § 2024(d) which requires employers to grant *875 reservist-employees a leave of absence in order to train. Reservists are further protected by § 2021(b)(3) which extends the protections of § 2021(a) to reservists. 38 U.S.C. § 2021(b)(3). As the Supreme Court stated:
The legislative history thus indicates that § 2021(b)(3) was enacted for the significant but limited purpose of protecting the employee-reservist against discriminations like discharge and demotion, motivated solely by reserve status. Congress wished to provide protection to reservists comparable to that already protecting the regular veteran from "discharge without cause" to insure that employers would not penalize or rid themselves of returning reservists after a mere pro forma compliance with § 2024(d).
Monroe v. Standard Oil Co., 452 U.S. 549, 559-60, 101 S. Ct. 2510, 2516-17, 69 L. Ed. 2d 226 (1981).
The motion for summary judgment raises a number of issues. Defendants argue that Novak's failure to return to work or to apply for reinstatement as required by § 2021(a) is a "jurisdictional prerequisite" to the Court hearing a suit brought pursuant to the VRRA. Doc. 37 at 5. This Court is granted jurisdiction over claims brought pursuant to the VRRA by § 2022.[8] The statutory requirement that a veteran "make[] application for reemployment within ninety days after such person is relieved from training and service" is found at § 2021(a). Section 2021(a) applies to regular military personnel. Novak is a reservist and therefore § 2021(b)(3) not § 2021(a) applies here.[9] Section 2021(b)(3) does not require application for reemployment.[10]
In addition, by Defendants' own interpretation, § 2021(a) applies to periods of "extended military leave." Doc. 37 at 4. There are two absences due to military obligations at issue here: Novak's six-month's service in Desert Storm and her January 24, 1992, training in Salt Lake City. There is no dispute that Novak was reinstated after returning from Desert Storm, although she does dispute whether she was reinstated for "like seniority, status, and pay." With regard to the January 24th absence, a one-day training session is, by no stretch of the imagination, an "extended military leave."
Also with regard to the January 24th training session, Defendants argue that § 2024(d) requires an employee-reservist to return or reapply to work. Defendants cite the Court to that portion of § 2024(d) which reads:
Such employee shall report for work at the beginning of the next regularly scheduled working period after expiration of the last calendar day necessary to travel from the place of training to the place of employment following such employee's release, or within a reasonable time thereafter if delayed return is due to factors beyond the employee's control.
Doc. 37 at 4. Defendants' failed to cite the next sentence which reads:
Failure to report for work at such next regularly scheduled working period shall make the employee subject to the conduct rules of the employer pertaining to explanations *876 and discipline with respect to absences from scheduled work.
38 U.S.C. § 2024(d). Failure to report to work after a training session does not deprive the Court of jurisdiction, nor is it required in order to state a claim under the VRRA.[11]
Defendants similarly argue that Novak gave Dakota Industries inadequate notice of the January 24 training session, thereby giving cause for her dismissal. Defendants cite Burkart v. Post-Browning, Inc., in which an employee gave his employer 15 minutes notice of three-week training session. 859 F.2d 1245, 1246 (6th Cir.1988). The undisputed facts are that the January 24th training session was discussed as a possibility on January 16, and Novak presented her orders to Mackintosh at 4:30 P.M. on Wednesday, January 22. I find that the notice is not per se unreasonable. Summary judgment is accordingly denied in that Defendants' have failed to demonstrate any jurisdictional or statutory basis for judgment as a matter of law.
In the alternative, Defendants move to dismiss Donald P. Mackintosh from this suit as an improper party as a matter of law. Doc. 36. Defendants cite Fed.R.Civ.P. 17(a) and argue that South Dakota law applies to determine the real party in interest because Mackintosh is a resident of South Dakota. Defendants then cite several South Dakota cases standing for the proposition that a corporate officer is not liable for contractual obligations of the corporation. Doc. 37 at 6. Plaintiff did not respond on the issue.
The VRRA creates a federal cause of action to which federal, rather than state, law applies. See, i.e., 38 U.S.C. § 4302(b) (Supp.1995).[12] Section 2022 of the VRRA provides, "In any such action only the employer shall be deemed a necessary party respondent." This language has been interpreted as preventing the joinder of third parties rather than limiting the parties sued. As one district court explained in determining that a pension fund was an appropriate defendant in addition to the employer:
However, the fact that the Fund is deemed an unnecessary party to Bunnell's action under § 2022 does not mean that it is an improper or impermissible party to the action. Rather, the "necessary party" language allows the plaintiff the choice of whether to sue anyone other than his immediate employer, such as his union or pension fund. It also deprives the employer of the right to bring in such parties or dismiss the action, although they might otherwise be found to be necessary under Rule 19(a) due to their interest in the result of the suit.
Bunnell v. New England Teamsters & Trucking Indus. Pension Fund, 486 F. Supp. 714, 720 (D.Mass.1980), aff'd, 655 F.2d 451 (1st Cir.1981), cert. denied, 455 U.S. 908, 102 S. Ct. 1253, 71 L. Ed. 2d 446 (1982).
While the VRRA imposes liability upon an "employer," the Act does not define the term. Although there are cases dealing with whether a party defendant is an employer under the Act, they generally deal with de facto employers such as pension funds. See, i.e., Imel v. Laborers Pension Trust Fund for Northern Cal., 904 F.2d 1327 (9th Cir.1990); Bunnell, 486 F.Supp. at 714. This Court must determine whether Mackintosh is an employer, and whether he is liable, if the Court so determines at trial, in both his official and individual capacities.
Two theories of employer liability have evolved in labor law. The first is that, as courts have interpreted Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, and, for the most part, Employee Retirement Income Security Act [ERISA], an employer is not personally liable for violation of those statutes.[13] For *877 example, Title VII suits are properly brought against employers and individuals in their official capacities but not their individual capacities. Sauers v. Salt Lake County, 1 F.3d 1122, 1125 (10th Cir.1993) (citing Busby v. City of Orlando, 931 F.2d 764, 772 (11th Cir.1991)). See Lenhardt v. Basic Institute of Technology, Inc., 55 F.3d 377, 380 (8th Cir.1995), in which the Eighth Circuit, although it has not directly addressed the question of individual liability under Title VII for employee-supervisors, predicted that Missouri would find the reasoning of those courts which have denied individual liability under Title VII persuasive. See also Rockney v. Blohorn, 877 F.2d 637 (8th Cir.1989), in which the Eighth Circuit addressed the issue of personal liability of employers under ERISA, noted the differing purposes of the Fair Labor Standards Act [FLSA] and ERISA, and held that, although FLSA permits suits against employers in their individual capacities, "corporate officers cannot be held personally liable under ERISA where there is no basis for piercing the corporate veil." Id. at 643.
The second line of reasoning in labor law imposes personal liability upon employers. The Fair Labor Standards Act is the primary piece of legislation in that regard. The overwhelming weight of authority is that a corporate officer with operational control of a corporation's covered enterprise is an employer along with the corporation, jointly and severally liable under the FLSA for unpaid wages." Dole v. Elliott Travel & Tours, Inc., 942 F.2d 962, 965 (6th Cir.1991) (quoting Donovan v. Agnew, 712 F.2d 1509, 1511 (1st Cir.1983)).
The Court also looks to the Uniformed Services Employment and Reemployment Rights Act [USERRA] which replaced the VRRA in 1994 for guidance. First, the legislative history of the USERRA indicates that the act was designed to improve, rather than replace the VRRA:
The Veterans' Reemployment Rights (VRR) provisions of Federal law, which safeguard employment and reemployment rights in civilian employment of members of the uniformed services, have been in effect for over fifty years. Although the law has effectively served the interests of veterans, members of the Reserve Components, the Armed Forces and employers, the current statute is complex and sometimes ambiguous, thereby allowing for misinterpretations.... Accordingly, the primary goals of the Committee, in undertaking the revision of chapter 43, were to clarify, simplify, and, where necessary, strengthen the existing veterans' employment and reemployment rights provisions....
Moreover, new section 4303 would define significant terms used throughout the Act in an effort to avoid misinterpretation of those terms....
The provisions of Federal law providing members of the uniformed services with employment and reemployment rights, protection against employment-related discrimination, and the protection of certain other rights and benefits, have been eminently successful for over fifty years. Therefore, the Committee wishes to stress that the extensive body of case law that has evolved over that period, to the extent that it is consistent with the provisions of this Act, remains in full force and effect in interpreting these provisions. This is particularly true of the basic principle established by the Supreme Court that the Act is to be "liberally construed."
H.Rep. No. 103-65, 103d Cong., 2d Sess. 21 (1993), reprinted in 1994 U.S.C.C.A.N. 2449, 2451-52 [hereinafter "House Report"]. Second, although not making the same reference for the term "employer," the legislative history of the USERRA states:
Section 4303(3) would define "employee" in the same expansive manner as under the *878 Fair Labor Standards Act, 29 U.S.C. 203(e)....
House Report at 2454. Third, the USERRA broadly defines "employer":
[T]he term "employer" means any person, institution, organization, or other entity that pays salary or wages for work performed or that has control over employment opportunities[.]
38 U.S.C. § 4304(4) (Supp.1995). Fourth, the definition of "employer" found in the Uniformed Services Employment and Reemployment Rights Act is closer to the definition of employer found in the Fair Labor Standards Act than that in Title VII of the Civil Rights Act of 1964.[14] Therefore, the Court finds that the Veterans Reemployment Rights Act, like the Fair Labor Standards Act, imposes joint and several liability upon employers as both individuals and entities.
Defendant Mackintosh testified in his deposition that he is the President of Dakota Industries as well as a member of the Board of Directors. Mackintosh at 9, 13-14. Novak reported directly to Mackintosh. Id. at 117-18. The Court finds that Mackintosh qualifies as an "employer" under the VRRA. Summary judgment is therefore denied with respect to Defendant Mackintosh being an appropriate party in this matter.
Although this case falls under the VRRA because reemployment was initiated prior to October, 1994, see supra n. 1, the standard of proof under the VRRA is continued under the USERRA. Section 4311(b) of the USERRA provides:
An employer shall be considered to have denied a person initial employment, reemployment, retention in employment, promotion, or a benefit of employment in violation of this section if the person's membership, ... service, ... or obligation for service in the uniformed services is a motivating factor in the employer's action, unless the employer can prove that the action would have been taken in the absence of such membership, ... performance of service ... or obligation.
38 U.S.C. § 4311(b) (Supp.1995). As the legislative history to § 4311(b) indicates:
This standard and burden of proof is applicable to all causes brought under this section regardless of the date of accrual of the cause of action. To the extent that courts have relied on dicta from the Supreme Court's decision in Monroe v. Standard Oil Co., 452 U.S. 549, 559 [101 S. Ct. 2510, 2516, 69 L. Ed. 2d 226] (1981), that a violation of this section can occur only if the military obligation is the sole factor see Sawyer v. Swift & Co., 836 F.2d 1257, 1261 (10th Cir.1988), those decisions have misinterpreted the original legislative intent and history of 38 U.S.C. 2021(b)(3) and are rejected on that basis.
House Report at 2457.
Accordingly, this VRRA claim requires the same type of analysis as employment discrimination or retaliatory discharge claims under Title VII. In those claims, the Eighth Circuit applies the three-part, "burden shifting" analysis set out in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S. Ct. 1817, 1824, 36 L. Ed. 2d 668 (1973).
First, the plaintiff must make a prima facie case by "showing participation in a protected activity, a subsequent adverse action by the employer, and some evidence of a causal connection between the protected activity ... and the subsequent adverse action." Second, once the plaintiff has established a prima facie case, the burden shifts to the employer to articulate an appropriate nondiscriminatory reason for its action. Finally, if the employer satisfies this burden, the plaintiff must then demonstrate that the proffered reason is pretextual.
Reich v. Hoy Shoe Co., Inc., 32 F.3d 361, 365 (8th Cir.1994) (citing Schweiss v. Chrysler *879 Motors Corp., 987 F.2d 548, 549 (8th Cir. 1993)). "However, the plaintiff is not required to show that the employer's proffered reasons were false or played no role in the employment decision, but only that they were not the only reasons and that the prohibited factor was at least one of the `motivating' factors." Cronin v. Aetna Life Ins. Co., 46 F.3d 196, 203 (2d Cir.1995) (citing Price Waterhouse v. Hopkins, 490 U.S. 228, 247, 109 S. Ct. 1775, 1788, 104 L. Ed. 2d 268 (1989) (plurality opinion)). See Hutson v. McDonnell Douglas Corp., 63 F.3d 771, 780 (8th Cir. 1995) (holding the Price Waterhouse mixedmotives analysis did not apply in Title VII case where plaintiff had not made a preliminary showing of discrimination or established a causal relationship between discriminatory "attitude" and adverse employment actions). See also Hansen v. Town of Irondequoit, 896 F. Supp. 110, 113 (W.D.N.Y.1995) (setting out "burden shifting" analysis as it applies to the VRRA).
In this case, Novak has demonstrated that she was a member of the Army Reserves, that she was dismissed from her employment, and that her employer threatened to fire her if she was not at work on January 24, the day she was to train in Salt Lake City. Defendants alleged facts claiming that Novak was fired for cause, including job abandonment and insubordination. Mackintosh at Ex. 9. "[T]he conflict between the plaintiff's evidence establishing a prima facie case and the employer's evidence of a nondiscriminatory reason reflects a question of fact to be resolved by the factfinder after trial." Cronin, 46 F.3d at 203; Davis v. Fleming Companies, Inc., 55 F.3d 1369, 1371 (8th Cir.1995) (recognizing the sparing use of summary judgment to determine discriminatory or retaliatory intent in employment cases). Accordingly,
IT IS ORDERED:
(1) That Plaintiff's Motion to File Supplemental Brief, Doc. 52, is granted and the brief has been considered by the Court in its analysis of the Motion for Summary Judgment,
(2) That Defendants' Motion for Summary Judgment is denied in all respects.
NOTES
[1] The complaint in this action references the Veterans Reemployment Rights Act [VRRA], codified at 38 U.S.C. §§ 2021-27, as amended. The VRRA was renumbered Chapter 43, sections 4301-07 by Pub.L. 102-568, Title V, § 506(a), Oct. 29, 1992, 106 Stat. 4340. Section 2021 was transferred without change to § 4301. The VRRA was subsequently amended by the Uniformed Services Employment and Reemployment Rights Act [USERRA], codified at 38 U.S.C. §§ 4301-33, effective October 13, 1994. The USERRA generally applies to reemployments initiated on or after a 60-day period after enactment of the Act, October 13, 1994. Pub.L. 103-353, § 8, Oct. 13, 1994, 108 Stat. 3150. "Reemployment" in this matter was initiated in 1991 when Plaintiff returned from Desert Storm, and in 1992 when Plaintiff attended a training session in Salt Lake City. Therefore, the renumbered VRRA applies. To minimize confusion with the USERRA, the Court will use the former numbers in its discussion.
[2] Section 2022 of the VRRA provides, in pertinent part:
Upon application to the United States attorney or comparable official for any district in which such private employer maintains a place of business ... by any person claiming to be entitled to the benefits provided for in such provision, such United States attorney or official, if reasonably satisfied that the person so applying is entitled to such benefits, shall appear and act as attorney for such person in the amicable adjustment of the claim or in the filing or any motion, petition, or other appropriate pleading and the prosecution thereof specifically to require such employer to comply with such provisions.
38 U.S.C. § 2022 (1991).
[3] There is a dispute regarding Novak's pay at the time she left for Desert Storm due to Dakota Industries inability to produce the original of a "Change of Status" form which indicates a change from "Office & Personnel Manager" to "General Manager" on October 12, 1990, with a corresponding increase in salary from $6.50/ hour to $7.00/hour. See Mackintosh at 31-48 and Ex. 7 & 7A. Mackintosh contends that, if the Change of Status document is genuine, the position of "General Manager" was only anticipatory, and that Novak could not have been rehired as General Manager upon her return from Desert Storm because the position never existed. Mackintosh at 40-41. Mackintosh did testify that Novak's duties were reduced upon her return from Desert Storm. Id. at 48. As this is a motion for summary judgment, all inferences are drawn in favor of the non-moving party, here the plaintiff, and her submission to the Court of a copy of her Change of Status form establishes a prima facie case for Dakota Industries' failure to reinstate Novak "to a position of like seniority, status, and pay[.]" 38 U.S.C. §§ 2021(b)(3) and 2021(a)(A). See Hansen v. Town of Irondequoit, 896 F. Supp. 110, 113 (W.D.N.Y.1995) (setting out "burden shifting" analysis as it applies to the VRRA).
[4] Order 123-04, dated November 17, 1990, ordered the 323d Chemical Company to 180 days active duty beginning on November 21, 1990. Order 035-0S4, dated November 21, 1990, ordered Novak to annual training for two days plus allowable travel time, beginning on November 19, 1990.
[5] It is undisputed that Novak attended and represented Dakota Industries at a trade show in Denver in January of 1992 and returned without her false teeth. Doc. 48 at 4-5; Mackintosh at 97. Apparently, Novak became flushed her false teeth down the toilet, thereby necessitating their replacement and the dental appointment on January 23, 1992. Doc. 49 at ¶ 15.
[6] The following exchange occurred between the Assistant U.S. Attorney and Mackintosh:
Q: How did you make the decision to terminate Ms. Novak?
A: I didn't. Ms. Novak happily made it for us.
Q: And how did she do that?
A: Well, again, it was a direct insubordination. She puked up her teeth, her false teeth, and she had elected to take a Thursday dental appointment. She sprung this on me practically right up on the date that it was due, and I said, no, you cannot take a another workday off. You're going to be here Thursday. Now, at no time did I ever say, you're fired, Rita. I didn't have to. Rita did it for us.
At 4:30 on Wednesday, having seen her orders that she was to report for guard duty or reserve duty on Friday, 8:00 o'clock Friday morning, at 4:30 on Wednesday she walked out. And I said, are you going to and it was somewhat of a rhetorical question are you going to go obey these orders, I think is what I asked. She said, yes. I said, then give me your keys. That is the full extent of the last time I ever saw Rita as far as the company was concerned.
Q: You didn't consider you were terminating her at that time?
A: No. No. Why there was nothing said about terminating her. What was said is that she could not take Thursday off. I picked up her keys in anticipation of her being gone, period. I had done this I think five or six times before. When she went to summer camp in 1989, we picked her keys up.
Mackintosh at 97-98.
[7] The deposition testimony of Mr. Mackintosh includes the following:
Q: Do you recall telling Ms. Novak's commanding officer on January 22nd, 1992 that if she didn't show up on January 24th, she would be out of a job?
A: I recall exploring that with everybody I talked to.
Q: I'm asking you whether you recall telling the commanding officer that?
A: No, I don't recall specifically. It would not be out of line for why I was calling people. Mackintosh at 97.
[8] Section 2022 of the VRRA states, in part:
If any employer ... fails or refuses to comply with the provisions of section 2021(a), (b)(1), or (b)(3), or 2024 of this title, the district court of the United States for any district in which such private employer maintains a place of business ... shall have the power, upon the filing of a motion, petition, or other appropriate pleading by the person entitled to the benefits of such provisions, specifically to require such employer to comply with such provisions and to compensate such person for any loss of wages or benefits suffered by reason of such employer's unlawful action.
38 U.S.C. § 2022 (1991).
[9] Section 2021(b)(3) of the VRRA reads:
Any person who seeks or holds a position described in clause (A) or (B) of subsection (a) of this section shall not be denied hiring, retention in employment, or any promotion or other incident or advantage of employment because of any obligation as a member of a Reserve component of the Armed Forces.
38 U.S.C. § 2021(b)(3) (1991).
[10] The USERRA requires that an employee returning from military training or service notify his or her employer of their intent to return to a position of employment within certain time periods, depending upon the length of the absence, in order to receive protection under the Act. 38 U.S.C. §§ 4312(e)(1) & 4312(h) (Supp.1995).
[11] See supra.
[12] Section 4302(b) of the USERRA provides:
This chapter supersedes any State law (including any local law or ordinance), contract, agreement, policy, plan, practice, or other matter that reduces, limits, or eliminates in any manner any right or benefit provided by this chapter, including the establishment of additional prerequisites to the exercise of any such right or the receipt of any such benefit.
38 U.S.C. § 4302(b) (Supp.1995).
[13] The Court notes that one district court looked to areas of labor law such as ERISA, 29 U.S.C. § 1001 et seq.; Title VII, 42 U.S.C. § 2000e et seq.; and the National Labor Relations Act, 29 U.S.C. § 151 et seq., for guidance in defining "employer." Bunnell v. New England Teamsters & Trucking Indus. Pension Fund, 486 F. Supp. 714, 721 (D.Mass.1980), aff'd, 655 F.2d 451 (1st Cir.1981), cert. denied, 455 U.S. 908, 102 S. Ct. 1253, 71 L. Ed. 2d 446 (1982). In Bunnell, however, the court was deciding whether a pension fund was an employer for purposes of VRRA. I find the case of little help on the official versus individual liability issue.
[14] The FLSA states:
"Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee....
29 U.S.C. § 203(d) (1978). In contrast, Title VII of the 1964 Civil Rights Act defines "employer" as:
[A] person engaged in an industry affecting commerce who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding year, and any agent of such a person....
42 U.S.C. § 2000e(b) (1994). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581154/ | 919 F. Supp. 472 (1996)
TOTAL TELECOMMUNICATIONS SERVICES, INC., and Atlas Telephone Company, Inc., Plaintiffs,
v.
AMERICAN TELEPHONE AND TELEGRAPH CO., Defendant.
Civ. A. No. 95-2273.
United States District Court, District of Columbia.
March 5, 1996.
*473 *474 David R. Kuney, David, Hagner, Kuney & Krupin, P.C., Washington, DC, for plaintiff.
Peter D. Keisler, James F. Bendernagel, David L. Lawson, Washington, D.C., for defendant.
*475 Memorandum Opinion
URBINA, District Judge.
Granting Defendant's Motion to Refer this Case to the Federal Communications Commission;[1] Denying Plaintiffs' Motion for a Preliminary Injunction; and Denying Plaintiffs' Application for a Temporary Restraining Order[2]
This matter comes before the court upon defendant's motion to refer this case to the Federal Communications Commission (FCC); plaintiffs' motion for a preliminary injunction; and plaintiffs' application for a temporary restraining order. After considering the submissions, the court concludes that referral to the FCC is appropriate pursuant to the doctrine of primary jurisdiction. Furthermore, so as not to encroach upon FCC's primary jurisdiction by expressing a view as to the underlying merits of the present action, the court will not entertain plaintiffs' request for injunctive relief. Finally, the court concludes that holding this action in abeyance pending agency resolution of the underlying issues is rendered inappropriate by the circumstances of the case.
I. Background
TTS asserts that it is a competitive access provider located in Big Cabin, Oklahoma.[3] It provides local terminating services, the last link in a long-distance telephone call, to common carriers of interstate communications, such as AT & T. Long-distance carriers do not provide originating or terminating services and are thus dependent upon local telephone companies for those services. TTS provides only interstate services for the termination of calls placed by subscribers of AT & T to an end user served by TTS. TTS does not provide local telephone service to its customers. TTS's sole end user at this point is Audiobridge.[4]
Between August 1, 1995 and November 21, 1995, TTS provided terminating services but no originating services to AT & T. TTS provides its services pursuant to the rates, terms, and conditions of its tariff filed with the FCC on July 31, 1995. The tariff took effect on August 1, 1995. Pursuant to this tariff, TTS seeks to charge long-distance carriers with access fees for providing its terminating services. TTS leased access service from Atlas Telephone Company (Atlas), the other plaintiff in this case.[5] Under the arrangement, Atlas and TTS jointly provide the access service ordered by AT & T and each bills AT & T for its services.
Atlas is a local telephone exchange monopoly located in Big Cabin, Oklahoma, where it owns and controls the telephone lines of service users in that location. Atlas provides originating services, the first step in the communications chain of a long-distance call placed by one of the users served by Atlas. Atlas also provides terminating services to its customers when they receive a long-distance *476 telephone call. Since Atlas is the local monopoly, its rates are regulated. Long-distance carriers purchase access to Atlas's originating and terminating services. AT & T has purchased and continues to purchase access service from Atlas.
AT & T admits that it completed many long-distance telephone calls to TTS's end user. As a consequence of the increased traffic resulting from TTS's operations, AT & T requested that Atlas provide additional carrying capacity into Big Cabin. TTS argues that such a request was in effect an order of TTS's services. AT & T disputes this conclusion. TTS further asserts that under its tariff and standard industry practice, it has the authority and the right to charge AT & T as a result of Atlas' extension of access service to TTS. Thus, TTS contends that AT & T is automatically liable to TTS for its services upon TTS notifying AT & T of the change in the billing arrangement between AT & T and Atlas. TTS states that it notified AT & T of the changed billing arrangement by letter dated August 4, 1995. From August to November 1995, TTS billed AT & T approximately $800,000 for such services. TTS argues that AT & T is bound to honor TTS's tariff and that AT & T must provide long distance service to telephone numbers served by TTS.
TTS and Atlas have a highly intertwined relationship. Plaintiffs do not dispute the fact that the president of the latter is also the chairman of the former. TTS has obtained some of the facilities of Atlas to provide terminating services. Although TTS terms itself a competitive access provider, it does not specify how it competes with Atlas. The charges AT & T must pay TTS are in addition to those that the long-distance carrier must pay to Atlas for terminating services for the same telephone calls. Thus, according to AT & T, this arrangement has multiplied by a factor of ten the access charges that must be paid by the long-distance carriers. In effect, AT & T's position is that if the current operating structure of Atlas and TTS is allowed to persist, long-distance carriers will be forced to pay duplicative access charges. The result would be, AT & T contends, that it would end up losing money on many telephone calls.
AT & T maintains that the arrangement entered into by TTS and Atlas violates two sets of FCC regulations. First, AT & T contends that TTS is in reality operating a "chat line," that is a pay-per-call 900 number service, which must conform to detailed FCC regulations. By devising the present operating structure, AT & T argues, plaintiffs are attempting to evade these regulations by providing a pay-per-call type of service but shifting the cost from the customer to the long-distance carriers. This is so because the customer pays the normal long-distance rates and the plaintiffs extract the profits via the duplicative access fees charged to the long-distance carriers.
Second, AT & T takes issue with the creation of TTS as a second company and the latter's claims to be a competitive access provider. According to AT & T, plaintiffs have consummated this arrangement in order to avoid the rate regulations that are applicable to Atlas as a dominant carrier. These regulations include one that requires dominant carriers to charge cost-based rates and to file tariffs specifying their rates at least forty-five days before they take effect. This requirement is imposed by the FCC so that it may investigate and if necessary suspend or reject those rates if they are unreasonably high or otherwise are not legal. 47 C.F.R. § 61.58(c)(1). Competitive access providers, which lack the market dominance of a dominant carrier, are permitted to file tariffs on one-day's notice and the tariffs are presumed lawful by the FCC.
AT & T therefore asserts and plaintiffs agree that the current dispute presents issues that are of significant importance to carriers, their customers, and the telephone industry in general.[6] This is the case because access charges are the single biggest cost associated with the provision of long-distance service. Moreover, AT & T asserts and plaintiffs do not dispute, that arrangements *477 such as the one between Atlas and TTS are beginning to appear around the country and TTS's president has indicated TTS's intention to replicate the arrangement elsewhere.
On November 22, 1995, as a consequence of its concerns, AT & T terminated its interconnection services with TTS. However, AT & T states that it continues to provide long-distance service to Big Cabin residents, not through TTS's facilities but through those of Atlas. On November 24, 1995, as a result of AT & T's termination of interconnection services, TTS moved for a temporary restraining order in the United States District Court for the Northern District of Oklahoma, seeking to have "AT & T restrained from blocking telephone calls destined for telephone numbers allegedly assigned and served by TTS which terminate at facilities operated by TTS." Order, Total Telecommunications Services, Inc. v. AT & T 1 (N.D.Okla. Dec. 1, 1995). The court there found that the main disputed issue pertained to the "meaning, scope, applicability, and validity of TTS's tariff as it relates to TTS's billing practices." Id. at 4. The court concluded that the power and duty to examine all tariffs rests with the FCC. The court thus denied TTS' application for a temporary restraining order and referred the matter to the FCC for a determination of all the issues within its jurisdiction. The court further stayed the action pending the FCC's final determination. TTS then voluntarily dismissed the action it had instituted in Oklahoma and has now filed the current action, presenting substantially the same issues, in this jurisdiction.
II. Doctrine of Primary Jurisdiction
Plaintiffs have presently moved for a preliminary injunction, seeking this court to order AT & T to provide long distance service to TTS's customers. Plaintiffs also seek to have the court order AT & T to pay for past and future services.[7] TTS contends that AT & T's refusal to furnish service violates Sections 201(a); 202, and 214 of the Communications Act of 1934, 47 U.S.C. § 151 et seq. and Section 251 of the 1996 Act (Communications Act).[8]
The issues to be resolved in this case involve questions relating to: (1) whether AT & T must interconnect its services to those of TTS; (2) the validity of TTS's tariff and practices; (3) whether AT & T discontinued service in violation of Section 214; (4) whether AT & T engaged in discriminatory conduct and whether TTS is properly categorized as a competitive access provider. There are also underlying policy issues implicated by plaintiffs' operating structure in this case.
*478 The resolution of these issues involve policy considerations concerning the public interest and technical questions relating to TTS's tariff and operating structure, that the Communications Act has vested the FCC with the mandate to determine. The FCC has broad authority to evaluate both prices and terms of proposed rates, it can investigate existing ones, and if necessary, prescribe alternatives. Its supervisory powers extend to a carrier's "charges, practices, classifications, and regulations." 47 U.S.C. § 201(b). The term "carriers" includes both long-distance companies and local exchange monopolies, such as Atlas. 47 U.S.C. § 153(h). Moreover, the FCC may control which carriers compete, where, and under what corporate structures. The powers granted to the FCC are a reflection of Congress' intention that one governmental entity be vested with the responsibility of developing, coordinating and enforcing a uniform telecommunications policy. See Chastain v. AT & T, 351 F. Supp. 1320, 1322 (D.D.C. 1972).
As a result of the Commission's mandate and pursuant to the primary jurisdiction doctrine, the FCC is the entity best suited to make the initial determination of the issues presently before the court. "Primary jurisdiction is invoked in situations where the courts have jurisdiction over the claim from the very outset, but it is likely that the case will require resolution of issues, which, under a regulatory scheme, have been placed in the hands of an administrative body." Marshall v. El Paso Natural Gas Co., 874 F.2d 1373, 1376 (10th Cir.1989). The primary jurisdiction doctrine is premised on a desire for uniform outcomes and on the inherent advantage in allowing an agency, in this case the FCC, to apply its expert judgment to the issues in dispute. See Texas & Pacific Ry. v. Abilene Cotton Oil Co., 204 U.S. 426, 441, 27 S. Ct. 350, 355-356, 51 L. Ed. 553 (1907); United States v. Western Pacific, R.R., 352 U.S. 59, 64, 77 S. Ct. 161, 165, 1 L. Ed. 2d 126 (1956); Nader v. Allegheny Airlines, Inc., 426 U.S. 290, 303-304, 96 S. Ct. 1978, 1986-1987, 48 L. Ed. 2d 643 (1976); Allnet Communication Service v. NECA, 965 F.2d 1118, 1120 (D.C.Cir.1992).
The agency's expertise is not limited to technical matters, but extends to the agency's mandate to implement, in this case the Telecommunications Acts of 1934 and 1996, and the concomitant policy judgments it must make. Western Pacific, R.R., 352 U.S. at 65, 77 S.Ct. at 165-166. Were the district courts to make the initial determinations of the issues involved in this case, one of the premises of primary jurisdiction could be infringed. That is, different courts may resolve the regulatory issues before them in an inconsistent manner thereby producing disparate results. "The doctrine of primary jurisdiction has been developed by the courts in order to avoid conflict between the courts and an administrative agency arising from either the court's lack of expertise with the subject matter of the agency's regulation or from contradictory rulings by the agency and the court." MCI Communications Corp. v. AT & T, 496 F.2d 214, 220 (3d Cir.1974).
Courts may consider additional relevant factors when evaluating the appropriateness of invoking the primary jurisdiction doctrine. For example, "whether the issues of fact raised in the case are not within the conventional experience of judges, or whether the issues of fact require the exercise of administrative discretion; or require information and consistency in the regulation of the business entrusted to a particular agency." Marshall, 874 F.2d at 1377 (internal citations omitted). Furthermore, the primary jurisdiction doctrine may be applicable even if the questions raised in a case are within the ordinary experience of the judiciary. MCI Communications Corp. 496 F.2d at 223; see also AT & T v. MCI Communications Corp., 837 F. Supp. 13, 16 (D.D.C.1993) (identifying four factors: (1) whether the question at issue is within the conventional experience of judges; (2) whether the question at issue lies peculiarly within the agency's discretion or requires the exercise of agency expertise; (3) whether there exists a danger of inconsistent rulings; and (4) whether a prior application to the agency has been made).
Importantly, the plaintiffs do not deny the fact, brought forward by AT & T, that many of the issues presently pending before the *479 court are already before the FCC. Specifically, in MCI Telecommunications Corp. v. Beehive Tel. Co., FCC no. E-95-44, the FCC is evaluating the validity of the tariff of the Beehive Telephone Company; the tariff after which TTS's tariff was modeled. Furthermore, in the Oklahoma proceedings, counsel for plaintiff recognized that the underlying dispute had to ultimately be resolved by the FCC. Moreover, plaintiffs do not dispute the fact that they have standing to present all their claims before the FCC and thereby obtain whatever relief they are entitled to. See Western Union Tel. Co. v. Graphic Scanning Corp., 360 F. Supp. 593, 596 (S.D.N.Y. 1973). Additionally, the court notes that Sprint is also refusing to provide interconnection services to TTS. It is apparent that long-distance carriers are concerned about the operating structure of entities like TTS. Referral would therefore be appropriate in this case. See Mical Communications, Inc. v. Sprint Telemedia, Inc., 1 F.3d 1031, 1038-1040 (10th Cir.1993).
In addition, on January 23, 1996, TTS filed a petition before the FCC in which it lodged the same allegations against AT & T as in the present lawsuit. In that petition, TTS seeks to have the FCC reconsider its decision to classify AT & T as a non-dominant carrier. In that proceeding, TTS alleges that, "AT & T unlawfully blocked TTS's calls from being completed to TTS's end users. Furthermore, AT & T took this action in violation of Section 214(a) of the Communications Act ..." Total Telecommunications Services, Inc., Petition for Reconsideration, CCB Pol 95-25. In evaluating the merits of TTS's petition, the FCC will have to consider the lawfulness of AT & T's actions; the same exercise plaintiffs request the court to presently pursue.
A. Interconnection of Services
The central claim in this case, as the court views it, is whether TTS has the right and AT & T the concomitant obligation, to interconnect its services to those of TTS.[9] The Communications Act does provide that such interconnections can be ordered, but only by the FCC. 47 U.S.C. § 201(a). Thus the question becomes whether AT & T must interconnect its services with those of TTS upon the latter's request. Such a question should be addressed by the FCC. See, e.g., MCI Telecommunications Corp., 496 F.2d at 219-223. The plain language of Section 201(a) clearly suggests that interconnection is required only when the FCC so directs it; and courts have so interpreted Section 201(a). See e.g., So. Pac. Comm. Co. v. AT & T, 556 F. Supp. 825, 975 (D.D.C.1983), aff'd, 740 F.2d 980 (D.C.Cir.1984), cert. denied, 470 U.S. 1005, 105 S. Ct. 1359, 84 L. Ed. 2d 380 (1985); Woodlands Tel. Corp. v. AT & T, 447 F. Supp. 1261, 1265 (S.D.Tex.1978). In So. Pac. Comm. Co., the court stated that "a carrier has no duty under the Communications Act to provide interconnection to another carrier." Id. at 975.[10] Moreover, before such an order is issued, the FCC must first *480 make a finding, after a hearing, that such a result would be in the public interest. Id.
B. Validity of Tariffs
Section 201(b) declares unlawful any tariffs, rates, charges, or other practices that are "unjust or unreasonable." The FCC has primary jurisdiction over claims that tariffs and/or practices are not just or reasonable. Ambassador, Inc. v. United States, 325 U.S. 317, 324, 65 S. Ct. 1151, 1155, 89 L. Ed. 1637 (1945); Chastain v. AT & T, 351 F. Supp. 1320 (D.D.C.1972). "Given the concern for uniformity and expert judgment, it is hardly surprising that courts have frequently invoked primary jurisdiction in cases involving tariff interpretations ... [and] compliance of a tariff with regulatory standards ..." Allnet Communication Service, 965 F.2d at 1120. Questions involving standard industry practices should also be entertained by the FCC. See Ricci v. Chicago Mercantile Exch., 409 U.S. 289, 305, 93 S. Ct. 573, 582, 34 L. Ed. 2d 525 (1973) (internal citations omitted).
Technical questions, as the Oklahoma court found, involving the adequacy and validity of TTS's filed tariff fall more properly within province of the FCC. Plaintiffs themselves emphasize that the focus of this litigation should be the interpretation of a tariff; albeit the one used by Atlas. The Communications Act provides that the FCC has the primary responsibility to review, interpret, and when necessary, suspend or reject tariffs that are unjust or unreasonable. It also has the authority to direct carriers to cease such practices or charges and can direct such carriers to rectify their practices and modify their charges to achieve regulatory compliance. 47 U.S.C. §§ 204, 205. TTS's assertion that its tariff is presumed valid is inconsequential. The FCC has declared that "[i]t is well settled that a tariff's becoming effective without investigation does not imply that the tariff is ultimately lawful, or that the tariffed rates were properly targeted." Communications Satellite Corporation, 3 FCC Rcd 2643, 2647 (1988).
Plaintiffs rely heavily on National Comm. Ass'n v. American Tele. and Tele., 46 F.3d 220 (2d Cir.1995), in urging the court to deny AT & T's request for referral. In National Comm. Ass'n, the court declined to apply the doctrine of primary jurisdiction. However, there are important differences between that case and the present one. As the court there recognized, the issue involved was a narrow one: whether the plaintiff in that case had timely paid its bills. Id. at 223. The court, however, recognized that the "statutory reasonableness of a tariff should, of course, be reviewed by an agency." Id. Furthermore, National Comm. Ass'n did not involve the interpretation of a tariff or the reasonableness of the same. Perhaps more importantly, was the fact that in that case the court recognized that there was no risk of inconsistent results, a danger in the present dispute, since a controversy similar to the current one is pending before the FCC.
C. Discontinuation of Service
Plaintiffs claim that AT & T violated Section 214 of the Communications Act in that AT & T did not obtain authorization from the FCC prior to discontinuing service to TTS. The discontinuance requirement incorporated into Section 214 is directed "at preventing a loss or impairment of a service offered to a community or part of a community without adequate public interest safeguards." Memorandum Opinion and Order, Western Union Telegraph Co. Petition for Order to Require the Bell Sys. to Continue to Provide Group/Supergroup Facilities, 74 F.C.C.2d 293, 295 (1979). The FCC has found that carrier-to-carrier interconnection relationships fall within the ambit of Section 214. However, in discontinuance disputes between carriers, the FCC places primary focus on the community served, i.e., the using public or more simply put, the customers, rather than "any technical or financial impact on the carrier itself." Id. at 296. "Such technical or financial considerations are more appropriately considered in a proceeding involving Section 201(a), over which the FCC has primary jurisdiction." Id.;[11]see also *481 ITT World Communications v. New York Tel., 381 F. Supp. 113 (S.D.N.Y.1974); Southwestern Bell Telephone, 8 FCC Rcd. 2589 (1993).
In addition, plaintiffs concede that it is the FCC which interprets the concept of "community". And there is a question as to whether customers in Big Cabin, Oklahoma, are not being provided with long-distance service by AT & T since plaintiffs do not controvert the fact that Big Cabin residents have access to long-distance services from multiple long-distance carriers. Consequently, in reality there is only one end user served by TTS that is currently being affected, Audiobridge. Accordingly, TTS would have to prove that the FCC regards this entity or the customers serviced by it as constituting a community or part thereof.
Even if the court were to frame the current dispute as an alleged unlawful discontinuation of service on the part of AT & T, as opposed to a dispute concerning the right of TTS to be interconnected to AT & T's services, referral to the FCC would nevertheless be appropriate.[12] The resolution of whether a carrier first needs to procure a certificate from the FCC under Section 214 prior to the termination of service, is a matter that should be resolved by the FCC itself, in part, since it is the agency from which the permit must be obtained. This is so, because in certain situations prior authorization for the discontinuation of service to a customer is not required. See e.g., Memorandum Opinion and Order, Pacific Telatronics, Inc. & Revisions to Tariff F.C.C. No. 4, 74 F.C.C.2d 286, 290 (1979). It is unclear whether a Section 214 application is even required in this case because a certificate is not needed when "the adequacy or quality of service" is not impaired. 47 U.S.C. § 214(a). As referenced above, plaintiffs do not dispute the fact that customers continue to have access to their services via other long-distance carriers.[13] As a result, the FCC is the entity that should determine whether in fact there has been a violation of Section 214 in this case, since that section provides for the issuance of an injunction only upon a finding that there has been a discontinuance of service "contrary to the provisions of" Section 214.
Finally, in this action there are more important issues implicated than resolving the question of whether a rule, in this instance Section 214, was violated. See Western Union Tel. Co. v. Graphic Scanning Corp., 360 F. Supp. 593, 596 (S.D.N.Y.1973) (dismissing plaintiff's Section 214 claim; denying injunctive relief request and referring claim to the FCC because plaintiff could obtain full relief by filing his complaint with the FCC). This case implicates policy questions regarding the relationship of putative competitive access providers, in this case, TTS and local exchange monopolies, such as Atlas. Inherent is these questions is the issue of whether TTS is in fact a competitive access provider and whether its tariff is valid. The FCC is better equipped to render a decision on these issues and thereby promote uniformity in the telephone industry.[14]
D. Plaintiffs' Other Claims
Plaintiffs' contention of discrimination on the part of AT & T made pursuant to Section 202 is also more properly the province of the FCC since it is within the FCC's sole discretion *482 to either prescribe a remedy or to order that the carrier end the discrimination. National Ass. of Motor Bus Owners v. FCC, 460 F.2d 561 (2d Cir.1972); see also Vortex Communications, Inc. v. AT & T, 828 F. Supp. 19 (S.D.N.Y.1993). Additionally, plaintiffs' allegation, recently brought forth in their application for a temporary restraining order, that AT & T is violating Section 251 of the new Communications Act, should also be entertained by the FCC. That section states that carriers have a duty to interconnect with other carriers. The duty, however, is dependent upon a finding that TTS is a carrier. The court is disinclined to interpret the rights and duties of carriers and other parties under this section because inconsistent and disparate results might ensue. More importantly, however, is the fact that the new Act charges the FCC with the mandate to "complete all actions necessary to establish regulations to implement the requirements of this section." 47 U.S.C. § 251(d). The court therefore declines to interpret Section 251 in the first instance.
E. Additional Public Policy Considerations
Inherent in the resolution of the issues before the court and perhaps outcome determinative is the determination of whether the operating structure such as the one being employed by the plaintiffs should be allowed to persist. Atlas is the local monopoly in Big Cabin, Oklahoma. As a monopoly it is subject to rigorous regulations. The president of Atlas apparently is also the chairman of TTS. As a result, TTS and Atlas have common officers and operating equipment. TTS holds itself out to be a competitive access provider; if it is indeed such an entity, it is subject to less stringent regulatory standards. Plaintiffs' operating arrangement thus raises important questions regarding the ability of symbiotic companies to enter into an arrangement by which they simultaneous hold themselves out to be the local monopoly and a competitive access provider. The latter is to be a competitor of the former. Without opining on these issues, the court does conclude that this subject is one that should first be entertained by the FCC.
F. The Concern for Delay
Plaintiffs' reliance on various cases for the proposition that the doctrine of primary jurisdiction should rarely be invoked is misplaced under the circumstances of this case. The rationale for invoking the doctrine only in certain circumstances is the potential for delay and expense when the doctrine is applied. United States v. McDonnell Douglas Corp., 751 F.2d 220, 224 (8th Cir.1984) (internal citations omitted). Thus "[w]hen reaching a decision to defer [to an agency], a court must consider how long an administrative process will run before its work is done." Rohr Industries v. WMATA, 720 F.2d 1319, 1326 (D.C.Cir.1983). When the duration of the administrative process is short, the case for deferring to the agency is great. Id. In Rohr Industries, the court was concerned with the potential for delay because in that case the administrative process threatened to drag on for many years. Similarly, in Red Lake Band of Chippewa Indians v. Barlow, 846 F.2d 474 (8th Cir.1988), the court noted that the application of the doctrine could result in the protraction of the litigation. Nevertheless, although the litigation in that case had been on-going for more than six years, the court thought it proper to apply the doctrine. Finally, in National Comm. Ass'n, 46 F.3d 220 (2d Cir.1995), the parties estimated that the delay resulting from referral to the FCC would be from two to five years. In this case, the FCC would be required by statute to issue a final decision within a year of the filing of a complaint; or in exceptional cases, within fifteen months. 47 U.S.C. §§ 208(b)(2), 201(b).
The present litigation has been on-going for only several months. Moreover, plaintiff recognized in the proceedings before the Oklahoma court that the FCC had to resolve the underlying merits of the current dispute. However, it nevertheless decided to voluntarily dismiss the action in Oklahoma and institute a fundamentally similar one in this jurisdiction. Consequently, plaintiff has contributed to the delay and expense associated with the resolution of this controversy that it is seeking to prevent.[15]
*483 III. Plaintiffs' Request for Injunctive Relief[16]
Having concluded that the invocation of the doctrine of primary jurisdiction is appropriate; the court further concludes that it shall not entertain plaintiffs' request for injunctive relief. The court so concludes because to engage in an analysis of whether injunctive relief should issue in this case, would require the court to analyze the underlying merits of the case, thereby encroaching into the FCC's primary jurisdiction. "This is precisely what the doctrine of primary jurisdiction is designed to avoid." Atchison, T. & S.F. Ry. v. Wichita Bd. of Trade, 412 U.S. 800, 821, 93 S. Ct. 2367, 2382, 37 L. Ed. 2d 350 (1973); see also MCI Communications Corp. v. AT & T, 496 F.2d 214 (3d Cir.1974); Mical Communications, Inc. v. Sprint Telemedia, Inc., 1 F.3d 1031 (10th Cir.1993). The issuance of an injunction pending further agency action may indicate the court's opinion on the viability and legal validity of plaintiffs' claims a result that should be avoided.
Moreover, plaintiffs do not dispute the fact that they are free to seek injunctive relief from the FCC. Section 4(i) of the Communications Act, 47 U.S.C. § 154(i), provides that the FCC may issue "such orders, not inconsistent with this [Act], as may be necessary in the execution of its functions." 47 U.S.C. § 154(i). This section has been interpreted by the Supreme Court as allowing the FCC to grant interim relief. U.S. v. Southwestern Cable Co., 392 U.S. 157, 181, 88 S. Ct. 1994, 2007, 20 L. Ed. 2d 1001 (1968). In addition, the FCC has, in the past, applied the same standard as this circuit in assessing requests for preliminary injunctions. That is, the moving party must show: a substantial likelihood of success on the merits; that relief is necessary to prevent irreparable harm; that temporary relief will not substantially harm other interested parties; and that temporary relief will be in the public interest. See Order, Participation by COMSAT Corp. in a New Imarsat Satellite Sys., 10 FCC Rcd. 1061 (1995) (citing Washington Metropolitan Area Transit Comm'n v. Holiday Tours, Inc., 559 F.2d 841 (D.C.Cir.1977)); Memorandum Opinion and Order, Business Wats, Inc. v. AT & T, 7 FCC Rcd. 7942 (1992); Memorandum Opinion and Order, Whitney Cablevision v. Southern Indiana Gas & Elec. Co., 1984 FCC LEXIS 1629 (FCC Nov. 16, 1984).
Lastly, the court concludes that no useful purpose would ensue by the retention of jurisdiction in this case. "The primary jurisdiction doctrine allows a district court to dismiss, or stay, an action over which it has subject matter jurisdiction." AT & T v. MCI Communications Corp., 837 F. Supp. 13, 16 (D.D.C.1993); see also Allnet Communication Service, Inc., 965 F.2d at 1120. The central claims in this case are those which allege violations of the Communications Act and which lie within the FCC's primary jurisdiction.
The remaining claims are for breach of contract, intentional interference with business relations, and quantum meruit. These claims are fundamentally premised on the central claims; and are thus incidental in nature. See Far East Conf. v. United States, 342 U.S. 570, 577, 72 S. Ct. 492, 495-496, 96 L. Ed. 576 (1952). Plaintiffs' breach of contract claim is dependent upon the validity of TTS's tariff. The viability of the intentional interference of business relations claim depends upon the appropriateness of AT & T's decision not to interconnect its services with those of TTS. Similarly, plaintiffs' quantum meruit claim depends upon the FCC's determination of the validity and reasonableness of TTS's tariff and practices. The entire dispute will therefore be resolved by the FCC and as such the court finds no reason to *484 hold the lawsuit in abeyance.[17] Accordingly, this action shall be dismissed.
IV. Conclusion
Resolution of the issues before the court by the FCC, the agency charged by Congress with regulating the telecommunications industry, will promote uniformity of regulation of the telephone industry and prevent the possibility of inconsistent results. Since agency referral is appropriate, the court declines to entertain plaintiffs' request for injunctive relief in order to avoid encroaching upon the province of the FCC by engaging in an analysis of the underlying merits of this action. The court further concludes that holding this action in abeyance is unnecessary under the circumstances of this case and therefore this action is dismissed.
Accordingly, pursuant to this court's order dated February 29, 1996,
(1) Defendant's Motion to Refer this Case to the Federal Communications Commission is hereby granted;
(2) Plaintiffs' Motion for a Preliminary Injunction is hereby denied;
(3) Plaintiffs' Application for a Temporary Restraining Order is hereby denied; and
(4) All other Motions are hereby denied as moot.
NOTES
[1] The court grants AT & T's motion for leave to file a consolidated memorandum incorporating both its opposition to plaintiffs' motion for a preliminary injunction and its motion to refer this case to the FCC; and plaintiffs' motion for leave to file a second amended complaint.
[2] Preliminarily, the court notes that the parties jointly moved the court to enter a proposed briefing schedule. The court granted the motion and adopted the proposed schedule. Pursuant to the schedule, the briefing of all the relevant issues was to be completed by January 23, 1996. However, the parties continued to inundate the court with unnecessary filings until February 7, 1996. The parties requested in their motion that a hearing be held on January 26 or January 30, 1996 or any time thereafter that was convenient to the court. However, after evaluating the voluminous submissions of the parties, the court determined, as is the preference in this jurisdiction, that the outstanding motions should be resolved on the papers.
[3] Competitive access providers are entities that provide access services in competition with monopoly local exchange carriers. These types of carriers are categorized as non-dominant because they lack the market power of dominant carriers. Dominant carriers, on the other hand, are those that possess market power. 47 C.F.R. § 61.3(o).
[4] Audiobridge is an entity that provides a multiple voice bridging service that allows multiple members of the public to engage in simultaneous conversations and thus AT & T's reference to TTS's enterprise as constituting a "chat line."
[5] The court grants TTS's motion for joinder of parties in the motion for preliminary injunction. Atlas is thus incorporated in the present action as a plaintiff.
[6] AT & T's Consolidated Memorandum in Support of AT & T's Motion to Refer this Case to the FCC and in Opposition to Plaintiffs' Motion for a Preliminary Injunction at pp. 5-6 and Plaintiffs' Motion for a Preliminary Injunction at pg. 7.
[7] The court notes that his latter request was made in plaintiffs' reply memorandum in support of their motion for a preliminary injunction. The court does not rule on the propriety of making new requests for injunctive relief in a reply. However, plaintiffs should have specified the entirety of their request in the original motion so as to provide AT & T with sufficient notice.
[8] Section 201(a) provides, in pertinent part,
It shall be the duty of every common carrier engaged in interstate or foreign communication by wire or radio to furnish such communication service upon reasonable request therefor; and, in accordance with the orders of the Commission, in cases where the Commission, after opportunity for hearing, finds such action necessary or desirable in the public interest, to establish physical connections with other carriers. 47 U.S.C. § 201(a).
Section 214(a) provides, in pertinent part,
No carrier shall discontinue, reduce, or impair service to a community, or to part of a community, unless and until there shall first have been obtained from the Commission a certificate that neither the present nor future public convenience and necessity will be adversely affected thereby ... 47 U.S.C. § 214(a).
Section 202 provides that,
It shall be unlawful for any common carrier to make any unjust or unreasonable discrimination in charges, practices, classifications, regulations, facilities, or services for or in connection with like communication service, directly or indirectly, by any means or device, or to make or give any undue or unreasonable preference or advantage to any particular person, class or persons, or locality, or to subject any particular person, class of persons, or locality to any undue or unreasonable prejudice or disadvantage. 47 U.S.C. § 202.
Lastly, in their application for a temporary restraining order filed subsequent to plaintiffs' motion for a preliminary injunction, plaintiffs allege that AT & T is violating Section 251(a)(1) of the Communications Act of 1996.
That section provides that,
(a) each telecommunications carrier has the duty
(1) to interconnect directly or indirectly with the facilities and equipment of other telecommunications carriers. 47 U.S.C. § 251(a)(1).
[9] Plaintiffs themselves, in their application for a temporary restraining order, recognize that "the present action may be viewed as an interconnection case," to the extent Section 251 of the 1996 Communications Act may be implicated. Plaintiffs Application for a Temporary Restraining Order, at 28. An interconnection dispute, "involving, as it must, the comparative evaluation of complex technical, economic, and policy factors, as well as consideration of the public interest, should be made, in the first instance, by the administrative agency which has been entrusted with the primary responsibility for making such a determination and which has the expertise necessary for the development of sound regulatory policy." MCI Communications Corp., 496 F.2d at 224.
[10] The cases cited by plaintiffs for their proposition that Section 201(a) establishes an unconditional duty on the part of AT & T to interconnect its services with those of TTS are inapposite. MCI Telecommunications Corp. v. FCC, 765 F.2d 1186 (D.C.Cir.1985) and MCI Telecommunications Corp. v. FCC, 712 F.2d 517 (D.C.Cir.1983), involved MCI's challenge of an FCC directive, not the scope of Section 201 or the duties of common carriers pursuant to the same. United States v. Western Elec. Co., Inc., 578 F. Supp. 668 (D.D.C.1983) and U.S. v. Western Elec. Co., Inc., 569 F. Supp. 1057 (D.D.C.1983), concerned a motion for clarification of the consent decree, entered into by AT & T and the U.S. government, which reorganized the telephone system; Section 201 of the Communications Act was not addressed. Lastly, American Trucking Ass'ns, Inc. v. Atchison, T & S Rwy. Co., 387 U.S. 397, 87 S. Ct. 1608, 18 L. Ed. 2d 847 (1967), pertained to the Interstate Commerce Act, not the Communications Act.
[11] It is when there has been a discontinuance, reduction, or impairment of service to the carrier's customer, at which point the FCC proceeds to determine whether Section 214 has been violated. Id.
[12] The court notes, however, that plaintiffs do not only raise a Section 214 claim but rather, plaintiffs' amended complaint is based on seven counts: violations of §§ 201, 202, 214 and 251; breach of contract; intentional interference with business relations; preliminary and permanent injunctive relief; and quantum meruit. However, plaintiffs' common law claims are fundamentally premised on plaintiffs' claims that AT & T must interconnect its services with TTS. Consequently, "[t]he presence of additional, subordinate claims by [plaintiffs] does not make primary jurisdiction any less suitable ... it would make little sense to refrain from applying primary jurisdiction merely because of an ancillary claim that ... would [be] reach[ed] only after examination of ones clearly within the agency's purview." Allnet Communication Service, 965 F.2d at 1121-1122.
[13] TTS only disputes the ease with which its customer[s] can reach its services through other long-distance carriers.
[14] Plaintiffs themselves allege that AT & T is violating FCC policy concerning competitive access providers. Furthermore, plaintiffs claim that AT & T through this action is seeking to establish a precedent for its continued unlawful treatment of new market entrants. The FCC is in a more suitable position than this court to determine such claims.
[15] The court notes that the FCC has consistently acted in an expedited fashion when requests for injunctive relief have been lodged before it. See, e.g., In Participation by COMSAT Corp. in a New Imarsat Satellite Sys., 10 FCC Rcd. 1061 (1995) (ruling within thirty-six days); Order, TKR Cable Co.; Petition for Stay, 9 FCC Rcd. 3189 (1994) (acting within a month); Public Notice, Denver Area Educational Telecommunications Consortium, Inc. v. Telecommunications, Inc., 1995 FCC LEXIS 6520 (FCC Oct. 4, 1995) (acting within days); Report and Order, Southern New England Tel. Co. Expedited Petition for Emergency Interim Relief, Preliminary Injunction and Stay, 1995 WL 619499, 1995 FCC LEXIS 6687 (FCC Oct. 10, 1995) (same).
[16] The following discussion on injunctive relief applies equally to plaintiffs' motion for a preliminary injunction and plaintiffs' application for a temporary restraining order.
[17] Plaintiffs rely on two cases for the position that the court should not dismiss the case. However, both cases are distinguishable from this case. In American Ass'n of Cruise Passengers v. Cunard Line, 31 F.3d 1184 (D.C.Cir.1994), the court held that the district court should not have dismissed claims over which it had original jurisdiction. In that case, the two sets of claims brought forward by plaintiff were legally distinct and had to be brought in two separate fora, the Federal Maritime Commission and the district court. Furthermore, the FMC's primary jurisdiction was not implicated by the claims that had to be brought in district court. Conversely, the claims in this case are not legally distinct and the incidental claims do implicate the FCC's primary jurisdiction. In addition, in In re Long Distance Tele. Litigation, 831 F.2d 627 (6th Cir.1987), the court explicitly found that the court should not have dismissed counts which did not require "agency expertise for their treatment." Id. at 633. The court also stated that if the dismissed counts related to the issue rates or service, then dismissal would be appropriate. Id. at 634. The incidental claims in this case are intricately intertwined with the others, and as such require agency expertise for their resolution. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581212/ | 147 N.W.2d 689 (1967)
STATE of Minnesota, Respondent,
v.
Barry Norman JACKSON, Appellant.
No. 39951.
Supreme Court of Minnesota.
January 6, 1967.
*690 John J. Killen, Jr., Duluth, for appellant.
Robert W. Mattson, Atty. Gen., St. Paul, John Arko, County Atty., Keith Brownell, Asst. County Atty., Duluth, for respondent.
OPINION
KNUTSON, Chief Justice.
Defendant was convicted after a trial by a jury of the crimes of kidnapping, rape, and robbery. He appeals from an order denying his motion for judgment notwithstanding the verdict or for a new trial.
On April 21, 1964, Frederick Martin, Jr., a 19-year-old airman at the Duluth Air Base, picked up 19-year-old Carol Suihkonen, a girl he had dated for about 4 months, at her home in Duluth. They went for a ride and later parked in Martin's car on a side road near Lake Superior a few miles north of Duluth. They arrived at that spot at about 8:45 p.m. Approximately a half hour later an armed, heavy-set man wearing glasses and a white bandanna on his face flung open the driver's door and told Martin to get out of the car with his hands up. Martin was then ordered to the rear of the car, where he noticed a lighter, slender man who also had a gun. The first man ordered Martin into his trunk and locked the trunk lid.
The two masked men placed Miss Suihkonen between them in the front seat of Martin's car and drove about a mile down the highway. There they stopped the car and locked Miss Suihkonen inside the trunk with Martin. At the time that the heavy-set man opened the trunk lid to put Miss Suihkonen inside, Martin turned to try to get a look at the man, but the man cocked his revolver and told Martin that if he moved again he would be killed. The car was *691 then driven for about a half hour until it got stuck in a ditch.
The trunk was opened and the headlights from another car, parked a block or two behind Martin's car, lighted up the area somewhat. The heavy-set man ordered Miss Suihkonen out of the trunk and Martin was robbed of his billfold by the same man. The trunk lid was again closed on Martin and an oily rag was placed over Miss Suihkonen's face. During this period of time, which Miss Suihkonen estimated to be about a minute or two, the heavy-set man did not have his mask on and Martin and Miss Suihkonen both had a chance to look at his face.
The other car was driven up and Miss Suihkonen was placed between the two men in the front seat. The car was driven about 5 minutes, then stopped, and Miss Suihkonen was put into the rear of the car with the heavy-set man. While the other man drove, her clothes were partially removed and the heavy-set man completed sexual intercourse with her. The car was again stopped, the lighter man got into the rear seat and also completed sexual intercourse with Miss Suihkonen while the heavy-set man drove. Sometime later the car was parked and each of the men completed sexual intercourse with Miss Suihkonen once more.
The men eventually asked Miss Suihkonen where she lived and she directed them to her home. They released her about a block from her home at about 11 or 11:15 p.m. Her hands had been tied together behind her back by using her bra and the oily rag still covered her face. Miss Suihkonen went into her home and was taken to the hospital by her mother, where she was examined by an intern. Tests revealed that she had had sexual intercourse with someone that evening. The doctor found no bruises, lacerations, or abrasions.
Martin was able to release himself from the trunk of his car, found a house nearby, and called the police prior to the time Miss Suihkonen was released.
The following morning, April 22, a burglary of the Donald MacDonald residence in Duluth was reported to the police by the caretaker of the home. That same morning a loaded revolver was found by some children on the chassis of an automobile parked behind the house where defendant, Barry Jackson, lived with coaccused Herrick Hellem. It was turned over to the police and when checked out was found to be from property taken in an earlier burglary in Duluth on April 17, 1964. The police then checked the area where the revolver was found and discovered the property taken in the MacDonald burglary in the attic of the garage on the property where defendant Jackson lived.
While the police were investigating the finding of the revolver, their car was spotted by defendant Jackson. Hellem and he left town in Jackson's 1955 Oldsmobile, traveling through Wisconsin and Iowa and into Wyoming, where they worked for a month. Jackson testified that they left Wyoming; abandoned the car near Colorado Springs, Colorado; went to Dallas, Texas; and after staying there a few days returned to Duluth and voluntarily gave themselves up to the police and admitted they had committed the MacDonald burglary and other burglaries.
Jackson was questioned concerning the rape and kidnapping of Miss Suihkonen and the robbery and kidnapping of Martin, but denied any participation in those acts. He admitted being with Hellem the entire evening of April 21, 1964, but stated it was impossible for them to have been guilty of the crimes because they were burglarizing the MacDonald residence at the time.
Separate lineups were held for both men; both Martin and Miss Suihkonen identified Hellem as the heavy-set man with glasses, but neither could identify defendant Jackson. In fact, Martin picked out another man in the lineup with Jackson as being the lighter assailant.
Two or three days after the crimes occurred Martin received his Air Force *692 identification card, which had been in his billfold at the time he was robbed, in the mail. It had been dropped in a mailbox and was found by postal employees. Police officers testified that during the questioning of Jackson he admitted that he placed the identification card in the mail, but Jackson testified that the police brought up the topic and he only commented that putting the ID card in the mail was a nice gesture by whoever did it, because losing an ID card means a restriction of a service man's liberty off base.
Jackson's car was located in Wichita, Kansas, and returned to Duluth. It was later examined by the State Crime Laboratory. No evidence of any kind was found to indicate that Miss Suihkonen had ever been present in Jackson's car or that any acts of rape had been perpetrated in the car.
Jackson and Hellem were charged with the robbery and kidnapping of Martin and forcible rape and kidnapping of Miss Suihkonen. They were granted separate trials. Jackson was tried first and convicted of all charges.
1. Defendant asserts as one ground for a new trial that after the trial he discovered that the foreman of the jury was a former deputy sheriff. He concedes that the juror was not interrogated on the voir dire examination as to his present or former occupation, but states that the juror was asked whether there was any reason why he could not be a fair and impartial juror and claims that in answer to that question the juror should have disclosed his former occupation. The trial judge in a memorandum attached to his order denying the motion for a new trial said:
"* * * This Court does not question the statement of Mr. Balach [defendant's attorney at the trial] that he did not know that Mr. Anderson was connected with the Sheriff's office at any time, but if it weren't for the Court's confidence in Mr. Balach's integrity, I would state that it would seem absolutely incredible that Mr. Balach, who was at one time assistant county attorney when Edwin Anderson was one of the outstanding deputy sheriffs on the first floor in the Court House, and Mr. Balach's office was on the third floor, that Mr. Balach would not know that Anderson was a deputy sheriff. In addition to that, there is no reason to doubt Mr. Anderson's integrity, at all, as a juror, and if there was certain testimony that would have been favorable to the defendant in this case, with all of his background Mr. Anderson would no doubt have been one of the first jurors to discern it."
We accept as true Mr. Balach's affidavit that he did not know juror Anderson was a former deputy sheriff; we also realize that in all probability defendant would have exercised one of his peremptory challenges to strike Mr. Anderson had he known of his former occupation.
The authorities are not at all in harmony concerning whether it is error per se to permit police or other law-enforcement officers to act as jurors. The subject is annotated in 140 A.L.R. 1183 and it would serve no useful purpose for us to discuss the cases pro and con in this opinion. For a note on a closely analogous topic, see 21 Minn.L.Rev. 608.
We do have a number of statutory exemptions from jury service,[1] but under Minn.St. 631.33 these exemptions are a privilege of the exempt person and not a disqualification. We have not had occasion to consider the precise question of the propriety of a former deputy sheriff's serving as a juror, but we have considered some related questions regarding the right *693 to a new trial after discovery that jurors were either subject to challenge for implied bias or so undesirable that a peremptory challenge would probably have been exercised had the facts been known. Thus, in State v. Boice, 157 Minn. 374, 376, 196 N.W. 483, we held that discovery that a juror was the husband of complainant's cousin in a paternity case did not ipso facto lead to a new trial when discovered after the trial. We said:
"* * * The rule is that a defeated litigant is not entitled as a matter of right to have a verdict set aside because a juror was incompetent, although his incompetency was not known or discovered until after the trial. In such case there may be an appeal to the discretion of the trial court, whose duty it is to consider the nature of the objection to the juror, the diligence exercised to ascertain it in due time, and the other circumstances of the case."
In State v. Durnam, 73 Minn. 150, 75 N.W. 1127, it appeared that one of the jurors was not a citizen. There again we held that discovery after trial of a cause for challenging a juror did not per se require a new trial. In State v. Polk, 263 Minn. 209, 116 N.W.2d 540, we held that discovery that one of the jurors was admitted to practice law in another state did not necessarily require a new trial even though in all probability such juror would have been challenged had the fact been known at the time he was examined. And again, in Atkinson v. Mock, 271 Minn. 393, 135 N.W.2d 892, it appeared after trial that one of the jurors was a first cousin once removed of the plaintiff and as such subject to challenge for implied bias under § 631.31; but that after-trial discovery of such fact would not necessarily lead to a new trial.
Here there is no showing of actual bias. While it may be a justifiable assumption that a former deputy sheriff would be more inclined to believe police officers with whom he had worked in the past than witnesses of an accused defendant, that is not necessarily so. The trial court, being acquainted with the juror, was of the opinion that there was no reason to doubt his integrity. We think a matter of this kind must be left largely to the discretion of the trial court except possibly where the evidence is of doubtful sufficiency to sustain a conviction.
2. Aside from the above assignment of error, defendant's thrust is directed mainly at the action of the trial court in injecting himself into the trial by means of "judicial levity, assistance to the prosecuting attorney, and prejudicial comments on certain testimony." We have carefully examined a lengthy transcript of all the evidence, and while we are convinced the court did inject itself into the trial far more than should be done, we are not persuaded that defendant was thereby deprived of a fair trial. The same may be said of his complaint of judicial levity. A long trial may become tedious and the temptation exists to liven it up a bit; but there is too much danger that such action by the presiding judge may lead the jury to believe that he considers the defense a sham to justify succumbing to this temptation. We have discussed this question of the court's interposition in a case in recent decisions. See State v. Mancino, 257 Minn. 580, 102 N.W.2d 504, where we reversed a conviction due to the trial judge's comments on the evidence. In State v. Rasmussen, 268 Minn. 42, 128 N.W.2d 289, where we discussed some of our other cases on this subject, we held there should not be a new trial. Here also some of the court's remarks could better have been omitted, but we do not believe they were so prejudicial as to require a new trial.
3. Complaint is made of the admission of two pieces of evidence. The gun which was found on the chassis of an automobile behind the house in which defendant and Hellem lived was admitted over the objection of defendant. While it was never shown that this revolver was the one used by the perpetrators of the crimes for *694 which defendant was being tried, it had a relevance in that the discovery led to the examination of the premises at which defendant lived and the discovery there of the property taken in the MacDonald burglary. The MacDonald burglary was used by defendant as an alibi to show that he could not have committed the crimes for which he was being tried because at that time he was in the act of committing the burglary. While the revolver had no relevance in so far as defendant's commission of the crimes for which he was being tried is concerned, it did have an incidental connection with the whole scheme of things and we see no harm in its admission.
4. In addition, the court permitted the police officers to testify that near defendant's mother's cottage they found tracks of automobile tires which were similar to those found at the scene of the crime. They were unable to make casts of these tire treads but their testimony was connected up in some degree by the testimony of the dealer who had sold the automobile to defendant. The dealer testified that the tires on the automobile when it was brought back from Wichita, Kansas, were the same ones that were on the car when he sold it. While it is impossible to definitely prove the tire tracks found at the scene of the crime were the same as those found near defendant's mother's cottage, we see no prejudicial effect from this evidence.
5. Finally, it is the contention of defendant that the evidence did not sustain his conviction of the crimes for which he was tried. Essentially it is his contention that he was deprived of the right to a separate trial and a fair trial because Hellem was really tried and not defendant. The court did require Hellem to be present in the courtroom and to stand up when called upon so that he could be identified by Martin and Miss Suihkonen. They were never able to identify defendant as one of the participants in the crime, but the evidence is conclusive that defendant and Hellem were together during the whole evening. Even defendant bases his defense on that fact. He claims that he was with Hellem and took part in the burglary of the MacDonald home at the time the crimes for which he was being tried were committed and therefore could not have been a participant in them. Hellem was never asked to testify. All he did was stand up in the courtroom so that he could be identified as the larger of the two men who participated in the crimes for which defendant was being tried. Both Martin and Miss Suihkonen were able to identify him as the one they saw at the scene of the crime. While the evidence against defendant is circumstantial, the evidence against Hellem was direct, and if Hellem and defendant were together the whole evening the inference was permissible that defendant was the second of the two men who took part in the commission of the crime. Looking at the record as a whole, we are convinced that the evidence is sufficient to sustain this conviction.
With respect to the validity of evidence showing association at the time a crime was committed with one who admittedly took part in the crime, or was proved to have done so, as circumstantial proof that defendant was a participant in the crime, see State v. Biehoffer, 269 Minn. 35, 129 N.W.2d 918; State v. Mathiasen, 267 Minn. 393, 127 N.W.2d 534.
The fingerprints of defendant were found in the MacDonald home. There is no showing, outside of the claims of the defendant, what time of the night the burglary was committed. It does appear that while the burglars were in the MacDonald home they cooked and ate some steaks which they found in the freezer; and although defendant relies on the burglary as an alibi, the jury could well believe that the burglary was committed after the crimes for which he was tried.
While we are convinced that there have been some things done during the trial of this case that could better have been left undone, an examination of the entire record *695 leads us to believe that the defendant has had a fair trial and that the evidence is such that the conviction should be affirmed.
Affirmed.
PETERSON, J., not having been a member of this court at the time of the argument and submission, took no part in the consideration or decision of this case.
NOTES
[1] Minn.St. 3.081, exempting members, officers, and employees of the legislature during a legislative session; § 192.24, exempting members of the National Guard; § 628.43, exempting a number of public officials, including constables, and persons engaged in several other employments and professions, including attorneys at law; § 628.44, exempting the director of forestry and his employees. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2165637/ | 730 N.W.2d 211 (2007)
STATE
v.
WINBERG.
No. 06-0810.
Iowa Court of Appeals.
February 28, 2007.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2455193/ | 250 P.3d 464 (2011)
241 Or. App. 572
RAMSEY
v.
MUELLER.
A144846
Court of Appeals of Oregon.
March 9, 2011.
Affirmed without opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580978/ | 42 So. 3d 245 (2010)
GRANT
v.
LASALLE NAT. BANK ASS'N.
No. 5D09-3454.
District Court of Appeal of Florida, Fifth District.
August 17, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581113/ | 147 N.W.2d 630 (1967)
181 Neb. 259
William P. HOMAN, Legal Guardian and next friend of Eugene J. Homan, Incompetent, Appellant,
v.
Lucille HOMAN, Appellee.
No. 36399.
Supreme Court of Nebraska.
January 6, 1967.
*631 Jack L. Spence, Omaha, for appellant.
Martin A. Cannon, Omaha, for appellee.
Heard before WHITE, C. J., and CARTER, SPENCER, BOSLAUGH, BROWER, SMITH and McCOWN, JJ.
BOSLAUGH, Justice.
This is an action to annul a marriage between Eugene J. Homan and Lucille Homan, the defendant. Although the action is brought by a guardian and next friend, Eugene J. Homan will be referred to as the plaintiff. The trial court found that the marriage was valid and dismissed the action. The guardian has appealed.
The petition alleged that the ward was mentally incompetent at the time of the marriage. By statute a marriage is void "when either party is insane or an idiot at the time of marriage, and the term idiot shall include all persons who from whatever cause are mentally incompetent to enter into the marriage relation." Section 42-103, R.S.Supp., 1965.
A marriage contract will not be declared void for mental incapacity to enter into it unless there existed at the time of the marriage such a want of understanding as to render the party incapable of assenting thereto. Fischer v. Adams, 151 Neb. 512, 38 N.W.2d 337. Mere weakness or imbecility of mind is not sufficient to void a contract of marriage unless there be such a mental defect as to prevent the party from comprehending the nature of the contract and from giving his free and intelligent consent to it.
Absolute inability to contract, insanity, or idiocy will void a marriage, but mere weakness of mind will not unless it produces a derangement sufficient to avoid all contracts by destroying the power to consent. Aldrich v. Steen, 71 Neb. 33, 98 N.W.2d 445; Adams v. Scott, 93 Neb. 537, 141 N.W. 148. A marriage is valid if the party has sufficient capacity to understand the nature of the contract and the obligations and responsibilities it creates. Fischer v. Adams, supra; Kutch v. Kutch, 88 Neb. 114, 129 N.W. 169.
The plaintiff has a history of mental illness and mental deficiency. When he was 5 years old he was ill with scarlet fever and encephalitis which resulted in a permanent impairment of his mental ability. In December 1950, the plaintiff was treated for schizophrenia. Treatment for this condition continued through 1958 but there is no evidence that the plaintiff received any treatment for this condition between 1958 and 1963. The plaintiff attended Immaculate Conception Grade School in Omaha, Nebraska, and completed *632 3 years of high school. He was then employed as a laborer by Goodwill Industries and later by Armour & Company.
The plaintiff first met the defendant in 1959. They commenced keeping company and approximately 3 months later the plaintiff proposed marriage. The marriage took place about 6 months later on February 27, 1960. The plaintiff was then 29 years of age.
During the courtship the plaintiff made plans to purchase a house and saved a part of his earnings for the downpayment. A property was selected, a mortgage negotiated, and the purchase completed. The parties moved into their first home a week after the ceremony. In March 1962, the parties traded this home for a larger property.
In 1963 the plaintiff was sent home from his employment with instructions to obtain medical treatment. The plaintiff consulted a physician, was referred to a psychiatrist, and was hospitalized.
At the time of the trial the plaintiff was on leave from the hospital. He was living with his parents in Omaha and working part time. The defendant last saw the plaintiff in August 1964. He was placed under guardianship in October 1964. The plaintiff did not attend the trial and, apparently, did not know of the action or the trial.
A marriage is presumed valid, and the burden of proof is upon the party seeking annulment. Adams v. Scott, supra. To succeed in this action it was necessary for the guardian to establish that the plaintiff was mentally incompetent on February 27, 1960.
The plaintiff suffers from a mental impairment that is the result of a childhood illness. This condition is permanent and existed at the time of the marriage. The guardian produced the testimony of the psychiatrist who had treated the plaintiff prior to the marriage. This witness testified that the plaintiff had a mental age of approximately 11 years; an intelligence quotient of between 69 and 75; and that the plaintiff would be classified as a highgrade moron. This witness further testified that, in his opinion, the plaintiff would have an inadequate or superficial understanding of the responsibilities of marriage.
The defendant testified at length concerning her acquaintance and relationship with the plaintiff from the time of their first meeting in 1959 until the hospitalization of the plaintiff in 1963. This evidence contradicts that of the guardian and tends to prove that the plaintiff had a sufficient understanding of the marriage relationship and its obligations and responsibilities. During this time the plaintiff was steadily employed as a maintenance and custodial worker, managed his finances, purchased two properties, and had a reasonably normal life. The evidence supports an inference that the marriage would have continued without difficulty if the plaintiff's mental illness had not recurred in 1963.
Although the plaintiff suffered from schizophrenia prior to the marriage and again in 1963, the evidence shows that this illness was in remission at the time of the marriage and was not a disabling factor at that time. Although handicapped mentally, the plaintiff had sufficient ability to transact business and the capacity to enter into the marriage on February 27, 1960.
The marriage in this case may have been unwise or unfortunate, but it was not void. The judgment of the district court is correct and it is affirmed.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580912/ | 42 So.3d 243 (2010)
GRIGGS
v.
STATE.
No. 3D10-1837.
District Court of Appeal of Florida, Third District.
August 3, 2010.
Decision Without Published Opinion Habeas Corpus denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580970/ | 147 N.W.2d 211 (1966)
Johanna L. MEADER, Appellee,
v.
PAETZ GROCERY CO., Inc., Appellant.
No. 52219.
Supreme Court of Iowa.
December 13, 1966.
*213 Shaff & Farwell, Clinton, for appellant.
Matt K. Wolfe, Clinton, for appellee.
*214 LARSON, Justice.
Plaintiff's law action asked damages for personal injuries suffered when she tripped and fell over a box of fruit placed on the floor of an aisle by an employee engaged in restocking a shelf in a self-serve grocery store. In her petition she alleged defendant negligence in failing to maintain its premises in a safe condition for plaintiff's use, in carelessly placing an obstacle in the aisle used by customers, in failing to warn her of this danger, and in displaying merchandise at this place which would district the attention of an invitee to the dangerous condition of the floor. She further alleged freedom from contributory negligence. Defendant's motions for directed verdict were overruled and there was a verdict and judgment rendered in plaintiff's favor. Defendant appeals, contending the trial court erred in overruling defendant's motion for a directed verdict on the grounds (1) that the plaintiff had failed to prove actionable negligence on the part of the defendant, and (2) that the plaintiff had failed to show she was free from contributory negligence.
The principal issue in this appeal is whether the evidence submitted is sufficient to generate a jury question as to defendant's primary negligence, or whether the defendant exercised reasonable care to make its premises safe for plaintiff's presence as an invitee or for her use for the purpose of the invitation. The trial court felt that a jury question was generated. We must disagree.
At all times herein material defendant owned and operated a self-serve supermarket grocery store at 1105 North Second Street in the city of Clinton, Iowa. On October 3, 1964, at approximately 2:30 P.M. plaintiff, age 74, a regular patron, accompanied by her daughter, entered the south door of this store for the purpose of purchasing groceries. She specifically desired to purchase some cans of peaches then on sale. She knew where they were located and, when her daughter obtained a grocery cart, they proceeded down a seven-foot-wide aisle toward the south to the place where the peaches were shelved, a distance of about 20 feet. At that place the aisle turned eastward and the shelf containing the peaches was on the south wall. At this time she saw a stock boy putting cans of peaches on the shelves. She approached him on his right and, after obtaining several cans of peaches, plaintiff turned to go down the aisle toward the east, tripped over a box of peaches directly behind the boy, and fell. She received injuries therefrom, but as they are not material to a decision on the questions raised herein, they need not be discussed.
It appears defendant's stock boy had brought in four boxes on a two-wheeled cart and had put them on the floor of the aisle, leaving enough room for him to stand between them and the shelf and room in the aisle for two grocery carts to move eastward at the same time. The floor was black and white tile squares, and the boxes containing 24 No. 2½ cans were brown in color. The boy had emptied three boxes and had one left on the floor at the time of this accident.
Plaintiff admitted she was familiar with the manner in which the shelves in this store were restocked, and knew the stock boys put cans of fruit and groceries on the shelves, and knew that is what the boy was doing as she approached him. She denied seeing the box of peaches on the floor behind the boy until after she had tripped over it.
I. In considering the propriety of a directed verdict for defendant, we must of course give plaintiff's evidence the most favorable construction it will reasonably bear. Rule 344(f) (2), Rules of Civil Procedure. However, we find here the relevant facts not in dispute.
The evidence establishes that a box of peaches was on the floor of the seven-foot aisle directly behind the stock boy, who was within a foot of the shelves where *215 the cans of peaches were being placed, that the aisle was not blocked, that this manner of restocking the shelves was the customary way of restocking used by other stock boys, that plaintiff was familiar with this process, that the lighting was good, and there was nothing unusual or abnormal in the situation plaintiff faced on this occasion. The usual sale tags appeared throughout the store on shelved items to attract customers' attention, but plaintiff's objective was first to obtain cans of peaches and then seek other items she had on her list which were located on down the east aisle. Only plaintiff, her daughter who did not see her fall, and the stock boy, were in the vicinity at the time. No warning was given plaintiff of the presence of this box in the aisle.
II. Plaintiff admittedly had the status of an invitee. As a business visitor she was invited to enter or remain on the permises for a purpose directly or indirectly connected with business dealings with the possessor of the property. See Restatement, Second, Torts, § 332(3).
As is pointed out in Restatement, Second, Torts, supra, Comment (a), invitees are limited to those persons who enter or remain on land upon an invitation which carries with it an implied representation, assurance or understanding that reasonable care has been used to prepare the premises and make them safe for their reception. Such invitees are entitled to expect such care, not only in the original construction of the premises and in any activities of the possessor or his employees which may effect their condition, but also in inspection to discover their actual condition or any latent defects followed by such repairs, safeguards, or warnings as may reasonably be necessary for their protection under the circumstances. Restatement, Second, Torts, § 343, Comment (b).
Our primary concern in such matters is whether under the revealed circumstances there has been a breach of duty on the part of the possessor of the premises toward the invitee.
III. It is well established in most jurisdictions, including our own, that the owner of a retail store is required to maintain it in a reasonably safe condition for customers. Although the owner must exercise reasonable care to keep the premises reasonably safe for customer use, the owner is not an insurer against accident. Christianson v. Kramer, 255 Iowa 239, 243, 122 N.W.2d 283, and citations; Hanson v. Town & Country Shopping Center, Inc., Iowa, 144 N.W.2d 870. Also see 65 C.J.S. Negligence § 5(4), page 512; 38 Am.Jur., Negligence, § 96, page 754. As stated in Hanson, an open or obvious defect might be the equivalent of a trap or pitfall if it appears the possessor knew or should know that the invitee would have no reason to anticipate it, appreciate the hazard created by the condition, or guard against it. We said in that case: "While ordinarily a possessor of real estate would not be liable (or would not reasonably anticipate an unreasonable risk of harm to an invitee from an open or obvious defect), negligence may exist even though a defect is, in fact, open and obvious where the circumstances are such that there is reason to believe it would not be discovered or become obvious to the invitee or the risk of harm involved would not be anticipated or appreciated by the invitee." Of course, the test as to whether the invitee under the circumstances should anticipate or appreciate the risk of harm involved is not a subjective test, but is that of a reasonably prudent man under the revealed circumstances.
While, then, an open or obvious defect might be the equivalent of a trap or pitfall simply because the possessor should know that the invitee would have no reason to anticipate it and appreciate the hazard created by the condition so as to guard against it, where the possessor has every reason to know the invitee, as a reasonably prudent person, would anticipate and appreciate *216 the hazard, there is no liability if the invitee disregards it.
As expressed in Section 343, Restatement, Second, Torts: "A possessor of land is subject to liability for physical harm caused to his invitees by a condition on the land if, but only if, he (a) * * * (b) should expect that they will not discover or realize the danger, or will fail to protect themselves against it, and (c) * * *." Section 343A further provides: "A possessor of land is not liable to his invitees for physical harm caused to them by any activity or condition on the land whose danger is known or obvious to them, unless the possessor should anticipate the harm despite such knowledge or obviousness."
IV. In a long line of cases following Atherton v. Hoenig's Grocery, 249 Iowa 50, 55, 86 N.W.2d 252, 255, we have applied the rule that a possessor of real estate may avoid the liability owed to an invitee in two ways, "by making and keeping his lands safe, or by warning of the dangers." We observed that actual knowledge of defects and dangers is equivalent to, perhaps better than, a warning. There we were considering Section 343, Restatement, Torts, as it then appeared, and paid particular attention to hidden dangers, traps and pitfalls, as distinguished from obvious and apparent defects in the premises. Since that time we have recognized the change in the Restatement, and in Hanson v. Town & Country Shopping Center, Inc., supra, we said there is and can be no arbitrary rule that the possessor of land is under no duty to invitees with respect to open or obvious defects. We also stated in Hanson: "Defects in premises which are in no sense hidden and could only be classified objectively as open and obvious, may be of such nature that the possessor should know the invitee would not anticipate or guard against them in using the premises within the scope of the invitation."
Thus, while it is important to determine in a given case whether the invitee comes upon the premises after a warning or knowledge of its dangerous condition, that fact does not alone qualify the duty imposed upon the possessor to exercise reasonable care for the safety of the invitee. What constitutes due care of an inviter is always determined by the circumstances and conditions surrounding the transaction under consideration. Brown v. Slack, 159 Neb. 142, 65 N.W.2d 382, 385.
The standard of care required is ordinary care under the circumstances. The degree of diligence required in a particular case in exercising ordinary care will vary with and must be measured in the light of all surrounding circumstances, including physical facts generally. Lamson & Sessions Bolt Co. v. McCarty, 234 Ala. 60, 173 So. 388, 391, quoted in Brown v. Slack, supra, 159 Neb. 142, 65 N.W.2d 382, 385, which we cited with approval in Bartels v. Cair-Dem, Inc., 255 Iowa 834, 840, 124 N.W.2d 514; Morrison v. Suburban Trust Co., 213 Md. 64, 66, 130 A.2d 915, 916; Chalmers v. Great Atlantic & Pacific Tea Co., 172 Md. 552, 555, 192 A. 419, 420.
In Morrison, which was an action for personal injuries sustained when plaintiff tripped over a handle of an automobile jack protruding from an automobile in defendant's garage, a judgment was entered for defendant and plaintiff appealed. The court held that the garage owner had not breached any duty owed the plaintiff-visitor, and was not negligent in failing to anticipate the plaintiff would not foresee and guard against the hazard present in the conduct of that business.
In Chalmers, an invitee tripped and fell over a box of canned goods in a narrow aisle leading to a meat counter, and a directed verdict was set aside and a new trial ordered due to the abnormal circumstances revealed by the record. However, the court therein recognized and stated the rule that a proprietor is not required to conduct an ordinary and lawful business at his peril merely because business visitors may be injured due to conditions commonly incident *217 to the business, when they can avoid injury by exercising a degree of vigilance required by conditions. It stated liability follows where the injuries were caused by some abnormal condition of the premises which created a danger which the visitor had no reason to anticipate or to guard against. It pointed out where boxes, cartons, etc., commonly found in a grocery store, are placed in a more or less disorderly way, business visitors must expect to find and guard against those more or less hazardous conditions "because they are an ordinary and usual incident of the business" of which an invitee should be aware.
V. It is conceded here that the defendant store operator owed plaintiff the duty of ordinary care, but it is not realistic to say that ordinary care in the conduct of a self-serve grocery store, a restaurant, a garage, or a lumber yard, is the same. As the Maryland court stated in Morrison v. Suburban Trust Co., supra, ordinary care in the conduct of a garage does not require that the floor area used in the day by day operations be free of jack handles which, in the nature of the business, must constantly be used, or, if not, that a warning of their presence must be given.
Here the conduct of the self-service market was usual and the process of restocking the shelves was normal. Under these circumstances, did defendant have any reason to believe a patron who had been in the store many times shopping would not realize the hazard surrounding the stock replacement? Obviously, it is not the subjective test that must be applied to the term "realization" in such matters. Regular patrons are presumed to know a stock boy replaces the stock, when needed, from boxes, cartons, etc., and they are usually located at or near the feet of the stock boy. Was there any evidence of a breach of duty to use due care under the circumstances here? Nothing appears out of the ordinary in the conduct of this business which we think would justify a charge of defendant negligence. The box from which the stock boy was working left ample room for customers to travel in the aisle. It was not claimed the position of the box on the floor was unusually placed or that it blocked the aisle, as in the lead case of Chalmers v. Great Atlantic & Pacific Tea Co., supra, 172 Md. 552, 555, 192 A. 419, 420, often cited by us in former opinions. See Warner v. Hansen, 251 Iowa 685, 102 N.W.2d 140, and Bartels v. Cair-Dem, Inc., supra, 255 Iowa 834, 124 N.W.2d 514.
VI. True, appellee contends there was evidence of a distraction by appellant, but we find this evidence far from sufficient to sustain a breach of the ordinary care requirement. Factually, this contention has little support in the record. Plaintiff did not say she was distracted by a special display. In any event it did not appear plaintiff was then looking at any special display. She knew where the items she sought were located. She had obtained the peaches and was proceeding to the area of vegetables down the east-west aisle when she tripped over this box, a box in plain sight which was not blocking the aisle, a box which was being emptied by the very stock boy who had handed her the peaches.
VII. Defects or conditions which an invitee might reasonably be expected to anticipate and guard against in the use of the premises within the scope of the invitation, and slight defects which do not involve any unreasonable risk of harm to an ordinary individual, do not render the premises unsafe. Plaintiff testified that she was aware of the general practice of replacing stock on the shelves during store hours, and knew how this was done by the stock boys. She admitted she saw the stock boy at work stocking the peach shelves.
Unless, then, the defendant had the total duty to protect her from all hazards and insure her safety while in its store, we can find no substantial breach of its duty to provide a reasonably safe place for plaintiff to select and purchase groceries in this self-serve store. We conclude there was no *218 basis for a finding that defendant should have anticipated plaintiff, a regular patron in this store, would not see and appreciate this condition.
In any event, we think defendant and its employee were under no duty to warn plaintiff against these conditions, which were as apparent, foreseeable, and known to her as they were to the store operator. Customers in a supermarket as operated today, and especially those who have for some time been patrons of that market, as reasonably prudent persons, must be charged with the need of foreseeing what experience and familiarity with the premises and business had taught them, in all likelihood, is apt to be encountered as they traverse the aisles looking for grocery and other articles made available to them on shelves and tables. In such circumstances we think the store operator should not be charged with failure to anticipate that the patron would not realize the hazard resulting from the usual and necessary practice of keeping the shelves stocked and take reasonable care to protect himself when encountering that process. In other words, the inviter should not be charged with failure to anticipate that the invitee, aware of the business operation, will not measure up to his obligation and avoid the condition. To hold otherwise would surely make the operator an insurer, and all authorities agree the inviter's obligation does not extend that far.
The rule, then, as we view it, is that the possessor of land is held liable for harm caused to an invitee by a condition of which he was aware or, in the exercise of due care, should have been aware, only if he realizes or should realize that the condition constitutes an unreasonable risk to the invitee, and has no reason to believe that the invitee will observe the condition and realize the risk. In considering whether the invitee will discover and realize the risk, the owner is entitled to assume the invitee will act as a prudent person under the circumstances. Restatement, Second, Torts 2d, § 343.
Thus, under the circumstances herein revealed, we hold defendant was not negligent in failing to anticipate that plaintiff would not foresee and guard against the danger encountered when she approached a stock boy engaged in restocking the item she wished to purchase, which danger she actually encountered, and thus conclude there was no breach of any duty owed the plaintiff and no liability for her unfortunate fall and injury.
In view of our conclusion as to primary negligence, we find no need to discuss or determine the submitted issue as to contributory negligence.
Reversed.
All Justices concur except THORNTON, J., not sitting. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1580975/ | 919 F. Supp. 1513 (1996)
Tammy STORTS, Plaintiff,
v.
HARDEE'S FOOD SYSTEMS, INC., Imasco Holdings, Inc., and Imasco, Ltd., Defendants.
Civ. A. No. 95-1036-MLB.
United States District Court, D. Kansas.
March 11, 1996.
*1514 Donald A. McKinney, Wichita, KS, for plaintiff.
Paul P. Hasty, Jr., Wallace, Saunders, Austin, Brown & Enochs, Chartered, Overland Park, KS, for defendants.
MEMORANDUM AND ORDER
BELOT, District Judge.
This matter comes before the court for a de novo review of the United States Magistrate Judge's recommendation and report sustaining defendants Hardee's and Imasco Holdings' motion to dismiss plaintiff's amended complaint (Doc. 20).[1] The court has reviewed the file and the parties' memoranda (Docs. 22, 23, 24).
Procedural Facts
Plaintiff filed her complaint February 2, 1995. She alleged, in pertinent part, that on February 5, 1993 she was abducted from the parking lot of the Hardee's restaurant located on the Kansas Turnpike near Wellington, Kansas. She further alleged that the restaurant was negligently designed and operated "... in a manner which violated basic principles of consumer safety and crime prevention ..." and that Hardee's failed to provide proper security and other protections for her safety. Plaintiff contended that her abduction and resulting injuries and damages were the direct result of Hardee's negligence.
*1515 Plaintiff served process on Hardee's by serving C.T. Corporation Systems by certified mail postmarked May 18, 1995 and Imasco Holdings by certified mail received May 30, 1995 (Doc. 5, 6).[2] Plaintiff's reasons for waiting so long to serve defendants are not apparent. In any event, Hardee's filed a motion to dismiss on the ground that plaintiff's claim was barred by the statute of limitations (Docs. 2, 3).
Plaintiff's initial reaction to the motion was to file a first amended complaint (Doc. 4). Three days later, plaintiff filed her response to the motion to dismiss which stated, in substance, that she had abandoned the negligence claims of her original complaint and instead was pursuing a breach of contract claim which was not barred by the statute of limitations (Doc. 8). Hardee's and Imasco Holdings moved for dismissal of the first amended complaint on the ground that her claim still was barred by the statute of limitations (Docs. 9, 10). Plaintiff responded in a lengthy document which purported to discuss not only the contractual issues raised by Hardee's in its motion but also plaintiff's liability and damage theories including plaintiff's psychological condition (Doc. 11). After defendants filed their reply (Doc. 12), this court referred the motion to dismiss to United States Magistrate John Thomas Reid for a recommendation for disposition (Doc. 13). Magistrate Judge Reid's recommendation and report was filed on September 12, 1995 (Doc. 20). Plaintiff now seeks review of every aspect of Judge Reid's ruling.
Plaintiff's Contentions
The magistrate judge found that the gist of plaintiff's complaint was grounded in tort, not in contract, and was thus barred by Kansas' two-year statute of limitations, K.S.A. 60-513(a)(4). Plaintiff takes strong exception to this ruling. She argues that her claim is based upon certain specific provisions of the contract between Hardee's and the Turnpike Authority. The provisions upon which plaintiff relies are as follows:
The parties hereto shall bind themselves to the following conditions and covenants:
1. SERVICE: Operator agrees to operate the aforesaid restaurant facilities in an efficient and attractive manner and so to conduct its operations as to make its Kansas Turnpike restaurants models of proper management, both for service to the public and the winning of public esteem for Operator, its services and products, and for the Turnpike as a whole. Food and service shall be of a quality that will attract repeat business. Customers shall never be considered transients. All serving personnel shall be trained by Operator as necessary to obtain this quality of service, with emphasis given to courtesy, service to the patrons, and serving techniques.
* * * * * *
8. MAINTENANCE AND REPAIRS: For purposes of maintenance and repair, the leased premises and equipment shall be divided into three general categories: (a) buildings and related equipment, (b) restaurant equipment, and (c) leased premises.
* * * * * *
(c) Leased premises: Operator agrees to maintain the leased premises, including the area within the leased limits, in an attractive, clean, safe, and sanitary manner. Planting of shrubs, cutting of grass, and other landscaping shall be the responsibility of Authority. Authority shall also make, at its expense, all repairs to the parking areas, including resurfacing.
(d) General: Operator shall correct and remedy any and all unsatisfactory conditions inside or outside of the leased premises as they may relate to attractiveness, high quality of service, efficiency, cleanliness, safety, or sanitation, in a manner befitting the Turnpike and the facilities afforded. If Operator willfully neglects or refuses to correct or remedy such unsatisfactory conditions, which are herein defined as its responsibility, within twenty (20) days after receiving written notice from Authority to do so, then Authority shall have the right to take action to have the unsatisfactory conditions remedied and to submit a bill to Operator *1516 for the costs of the same. If such conditions persist, and after twenty (20) days have expired from the date of receipt of notice thereof by Operator, then Authority shall have the right to terminate this lease forthwith.
9. HOUSEKEEPING: Operator shall keep the buildings and leased premises in a neat and clean condition at all times.
* * * * * *
Operator shall police the areas outside the building, including entranceways, the patio area, and adjacent sidewalks, which are defined herein as sidewalks running parallel on both sides of the restaurant area, but not including the sidewalk running between the restaurant and the service station.
Authority shall keep the parking areas in a clean and sightly condition at all times, and shall make adequate arrangements for the collection of papers and trash, sweeping, hosing-down, and any other arrangements for general good housekeeping that may be necessary. Operator shall assist in keeping area free of litter to the best of its ability.
* * * * * *
25. TERMINATION:
* * * * * *
If, in the opinion of Authority,
* * * * * *
(d) if the operation of said restaurant becomes such that it is not to the best interest of the traveling public and that by reason thereof, the revenue from tolls accruing to the Authority is adversely affected, or
(e) the Operator does not maintain the properties and keep them in a clean and sightly condition and maintain the high standard of attractiveness, high quality of service, efficiency, cleanliness, safety and sanitation in a manner befitting the Turnpike and the facilities afforded as provided in Section 9 hereof; and if, in the opinion of Authority, such unsatisfactory conditions have not been completely remedied within twenty (20) days after notice has been received by Operator of such unsatisfactory conditions, then Authority shall have the right to terminate this lease forthwith on giving proper notice to Operator.
(provisions emphasized by plaintiff in bold. Doc. 22 at 4-5, 13).
Plaintiff argues that these contractual provisions impose upon defendants a higher duty than the negligence standard imposed by law, i.e., due care, and that they transcend the general rule that a business owner has no liability for injuries inflicted upon customers by the criminal acts of third parties which are committed in the business' parking lot unless "... circumstances exist from which the owner could reasonably foresee that its customers have a risk of peril above and beyond the ordinary and that appropriate security measures should be taken." Seibert v. Vic Regnier Builders, Inc., 253 Kan. 540, 548, 856 P.2d 1332 (1993).
Plaintiff concedes that she is not a party to the contract but nevertheless contends she is a third party beneficiary of the "higher duties" allegedly created by the contract.[3]*1517 Apparently recognizing that the contract language does not specifically confer third party beneficiary status upon her, plaintiff asserts that the contract is ambiguous. Plaintiff contends that she should be able to offer evidence so that a jury can decide what is meant by certain terms of the contract and whether defendants owed her a duty (Doc. 24 at 9-14).
Standard of Review
The basis of defendants' motion to dismiss was that plaintiff's claim is barred by the statute of limitations. It was not predicated upon plaintiff's failure to state a claim as a third party beneficiary and the magistrate judge's decision was not based on that ground. However, because this matter is before the court de novo and because the parties have addressed the matter of plaintiff's third party beneficiary status in their memoranda, the court has elected to treat defendant's motion as one for failure to state a claim under Fed.R.Civ.P. 12(b)(6). Because both parties have cited to it, the court has considered one matter outside the pleadings: the contract. Technically, this requires conversion of the motion to one for summary judgment. Id.; Hall v. Bellmon, 935 F.2d 1106, 1109 (10th Cir.1991). Conversion to summary judgment ordinarily requires the court to notify the parties and afford them an opportunity to present evidence. This procedure is not required, however, when the parties have had full opportunity to state their positions. In re: Harris Pine Mills, 44 F.3d 1431, 1439-40 (9th Cir.), cert. denied, ___ U.S. ___, 115 S. Ct. 2555, 132 L. Ed. 2d 809 (1995). The court finds that further evidentiary presentation is not necessary since the court's decision is one of law based upon the written contract. The parties have briefed and rebriefed the contract and third party beneficiary issues and no further briefing will be helpful.
Applicable Law
In First National Bancshares of Beloit, Inc. v. Geisel, 853 F. Supp. 1337 (D.Kan. 1994), Judge Saffels of this court summarized Kansas law pertaining to third party beneficiaries:
Recent Kansas caselaw analyzing the law of third-party contract beneficiaries divides them into the general classes of intended beneficiaries and incidental beneficiaries. Noller v. GMC Truck and Coach Div., 244 Kan. 612, 772 P.2d 271, 275 (1989) (citing Fasse v. Lower Heating and Air Conditioning, Inc., 241 Kan. 387, 736 P.2d 930 (1987)). A beneficiary may sue to enforce a contract made by others only if he is an intended beneficiary, i.e., one who the contracting parties intended should receive a direct benefit from the contract. Id., 772 P.2d at 275; Martin v. Edwards, 219 Kan. 466, 548 P.2d 779, 785 (1976).
The determination of the contracting parties' intent as to the rights of a third party beneficiary is a question of contract construction for the court, and the general rules of contract construction apply. Id. The meaning of the contract and the intent of the parties are to be deduced by the court from the instrument itself, as long as its terms are plain and unambiguous. Cornwell v. Jespersen, 238 Kan. 110, 708 P.2d 515, 521 (1985); Martin v. Edwards, 548 P.2d at 785-86....
Contracting parties are presumed to act for themselves. Id. at 785; Ronnau v. Caravan Intern. Corp., 205 Kan. 154, 468 P.2d 118, 122 (1970). Therefore the parties' intent to benefit a third person must be clearly expressed in the contract. Id.; see Fasse v. Lower Heating and Air Conditioning, 736 P.2d at 932; Martin v. Edwards, *1518 548 P.2d at 785; see also United States v. United Services Automobile Ass'n, 968 F.2d 1000, 1001-02 (10th Cir. 1992) (applying Kansas law). It is not necessary, however, for the third party to be the exclusive beneficiary of the contract; it may benefit the contracting parties as well. Fasse, 736 P.2d at 932; Martin, 548 P.2d at 785. Nor is it necessary for the third party beneficiary to be personally named in the contract, if he is a member of a designated class or otherwise identifiable as a person intended by the parties' language to benefit from the contract. Hartford Fire Ins. Co. v. Western Fire Ins. Co., 226 Kan. 197, 597 P.2d 622, 632 (1979). However, the third party must show the existence of a provision in the contract that operates to his benefit. Id.; see United States Automobile Ass'n, 968 F.2d at 1002.
First Nat. Bancshares, 853 F.Supp. at 1340-41.
Chief Judge Van Bebber made additional pertinent observations in Sinclair Oil Corp. v. Sylvan State Bank, 894 F. Supp. 1470, 1478 (D.Kan.1995):
In order for a third party to enforce a contract entered into between two other parties, the third party must show that the contract was entered into for his benefit. Cornwell v. Jespersen, 238 Kan. 110, 115, 708 P.2d 515, 520 (1985). "[A] beneficiary can enforce the contract if he is one who the contracting parties intended should receive a direct benefit from the contract." Id. "Contracting parties are presumed to act for themselves and therefore an intent to benefit a third person must be clearly expressed in the contract." Id. at 115-16, 708 P.2d 515. An "incidental beneficiary" cannot enforce a contract as a third party beneficiary. A person is an incidental beneficiary if the benefits accruing to him are merely incidental to the performance of the contract. Id.
Additional general rules of contract construction are set out in Central Kansas Credit Union v. Mutual Guar. Corp., 886 F. Supp. 1529, 1537 (D.Kan.1995):
"To be ambiguous, a contract must contain provisions or language of doubtful or conflicting meaning, as gleaned from a natural or reasonable interpretation of its language." Patrons Mut. Ins. Ass'n v. Harmon, 240 Kan. 707, 713, 732 P.2d 741 (1987). An ambiguity does not exist unless the application of the rules of interpretation leaves it genuinely uncertain which one of two or more possible meanings is the proper one. Wood River Pipeline, [v. Willbros Energy], 241 Kan. [580] at 582, 738 P.2d 866 [(1987)]. There are several relevant rules of interpretation. Beginning with the most basic, terms are given their plain, general, and common meaning. Wood River Pipeline, 241 Kan. at 586, 738 P.2d 866. Language used anywhere in the instrument is considered and construed in harmony with other provisions. Heyen, 235 Kan. at 122, 679 P.2d 1152. The meaning of a contract should not be assessed from only analyzing a single or isolated provision. Garvey Center, Inc. v. Food Specialties, Inc., 214 Kan. 224, 227, 519 P.2d 646 (1974). If a contract includes a series of writings, all writings that are part of the same transaction are interpreted together. Burge v. Frey, 545 F. Supp. 1160, 1169 (D.Kan.1982). Reasonable interpretations, rather than unreasonable ones, are favored by the law. Seacat v. Mesa Petroleum Co., 561 F. Supp. 98, 105 (D.Kan.1983). Interpretations which vitiate the contract's purpose or reduce its terms to an absurdity should be avoided. First Nat'l Bank of Olathe v. Clark, 226 Kan. 619, 624, 602 P.2d 1299 (1979). Under the guise of contract construction, the court must not rewrite or insert terms. Garvey Center, Inc., 214 Kan. at 227, 519 P.2d 646.
Courts must not rewrite a contract to achieve an equitable result under the guise of contract construction. Galindo v. City of Coffeyville, 256 Kan. 455, 466, 885 P.2d 1246 (1994). A contract is not ambiguous merely because it does not address an issue. TMG Life Ins. Co. v. Ashner, 21 Kan. App. 2d 234, 242, 898 P.2d 1145 (1995). Finally, as plaintiff herself points out, contracting parties are presumed to contract in reference to existing law and are presumed to have in mind all existing law relating for the contract. Steele *1519 v. Latimer, 214 Kan. 329, 336, 521 P.2d 304 (1974) (Doc. 24 at 7).
Discussion
The parties are familiar with the rules applicable to summary judgment. Basically, the court's initial obligation is to determine whether a disputed issue of material fact exists which requires a trial. If no such issue is found to exist, the court may decide the case on legal issues.
The following facts are not in dispute: (1) plaintiff was abducted from Hardee's parking lot; (2) at the time of her abduction, Hardee's had a written contract with the Kansas Turnpike Authority, portions of which have been set out, supra; (3) plaintiff was not a party to the contract; (4) plaintiff claims to be a third party beneficiary under the contract (Doc 4 at ¶ 11); and (5) defendants deny that the contract confers such status upon plaintiff.
Viewed in the context of summary judgment, plaintiff seeks to create a factual dispute by contending that the contract is ambiguous. She argues that she should be allowed to present expert testimony and portions of a book authored by a Hardee's employee which discusses such topics as unsafe conditions, security risks and standards of safety, all for the purpose of demonstrating ambiguity (Doc. 22 at 5; Doc. 24 at 13-14).
Plaintiff's position is untenable because it essentially ignores the rules regarding determination of third party beneficiary status and contract construction. Plaintiff's status as a third party beneficiary is determined by construction of the contract, which is a question of law, not fact. Extrinsic evidence, such as that proposed by plaintiff, is not admissible as an aid to construction. It is admissible only if the court finds the contract ambiguous. Lyon Development Co. v. Business Men's Assurance Company of America, 76 F.3d 1118 (10th Cir.1996).
The contract is a lease agreement for the operation of Hardee's restaurants at rest areas on the Kansas Turnpike. Substantial portions of the contract are devoted to matters such as the term of the lease, rental payments, food and prices, signs, insurance and termination of the lease. The provisions cited by plaintiff appear primarily in the section entitled Maintenance and Repairs. The overall thrust of this section concerns the physical condition of the property. While customers who use the restaurants arguably benefit from proper maintenance of the property, their status is not comparable, for example, to jail inmates whose care and control is the subject of a jail maintenance contract. Clearly, viewed in the context of the contract as a whole, restaurant customers such as plaintiff are incidental beneficiaries, at best.
Plaintiff's position basically ignores the contract as a whole and instead focuses upon isolated provisions and isolated words or phrases in those provisions. She then argues that these isolated portions make the contract ambiguous, not from the perspective of what the parties intended, but rather from what "reasonable minds" could view the words to mean. Her approach seems to be that she should be allowed to introduce extrinsic evidence regarding matters the parties should have considered (building design, adequacy of windows, visibility and natural surveillance) instead of what they did consider in drafting the contract. This does not demonstrate ambiguity.
Perhaps most important, plaintiff ignores her own point: that parties to a contract are presumed to know and have in mind existing law and draft the contract accordingly. The contract in question was made in 1982 when the law of Kansas was (and is) that a business owner's liability for an assault on a patron by a third party is limited in the manner stated in Seibert v. Regnier, supra. Plaintiff's entire case is predicated on the existence of contractual duties which exceed those required by law. It would be an illogical or absurd interpretation of the contract for the court to find that the parties intended to create contractual duties which substantially exceeded those required by existing Kansas law unless the contract specifically so states. To do so would amount to rewriting the contract to achieve an equitable result, something the court cannot and will not do.
Accordingly, the court finds as a matter of law that the contract is not ambiguous and *1520 that the parties did not intend to create safety or "security" obligations in favor of Hardee's patrons which exceeded those under existing Kansas law. Since plaintiff's third party beneficiary claim depends upon existence in the contract of such extraordinary obligations, her claim must fail.
In summary, defendants' motion to dismiss plaintiff's third party beneficiary claim is converted to a motion for summary judgment and is sustained. This ruling does not amount to a final order, however. Plaintiff is granted 10 days from the filing of this order to file the second amended complaint referred to in Magistrate Judge Reid's order and footnote 1, supra. If no such complaint is filed, the clerk shall enter final judgment for defendants.
A motion for reconsideration of this order is not encouraged. Any such motion shall not exceed 5 pages and shall strictly comply with D.Kan. Rule 7.3 and the standards enunciated by this court in Comeau v. Rupp, 810 F. Supp. 1172, 1174 (1992). The response to any motion for reconsideration shall not exceed 5 pages. No reply shall be filed.
IT IS SO ORDERED.
RECOMMENDATION AND REPORT
REID, United States Magistrate Judge.
Plaintiff filed her initial complaint in this case on February 2, 1995 (Doc. 1). Plaintiff's injuries, which are the subject of this lawsuit, occurred on February 5, 1993. The initial complaint alleges that defendants were negligent in failing to provide proper security, resulting in injury and damages to the plaintiff. In response, defendants filed a motion to dismiss on June 1, 1995, claiming that plaintiff's negligence claims were barred by a two year statute of limitations (K.S.A. 60-513) (Doc. 2-3). On June 6, 1995, plaintiff filed her first amended complaint (Doc. 4). The first amended complaint, for the first time, brings a claim as an intended third-party beneficiary of the contract between the defendants and the Kansas Turnpike Authority. Plaintiff now claims that the contract was breached because of defendant's failure to provide proper security. Plaintiff asserts that her amended complaint contains no cause of action for negligence and seeks recovery solely on a contract claim (Doc. 8).
In response, defendants filed a motion to dismiss the first amended complaint on June 28, 1995 (Doc. 9-10). Plaintiff responded on July 19, 1995 (Doc. 11). A reply brief was filed on August 2, 1995 (Doc. 12). These matters have been referred to this court for a report and recommendation pursuant to 28 U.S.C. § 636(b)(1)(B).
The issue raised by the second motion to dismiss is whether the first amended complaint brings a contractual or a tort claim. If it brings a contractual claim, it is not contested that the statute of limitations has not yet run on this claim (K.S.A. 60-511). However, if it brings a negligence claim, then it appears that the two year statute of limitations may have run on such a cause of action.
The nature of a claim, whether it sounds in tort or contract, is determined from the pleadings and from the real nature and substance of the facts therein alleged. Malone v. University of Kansas Medical Center, 220 Kan. 371, 374, 552 P.2d 885 (1976). The difference between a tort and a contract action is that a breach of contract is a failure of performance of a duty arising or imposed by agreement. A tort is a violation of a duty imposed by law. Clark v. Associates Commercial Corp., 149 F.R.D. 629, 636 (D.Kan. 1993).
When elements of both contract and tort are present, the key difference is whether the contract calls for a specific result. When the contract does not call for the specific result at issue, the action is more in the nature of a violation of a duty imposed by law instead of failure to perform a duty arising by reason of agreement. In such a case, the plaintiff's complaint is not that the defendant failed to perform the contract, but that the defendant failed to perform it with due care.
Id., (quoting Hunt v. KMG Main Hurdman, 17 Kan. App. 2d 418, 839 P.2d 45, syl. ¶ 4 (1992)). In Hunt, the court further noted that the court must itself decide from the facts pleaded whether the gist or gravamen of the cause of action is in tort or contract. The court then quoted language from Prosser, *1521 The Law of Torts, § 92, pp. 621-22 [4th ed. 1971], which states that when the claim is one for personal injury, the decision usually has been that the gravamen of the action is the misconduct and the damage, and that it is essentially one of tort, which the plaintiff cannot alter by their pleading. Hunt, 17 Kan.App.2d at 420-21, 839 P.2d 45.[1] The general rule is that a plaintiff will not be permitted to characterize a tort action as one in contract in order to avoid the bar of the statute of limitations or governmental immunity. Malone, 220 Kan. at 376, 552 P.2d 885.
In Kansas, the owner of a business is not the insurer of the safety of its patrons or customers. The owner ordinarily has no liability for injuries inflicted upon patrons or customers by the criminal acts of third parties in the business' parking lot, as the owner has no duty to provide security. Such a duty may arise, however, where circumstances exist from which the owner could reasonably foresee that its customers have a risk of peril above and beyond the ordinary and that appropriate security measures should be taken. Seibert v. Vic Regnier Builders, Inc., 253 Kan. 540, 548, 856 P.2d 1332 (1993).
It is therefore clear that there is a duty imposed by law for businesses to provide security in some circumstances. By contrast, a review of the contract between the KTA (Kansas Turnpike Authority) and Hardees makes absolutely no reference to security. The language of the contract relied on by plaintiff is the following:
Section 8, (d) General: Operator [Hardees] shall correct and remedy any and all unsatisfactory conditions inside or outside of the leased premises as they may relate to attractiveness, high quality of service, efficiency, cleanliness, safety, or sanitation, in a manner befitting the Turnpike and the facilities afforded. [p. 12 of contract]
Section 25 TERMINATION: ... or (e) The Operator does not maintain the properties and keep them in a clean and sightly condition and maintain the high standard of attractiveness, high quality of service, efficiency, cleanliness, safety and sanitation in a manner befitting the Turnpike and the facilities afforded as provided in Section 9.... (Note: Section 9 is entitled HOUSEKEEPING and makes no reference to security). [p. 23 of contract]
The contract in question in this case does not expressly address the issue of security. It does not specifically set forth any requirements for security. The gist or gravamen of plaintiff's action is that defendants failed to provide proper security. The complaint alleges that defendants specifically failed to allow for natural surveillance, had no security or electronic surveillance, and failed to conduct adequate research and crime analyses of the area to determine proper security measures. None of these complaints are expressly or specifically addressed in the contract; however, they clearly implicate the duty imposed by law as set forth in Seibert. In addition, this claim is one for personal injury. In such instances, the gravamen of those actions has generally been found to be one in tort. Finally, the court would note that plaintiff did not attempt to assert a contract claim until defendant sought to dismiss the tort action because of the statute of limitations. As the court noted above, plaintiff cannot attempt to characterize their action as a contract action in order to avoid the statute of limitations on a tort action. For these reasons, the court finds that the gist or gravamen of the cause of action is in tort, not contract. Therefore, the governing statute of limitations is K.S.A. 60-513(a)(4), which allows two years for a tort action to be brought. Hunt, 17 Kan.App.2d at 419, 839 P.2d 45.
The next issue for the court to address is whether the cause of action is barred by the statute of limitations. As previously noted, the plaintiff's injuries, which are the subject of this lawsuit, were incurred on February 5, 1993. She filed her lawsuit on February 2, 1995. K.S.A. 60-203(a) provides as follows:
A civil action is commenced at the time of: (1) Filing a petition with the clerk of the court, is service of process is obtained or the first publication is made for service by publication within 90 days after the petition is filed, except that the court may *1522 extend that time an additional 30 days upon a showing of good cause by the plaintiff;
It is not disputed that service of process was obtained on the defendant on May 19, 1995. Service was thus obtained 106 days after the filing of the lawsuit. Since service was obtained beyond the 90 days after the filing of the complaint, and a 30 day extension was not sought in this case, plaintiff's complaint was commenced after the statute of limitations had expired.
Plaintiff's response to the clear language of the Kansas statute is to argue that the Kansas statute allows 120 days for service when good cause exists, and that the requirement that the 30 day extension be sought before the initial 90 days expires is a procedural, not a substantive rule, and is therefore not binding on a federal court. Plaintiff takes the position that so long as plaintiff had good cause for the additional 30 days, it is not necessary to seek the 30 day extension prior to the expiration of the initial 90 days allowed under K.S.A. 60-203(a).
In the case of Read v. Miller, 247 Kan. 557, 564, 802 P.2d 528 (1990), the court held that an extension of time under K.S.A. 60-203(a) must be sought and granted before the expiration of the 90-day period. In deciding whether a state rule is substantive or procedural, federal courts are governed by the requirement that a federal court cannot give the cause of action a longer life in federal court than it would have had if the case had been filed in state court. Elliott v. White, O'Connor & Werner, P.A., 750 F. Supp. 451, 453 (D.Kan.1990). A plaintiff should not be allowed to proceed in federal court with a lawsuit which would be barred in state court. Saraniero v. Safeway Inc., 540 F. Supp. 749, 752 (D.Kan.1982). Therefore, to determine the commencement date of plaintiff's present cause of action, for the purposes of the statute of limitations defense, we must look to Kansas law. Elliott, 750 F.Supp. at 453. The requirement under state law that the 30 day extension be sought prior to the expiration of the 90 days is therefore applicable in federal court as well. Burnett v. Perry Manufacturing, Inc., 1994 WL 116323 at *4 n. XXXXXXXXX (D.Kan. March 15, 1994); Hollowell v. Bland, 1993 WL 58283 at *1 (D.Kan. Feb. 3, 1993); Clark v. Browning and Olin Corp., 1992 WL 24103 at *3 n. 2 (D.Kan. Jan. 29, 1992). Plaintiff's claim was therefore filed after the expiration of the statute of limitations.
The final argument that plaintiff asserts is that she is or was an incapacitated person. K.S.A. 60-515(a) provides that if a person is incapacitated when the cause of action accrued or at any time during the period the statute of limitations is running, that person is entitled to bring such action within one year after the person's disability has been removed. Based on this statute, plaintiff asserts that the cause of action has not run.
Under Kansas law, a party seeking to raise the tolling provisions provided by K.S.A. 60-515 must assert the facts justifying its application in their complaint. Where the injured party does not assert legal incapacity as a cause for delay in commencing an action in court, such injured party stands in the position of a person possessing the attributes of a person with legal capacity, when confronted with the two-year statute of limitations in a negligence action. Gardner v. Toyota Motor Sales, U.S.A., Inc., 793 F. Supp. 287, 289-90 (D.Kan.1992).
The first amended complaint does not allege that the plaintiff was incapacitated at any period after the injury in question. However, the affidavit of Dr. Eugene Reynolds, a clinical psychologist, states that the plaintiff is incapacitated. Therefore, the court will permit the plaintiff to file a second amended complaint, setting forth grounds for tolling the statute of limitations pursuant to K.S.A. 60-515(a). Such an amended complaint should be sufficient to toll the statute of limitations and permit the negligence action to go forward.[2]
IT IS THEREFORE RECOMMENDED that the motions to dismiss (Doc. 2, 9) be denied on the condition that plaintiff file a *1523 second amended complaint asserting incapacitation pursuant to K.S.A. 60-515(a). However, plaintiff will not be permitted to maintain a claim for breach of contract.
IT IS FURTHER ORDERED that plaintiff's request for oral argument (Doc. 14) is denied.
IT IS FURTHER ORDERED that plaintiff's motion to set a scheduling conference (Doc. 17-18) is denied without prejudice. Upon the ruling on the above recommendation by the district court judge, plaintiff's counsel may contact the court for the setting of a scheduling conference.
IT IS FURTHER ORDERED that the motion to stay (Doc. 15-16) is denied. See Wolf v. United States, 157 F.R.D. 494, 495 (D.Kan.1994).
Copies of this recommendation shall be mailed to counsel of record for the parties. Pursuant to 28 U.S.C. § 636(b)(1)(B), the parties may serve and file written objections to the recommendation within 10 days after being served with a copy of this recommendation.
NOTES
[1] The magistrate judge ruled that plaintiff could file a second amended complaint alleging plaintiff's incapacity and setting forth grounds for tolling the statute of limitations pursuant to K.S.A. 60-515(a). Plaintiff has not done so.
[2] The file does not reflect any attempt to serve defendant Imasco, Ltd.
[3] Plaintiff cites Flood v. Wisconsin Real Estate Inv. Trust, 503 F. Supp. 1157 (D.Kan.1980) (suit by tenant against landlord for breach of express and implied warranties of security); Noel v. Proud, 189 Kan. 6, 367 P.2d 61 (1961), (suit by a patient against his physician based upon breach of express warranty) and Malone v. University of Kansas Medical Center, 220 Kan. 371, 552 P.2d 885 (1976) (suit by a patient against hospital based upon breach of express contract). But none of these cases mention the concept of third-party beneficiary and are not helpful.
Plaintiff also cites cases from other jurisdictions: Owens v. Haas, 601 F.2d 1242, 1250 (2nd Cir.1979) (tentative finding, based upon language of contract between U.S. Bureau of Prisons and state jail, that prisoner's complaint stated third-party beneficiary status sufficient to survive motion to dismiss); Cherry v. Crow, 845 F. Supp. 1520, 1523 (M.D.Fla.1994) (based on language of contract between sheriff and health care provider, claim for wrongful death of prisoner allegedly denied medical care stated third-party beneficiary status sufficient to survive motion to dismiss); Stickle v. City-Wide Security Services, Inc., 839 F. Supp. 207, 210 (S.D.N.Y. 1993) (based on language of security services contract, building tenant deemed a third-party beneficiary for purposes of surviving motion for summary judgment); Nieswand v. Cornell University, 692 F. Supp. 1464, 1470 (N.D.N.Y.1988) (factual questions surrounding claims of express and implied contract between student and university sufficient to survive summary judgment; third-party beneficiary not discussed); Vick v. H.S.I. Management, Inc., 507 So. 2d 433 (Alab.1987) (tenant's negligence claim against company which had contracted with apartment owner to maintain outdoor lighting sufficient to survive motion for summary judgment; no specific discussion of third-party beneficiary) and Holley v. St. Paul Fire & Marine Ins. Co., 396 So. 2d 75 (Ala.1981) (hospital visitor may be third-party beneficiary of maintenance contract).
The court has read and considered these cases. The court declines to discuss the cases in detail but rather simply observes that the cases are factually distinguishable and, in any event, nonbinding precedent. The court is satisfied that sufficient Tenth Circuit and Kansas law supports its decision.
[1] The language from Prosser was previously quoted in Tamarac Development Co., Inc. v. Delamater, Freund & Associates, P.A., 234 Kan. 618, 619, 675 P.2d 361 (1984).
[2] In considering a motion to dismiss for failure to state a claim, the court should assume all facts alleged in the complaint are true and should indulge all reasonable inferences in favor of the plaintiffs. Weatherhead v. Globe International, Inc., 832 F.2d 1226, 1228 (10th Cir.1987). "[A] complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S. Ct. 99, 102, 2 L. Ed. 2d 80 (1957); see Monument Builders of Greater Kansas City, Inc. v. American Cemetery Assn. of Kansas, 891 F.2d 1473, 1480 (10th Cir.1989), cert. denied, 495 U.S. 930, 110 S. Ct. 2168, 109 L. Ed. 2d 498 (1990); Weatherhead v. Globe International, Inc., 832 F.2d at 1228. The court cannot dismiss a complaint merely because it doubts that the plaintiff can prove the facts it alleges. Thus, a motion to dismiss can only be granted if plaintiff has failed to allege sufficient facts to entitle it to relief if the facts alleged are taken as true. Mundell v. Beverly Enterprises-Indiana, Inc., 778 F. Supp. 459, 460 (S.D.Ind.1991). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581035/ | 42 So. 3d 132 (2010)
Robert L. HARRISON
v.
STATE DEPARTMENT OF INDUSTRIAL RELATIONS.
2080886.
Court of Civil Appeals of Alabama.
January 22, 2010.
Robert L. Harrison, pro se.
Frank D. Marsh, gen. counsel, and Shirley Z. Brown, deputy gen. counsel, Alabama Department of Industrial Relations, for appellee.
PER CURIAM.
Robert L. Harrison appeals from a summary judgment in favor of the State Department of Industrial Relations ("DIR"). The summary judgment was based upon Harrison's failure to timely file an appeal of DIR's determination that he was ineligible to receive unemployment-compensation benefits.
The record indicates the following. Harrison, who has appeared pro se throughout these proceedings, filed a claim with DIR for unemployment-compensation benefits on February 24, 2008. On March 20, 2008, DIR mailed Harrison a "Notice of Determination" ("the notice") denying *133 Harrison's claim. The notice consists of a completed preprinted form, known as a Form BEN-11, and includes instructions on how to appeal from an adverse ruling. The instructions state that an appeal must be filed within 15 calendar days from the date the notice is mailed to the claimant. In this case, the notice was mailed by first-class mail, postage prepaid, to Harrison's last known address, and it was not returned to DIR as undeliverable. Harrison claimed he did not receive the notice.
On December 9, 2008, more than eight months after the notice had been mailed, Harrison attempted to appeal from the denial of his claim. On December 11, 2008, DIR sent Harrison a notice that his appeal was deemed late, but DIR granted a hearing on the issue of the timeliness of his appeal. The hearing was held on February 24, 2009, after which the administrative hearing officer who heard the appeal issued a decision that Harrison's appeal was untimely. On February 26, 2009, that decision was mailed to Harrison at the same address as the other notices.
Harrison timely appealed the hearing officer's decision to the DIR Board of Appeals. The Board of Appeals "disallowed" Harrison's appeal. Harrison then timely filed an appeal with the Jefferson Circuit Court. DIR moved for a summary judgment on the ground that Harrison had failed to timely appeal the March 2008 determination denying his claim. After a hearing on the motion, the trial court entered a summary judgment in favor of DIR. Harrison timely appealed to this court.
"We review a summary judgment de novo. American Liberty Ins. Co. v. AmSouth Bank, 825 So. 2d 786 (Ala. 2002).
"`We apply the same standard of review the trial court used in determining whether the evidence presented to the trial court created a genuine issue of material fact. Once a party moving for a summary judgment establishes that no genuine issue of material fact exists, the burden shifts to the nonmovant to present substantial evidence creating a genuine issue of material fact. "Substantial evidence" is "evidence of such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved." In reviewing a summary judgment, we view the evidence in the light most favorable to the nonmovant and entertain such reasonable inferences as the jury would have been free to draw.'
"Nationwide Prop. & Cas. Ins. Co. [v. DPF Architects, P.C.], 792 So.2d [369] at 372 [(Ala.2001)] (citations omitted), quoted in American Liberty Ins. Co., 825 So.2d at 790."
Potter v. First Real Estate Co., 844 So. 2d 540, 545 (Ala.2002).
The only issue Harrison raises on appeal is whether DIR violated § 41-22-16(d), Ala.Code 1975, of the Alabama Administrative Procedure Act ("the AAPA"), § 41-22-1 et seq., Ala.Code 1975, by sending the initial notice of the denial of his claim for benefits by first-class mail rather than by certified mail. Section 41-22-16(d) provides as follows:
"(d) Parties shall be notified either personally or by certified mail return receipt requested of any order and, unless waived, a copy of the final order shall be so delivered or mailed to each party or to his attorney of record. Provided, however, that, except as hereinafter provided, notification of any order other than a final decision or order subject to judicial review may, where permitted by existing statute, be delivered by first class mail, postage prepaid, *134 and delivery shall be effective upon deposit of the notice and, unless waived, the final order in the mail; provided, the notification of the final order subject to judicial review, together with a copy of the final order, shall be delivered either by personal service as in civil actions or by certified mail, return receipt requested."
(Emphasis added.)
The issue whether the notice of determination, i.e., the completed DIR Form BEN-11, was a "final decision or order subject to judicial review" was not explicitly raised before the trial court. However, Harrison did argue in the trial court that DIR was required to send the notice to him by certified mail, return receipt requested, and that it violated the requirements of the AAPA when it mailed the notice by first-class mail. Therefore, implicit in the trial court's judgment is a determination that the notice at issue was not a "final decision or order subject to judicial review" required to be sent by certified mail.
In his argument that the notice had to be mailed to him by certified mail, Harrison ignores earlier provisions in § 41-22-16 that describe final orders that must be sent to the parties by certified mail. Those provisions provide as follows:
"(a) The final order in a proceeding which affects substantial interests shall be in writing and made a part of the record and include findings of fact and conclusions of law separately stated, and it shall be rendered within 30 days:
"(1) After the hearing is concluded, if conducted by the agency;
"(2) After a recommended order, or findings and conclusions are submitted to the agency and mailed to all parties, if the hearing is conducted by a hearing officer; or
"(3) After the agency has received the written and oral material it has authorized to be submitted, if there has been no hearing. The 30 day period may be waived or extended with the consent of all parties and may be extended by law with reference to specific agencies.
"(b) Findings of fact, if set forth in a manner which is no more than mere tracking of the statutory language, shall be accompanied by a concise and explicit statement of the underlying facts of record which support the findings. If, in accordance with agency rules, a party submitted proposed findings of fact or filed any written application or other request in connection with the proceeding, the order shall include a ruling upon each proposed finding and a brief statement of the grounds for denying the application or request."
§ 41-22-16, Ala.Code 1975 (emphasis added).
The initial notice sent to Harrison informing him that DIR had denied his claim was not a "final order" that resulted from a proceeding. At the point the notice was mailed to Harrison, nothing had yet been contested; there was no arbiter considering the assertions of each party who could have issued a final order. As § 41-22-16(d) provides, notices other than final decisions or orders may be sent first-class mail.
Furthermore, the March 20, 2008, decision was not a "final decision or order subject to judicial review" so as to mandate notice by certified mail under Ala. Code 1975, § 41-22-16(d) (emphasis added). Alabama's unemployment law provides that "[n]o circuit court shall permit an appeal from a decision allowing or disallowing a claim for [unemployment] benefits unless the decision sought to be reviewed is that of an appeals tribunal or of *135 the board of appeals and unless the person filing such appeal has exhausted his administrative remedies ...." § 25-4-95, Ala.Code 1975 (emphasis added). Further, § 25-4-91(c)(1), Ala.Code 1975, requires merely that notice of decisions on unemployment claims be "promptly given to the claimant and the claimant's last employing unit by delivery thereof or mailing such notices to their last known addresses" (emphasis added). Service authorized by mail is completed upon mailing, not upon receipt. See Elliott v. Board of Equalization & Adjustment of Jefferson County, 469 So. 2d 602, 604 (Ala.Civ.App. 1984); McCoy v. Bureau of Unemployment Compensation, 81 Ohio App. 158, 161-62, 77 N.E.2d 76, 78 (1947).
DIR did not violate the AAPA by sending the initial notice of determination to Harrison by first-class mail. Harrison failed to timely appeal from that notice. Accordingly, the trial court's summary judgment in favor of DIR is due to be affirmed.
AFFIRMED.
THOMPSON, P.J., and PITTMAN and THOMAS, JJ., concur.
MOORE, J., dissents, with writing, which BRYAN, J., joins.
MOORE, Judge, dissenting.
I respectfully dissent from the majority's decision to affirm the circuit court's judgment.
The record in this case reveals that Robert L. Harrison filed a claim for unemployment-compensation benefits on February 24, 2008. On March 20, 2008, the State Department of Industrial Relations ("DIR") mailed Harrison a "Notice of Determination" denying Harrison's claim ("the denial notice"). The denial notice includes instructions on how to appeal the determination denying Harrison's claim; those instructions state that an appeal must be filed within 15 calendar days from the date the notice is mailed. DIR presented evidence indicating that the denial notice was mailed to Harrison's last-known address, postage prepaid, and that the denial notice was not returned as undeliverable. Harrison asserted, however, that he did not receive the denial notice.
On December 9, 2008, Harrison filed with DIR an appeal from the denial of his claim. DIR mailed a notice to Harrison on December 11, 2008, informing him that his appeal was deemed to have been filed late; that notice afforded Harrison appeal rights on only the issue of the timeliness of his appeal. A hearing was held on February 24, 2009, after which the administrative hearing officer who heard the appeal issued a decision affirming that Harrison's appeal was untimely. That decision was mailed to Harrison on February 26, 2009. Harrison appealed the decision of the administrative hearing officer to the DIR Board of Appeals. The Board of Appeals denied his application for leave to appeal the administrative hearing officer's decision. Harrison filed an appeal to the Jefferson Circuit Court.
DIR filed a motion for a summary judgment based on the untimeliness of Harrison's initial appeal from the denial notice. Harrison filed a motion for a summary judgment, asserting that DIR had failed to comply with § 41-22-16(d), Ala.Code 1975, a part of the Alabama Administrative Procedure Act ("the AAPA"), § 41-22-1 et seq., Ala.Code 1975, by failing to send the denial notice by certified mail. After a hearing, the circuit court entered a summary judgment in favor of DIR. Harrison filed a motion to alter, amend, or vacate that judgment on June 23, 2009; that motion was denied on June 29, 2009. Harrison timely appealed to this court.
*136 On appeal, Harrison argues that DIR violated § 41-22-16(d) by failing to send the denial notice by certified mail. Section 41-22-16(d) provides:
"Parties shall be notified either personally or by certified mail return receipt requested of any order and, unless waived, a copy of the final order shall be so delivered or mailed to each party or to his attorney of record. Provided, however, that, except as hereinafter provided, notification of any order other than a final decision or order subject to judicial review may, where permitted by existing statute, be delivered by first class mail, postage prepaid, and delivery shall be effective upon deposit of the notice and, unless waived, the final order in the mail; provided, the notification of the final order subject to judicial review, together with a copy of the final order, shall be delivered either by personal service as in civil actions or by certified mail, return receipt requested."
Harrison argues that because the denial notice indicated that the decision to deny him unemployment-compensation benefits became final in 15 days, it is a final decision or order within the purview of § 41-22-16(d) and, thus, was required to be delivered by certified mail, return receipt requested.
Section 41-22-16(d) requires that parties shall be notified either personally or by certified mail "of any order" and that "notification of any order other than a final decision or order subject to judicial review" may be delivered by first-class mail, postage prepaid. (Emphasis added.) The majority relies on the earlier provisions in § 41-22-16, which describe final orders that must be sent to the parties by certified mail, and determines that the denial notice "was not a `final order' that resulted from a proceeding," 42 So.3d at 134, and, thus, that the denial notice was exempt from the requirement that Harrison be notified either personally or by certified mail. The main opinion determines that the denial notice did not amount to a "final order" and, thus, that delivery of the denial notice was not required to be made via certified mail; I do not agree, however, that that is the end of our inquiry. "The general rule is that where the language of a statute is unambiguous, the clearly expressed intent must be given effect, and there is no room for construction." Alabama Indus. Bank v. State ex rel. Avinger, 286 Ala. 59, 62, 237 So. 2d 108, 111 (1970). Because the legislature chose to include both final decisions and final orders in the language of § 41-22-16(d), I believe a determination whether the denial notice in the present case amounts to a final decision is also warranted.
The purpose of Alabama's Unemployment Compensation Act, § 25-4-1 et seq., Ala.Code 1975, is "`beneficent,'" and the act "`should be construed liberally to effectuate its purpose.'" Reynolds Metals Co. v. State Dep't of Indus. Relations, 792 So. 2d 419, 422 (Ala.Civ.App.2000) (quoting Ex parte Doty, 564 So. 2d 443, 446 (Ala. 1989)). Section 25-4-91, Ala.Code 1975, addresses determinations of claims for unemployment-compensation benefits. Section 25-4-91(d)(1) provides:
"Unless any party to whom notice of determination is required to be given shall, within seven calendar days after delivery of such notice or within 15 calendar days after such notice was mailed to his last known address, file an appeal from such decision, such decision shall be deemed final."
(Emphasis added.) Thus, DIR's decision to deny Harrison unemployment-compensation benefits was a final decision.
The main opinion implies that DIR's decision to deny Harrison unemployment-compensation *137 benefits was not "subject to judicial review" because, at the time that decision was rendered, Harrison had not exhausted his administrative remedies. I disagree. The question raised by the main opinion's discussion is whether the phrase "subject to judicial review" requires that the matter is immediately ripe for review, as the main opinion clearly contends, or whether the matter must only ultimately be subject to review by a court of law, which I maintain is the correct interpretation.
I have located no cases in Alabama or any other state that define the phrase "subject to judicial review." However, there are a number of Alabama cases discussing matters that are not subject to judicial review. See Birmingham-Jefferson Civic Ctr. Auth. v. City of Birmingham, 912 So. 2d 204, 215-16 (Ala.2005) (discussing political questions barred from judicial resolution); Ex parte Houston County Bd. of Educ., 562 So. 2d 513, 514-15 (Ala.1990) (circuit court was without jurisdiction to review a determination of the Alabama Board of Adjustment regarding the State's liability because decisions by the Board of Adjustment are not subject to judicial review); Barber v. Covington County Comm'n, 466 So. 2d 945 (Ala. 1985) (county commission's exercise of discretionary powers is not subject to judicial review except for fraud, corruption, or unfair dealing); State Dep't of Revenue v. Teague, 441 So. 2d 914, 916 (Ala.Civ.App. 1983) (classifications for taxation are not subject to judicial review unless arbitrary, oppressive, and capricious on their face); Byars v. Baptist Med. Ctrs., Inc., 361 So. 2d 350, 354 (Ala.1978) (refusal of the board of directors of a private corporation to appoint a particular physician to the medical staff of a hospital is not subject to judicial review); and Mustell v. Rose, 282 Ala. 358, 362-63, 211 So. 2d 489, 493 (1968) (the management of a school's internal affairs is not a matter for judicial review unless school authorities have acted arbitrarily, capriciously, maliciously, or in bad faith).
One definition of "subject" is "contingent on or under the influence of some later action." Merriam-Webster's Collegiate Dictionary 1243 (11th ed.2003).[1] "Judicial review," in turn, is defined as a "court's power to review the actions of other branches or levels of government" or a "court's review of a lower court's or an administrative body's factual or legal findings." Black's Law Dictionary 864 (8th ed.2004). In Hancock v. Commissioner of Education, 443 Mass. 428, 435, 822 N.E.2d 1134, 1140 (2005), the Supreme Judicial Court of Massachusetts discussed whether a case previously decided by that court had properly determined that a statute regarding education imposed an enforceable duty on the legislature. That court stated that some justices had posited that that case "impermissibly broadened the meaning of the education clause by imposing on the Commonwealth an enforceable obligationthat is, a duty subject to judicial review." 443 Mass. at 435 n. 4, 822 N.E.2d at 1140 n. 4. (emphasis added). Thus, Hancock indicates that a duty imposed on the legislature by a statute is subject to judicial review if it is one that can be enforced by a court. Consequently, a decision is subject to judicial review if it can be enforced or overturned by a court.
In the present case, DIR's decision to deny Harrison unemployment-compensation *138 benefits was a decision that could later be affirmed or reversed by the action of a court of law. Consistent with the definitions of "subject" and "judicial review," I conclude that § 41-22-16(d) contemplates that a decision subject to judicial review is one that is ultimately enforceable or susceptible to being overturned by a court.
Because, in my opinion, the language in § 41-22-16(d) is unambiguous and necessarily includes both "final decisions" and "final orders," and because the denial notice is a "final decision" that is "subject to judicial review" as stated in § 25-4-91(d)(1), I conclude that § 41-22-16(d) contemplates that final decisions to deny unemployment-compensation benefits should be delivered personally or by certified mail. Thus, I would reverse the circuit court's judgment and remand the case to the circuit court for that court to remand the case to DIR for further proceedings.
BRYAN, J., concurs.
NOTES
[1] Other definitions of "subject," when being used as an adjective, include "owing obedience or allegiance to the power or dominion of another" and "suffering a particular liability or exposure" or "having a tendency or inclination." Merriam-Webster's Collegiate Dictionary 1243 (11th ed.2003). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581046/ | 42 So. 3d 315 (2010)
Cederic Lovell ARMSTRONG, Appellant,
v.
STATE of Florida, Appellee.
No. 2D09-1033.
District Court of Appeal of Florida, Second District.
August 11, 2010.
*316 James Marion Moorman, Public Defender, and Cynthia J. Dodge, Assistant Public Defender, Bartow, for Appellant.
Bill McCollum, Attorney General, Tallahassee, and Donna S. Koch, Assistant Attorney General, Tampa, for Appellee.
CASANUEVA, Chief Judge.
Cederic Lovell Armstrong appeals his conviction and sentence for fraudulent use of a credit card.[1] Because the trial court erred in failing to exclude unauthenticated business records upon timely and proper defense objection, we reverse for a new trial.
The fraudulently used credit card belonged to Dana Lewis. She testified that on the day after Labor Day 2007, she received a telephone call from her bank alerting her to unusual activity in her home equity credit line account. The account could be accessed by use of her credit card and its PIN,[2] which she kept together in a shoebox located in a closet in her home. Armstrong had visited with Lewis at her home during the Labor Day weekend and had had access to the room where she kept the shoebox. Later, she confronted Armstrong about the charges that she had not incurred, and he responded by saying, "I have a disease."
During Lewis' testimony at trial, the State offered as evidence printouts of her account transactions for the relevant time period. Lewis had downloaded and printed this evidence of the transactions in her account from her bank's website. The State sought to present these transactions to her for identification and to establish which were unauthorized. Armstrong's defense counsel objected on hearsay grounds because the State had not produced a records custodian to testify to the authenticity of these records as required by section 90.803(6)(a), Florida Statutes (2007), nor had the State provided an affidavit *317 to self-authenticate them as permitted by section 90.902(11). The trial court overruled the hearsay objection and allowed the printouts into evidence. The State presented no other evidence of the unauthorized transactions for which amounts the bank had reimbursed Lewis. The jury convicted Armstrong as charged. The trial court sentenced him to ten years' incarceration as a habitual offender and ordered restitution to the bank for the amount of the unauthorized withdrawals.
Armstrong now contends that his conviction must be reversed because this erroneously admitted hearsay evidence was the sole basis for the State's case against him. To support this contention he cites Medlock v. State, 537 So. 2d 1030 (Fla. 2d DCA 1988). In Medlock, the defendant was convicted of grand theft for taking money from an ATM by using her roommate's bank money card. This court reversed for a new trial, saying, "Since the state relied upon [the victim's] bank statement as the primary, if not the sole, evidence of the theft, we find the admission of the statement to be reversible error." Id. at 1031. We agree with Armstrong's argument because Medlock is factually and legally indistinguishable and thus is controlling precedent. The bank statement used there is the same kind of hearsay as the downloaded and printed-out evidence used against Armstrong here. And Lewis' testimony relied solely on the hearsay in this unauthenticated printout. In Medlock, the State failed to establish that the evidence was a business records exception to the hearsay rule, yet the trial court admitted the evidence without such proper authentication. In doing so it erred. 537 So.2d at 1031; see also N.S. v. State, 988 So. 2d 1153 (Fla. 3d DCA 2008) (finding similar error but holding it harmless because other evidence supported the conviction, thus distinguishing Medlock). For the same reason, the trial court here also erred.
Reversed and remanded for a new trial. See Quick v. State, 450 So. 2d 880, 881 (Fla. 4th DCA 1984).
SILBERMAN and LaROSE, JJ., Concur.
NOTES
[1] § 817.61, Fla. Stat. (2007).
[2] A "PIN" is the "personal identification number" which must be used in conjunction with the credit card to obtain money from an ATM machine, similar to a signature if the card is used in person for a purchase. Armstrong also contends in this appeal that he could not be convicted of fraudulent use of a credit card because use of Lewis' PIN is not tantamount to representing himself as the cardholder, an element that section 817.61 requires under a plain reading of the statute. We find no merit to this argument. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581072/ | 42 So. 3d 618 (2010)
J.M., a minor, by and through V.M., as her Natural Mother and V.M., Individually, Appellants
v.
Stephen BAILEY, in his Official and Individual Capacities, Dr. Percy Washington, in his Official and Individual Capacities, Holmes County School District and Harold Epps, Appellees.
No. 2009-CA-00893-COA.
Court of Appeals of Mississippi.
August 3, 2010.
*619 Carlos Eugene Moore, Juan Tyrece Williams, Grenada, attorneys for appellants.
Neysha Larose Sanders, Greenwood, Roy A. Smith Jr., Shelly G. Burns, Sandra Denise Buchanan, Jackson, attorneys for appellees.
EN BANC.
KING, C.J., for the Court:
¶ 1. J.M., a minor child, by and through her mother, V.M., filed suit against the Holmes County School District (school district) and several school district officials, alleging various claims that include failure to report sexual abuse, negligent hiring, and intentional infliction of emotional distress. The Holmes County Circuit Court granted summary judgment in favor of the school district and its officials. Aggrieved, J.M. appeals, raising two issues:
I. Whether the trial court erred by finding that the school district sufficiently reported the alleged abuse pursuant to Mississippi Code Annotated section 97-5-24 (Rev.2006), and
II. Whether the trial court erred by finding that the school district sufficiently reported the alleged abuse pursuant to Mississippi Code Annotated section 43-21-353 (Rev.2009).
Finding no error, we affirm.
FACTS AND PROCEDURAL HISTORY
¶ 2. On January 15, 2007, J.M. participated in a parade as a member of her high school band.[1] On the return trip home, Harold Epps, a high school employee and an adult chaperone, sat on the bus seat next to J.M.
¶ 3. On January 17, 2007, V.M., J.M.'s mother, contacted the Holmes County Sheriff's Department and alleged that Epps had sexually abused her daughter during the bus ride. V.M. also took J.M. to the hospital for an examination. Hospital officials instructed V.M. to contact the Mississippi Department of Human Services (DHS) to report her claim. V.M. reported the incident to DHS, and DHS referred the case to local law enforcement. A copy of DHS's "Law Enforcement Referral" form was presented to the trial court. The form detailed that the case was reported on January 17, 2007, and it included the names of the parties involved and a description of the complaint.
¶ 4. Later that afternoon, V.M. reported the incident to Dr. Percy Washington, J.M.'s high school principal. After learning about the incident, Dr. Washington contacted the sheriff's department and DHS. Both confirmed that V.M. previously *620 had filed a report. Dr. Washington also questioned other chaperones, band members, and the band director. No one noticed anything unusual on the bus, and no wrongdoing was reported to the chaperones or the band director.
¶ 5. Powell Rucker, the school district's assistant superintendent, followed up on the matter. In an electronically signed memo dated January 18, 2007, Rucker informed Stephen Bailey, the superintendent, that Dr. Washington had contacted both DHS and the sheriff's department regarding the incident. In a more detailed letter dated January 22, 2007, Dr. Washington relayed the results of his investigation to Rucker and informed him that the police were investigating the incident as well. Subsequently, Epps was arrested and indicted for sexual assault.
¶ 6. On July 10, 2007, J.M. filed a complaint in the Circuit Court of Holmes County against the school district, Bailey, Dr. Washington, and Epps (hereinafter collectively referred to as the school district). In the original complaint, J.M. (1) requested an injunction prohibiting future conduct of a similar nature; (2) alleged that the school district had violated state and federal law and was negligent in hiring, monitoring, training, and supervising Epps, Bailey, and Dr. Washington; (3) argued that the defendants were negligent per se by failing to report immediately the abuse to DHS; (4) alleged intentional or negligent infliction of emotional distress; (5) alleged civil assault and battery; and (6) argued premises liability. The case was removed to federal court. Thereafter, J.M. filed an amended complaint, removing her federal-law claims from the complaint, and the case was remanded to state court.
¶ 7. Pursuant to an agreed order, defendants Bailey and Dr. Washington were dismissed in their individual capacities. On December 9, 2008, the school district filed a motion to dismiss or, in the alternative, a motion for summary judgment pursuant to the Mississippi Tort Claims Act. In response, J.M. filed a rebuttal brief in which she alleged for the first time that the school district failed to notify the district attorney about the alleged abuse pursuant to Mississippi Code Annotated section 97-5-24. The school district protested the addition of this new claim. On February 27, 2009, the trial court granted the motion in part and denied the motion in part. The trial court found that the school district was immune from liability and dismissed with prejudice all issues except for the claim of negligence per se for failure to report.
¶ 8. The school district filed a motion to reconsider on March 9, 2009, asking the trial court to reconsider its decision regarding the failure to a report claim. The trial court granted the motion to reconsider. After reviewing the pleadings, motions, exhibits, and oral argument, the trial court found that the school district had investigated the allegations of abuse and sufficiently reported the allegations to DHS. The trial court also found that the school district had reported the alleged abuse to the sheriff's department, which the trial court stated was the same as reporting it to the district attorney. On April 27, 2009, finding that no genuine issue of material fact existed regarding the claim, the trial court granted the motion for summary judgment and dismissed the remaining issue with prejudice. Aggrieved, J.M. timely filed her notice of appeal.
ANALYSIS
¶ 9. The trial court's grant or denial of summary judgment is reviewed under a de novo standard of review. One South, Inc. v. Hollowell, 963 So. 2d 1156, 1160 (¶ 6) (Miss.2007). "[S]ummary judgment is appropriate *621 where `the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'" Id. (quoting M.R.C.P. 56(c)). We view the evidence in the light most favorable to the nonmoving party, and the moving party bears the burden of showing that no genuine issue of material fact exists. Id.
¶ 10. It is important to note that J.M. claims that the school district violated two reporting statutesMississippi Code Annotated section 43-21-353 (Rev.2009) and section 97-5-24 (Rev.2006), which will be discussed in greater detail below. However, J.M. failed to raise a claim under section 97-5-24 in her complaint below.
¶ 11. Similarly, in Doe ex rel. Brown v. Pontotoc County School District, 957 So. 2d 410, 419 (¶ 24) (Miss.Ct.App.2007), the appellant failed to plead any duty to report claim in the complaint. The claim was raised for the first time at trial. Id. On appeal, this Court was not convinced that the issue was properly preserved for appeal. Id. However, the Court addressed the reporting duty under each statute section 97-5-24 and section 43-21-353. Id. at 419-22 (¶¶ 24-30). This Court found that the statutory reporting duty under section 43-21-353 was more general while the reporting duty under section 97-5-24 was more specific. Id. at 419-20 (¶ 24). Based on the rules of statutory construction, this Court found that the more specific statutesection 97-5-24controls in determining whether the defendant met its statutory duty. Id. We find that a determination of whether J.M.'s claim is barred from review would be futile and, thus, proceed to address her argument in accordance with Doe.
I. Mississippi Code Annotated section 97-5-24
¶ 12. J.M. argues that the trial court erred by determining that the school district sufficiently complied with section 97-5-24 by contacting the sheriff's department, because the statute specifically states that the school district should contact the district attorney under these circumstances. Conversely, the school district argues that J.M. is procedurally barred from raising this argument because it was not raised in either her original complaint or her amended complaint. Alternatively, the school district argues that it sufficiently complied with the statute by contacting the sheriff's department after learning about the alleged abuse.
¶ 13. Section 97-5-24 provides that:
If any person eighteen (18) years or older who is employed by any public or private school district in this state is accused of fondling or having any type of sexual involvement with any child under the age of eighteen (18) years who is enrolled in such school, the principal of such school and the superintendent of such school district shall timely notify the district attorney with jurisdiction where the school is located of such accusation, provided that such accusation is reported to the principal and to the school superintendent and that there is a reasonable basis to believe that such accusation is true.
There is little case law regarding section 97-5-24. However, there are similar statutes upon which we base our analysis. The purpose of such statutes is to eliminate the abuse of children and to prompt swift investigations into allegations of abuse. See Howe v. Andereck, 882 So. 2d 240, 243-44 (¶ 9) (Miss.Ct.App.2004). "The duty to report suspected child abuse attaches to an individual the moment they *622 are presented with a situation producing `reasonable cause' for such suspicion." Id. at 244 (¶ 10). Thus, pursuant to section 97-5-24, "the accusation of specific inappropriate behavior by an employee or a school district will only be reported to the district attorney if an accusation is first reported to the principal and superintendent and there is a `reasonable basis to believe' [that] the accusation is true." Doe, 957 So.2d at 420 (¶ 25) (quoting Miss. Code Ann. § 97-5-24 (Rev.2006)).
¶ 14. J.M. argues that the trial court erred by not making a determination of reasonableness regarding whether there was a need for the school district to report the alleged sexual abuse to the district attorney. J.M. takes issue with a statement made by Rucker in his deposition. When asked whether or not the incident was reported to the district attorney, Rucker stated that based on the sheriff's department's investigation, there was no reasonable cause to report the incident to the district attorney. The trial court did not directly rule on the issue of reasonableness. However, during the hearing on the motion to reconsider, the trial court found that "[s]ection 97-5-24 was satisfied in that [the school district] contacted the Holmes County Sheriff's Department, the law enforcement, which basically is the same as contacting the district attorney's office. And the purpose for all these contacts is for investigation."
¶ 15. Based on our review of the record, the evidence shows that V.M. contacted the hospital, DHS, and the sheriff's department before she reported the incident to school officials. The incident was not first reported to the principal or the superintendent. The school district was unaware that any alleged misconduct had occurred prior to V.M.'s contact with Dr. Washington. Because V.M. had contacted all of the proper authorities before she reported the incident to school officials, no duty to report actually arose on behalf of the school district. In an exercise of caution, the school district contacted DHS and the sheriff's department. DHS officials and the sheriff's department informed the school district that the incident had already been reported. There was nothing else for the school district to do in regard to its reporting duty.
¶ 16. J.M. maintains that the trial court erred by finding that contacting the sheriff's department was the same as contacting the district attorney. J.M. claims that the statute should be strictly construed. It has long been recognized that "[t]he sheriff is the chief law enforcement officer of the county[,] and it is the duty of him and his deputies to assist the district attorney, the main prosecutor for the State." Smith v. State, 251 Miss. 241, 243, 169 So. 2d 451, 452 (1964). As previously mentioned, the purpose of the statute is to eliminate the abuse of children and to encourage swift investigations into allegations of a student's sexual abuse by a school employee. See Howe, 882 So.2d at 243-44 (¶ 9). The record reveals that a prompt investigation of the matter ensued. In fact, Epps was subsequently indicted by the Holmes County grand jury for sexual battery. Although the school district did not directly contact the district attorney's office regarding the alleged abuse, it is clear that the information was relayed to the district attorney's office, which satisfies the purpose of the statute.
¶ 17. J.M. also argues that the trial court erred by relying upon an unsigned letter sent from Rucker to Bailey stating that Dr. Washington had contacted DHS and the sheriff's department. The record reveals that the letter did in fact bear an electronic signature. Nevertheless, we find that whether or not the letter was signed is of no consequence. The trial *623 court had plenty of other evidence to consider, such as Dr. Washington's and Rucker's depositions. Viewing the evidence in the light most favorable to J.M., there was nothing presented to suggest that the statements made by Dr. Washington and Rucker were untrue. Based on the foregoing, we find that the trial court did not err by finding that: no genuine issue of material fact existed; the school district complied with section 97-5-24; and the school district was entitled to a judgment as a matter of law. This issue is without merit.
II. Mississippi Code Annotated section 43-21-353
¶ 18. As previously mentioned, we find that section 97-5-24 controls whether the school district met its reporting duty. Despite this, it is clear that the school district also met any duty to report pursuant to section 43-21-353.
¶ 19. Section 43-21-353 basically identifies those persons who are under a duty to report child abuse, which includes school employees. The statute provides that persons under a duty to report child abuse, who have reasonable cause to suspect child abuse, must first report their suspicion to DHS in an oral report and follow up thereafter with a written report. Miss.Code Ann. § 43-21-353(1). The statute further provides the order of reporting between the agenciesDHS, local law enforcement, and the district attorney's office. See id. DHS is required to provide local law enforcement and the district attorney's office with information from its investigation. Id.
¶ 20. J.M. argues that, although the school district made an oral report to DHS by telephone, the school district should have followed up with DHS in writing. As previously stated, the school district had no reason to believe that J.M. was sexually assaulted by Epps until V.M. reported the matter to Dr. Washington. Before reporting the matter to Dr. Washington, V.M. had already contacted the proper authorities, including DHS. In an exercise of caution, the school district contacted DHS and was informed that the matter had already been reported. A copy of DHS's "Law Enforcement Referral" sheet was presented to the trial court. The form detailed that the case was reported on January 17, 2007. Pursuant to the statute, the form does not state who reported the claim. See Miss.Code Ann. § 43-21-353(4). The form included the names of the parties involved and a description of the complaint. Thus, there was nothing else for the school district to do in regard to its reporting duty.
¶ 21. Based on the foregoing, we find that the school district satisfied its burden. Thus, the trial court did not err by granting summary judgment in favor of the school district. This issue is without merit.
¶ 22. THE JUDGMENT OF THE CIRCUIT COURT OF HOLMES COUNTY IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE APPELLANTS.
LEE AND MYERS, P.JJ., GRIFFIS, BARNES, ISHEE AND ROBERTS, JJ., CONCUR. IRVING, J., CONCURS IN PART AND IN THE RESULT WITHOUT SEPARATE WRITTEN OPINION. CARLTON AND MAXWELL, JJ., NOT PARTICIPATING.
NOTES
[1] To protect the anonymity of minor victims of sexual abuse, we use initials to represent their names. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581065/ | 33 Wis. 2d 367 (1967)
STATE CENTRAL CREDIT UNION, Appellant,
v.
BAYLEY, Respondent.
Supreme Court of Wisconsin.
December 1, 1966.
January 3, 1967.
*369 For the appellant there were briefs by Thomas J. Bergen, attorney, and Kenneth G. Ogie of counsel, both of Milwaukee, and oral argument by Mr. Ogie.
For the respondent there was a brief and oral argument by Earl J. O'Brien of Milwaukee.
CURRIE, C. J.
Neither defendant's petition to vacate and discharge the cognovit judgment, nor the order of the county court appealed from, specifies any statute as being applicable. There was no oral or memorandum decision rendered by the county court so the record is barren of the ground on which the county court's order vacating and discharging the cognovit judgment was grounded. The issues on this appeal, as we view them, are:
(1) Does either sec. 269.46 (1), Stats., or sec. 270.91 (2), authorize the entry of the order appealed from?
*370 (2) If neither of these two statutes is applicable, did the county court, under its equitable powers, have the right to vacate and discharge the cognovit judgment on the ground of constructive fraud?
Applicability of sec. 269.46 (1), Stats.
Sec. 269.46 (1), Stats., provides:
"The court may, upon notice and just terms, at any time within one year after notice thereof, relieve a party from a judgment, order, stipulation or other proceeding against him obtained, through his mistake, inadvertence, surprise or excusable neglect and may supply an omission in any proceeding. In addition to the required affidavits, all motions to vacate a judgment entered upon default or cognovit and to obtain a trial upon the merits shall be accompanied by a proposed verified answer disclosing a defense."
In Harris v. Golliner,[1] this court proclaimed the general rule that under this statute the court is without jurisdiction to vacate a judgment on the grounds enumerated in the statute if more than one year has passed after notice of the judgment to the judgment debtor. Such lack of jurisdiction is one of subject matter rather than lack of jurisdiction over the parties.[2] "Knowledge" is equivalent to notice for the purpose of the statute.[3] The burden on the party moving to have a judgment vacated under this statute was described in Harris v. Golliner,[4] as follows:
"It is clear that to be entitled to relief under the statute the movant must show that the statutory period had not elapsed. If the moving papers showed that more *371 than a year had elapsed between the entry of the judgment and the making of the motion, but did not make any statement at all as to when the movant received notice of the judgment, the court would necessarily deny the motion, because the movant had not brought himself within the statute. It would not be incumbent on the respondent in such case to show affirmatively that the movant was notified of the judgment more than a year prior to the making of his motion. By the same token, if the statement made by movant fails to show definitely that he received notice of the judgment less than a year prior to the determination of his motion, he has not brought himself within the statute and his motion must be denied."[5]
Because the defendant's petition did not even allege that she was moving within one year after notice of judgment, it is clear that sec. 269.46 (1), Stats., would not have authorized the county court to vacate and discharge the judgment.
Applicability of sec. 270.91 (2), Stats.
Sec. 270.91 (2), Stats., provides in part as follows:
"Upon proper notice, any person who has secured a discharge in bankruptcy may apply to the court where such judgment was entered, for an order to satisfy such judgment as may have been duly discharged in such order of discharge in bankruptcy and which judgment was duly set forth and included in such schedules of bankruptcy as to the name and address of such judgment holder. If the court is so satisfied that such order of discharge in bankruptcy was duly obtained and that the name and address of such judgment creditor was included in such schedules of bankruptcy, then the court shall declare such judgment to be satisfied and direct satisfaction thereof to be entered on the docket...." (Italics supplied.)
Inasmuch as plaintiff's claim against defendant had not been reduced to judgment at the time of the filing *372 of the schedules in bankruptcy, this statute is wholly inapplicable and would not have authorized the county court's order vacating and discharging the cognovit judgment.[6]
Constructive Fraud.
The general rule is that the defense of a discharge in bankruptcy is an affirmative one which the bankrupt as a defendant must allege and prove.[7] However, when, as here, a judgment is entered upon a cognovit note wherein the answer in the judgment roll admitting liability has been signed by a lawyer pursuant to the warrant of attorney contained in the note, the bankrupt is precluded from interposing the discharge as a defense. This is wholly unlike the situation where suit is brought against the bankrupt on an obligation which has been released by the discharge in bankruptcy and the bankrupt defaults without interposing an answer pleading the discharge as a defense. In the latter case the bankrupt had his opportunity to avail himself of the defense but failed to utilize it.
We conclude that the instant judgment constituted a constructive fraud on the court which entered it since defendant bankrupt was prevented from asserting the discharge as a defense and the court entered a judgment which it would not have entered had the fact of the discharge been brought to its attention. Further, we determine that this is the type of fraud which entitled the court to vacate the judgment even though the judgment *373 be beyond attack by appeal.[8] It is immaterial whether the fraud here is classified as extrinsic or intrinsicit is sufficient that it is of a nature which shocks the conscience of the court.[9]
By the Court.Order affirmed.
NOTES
[1] (1940), 235 Wis. 572, 574, 294 N.W. 9.
[2] Vande Voort v. Stern (1962), 16 Wis. (2d) 85, 114 N. W. (2d) 126.
[3] Thorp Small Business Investment Corp. v. Gass (1964), 24 Wis. (2d) 279, 283, 128 N. W. (2d) 395; Langlade Realty Co. v. Magee (1914), 156 Wis. 457, 461, 145 N.W. 1101.
[4] Supra, footnote 1.
[5] Id. at page 576.
[6] As to the power of a court to permanently restrain the enforcement of a judgment on the basis of the discharge of the debt see: Leonard v. Yohnk (1887), 68 Wis. 587, 32 N.W. 702; Boynton v. Ball (1887), 121 U.S. 457, 7 Sup. Ct. 981, 30 L. Ed. 985.
[7] Pelikan v. Russell (1966), 29 Wis. (2d) 308, 310, 139 N. W. (2d) 22; see also 8B C. J. S., Bankruptcy, p. 139, sec. 584a.
[8] For cases holding that a court has the equity power to set aside a judgment for fraud even though the time for appeal has expired, see Estate of Baumgarten (1961), 12 Wis. (2d) 212, 222, 223, 107 N. W. (2d) 169; Estate of Kammerer (1959), 8 Wis. (2d) 494, 502, 99 N. W. (2d) 841; Will of Pettee (1954), 266 Wis. 347, 352, 63 N. W. (2d) 715; Will of Cosgrove (1941), 236 Wis. 554, 565, 566, 295 N.W. 784, 132 A. L. R. 1514. While these four cases happen to involve the probate jurisdiction of county courts, this rule is applicable to all courts. 30A Am. Jur., Judgments, pp. 728, 729, sec. 788; 49 C. J. S., Judgments, p. 486, sec. 269.
[9] This court has expressly disavowed the distinction of extrinsic or intrinsic fraud where the attack is collateral and not direct, as here, Weber v. Weber (1952), 260 Wis. 420, 51 N. W. (2d) 18; Hartenstein v. Hartenstein (1963), 18 Wis. (2d) 505, 517, 118 N. W. (2d) 881, footnote 6. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581071/ | 33 Wis. 2d 373 (1967)
COMMODORE, Plaintiff in error,
v.
STATE, Defendant in error.
Supreme Court of Wisconsin.
December 2, 1966.
January 3, 1967.
*376 For the plaintiff in error there was a brief and oral argument by Henry Dorman of Racine.
For the defendant in error the cause was argued by Betty R. Brown, assistant attorney general, with whom on the brief were Bronson C. La Follette, attorney general, William A. Platz, assistant attorney general, and Gerald E. Clickner, district attorney of Racine county.
HEFFERNAN, J.
The defendant contends that he was denied a speedy trial, that he was adversely affected by prejudicial publicity that attended his prosecution, that the display to the jury of the money found in the washbasin was prejudicial, and that the judge failed to instruct the jury that it could make a finding of guilt in regard to lesser but included offenses. On the basis of all; these contentions, the defendant maintains that the judgment should be reversed and a new trial ordered in the interest of justice.
*377 1. Was Commodore denied his constitutional right to a speedy trial?
Sec. 7, art. I of the Wisconsin constitution provides, among other things, that, "In all criminal prosecutions the accused shall enjoy the right ... to a speedy public trial by an impartial jury...." It is apparent from the record that the defendant was jailed in October of 1964 and was not brought to trial until July 20, 1965. However, as we have recently pointed out in State v. Reynolds (1965), 28 Wis. (2d) 350, 354, 137 N. W. (2d) 14, the mere lapse of time does not constitute a denial of the right to speedy trial. We have pointed out that the accused must be tried as soon as the orderly operation of the court permits. Kopacka v. State (1964), 22 Wis. (2d) 457, 461, 126 N. W. (2d) 78. This court has also consistently held that, in addition, the accused is required to take affirmative action to see that his case is brought on for trial before he can demand dismissal of charges on the basis of a denial of the constitutional right to speedy trial. State v. Reynolds (1965), 28 Wis. (2d) 350, 354, 137 N. W. (2d) 14; Hansen v. State (1965), 26 Wis. (2d) 238, 243, 131 N. W. (2d) 837; Kopacka v. State (1964), 22 Wis. (2d) 457, 460, 126 N. W. (2d) 78. Shortly after Commodore's apprehension, a detainer warrant was filed as a result of a previous sentence. He commenced a habeas corpus proceeding in this court as a result of that detainer. The record of this case is absolutely devoid of any affirmative action until after the disposition of that habeas corpus proceeding. Moreover, the trial judge found, and there is convincing evidence to support such finding, that the delay from October to May was attributable to the defendant's agreement with the district attorney to postpone further proceedings pending the outcome of the habeas corpus proceeding in this court arising from an earlier conviction. The trial judge stated:
*378 "... the defendant has personally at no time requested a hearing or a preliminary hearing upon the present charge that of burglary, however, it does appear that throughout the course of this proceeding the defendant has been represented by counsel, presumably of his own choice, who on his behalf acquiesced, participated or consented to, if not in fact, he did not procure the delays which have intervened between the present and the arrest of the defendant."
An affidavit of the district attorney, made a part of the record and which is not contradicted, states:
"[The] Court Commissioner of Racine County, had on numerous occasions personally contacted the defendant and requested of him whether a speedy preliminary hearing was requested and that the defendant personally informed the Court Commissioner that he did not want further proceedings on this matter until the determination by the Supreme Court on the motion in habeas corpus."
Subsequent to the disposition of the petition for habeas corpus in this court adverse to the defendant, the defendant discharged the attorney who first represented him, and on May 14, 1965, his newly selected trial counsel waived preliminary hearing. He was arraigned on May 17, 1965, and was brought to trial on July 20, 1965. It is therefore apparent that, once the defendant took affirmative action to have his matter brought to trial, the matter was disposed of promptly. Whatever delay there was in bringing this matter to a conclusion was, to a great degree at least, of the defendant's own making. The defendant was not deprived of his constitutional right to a speedy trial.
We note also that, as a remedy for failure to provide a speedy trial, the defendant demands a new trial. Such remedy would appear inappropriate, for were the defendant deprived of that constitutional right, the defect could not be remedied by another trial further delayedthe remedy would be a dismissal of the charge and a bar to further prosecution.
*379 2. Was the defendant prejudiced by improper publicity or by the judge's failure properly to instruct the jury in regard thereto?
The defendant also claims that prejudicial publicity made a fair trial impossible and that it was error for the trial judge to refuse to instruct the jury or to refuse to question the jury to determine whether any of its members had read an article appearing in the local paper during the course of trial. There is no evidence to show that the particular article or any of the other publicity attendant upon Commodore's apprehension or trial was prejudicial. The article appeared in a two-column story at the bottom of page 5 of the Racine Journal Times. The relatively inconspicuous headline stated, "Testifies to Apprehension of Suspect in Burglary." The news story appears to be a completely accurate and dispassionate account of the testimony elicited at trial. Moreover, the record does not reveal that trial counsel asked for a special instruction to disregard prejudicial newspaper publicity. Trial counsel asked that the jurors be questioned to determine whether or not they had read the story. The judge denied this request. Under the circumstances we cannot conclude that this was error. On the face of it, the newspaper article was not prejudicial, nor is there any evidence that it was. The record also contains a photograph taken at the time of defendant's apprehension on the night of October 22-23, 1964. This photograph appeared in the Milwaukee Journal, and there is nothing to show that any of the jurors had seen the photograph prior to the time it was introduced into evidence at the instance of the defendant. Nothing in either of these newspaper reports is indicative of any bias or feeling against the defendant on the part of the press or public which might prejudice the jurors in arriving at an impartial verdict. Although counsel states that the defendant was apprehended by the police in the midst of a "circus-like atmosphere," there is nothing in the record *380 to indicate that circumstances of that apprehension or the publicity attendant thereto (which appeared in the newspaper in another city) prejudiced the defendant at trial. Counsel relies upon Sheppard v. Maxwell (1966), 384 U.S. 333, 351, 86 Sup. Ct. 1507, 16 L. Ed. (2d) 600. The very quotation used by counsel, however, makes apparent the inappropriateness of the Sheppard Case to the instant one:
"`With his life at stake, it is not requiring too much that petitioner be tried in an atmosphere undisturbed by so huge a wave of public passion....'"
We find no circumstances here that are indicative of prejudicial publicity. The usual admonition that was given by the court stating, "In determining the guilt or innocence of the defendant, you should be governed solely by the evidence brought before you and the instruction of the court ...," was adequate to safeguard the rights of the defendant under these particular circumstances.
3. Did the conduct of the district attorney hopelessly and irretrievably prejudice the defendant's case?
The defendant contends that the district attorney, "with gusto and relish, emptied the contents of the money bag upon counsel's table and triumphantly proceeded to count the money. All this within sight and hearing of the jury." This money, in the amount of $20.36, was allegedly that found in the washbasin in the men's room. This money was not offered in evidence because the district attorney stated that to establish the chain of custody would require an undue disruption of the normal activities of the police force. Defendant maintains that the display of the money was prejudicial in that it constituted the sole evidence of defendant's "intent to steal" and that the display of this money supplied the necessary "link" that led to the conviction of defendant. The incident, if as described, would be more appropriate to the *381 theater than to the courtroom and constitutes unnecessary prosecutorial histrionics, but in this instance it cannot be said to be prejudicial. There was ample proof otherwise available of record to support the jury's verdict concerning the element of intent. The officers testified that they saw the defendant's "hands in the till" and, in addition, the testimony of the police captain established the fact that Commodore stated he was in the tavern because "I ran a little short and needed some quick dough."
While the defendant claimed that he was so intoxicated that he could not have formed any intent, this assertion was contradicted by the statements of witnesses who had seen Commodore a short time prior to the burglary and by the police officer's testimony that he did not appear intoxicated when apprehended. The jury therefore, as the trier of the fact, could disbelieve the testimony of Commodore and could conclude on the basis of the evidence that he had entered the tavern with the intent to steal.
4. Should a new trial in the interests of justice be granted because of error in refusing to instruct jury to consider the possibility of finding defendant guilty of either criminal trespass to dwellings, sec. 943.14, Stats., or disorderly conduct, sec. 947.01?
As stated, the defendant based his defense upon the allegation that he was so intoxicated that he could not have formed the requisite intent to steal. Since it was clear that he was apprehended on the premises, and some explanation of his presence was imperative, his counsel requested that the trial court instruct the jury to consider whether the defendant was guilty of two less serious offenses, trespass to a dwelling in violation of sec. 943.14, Stats., or disorderly conduct in violation of sec. 947.01. The defendant argues that it was error on the part of the *382 trial judge to refuse such instructions. He relies upon sec. 939.66, which reads in part:
"Conviction of included crime permitted. Upon prosecution for a crime, the actor may be convicted of either the crime charged or an included crime, but not both. An included crime may be any of the following:
"(1) A crime which does not require proof of any fact in addition to those which must be proved for the crime charged."
Even if the lesser crimes which he as asserts were deemed to be offenses included within the original charge, it is apparent that there was no error in refusing the additional instructions requested by the defendant. In Devroy v. State (1942), 239 Wis. 466, 468, 1 N. W. (2d) 875, we stated:
"In passing upon the assignment of error in question there are applicable the rules that`to justify a conviction, and submittal for conviction of a lesser offense included within the greater, "there must be some reasonable ground on the evidence, in the judgment of the court, for a conviction of the former and not of the latter." In the final analysis of the evidence, the test to be applied, in determining whether lesser degrees of the offense charged are to be submitted on request, is whether in any reasonable view of the evidence there is reasonable ground on the evidence, in the judgment of the court, for a conviction of the lesser offense and not the greater?' Sweda v. State, 206 Wis, 617, 625, 240 N.W. 369; Hempton v. State, 111 Wis. 127, 140, 86 N.W. 596; Weisenbach v. State, 138 Wis, 152, 119 N.W. 843; Krueger v. State, 171 Wis. 566, 578, 177 N.W. 917; Meyer v. State, 176 Wis. 184, 187, 185 N.W. 520."
This precedent requires that the trial court find not only that there are reasonable grounds on the evidence to support conviction of the lesser offense but also that there are not reasonable grounds on the evidence to convict of the greater offense. On the basis of the evidence adduced at this trial there is no question that the evidence adduced, if believed by the jury, would support *383 the conviction of the greater offense. The defendant's claim of error in this respect is totally without merit.
5. Should the defendant be granted a new trial in the interests of justice?
The defendant also contends, considering all of the allegations of error, that it lies within the discretionary power of this court under sec. 251.09, Stats., to reverse the conviction of the trial court and to order a new trial in the interests of justice. This power is exercised with "some reluctance and with great caution" and only in the event of a probable miscarriage of justice. Ferry v. State (1954), 266 Wis. 508, 511, 63 N. W. (2d) 741. Such grave doubt must exist regarding a defendant's guilt to induce the belief that justice has miscarried. State v. Fricke (1934), 215 Wis. 661, 667, 255 N.W. 724. In Lock v. State (1966), 31 Wis. (2d) 110, 118, 142 N. W. (2d) 183, we stated:
"In order for this court to exercise its discretion and for such a probability [of a miscarriage of justice] to exist we would at least have to be convinced that the defendant should not have been found guilty and that justice demands the defendant be given another trial."
A review of the entire record can only result in the conclusion that the defendant was properly convicted of the crime charged. There is nothing to indicate that justice has not been well served by this conviction, nor is there one shred of evidence to indicate that a different result would obtain under optimum circumstances. It is most unlikely that a new trial would result in an acquittal.
By the Court.Judgment affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581078/ | 5 Mich. App. 691 (1967)
147 N.W.2d 751
DEAN
v.
ARROWHEAD STEEL PRODUCTS COMPANY, INC.
Docket No. 1,523.
Michigan Court of Appeals.
Decided January 24, 1967.
Leave to appeal granted March 29, 1967.
Appeal dismissed February 23, 1968.
*694 Ross & Bruff and Julius M. Grossbart, for plaintiff
Alexander, Buchanan & Conklin, for defendants Arrowhead and Employers' Mutual Liability Insurance Company.
Leave to appeal granted by Supreme Court March 29, 1967. See 379 Mich. 757.
Appeal dismissed per stipulation February 23, 1968.
HOLBROOK, J.
This is an appeal from an order of the workmen's compensation appeal board. The defendant-employer and its insurance carrier appeal from the order in question dated November 8, 1965, affirming the award of compensation by the hearing referee to plaintiff-dependent and permitting her administratrix to be substituted for her. *695 The order limited weekly compensation to be paid to May 30, 1965, date of death of plaintiff-dependent, and denied apportionment of liability with prior employers.
Defendants-appellants raise the following questions for review: (1) Whether the plaintiff's decedent sustained a personal injury and death due to causes and conditions of his employment at Arrowhead Steel Products Company, Inc.? (2) Whether the liability for compensation may be apportioned among prior employers? (3) When the widow of the deceased employee dies prior to the entry of a final order, and when there is no provision in the workmen's compensation law for any administrator or personal representative to prosecute the matter before the workmen's compensation department, does such death of the widow abate the proceedings before the workmen's compensation appeal board?
The pertinent facts appear to be as follows: Howard E. Dean, the employee, had been employed in several foundries from 1914 until his illness in January of 1960, culminating in his death in June of 1960. He left surviving him his wife, and two adult children. The cause of his death was respiratory failure due to chronic emphysema and anthracofibrosis of the lungs, more specifically silicosis. At the time of his death, Howard Dean was 66 years old. He had been employed by Arrowhead Steel, his last employer, from October 1955 until January 12, 1960. Application for hearing was filed by L.V.L. Dean, widow. Upon motion of defendant several other prior employers of the deceased were joined as parties defendant. After hearing the matter, the referee on May 17, 1962, found that Howard E. Dean did receive a personal injury while in the employment of the defendant *696 Arrowhead Steel and from such injury, death resulted. He ordered the defendant and its insurer to pay $33 per week to L.V.L. Dean, widow, and also certain medical and funeral bills. The hearing referee denied apportionment and dismissed all prior employers and their insurers. The defendants appealed to the workmen's compensation appeal board. Mrs. Dean died May 30, 1965. On June 16, 1965, suggestion of her death was filed and on July 26, 1965, motion was made to substitute her administratrix as plaintiff. The board ordered such substitution August 9, 1965. On November 8, 1965, the workmen's compensation appeal board affirmed the order of the hearing referee but limited payment of weekly benefits to the date of Mrs. Dean's death.
The plaintiff testified that her husband's health was "quite well" before he went to work at Arrowhead Steel. Thereafter she felt that his health became gradually worse. She testified that he came home from his employment at Arrowhead Steel covered with dust, exhausted, and wet with perspiration. She said she had to wash his hat about once a month. The first time Mr. Dean lost work time at Arrowhead Steel was in 1957, when he went to the University Hospital at Ann Arbor for what Mrs. Dean described as "oxygen." He was again in the hospital in 1958 for two weeks and remained home for an additional month. He returned to the hospital in May of 1960 and was there until his death on June 2, 1960.
The first issue raised by appellants questions the sufficiency of the evidence to justify a finding of fact that Mr. Dean sustained a personal injury and death due to causes and conditions of his employment at Arrowhead Steel Products Company, Inc.
We believe it is well to review the pertinent provisions of the workmen's compensation act that have *697 a bearing upon this aspect of the case. The term personal injury is defined in this act as follows:
"a disease or disability which is due to causes and conditions which are characteristic of and peculiar to the business of the employer and which arises out of and in the course of the employment." CL 1948, § 417.1 (Stat Ann 1960 Rev § 17.220).
The following section[1] provides that disablement of an employee from an occupational disease or disability shall be treated as a happening of a personal injury. The next section[2] provides that if an employee's disability or death is caused by such disease due to the nature of the employment in which such employee was engaged and was contracted therein, he or his dependents shall be entitled to compensation.
The final section,[3] at the time the award was made, provided in part as follows: "The total compensation due shall be recoverable from the employer who last employed the employee in the employment to the nature of which the disease was due and in which it was contracted."
Appellants assert that plaintiff's decedent must show some exposure at defendant's foundry which caused the personal injury or at least caused an aggravation of the same in order to justify the order for compensation. With this claim we agree.
That Mr. Dean was exposed to conditions conducive to silicosis at most of the places of his employment from 1914 to January 12, 1960, is undisputed. Mr. Dean was working in defendant's foundry making aluminum castings. Permanent steel molds, coated with a graphite substance made by a secret process were used. These molds were *698 cleaned twice daily with an electric wire brush which removed the die coating. There was testimony to the effect that in this process, sand or silicon was not used in the molds. An expert testified for defendants that there was dust present in the foundry and that less than 15% was free silica. The plant inspection upon which the expert based his testimony was made about a year after Mr. Dean's death. We have no testimony showing the exact content of free silica in the air at the foundry during the 5 years that Mr. Dean worked there. We do have the testimony of Mrs. Dean that her husband came home from Arrowhead Steel "covered with dust." Defendants' medical witness, Dr. Hendrix, testified that aluminum oxide fumes from the molding process would not be harmful. This was based on the assumption that defendant was using pure aluminum. However, he further testified that if they were using an aluminum alloy, the same might be harmful. Assuming the facts enumerated in a hypothetical question as being true, Dr. Hendrix testified that in his opinion Mr. Dean's disease was probably related to his earlier period of employment.
Subsequently, Dr. Hendrix also testified as follows:
"Q. Doctor, if I told you that his latest period of employment had silica, was detected in the air at his place of employment, your answer, of course, then would be different, wouldn't it?
"A. Yes, not much, but it would be different.
"Q. What do you mean, `not much'?
"A. Well, I testified that his lung disease was due to exposure to silica. I don't know where or when he got it. * * *
"Q. If you were to assume that this man was subjected to some exposure of free silica in the air during his last employment subsequent to 1954, *699 would you feel that would be related to the condition which you found?
"A. Yes, it would.
"Q. It could be as well as the exposure prior to that date, could it not?
"A. Yes."
During Mr. Dean's employment with defendant, he was exposed to fumes from an aluminum alloy, aluminum oxide, graphite, and free silica and other dust.
Dr. Woodworth, plaintiff's medical witness, testified:
"Well, in addition to this there are other irritants and dusts present in a foundry besides silicon, though that is usually always present to some degree, which are liable to invoke an inflammatory or allergic response in a person who has previously existing respiratory disease."
Dr. Woodworth cared for Mr. Dean for 5 years prior to his death. The doctor advised him on several occasions to get away from the foundry work. Dr. Woodworth attributed the disease and death of the decedent employee to conditions of foundry employment.
The workmen's compensation appeal board in its opinion stated in part as follows:
"A dispute arose over which of these two employers last employed deceased at the work, the nature of which allegedly caused death. Arrowhead Steel Products was the last employer but they claim their foundry was so clean that deceased could not have been exposed to any conditions which could have contributed to death. * * *
"Plaintiff presented the testimony of Dr. Edwin S. Woodworth who had treated deceased from 1954 until his death. This doctor was engaged in the general practice of medicine. At the hearing he laid no claim to fame as an expert in the field of *700 respiratory diseases by having authored articles upon the subject of dust diseases. His testimony is typical of the general practitioner and is subject to interpretation, but in essence, does support plaintiff's claim that the death of her husband was attributable to the condition of foundry employment for many years' duration. * * *
"It is evident that he was, while employed by defendant, exposed to carbon and silica both of which were found in his lungs after death. The autopsy showed an emphysematous condition of the lungs resulting from the particles of carbon and silica. The medical evidence shows that this respiratory condition caused death.
"We hold that the death of Howard Dean was due to causes and conditions characteristic of and peculiar to the foundry industry. His last exposure to such conditions occurred while he was employed by Arrowhead Steel Products."
The workmen's compensation act provides that findings of fact made by the workmen's compensation appeal board acting within its powers, shall, in the absence of fraud, be conclusive.[4]
In Coates v. Continental Motors Corporation (1964), 373 Mich. 461, Mr. Justice SOURIS quoting Mr. Justice BLACK stated on p 467 in part as follows:
"`Our jurisdiction, invoked upon issuance and return of certiorari to the workmen's compensation department, is markedly limited. The writ brings us questions of law only. It does not permit scale-weight of evidence and inference here, as on appeals from circuit court judgments, to determine whether administrative findings of fact offend rules governing clear weight and preponderance. Our obligation is to accept, without question, findings that are certified here if there be any evidence whatever to *701 sustain those findings, regardless of thought or suggestion addressed to improbability thereof.'"
Adhering to the provisions of the act and applying the rule stated so clearly in the Coates Case, supra, to the facts in this case, we are compelled to hold that there was evidence in the record sufficient to sustain the findings of fact of the workmen's compensation appeal board.
The second issue raised by appellants is the claim that the apportionment amendment[5] to the workmen's compensation act should be applied retroactively. This same question arose in the case of Briggs v. Campbell, Wyant & Cannon Foundry Company (1966), 2 Mich. App. 204. Therein, one of the claimants, Mr. Harrington, was found by the hearing referee to have suffered an occupational injury of silicosis or a related disease on March 2, 1960, and an award for compensation was ordered prior to the effective date[6] of the apportionment amendment. The facts in our case are the same with the injury occurring in January 1960 and the referee's award ordered May 17, 1962. Because at the time of the hearing before the referee the apportionment provision in the act was unconstitutional because it failed to provide for legal notice to be given prior employers affording them an opportunity to resist the claim at the original hearing, where, subject to the right of appeal, validity of the claim is conclusively determined, we held that apportionment could not be ordered. Trellsite Foundry & Stamping Company v. Enterprise Foundry (1961), 365 Mich. 209. We further held in Briggs, supra, that the apportionment amendment, CL 1948, § 417.9, as amended by PA 1962, No 189 (Stat Ann 1963 Cum *702 Supp § 17.228), was to be applied prospectively for reasons therein stated.
The last issue raised by appellants is the claim that the death of the dependent of the deceased employee before a decision of the workmen's compensation appeal board abates the proceedings.
In determining this last issue, we deem it appropriate to review the pertinent provisions of the workmen's compensation act applicable and set them forth as follows:
"An employee, who receives a personal injury arising out of and in the course of his employment by an employer who is at the time of such injury subject to the provisions of this act, shall be paid compensation in the manner and to the extent hereinafter provided, or in case of his death resulting from such injuries such compensation shall be paid to his dependents as hereinafter defined. The term `time of injury' or `date of injury' as used in this act shall in the case of a disease or in the case of an injury not attributable to a single event be the last day of work in the employment in which the employee was last subjected to the conditions resulting in disability or death." CLS 1961, § 412.1 (Stat Ann 1960 Rev § 17.151). (Emphasis supplied.)
"If death results from the injury, the employer shall pay, or cause to be paid, subject, however, to the provisions of section 12 hereof, in one of the methods hereinafter provided, to the dependents of the employee, wholly dependent upon his earnings for support at the time of the injury, a weekly payment equal to 66-2/3% of his average weekly wages for a period of 450 weeks from the date of the death, the weekly payment not to exceed, however, $33.00 for 1 dependent." CLS 1961, § 412.5 (Stat Ann 1960 Rev § 17.155). (Emphasis supplied.)
*703 "The following persons shall be conclusively presumed to be wholly dependent for support upon a deceased employee:
"Wife. (a) A wife upon a husband with whom she lives at the time of his death, or from whom, at the time of his death the department of labor and industry shall find the wife was living apart for justifiable cause or because he had deserted her." CL 1948, § 412.6 (Stat Ann 1960 Rev § 17.156).
"Questions as to who constitute dependents and the extent of their dependency shall be determined as of the date of the injury to the employee, and their right to any death benefit shall become fixed as of such time, irrespective of any subsequent change in conditions; and the death benefit shall be directly recoverable by and payable to the dependent or dependents entitled thereto, or their legal guardians or trustees. In case of the death of 1 such dependent, his proportion of such compensation shall be payable to the surviving dependents pro rata. Upon the death of all such dependents compensation shall cease." CL 1948, § 412.7 (Stat Ann 1960 Rev § 17.157). (Emphasis supplied.)
"Compensation shall be paid promptly and directly to the person entitled thereto and shall become payable on the fourteenth day after the employer has notice or knowledge of the disability or death, on which date all compensation then accrued shall be paid. Thereafter compensation shall be paid in weekly installments." CL 1948, § 413.5 (Stat Ann 1960 Rev § 17.178). (Emphasis supplied.)
"Upon the filing with the compensation commission, by any party in interest, of any application in writing stating the general nature of any claim as to which any dispute or controversy may have arisen, the commission shall set the case for hearing and shall designate 1 of its members or deputy *704 members to hear the case." CL 1948, § 413.7 (Stat Ann 1960 Rev § 17.181).
"The member or deputy member of the commission assigned to any hearing in accordance with the provisions of section 7 shall make such inquiries and investigations as it shall deem necessary. The hearings of the member or deputy member of the commission shall be held at the locality where the injury occurred, and the decision of the member or deputy member of the commission shall be filed with the compensation commission. Unless a claim for a review is filed by either party within 10 days, the decision shall stand as the decision of the compensation commission: Provided, That said commission may, for sufficient cause shown, grant further time in which to claim such review." CL 1948, § 413.8 (Stat Ann 1960 Rev § 17.182).
"If a claim for review is filed, as provided in part 3, section 8, the compensation commission shall promptly review the decision, together with such records as may have been kept of its hearing, and shall also, if desired, hear the parties, together with such additional evidence as the compensation commission in its discretion may allow them to submit, and file its decision therein with the records of such proceedings." CL 1948, § 413.11 (Stat Ann 1960 Rev § 17.185). (Emphasis supplied.)
Reviewing the provisions of the act as above quoted and applying them to the facts of our case, we find: Mr. Dean suffered an injury (occupational disease) in January 1960 which caused his death June 2, 1960, entitling his dependents to benefits "such compensation shall be paid" by the employer. Mrs. Dean as widow was deemed to be wholly dependent for support upon her deceased husband. Mrs. Dean's dependency was determined as of the date of the injury to her husband and in the language of the act her "death benefit shall become *705 fixed as of such time irrespective of any subsequent change in conditions and the death benefit shall be directly recoverable by and payable" to her. Upon her death in May 1965, compensation shall cease. Mrs. Dean's compensation was required to be paid promptly and directly every week. However, because there was a dispute as to liability, her application for compensation of July 1, 1960, was delayed to provide a hearing on the merits. This was accomplished in due time and the hearing referee more than 22 months later, May 17, 1962, awarded her compensation. However, the employer being not satisfied with the result appealed to the workmen's compensation appeal board May 24, 1962. The review of this decision was required to be promptly accomplished. More than 3 years later, May 30, 1965, no decision had been made and Mrs. Dean died without receiving any compensation although it was mandatorily required by the act. This is said advisedly for Mrs. Dean's husband had worked for many years in several foundries and it was undisputed that he died of silicosis contracted at his work. The only issues advanced by defendant before the hearing referee were (1) the causal connection of plaintiff's decedent's disease at defendant's foundry and (2) apportionment with the prior employers. At least these were the only issues until the inevitable happened after more than 5 years of litigation before the workmen's compensation commission without a decision, Mrs. Dean died. The administratrix of Mrs. Dean, her personal representative, requested of the workmen's compensation appeal board the right to be substituted so that the matter might finally be determined as to whether the hearing referee's award to Mrs. Dean in 1962 was correct. With the death of Mrs. Dean we no longer have 2 issues, for defendants have added a third. The workmen's compensation appeal *706 board granted the petition for substitution and thereafter promptly affirmed the award of compensation by the hearing referee but limited compensation to be paid to the date of Mrs. Dean's death.
According to the certification of record received from the workmen's compensation appeal board the decision of the hearing referee was mailed May 18, 1962, and the claim for review by defendant Arrowhead and Employers' Mutual was filed May 25, 1962. Notwithstanding that the parties have the right to present additional testimony before the workmen's compensation appeal board and the matter was to be heard de novo, defendants were content to leave the matter dormant until after the suggestion of Mrs. Dean's death was filed June 16, 1965.
Defendants and appellants now state that Mrs. Dean's death abated the proceedings and in support of their position refer the court to the cases of Schlickenmayer v. City of Highland Park (1931), 253 Mich. 265; Munson v. Christie (1935), 270 Mich. 94; and Stone v. Smith (1936), 275 Mich. 344.
A reading of these cases will verify that at the time they were decided, our Supreme Court ruled that the workmen's compensation act contained no provision for the personal representative of a deceased employee, as distinguished from dependent, prosecuting a proceeding before the department of labor and industry.
Fortunately we now have a provision in the workmen's compensation act for a personal representative of a deceased claimant continuing the proceeding before the workmen's compensation commission. It is CL 1948, § 412.12, as amended by PA 1965, No 230 (Stat Ann 1965 Cum Supp § 17.162) and is as follows:
"Sec. 12. The death of the injured employee prior to the expiration of the period within which *707 he would receive such weekly payments shall be deemed to end such disability, and all liability for the remainder of such payments which he would have received in case he had lived shall be terminated, but the employer shall thereupon be liable for the following death benefits in lieu of any further disability indemnity.
"If the injury so received by such employee was the proximate cause of his death, and such deceased employee leaves dependents, as hereinbefore specified, wholly or partially dependent on him for support, the death benefit shall be a sum sufficient, when added to the indemnity which shall at the time of death have been paid or become payable under the provisions of this act to such deceased employee, to make the total compensation for the injury and death exclusive of medical, surgical and hospital services and medicines furnished as provided in section 4, equal to the full amount which such dependents would have been entitled to receive under the provisions of section 5, in case the injury had resulted in immediate death, and such benefits shall be payable in the same manner as they would be payable under the provisions of section 5 had the injury resulted in immediate death.
"If a claim for benefits has been filed but has not been decided by a referee or on appeal, and the claimant dies from a cause unrelated to his injury, the proceedings shall not abate but may be continued in the name of his personal representative. In such case, the benefits payable up to time of death shall be paid to the same beneficiaries and in the same amounts as would have been payable if the employee had suffered a compensable injury resulting in death."
This amendment was ordered to take immediate effect and was approved July 16, 1965, prior to the date that the workmen's compensation appeal board ordered the substitution of the administratrix of Mrs. Dean, as plaintiff. Can we seriously *708 consider that an administrator may be substituted for a deceased claimant but not for a claimant's beneficiary? According to the act the employee-claimant and his beneficiaries upon his death are equally entitled to relief under this act. In Munson v. Christie, supra, citing City of Grand Rapids v. Crocker (1922), 219 Mich. 178, it is stated in part as follows (p 97):
"insofar as it provides for remedial action, it concerns only two classes of persons employers and employees, the latter term being used in its broader sense as including dependents." (Emphasis supplied.)
In 24 MLP, Workmen's Compensation § 2, p 229, it is stated as follows:
"The primary purpose of the workmen's compensation act is to provide compensation for disability or death resulting from occupational injuries or diseases or accidental injury to or death of employees. The statute is a remedial one enacted primarily for the benefit of the man who works in the pursuits subject to its provisions; it is for the benefit of injured employees and not injured employers."
The amendatory act, PA 1965, No 230, is procedural and deprives defendant of no substantive right. In any event, defendants will be only required to pay that which the act at all times provided they should have paid, but for the delay occasioned in part by defendants claiming a review from the award made by the hearing referee. If defendants are correct in their claims stated on review from the hearing referee they cannot be harmed. However, if they are wrong can they be heard to say the act protects employers who are able to outlive their employees or their dependents during litigation? In the background although not *709 strictly relevant, the question arises as to who paid the expenses of living for Mrs. Dean for the more than 5 years that she survived her husband before her own untimely death? Was she required to borrow money? Was she able to borrow it upon the strength of the workmen's compensation act? Did she incur debts? Were the butcher, baker, and the candlestick maker paid? Did they and her doctor and possibly the hospital wait expectantly and hopefully for her to receive her just compensation? The probable answers to these questions are obvious.
Our Supreme Court has said that an amendment to the workmen's compensation act for correcting an injustice is remedial in nature and is to be given retroactive effect. Lahti v. Fosterling (1959), 357 Mich. 578; Rookledge v. Garwood (1954), 340 Mich. 444.
If a recent ruling of the Supreme Court is to be given effective life in the instant case, the present proceedings must not abate because of Mrs. Dean's death. In Miller v. Bath Elevator Co. (1959), 357 Mich. 9, Mr. Justice TALBOT SMITH stated on pp 17 and 18 as follows:
"Under the common law of earlier times it was often cheaper to kill a man than merely to maim him. `In a civil court,' said Lord Ellenborough in Baker v. Bolton, 1 Camp 493 (170 Eng Rep 1033), `the death of a human being could not be complained of as an injury.'
"It was inevitable that a doctrine so monstrous, its origins so obscure and puzzling, should receive legislative amelioration and such has been the case. Even with relation to workmen's compensation, which is in no respects a damage remedy, it is provided by statute that compensation for an industrial injury shall not be interred with the body. Yet, despite the express mandate of an enlightened public conscience, clearly stated in the compensation *710 act itself, we are besought to read this provision out of the act by a process of judicial interpretation. We are invited to engraft this grotesque stalk of the common law, long discredited and unlamented, upon one of the great remedial acts of our times, thus infusing the ancient obscenity with new life and vigor. This we cannot do. The people have said otherwise.
"They have provided in section 1 of part 2 of the workmen's compensation act[7] that compensation payable an injured employee shall `in case of his death * * * be paid to his dependents.' To my way of thinking this settles the matter." (Footnote omitted.) (Emphasis supplied.)
Our Supreme Court has ruled that the workmen's compensation act is to be construed liberally to provide indemnity for accidents peculiarly incidental to employment. Lauder v. Paul M. Wiener Foundry (1955), 343 Mich. 159.
To construe CL 1948, § 412.7 (Stat Ann 1960 Rev § 17.157) liberally or literally requires Mrs. Dean's right to benefits be regarded as fixed as of the date of her husband's death, irrespective of any subsequent changes in conditions. The only way to give effect to the expressed legislative intent of the workmen's compensation act in the case before us is to allow the substitution of the personal representative for Mrs. Dean to continue the matter to conclusion. We so rule.
Affirmed. Costs to appellee.
LESINSKI, C.J., and J.H. GILLIS, J., concurred.
NOTES
[1] CL 1948, § 417.2 (Stat Ann 1960 Rev § 17.221).
[2] CLS 1961, § 417.3 (Stat Ann 1960 Rev § 17.222).
[3] CL 1948, § 417.9 (Stat Ann 1960 Rev § 17.228).
[4] CL 1948, § 413.12 (Stat Ann 1960 Rev § 17.186).
[5] PA 1962, No 189.
[6] March 28, 1963.
[7] PA 1912 (1st Ex Sess), Act 10. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581189/ | 42 So. 3d 238 (2010)
VAUGHN
v.
McNEIL.
No. 1D09-6390.
District Court of Appeal of Florida, First District.
August 19, 2010.
Decision Without Published Opinion Certiorari denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2858874/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-93-142-CR
BRAD LEE PASCHAL,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE COUNTY COURT AT LAW NO. 6 OF TRAVIS COUNTY
NO. 377,631, HONORABLE DAVID E. PURYEAR, JUDGE PRESIDING
Appellant entered a no contest plea before the trial court and was convicted of the
offense of driving a motor vehicle in a public place while intoxicated. Appellant appeals and
asserts in three points of error that the trial court erred in failing to suppress his oral statements
that he could not perform two field sobriety tests, because the statements were not voluntary, as
the court ruled, but were the product of custodial interrogation obtained in violation of Tex.
Const. art. I, § 10, and Tex. Code Crim. Proc. Ann. art. 38.22 (West 1979). We will affirm the
judgment.
At about 1:30 a.m., May 30, 1992, Austin Police Officer Samuel Ramirez saw "a
red-over-black Chevy S10 Blazer" swerving from lane to lane on Research Boulevard. Ramirez
activated his emergency lights and followed the Blazer. The Blazer driver drove about two blocks
and entered a convenience store parking lot and stopped. Ramirez approached the Blazer on the
driver's side. Appellant was the driver and sole occupant of the Blazer. Ramirez smelled a strong
alcoholic odor coming from within the Blazer. When Ramirez asked appellant to see his driver's
license, appellant "passed over it" several times before he found it and showed it to Ramirez.
Ramirez asked appellant to get out and walk to the back of the Blazer. Appellant had to steady
himself by leaning on the Blazer. When appellant reached the back of the Blazer, appellant
announced that he "had too much to drink to be driving." Ramirez asked appellant if he was
willing to do some field sobriety tests to determine whether he would be able to drive safely.
Appellant attempted to recite the alphabet but was unable to do so correctly. When appellant was
asked to do a balancing test and "a finger-to-nose test," he said he could not do these tests.
Appellant attempted twice to do the "heel-to-toe" test, but he completely failed both times.
Appellant refused to do any more tests. Ramirez arrested and handcuffed appellant and advised
him of his rights under Miranda v. Arizona, 384 U.S. 436 (1966). Ramirez found eleven, twelve-ounce cans of cold beer and some partially eaten food in the Blazer.
On hearing appellant's motion to suppress, the trial court ruled that appellant's
statements that he could not do two of the field sobriety tests would be admitted as volunteered
statements. Appellant urges that the statements "I can't do this test" were the result of custodial
interrogation and were therefore not voluntary. These statements, he argues, were unlawfully
obtained in violation of appellant's state constitutional and statutory rights.
Jones v. State, 795 S.W.2d 171 (Tex. Crim. App. 1990), cited by both appellant
and the State, controls the disposition of this case. In that case, the Court of Criminal Appeals
held that: "Police requests that suspects perform the sobriety tests and directions on how suspects
are to do these tests do not constitute `interrogation'. . . . If the police limit themselves to these
sorts of questions, they are not `interrogating' a DWI suspect." Id. at 176, see also Chadwick
v. State, 795 S.W.2d 177 (Tex. Crim. App. 1990). Police questioning incident to "activity
normally attendant to arrest and custody" of a DWI suspect is not "interrogation." Jones, 795 at
172.
Officer Ramirez asked appellant if he was willing to do some sobriety tests and
instructed him how to do these tests. Appellant attempted, but failed to do two of the tests.
Without attempting to do them, appellant stated he could not do the other two tests. Perhaps the
reason he could not do these tests is explained by his other voluntary statement that he "had too
much to drink to be driving." Appellant acknowledges that the latter statement was volunteered.
Appellant's statements that he could not do the two field sobriety tests were not the
result of interrogation. Ramirez's questioning incident to the field sobriety tests was activity
normally attendant to appellant's arrest and custody as a DWI suspect; it was not "interrogation"
likely to be perceived as calling for an incriminating response. The trial court properly held that
the statements were volunteered and were not the result of "interrogation" or its functional
equivalent. Appellant's points of error are overruled.
The judgment is affirmed.
Carl E. F. Dally, Justice
Before Justices Aboussie, Jones and Dally*
Affirmed
Filed: June 22, 1994
Do Not Publish
* Before Carl E. F. Dally, 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/1581121/ | 147 N.W.2d 797 (1967)
181 Neb. 287
Mary CARSON, Appellee,
v.
DOBSON BROS. CONSTRUCTION COMPANY, a Nebraska Corporation, Appellant.
No. 36295.
Supreme Court of Nebraska.
January 17, 1967.
Cline Williams, Wright, Johnson, Oldfather & Thompson, Fredric H. Kauffman, Lincoln, for appellant.
Merril R. Reller, Donald R. Hays, Lincoln, for appellee.
Heard before WHITE, C. J., BOSLAUGH, BROWER, SMITH and Mc-COWN, JJ., and C. THOMAS WHITE, District Judge.
C. THOMAS WHITE, District Judge.
The plaintiff, Mary Carson, brought suit against Dobson Bros. Construction Company, a Nebraska corporation, for damages on account of personal injuries sustained in a fall into an excavation. The trial resulted in a verdict for the plaintiff of $4,250. Motion for judgment notwithstanding the verdict or for new trial was overruled, and defendant appeals.
*798 The evidence discloses that plaintiff, a housewife and resident of Lincoln, Nebraska, arose prior to 3:30 a. m. on April 19, 1964, to assist her daughters, ages 12 and 14, in the delivery of the Sunday World-Herald newspapers. The plaintiff had done so for a period of about 1 year. Her help consisted of driving her car only. It was a dark night, raining, and foggy. For the purpose of acquainting Mr. Elmer Meyers with the route so that he could deliver the papers when plaintiff and her daughters were out of town, the plaintiff drove her car onto Twelfth Street in Lincoln. Twelfth Street, at the area in question, is a graveled street running north and south. There are no sidewalks along Twelfth Street in the area. The plaintiff approached the Meyers' home from the south and stopped her car south of an alley immediately in front of a large pile of dirt in the roadway. The Meyers' home was north of the alley between Saunders and Dawes Avenues and on the east side of Twelfth Street. The plaintiff left the lights burning on her car, got out, and walked to her right in a northerly direction. There were no lights in the immediate area other than the car lights. The plaintiff followed what she termed a pathway beyond a bush and observed earth ahead of her. She then suddenly slipped or fell into an excavation, suffering injuries. She was able to get out of the ditch and, although confused, went to the Meyers' home where some dirt was washed off her. She was then assisted back over the ditch by Mr. Meyers and driven in her car by Mr. Meyers to her home. Some time later, she was taken to the Lincoln General Hospital where she received medical treatment. The plaintiff testified that she did not know of the existence of the ditch until she fell in, but later discovered that she was walking over a culvert which crossed the ditch and which was covered at the top with earth approximately the level of the earth on either side of the ditch.
Elmer A. Meyers, a witness for the plaintiff, testified that he lived at 2340 North Twelfth Street in Lincoln on April 19, 1964; that his home was west of Fourteenth Street and north of Oak Creek on the east side of Twelfth Street; that his home was on the north side of an alley; that on April 17 or 18, 1964, the defendant dug a ditch for the purpose of laying a telephone cable across Twelfth Street in an east-west direction; that the ditch was deeper than the height of an average man; that the dirt from the ditch was piled on the south side of the ditch in the middle of Twelfth Street; that Twelfth Street is a graveled road; that on the east side of Twelfth Street there was a pathway across the ditch; that there was no light or barricade placed in the pathway; that a culvert crossed the ditch at a right angle in the middle of the pathway; that dirt covered the culvert; and that this condition existed in the morning hours of April 19, 1964. Exhibit 1, a photograph, shows a view of the route plaintiff walked, and discloses the entire area covered with fresh earth, with evidence of foot travel approaching the ditch and the culvert, with fresh earth partially covering the top at the level of the surrounding ground. Exhibit 2, another photograph, shows a view of the ditch and culvert, indicating a tunneling under the culvert. The witness testified that the conditions shown in the exhibits correctly reflected the situation at the time of the incident in question. He testified that, before he assisted plaintiff to her car, he laid a door across the ditch to enable her to cross it.
On cross-examination, Meyers testified that the construction work on Twelfth Street had started a week before plaintiff's accident; that he recalled barricades and that one was placed in front of the dirt pile in Twelfth Street; and that he saw no other barricades.
Arnold Boettcher testified that he is an employee of the safety division, State of Nebraska, concerned with employee safety; that he inspected the site of the injury on April 20, 1964; that he saw no railing, lights, or barricade at the footpath; that he *799 observed a door that had been used for walking across a ditch; and that he saw no sidewalks in the area.
Arnold Campbell testified that he lived at 2346 W Street and that he was a construction worker; that he visted the area in question about 8:30 a. m. on April 19, 1964; that he observed Twelfth Street, the ditch, a pathway, a metal corrugated culvert across the ditch with dirt on the top of it, but observed no barricades or warning signs along the pathway; and that there were no men or equipment working at the site when he observed it.
The defendant's first assignment of error relates to the trial court's failure to sustain the defendant's motion for a directed verdict, made at the close of plaintiff's case. The defendant asserts that plaintiff failed to prove the defendant negligent, and failed to prove that the negligence of the defendant, if any, was the proximate cause of plaintiff's accident and injuries, that the evidence showed that the plaintiff was guilty of contributory negligence as a matter of law, and that plaintiff voluntarily assumed the risk.
The duty to maintain streets and sidewalks in a reasonably safe condition for travel is remitted during the time occupied in making repairs. Conklin v. Lincoln Traction Co., 130 Neb. 28, 263 N.W. 674.
The defendant was an independent contractor engaged in the installation of an underground telephone cable. The plaintiff does not question defendant's right to excavate in the area nor its right to suspend travel across Twelfth Street.
There is no evidence tending to show that the excavation was constructed in an irregular manner nor that the purpose for which the excavation was made was not reasonable. The plaintiff does assert that the ditch was allowed to remain open an unreasonable length of time. The evidence indicates that the excavation on Twelfth Street was begun on or before April 17 or 18, 1964, and plaintiff's accident happened in the early morning hours of April 19, 1964. No evidence was adduced that the work was not diligently pursued, nor that the work was completed prior to April 19, 1964, so that the ditch could have been filled. Fresh cement was laid in the bottom of the ditch on April 18, 1964.
The plaintiff further contended in the lower court that the negligence of the defendant consisted of leaving the ditch open and exposed across an area where people were accustomed to walk, and in failing to warn travelers of the ditch or erecting a suitable barricade.
The plaintiff does not assert, nor have we discovered, any duty by which the defendant was required to furnish a pathway across the open ditch to the public. The crux of plaintiff's case is to the point that the defendant had knowledge that the general public was using the area on the east side of Twelfth Street across the culvert as a pathway, that the condition was dangerous, and that the defendant failed to warn the public of such danger by the erection of a suitable barricade and lights. Plaintiff introduced no evidence showing the use of the pathway by the public. Defendant's evidence was to the effect that the footprints were made by workmen.
It is the continuing duty of a contractor, engaged in construction work on a public highway, to erect barricades or signs, or otherwise adequately warn the traveling public if the highway is dangerous to travel. Bruno v. Gunnison Contractors, Inc., 176 Neb. 462, 126 N.W.2d 477.
That the defendant placed a barricade in Twelfth Street to warn travelers is not disputed. There were no sidewalks across which to place a barricade. The plaintiff stopped her car at the barricade and saw the large pile of earth on Twelfth Street. She was apprised that travel in the highway was dangerous. In spite of this warning, she walked onto a poorly lighted pathway in an area where no sidewalk existed, at night, with no knowledge of the *800 condition of the pathway. Thereupon, she stepped onto the culvert which crossed the ditch, fell, and was injured. The evidence discloses that plaintiff could have approached the Meyers' house from the north without exposing herself to any hazards.
The plaintiff relies on Kuska v. Nichols Construction Co., 154 Neb. 580, 48 N.W.2d 682. There, the plaintiff, a guest passenger, sued the defendant construction company for personal injuries alleged to have been caused when the car in which she was riding collided with a pile of gravel which the defendant caused to be placed on the highway, without warning of the obstruction or barricading the obstruction. The court held that failure to warn the traveling public that the highway was dangerous to travel, or of obstructions, is continuing negligence as distinguished from a condition. In the instant case, the plaintiff, after having observed a barricade and taken note of the dangerous condition, proceeded into the area of danger. The case is distinguishable on the facts.
The plaintiff also cites King v. Douglas County, 114 Neb. 477, 208 N.W. 120, in which the evidence discloses that during the construction of the Lincoln Highway near Elkhorn, Nebraska, the county maintained a by-pass road. It was established that no barricades or signs were erected to warn the drivers using the by-pass of its dangerous condition or that the road was closed, and that plaintiff's intestate was directed by defendant contractor's employees to use the by-pass. The plaintiff's intestate was killed in an accident thereon. The court held that the county was liable by reason of the unsafe condition of the by-pass.
The plaintiff also relies on Simonsen v. Thorin, 120 Neb. 684, 234 N.W. 628, 81 A. L.R. 1000, a case in which the defendants, without fault in the operation of a truck, struck a trolley pole and knocked it into the street, obstructing the street. The plaintiff, a passenger in a car, brought suit for personal injuries sustained when the car in which she was riding collided with the pole in the street. The court held that the negligence of the defendants consisted not in having placed an obstruction in a public highway but in failing to either remove the obstruction or to warn the traffic on the highway of the dangers incident to the obstruction. The cases are distinguishable on their respective facts.
Plaintiff further relies on Village of Ponca v. Crawford, 23 Neb. 662, 37 N.W. 609, 8 Am. St. Rep. 144, and City of Beatrice v. Forbes, 74 Neb. 125, 103 N.W. 1069, for the proposition that contributory negligence, as a matter of law, is not imputed to a traveler from the mere fact that he attempts to pass over a street that is obstructed or out of repair, provided that the obstruction or other defect is such that a man of ordinary intelligence would reasonably believe that, with proper caution and care, he could pass with safety notwithstanding the defect. In each of these cases, the condition was discovered and known. In the instant case, the plaintiff, with warning of danger and without knowledge of the condition of the path, disregarded both warning and lack of knowledge.
The obligation of the defendant was to warn the traveling public of obstructions in the highway. The plaintiff, by her own acts, placed herself in a position where injury could reasonably be expected to occur, after disregarding a warning of danger.
We do not say that the defendant, or other persons similarly situated, is relieved from the duty of warning the public of a dangerous crossing of an excavation where evidence is introduced showing or tending to show that the path was used by the public with actual knowledge by the defendant, or under circumstances tending to show that the use by the public should have been known to the defendant.
We conclude that the plaintiff was contributorily negligent as a matter of law, that such negligence was more than slight, *801 and that the trial court erred in failing to dismiss the plaintiff's petition.
The defendant raises other assignments of error, but it is not necessary to discuss them.
Reversed and dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581231/ | 919 F.Supp. 1091 (1995)
LUXOTTICA GROUP S.p.A., et al., Plaintiffs,
v.
The UNITED STATES SHOE CORPORATION, et al., Defendants.
No. C2-95-244.
United States District Court, S.D. Ohio, Eastern Division.
March 22, 1995.
Thomas Brennan Ridgley and Laura G. Kuykendall, Vorys, Sater, Seymour & Pease, Columbus, Ohio, for Plaintiffs.
Joseph J. Dehner, Frederick J. McGavran and Adam P. Hall, Frost & Jacobs, Cincinnati, Ohio, and Michael Karl Yarbrough, Frost & Jacobs, Columbus, Ohio, for Defendant, United States Shoe Corp.
Samuel H. Simon and Daniel Allen Malkoff, Ohio Attorney General, Columbus, Ohio, for Defendant, State of Ohio.
*1092 OPINION AND ORDER
GRAHAM, District Judge.
This matter is before the Court on the motion of plaintiff Avant-Garde Optics, Inc. ("Avant-Garde") for a hearing and an order requiring the defendant United States Shoe Corporation ("U.S. Shoe") to show cause why an order should not be entered directing it to provide shareholder records.
Avant-Garde is a subsidiary corporation of Luxottica Group S.p.A. and a record shareholder of U.S. Shoe. On March 7, 1995, Avant-Garde delivered a written demand to U.S. Shoe to inspect and copy shareholder records. On March 10, 1995, U.S. Shoe responded by refusing plaintiff's request for access to shareholder records on the ground, among others, that plaintiff's request must comply with the proxy rules of the Securities and Exchange Commission ("SEC"). Subsequently, on March 16, 1995, Avant-Garde and U.S. Shoe entered into an agreement regarding each of plaintiff's requests in its letter of March 7th with the exception of part "G" of that letter. (Hearing, March 16, 1995). Part "G" of plaintiff's letter requests that U.S. Shoe provide "a list or lists and a magnetic computer tape containing names, addresses, and number of shares of non-objecting beneficial owners of shares." (Plaintiff's exhibit A). In an oral hearing before this Court, defendant stated that it did not possess this information and plaintiff does not dispute this fact. (Hearing, March 16, 1995).
In general, a corporation's shareholder records will not reflect the names or addresses of the beneficial owners but will instead list the names of nominees used by depository firms. The Depository Trust Co. uses "Cede & Co." as the name of the nominee for shares it holds for brokerage firms or financial institutions, who in turn have purchased shares on behalf their customers (beneficial owners). See Sadler v. NCR Corporation, 928 F.2d 48, 50 (2nd Cir.1991). Thus, the name Cede & Co. appearing on the corporate stock ledger is "thrice removed from the true beneficial owner." RB Associates of New Jersey v. Gillette Company, Civ.A. No. 9711, 1988 WL 27731, (Del.Ch.1988). The list of non-objecting beneficial owners ("NOBO list") contains the names of those shareholders who do not object to the disclosure of their name and address by the registered owner of the stock to the corporation itself for the limited purpose of facilitating direct communication on corporate matters. Id. Under SEC regulations, brokers and other record holders of stock in street name must compile a NOBO list at a corporation's request within five business days. 17 C.F.R. § 240.14b-1(b)(3)(i) (1994); Sadler, 928 F.2d at 50.
A shareholder's right to inspect and copy the shareholder records of an Ohio corporation is governed by Ohio Revised Code § 1701.37. This statute provides:
(C) Any shareholder of the corporation, upon written demand stating the specific purpose ... shall have the right to examine in person or by agent or attorney at any reasonable time and for any reasonable and proper purpose ... records of shareholders ... if any, on file with the corporation, and to make copies or extracts thereof. (Emphasis added)
R.C. § 1701.37(C).
Avant-Garde has stated that its purpose for requesting the NOBO list is:
to "facilitate communications with other shareholders of the Company regarding the affairs of the Company and matters relating to their interests as shareholders, including (i) Luxottica Acquisition Corp.'s cash tender offer ... (ii) communications with other shareholders regarding a meeting ... under § 1701.831 ... and (iii) communications with other shareholders regarding solicitations of requests, consents and/or proxies."
(Plaintiff's exhibit A). Plaintiff argues that R.C. § 1701.37 imposes an obligation upon defendant to produce the NOBO list of U.S. Shoe shareholders. To support this contention, plaintiff relies on the Second Circuit's decision in Sadler v. NCR Corporation, supra, which held that an out-of-state corporation may be required to compile and produce a NOBO list. The New York statute at issue in that case permitted a resident, who is a record stockholder of a foreign corporation doing business in New York, to require the *1093 corporation to produce a record of the names and addresses of all shareholders, the number and class of shares held by each and the date when they respectively became the owners of record. Sadler 928 F.2d at 50-51; N.Y. CLS Bus. Corp. § 1315. The court based its holding on a finding that New York courts had liberally construed this statute to facilitate communication among shareholders on issues concerning corporate matters. Id. at 52.
Since the plaintiff's request in its letter of March 7th is based upon R.C. § 1701.37, Ohio law is controlling in this case. Unlike the courts in New York, Ohio courts have not ruled on the question of whether R.C. § 1701.37 should be liberally or narrowly construed. Thus, this Court must predict how the state's highest court would resolve this issue. See Cenergy Corp. v. Bryson Oil & Gas P.L.C., 662 F.Supp. 1144, 1145 (D.Nev.1987) (court refused to compel corporation to compile and produce shareholder information not in its possession). The plain language of the Ohio statute states that a shareholder may inspect and make copies of shareholder records "if any, on file with the corporation." It contains language not present in the New York statute, which suggests that its drafters intended it to be narrowly construed not to require a corporation to provide information it does not have in its possession. In RB Associates v. Gillette, supra, Chancellor Allen, in a thorough analysis of this subject, stated:
Once an issuer has acquired that additional information ... it has an obligation to disclose it to a shareholder as part of the production of a stock list. But where it has not done so, the ideal of equality of access to information concerning identity of shareholders ought not, in my opinion, go so far as to compel the directors to exercise a judgment to obtain NOBO lists when the corporation itself has no need for them and thus no intention to obtain them.
1988 WL 27731, at *6. This Court agrees. As previously stated, U.S. Shoe does not possess the NOBO list requested by plaintiff. If U.S. Shoe possessed the NOBO list, Avant-Garde would have the right to examine it under the terms of the Ohio statute since it would then be "records of shareholders ... on file with the corporation." However, since defendant does not possess it, this Court, like the courts in RB Associates and Cenergy, will not compel U.S. Shoe to compile and produce this information.
Accordingly, this Court concludes that in the event that defendant obtains a copy of the NOBO list requested in part "G" of plaintiff's March 7th letter, it shall notify the plaintiff promptly and shall permit the plaintiff to inspect and copy it. Otherwise, plaintiff's motion to require defendant to procure and produce a NOBO list is denied.
It is so ORDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581234/ | 919 F.Supp. 70 (1995)
David A. DeLEO
v.
CITY OF STAMFORD.
No. 592CV80 (EBB).
United States District Court, D. Connecticut.
March 14, 1995.
*71 Gary Edward Phelan, Lewis H. Chimes, Garrison, Phelan, Levin-Epstein & Penzel, New Haven, CT, for Plaintiff.
Charles A. DeLuca, Michael Gene Clear, Rosemarie Chapdelaine, Ryan, Ryan, Johnson, Clear & DeLuca, Stamford, CT, Richard Allan Robinson, Corporation Counsel, City of Stamford, Stamford, CT, for Defendant.
RULING ON MOTION TO STRIKE
ELLEN B. BURNS, Senior District Judge.
Plaintiff David DeLeo brings this action against the City of Stamford alleging discriminatory treatment on the basis of disability in violation of the Rehabilitation Act of 1973, as amended, 29 U.S.C. § 792 et. seq. He demands a jury trial and seeks reinstatement, back pay, compensatory and punitive damages, costs and attorney's fees. The defendant moves to strike the demand for a jury trial as well as the claims for compensatory and punitive damages. For the reasons set forth below, the motion to strike is denied in part with prejudice and denied in part without prejudice.
BACKGROUND
On or about March 30, 1988, Mr. DeLeo applied for a position as a police officer in the Stamford Police Department. P.Compl. ¶ 5. In January, 1989, the Stamford Personnel Department notified Mr. Deleo that his application had been rejected. When Mr. DeLeo appealed the rejection, he learned that he was given a "remedial medical disqualification" because of poor reading and written language skills.[1] He also learned that the remedial disqualification would become a permanent disqualification if not corrected within six months. P.Compl. ¶¶ 7-8.
Mr. DeLeo thereafter enrolled in six months of educational training in reading at Housatonic Community College. P.Compl. ¶ 10. In August, 1989, Dr. Robert D. Meier, a licensed psychologist hired by the Stamford Police Department, re-evaluated Mr. DeLeo. He noted improvement in Mr. DeLeo's reading abilities and recommended entrance to the police academy despite reservations as to whether Mr. DeLeo would be able to complete the training requirements successfully. P.Compl. ¶¶ 10-11. In January, 1990, Mr. DeLeo was appointed to the Stamford Police Department. P.Compl. ¶ 12.
Despite Dr. Meier's reservations, Mr. DeLeo completed the requirements of the Basic Training Academy within six months of his appointment. To accommodate his disability, Mr. DeLeo purchased and used a laptop computer and spell-check machine. He received an "average" performance rating for his first performance appraisal in August, 1990. P.Compl. ¶¶ 13-14. Nevertheless, on January 9, 1991, Chief of Police George W. Mayer recommended that Mr. DeLeo be fired for unsatisfactory performance during his probationary period. P.Compl. ¶ 15.
On February 4, 1991, the Stamford Police Commission held a hearing at police headquarters to address Chief Mayer's recommendation. The hearing was continued and completed on March 18, 1991. P.Compl. ¶ 16. At the February 4, 1991 meeting, head of training Richard Priola stated that the Department was not willing to provide the "extraordinary" accommodations of special *72 classes for learning disabilities or high school review classes. P.Compl. ¶ 19. Deputy Chief Walter Young stated that it "would not be practical or realistic for him to carry [a laptop computer and a spellcheck machine] around with him as he answers call [sic] for service and deals with the public." P.Compl. ¶ 22. At the March 18, 1991 hearing, Sergeant Robert Lapiano reviewed Mr. DeLeo's written reports and stated that they were "somewhere in the middle." Sergeant Roger Petrone, Mr. DeLeo's supervisor for the last five to six months of employment, rated Mr. DeLeo's performance in general as "way above average" and his reports in particular as "average." P.Compl. ¶ 21. At the end of the hearing, the Commission members voted 2-1 to uphold the plaintiff's termination. P.Compl. ¶ 17.
DISCUSSION
I. Compensatory and Punitive Damages
The plaintiff seeks compensatory and punitive damages for the alleged discrimination by the Stamford Police Department. The defendant argues that the claims for compensatory and punitive damages should be stricken from the complaint because the Rehabilitation Act does not authorize such damages. Although the Rehabilitation Act does not specifically provide for compensatory or punitive damages, the court concludes that based on the Supreme Court's recent decision in Franklin v. Gwinnett County Public Sch., 503 U.S. 60, 112 S.Ct. 1028, 117 L.Ed.2d 208 (1992), the full panoply of remedies is available for intentional violations of the Act.
The Rehabilitation Act of 1973 prohibits federally funded programs from discriminating on the basis of disability. 29 U.S.C. § 794 (1988 & Supp.1990). More specifically, § 504 of the Act provides:
No otherwise qualified individual with handicaps in the United States, as defined in section 706(8) of this title, shall, solely by reason of his or her handicap, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving Federal financial assistance....
29 U.S.C. § 794. It is well-established that § 504 creates a private right of action. See Conrail v. Darrone, 465 U.S. 624, 630 n. 7, 104 S.Ct. 1248, 1252 n. 7, 79 L.Ed.2d 568 (1984).
In 1978 Congress amended the Rehabilitation Act to establish the remedies available for violations of § 504. 29 U.S.C. § 794a. More specifically, § 505 of the Act provides:
The remedies, procedures and rights set forth in Title VI of the Civil Rights Act of 1964 [42 U.S.C. § 2000d et seq.] shall be available to any person aggrieved by any act or failure to act by any recipient of Federal assistance or Federal provider of such assistance under section 794 of this title.
29 U.S.C. § 794a(a)(2). Title VI, however, does not indicate what remedies are available for violations of that statute. 42 U.S.C. § 2000d et seq. Consequently, courts have been divided about the scope of available remedies under both Title VI and the Rehabilitation Act. Justice v. Pendleton Place Apartments, 40 F.3d 139 (6th Cir.) (citing Miener v. Missouri, 673 F.2d 969 (8th Cir.), cert. denied, 459 U.S. 909, 103 S.Ct. 215, 74 L.Ed.2d 171 (1982) and Eastman v. Virginia Polytechnic Inst. & State University, 939 F.2d 204 (4th Cir.1991)).
However, the Supreme Court's recent decision in Franklin now provides the dispositive analysis for determining what remedies are available under the Rehabilitation Act. In Franklin, the Supreme Court reaffirmed the longstanding principle that "[w]here legal rights have been invaded, and a federal statute provides for a general right to sue for such invasion, federal courts may use any available remedy to make good the wrong done." Franklin, 503 U.S. at 66, 112 S.Ct. at 1033 (quoting Bell v. Hood, 327 U.S. 678, 684, 66 S.Ct. 773, 777, 90 L.Ed. 939 (1946)).
This presumption in favor of the full panoply of remedies applies to express and implied causes of action alike. Id. at 70, 112 S.Ct. at 1035. In other words, "`the question whether a litigant has a `cause of action' is analytically distinct and prior to the question of what relief, if any, a litigant may be entitled to receive.'" Id. at 68, 112 S.Ct. at 1034 (quoting Davis v. Passman, 442 U.S. *73 228, 239, 99 S.Ct. 2264, 2274, 60 L.Ed.2d 846 (1979)). While "we look to indicia of Congress' intent to bestow a private cause of action" in determining whether a statute confers a private right of action, once "an implied right of action emerges, ... we presume absent clear congressional direction to the contrary that `the federal courts have the power to award any appropriate relief.'" Health Care Plan, Inc. v. Aetna Life Ins. Co., 966 F.2d 738, 742 (2d Cir.1992) (citing Franklin, 503 U.S. at 70, 112 S.Ct. at 1035) [sic]. Thus, the relevant question is not whether the statute demonstrates Congressional intent to authorize a specific remedy, but whether it demonstrates Congressional intent to limit the traditional presumption in favor of any available remedy. See Franklin, 503 U.S. at 71, 112 S.Ct. at 1036; see also Miller v. Spicer, 822 F.Supp. 158, 167 (D.Del.1993); Justice, 40 F.3d at 142.
In Franklin, the Court held that money damages are available for intentional violations of Title IX. The Court reasoned that because Congress enacted Title IX and its amendments[2] in full cognizance of the traditional presumption in favor of all remedies and did nothing to restrict this presumption, damages were an available remedy for violations of Title IX. Franklin, 503 U.S. at 70-75, 112 S.Ct. at 1035-37; see also Spicer, 822 F.Supp. at 168.
The Franklin decision is significant in two respects. First, because of the relationship among Title IX, Title VI and § 504, the Supreme Court's determination that money damages are available under Title IX is dispositive of whether money damages are available under § 504. Second, the analysis developed in Franklin governs the inquiry under the Rehabilitation Act as well and inescapably leads to the conclusion that both compensatory[3] and punitive[4] damages are available under the Rehabilitation Act. Franklin, 503 U.S. at 64-77, 112 S.Ct. at 1032-38.
Section 504 of the Rehabilitation Act is virtually identical to Title IX, "with the principal *74 exception being the class protected. As a result, the Franklin court repeatedly analogized the two statutes." Waldrop, 24 F.3d at 157 n. 5 (11th Cir.1994) (citing Franklin, 503 U.S. at 70, 112 S.Ct. at 1035).[5] Additionally, "it is well-established that Congress intended the same remedies be available under Title IX and Title VI." Id. (citing Guardians Assn. v. Civil Service Comm'n., 463 U.S. 582, 594, 103 S.Ct. 3221, 3228, 77 L.Ed.2d 866 (1983) (White, J., plurality)). Moreover, the Court in Franklin pointed out that in Guardians, "a clear majority expressed the view that damages were available under Title VI ...." Franklin, 503 U.S. at 70, 112 S.Ct. at 1035. (citations omitted). Thus, Franklin authorizes damages not only for Title IX, but Title VI cases as well. Because Title VI remedies are also available to § 504 litigants, Franklin must be read to authorize damage awards under § 504 also.
More significantly, the traditional presumption in favor of all appropriate remedies applies with equal force to the Rehabilitation Act. As Congress enacted both § 504 of the Rehabilitation Act and the amendments thereto[6] in full cognizance of this traditional presumption, without demonstrating its intent to limit the presumption in any way, the full panoply of remedies, including compensatory and punitive damages, must be available for violations of § 504.
Although Franklin did not address specifically the availability of punitive damages under Title IX, there is no adequate basis, in the Franklin opinion or elsewhere, for exempting punitive damages from the full spectrum of remedies generally available for violation of a federal statute such as Title IX or the Rehabilitation Act. First, punitive damages doctrine has been accepted as "settled law by nearly all state and federal courts, including [the Supreme Court]," for more than a century. Smith v. Wade, 461 U.S. 30, 35, 103 S.Ct. 1625, 1629, 75 L.Ed.2d 632 (1983) (citations omitted). Moreover, a majority of the Supreme Court has already rejected the proposition that Congress "acted expressly when it intended to approve punitive damages." Id. at 35 n. 5, 103 S.Ct. at 1629 n. 5. Finally, the "appropriateness" of punitive damages depends on the intent of the defendant in each case, a determination that "rests in the discretion of the ... trier of fact." 22 Am.Jur.2d § 739.
Thus, punitive damages are included within the full panoply of remedies and must be available for a violation of the Rehabilitation Act "absent clear direction to the contrary by Congress." Franklin, 503 U.S. at 70, 112 S.Ct. at 1035; see also Fitzgerald v. Green Valley Area Educ. Agency, 589 F.Supp. 1130, 1138 (S.D.Iowa 1984) (concluding that a full spectrum of remedies presumably includes punitive damages). Because the court does not find "clear direction" by Congress to limit the remedies available under the Rehabilitation Act, the motion to strike the claims for compensatory and punitive damages is denied.[7]
*75 II. Jury Trial
The plaintiff demands a jury trial for his § 504 claim. The defendant argues that the demand for a jury trial should be stricken from the complaint because the Rehabilitation Act does not authorize a jury trial and the Seventh Amendment does not require it.
In determining whether a plaintiff is entitled to a jury trial in a case arising under federal legislation, a court must first look to the statute. If the statute is silent regarding the right to a jury trial, the court must inquire whether the Seventh Amendment constitutionally mandates the right to a jury trial. Waldrop, 24 F.3d at 155 (citing Tull v. United States, 481 U.S. 412, 417 n. 3, 107 S.Ct. 1831, 1835 n. 3, 95 L.Ed.2d 365 (1987); Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 558, 564 n. 3, 110 S.Ct. 1339, 1344 n. 3, 108 L.Ed.2d 519 (1990)).
The Seventh Amendment preserves a right to a jury trial "in Suits at common law, where the value in controversy exceeds twenty dollars." The phrase "Suits at common law" has been interpreted to encompass legal rights and remedies that are "enforceable in an action for damages in the ordinary courts of law." Curtis v. Loether, 415 U.S. 189, 194, 94 S.Ct. 1005, 1008, 39 L.Ed.2d 260 (1974).
The Supreme Court has developed a two-pronged inquiry, examining both the nature of the suit and the remedy sought, to determine whether a suit is one "at common law" for purposes of the Seventh Amendment. Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 558, 565, 110 S.Ct. 1339, 1344, 108 L.Ed.2d 519 (1990). "First, we compare the statutory action to 18th-century actions brought in the courts of *76 England prior to the merger of the courts of law and equity. Second, we examine the remedy sought and determine whether it is legal or equitable in nature." Id. (quoting Tull v. United States, 481 U.S. 412, 417, 107 S.Ct. 1831, 1835, 95 L.Ed.2d 365 (1987)). The second inquiry is the more critical of the two. Id. (citing Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 42, 109 S.Ct. 2782, 2790, 106 L.Ed.2d 26 (1989)).
The Rehabilitation Act of 1973 doe not indicate on its face what procedures are available to litigants. 29 U.S.C. § 794. Rather, as in the case of remedies, it borrows the procedures and rights of Title VI. 29 U.S.C. § 794(a). However, because neither § 504 nor Title VI provide any guidance as to the availability of a jury trial, the court must determine, under the two-pronged test set out by the Supreme Court, whether a jury trial is constitutionally required under the Seventh Amendment.
First, actions under § 504 of the Rehabilitation Act are comparable to actions brought before courts of law in 18th-century England namely, an action in tort to redress discrimination and an action for breach of an employment contract. Waldrop, 24 F.3d at 156 (citing Curtis, 415 U.S. at 196 n. 110, 94 S.Ct. at 1009 n. 110 ("An action to redress racial discrimination may also be likened to an action for defamation or intentional infliction of mental distress.")). Second, and more importantly, actions under § 504 allow plaintiffs the full spectrum of equitable and legal remedies. See Franklin, 503 U.S. 60, 112 S.Ct. 1028, 117 L.Ed.2d 208. Thus, the Seventh Amendment preserves the right to a jury trial in appropriate § 504 cases.
Because the plaintiff in this case seeks compensatory and punitive damages, or legal relief, the Seventh Amendment preserves the right to a jury trial. Therefore, the motion to strike the demand for a jury trial is denied.
CONCLUSION
For the foregoing reasons, the motion to strike the claim for compensatory damages [Doc. No. 33] is denied with prejudice. The motion to strike the claim for punitive damages [Doc. No. 33] is denied without prejudice. The motion to strike the demand for a jury trial [Doc. No. 33] is denied with prejudice.
SO ORDERED.
NOTES
[1] Mr. DeLeo claims that he is dyslexic, that his dyslexia substantially limits his ability to read and write, and that this limitation renders him "disabled" under 29 U.S.C. 706(8).
[2] The Civil Rights Remedies Equalization Amendment of 1986 abrogated the States' Eleventh Amendment immunity and provided that, in a suit against a State, "remedies (including remedies both at law and in equity) are available for [violations of Title IX] to the same extent as such remedies are available for such a violation in a suit against any public or private entity other than a State." 42 U.S.C. § 2000d-7(a)(2). Through this amendment, Congress implicitly acknowledged that money damages are available under Title IX. Franklin, 503 U.S. at 78, 112 S.Ct. at 1039 (Scalia, J., concurring). In addition, the Civil Rights Restoration Act of 1987 broadened the coverage of Title IX's antidiscrimination provision. Id. at 70, 112 S.Ct. at 1035 (citing Pub.L. 100-259, 102 Stat. 28 (1988)). Although this Act corrected an evidently unacceptable decision in Grove City College v. Bell, 465 U.S. 555, 104 S.Ct. 1211, 79 L.Ed.2d 516 (1984), it did not restrict the implied right of action recognized in Cannon v. University of Chicago, 441 U.S. 677, 99 S.Ct. 1946, 60 L.Ed.2d 560 (1979) or in any way alter the traditional presumption in favor of all appropriate remedies. Id. Thus, nothing in the history of Title IX acted as "clear direction" by Congress to limit the available remedies for a violation of that Act.
[3] Nearly every court that has addressed this issue following Franklin has determined that compensatory damages are available under § 504. Rodgers v. Magnet Cove Pub. Schs., 34 F.3d 642, 644-45 (8th Cir.1994); Waldrop v. Southern Co. Servs., 24 F.3d 152, 156-57 (1994); Pandazides v. Virginia Bd. of Educ., 13 F.3d 823, 829-32 (4th Cir.1994); see Howe v. Hull, 873 F.Supp. 72, 74 (N.D.Ohio); Kedra v. Nazareth Hospital, 868 F.Supp. 733, 737-739 (E.D.Pa.); Spicer, 822 F.Supp. at 166-68; Kuntz v. City of New Haven, 1993 WL 276946 *2 (D.Conn.); Ali v. City of Clearwater, 807 F.Supp. 701, 704-05 (M.D.Fla. 1992); Kraft v. Memorial Medical Center, Inc., 807 F.Supp. 785, 791 (S.D.Ga.1992); Doe v. District of Columbia, 796 F.Supp. 559, 571-73 (D.D.C.1992); Tanberg v. Weld County Sheriff, 787 F.Supp. 970, 972-74 (D.Col.1992); but see Tyler v. Manhattan, 849 F.Supp. 1442 (D.Kan.) (relying on several pre-Franklin cases to hold that compensatory damages are not available and distinguishing Franklin on the basis of the intentional discrimination alleged in Franklin); U.S. v. Forest Dale, Inc., 818 F.Supp. 954, 970 (N.D.Tex.1993) (relying on a pre-Franklin case, Shinault v. American Airlines, Inc., 738 F.Supp. 193, 198-99 (S.D.Miss.1990), aff'd. in part, rev'd in part, 936 F.2d 796 (5th Cir.1991) to hold that § 504 damages are limited to retrospective equitable damages).
[4] Two courts that have addressed the availability of punitive damages under the Rehabilitation Act following Franklin have authorized punitive damages. See Howe, 1994 WL 682951 at *1; Kedra, 868 F.Supp. at 740; but see Williams v. Express Airlines I, Inc., 1993 WL 246228 *1 (W.D.Tenn.) (citing a pre-Franklin case, Gelman v. Department of Education, 544 F.Supp. 651, 654 (D.Colo.1982), to support the determination that the Rehabilitation Act does not allow punitive damages).
[5] Title IX provides, in pertinent part: "No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving federal financial assistance." 20 U.S.C. § 1681(a).
[6] The Civil Rights Remedies Equalization Amendment of 1986 and the Civil Rights Restoration Act of 1987, see supra n. 2, also amended § 504 of the Rehabilitation Act. Franklin, 503 U.S. at 71, 112 S.Ct. at 1036.
[7] The court recognizes that several factors weigh in favor of implying limitations upon the remedial scope of the Rehabilitation Act. See Franklin, 503 U.S. at 77, 112 S.Ct. at 1039 (Scalia, J., concurring). First, the principle relied on in Franklin, dating back to Marbury v. Madison, 5 U.S. (1 Cranch) 137, 2 L.Ed. 60 (1803), is a remedial principle. See Marbury, 5 U.S. at 163 (arguing that, under a government of laws, the law must furnish a "remedy for the violation of a vested legal right"); Bell v. Hood, 327 U.S. 678, 684, 66 S.Ct. 773, 777, 90 L.Ed. 939 (1946) (stating that "where legal rights have been invaded, ... federal courts may use any available remedy to make good the wrong done"). The purpose of punitive damages, however, is not to compensate but to punish and deter. Day v. Woodworth, 54 U.S. (13 How.) 363, 371, 14 L.Ed. 181 (1852) ("[T]he question will not admit of argument."). Second, although Congress did not specifically prohibit punitive damages under the Rehabilitation Act, it did establish what many would consider a punitive remedial scheme that is, the termination of federal funding for violations of the Act. See Turner v. First Hospital Corp., 772 F.Supp. 284, 287 n. 2 (E.D.Va.1991) (arguing that punitive damages are inappropriate under Spending Clause legislation because "the most appropriate form of punishment to a discriminating employer is the termination of its federal funding and not an award of punitive relief to a private litigant").
Third, in amending the Rehabilitation Act to authorize Title VI remedies for § 504 litigants, Congress, at least in some respects, transformed § 504 from a "general right to sue" statute to one with a "set of `circumscribed remedies.'" See Landgraf v. USI Film Prods., ___ U.S. ___, ___ n. 38, 114 S.Ct. 1483, 1508 n. 38, 128 L.Ed.2d 229 (1994) (explaining why the traditional presumption in favor of all appropriate remedies does not apply to Title VII). In other words, although Title VI did not specify what remedies were available for violations of that statute, the amendment to the Rehabilitation Act may be interpreted as authorizing those judicially accepted Title VI remedies.
Finally, the Civil Rights Act of 1991 amended 29 U.S.C. § 794a(a)(1) to provide a limited right to compensatory and punitive damages for intentional employment discrimination against the disabled. 42 U.S.C. § 1981a(a)(2)-(3); see also Tyler, 849 F.Supp. 1442. Because the Civil Rights Act of 1991 has been interpreted as expanding significantly the monetary relief available to victims of employment discrimination, see Landgraf, ___ U.S. at ___, 114 S.Ct. at 1491, it seems paradoxical to interpret the Rehabilitation Act as authorizing an unlimited right to compensatory and punitive damages.
Nevertheless, this court is constrained by the broad language of the Supreme Court in Franklin. First, as noted above, the Franklin opinion does not provide any basis to exempt punitive damages from the full spectrum of remedies generally available in such tort-like causes of action. See Smith v. Wade, 461 U.S. at 47-49, 103 S.Ct. at 1636-37. Second, the majority in Franklin did not accept the concept of judicially implied limitations on the remedial scope of statutes such as the Rehabilitation Act. See Franklin, 503 U.S. at 77, 112 S.Ct. at 1039 (Scalia, J., concurring). Rather, it made clear that the traditional presumption in favor of all available remedies applies "absent clear direction to the contrary by Congress." Id. at 70, 112 S.Ct. at 1035.
The provision for termination of federal funding for violations of the Rehabilitation Act cannot be interpreted as clear direction from Congress to prohibit punitive damages or to "abandon the traditional presumption in favor of all available remedies." Id.; see also id. at 73, 112 S.Ct. at 1037. Similarly, the amendment making Title VI remedies available to § 504 litigants cannot be interpreted as clear direction from Congress when Title VI does not specify what remedies are available for violations of that statute. Although case law had developed, the breadth of damages under Title VI was not settled. See Rivera Flores v. Puerto Rico Telephone Co., 776 F.Supp. 61, 63 (D. Puerto Rico 1991); see also Note, Safeguarding Equality for the Handicapped: Compensatory Relief under Section 504 of the Rehabilitation Act, 1986 Duke L.J. 197. Because "we cannot safely infer anything about congressional intent from the divided contemporaneous judicial opinions," Smith v. Wade, 461 U.S. at 93, 103 S.Ct. at 1659 (O'Connor, J., dissenting), we cannot interpret § 505 as clear congressional intent to alter the traditional presumption in favor of all available relief. Finally, although the Civil Rights Act of 1991 amends the Rehabilitation Act along with the Americans with Disabilities Act, the Civil Rights Act does not apply retroactively. See Landgraf, ___ U.S. ___, 114 S.Ct. 1483, 128 L.Ed.2d 229. Thus, the full spectrum of remedies, including punitive damages, must apply without limitation in this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581235/ | 147 N.W.2d 879 (1967)
Opal Irene MAIKOS, Appellee,
v.
John J. MAIKOS, Appellant.
No. 52310.
Supreme Court of Iowa.
January 10, 1967.
*880 Neiman, Neiman & Stone, Des Moines, for appellant.
James D. McKeon, Des Moines, for appellee.
LARSON, Justice.
On August 6, 1960, the district court of Polk County, Iowa, granted appellee, Opal Irene Maikos, a divorce from appellant, John J. Maikos, and, in accordance with the prayer of her amended petition and a stipulation signed by her, awarded custody of their two children, Jeffrey Paul, born March 22, 1956, and Susan Teresa, born April 13, 1958, to the appellant, who then resided in Bridgeport, Connecticut. On July 2, 1962, appellee filed an application to modify the divorce decree, but no hearing thereon was had until December 15, 1965. Pursuant to the order of January 6, 1966, modifying the decree changing custody of the children and granting appellee $20.00 per week child support, the father appeals.
Appellant contends that under the law and the facts the trial court was in error in granting this application and that its order and judgment should be reversed. We agree.
I. This proceeding being in equity, our review is de novo. Burrell v. *881 Burrell, 256 Iowa 490, 127 N.W.2d 78; Rule 334, Rules of Civil Procedure. We, of course, give weight to the trial court's findings, but are not bound thereby. Rule 344(f) 7, R.C.P.
II. The provisions of a divorce decree as to custody of minor children are final as to the circumstances then existing, and they may be modified only where it is proven by a preponderance of the evidence that subsequent conditions have so changed that the welfare of the children requires such modification. Section 598.14, Code of 1962; Burrell v. Burrell, supra; Heater v. Heater, 254 Iowa 586, 118 N.W.2d 587; Simpkins v. Simpkins, 256 Iowa 989, 129 N.W.2d 723; Welch v. Welch, 256 Iowa 1020, 129 N.W.2d 642; Herron v. Herron, 258 Iowa 1052, 141 N.W.2d 562.
III. The burden to prove such a change is required is upon the applicant. Heater v. Heater, supra; Herron v. Herron, supra; Welch v. Welch, supra; Pearson v. Pearson, 247 Iowa 437, 74 N.W.2d 224.
Not every change in circumstances is considered sufficient for a modification unless its enforcement be attended by positive wrong or injustice as a result of the changed conditions. Beyerink v. Beyerink, 240 Iowa 45, 35 N.W.2d 458; Dow v. Dow, 240 Iowa 145, 35 N.W.2d 853; Heater v. Heater, supra; Smith v. Smith, 257 Iowa 584, 133 N.W.2d 677.
IV. The changed circumstances must also be such as were not within the knowledge or contemplation of the trial court at the time of the original decree. Brott v. Brott, 257 Iowa 377, 131 N.W.2d 829; Pearson v. Pearson, supra; Simpkins v. Simpkins, supra. And the prior decree necessarily determined the fitness of the party to whom the children are awarded at that time, and as to the circumstances then existing. Dow v. Dow, supra; Huston v. Huston, 255 Iowa 543, 122 N.W.2d 892; Smith v. Smith, supra; Welch v. Welch, supra. It has been held that, where the children have been so placed and where they are receiving good treatment and moral training, they should not be removed therefrom, except for the most cogent reasons. Jensen v. Jensen, 237 Iowa 1323, 1332, 25 N.W.2d 316.
V. These propositions are well settled and established in this jurisdiction. In fact, both parties cite and rely upon the same authorities. Their application to the evidence at hand is often, as here, a very difficult problem. Each case must be considered upon the record presented, and a careful review thereof is called for here. Being aware of the trial court's advantage in seeing and hearing the witnesses, the basis of the error, if any, should be more or less apparent. That seems to be the case here.
We note in its findings of fact: "4. The court finds that at the time of the rendition of the original decree that the defendant was employed and capable of providing for the wants of the minor children, but that the plaintiff was destitute and emotionally out of control, and that the children were physically in the State of Connecticut, the defendant having removed them from the State of Iowa prior to the filing of the divorce action. 5. That in November of 1964 the present wife of the defendant found herself in domestic difficulties with the defendant, and did leave her husband, returning to the State of Iowa and this jurisdiction with the two minor children, Jeffrey and Susan, and did abandon them here by leaving them with the plaintiff, in whose custody they have remained to the present time."
Appellant vigorously denies there is sufficient evidence in the record to sustain such findings in paragraph 5, and in fact the record clearly shows that, without his knowledge or consent, his present wife and these children were abducted from his home in Connecticut by her father, brought to the State of Iowa and, over the objections of his present wife, these two children *882 were surrendered to the appellee. He also states that the record evidence will not support paragraph 7 of the findings, "That to deny the application would restore the children into a home and under the control of the present wife of the defendant, who has already on one occasion abandoned them." (Emphasis supplied.) We shall presently review this evidence, but first we should review the record chronologically.
VI. The parties were married in West Des Moines, Iowa, on September 25, 1954, and lived in Des Moines until February of 1955 when they moved to Bridgeport, Connecticut, where these two children were born. In May 1959 the parties came to Des Moines either for a visit or to obtain employment. On June 12, 1959, after a family squabble, the father took the children and returned to Bridgeport, where they resided until November of 1964.
On June 8, 1959, appellee filed her petition for divorce in Polk County, Iowa, but had some delay in getting service on appellant, and the divorce was not granted until August 6, 1960. In that period she had experienced some personal difficulties and it appeared she was unable, physically or mentally, to care for the small children, the boy then being three years old and the girl a little over a year old. She amended her petition to ask that the father be awarded the children's care and custody, and signed a stipulation to that effect. Thereafter, the divorce decree was granted and the court, being fully advised, awarded the care and custody of Jeffrey and Susan to the father.
Subsequently both parties remarried. Appellee has a child by her second marriage. Appellant has two children by his second marriage, and prior to November 1964 this family resided in an apartment in Bridgeport. Until his marriage to his present wife in 1961 the father alone took care of the children, worked and re-established himself financially. He has at all times furnished an adequate and clean home for them and they were well cared for. The appellee married well and until November 1964 had lived with her husband and child in a two-room efficiency apartment in Des Moines.
On July 1, 1962, when appellant and the children were in Des Moines on a visit, appellee, claiming fraud and duress was practiced in obtaining the original divorce decree, filed a petition for a writ of habeas corpus and had notice served upon appellant, who promptly returned to Bridgeport with the children. On July 2, 1962, appellee filed an application to modify the decree of divorce, but no hearing was held thereon until December 15, 1965.
On July 12, 1962, the petition for habeas corpus was granted, although appellant and the children were not present at the hearing. Therein the court purported to change the custody of the children to appellee, but no attempt was made to enforce that decree and the children continued to live with the father in Bridgeport. Apparently appellee abandoned this procedure and chose to pursue the remedy of modification. While the validity of the habeas corpus decree is not relied upon here, a copy of that decree evidently played a part in the effort to get appellee physical possession of the children.
In November 1964, after a family quarrel of some sort, the father of appellant's present wife learned thereof from her sister, drove to Bridgeport and, unknown to appellant, took his daughter, appellant's wife, and all the children back to Des Moines, Iowa. Over the protests of appellant's present wife, these two children were taken to the home of appellee. When his wife advised him of the situation by telephone, appellant came to Des Moines and filed a petition for a writ of habeas corpus to recover possession of the children. At the hearing thereon on March 25, 1965, the court took custody of the children, continued the matter, and left them with the appellee-mother until a full hearing could be had on her pending application for modification of the divorce decree. On December *883 15, 1965, hearing was had and the court's decree, entered on January 6, 1966, granted appellee's application, changed custody of the two children to the mother, and provided support money for their maintenance. The sole issue in this appeal, therefore, is whether the court erred in granting this modification pursuant to the showing made by appellee.
The record discloses that appellant, in spite of his dire financial circumstances, faithfully cherished and provided for the children through infancy, that he had steadily improved his financial circumstances, maintained an adequate and clean home in Bridgeport, and that the children regularly attended school and church. The record fully supports a finding that the children were loved and had affection for their father and new "Mommie". On the other hand, the mother, her husband and child, had lived in a nice two-room apartment in Des Moines until she obtained these children. Then they moved into a new three-bedroom house. Her financial, moral, and physical circumstances had greatly improved and she was able to care for these children. Admittedly, the circumstances of each party had improved. Were these changed circumstances sufficient to make expedient a modification as to custody? We think not.
VII. It is quite clear to us that appellant at no time abandoned these children. The record discloses his present wife did not leave him as a result of the November 1964 quarrel, and that she loves and wants Jeffrey and Susan to remain with them in Bridgeport. It is also abundantly clear her father was under the impression these children were the source of domestic trouble in appellant's home and undertook to relieve that situation by delivering them to their mother without legal authority. The present Mrs. Maikos testified as follows: "Q. If Jeffrey Maikos and Susan Maikos were returned to the physical possession of their father, they would be living with you in Bridgeport? A. Yes, sir. Q. What would be your feeling toward having them in your home? A. Very good. Q Would you have any resentment toward them because they were not your own children? A. No, sir. Q. Prior to last November a year ago, what did they call you? A. Mother, Mommy, Mom." In answer to the question as to what they called her the day before the hearing she said they called her "Mommie", and to the question of "How do you feel toward them", she answered, "I love them very much."
As to the circumstance surrounding her trip to Iowa with her father in November 1964, she said she called her sister in Des Moines and said she wanted to come home for a visit, and that her father with a brother-in-law came after her and insisted on bringing Jeffrey and Susan back to Iowa. In answer to the question, "What was said at that time with regard to bringing Jeffrey and Susan back to Iowa?" she replied, "My father said he was bringing them back because he had this document, this written permission from Oppie (the mother) to bring them back. I told my father I couldn't bring them back. As far as I was concerned, Johnny still had full custody of the two children. He had papers showing that Oppie had custody and he also had a written permission for him to bring the kids back here; and he said they was going and I said no they weren't. He said don't tell them they are going to Oppie." Her father denied he kidnapped these children, but admitted he took his daughter and all the children to Des Moines, driving all night to get there.
As to the circumstances of delivery of the children to the mother, Mrs. Maikos testified her father took them to Betty Sage's house, where she stayed while in Iowa. The appellee-mother came over to get the children and, as to those circumstances, she said: "Q. What was the reason for your allowing Opal to take Susan and Jeffrey? A. I didn't allow it. Q. How did she get took them? A. Just took them. Q. She just took them away from you? A. Yes. Q. *884 You let her? A. Yes. Q. What was the reason for that? A. She wanted them. Q. And you didn't? A. Yes, I did." She said, "I had no choice. * * * She came to get them and I was told I wasn't the mother, the legal mother, that she was and they was allowed to have them." "Q. Who told you that? A. My father." She further stated: "She (Opal) told me she had a legal document and she had custody." Appellant's present wife further denied making any statement that these children were the reason for domestic quarrels with appellant and that she was going to bring them back to Des Moines so Opal could have them. There was testimony corroborating and denying this evidence, but in any event we are satisfied it was her father that insisted on bringing the children back to Iowa, that appellant's wife objected to the mother's taking them from her possession, and that there was no abandonment of them by either appellant or his wife. We are further satisfied there is and always has been love and affection between his present wife and the children and that none of them desired this separation. When they were taken by the mother, it appears "Jeffrey started screaming and hollering he wanted to go back to his father," and Susan started crying.
It is true the children were somewhat disheveled and dirty when they arrived in Des Moines after a hasty departure from home and an all-night trip, but under the circumstances that evidence of a lack of proper care is of little consequence. Most of the evidence as to their care and cleanliness was to the contrary.
VIII. The material change of circumstances appellee attempted to show the court is a change in herself and her financial circumstances. The record is silent of any substantial proof on her part that the children will be better off with her in Des Moines than they were in Connecticut. Although the children are too young to judge conditions for their welfare, they did indicate their desire to return to their home in Bridgeport. We said in Mason v. Zolnosky, 251 Iowa 983, 989, 103 N.W.2d 752, 755: "True, the welfare of the child is of greatest importance; but when this has once been decided, and a custodial order made, it will not be overturned unless a material change in circumstances has occurred. Any other procedure would leave the latter open to the most undesirable result of endless litigation and continual uncertainty."
In Welch v. Welch, supra, 256 Iowa 1020, 1024, 1025, 129 N.W.2d 642, 644, we said: "We have held time and again child custody and support provisions of a divorce decree are final as to the circumstances then existing. Such provisions will be modified only where it is proven by a preponderance of the evidence that subsequent conditions have so changed that the welfare of the children requires, or at least makes expedient, such modification. In matters of this kind the child's welfare is the controlling consideration. (Citations) Of course not every change of circumstances is sufficient basis for modification of a divorce decree. We have said several times a decree will not be modified unless its enforcement will be attended by positive wrong or injustice as a result of the changed conditions. Pearson v. Pearson, supra, and citations; Jensen v. Jensen, supra; Dawson v. Dawson, 249 Iowa 588, 592, 88 N.W. 2d 117, 119."
Here it is obvious the circumstances as to the father's home had changed for the better, the facilities for raising and caring for the children were adequate and proper, and were as contemplated by the trial court in its original decree. There appears to be no reason to make this change in custody except perhaps, as presently situated, the mother could supply more of the luxuries and nonessentials than the father. This is not the test. If it were, children could be shuttled back and forth depending upon the instant financial status of the parents. All authorities agree this is not the guide in the determination of what is best for the child's welfare. Heater *885 v. Heater, supra, 254 Iowa 586, 118 N.W.2d 587.
IX. The remaining question then is, would this change be expedient? We are satisfied it would not be expedient to approve the method used by the mother to obtain possession of these children, or to reward her with their custody at the expense of the father who did not neglect or desert them as infants. Factual matters subsequent to the original divorce do not appear to be of such character as to require a change in the original decree, and since that decree is final as to those circumstances, no change in custody should be decreed. Burrell v. Burrell, supra, 256 Iowa 490, 127 N.W.2d 78, and citations. Clearly, conditions have not deteriorated so as to make any change expedient. There is no showing that the father has failed the children and, as tending to prove he has sufficient space for this family, we were told in oral argument that he now has a four-bedroom house to accommodate them.
X. Basically, then, here we have only the fact that appellee has rehabilitated herself and married advantageously. She now also has an acceptable home for the children. The situation is much like that we considered in Dow v. Dow, 240 Iowa 145, 150, 151, 35 N.W.2d 853, 856, where we said: "The only subsequent circumstance in this case is the mother's remarriage and the establishment of a (suitable) home. We know from the record she remarried three days after the divorce decree (here it was within a month)a decree that gave custody of Larry to the father and a decree which bears her written approval as to form * * *. We do not know when the home in Davenport was purchased but it was sometime during the four-month period after the divorce and before the application for modification was filed. While precedents are not of great value when the superior question concerns a child's welfare, we have held that a trial court was right in not changing an order that gave the father custody, upon a showing that the mother had remarried and established a home and had financial ability to support the child. Daniels v. Daniels, 145 Iowa 422, 124 N.W. 169; Freese v. Freese [237 Iowa 451, 22 N.W.2d 242], supra. * * * The evidence is overwhelming that the boy is being properly cared for under the original order that placed the boy in his father's custody and, temporarily in his aunt's home. It seems to us far too soon to change the original order of custody without some clear showing that the changed order will result in a distinct improvement in the boy's welfare. No such showing is made in this case."
Also, to a like effect, see Beyerink v. Beyerink, supra; Jensen v. Jensen, supra; Pearson v. Pearson, supra; Smith v. Smith, supra; Welch v. Welch, supra.
XI. Perhaps the most perplexing problem before us in this troublesome case is the period of time these children have now been physically absent from appellant's home. Over two years have passed since they were wrongfully taken from his home and have been physically present in appellee's home. It is unfortunate that they must be moved again. However, it is our feeling that these periods of delay are not to be charged to appellant who resides in Connecticut. He promptly made a good faith, although fruitless, effort to recover possession of the children, but the court rejected his plea at that time. Under these conditions the lapse of time should not operate to deprive him of the custodial right and privilege given him by the original trial court. While the paramount question is not the rights of either parent, and frequent shifting of the children from one home to another is abhored, when we take into consideration what is right and just under the revealed circumstances leading up to the appellee's physical possession of them, we conclude the children's best interest will be served by rejecting any change in their legal custody at this time. The love of a devoted father and his wife toward these children overshadows any *886 possible physical advantages of appellee's fine home or her understandable desire to now have the custody, love and affection of her children. In this case we must hold the equities are with the father. Having carefully reviewed the record, we must hold the mother has failed to show the required change of circumstances to justify a modification of the original divorce decree. The father under this record is entitled to retain the custody and control of Jeffrey and Susan, and the modification order of the district court is reversed.
Reversed.
THORNTON, SNELL, STUART, MASON, RAWLINGS and BECKER, JJ., concur.
GARFIELD, C. J., dissents.
MOORE, J., takes no part. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581236/ | 42 So.3d 312 (2010)
Rosie C. DIAZ, Appellant,
v.
David A. MANEY, individually; David A. Maney, as agent for Maney, Damsker, Jones, Kiely & Kuhlman, P.A.; and Maney, Damsker, Jones, Kiely & Kuhlman, P.A., Appellees.
No. 2D09-1758.
District Court of Appeal of Florida, Second District.
August 11, 2010.
*313 Patrick Dekle of Patrick Dekle, P.A., Tampa, and Heather C. Goodis of Thompson Goodis Thompson Groseclose Richardson Miller, P.A., St. Petersburg, for Appellant.
Charles W. Hall and Mark D. Tinker of Banker Lopez Gassler, P.A., St. Petersburg, for Appellees.
DAVIS, Judge.
Rosie C. Diaz challenges the final summary judgment entered in favor of Appellees David A. Maney, individually and as an agent for his law firm Maney, Damsker, Jones, Kiely & Kuhlman, P.A., and the firm itself in Diaz's action for legal malpractice. Because the trial court's determination as to when the statute of limitations on Diaz's legal malpractice action began to run is not supported by the record, we reverse.
The underlying litigation arose out of Maney's representation of Diaz in her volatile relationship with her former husband, Edward C. Rood, which eventually ended in the dissolution of their marriage. Prior to the filing of the petition for dissolution, but after discord developed in the marriage, Diaz retained the services of Maney and his firm. While separated, Diaz and Rood attempted reconciliation through the use of a third-party counselor. During a counseling session, as a gesture of his sincerity in desiring reconciliation, Rood offered Diaz one-half of the inheritance that he would receive upon the death of his father and one-half of the inheritance that he would receive upon the death of his mother. Rood expressed these offers in two handwritten notes, which Diaz took to Maney for counsel on formalizing the agreements. Maney's firm prepared two documents by which Rood purportedly assigned to Diaz one-half of his "right, title and interest" in his father's and mother's estates. Both assignments referenced "good and valuable consideration," but neither identified the nature of that consideration.[1]
Rood executed the assignments as prepared and then moved back into the couples' home; however, seven weeks later, Diaz asked him to move out and filed for dissolution. Maney and his firm represented Diaz throughout the dissolution action. The parties settled the property issues in the dissolution proceeding by the execution of a marital settlement agreement that was adopted by the trial court and incorporated as part of the final judgment of dissolution. The marital settlement agreement did not make any reference to the assignments of Rood's potential inheritances and included a paragraph in which the parties agreed that the settlement was their only agreement and that it superseded any prior understandings or agreements between them. The final judgment of dissolution was entered April 4, 1996.
Upon the death of Rood's father in April 2000, Diaz filed a claim with his estate that *314 was based on Rood's assignment to her of one-half of his interest in the estate. The estate filed an objection to the claim.[2] The record suggests that Diaz then filed a civil action against Rood individually, seeking to enforce the assignment. Rood defended against that lawsuit by arguing that the assignment failed for lack of consideration. The trial court granted Rood's motion for summary judgment based on "the absence of fair and sufficient consideration from... Diaz." This court reversed, concluding "that the trial court applied an incorrect legal standard in determining whether sufficient consideration existed to support the assignment." Diaz v. Rood, 851 So.2d 843, 845 (Fla. 2d DCA 2003) (Diaz I). On remand, the trial court held an evidentiary hearing and again agreed with Rood that the assignment was void due to a lack of consideration. That final judgment was affirmed by this court. See Diaz v. Rood, 896 So.2d 754 (Fla. 2d DCA 2005) (table decision) (Diaz II).
Diaz then filed the instant litigation, alleging that Maney and his firm committed legal malpractice by not protecting her rights to collect from Rood one-half of his interest in his father's estate. Maney moved for summary judgment, arguing that undisputed facts show that Maney did not breach his duty to his former client and that the statute of limitations barred Diaz's claim. Specifically, Maney argued that the two-year time limit for Diaz to file a legal malpractice action began to run on April 4, 1996, when the final judgment of dissolution was entered. Maney maintained that the final judgment's incorporation of the marital settlement agreement, which explicitly stated that it superseded all other agreements between Diaz and Rood, put Diaz on notice of the unenforceability of Rood's assignment to her of fifty percent of his inheritance from his father's estate. It was at that point, according to Maney, that any cause of legal malpractice accrued.
At the hearing on Maney's summary judgment motion, the trial court inquired about the probate proceedings involving Rood's father's estate and the filing of Diaz's claim based on Rood's assignment. The attorneys responded that Diaz made a claim and that, following an objection by the estate, she filed a separate civil lawsuit against Rood.[3] The trial court further inquired as to why the statute of limitations did not start to run when the probate judge ruled the assignment invalid in the probate proceedings in 2000. Counsel for Diaz argued that the final determination that Rood's assignment to Diaz of fifty percent of his inheritance from his father was invalid for lack of consideration was made in Diaz's civil action against Rood, which was not final until it was affirmed on appeal. Counsel further pointed out that Diaz's legal malpractice suit against Maney was filed within two years of this court's per curiam affirmance in Diaz II.
The trial court allowed the attorneys to file supplemental written arguments *315 and then entered its order. In that order, the trial court stated:
It appears to this court that Ms. Diaz specifically knew that there was a problem with the [marital settlement agreement] once she submitted a claim in the Rood, Sr., estate and the probate judge denied it. That action occurred in 2000, and started the running of the [statute of limitations] clock.
There is nothing in the record before us, however, that supports a finding that in 2000 the probate court denied Diaz's claim on Rood's father's estate. As such, the trial court's finding that Diaz was made aware of possible negligence on Maney's part at that time is not supported by competent, substantial evidence.
Rather, the only evidence in the instant record of Diaz's being made aware that the assignment prepared by Maney's law firm was invalid was the trial court's entry of summary judgment in her civil case against Rood. However, "a cause of action for legal malpractice does not accrue until the underlying legal proceeding has been completed on appellate review because, until that time, one cannot determine if there was any actionable error by the attorney." Peat, Marwick, Mitchell & Co. v. Lane, 565 So.2d 1323, 1325 (Fla. 1990); see also Ramsey v. Jonassen, 698 So.2d 581 (Fla. 2d DCA 1997). In the instant case, had this court reversed the trial court's determination in Diaz's civil suit that Rood's assignment was unenforceable, Diaz would not have had a cause of action against Maney or his firm. However, when the determination that the assignment was unenforceable was affirmed by this court, a cause of action against Maney for negligent representation accrued. Then, and only then, did the statute of limitations begin to run.[4] Accordingly, the trial court erred in granting summary judgment on that basis, and we must reverse the trial court's final judgment and remand the case for further proceedings.
Reversed and remanded.
KELLY and MORRIS, JJ., Concur.
NOTES
[1] At the hearing on Maney's motion for summary judgment in the instant case, both Maney and the associate he had tasked to prepare the assignments testified that they believed the consideration was allowing Rood to move back into the marital home.
[2] This fact is alleged in the parties' pleadings and through argument of counsel; however, there is nothing in the record before this court that documents any probate proceedings or decisions.
[3] A reading of the transcript of the summary judgment hearing suggests that there was some confusion regarding whether the assignment was deemed invalid for lack of consideration in the probate proceeding or in Diaz's civil suit against Rood. The attorneys advised the court that Judge Sexton had made the ruling. The confusion seems to arise from the fact that Judge Sexton presided over both the probate proceeding and the Diaz/Rood civil case. There is nothing in the record to indicate, however, that Judge Sexton ever ruled on the assignment in the probate proceeding.
[4] In so concluding, we are not expressing any opinion on the sufficiency of Diaz's claim for legal malpractice. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581237/ | 33 Wis.2d 351 (1967)
WOJKIEWICZ and another, Appellants,
v.
AMERICAN FAMILY MUTUAL INSURANCE COMPANY and another, Respondents.
Supreme Court of Wisconsin.
December 1, 1966.
January 3, 1967.
*353 For the appellants there was a brief by Edward R. Cameron and Alvin L. Zelonky, both of Milwaukee, and oral argument by Mr. Cameron.
For the respondents there was a brief and oral argument by Raymond R. Colwin of Fond du Lac.
GORDON, J.
Mr. Wojkiewicz's version of this accident, if accepted in its entirety, would suggest that justice miscarried in the trial court. His version depicted Mr. Pinno as having failed to make a proper lookout and as having suddenly crossed from the right lane of the highway to the left lane in front of the Wojkiewicz car, without giving a turn signal. According to Mr. Wojkiewicz, Mr. Pinno made an unlawful left turn into a crossing which was reserved for state patrol cars and emergency vehicles. Mr. Wojkiewicz claimed that he, himself, was traveling within the speed limit when he observed the Pinno car, which flashed its brake lights (but not a directional turn signal) and then made an abrupt left turn from the far right side of the highway. If these were the full and correct facts, the assessment of only 30 percent of the negligence to Mr. Pinno would seem untenable.
Upon this appeal we are mindful of our statement in Baker v. Herman Mut. Ins. Co. (1962), 17 Wis. (2d) 597, 607, 608, 117 N. W. (2d) 725, that where the trial *354 judge has refused to grant a new trial in the interests of justice, this court "is ordinarily inclined to defer to this decision of the trial court." See also Mack Trucks, Inc., v. Sunde (1963), 19 Wis. (2d) 129, 140, 141, 119 N. W. (2d) 321.
This court has asserted that it will not exercise its discretionary power to grant a new trial in the interests of justice unless it is convinced that there has been a probable miscarriage of justice, viewing the case as a whole. Wanserski v. State Farm Mut. Automobile Ins. Co. (1964), 23 Wis. (2d) 368, 378, 127 N. W. (2d) 264; Chapnitsky v. McClone (1963), 20 Wis. (2d) 453, 467, 122 N. W. (2d) 400.
There are several major contradictions to the version of the accident given by Mr. Wojkiewicz as outlined above. The testimony of Mr. Pinno and of his passenger, Mrs. Wood, would have warranted the jury's believing that the directional signal light of the Pinno car was turned on and that the Pinno car "angled" across the highway in a manner which was not precipitous. Their testimony also showed that the collision took place when the Pinno car was entirely in the turn-off, to the left of the paved portion of the highway.
Also, there is evidence which the jury could have accepted to establish that Mr. Wojkiewicz's own negligence was very serious. Although he had observed what he thought were brake lights going on and off, the jury could have determined that his lookout was defective in not recognizing Mr. Pinno's directional turn signal. The jury also may have deemed that Mr. Wojkiewicz was negligent as to speed under the circumstances by concluding that he should have reduced his speed upon observing what he thought were the Pinno brake lights; the jury may have been impressed with the fact that Mr. Wojkiewicz left skid marks measuring over 205 feet. In addition, if the jurors believed that the impact occurred within the turn-off, this might have led them to believe that *355 Mr. Wojkiewicz was negligent as to his management and control. While we do not know the specific items of negligence which the jurors attributed to Mr. Wojkiewicz, we find substantial support in the record for their answers to the comparative negligence questions.
The plaintiffs also contend that the inadequacy of the damages reflects perversity in the verdict. We have carefully reviewed the evidence regarding damages and find no basis for reversal.
Mrs. Wojkiewicz sustained numerous injuries including sprains to the neck, back and right shoulder, a concussion and various lacerations. There was a conflict in the medical testimony regarding the permanence of her neck and back difficulties. During the year following the accident, Mrs. Wojkiewicz participated actively in bowling leagues, and the jury's assessment of $2,000 for her personal injuries is not deemed perverse.
The jury allowed only $100 for Mr. Wojkiewicz's personal injuries. This amount seems quite low for the injuries and discomfort which he sustained. However, here, too, there was a conflict in the medical evidence, and we decline to hold that the award is so inadequate as to be perverse. In addition, there is applicable to Mr. Wojkiewicz's damages what was said in Sell v. Milwaukee Automobile Ins. Co. (1962), 17 Wis. (2d) 510, 519, 117 N. W. (2d) 719:
"The rule is that where a jury has answered other questions so as to determine that there is no liability on the part of the defendant, which finding is supported by credible evidence, the denial of damages or granting of inadequate damages to the plaintiff does not necessarily show prejudice or render the verdict perverse."
This statement in the Sell Case was specifically reaffirmed in Metcalf v. Consolidated Badger Co-operative (1965), 28 Wis. (2d) 552, 565, 137 N. W. (2d) 457, and Fink v. Reitz (1965), 28 Wis. (2d) 319, 323, 137 N. W. (2d) 21.
*356 Viewing the case as a whole, we are not convinced that there has been a probable miscarriage of justice.
By the Court.Judgment affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581238/ | 919 F.Supp. 936 (1996)
Ellen V. ELLIS, Plaintiff,
v.
METROPOLITAN LIFE INSURANCE COMPANY, Defendant.
Civil Action No. 2:95 CV 1003.
United States District Court, E.D. Virginia, Norfolk Division.
April 1, 1996.
John B. Mann, Levit & Mann, Richmond, VA, for plaintiff.
Gerard Joseph Roerty, Jr., Mays & Valentine, Richmond, VA, David Edward Constine, III, Mays & Valentine, Richmond, VA, for Metropolitan Life Insurance Company.
OPINION AND ORDER
DOUMAR, District Judge.
The question presented on this motion is whether the plaintiff is entitled to a jury trial in this action under various provisions of the Employee Retirement Income Security Act of 1974. For the reasons that follow, the Court holds that she is not. The defendant's motion to strike the jury demand will be GRANTED.
I. Factual and Procedural Background
Ellen Ellis ("Ellis") is a former employee of NationsBank, and most recently served a vice president and branch manager for the bank. She was placed on disability on or about March 4, 1993; her employment terminated on April 3, 1995. Through her employment with NationsBank, she participated in an employee disability plan. The plan is an employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq. When she was determined to be disabled, she received disability benefits under the Plan through the insurer, Metropolitan Life Insurance Company ("Metropolitan"). These payments continued until she was notified by Metropolitan on December 9, 1993 that she was not entitled to disability benefits effective December 31, 1993.
She subsequently filed this action against NationsBank as the Plan Administrator. On motion of plaintiff, the parties agreed to substitute Metropolitan as the defendant.
Ellis' Complaint contains three counts. She alleges that (1) defendant failed to provide her with a specific reason for the denial of benefits, in violation of 29 U.S.C. § 1133; (2) defendant failed to provide her with an opportunity for a full and fair review of her claim, again in violation of 29 U.S.C. § 1133; and (3) the decision of defendant violated the terms of the plan, was arbitrary and capricious, and not in good faith.
Ellis seeks (1) an order that defendant pay her all disability benefits accrued and unpaid to the date of a judgment; (2) an order that defendant designate the plaintiff as an eligible participant under the plan and pay her accordingly so long as she qualifies; and (3) attorney's fees. She demanded a jury, and, in the alternative, an advisory jury.
On January 26, 1996, defendant moved to strike the jury demand, contending that jury trials are not permitted in ERISA actions in *937 this Circuit. Plaintiff did not respond to the motion.
II. Discussion
At the outset, it is worth emphasizing that plaintiff has failed to follow Rule 10(E)(1) of the Local Rules of this Court,[1] which requires parties to submit briefs in opposition to all motions within eleven days after service of the motion. Defendant complied with the service requirements. Moreover, the Clerk of the Court informed counsel by letter dated February 13, 1996 that the matter had been referred to the undersigned for a decision. On March 27, 1996, the defendant submitted a proposed order which plaintiff's counsel signed under the heading "Seen and Objected To:" Thus, plaintiff still contests the legal position urged by plaintiff, although the Court does not have the benefit of argument from her.
In any event, the law of this Circuit is clear that jury trials are not generally permitted in ERISA actions. Berry v. Ciba-Geigy Corp., 761 F.2d 1003, 1007 (4th Cir. 1985). That case, as here, involved a denial of disability benefits under an ERISA plan. The Court stated that although ERISA itself was silent on the right to a jury, Congress' silence indicated that ERISA actions were, in essence, proceedings under the common law of trusts, where no jury obtained. Id.
The Court reaffirmed Berry in Biggers v. Wittek Industries, Inc., 4 F.3d 291, 297-98 (4th Cir.1993). There, the court reversed a judgment awarded by a jury, applying Illinois law, which had found the defendant in breach of contract. The Fourth Circuit concluded that his claim was really an ERISA claim for failure to comply with an employee benefit plan. The primary issue in the case involved whether there was a meeting of the minds between the parties. The Court reversed for a new trial before a judge under ERISA. Id. at 298.
Several circuit courts adhere to the rule adopted by the Fourth Circuit. E.g., Spinelli v. Gaughan, 12 F.3d 853, 857 (9th Cir. 1993); Blake v. Unionmutual Stock Life Ins. Co., 906 F.2d 1525, 1526 (11th Cir.1990); Cox v. Keystone Carbon Co., 894 F.2d 647, 650 (3d Cir.1990). The large majority of district courts in this circuit also continue to hold that a jury trial is not permitted in most ERISA contexts. Colonial Williamsburg Found. v. Blue Cross & Blue Shield, 909 F.Supp. 386, 390-91 (E.D.Va.1995); Broadnax Mills v. Blue Cross & Blue Shield, 876 F.Supp. 809, 816-17 (E.D.Va.1995); Farrie v. Charles Town Races, Inc., 901 F.Supp. 1101, 1106-07 (N.D.W.Va.1995); Abels v. Kaiser Aluminum & Chemical Corp., 803 F.Supp. 1151, 1153-54 (S.D.W.Va.1992); Quesinberry v. Individual Banking Group. Acc. Ins., 737 F.Supp. 38, 41 (W.D.Va.1990); Wise v. Dallas & Mavis Forwarding Co., 751 F.Supp. 90, 92 (W.D.N.C.1990).
Despite this weight of authority, at least one court in this district has held that actions arising under Section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B), may be tried before a jury if they involve issues that are legal in nature. Hulcher v. United Behavioral Systems, Inc., 919 F.Supp. 879 (E.D.Va. 1995). In Hulcher, Judge Merhige concluded that intervening Supreme Court cases call into question the continued vitality of Berry.
In Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989), the Supreme Court held that actions under Section 502(a)(1)(B) should be reviewed de novo (rather than under an arbitrary and capricious standard) unless the benefit plan gives the administrator discretion to determine eligibility for benefits. 489 U.S. at 115, 109 S.Ct. at 956-57. Thus, Firestone cast in doubt one basis for the Berry court holding, which had stated that the "arbitrary and capricious" standard was "second-nature" to a judge, but "not readily communicated to jurors." Berry, 761 F.2d at 1006-07. But that was not the sole basis of the Berry holding. As noted above, the Berry court made clear that Congressional silence in ERISA as to the right to a jury led to an inference that ERISA was governed by the common law of trusts, and that the determination *938 of rights under employee benefit plans are "equitable in character and thus a matter for a judge, not a jury." Id. at 1007.
The Hulcher court also found significance in the failure of the Berry court to engage in an analysis as to whether there was a right to a jury trial under the Seventh Amendment, given the Supreme Court's recent emphasis on that right. See Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 558, 110 S.Ct. 1339, 108 L.Ed.2d 519 (1990); Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 109 S.Ct. 2782, 106 L.Ed.2d 26 (1989); Tull v. United States, 481 U.S. 412, 107 S.Ct. 1831, 95 L.Ed.2d 365 (1987). Hulcher failed to note, however, that Biggers, which followed the foregoing line of cases, also did not undertake a Seventh Amendment analysis; its silence would indicate that courts need not do so in the ERISA cases, and suggests that the Berry holding that ERISA cases are a matter for judges (not juries) remains good law. Indeed, Biggers might appear, at first blush, to be a strong candidate for a Seventh Amendment inquiry, because it presented what could be considered a legal issue. The question of receiving benefits from a fund administered by a fiduciary, however, has always been, and continues to be, a matter traditionally answerable in a court of chancery.
In the case at bar, plaintiff seeks benefits due under Section 502(a)(1)(B) of ERISA. That provision permits a plan participant to bring a civil action "to recover benefits due ... under the terms of [the] plan, to enforce [her] rights under the terms of the plan, or to clarify [her] rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B). Arguably, the recovery of "benefits due" may appear to sound in contract, and could therefore be construed to be a legal issue (as the Hulcher court did) but only if one ignores the traditional chancery jurisdiction.
Close reading of both Firestone and Biggers confirms the weakness of the Hulcher court's position. As Firestone made clear, ERISA "abounds with the language and terminology of trust law." 489 U.S. at 110, 109 S.Ct. at 954. The specific holding in Firestone was that a challenge to a denial of benefits under Section 502(a)(1)(B) required de novo review (unless the administrator had discretion to determine eligibility). In so stating, the Court made plain that its holding regarding that section was guided by "established principles of trust law." Id. at 115, 109 S.Ct. at 956. It follows that the question of "who decides" (Judge or jury) under Section 502(a)(1)(B) should also be guided by such principles.
Biggers involved essentially the same issue presented here: a denial of benefits to an individual employee under the employee benefit plan. The district court in Biggers had examined the question under state law contract principles, without considering that trusts were traditionally a matter for the chancery, not the law courts. But because the action itself stated a claim under ERISA, the Fourth Circuit stated, in no uncertain terms, that it required a bench trial. 4 F.3d at 298.
Consequently, had the plaintiff argued that the Seventh Amendment entitled her to a jury which she did not, because she presented no argument the analysis under Terry principles would be simple and straightforward: both the nature of the claim and the nature of the remedy are equitable.
III. Conclusion
The Court HOLDS that Ellis has no right to a jury trial in this action. Accordingly, Metropolitan's motion to strike the jury demand is GRANTED.
The Clerk of the Court is DIRECTED to forward copies of this order to counsel for the parties.
IT IS SO ORDERED.
NOTES
[1] The Local Rules were amended February 1, 1996. On the date that Metropolitan made its motion to strike (January 26), the same rule was found at Rule 11(F). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581528/ | 42 So.3d 398 (2010)
STATE ex rel. Jimmy Joseph YATES
v.
STATE of Louisiana.
No. 2009-KH-2096.
Supreme Court of Louisiana.
August 18, 2010.
*399 Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581160/ | 919 F. Supp. 1506 (1996)
AMERICAN MOTORISTS INSURANCE COMPANY, Plaintiff,
v.
GENERAL HOST CORPORATION and American Salt Company, Inc., Defendants.
Civil Action No. 84-1802-FGT.
United States District Court, D. Kansas.
March 8, 1996.
*1507 M. Kathryn Webb, McDonald, Tinker, Skaer, Quinn & Herrington, Wichita, KS, Timothy C. Russell, Thomas S. Schaufelberger, Douglas Crowne McAllister, Drinker, Biddle & Reath, Washington, DC, T. Andrew Culbert, Tracey S. Ging, Drinker, Biddle & Reath, Philadelphia, PA, for plaintiff.
*1508 Ron C. Campbell, Thomas D. Kitch, Fleeson, Gooing, Coulson & Kitch, L.L.C., Wichita, KS, Rodney Zerbe, Thomas F. Munno, William F. Downey, Dechert, Price & Rhoads, New York City, for defendants.
Ron C. Campbell, Thomas D. Kitch, Fleeson, Gooing, Coulson & Kitch, L.L.C., Wichita, KS, Rodney Zerbe, Dechert, Price & Rhoads, New York City, for counter-claimants.
M. Kathryn Webb, McDonald, Tinker, Skaer, Quinn & Herrington, Wichita, KS, Timothy C. Russell, Thomas S. Schaufelberger, Drinker, Biddle & Reath, Washington, DC, for counter-defendant.
MEMORANDUM AND ORDER
THEIS, District Judge.
This is a declaratory judgment action in which the plaintiff, American Motorists Insurance Company ("AMICO"), seeks a determination that it is not responsible for paying the judgment or defense costs for the defendants in Miller v. Cudahy, a case which was tried to this court some twelve years ago. Miller involved salt pollution of the Cow Creek Aquifer caused by operations of the American Salt plant near Lyons, Kansas. Miller v. Cudahy, 592 F. Supp. 976 (D.Kan. 1984), aff'd in part, rev'd in part, 858 F.2d 1449 (10th Cir.1988), cert. denied, 492 U.S. 926, 109 S. Ct. 3265, 106 L. Ed. 2d 610 (1989). The American Salt plant was, at that time, owned by a wholly owned subsidiary of General Host.
The court granted the plaintiff's motion for summary judgment in this case in 1987. American Motorists Ins. Co. v. General Host, 667 F. Supp. 1423 (D.Kan.1987). The matter was appealed to the Tenth Circuit Court of Appeals, which affirmed this court's grant of summary judgment as to the issue of plaintiff's duty to indemnify, but reversed as to the duty to defend. American Motorists Ins. Co. v. General Host, 946 F.2d 1489 (10th Cir.1991). The appellate court held that there was a credible possibility at the outset of Miller that the action would be covered under the AMICO policy, thus triggering the duty to defend Id. at 1491. Remand was necessary, however, to determine whether any defenses to the duty to defend, such as late notice, apply in this case. Id. The matter is before the court on plaintiff's motion for summary judgment on its own claims and on defendants' counterclaims. (Doc. 154).[1]
1. Undisputed Facts
The facts surrounding this case are largely undisputed. In May 1977, the Miller lawsuit was filed in the United States District Court for the District of Kansas. The matter was tried to the court in 1984, resulting in a judgment for the plaintiffs for actual and punitive damages. Miller, 592 F. Supp. 976.
In 1977, General Host's insurance carrier was Liberty Mutual. Liberty Mutual agreed to defend General Host under a reservation of rights.
AMICO issued general liability policies to General Host and the American Salt Company which were effective from November 1, 1981, through June 15, 1984. These policies were countersigned and issued in the state of New York. Most of the negotiations were held in New York as well.
The policies provided that AMICO had the "duty to defend any suit against the insured alleging: ... property damage and seeking damages...." (Plaintiff's exhibit 31, p. 1). The policies also contained a provision requiring the insured to give written notice of an occurrence "as soon as practicable" and, in the event of a suit or claim brought against the insured, requiring the insured to forward to the insurer papers involved in the suit. (Plaintiff's exhibit 31, p. 17).
During negotiations for the policies, General Host informed AMICO of the Miller case, but told AMICO representatives that the Miller case was based on events which had occurred in the past and would not, *1509 therefore, be covered under the AMICO policies. At that time, General Host did not, in fact, expect to demand coverage from AMICO for the Miller action.
General Host contends that before December 9, 1983, at which the time the court held a pretrial conference in Miller, it was not aware that the Miller case involved claims that arguably could be covered by the AMICO policies. General Host claims that until that time, it believed the Miller plaintiffs sought only permanent damages measured by the diminution in value of their properties due to the salt pollution.[2]
General Host engaged in settlement negotiations with the Miller plaintiffs from October 1983 until shortly before trial. On March 9, 1984, General Host sent a letter to its insurance broker, John Schroeder, for the purpose of demanding coverage under the AMICO policies. Schroeder sent a letter to AMICO demanding coverage on March 19, 1984. The Miller trial was set to begin on March 19, 1984, and actually did commence on March 26, 1984. Miller, 592 F.Supp. at 981.
The Brothers action, involving the same salt pollution and some of the same plaintiffs, was filed on September 5, 1984. Defendant informed Schroeder of the filing of the Brothers suit by a letter dated September 13, 1984. Schroeder sent a letter to AMICO on September 18, 1984, conveying the same information. The filing of the Brothers had been anticipated since the court had ruled in Miller that the plaintiffs could recover temporary damages only through the year of trial.
2. Standard for Summary Judgment
The court is familiar with the standards governing the consideration of a motion for summary judgment. The Federal Rules of Civil Procedure provide that summary judgment is appropriate when the documentary evidence filed with the motion "show[s] that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). A principal purpose "of the summary judgment rule is to isolate and dispose of factually unsupported claims or defenses...." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). The court's inquiry is to determine "whether there is the need for a trial whether, in other words, there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S. Ct. 2505, 2511, 91 L. Ed. 2d 202 (1986).
The burden at the summary judgment stage is similar to the burden of proof at trial. The court must enter summary judgment "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322, 106 S.Ct. at 2552. The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact on its claim(s). Rule 56, however, imposes no requirement on the moving party to "support its motion with affidavits or other similar materials negating the opponent's claim." Id. at 323, 106 S.Ct. at 2552 (emphasis in original). Once the moving party has properly supported its motion for summary judgment, the nonmoving party may not rest upon mere allegations or denials, but must set forth specific facts showing a genuine issue for trial, relying upon the types of evidentiary materials contemplated by Rule 56. Fed.R.Civ.P. 56(e). Each party must demonstrate to the court the existence of contested facts on each claim it will have to prove at trial. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553. The court reviews the evidence on summary judgment under the substantive law and based on the evidentiary burden the party will face at trial on the particular claim. Anderson, 477 U.S. at 254, 106 S.Ct. at 2513.
*1510 3. Choice of Law
The court first addresses the issue of which state's law governs the plaintiff's claims. There is no dispute that a federal court sitting in diversity applies the choice of law rules of the forum state. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 1021, 85 L. Ed. 1477 (1941). Furthermore, the parties agree that under Kansas law, interpretation of a contract is a matter governed by the law of the state in which the last act necessary for the contract's formation is completed. Simms v. Metropolitan Life Ins. Co., 9 Kan. App. 2d 640, 642-43, 685 P.2d 321 (1984).
The plaintiff contends that the last act necessary for the formation of the insurance contract at issue in this case was the signing and countersigning of the policy, which occurred in New York. The court agrees. See Jameson v. Pack, 815 F. Supp. 410, 413 (D.Kan.1993); RLI Ins. Co. v. Kary, 779 F. Supp. 1300, 1303 (D.Kan.1991); Civic Assocs., Inc. v. Security Ins. Co., 749 F. Supp. 1076, 1079 (D.Kan.1990). Defendant argues that the last act necessary for the formation of an insurance contract may be delivery, which in this case occurred in Connecticut. There are cases holding that group insurance policies are governed by the law where the master policy is delivered, Frasher v. Life Investors Ins. Co of America, 14 Kan. App. 2d 583, 796 P.2d 1069 (1990); Simms, 9 Kan. App.2d at 644, 685 P.2d 321, but there is no indication that this rule applies outside the context of group life or health insurance. In the other case cited by defendant, See v. United Ins. Co, 171 Kan. 146, 147, 230 P.2d 1008 (1951), the court held that Kansas law applied where not only had the policy been delivered to Kansas, but the insured had completed and signed the application for insurance in Kansas and had mailed premium payments from Kansas.
Because the policy at issue in this case was issued in New York, this court applies the law of New York in this case.
4. Duty to Defend
An insurer's duty to defend is broader than its duty to indemnify. American Motorists, 946 F.2d at 1490. "So long as the insured can show a nonfrivolous possibility that the claim against it may fall within the coverage of the insurance contract, the insurer has a duty to defend the insured," even if it ultimately is not obligated to indemnify any liability. Id. In determining whether the insurer has the duty to defend, the court looks at the "outstanding viable allegations as of the date the demand to defend was made." Id. at 1491. The Tenth Circuit in this case looked at the complaint and the pretrial order, which had been issued by the time a demand was made. Id. at 1491. The court held that the plaintiffs' allegations of negligent and willful conduct, which did not include precise allegations of when the pollution occurred, were broad enough to support a finding of "sudden and accidental" pollution, which the AMICO policies would have covered. Id. The finding that the pollution was of a longstanding and ongoing nature was made after trial. Id.
Plaintiff argues that it is excused from its duty to defend because the defendant in this case failed to provide the plaintiff timely notice of the underlying claim. The policy at issue in this case contained a provision requiring General Host to notify the plaintiff of an occurrence "as soon as practicable." New York courts interpret such a provision as requiring notification in a reasonable time. Mount Vernon Fire Ins. Co. v. Creative Housing Ltd., 797 F. Supp. 176, 184 (E.D.N.Y.1992). The notice provision is triggered when the circumstances would suggest to a reasonable person the possibility of a claim. Commercial Union Ins. Co. v. International Flavors & Fragrances, Inc., 822 F.2d 267, 272 (2d.Cir.1987). Compliance with a notice provision is a condition precedent to the insurer's duty to provide coverage and duty to defend. Avondale Indus., Inc. v. Travelers Indem. Co., 774 F. Supp. 1416, 1429 (S.D.N.Y.1991). Under New York law, failure to give proper notification relieves the insurer of the duty to defend even if the insurer has independent knowledge of the occurrence and even if the insurer is not prejudiced by the lack of compliance with the notice provision. Id.; Mount Vernon, 797 F.Supp. at 184.
*1511 Ordinarily, the issue of the reasonableness of notice is a question of fact for trial. Travelers Ins. Co. v. Buffalo Reins. Co., 739 F. Supp. 209, 212 (S.D.N.Y.1990). Nevertheless, in the absence of a reasonable excuse or mitigating factor, the New York courts permit the timeliness issue to be disposed of before trial. Id. Lack of knowledge of an occurrence or a good faith reasonable belief of nonliability constitutes a mitigating factor. Id. The insured bears the burden to show the delay was reasonable. Mount Vernon, 797 F.Supp. at 184.
The defendant in this case argues that it has presented a sufficiently reasonable excuse for its delay to create a jury question. A good faith reasonable belief that an occurrence is not covered can excuse failure to notify the insurer of the occurrence. Sparacino v. Pawtucket Mut. Ins. Co., 50 F.3d 141, 143 (2d. Cir.1995); Avondale Indus., 774 F.Supp. at 1431. Defendant contends that it was unaware until the December 1983 pretrial conference that there was a possibility the AMICO policy would be implicated in the Miller suit. Defendant argues, therefore, that demanding coverage in March 1984 constituted reasonable notice.
Under the circumstances of this case, considering the facts in the light most favorable to the defendant, the court holds that the defendant's delay in providing notice to the insurer was unreasonable as a matter of law. Even accepting defendant's argument that it had no reason to believe the AMICO policy was implicated in the Miller case until December 9, 1983, the defendant has provided no arguably reasonable explanation for the three-month delay that followed. It is important to note that during that three month period, trial of the Miller case was scheduled to begin on March 19, 1984. The insurance broker was not given notice until March 9, 1984, just ten days before trial was scheduled to begin, and AMICO itself was not notified until March 19, 1984. It is also relevant that settlement negotiations were conducted and concluded during that time. See American Home Assurance Co. v. Republic Ins. Co., 984 F.2d 76 (2d Cir.), cert. denied, 508 U.S. 973, 113 S. Ct. 2964, 125 L. Ed. 2d 664 (1993) (36-day delay in notification unreasonable under New York law, particularly considering that settlement negotiations for underlying claim were conducted during that time).
The court also rejects defendant's argument that notifying AMICO that the Miller lawsuit was pending before entering into the policy constituted reasonable notice. The defendant at that time did not demand coverage and in fact informed AMICO that the Miller lawsuit would not be covered under the new policy. Under New York law, that the insurer is aware of the occurrence does not excuse the insured's failure to notify the insurer when it intends to seek coverage. See Mount Vernon, 797 F.Supp. at 184.
The late notice defense applies to the Brothers action as well as the Miller action. Although General Host demanded coverage soon after the Brothers action was filed, General Host had anticipated the filing of that lawsuit much earlier.[3] At the time General Host learned that the Miller plaintiffs sought temporary damages, General Host was on notice that other lawsuits would likely be filed as the causes of action accrued. Therefore, the duty to notify arose at that time, with a continuing duty under the policy to forward copies of pleadings to AMICO. Again, General Host failed to give timely notice under the terms of the policy.
Because General Host has provided no reasonable explanation for its delayed notification, AMICO is entitled to summary judgment on its late notice defense and, therefore, on its claim for declaratory judgment. Plaintiff has presented other arguments in support of its motion for summary judgment, but because the late notice issue is dispositive, the court need not address those arguments.
5. Counterclaims
Next, plaintiff seeks summary judgment on the defendants' counterclaims. For the *1512 reasons stated above, the plaintiff is entitled to summary judgment on defendants' first counterclaim, in which defendants seek a declaratory judgment that AMICO is obligated to defend and indemnify defendants for the Miller and Brothers actions, and on the second counterclaim, by which defendants seek damages under a breach of contract theory for the plaintiff's failure to defend or indemnify.[4]
The court turns to defendants' third and fourth counterclaims, both of which relate to Count VI of the Complaint in this action. Count VI is a claim for rescission of the insurance contract in which plaintiff alleges that the defendants intentionally concealed the fact of the ongoing pollution at the American Salt plant and that the Miller suit had been filed. The evidence before the court shows that the Miller case was disclosed to the plaintiff before the insurance policies were issued, but that at that time, there was no indication that the policies would be implicated in the Miller litigation.
In their third counterclaim, defendants contend that plaintiff has breached its duty of good faith and fair dealing. Defendants allege that AMICO acted in bad faith by (1) filing the instant action, (2) falsely accusing defendants of misrepresentation in Count VI, (3) amending the pollution exclusion in the 1984-1985 policy and (4) canceling the 1984-1985 policy. There is no dispute that plaintiff owed the defendants a duty of good faith and fair dealing, and that an insured can collect damages for foreseeable harm caused by a breach of this duty. In re Balfour Maclaine Int'l, Ltd., 873 F. Supp. 862, 872 (S.D.N.Y.1995); McCauley Enterprises, Inc. v. New Hampshire Ins. Co., 716 F. Supp. 718, 721 (D.Conn.1989) (citing Buckman v. People Express, Inc., 205 Conn. 166, 530 A.2d 596 (1987)).[5] However, the court agrees with the plaintiff that none of the defendants' allegations presents a genuine issue of material fact as to the bad faith counterclaim. The plaintiff was within its rights in filing the instant action and has succeeded on the merits. Likewise, the defendant concedes that the plaintiff had a contractual right to cancel the 1984-1985 policy. Furthermore, the defendant cannot show bad faith by alleging that the plaintiff attempted to amend the insurance policy before canceling it. Finally, the defendant has presented no evidence that the falsity of the misrepresentation claim was known or should have been known by the plaintiff at the time the claim was made. The court agrees that plaintiff should have dismissed the claim upon discovering it had no merit, but there is no evidence to suggest that the failure to do so was anything more than an oversight. In addition, defendants have presented no evidence that they were damaged by the bringing of Count VI, and only speculate that the claim for rescission damaged defendants' position in the Miller litigation.
Defendants contend in their fourth counterclaim that plaintiff's Count VI constitutes abuse of process. Defendants allege that the plaintiff, knowing the allegations in Count VI would be used against the defendants in the Miller suit, brought Count VI as part of an effort to malign and intimidate the defendants. Although AMICO's motion asks for summary judgment on the defendants' counterclaims, none of the supporting or opposing memoranda address this counterclaim at any length.
As a ground for summary judgment, AMICO does state that it had no duty to defend or to indemnify. This is insufficient to warrant summary judgment on the abuse of process claim because such a claim does not require a showing that the underlying action was meritless. Hokanson v. Lichtor, 5 Kan. App. 2d 802, 810, 626 P.2d 214 (1981) ("immaterial ... [that] proceedings terminated in favor of person instituting or initiating them," quoting Restatement (Second) of *1513 Torts § 682 cmt. a (1977)).[6] Although on the facts of this case, the abuse of process counterclaim appears to be quite weak, AMICO has not met its initial burden under Rule 56 of demonstrating the absence of a genuine issue of material fact. Accordingly, the court must deny AMICO's motion as to the defendants' fourth counterclaim.
IT IS BY THIS COURT THEREFORE ORDERED that plaintiff's motion for summary judgment (Doc. 154) is hereby granted in part and denied in part.
IT IS FURTHER ORDERED that plaintiff is found to have no obligations to defendants under the policy of insurance for the costs of defending the Miller or Brothers actions, or for any damages awarded in those actions.
NOTES
[1] Defendant General Host has emphasized that its opposition brief is submitted only on its own behalf and not on behalf of defendant American Salt Company. The court has received no submissions from American Salt. However, all the issues and arguments presented on summary judgment apply equally to both defendants. Accordingly, the court has the necessary information to resolve fully the issues before it.
[2] AMICO argues that from the beginning of the Miller litigation, the plaintiffs claimed that operations of the salt plant constituted a continuing nuisance. Nevertheless, for purposes of deciding this motion, the court accepts the defendant's contention that was unaware until December 1983 that the Miller plaintiffs alleged acts potentially covered by the AMICO policy.
[3] General Host's demand letter of September 13, 1984, indicates that the filing of the Brothers action had been "expected." (Defendant's exhibit 49).
[4] Although the parties did not address the first and second counterclaims in their memoranda, the court has sufficient information to rule on these claims because the issues are identical to those raised in the plaintiff's claims.
[5] The parties dispute whether New York law or Connecticut law would apply to this claim. The court will not resolve this issue because the same result would be reached in this case under either state's law.
[6] Although no Kansas court has addressed the choice of law rules to be applied in abuse of process claims, the court believes the Kansas courts would follow Restatement (Second) of Conflicts of Laws § 155 (1971), which provides:
The rights and liabilities of the parties for ... abuse of process are determined by the local law of the state where the proceeding complained of occurred, unless, with respect to the particular issue, some other state has a more significant relationship ... to the occurrence and the parties, in which event the local law of the other state will be applied.
In this case, the occurrence complained of, the filing of Count VI, took place in Kansas, and the defendants claim the purpose of that filing was to intimidate the defendants by jeopardizing their position in another lawsuit litigated in Kansas. The court is not aware of another state which has a more significant relationship to the parties and the occurrence. Accordingly, court applies Kansas substantive law on abuse of process. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581187/ | 147 N.W.2d 875 (1967)
Elaine ALTHOF and Francis Althof, Appellees,
v.
Merlin BENSON and Alma Benson, Appellants.
No. 52294.
Supreme Court of Iowa.
January 10, 1967.
*876 Mosier, Mosier, Thomas & Beatty, Waterloo, for appellants.
Kildee, Keith, Gallagher, Lybbert & Martin, Waterloo, for appellees.
STUART, Justice.
This action arose out of an intersection collision. For the purposes of this opinion we will consider that the drivers of the two vehicles which collided are the only parties involved. At about 8:45 a. m. on February 4, 1963, plaintiff was proceeding east on Maynard Street in Waterloo. At the same time defendant was approaching Maynard Street from the south on Auburn Street. The streets were snow packed and slippery. Yield signs controlled the traffic entering Maynard Street from Auburn Street. Defendant was unable to stop and her automobile struck the side of plaintiff's car as it traversed the intersection. The jury returned a verdict in favor of plaintiff. Defendant appeals assigning two errors.
I. Defendant claims the trial court erred in admitting the testimony of the investigating officer relating to an experiment he conducted after the accident. Evidence disclosed skidmarks 60 feet long ending at the front end of defendant's car. It moved very little after the impact. Defendant testified she came over the crest of the hill on Auburn about 120 feet south of Maynard Street at about 10 miles per hour. She saw the street and the yield sign. She tried to stop but her speed increased to about 15 miles per hour. She saw plaintiff's car when she was about 60 feet from the center of the intersection. "* * * she tried to stop by stepping on the brake, letting up, and then stepping on it again. This didn't seem to slow the car down a bit and it continued in a straight line into the intersection."
On rebuttal Officer Raab testified he completed his investigation in about 35 minutes. He then drove the police car around the block and approached the collision intersection from the same direction as defendant. Traveling at a speed of 20 miles per hour he applied the brakes about 10 feet before the skid marks began and was able to stop in about 40-45 feetabout a car length and a half from the corner.
It is generally agreed experimental evidence is admissible if it is of such a nature that it tends to aid the jury in its deliberations. 20 Am.Jur., Evidence, §§ 758, 759; Anno: 78 A.L.R. 2d 218, 220. Hackman v. Beckwith, 245 Iowa 791, 803, 64 N.W.2d 275. Defendant does not seem to take issue with the rule but claims the conditions and circumstances surrounding the accident and the experiment were so dissimilar that the trial court erred in permitting *877 evidence of the experiment to be admitted.
The admission of experimental evidence rests peculiarly within the sound discretion of the trial court. He must determine if the conditions and circumstances as shown by the evidence are substantially similar. Hackman v. Beckwith, supra; Burg v. Chicago, R. I. & P. Ry. Co., 90 Iowa 106, 116-117, 57 N.W. 680; Huggard v. Glucose Sugar Refining Co., 132 Iowa 724, 729, 109 N.W. 475; Scott v. The Homesteaders, 149 Iowa 541, 548, 129 N.W. 310; Pond v. Anderson, 241 Iowa 1038, 1044-1045, 44 N.W.2d 372; Cunningham v. Court, 248 Iowa 654, 666, 82 N.W.2d 292. We will interfere on appeal only if there has been an abuse of discretion. Hackman v. Beckwith, supra; Chicago Telephone Supply Co. v. Marne & Elkhorn Telephone Co., 134 Iowa 252, 259, 111 N.W. 935; State v. Nowells, 135 Iowa 53, 59, 109 N.W. 1016; Langham v. Chicago, R. I. & P. Ry. Co., 197 Iowa 1118, 1122, 198 N.W. 525.
We must therefore examine the claimed dissimilarities between the conditions and circumstances surrounding the accident and those surrounding the experiment. Different cars were used. There was no showing of the respective gross weights of defendant's 1951 Chevrolet and the officer's 1963 Ford. There was no showing of similarity in type and size of brakes or the size of the wheels or tires. Both vehicles were equipped with snow tires. The fact that a different car is used does not in and of itself exclude experimental evidence. 78 A.L.R. 2d 218, 225.
The foundation could have been improved. The weight of the vehicles and size of the tires bear a direct relationship to stopping distance. Failure to show such comparisons might have justified the trial court in excluding the evidence. However, it is common knowledge that Chevrolets and Fords are in the same class and price range. We do not think the foundation in this respect was so deficient that the trial court abused its discretion in failing to exclude the experimental evidence. The size of the wheels and type of brakes seem relatively unimportant under these circumstances. Braking power is not an issue. The brakes were fully applied and the wheels were skidding.
The evidence disclosed the streets were snow packed and slippery. The officer testified there were some bare spots where the plow cut down to the paving, "but at that hour of the morning I think practically all of it had a slight frost cover on it". Defendant contends the failure to show that the temperature and condition of the road surface were the same at the time of the accident and experiment conducted 35 minutes later requires the exclusion of the evidence. There was evidence the temperature was 30 degrees and the weather clear. Defendant testified: "That she did not remember if the temperature remained about the same that day but that it was quite cold. * * * `I(t) didn't warm up dramatically. I really couldn't remember.' * * * That the temperature must have been below freezing for some time because "I don't think it had thawed at all.'"
An improved foundation would have lessened the chance of an adverse decision by the trial court. However, the experiment was conducted about 35 minutes after the accident. There is nothing to indicate a substantial change in conditions during that period of time. Rarely will an experiment take place under conditions so similar to those present at the time of the accident.
If one were required to show the mental attitude and skill of the party and that of the person conducting the experiment were similar, experimental evidence would seldom be admissible. The same is true of similar traffic conditions. These factors must necessarily go to the weight of the evidence.
We have discovered no Iowa cases in which we have held the trial court *878 abused its discretion in determining the admissibility of experimental evidence, whether it was admitted or excluded. The facts here do not show an abuse of discretion. We believe sufficient foundation was laid here to support the court's ruling admitting this evidence.
II. Prior to trial defendant made a motion asking (1) that the amount sued for in this case be kept from the jury throughout the trial, (2) that counsel for plaintiff be instructed to make no oral mention of the amount of the Ad Damnum in any phase of the trial, (3) that no mention of such amount be made in any written instruction read to the jury. The motion was overruled. Counsel stated in his opening statement and in argument that Elaine Althof was seeking $47,500 and Francis Althof was seeking $7,500. The court instructed the jury with respect to Mrs. Althof's claim: "Your total award of damages cannot exceed the sum of $47,500." With respect to Mr. Althof's claim the jury was instructed: "In no event can the allowance for these items exceed $7,500, the amount claimed by the plaintiff." The jury returned a verdict of $22,500 for Mrs. Althof and $2,500 for Mr. Althof. The overruling of this motion in limine is one of the grounds urged in defendant's Motion for New Trial.
Defendant cites cases from jurisdictions which have held such references to the amount of damages claimed in the pleading improper. Affett v. Milwaukee & Suburban Transport Corp., 11 Wis. 2d 604, 106 N.W.2d 274, 280, 86 A.L.R. 2d 227; Botta v. Bruner, 26 N.J. 82, 138 A.2d 713, 60 A.L.R. 2d 1331; Williams v. Nichols, 4CCA, 266 F.2d 389.
There is a distinction between statements and arguments of counsel and instructions of the court. We recently have refused to reverse judgments for plaintiff on the ground that per diem formulas for pain and suffering were suggested in argument. Corkery v. Greenberg, 253 Iowa 846, 854, 114 N.W.2d 327; Cardamon v. Iowa Lutheran Hospital, 256 Iowa 506, 512, 128 N.W.2d 226. It is not improper for an attorney to inform the jury of the amount plaintiff claims as damages. The jury knows he represents plaintiff. The inclusion of a specific sum in the court's instruction might have entirely different effect. We considered this problem in Cory v. State, 214 Iowa 222, 228, 242 N.W. 100, 103. We said: "It is perhaps true that the mind of a juror is very responsive to suggestions from the court; and perhaps equally true that it is not so responsive as the professional mind often suspects. The instruction, as given, was not erroneous, though we are disposed to the view that, in cases claiming unliquidated damages, the plaintiff is not entitled, as a matter of right, to have the amount of his claim, often exaggerated, stated to the jury, and that an omission of the statement of such amount from the instructions would be quite appropriate." We believe this statement to be sound.
However, we have long held this type of instruction is not improper. McMarshall v. Chicago, R. I. & P. Ry. Co., 80 Iowa 757, 765-766, 45 N.W. 1065, 20 Am. St.Rep. 445; McGovern v. Inter Urban Railway Co., 136 Iowa 13, 22, 111 N.W. 412, 13 L.R.A.,N.S., 476, 125 Am. St. Rep. 215; Grace v. Minneapolis & St. L. Railway Co., 153 Iowa 418, 433, 133 N.W. 672; Winter v. Davis, 217 Iowa 424, 438, 251 N.W. 770; Anno. 2 A.L.R. 2d 454. Such statement is included in the Uniform Jury Instructions, Nos. 3.7, 3.8, 3.9 and 3.10.
In any event, error would have been harmless because there was no showing of prejudice to defendant. The verdicts were considerably smaller than the amount prayed for. There is no claim they were excessive under the evidence. "The proper rule is, a new trial should not be granted to a party not prejudiced. The defendants here do not contend the verdict was excessive. It is difficult to see how they would be otherwise prejudiced by this argument. It is not germane to other issues." *879 Corkery v. Greenberg, 253 Iowa 846, 854, 114 N.W.2d 327, 331. McGovern v. Inter Urban Railway Co., supra; Grace v. Minneapolis & St. L. Railway, supra; Anno. 2 A.L.R. 2d 454, 470, §§ 12, 13; Cory v. State, supra; Stoner v. Iowa State Highway Commission, 227 Iowa 115, 126, 287 N.W. 269.
For the reasons stated above, this case is affirmed.
Affirmed.
All Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581202/ | 42 So. 3d 258 (2010)
TRIBECA LENDING CORPORATION, a foreign corporation licensed to conduct business in Florida, Appellant,
v.
REAL ESTATE DEPOT, INC., a Florida corporation, Henry Thornton, Rochelle Thornton, Norwest Bank Minnesota, National Association, as trustee, and Debra Dixon, Appellees.
No. 4D09-885.
District Court of Appeal of Florida, Fourth District.
July 14, 2010.
*260 Carlos D. Lerman of Smoler Lerman Bente & Whitebook, P.A., Hollywood, for appellant.
Michael C. Klasfeld, Pompano Beach, for appellee.
WARNER, J.
Tribeca Lending Corporation timely appeals a Final Judgment of Foreclosure of an Equitable Lien, claiming that there are certain defects in the final judgment which need to be corrected. Real Estate Depot cross-appeals the final judgment, arguing primarily that the trial court erred in entering summary judgment in Tribeca's favor and conceding that some defects appear in the summary final judgment. We agree that summary judgment was properly entered. We reverse only to correct the defects in the final summary judgment regarding the parties whose interests are being foreclosed, as well as the court's retention of jurisdiction over the sale proceeds.
In 2004 and 2005, Henry and Rochelle Thornton were facing financial difficulties and were in default under their existing first mortgage on their home. The first mortgagee of the property, Colonial Mortgage Company, brought a foreclosure action against the Thorntons, which ultimately resulted in the entry of an agreed final judgment of foreclosure.
The foreclosure sale relative to the Colonial Mortgage was scheduled to occur on September 29, 2005. However, on the day before the foreclosure sale, Henry Thornton contacted Real Estate Depot and entered into a sale and leaseback on the property in an effort to save the home from foreclosure. It is sufficient for the purposes of this appeal to note that the Thorntons executed a Special Warranty Deed conveying title to their home to Real Estate Depot. Real Estate Depot paid the Thorntons a total of $2,500 at the time of the transaction.
The next day at the foreclosure sale an individual successfully bid on the property on behalf of Real Estate Depot. However, rather than actually paying the entire amount to purchase the property at the foreclosure sale, Real Estate Depot's plan was to simply forfeit the deposit on its bid. This tactic had the effect of preventing a foreclosure sale, at least temporarily. The forfeited deposit was then applied to the Colonial Mortgage.[1]
After Real Estate Depot effectively prevented the property from being sold at the foreclosure sale, Henry Thornton learned *261 that the property was still in foreclosure and that a new foreclosure sale date had been set. Believing that Real Estate Depot did not comply with their agreement, Mr. Thornton sent Real Estate Depot a facsimile in which he attempted to rescind the agreement. Although Mr. Thornton stated that he was rescinding the agreement, he did not return any money to Real Estate Depot.
Subsequently, a quit-claim deed was recorded in the Broward County public records. The quit-claim deed purported to convey the property from Real Estate Depot back to Henry and Rochelle Thornton. The deed showed that Alan Klasfeld, the principal of Real Estate Depot executed the deed. After learning about the deed, Real Estate Depot recorded an Affidavit of Fraudulent Deed in the public records, in which Alan Klasfeld attested that he did not sign the quit-claim deed and stated that his signature on the deed was a forgery. Around the time the deed was recorded, Mrs. Thornton also declared bankruptcy.
After Mr. Thornton attempted to rescind his agreement with Real Estate Depot, he sought to refinance the property through Tribeca Lending Corporation. Mr. Thornton testified that he did not advise Tribeca that there was any challenge to his ownership of the property, nor did he discuss with Tribeca the events that occurred between him and Real Estate Depot or about the deeds involving Real Estate Depot. Ultimately, the Thorntons executed a note and mortgage in the amount of $321,300 in favor of Tribeca. The proceeds of the Tribeca Mortgage were used to satisfy the $265,942.00 balance due under the Colonial Mortgage.
In 2006, Real Estate Depot brought suit against multiple defendants, including the Thorntons and Tribeca, in an action for declaratory relief, damages, and to quiet title to the property. In its amended complaint, Real Estate Depot sought to quiet title against all defendants who may claim an interest in the property. It sought damages against only the Thorntons, for slander of title, and the notary on the quit-claim deed, for violating statutory requirements regarding notarization.
Tribeca answered and filed an Amended Cross-claim and Counterclaim, seeking either to foreclose on its mortgage or, alternatively, to obtain an equitable lien on the property. Real Estate Depot answered Tribeca's counterclaim and raised affirmative defenses of unclean hands and equitable estoppel, claiming that Tribeca "had real or effective notice of the fraud being perpetuated [sic] by the forged deed of Defendants, Henry Thornton and Rochelle Thornton due to numerous irregularities in the closing. . . ."
Tribeca moved for summary judgment as to its counterclaim for the imposition and foreclosure of an equitable lien on the property. It claimed that it was entitled to an equitable lien against the property to the extent that its loan proceeds were used to satisfy the preexisting Colonial Mortgage, a fact which was undisputed. Further, Tribeca asserted that Real Estate Depot's affirmative defenses failed to allege the type of behavior which would amount to unclean hands, arguing that the "unclean hands" defenses raised in the answer were actually in the nature of allegations of negligence. Real Estate Depot filed a response in opposition to the motion for summary judgment, arguing that there were genuine issues of material fact remaining.
After a hearing on Tribeca's summary judgment motion, the trial court entered a Final Judgment of Foreclosure of an Equitable Lien. The final judgment awarded Tribeca an equitable lien against the property in the amount of $265,942, the *262 amount of the Tribeca loan used to satisfy the Colonial Mortgage. The final judgment stated that upon the filing of the Certificate of Sale, the defendants would be foreclosed of all estate or claim in the property. This language had the effect of foreclosing the interest of all defendants, including Tribeca, without foreclosing the interest of Real Estate Depot. In addition the final judgment awarded postjudgment interest to Tribeca, but did not award pre-judgment interest. Finally, the final judgment provided that "[j]urisdiction of this action is retained to enter further orders . . ., including, without limitation, determination of conflicting claims to the proceeds, Plaintiff's damages claims against Defendant, Tribeca Lending Corporation, deficiency judgment, etc., as may be appropriate." This appeal and cross-appeal follow.
Considering first the merits of the final summary judgment, Real Estate Depot argues that genuine issues of material fact exist which preclude summary judgment. In particular, Real Estate Depot argues that 1) there are outstanding claims of "dirty hands" that were not refuted; and 2) equitable subrogation is improper where Tribeca knowingly accepted a mortgage in violation of an automatic stay in bankruptcy. Tribeca contends that those defenses were legally insufficient to negate foreclosure of the equitable lien for the amount of the original first mortgage which it had satisfied.
Because its own mortgage was tainted by the forged deed, Tribeca sought foreclosure only on the basis of an equitable lien. "[A]n equitable lien `is a right granted by a court of equity, arising by reason of the conduct of the parties affected which would entitle one party as a matter of equity to proceed against' certain property." Epstein v. Epstein, 915 So. 2d 1272, 1274-75 (Fla. 4th DCA 2005) (quoting Gables Racing Ass'n v. Persky, 148 Fla. 627, 6 So. 2d 257, 263 (1942)). Equitable liens may be based upon considerations of estoppel or to prevent unjust enrichment. Plotch v. Gregory, 463 So. 2d 432, 436 n. 1 (Fla. 4th DCA 1985). Similarly, the doctrine of equitable subrogation, a twin remedy to the equitable lien, is designed to apply where the claimant satisfied an obligation of another and then stands in the shoes of the satisfied creditor. See Radison Props., Inc. v. Flamingo Groves, Inc., 767 So. 2d 587, 591 (Fla. 4th DCA 2000). Equitable subrogation will be granted to prevent unjust enrichment even though the party seeking it was negligent, as long as there is no prejudice. Suntrust Bank v. Riverside Nat'l Bank of Fla., 792 So. 2d 1222, 1227 n. 3 (Fla. 4th DCA 2001). Furthermore, we have recognized that a refinancing lender is equitably subrogated to the priority of the first mortgage even where it has actual knowledge of an intervening lien. Id. at 1225.
As it is an equitable remedy, a party seeking such a lien must do so with clean hands. Epstein, 915 So.2d at 1275. The clean hands doctrine "applies not only to fraudulent and illegal transactions, but to any unrighteous, unconscientious, or oppressive conduct by one seeking equitable interference in his own behalf." Dale v. Jennings, 90 Fla. 234, 107 So. 175, 180 (1925). Nonetheless, a party asserting unclean hands "must prove that he was injured in order for the unclean hands doctrine to apply." McCollem v. Chidnese, 832 So. 2d 194, 196 (Fla. 4th DCA 2002).
The foregoing principles are illustrated in Palm Beach Savings & Loan Ass'n, F.S.A. v. Fishbein, 619 So. 2d 267 (Fla. 1993), which allowed the imposition of an equitable lien against homestead property in favor of a lender, where the debtor husband fraudulently obtained a loan and used the loan to satisfy three preexisting *263 mortgages on the homestead property without the knowledge of the wife. Mr. Fishbein borrowed $1,200,000 from Palm Beach Savings & Loan Association and secured the debt with a mortgage on the house. Despite its knowledge that Mr. and Mrs. Fishbein were then engaged in dissolution proceedings, the bank permitted Mr. Fishbein to obtain his wife's signature on the mortgage without requiring her to sign the document in the bank's presence. Unknown to either Mrs. Fishbein or the bank, Mr. Fishbein forged his wife's signature to the mortgage. Mr. Fishbein then satisfied the existing mortgages on the property and used the remaining sum for other purposes. After Mr. Fishbein failed to comply with a dissolution agreement, Mrs. Fishbein moved back into the home. In the meantime, the mortgage went into default and the bank initiated foreclosure proceedings.
Because Mrs. Fishbein never signed the mortgage, the bank did not take the position that its mortgage could be foreclosed against the home. However, the question presented to our supreme court in Fishbein was whether an equitable lien could be imposed on homestead real property where Mrs. Fishbein was innocent of wrongdoing. Our supreme court held than even though Mrs. Fishbein was not a party to the fraud, an equitable lien could be imposed to prevent unjust enrichment:
Of course, Mrs. Fishbein should not be made to suffer because the bank was not more careful in ensuring that her signature on the mortgage was genuine. This is why the bank can make no claim against the property for the $270,000 not used to benefit the homestead. On the other hand, Mrs. Fishbein is not entitled to a $930,000 windfall.
Id. at 271.
Similar to Fishbein, Real Estate Depot is not entitled to a windfall by having the Colonial Mortgage paid off with Tribeca's funds. It was undisputed that the proceeds of the Tribeca loan were used to satisfy the preexisting Colonial Mortgage. An equitable lien is necessary to prevent Real Estate Depot from being unjustly enriched by virtue of Tribeca's loan to the Thorntons.
The record also conclusively refutes the affirmative defense of Real Estate Depot that Tribeca had unclean hands. At most, the affirmative defense alleges negligence on the part of Tribeca in failing to discover the recorded affidavit from Mr. Klasfeld regarding the forged quit-claim deed. Mr. Thornton testified that he did not tell Tribeca about the Real Estate Depot transaction. The pleadings and record facts do not show any trickery, fraud, or oppressive conduct by Tribeca which would bar Tribeca from obtaining an equitable lien.
Even assuming Tribeca had actual knowledge that Real Estate Depot was claiming the deed was a forgery, the unclean hands defense still fails as a matter of law on this record. By analogy, in Suntrust, we explained that a refinancing lender is still entitled to be equitably subrogated to the priority of the mortgage it satisfied even where it had knowledge of the intervening lien. Similarly, Real Estate Depot's interest in the property was subordinate to the mortgage of Colonial. When Tribeca satisfied that lien, it was entitled to step into the shoes, so to speak, of Colonial's priority over Real Estate Depot's interest. Regardless of what Tribeca knew, Tribeca's conduct did not harm Real Estate Depot to that extent. In fact, Mr. Klasfeld admitted in his deposition that Tribeca's satisfaction of the Colonial Mortgage would result in a windfall to Real Estate Depot if Tribeca did not receive an equitable lien.
*264 Alternatively, Real Estate Depot alleged that the Tribeca mortgage on the Thornton home was a nullity because of the automatic stay provision of Mrs. Thornton's pending bankruptcy. The automatic stay under bankruptcy law operates as a stay of "any act to create, perfect, or enforce any lien against property of the estate." 11 U.S.C. § 362(a)(4). However, the Thorntons' homestead in this case was property that was exempt from the bankruptcy estate. See 11 U.S.C. § 522(b)(3)(A). Real Estate Depot has not shown that there was any violation of the automatic stay.
Thus, the court correctly entered summary judgment for Tribeca on foreclosure of its equitable lien based upon the Colonial Bank mortgage. The final judgment contains a defect, however, which the trial court should correct on remand. It included boilerplate language stating that upon the filing of the Certificate of Sale, the defendants would be foreclosed of all estate or claim in the property. As Real Estate Depot agrees, this is inaccurate. Because Tribeca was itself a defendant in Real Estate Depot's declaratory judgment action, the language could be construed to foreclose its own interest in the property. In addition, because Real Estate Depot was a plaintiff and counter-defendant, it was not included in the foreclosed interests.
We reject Tribeca's claim that the court erred in failing to award prejudgment interest on the equitable lien amount, because the claim was never raised and thus was waived. Tribeca never filed a motion for rehearing or a motion to address the prejudgment interest issue. In fact, there is no indication in the record that Tribeca ever even raised the issue of its entitlement to prejudgment interest prior to this appeal. See Hi-Shear Tech. Corp. v. United Space Alliance, LLC, 1 So. 3d 195, 204 (Fla. 5th DCA 2008) (holding that where the trial court's failure to award pre-judgment interest was not raised until after the time had expired for filing a motion for rehearing pursuant to Rule 1.530(b), the issue was waived).
Finally, Tribeca claims that the court erred by requiring that the proceeds of any judicial sale be retained pending the resolution of the "conflicting claims" to them. To the extent that the court's order may be interpreted as withholding from Tribeca that portion of the sale proceeds which would satisfy the equitable lien being foreclosed, we agree that the court erred. It had already determined that Tribeca was entitled to an equitable lien and that Real Estate Depot's affirmative defenses to that lien were conclusively refuted. Therefore, Tribeca's right was superior to any other claimant, and it was entitled to the proceeds of sale to the extent that they satisfied that lien. Further, Real Estate Depot does not have any pending claims against Tribeca for damages. Even if it did, the court could not retain the proceeds in advance of any determination of damages. See, e.g., Konover Realty Assocs., Ltd. v. Mladen, 511 So. 2d 705, 706 (Fla. 3d DCA 1987).
Based on the court's imposition of the equitable lien, Tribeca has first priority as to the proceeds of the judicial sale, regardless of any conflicting claims to any remaining proceeds. Therefore, the court's final judgment has the practical effect of restraining proceeds to which Tribeca is entitled. This was error as to the application of the sale proceeds to the equitable lien. To the extent that the sale proceeds exceed the amount of the lien plus interest, those proceeds may lawfully be held pending further orders of the court.
We affirm the final summary judgment except as to the correction of the parties foreclosed and the retention of jurisdiction *265 over the sale proceeds to the extent that they satisfy Tribeca's equitable lien. We reverse on those two issues.
Affirmed in part; reversed in part and remanded for correction of judgment.
TAYLOR and MAY, JJ., concur.
NOTES
[1] See § 45.031(3), Fla. Stat. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2588863/ | 61 N.Y.2d 149 (1984)
In the Matter of Roger A. Bell, Respondent,
v.
Board of Education of Vestal Central School District et al., Appellants.
Court of Appeals of the State of New York.
Decided February 23, 1984.
Earl P. Boyle for Albert J. Guzzi, appellant.
John B. Hogan for Board of Education of Vestal Central School District and another, appellants.
William F. Sheehan for respondent.
Chief Judge COOKE and Judges JASEN, JONES, WACHTLER, MEYER and KAYE concur.
*150SIMONS, J.
On August 1, 1972, petitioner Roger A. Bell was appointed by the Vestal Board of Education as principal of the district's only high school. On October 28, 1977, upon the recommendation of respondent Superintendent of Schools, he was granted tenure. The minutes of the board meetings at which petitioner was appointed and tenured refer to his title respectively as "high school principal" and "senior high school principal." Subsequently, by a resolution adopted July 25, 1978 and revised July 22, 1980 the board determined that the following administrative tenure areas existed in the school district: principal, assistant principal, co-ordinator, psychologist, assistant superintendent and personnel director. Contending that petitioner's tenure area is "principal", respondents transferred him to the position of junior high school principal effective February *151 1, 1982, and the person occupying that position, respondent Albert J. Guzzi, was transferred to petitioner's position as high school principal.[*] Petitioner opposed the transfer and commenced a CPLR article 78 proceeding, seeking a judgment declaring that his tenure area is senior high school principal and an order reassigning him to his former position. The board and Guzzi cross-moved raising affirmative defenses of untimeliness, joinder of necessary parties, and failure to exhaust administrative remedies.
Special Term rejected each of the affirmative defenses. Upon reaching the merits it concluded that the transfer of petitioner to the junior high school was not arbitrary, capricious or contrary to law and it dismissed the petition. The Appellate Division agreed with Special Term's disposition of the affirmative defenses but unanimously reversed on the merits and ordered petitioner's reinstatement. Its order should be reversed and the judgment of Special Term reinstated.
The issue is whether the earlier designation of petitioner in the board's minutes as senior high school principal coupled with the contemporaneous appointment of another individual as "elementary school principal" is sufficient evidence to establish a separate tenure area. If it was, petitioner could not be transferred out of that tenure area without consent, nor could the board retroactively apply the restructuring of tenure areas adopted in 1978 and 1980 to him (see Matter of Baer v Nyquist, 34 N.Y.2d 291, 294). The Appellate Division believed that there was sufficient evidence to establish a separate tenure area of senior high school principal and accordingly found a violation of petitioner's tenure rights.
There are no clearly defined guidelines for determining the scope of administrative and supervisory tenure areas as there are for teacher tenure classifications (see 8 NYCRR part 30). However, a board of education may establish a tenure area for some or all of its administrative employees (Matter of Durso, 19 Ed Dept Rep 72; Matter of Roloff, 16 Ed Dept Rep 274) and principal is a general tenure area recognized by the State Education Department *152 (see Matter of Peterson, 18 Ed Dept Rep 494). It was properly adopted by the board's actions in 1978 and 1980.
Inasmuch as petitioner seeks the benefit of a specific tenure area independent of those subsequently established by the board, he bears the burden of proving its existence (see Matter of Peterson, 18 Ed Dept Rep 494, 496, supra). He does not satisfy that burden solely by evidence that the board minutes of his appointment and grant of tenure described the school to which he was assigned. Petitioner has submitted evidence which indicates several reasons why separate tenure areas might be desirable for schools of different grade levels but that evidence does not support his contention that respondents recognized or accepted those considerations and consciously decided to create separate tenure areas for principals in its district. The board may establish narrow, specific tenure areas, such as high school principal, but it should do so by design and not be bound by descriptive terms used inadvertently in the minutes of petitioner's appointment and grant of tenure.
Our decision is consistent with the view of the Commissioner of Education that references in board minutes to a title such as senior high school principal do not create a tenure area (see Matter of Durso, 19 Ed Dept Rep 72, supra; Matter of Peterson, 18 Ed Dept Rep 494, supra); they merely identify an individual's title and the school to which he or she has been assigned. His view rests upon an apparent effort to encourage the adoption of tenure areas modeled on those promulgated by the Education Department and to limit claims of separate tenure areas acquired inadvertently without board approval.
Because petitioner relied exclusively upon the designations in the board minutes, and the record contains no other evidence that the board adopted specific rather than the general tenure areas recognized by the commissioner, petitioner has failed to meet his burden of proof.
Accordingly, the order of the Appellate Division should be reversed.
On review of submissions pursuant to section 500.4 of the Rules of the Court of Appeals (22 NYCRR 500.4), order reversed, with costs, and the judgment of Supreme Court, Broome County, dismissing the petition reinstated.
NOTES
[*] Petitioner is certified by the Commissioner of Education as both a junior high school and senior high school principal. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581258/ | 919 F. Supp. 235 (1996)
Debbie Ann Cowart MASON, as Administrator of the Estate of Joseph Merrill Mason
v.
SHELBY COUNTY HEALTH CARE CORPORATION d/b/a The Regional Medical Center at Memphis and Elvis Presley Memorial Trauma Center, and Dr. Timothy Gavin, M.D.
No. 3:95CV717LN.
United States District Court, S.D. Mississippi, Jackson Division.
February 8, 1996.
*236 D. Elizabeth Featherston, Jackson, MS, for plaintiff.
Stephen P. Kruger, Stuart B. Harmon, Upshaw, Williams, Biggers, Page & Kruger, Jackson, MS, Heber S. Simmons, III, Armstrong, Allen, Prewitt, Gentry, Johnson & Holmes, Jackson, MS, George Q. Evans, Wise, Carter, Child & Carawa, Jackson, MS, for defendants.
MEMORANDUM OPINION AND ORDER
TOM S. LEE, District Judge.
This cause is before the court on the motion of defendant Timothy Gavin, M.D., to dismiss for lack of personal jurisdiction and improper venue pursuant to Rules 12(b)(2) and 12(b)(3) of the Federal Rules of Civil Procedure. Plaintiff Debbie Ann Cowart Mason has responded to the motion and the court, having considered the memoranda of authorities together with attachments submitted by the parties, concludes that this court is without personal jurisdiction over defendant Gavin and that therefore, his motion is well taken and should be granted.
As recounted in an earlier opinion entered by the court in this cause, plaintiffs decedent, Joseph Merrill Mason, was involved in a train/truck collision in Holmes County, Mississippi on September 28, 1994. He was initially transported to and treated at the emergency room of the Methodist Hospital in Lexington, Mississippi. However, the treating physician there, Dr. Aubrey Hinton, sought to transfer him to Shelby County *237 Health Care Corporation and/or Elvis Presley Memorial Hospital Trauma Center and/or the Regional Medical Center at Memphis (the Med) in Memphis, Tennessee.[1] Toward that end, Dr. Hinton spoke with Dr. Timothy Gavin, an emergency room physician at the Med, who agreed to accept the transfer of Mason. A helicopter was dispatched to Mississippi to pick up Mason and transport him to the Med, accompanied by two registered nurses, defendants Charlotte Heidi and Kathleen Storey. Plaintiff alleges in the complaint in this cause that these two nurses, after consulting with Dr. Gavin by phone from Lexington, administered the drug Tracrium to Mr. Mason. She alleges that this drug was inappropriate under the circumstances and ultimately caused Mason's death.
On the present motion, defendant Gavin challenges this court's jurisdiction over him under both prongs of the usual jurisdictional inquiry. That is, he maintains both that he does not have the requisite "minimum contacts" with Mississippi to satisfy due process notions of "fair play and substantial justice," International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct. 154, 158, 90 L. Ed. 95 (1945), and that he committed no tort in Mississippi so that he is not amenable to service of process under this state's long-arm statute, Miss.Code Ann. § 13-3-57. Further, on the same reasoning that he committed no tort here, Gavin asserts that this forum is not a proper venue for this action. See 28 U.S.C. § 1391(a). Finally, he argues that even if the court were to conclude that it has personal jurisdiction over him and that this is an appropriate venue, he would still be entitled to dismissal for the reason that he was a University of Tennessee medical resident at the time of the events giving rise to this cause and thus enjoys immunity from suit under the Eleventh Amendment. To resolve this motion, the court finds it necessary to address only the first of Gavin's arguments, relating to due process.
Before a court may exercise jurisdiction over the person of a nonresident defendant consistent with due process, that defendant must have "minimum contacts" with the forum state and the "maintenance of the suit [must] not offend `traditional notions of fair play and substantial justice.'" International Shoe, 326 U.S. at 316, 66 S.Ct. at 158; Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 105, 107 S. Ct. 1026, 1029, 94 L. Ed. 2d 92 (1987). This means that before this court may exert jurisdiction over Dr. Gavin, it is essential that the plaintiff identify some act or acts by which he purposefully availed himself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws. See Hanson v. Denckla, 357 U.S. 235, 250-53, 78 S. Ct. 1228, 1238-40, 2 L. Ed. 2d 1283 (1958).
There is no contention here that Gavin had "sufficient systematic and continuous" contacts with Mississippi to support an exercise of "general" jurisdiction. In fact, as detailed infra, the only contacts identified are communications relating to plaintiff's decedent. Thus, the issue is whether the court may exercise "specific jurisdiction," or "personal jurisdiction based on contacts with the forum that are related to the particular controversy." Southmark Corp. v. Life Investors, Inc., 851 F.2d 763, 772 (5th Cir.1988). Of course, for specific jurisdiction, the defendant must have "minimum contacts" with the forum state, but the standard for gauging the sufficiency of contacts is lower for a specific jurisdictional inquiry than for an inquiry into the existence of general jurisdiction. Indeed, when the cause of action arises from the contact, i.e., for specific jurisdiction, "[e]ven a single purposeful contact may in a proper case be sufficient to meet the requirement of minimum contacts." Id.; see also Hydrokinetics, Inc. v. Alaska Mechanical, Inc., 700 F.2d 1026, 1028 (5th Cir.1983) ("jurisdiction over the person of a defendant may be predicated on a single purposeful act of the defendant"). Here, plaintiff asserts that Dr. Gavin undeniably purposefully sought to invoke the benefits and protections of Mississippi law "[b]y undertaking to provide medical care and thus practicing medicine in Mississippi." However, the court concludes that his contacts *238 with Mississippi are plainly insufficient to satisfy the minimum contacts requirement.[2]
It is undisputed that Gavin's only contacts with Mississippi were telephone conversations with health care providers in Mississippi concerning Joseph Mason. More particularly, the record reflects that Gavin participated in four telephone calls from Mississippi regarding Mason.[3] The first was from Dr. Aubrey Hinton at the Methodist Hospital in Lexington, Mississippi, asking that Mason be accepted for transfer. In that conversation, Gavin discussed the patient's condition with Dr. Hinton and agreed to accept the transfer. The second call to Dr. Gavin was also from Dr. Hinton, who called to "reiterate" certain information about Mason's condition. In the third, nurse Charlotte Heidi telephoned Dr. Gavin from the hospital in Lexington to advise that they were preparing for the return flight and to "let [Gavin] know what [was] going on and how bad [Mason] look[ed]." The fourth call to Dr. Gavin was from a Dr. John Lucas, the general surgeon at Greenwood-LeFlore Hospital in Greenwood, Mississippi, who telephoned Dr. Gavin to discuss Mr. Mason's condition after Mr. Mason went into full cardiac arrest during the return flight and an emergency landing was made at the Greenwood hospital for assistance. At no time did Gavin himself initiate any contact with anyone in Mississippi about Mr. Mason or about his case. Rather, he merely received these four calls from others in Mississippi concerning Mr. Mason.
While a single contact can be a sufficient basis upon which to predicate specific jurisdiction, that single contact must be "purposeful," and directed at the forum. See Bullion v. Gillespie, 895 F.2d 213, 217 (5th Cir.1990); Hydrokinetics, 700 F.2d at 1028. The court in Bullion observed:
It is well settled that specific jurisdiction may arise without the nonresident defendant's ever stepping foot upon the forum state's soil or may arise incident to the commission of a single act directed at the forum. The appropriate inquiry is whether the defendant purposefully availed [himself] of the privilege of conducting activities in-state, thereby invoking the benefits and protections of the forum state's laws.
Bullion, 895 F.2d at 217. From this, it follows that "[t]he unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State." Hydrokinetics, 700 F.2d at 1028. On this reasoning, the Fifth Circuit has held specifically "[t]elephone calls made from the forum state to the nonresident defendant represent an insufficient basis for the forum's assertion of jurisdiction over the nonresident." Thompson v. Chrysler Motors Corp., 755 F.2d 1162, 1171 (5th Cir.1985); cf. Brown v. Flowers Indus., Inc., 688 F.2d 328, 333 (5th Cir.1982) (upholding Mississippi district court's assertion of jurisdiction over nonresident on basis of single telephone call placed by the nonresident to the Mississippi plaintiff).[4]
In the case at bar, plaintiff relies heavily on the Fifth Circuit's opinion in Bullion v. Gillespie, 895 F.2d 213 (5th Cir.1990), for her contention that Dr. Gavin's contacts with *239 Mississippi amount to such purposeful availment as would support jurisdiction. Bullion, though, is obviously significantly distinguishable. In finding that the Texas plaintiff there had made a prima facie showing of jurisdiction over the nonresident physician, the Brown court did rely, in part, on the plaintiff's assertion that a physician/patient relationship had been established between the plaintiff and the physician. However, there were substantial other factors contributing to the court's ruling, most notably the facts that the nonresident physician had shipped drugs to the plaintiff from California to Texas on three occasions, for which he had received payment from the plaintiff, and had maintained "regular" telephone contact with plaintiff's Texas physician about her condition.[5] Given these apparent distinctions, Bullion adds nothing to plaintiffs position.
In the case at bar, the court recognizes that plaintiff is not seeking to hold Dr. Gavin liable for answering the phone but rather for undertaking to provide what she contends is negligent medical care.[6] For jurisdictional purposes, though, and apart from the merits of this claim, what is relevant to the court is the fact that Dr. Gavin never initiated any contact whatsoever with Mississippi that could potentially subject him to jurisdiction in this forum. Rather, he merely received a limited number of phone calls from persons in Mississippi. Such unilateral activity by others is insufficient to support this court's exercise of jurisdiction. Accordingly, this court will grant Gavin's motion to dismiss for lack of personal jurisdiction.[7]
It is, therefore, ordered that defendant Gavin's motion to dismiss for lack of personal jurisdiction is granted.
NOTES
[1] In a motion to dismiss filed earlier by the Med, it was explained that Shelby County Health Care Corporation operates the Elvis Presley Memorial Hospital Trauma Center and the Regional Medical Center at Memphis as divisions.
[2] If the court were to conclude that minimum contacts did exist, the court would then reach the fairness prong of the specific jurisdiction inquiry, which requires that it "examine the relationship among the defendant, the forum, and the litigation to determine whether maintaining the suit offends traditional notions of fair play and substantial justice." Southmark Corp. v. Life Investors, Inc., 851 F.2d 763, 772 (5th Cir.1988). Since the court concludes here that the minimum contacts requirement is not met, the court does not consider the fairness issues.
[3] Both parties have provided the court with transcripts of twelve telephone calls from Mississippi to the Med in Memphis about plaintiff's decedent. Dr. Gavin participated in only four of those calls. It is noted, as well, that while the parties have represented that these transcripts represent all of the conversations with Dr. Gavin concerning Mr. Mason, these transcripts do not reflect that Dr. Gavin advised or participated in the decision to administer Tracrium to plaintiff's decedent.
[4] The Thompson court distinguished Brown on the very basis that the telephone call in Brown was made to Mississippi whereas the telephone call in Thompson was made from Mississippi. Thompson, 755 F.2d at 1171.
[5] In Bullion, a Texas resident filed suit in Texas against Gillespie, a California physician, charging medical malpractice and deceptive trade practices relating to his having provided her with certain experimental drugs to treat a condition from which Bullion suffered. Bullion had learned of Gillespie's work with her particular ailment from her local physician, Reeves, who had read a book authored by Gillespie on the subject. Reeves communicated with Gillespie to discuss Bullion's problem and the two developed a professional relationship. Upon Reeves' referral, Bullion went to California for a consultation with Gillespie, and was invited by Gillespie to participate in an experimental treatment program which he was administering. She agreed and returned to Texas. As part of the program, Gillespie mailed the drug "angiostat" and some related correspondence to Bullion in Texas on three separate occasions. Bullion continued to see Reeves, who agreed to supervise her progress and report his findings to Gillespie in California. For her part, Bullion made a series of payments to Gillespie for medical services and drugs received.
Under those facts, the Fifth Circuit concluded that Bullion had presented a prima facie case for personal jurisdiction over Gillespie. The court said,
We must accept as true Bullion's assertion that Gillespie shipped to her, in Texas, drugs that proximately caused her injuries. Moreover, ... Bullion was Gillespie's patient for purposes of the experimental program and ... Gillespie received compensation for her services.... Gillespie maintained regular telephone contact with Reeves and administered to the medical needs of other patients in Texas as well. Thus, aggregating these separate contacts with Texas, we conclude that personal jurisdiction over the defendant comports with the due process requirement of "minimum contacts."
Bullion, 895 F.2d at 217.
[6] In her brief, plaintiff remarks that she does not attempt to hold him liable for answering the phone and that "Gavin was not on duty as a receptionist but as a physician."
[7] Because the court concludes that Gavin's contacts do not satisfy the due process requirements for jurisdiction, the court need not address whether his alleged acts amounted to the commission of a tort in part in Mississippi so as to satisfy Mississippi's long-arm statute. The court does note that in its earlier opinion concluding that plaintiff had made a prima facie showing of jurisdiction over the Med, the court did not specifically confront and address this issue because the Med never contended that Dr. Gavin did not commit a tort in Mississippi. In that motion, the Med impliedly conceded that plaintiff had alleged the commission of a tort in Mississippi and the only issue for the court was whether Dr. Gavin was the Med's agent. The issue of whether he committed a tort in Mississippi was never directly placed before the court. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581257/ | 147 N.W.2d 200 (1966)
Phillip OLDIS and Helen Oldis, Appellees,
v.
JOHN DEERE WATERLOO TRACTOR WORKS, INC. and John Deere Co., Appellants, and
Iowa Public Service Company, Defendant (not appealing).
No. 52326.
Supreme Court of Iowa.
December 13, 1966.
*201 Shuttleworth & Ingersoll, Cedar Rapids, for appellants.
Jack C. White, and John T. Nolan, Iowa City, for appellees.
LARSON, Justice.
This is an interlocutory appeal to determine whether the district court erred in setting aside the sustaining of a special appearance filed by John Deere Waterloo Tractor Works, Inc. and John Deere Co., named defendants in an action seeking damages as a result of an accident to plaintiff Phillip Oldis while working on appellants' premises. Although there is another defendant in this action, we shall herein designate the above-named as the defendants.
There are several questions raised in this appeal, but the vital issue presented is whether sufficient grounds appear in the record to sustain the trial court's action in vacating and setting aside its own order of December 7, 1965, sustaining defendants' special appearance. We think so.
I. Some general rules of procedure should be first considered. A petition to vacate a judgment under rules 252 and 253 is not triable de novo on appeal. Windus v. Great Plains Gas, 255 Iowa 587, 593, 122 N.W.2d 901, and citations. If there is conflict in the record, or if different inferences may reasonably be drawn from the facts, the trial court's findings have the effect of a jury verdict. Svoboda v. Svoboda, 245 Iowa 111, 122, 60 N.W.2d 859, 865, 866. It is also well settled that in passing upon such a petition the trial court has considerable discretion, and we have said we will not reverse unless an abuse is shown. Svoboda v. Svoboda, supra, and citations; Windus v. Great Plains Gas, supra. Of course this discretion is not final or conclusive; it must have some support in the record. Nevertheless, we have said we will be more reluctant to find an abuse of discretion where the judgment has been set aside than where relief has been denied. Ferris v. Wulf, 216 Iowa 289, 291, 249 N.W. 156, 157. This court has consistently adhered to the policy of disposing of controversies on their merits, and not on fine procedural or technical distinctions. First National Bank of Newton v. Federal Reserve Bank, 210 Iowa 521, 527, 231 N.W. 453, 69 A.L.R. 1329; Ferris v. Wulf, supra. True, some of these cases predicated the holding on a showing of "mistake, inadvertence, surprise, excusable neglect or unavoidable casualty" now found in rule 236 as a basis for setting aside a default, and we decided in Windus v. Great Plains Gas that there was a wide difference between those requirements and the ones found in rule 252, yet no general rule could be laid down which would govern all cases involving motions to set aside defaults or vacate judgments. Each case must be determined on its own facts. Svoboda v. Svoboda, supra; Tate v. Delli, 222 Iowa 635, 640, 269 N.W. 871, 873.
Rule 252, R.C.P., provides: "Upon timely petition and notice under rule 253 the court may correct, vacate or modify a final judgment or order, or grant a new trial on any of the following grounds: (a) Mistake, neglect or omission of the clerk; (b) Irregularity or fraud practiced in obtaining the same; * * * (e) Unavoidable casualty or misfortune preventing the party from prosecuting or defending; * * *." "Unavoidable casualty" is defined in Black's Law Dictionary, Fourth Ed., at page 1693, as "An event or accident which human prudence, foresight, and sagacity cannot prevent, happening against will and without negligence. (Citations) Within the meaning of statutes in several states relating to the vacation of judgments, means some casualty or misfortune growing out *202 of conditions or circumstances that prevented the party or his attorney from doing something that, except therefor, would have been done, and does not include mistakes or errors of judgment growing out of misconstruction or understanding of the law, or the failure of parties or counsel through mistake to avail themselves of remedies, which if resorted to would have prevented the casualty or misfortune." (Emphasis supplied.) Thus, the nub of this controversy seems to be whether under this record the plaintiffs' attorneys were guilty of carelessness or inattention to duty and whether this was so clear as to compel a rejection of their petition under rule 252.
II. From the record we learn that, pursuant to an injury incurred on defendants' premises October 10, 1963, plaintiffs brought an action for damages against these defendants and the Iowa Public Service Co. on September 8, 1965, and served notice on these defendants on the 9th day of September, 1965, by delivering a true copy of said notice, with petition attached, to Harley Waldon, who was designated the "general manager of said defendant company."
On September 28, 1965, defendants filed a special appearance, and later a supplemental special appearance with affidavit on October 7, 1965, in which it was alleged that "neither of said purported defendants exist." On October 28, 1965, defendants filed a request for oral argument on its special appearance, and only one of plaintiff's attorneys received a copy thereof.
On December 7, 1965, a regular motion day in the district, the court apparently overlooked the request for oral argument and sustained the special appearance. Upon receipt of notice of that ruling plaintiffs' counsel prepared and presented to the court a motion to set aside and vacate it. The court forthwith on December 15, 1965, granted that motion and entered an ex parte order setting aside its December 7th ruling.
It appears appellants' counsel did not receive notice of this December 15th order from the clerk, but learned of it through plaintiffs' counsel on or about March 3, 1966, when inquiry was made as to a time of hearing on the pending special appearance. Appellants' motion, denominated as "Additional Supplemental Special Appearance * * *," followed, in which they asked that the December 15, 1965, order be expunged from the record, be declared null and void, and the ruling of December 7, 1965, be reinstated. Hearing thereon was held March 18, 1966, and arguments on the merits of the original and supplemental special appearances were presented to the court.
Subsequent thereto and prior to any court ruling thereon, on March 25, 1966, plaintiffs filed a petition pursuant to rule 252, R.C.P., in which they asked the court to vacate its order of December 7, 1965, sustaining defendants' special appearance. As grounds therefor it alleged that due to the "[m]istake, neglect or omission of the clerk," one of their Iowa City counsel did not receive a copy of defendants' special appearance, supplemental special appearance, affidavits or request for oral argument filed prior to the December 7th order; that through an irregularity in the usual practice the court entered a ruling on the special appearance without first permitting an oral argument as was requested by defendants in writing, a practice relied upon by plaintiffs' counsel who had received a notice of that request; that by virtue of unavoidable casualty the court's ruling on defendants' special appearance was filed before plaintiffs could present their prepared oral argument and brief in resistance thereto, and that they were prepared to submit written briefs and present oral arguments to the court at any time fixed in response to defendants' request.
The petition further alleged that, had the clerk properly delivered to defendants' counsel a copy of plaintiffs' motion to set aside the December 7th ruling which was filed December 15, 1965, and a resistance *203 had been timely filed, plaintiffs could have asked for the correction of the December 7th order during that term under rules 236 or 244, R.C.P., and that since the clerk's neglect was not discovered until the next term, further "unavoidable casualty" occurred.
In response, appellants again attacked appellees' petition by way of special appearance asserting the nonexistence of the named parties as corporations or legal entities. On the 19th of April, 1966, a hearing on plaintiffs' petition under rules 252 and 253 was held. On May 12, 1966, the court upheld appellants' contention that its December 15, 1965, order was ex parte and void, and vacated that order. However, it also sustained plaintiffs' request for relief from the December 7, 1965, order, and set aside and vacated the original order sustaining defendants' special appearance. Defendants appeal.
III. Plaintiffs apparently concede, for the purpose of this appeal, that the court's order of December 7, 1965, was a final judgment, and that its order of December 15, 1965, was a nullity.
In all proceedings to set aside rulings by the trial court such as default judgments (rule 236), motions for new trial (rule 244), and vacation or modification of judgments (rule 252), the burden to show good cause is placed upon the movant. Edgar v. Armored Carrier Corp., 256 Iowa 700, 704, 128 N.W.2d 922, and citations; Windus v. Great Plains Gas, supra; rule 253, R.C.P.
Thus, in the instant case appellees had the burden to set forth and establish facts which, together with all favorable inferences to be drawn therefrom, would support and justify the court's action in vacating its order and judgment of December 7, 1965, which of course was far more than a preliminary motion. In sustaining appellants' special appearance, the cause as to them was terminated except for the right of appeal and a timely petition under rules 252 and 253.
IV. There is no contention made that appellees' petition under rule 252 was not timely filed, so the sole issue before us is whether the showing made to the trial court was sufficient to sustain its discretion in vacating the December 7th order.
Appellants contend the grounds set forth in appellees' petition were irrelevant or insufficient to excuse them from responsibility for the court's action on a regular motion day in Black Hawk County, that things done or not done after the December 7th order would not tend to show the neglect or unavoidable casualty required to justify setting aside the judgment procured on that date, and that what they did or failed to do would not support a finding of "unavoidable casualty."
Appellees contend the "neglect" of the clerk to send copies of all motions and applications to the adverse parties, both prior to and after the December 7th order, caused them to be confused and misled as to the status of the case and did not alert them to the necessity of prompt action. They contend there was irregularity in the entry of that order, for they believed when there was an application before the court for oral argument on a matter of this importance pursuant to rule 117, R.C.P., the court would not rule one way or the other without setting a time for and conducting a hearing thereon, that their reliance upon that practice and the copy of the defendants' application was justified, and that those circumstances warranted a conclusion of "unavoidable casualty" under rule 252, R.C.P.
It is true, we said in Windus v. Great Plains Gas, supra, that there is no inclusion in rule 252 of any right to vacate a judgment for mistake, inadvertence, or excusable neglect, that there is a difference between those terms and "unavoidable casualty or misfortune," and that mistake, inadvertence, or neglect of a party or his attorney will not satisfy this rule. However, *204 the appellees and the court here believed there was more than neglect, mistake and inadvertence shown. Prudence and foresight, if they include the probability that the court would overlook defendants' request for an oral argument, possibly could have avoided the ruling, but a like request from appellees might well have been also overlooked on December 7th, the motion day in that district.
In most jurisdictions with like statutes, good grounds for vacation of judgments "means some casualty or misfortune growing out of conditions or circumstances that prevented the party or his attorney from doing something that, except therefor, would have been done." Black's Law Dictionary, Fourth Ed., page 1693, supra. As we have pointed out, the only thing appellees' attorneys might have done before default day was file a like application for oral argument and get it set for a time certain. They were not local counsel and did not expect the request already made would not be pursued properly. We think the court was, under these circumstances, justified in finding they were not so negligent as to prevent the vacation of the judgment unexpectedly rendered against them.
The same judge presided over all these proceedings, knew counsel for the various parties were all nonresidents of that county, and was well aware of the situation surrounding these applications, motions and rulings. The court, having heard the arguments on the merits of appellants' contentions and on the special appearance issue, must have concluded appellees' resistance to the special appearances of appellants had merit. In any event, it is clear the court could decide it had overlooked the request for oral argument filed after the special appearance and would not have so ruled had it been aware of the application, that appellees were misled through no fault of their own in expecting appellants to arrange a time for that requested hearing. As previously pointed out, the court has a wide discretion in resolving this issue, and we will not disturb its order vacating a judgment if it has any support in the record. Thompson v. Miller, 251 Iowa 324, 329, 100 N.W.2d 410, and citations. This appears to be a matter that should be considered upon its merits and, observing the rule that courts are much more reluctant to find an abuse of discretion where the judgment has been set aside than where relief has been denied, we conclude the action of the trial court in vacating and setting aside its own order of December 7, 1965, must be sustained.
Affirmed.
GARFIELD, C. J., and SNELL, MOORE, MASON, RAWLINGS and BECKER, JJ., concur.
STUART, J., takes no part.
THORNTON, J., not sitting. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581254/ | 919 F. Supp. 589 (1996)
IRON WORKERS DISTRICT COUNCIL OF WESTERN NEW YORK AND VICINITY WELFARE AND PENSION FUNDS, et al., Plaintiffs,
v.
BUTLER FENCE CO., INC., Defendant.
Civil A. No. 93-CV-467.
United States District Court, N.D. New York.
March 19, 1996.
*590 *591 Blitman & King, Syracuse, NY, for Plaintiffs (Jennifer A. Clark, of counsel).
Bond, Schoeneck & King, L.L.P., Syracuse, NY, for Defendant, (Thomas G. Eron, of counsel).
MEMORANDUM-DECISION AND ORDER
POOLER, District Judge.
INTRODUCTION
In this lawsuit under the Employee Retirement Income Security Act ("ERISA") and the Labor Management Relations Act ("LMRA"), plaintiffs Iron Workers District Council of Western New York and Vicinity Welfare and Pension Funds, et al. ("Iron Workers Fund") move for partial summary judgment against defendant Butler Fence Co., Inc. ("Butler"). Plaintiffs also seek an order compelling Butler to produce documents relating to the earnings of its employees. Because issues of fact control virtually every aspect of this case, summary judgment is denied. In addition, I deny plaintiffs' motion to compel discovery without prejudice to its renewal before the magistrate judge.
BACKGROUND
Butler is a Syracuse company that employs approximately 20 people full-time in the installation of commercial and residential fences. According to Neil R. Austin, Butler's president, the company occasionally employs workers who are members of the Iron Workers Local Union No. 60 (the "union") for specific jobs at the request of the project's general contractor, the property owner, or a union representative. Austin Aff. of 1/6/95, ¶ 9. Butler's full-time employees, however, are not union members. Iron Workers Fund administers fringe benefit plans for the benefit of union members. According to Austin, when Butler occasionally employed union workers, the company paid them at the current union wage rate and made fringe benefit contributions on their behalf to Iron Workers Fund. Id.
A. Collective bargaining agreements
The union and the Construction Employers Association of Central New York ("Construction Association") negotiated collective bargaining agreements in 1983, 1986 and 1989 for the benefit of union workers. Butler is not a member of the Construction Association. The collective bargaining agreements require employers to contribute to Iron Workers Fund on behalf of union workers in amounts correlating to the number of hours worked. See Pl. Rule 7.1(f) Statement, Ex. A ("1983 Agreement"), Art. 9a & 9b; Ex. B ("1986 Agreement"), Art. 9a & 9b. Butler signed the 1983 and 1986 collective bargaining agreements as an individual employer but did not sign the 1989 agreement. Austin Aff. of 1/6/95, ¶ 10.
The parties sharply dispute the circumstances under which Butler signed the 1986 Agreement, which is central to this lawsuit. Butler President Austin contends that he signed the 1986 Agreement because union business agent Ronald McDermott visited Butler's offices and told Austin that the 1986 Agreement would cover only work related to a then current project along Route 81 in Mattydale. Austin Aff. of 1/6/95, ¶ 6. Two Butler employees who were in the office during Ronald McDermott's 1986 visit generally corroborate Austin's version of events. Froio Aff. of 1/6/95, ¶ 2; Singer Aff. of 1/6/95, ¶ 2. In contrast, union officials deny ever stating that the 1986 Agreement was a limited project agreement. Ronald McDermott claims that his brother, union President Kevin McDermott, obtained Austin's signature on the 1986 Agreement and that neither the 1983 Agreement nor the 1986 Agreement was limited to the Route 81 project. R. McDermott Aff. of 12/13/94, ¶¶ 5, 8-9. Kevin McDermott contends that he was present when Austin signed the 1986 Agreement and that he told Austin the 1986 Agreement was not limited to the Route 81 project. K. McDermott Aff. of 12/13/94, ¶¶ 6-7. The 1986 Agreement itself does not limit its application to the Route 81 project.
The parties also dispute the termination date of the 1986 Agreement. Iron Workers *592 Fund argues that the contract automatically renewed itself and was effective through May 31, 1992, which is four months after Butler submitted a written termination notice. See 1986 Agreement, Art. 54. Butler acknowledges sending a termination letter to the union on January 24, 1992. Austin Aff. of 1/6/95, ¶ 17 & Ex. B. However, the letter clearly states that Butler made the termination without waiving its argument that the 1986 Agreement was a project agreement limited to the Route 81 project. Id. Ex. B.
B. Audits by Iron Workers Fund
The scope and termination date of the 1986 Agreement determines the extent of any fringe benefit contributions Butler owes Iron Workers Funds. Both the 1983 and 1986 agreements between the union and Butler incorporate Iron Workers Fund's trust agreements, which permit the fund to audit the books of contributing employers. See, e.g., Pl. Rule 7.1(f) Statement, Ex. F, Art. 9, § 1. Under this authority, Iron Workers Fund audited Butler's records for several projects during the period August 1985 through May 1989. According to this audit, Butler owed Iron Workers Fund $3,545.62. Id. Ex. N. By letter dated December 5, 1989, plaintiffs demanded payment from Butler of $5,364.16, which covered the delinquent contributions and applicable interest and penalties. Austin Aff. of 1/6/95, Ex. A. Butler never paid the alleged debt.
The union also audited Butler's records for the period March 1985 through February 1986 and determined that Butler owed $122,168 in delinquent fringe benefit contributions.[1] By letter dated July 15, 1991, Iron Workers Fund demanded payment from Butler of $264,405.81, which included the delinquent contributions, interest and penalties. Pl. Rule 7.1(f) Statement, Ex. Q. According to plaintiffs, this audit did not include 16 projects for which they requested additional information. Id. Butler never supplied the information, and Iron Workers Fund has not audited Butler's records for the period March 1986 through May 1992.
Iron Workers Fund commenced this lawsuit on November 30, 1992, to, among other things, collect the delinquent fringe benefit contributions already calculated and to compel Butler to produce its records for another audit.[2] Butler filed a counterclaim against the union stating that it fraudulently induced Butler to sign the 1986 Agreement and seeking indemnification if Butler was found liable under the contract for fringe benefit contributions. During discovery, Iron Workers Fund requested Butler's records in order to compute additional delinquent contributions. Butler refused the request. Although the parties met with Magistrate Judge Gustave J. Di Bianco regarding their dispute, he never ruled on the matter.
Plaintiffs now seek to compel Butler to produce its books and records for discovery. Iron Workers Fund also seeks summary judgment regarding its right to audit Butler's records and Butler's obligation to pay the funds delinquent contributions. Finally, plaintiffs seek to dismiss Butler's counterclaim against the union. Butler opposed the motions in all respects. Oral argument took place on February 6, 1995.
DISCUSSION
I. Summary Judgment Standard
Summary judgment shall enter if, when viewing the evidence in the light most favorable to the nonmovant, the court determines that there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Eastman Kodak Co. v. Image Technical Servs., Inc., 504 U.S. 451, 456, 112 S. Ct. 2072, 2076, 119 L. Ed. 2d 265 (1992). A party seeking summary judgment must demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). If the movant satisfies this initial burden, *593 then the burden shifts to the nonmovant to proffer evidence demonstrating that a trial is required because a disputed issue of fact exists. Weg v. Macchiarola, 995 F.2d 15, 18 (2d Cir.1993). The nonmovant must do more than present evidence that is merely colorable, conclusory, or speculative and must present "concrete evidence from which a reasonable juror could return a verdict in his favor...." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S. Ct. 2505, 2514, 91 L. Ed. 2d 202 (1986). The nonmovant must do more than show "some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S. Ct. 1348, 1355, 89 L. Ed. 2d 538 (1986).
II. Scope of the 1986 Agreement
The chief dispute between Iron Workers Fund and Butler is whether Butler paid all of the fringe benefit contributions it owed, and resolution of this dispute depends upon the scope of the 1986 Agreement. If the 1986 Agreement was a project agreement covering only the Route 81 project, as Butler contends, then the employer has satisfied its contribution obligation. However, if the 1986 Agreement was a collective bargaining agreement covering all projects through May 31, 1992, as plaintiffs contend, then Butler owes delinquent contributions, although the amount of that liability is undetermined.
A. Oral modification
Butler contends that it does not owe additional contributions to Iron Workers Fund because the 1986 Agreement was limited to work performed on the Route 81 project. Butler relies on the terms of an oral modification to the written contract. In addition to denying the existence of the oral limitation, Iron Workers Fund responds that the contract terms could not be so modified. Plaintiffs argue that they are entitled to rely on the contract's written terms and that Butler's contract defenses against the union, if any, are ineffective against the fringe benefit fund.
By its terms, the 1986 Agreement remained in effect through May 31, 1989, and extended automatically for one-year increments if neither party gave written termination notice. 1986 Agreement, Art. 54. The contract did not limit its application to a single project. In an article of the contract entitled "Craft Jurisdiction," the 1986 Agreement states that "the jurisdiction of work covered by this Agreement is that provided for in the [union's] charter grant." Id. Art. 1. In addition, the contract stated that "[t]his Agreement contains all of the provisions agreed upon by the Employer and the Union. Neither the Employer nor the Union will be bound by rules, regulations or agreements not herein contained except interpretations or decisions of the Board of Arbitration." Id. Art. 52.[3]
There is no requirement that a collective bargaining agreement be written. American Fed'n of Television & Radio Artists v. Inner City Broadcasting Corp., 748 F.2d 884, 887 (2d Cir.1984). Technical rules of contract do not determine whether a collective bargaining agreement is formed. Id. at 886-87. Federal labor law is flexible enough to permit courts to consider oral agreements "within the context of the overall labor-management agreement package." Ehrenburg v. Outokumpu Am. Brass, Inc., 808 F. Supp. 973, 980 (W.D.N.Y.1992). Like any contract, however, a collective bargaining agreement is completely integrated if the parties intend it to be the expression of their entire agreement, and under these circumstances evidence of contemporaneous oral modifications is inadmissible. Merk v. Jewel Food Stores, 945 F.2d 889, 892-93 (7th Cir. 1991), cert. denied, 504 U.S. 914, 112 S. Ct. 1951, 118 L. Ed. 2d 555 (1992). However, if the parties intend the writing to be a final expression of the written terms but not a complete expression of all the necessary terms, then the writing is partially integrated and parol evidence of additional consistent terms is admissible. Id. Whether a writing is integrated is a question of law. Id. at 893.
*594 Thus, certain oral modifications to collective bargaining agreements are permissible. For example, in a case involving an expired collective bargaining agreement, the Second Circuit held that conflicting evidence raised an issue of fact as to whether the parties orally agreed to extend the effective date of their contract pending further negotiations. Local 74, Serv. Employees Int'l Union v. Ecclesiastical Maintenance Serv., Inc., 55 F.3d 105, 108-09 (2d Cir.1995). Similarly, a district court found that conflicting evidence raised an issue of fact as to whether an employer and union orally agreed to modify the terms of their existing collective bargaining agreement to alter the seniority rights of some journeymen. Ehrenburg, 808 F.Supp. at 979-80.
I reject plaintiffs' contention that the 1986 Agreement's terms as a matter of law did not permit any oral modifications. The 1986 Agreement contains an integration clause at Article 52, but it does not explicitly state that all modifications must be in writing. Thus, the contract itself does not prohibit oral modifications, and I must look to the intentions of the parties to determine whether the alleged modifications were effective. See Ecclesiastical Maintenance, 55 F.3d at 109. Examination of the parties' intent is a question of fact. Marine Transport Lines, Inc. v. International Org. of Masters, Mates & Pilots, 878 F.2d 41, 44 (2d Cir.1989), cert. denied, 493 U.S. 1022, 110 S. Ct. 724, 107 L. Ed. 2d 743 (1990).
Furthermore, it is undisputed that Butler and the union orally modified the terms of the 1986 Agreement to apply only to Butler's commercial projects and not its residential projects. Eron Aff. of 1/6/95, Ex. A, R. McDermott Dep. of 4/12/94, at 85; Id. Ex. B, K. McDermott Dep. of 9/29/94, at 30, 77. Union officials Kevin and Ron McDermott each admitted during their depositions that the express contract terms did not include this change. Id. Thus, it is inconsistent for plaintiffs to assert that the alleged modification regarding the Route 81 project is impermissible when the union itself endorsed a different oral modification regarding the scope of the contract. A term limiting the contract's scope to the Route 81 project is not inconsistent with Article 1 of the contract, which merely states that work by union members is within the "jurisdiction" of the agreement. As discussed above, Iron Workers Fund and Butler sharply dispute both the content and the effect of discussions between Austin and union officials when Austin signed the 1986 Agreement. These disputes raise issues of fact precluding summary judgment.[4]
Iron Workers Fund next argues that oral contract modifications bind the union but not the fringe benefit fund. Plaintiffs state that if Butler ultimately proves that the 1986 Agreement was limited to the Route 81 project, then its appropriate remedy is to seek reimbursement. Pursuant to Section 1145 of ERISA, every employer that is obligated to make fringe benefit contributions must do so in accordance with the terms of relevant collective bargaining agreements and trust agreements.[5] 29 U.S.C. § 1145. Section 1145 limits the defenses available to an employer against a fringe benefit fund, so that ordinary contract defenses like fraudulent inducement and abandonment will not defeat a fund's rights under the agreement. Benson v. Brower's Moving & Storage, Inc., 907 F.2d 310, 314 (2d Cir.), cert. denied, 498 *595 U.S. 982, 111 S. Ct. 511, 112 L. Ed. 2d 524 (1990). Because of Section 1145, "once an employer knowingly signs an agreement that requires him to contribute to an employee benefit plan, he may not escape his obligation by raising defenses that call into question the union's ability to enforce the contract as a whole." Id. See also Southwest Adm'r, Inc. v. Rozay's Transfer, 791 F.2d 769, 775 (9th Cir.1986) (en banc), cert. denied, 479 U.S. 1065, 107 S. Ct. 951, 93 L. Ed. 2d 999 (1987).
However, Section 1145 does not limit Butler's defense to this lawsuit because defendant's argument concerns the 1986 Agreement's terms rather than any defects in its formation or execution. Thus, if the oral modification regarding the Route 81 project was effective, then the fund is "not entitled to enforce a nonexistent contractual obligation" regarding other projects. DeVito v. Hempstead China Shop, Inc., 38 F.3d 651, 654 (2d Cir.1994) (quotation and citation omitted). See also Sheet Metal Workers' Int'l Ass'n, Local 206 v. West Coast Sheet Metal Co., 954 F.2d 1506, 1509-10 (9th Cir.1992) (holding that employer not obligated to contribute to fringe benefit fund after union was decertified because collective bargaining agreement became inoperative and had no force or legal effect).
In Benson, the Second Circuit rejected an employer's defense that the union had abandoned the collective bargaining agreement because the fringe benefit fund could rely on the written contract terms. Benson, 907 F.2d at 316. However, the Second Circuit subsequently drew a distinction between defenses that call into question the union's ability to enforce the contract as a whole and a claim that the contract by its terms does not require the employer to make contributions. DeVito, 38 F.3d at 653-54. An employer can make the latter claim even against a fringe benefit fund. Id. at 654; see also Teamsters Indus. Employees Welfare Fund v. Rolls-Royce Motor Cars, Inc., 989 F.2d 132, 138 (3d Cir.1993).
I decline to follow the distinguishable cases Iron Workers Fund cites in support of its argument that any alleged oral modifications to the 1986 Agreement are ineffective. In a Seventh Circuit case, the court declined to enforce an oral promise that directly contradicted the written terms of a collective bargaining agreement. Central States, Southeast and Southwest Areas Pension Fund v. Gerber Truck Serv., Inc., 870 F.2d 1148, 1155-56 (7th Cir.1989) (en banc). In a Ninth Circuit case, the court stated that it was bound by circuit precedent to disregard a credible oral agreement between the parties and to "support[] unions when they impose hidden, burdensome obligations on small employers who have little or no bargaining power." Operating Eng'r Pension Trust v. Giorgi, 788 F.2d 620, 622-23 (9th Cir.1986). Second Circuit precedent does not compel a similar result. It is a question of fact whether Butler and the union agreed to the oral modification, which does not contradict express terms of the 1986 Agreement.
Thus, although Butler clearly signed the 1986 Agreement incorporating the terms of trust agreements, it is an issue of fact whether the parties orally modified the contract's terms to limit its application to the Route 81 project. Because the parties made an undisputed oral modification of the contract to limit its scope to commercial projects, an additional oral modification is plausible in light of the conflicting evidence. Contrary to plaintiffs' contention, Butler's argument on this issue is not a fraudulent inducement defense, which I agree would be ineffective against Iron Workers Fund. Rather, defendant's argument is a permissible defense concerning the terms of the agreement itself.
B. Automatic Renewal
Butler also contends that the automatic renewal provision in the 1986 Agreement is invalid and ineffective. Because the oral modification regarding the contract's scope is a disputed issue of fact, it also is an issue of fact whether the automatic renewal provision could apply in this case. I therefore need not address the parties' arguments regarding the legal effect of the automatic renewal provision.
C. Conclusion
I find as a matter of law that the 1986 Agreement was not fully integrated. An issue of fact exists regarding whether the parties intended to orally modify the contract to *596 apply only to the Route 81 project. Thus, I cannot determine as a matter of law the scope of the 1986 Agreement, including its termination date. I therefore deny plaintiffs' motion for summary judgment regarding Butler's obligation to make additional fringe benefit fund contributions and plaintiffs' right to conduct additional audits of Butler's records.
III. Counterclaim for fraudulent inducement
In the event that Butler is liable to Iron Workers Fund for delinquent fringe benefit contributions, defendant seeks indemnity from the union for fraudulently inducing Butler to sign the 1986 Agreement. Plaintiffs contend that Butler's counterclaim against the union must be dismissed as a matter of law because ERISA preempts it and because Butler failed to state a prima facie case. Neither argument has merit.
ERISA preemption is irrelevant to Butler's counterclaim against the union, which is governed by the LMRA. 29 U.S.C. § 185(a). Plaintiffs incorrectly state that Butler's counterclaim is governed by federal common law under ERISA, citing In re Masters Mates & Pilots Pension Plan and IRAP Litigation, 957 F.2d 1020 (2d Cir.1992). In that case, the court considered a settlement affecting in part the indemnity rights of an ERISA plan trustee. Id. at 1029, 1032. However, Butler's counterclaim for indemnity is against the union, not Iron Workers Fund. Ans. ¶ 39. Thus, the counterclaim does not implicate ERISA even though the amount of money for which Butler seeks indemnity is the equivalent of its delinquent ERISA contributions. See Rozay's Transfer v. Local Freight Drivers, Local 208, 850 F.2d 1321, 1325-26 (9th Cir.1988), cert. denied, 490 U.S. 1030, 109 S. Ct. 1768, 104 L. Ed. 2d 203 (1989) (allowing fraudulent inducement claim by employer against union for amount of delinquent ERISA contributions).
In addition, I find that Butler stated a prima facie case of fraudulent inducement. Butler ultimately must prove that the union knowingly made a material false representation concerning an existing fact with an intent to defraud the employer and that Butler reasonably relied on the misrepresentation to its detriment. See Cement and Concrete Workers Dist. Council v. Lollo, 35 F.3d 29, 33 (2d Cir.1994); see also Rozay's Transfer, 850 F.2d at 1326. Butler claims to have signed the 1986 Agreement in reliance on the union's fraudulent misrepresentation that the contract covered only the Route 81 project. Ans. ¶ 38. Recovery is not barred even if Butler was negligent in relying upon the union's misrepresentations. Diduck v. Kaszycki & Sons Contractors, Inc., 974 F.2d 270, 278 (2d Cir.1992).
It is a question of fact whether the union made the alleged fraudulent misrepresentations to Butler. Both parties submitted conflicting evidence regarding the conversations that took place between union officials and Butler President Austin at the time Austin signed the 1986 Agreement. This evidence concerns not only the fact of the alleged misrepresentation but also the knowledge and intent of the union officials. Plaintiffs argue that the alleged misrepresentation concerns a legal consequence of the contract's terms rather than a material fact. I disagree. As discussed in Section II of this opinion, it is a question of fact whether the union made oral modifications to the terms of the contract itself.[6]Cf. Rozay's Transfer, 850 F.2d at 1328 (holding that fraudulent inducement claim existed where union's oral misrepresentation was contrary to contract's express terms). Plaintiffs also contend that Butler did not rely on the misrepresentation to its detriment because it received the benefit of union workers. However, unforeseen liability for benefit fund contributions constitutes recoverable damages. Id. I reject the remainder of plaintiffs' arguments because they invite me to draw factual inferences adverse to the nonmovant defendant. Consequently, plaintiffs' motion to dismiss Butler's counterclaim is denied.
*597 IV. Discovery motion
In their April 13, 1993, request for production of documents, plaintiffs sought, among other things, all of Butler's payroll records, ledgers, W-2 forms, and individuals' earnings records from 1986 to the present. Clark Aff. of 12/13/94, Ex. G, at 4-6. Iron Workers Fund claims that these documents are relevant to determining whether Butler owes additional delinquent contributions, and if so, how much. Butler contends that the requested materials are irrelevant because they cover a period during which no collective bargaining agreement was in effect and that Iron Workers Fund already has conducted audits for periods during which Butler may have had any obligation to contribute to the fringe benefit fund. In the alternative, Butler seeks certain limitations on the scope of the plaintiffs' discovery request.
The parties brought their discovery dispute to the district court without first receiving a ruling from the magistrate judge. The record shows that the parties discussed their dispute with the magistrate on several occasions. On March 14, 1994, the parties conducted a telephone conference with Magistrate Judge Di Bianco in which he declined to rule on the discovery issue. According to the conference notes, the "[p]arties [were] to schedule another telephone conference if they believe[d] case should go forward without resolution of the `threshold issue.'" Dkt. No. 20. This threshold issue is the scope of the 1986 Agreement. On September 22, 1994, Magistrate Judge Di Bianco filed an order extending the time for conducting discovery and filing motions. Dkt. No. 24. However, he never ruled on the discovery dispute. Rather than make the initial determination on this issue, I deny plaintiffs' motion without prejudice to renewal before the magistrate judge. My ruling that the 1986 Agreement's scope is an issue of fact will have some bearing on the magistrate judge's decision.
CONCLUSION
For the foregoing reasons, plaintiffs' summary judgment motion is denied. In addition, I deny plaintiffs' motion to dismiss Butler's counterclaim against the union. Finally, I deny without prejudice to renewal before the magistrate plaintiffs' motion to compel discovery.
IT IS SO ORDERED.
NOTES
[1] Iron Workers Fund claims that Butler permitted this audit to settle a grievance the union filed in June 1990 against Butler. Pl. Rule 7.1(f) Statement, Ex. O. Defendant contends that the audit was not part of a settlement and that the union abandoned its grievance.
[2] Plaintiffs originally filed their complaint in U.S. District Court for the Western District of New York, and the parties agreed to transfer the action to the Northern District of New York.
[3] The parties also signed a short-form contract that automatically incorporated into the 1986 Agreement any changes in fringe benefits negotiated by the union and Construction Association. Id.
[4] Because my decision is based on the terms of the contract itself, I do not address the parties' arguments regarding their course of conduct, although the parties' conduct can be circumstantial proof of an agreement to modify a contract. See Marine Transport, 878 F.2d at 45. I note only that the evidence regarding the parties' conduct such as the scope of audits of Butler's business records, the union's provision of workers for projects other than the Route 81 project, and Butler President Austin's stated belief that the 1983 Agreement covered only the Route 81 project also raises issues of fact regarding the scope of the 1986 Agreement.
[5] Section 1145 provides:
Every employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance with the terms and conditions of such plan or such agreement.
29 U.S.C. § 1145.
[6] The existence of an undisputed oral contract modification limiting the 1986 Agreement to commercial projects further supports my conclusion that the existence of the disputed Route 81 project limitation is an issue of fact. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581353/ | 957 F. Supp. 628 (1997)
In re UNISYS CORPORATION RETIREE MEDICAL BENEFITS ERISA LITIGATION.
This Document Relates To: All Actions.
MDL No. 969.
United States District Court, E.D. Pennsylvania.
March 10, 1997.
*629 *630 *631 MEMORANDUM
CAHN, Chief Judge.
Plaintiff retirees brought this class action against their former employer, Unisys Corporation,[1] pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA"). Before the court are a motion for summary judgment by the Sperry retirees and two motions for partial summary judgment by Unisys. For the reasons stated below, Plaintiffs' motion is denied, and Defendant's motions are granted in part and deferred in part.
I. FACTS AND PROCEDURAL HISTORY[2]
This class action, filed on behalf of former employees of the Sperry, Burroughs, and Unisys Corporations, arises out of Unisys' termination of its post-retirement medical plans for retirees and disabled former employees of the three companies.
On November 3, 1992, Unisys announced that effective January 1, 1993, it was terminating all pre-existing medical benefit plans ("old plans") and replacing the old plans with a new one, called the Unisys Post-Retirement and Extended Medical Disability Plan ("new plan"). Under the majority of the old plans, Unisys had paid the entire medical premium for a retiree's life and provided continuing benefits for the retiree's spouse. In contrast, the new plan would require retirees to contribute an increasing portion of the premiums until January 1, 1995, at which time the retirees would become responsible for the entire premium. Plaintiffs, who will be referred to throughout this opinion as the retirees, brought suit in several jurisdictions to challenge the termination of benefits. The Judicial Panel on Multidistrict Litigation transferred the cases to the Eastern District of Pennsylvania. This court certified the class and identified several subclasses.[3]
The claims raised by the retirees sought relief based on three causes of action: breach of contract, equitable estoppel, and breach of fiduciary duty. On the breach of contract claims, which sought reinstatement of the old plans based on the theory that the benefits had vested and that the company had an obligation to continue the plans, the court granted Unisys' summary judgment motion as to the Burroughs and Unisys retirees, but denied the motion on the Sperry retirees' claims. In re Unisys, 837 F.Supp. at 675-79. Following a non-jury trial, this court entered judgment for Unisys on the Sperry retirees' contract claims. In re Unisys Corp. Retiree Medical Benefits ERISA Litig., MDL No. *632 969, 1994 WL 284079, at *18-25 (E.D.Pa. June 23, 1994), aff'd, 58 F.3d 896, 901-06 (3d Cir.1995). On the equitable estoppel claims, this court granted Unisys' motion for summary judgment against all classes, 837 F.Supp. at 680-81, and this court's refusal to reinstate these claims was affirmed. 58 F.3d at 907-08.
On the breach of fiduciary duty claims, the court originally granted Unisys' motion for summary judgment. However, after trial of the Sperry retirees' contract claims, the court granted the Sperry retirees' motion to reinstate their fiduciary duty claims. In re Unisys, 1994 WL 284079, at *25-27. The Burroughs and Unisys retirees then moved to reinstate their breach of fiduciary duty claims. The court stayed all further proceedings on all three classes' breach of fiduciary duty claims pending the resolution of an interlocutory appeal of the Sperry reinstatement decision. The Third Circuit Court of Appeals affirmed the decision to reinstate the Sperry retirees' fiduciary claims, and the petition for writ of certiorari to the United States Supreme Court was denied. In re Unisys Corp. Retiree Medical Benefits "ERISA" Litig., 57 F.3d 1255 (3d Cir.1995), cert. denied, ___ U.S. ___, 116 S. Ct. 1316, 134 L. Ed. 2d 469, 470 (1996). This court then considered supplemental memoranda filed by the parties, and granted the Burroughs and Unisys retirees' motions for reinstatement of their breach of fiduciary duty claims. In re Unisys Corp. Retiree Medical Benefits ERISA Litig., MDL 969, 1996 WL 455968 (E.D.Pa. Aug. 13, 1996).
In reinstating the Burroughs and Unisys retirees' breach of fiduciary duty claims, the court invited Unisys to file dispositive motions based on the statute of limitations and the relief available for any successful plaintiffs. Id. at *6. Unisys has done so in the form of the two motions for partial summary judgment now before the court. Also before the court is a motion by the Sperry retirees for summary judgment on their breach of fiduciary duty claims. This opinion addresses all three motions.
II. STANDARD FOR SUMMARY JUDGMENT
Summary judgment is appropriate when the record shows that "there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The court's role is to determine whether the evidence is such that a reasonable jury could return a verdict for the non-moving party, with all reasonable inferences viewed in the light most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 255, 106 S. Ct. 2505, 2510-11, 2513-14, 91 L. Ed. 2d 202 (1986). The moving party has the burden of demonstrating that no genuine issue of material fact exists, but if the non-moving party fails to produce sufficient evidence in connection with an essential element of a claim for which it has the burden of proof, then the moving party is entitled to summary judgment. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S. Ct. 2548, 2552-53, 91 L. Ed. 2d 265 (1986).
III. THE BREACH OF FIDUCIARY DUTY CLAIMS
The breach of fiduciary duty claims allege a violation of ERISA § 404(a):
[A] fiduciary shall discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries and for the exclusive purpose of: (i) providing benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of administering the plan.
29 U.S.C. § 1104(a)(1)(A). ERISA § 502(a)(3)(B) provides the retirees with a cause of action:
A civil action may be brought by a participant, beneficiary, or fiduciary to obtain other equitable relief (i) to redress such violations or (ii) to enforce any provisions of this subchapter or the terms of the plan.
29 U.S.C. § 1132(a)(3)(B).[4]
In this action, the Third Circuit Court of Appeals has detailed the four elements the *633 retirees must demonstrate in order to succeed on their breach of fiduciary duty claim: proof of fiduciary status, misrepresentations by the company, company knowledge of the confusion created, and resulting harm to the employees. In re Unisys, 57 F.3d at 1265. These elements will be discussed in more detail in section VII of this opinion.[5]
In addressing the arguments made regarding the retirees' breach of fiduciary duty claims, it is important to note that this court has already ruled that Unisys had a contractual right, under ERISA, both to use the reservation of rights language in the summary plan description ("SPD") and to terminate the old plans. The breach of fiduciary duty claims survive because Unisys had fiduciary responsibilities independent of its contractual responsibilities under the plan. In re Unisys, 57 F.3d at 1265. In affirming this court's reinstatement of the breach of fiduciary duty claims, the Court of Appeals for the Third Circuit explained:
[S]atisfaction by an employer as plan administrator of its statutory disclosure obligations under ERISA does not foreclose the possibility that the plan administrator may nonetheless breach its fiduciary duty owed plan participants to communicate candidly, if the plan administrator simultaneously or subsequently makes material misrepresentations to those whom the duty of loyalty and prudence are owed.
Id. at 1264.[6] The breach of fiduciary duty claims are based not on the termination of the old plans, since the court has already held that the termination of the plans was not a breach of the company's fiduciary duty. In re Unisys, 837 F.Supp. at 679. Rather, they rely on the misrepresentations about the lifetime benefits in the old plans. The court reinstated the claims because the retirees presented significant evidence that Unisys made repeated and pervasive representations that the medical benefits were "for life," without ever mentioning the reservation of rights clause, which allowed Unisys to terminate the plans at any time. The court will elaborate on the substance of the fiduciary claims as necessary throughout this opinion; however, the court will first address Unisys' motion for partial summary judgment based on the applicable statute of limitations.
IV. STATUTE OF LIMITATIONS
ERISA contains an express statute of limitations for breach of fiduciary duty claims. Section 413 of ERISA provides:
No action may be commenced under this subchapter with respect to a fiduciary's breach of any responsibility, duty, or obligation ... after the earlier of
(1) six years after (A) the date of the last action which constituted a part of the breach or violation, or (B) in the case of an omission, the latest date on which the fiduciary could have cured the breach or violation, or
(2) three years after the earliest date on which the plaintiff had actual knowledge of the breach or violation;
except that in the case of fraud or concealment, such action may be commenced not later than six years after the date of discovery of such breach or violation.
29 U.S.C. § 1113. This section creates a general limitations period of six years from *634 the breach of duty, shortened to three years in cases where the plaintiffs have actual knowledge, and extended to six years from the date of discovery in cases where the fiduciary used fraud or concealment. Kurz v. Philadelphia Elec. Co., 96 F.3d 1544, 1551 (3d Cir.1996). Unisys seeks to have this court grant summary judgment against all the Sperry retirees who retired before November 17, 1986 (six years before the first complaint by the Sperry retirees was filed), and against all the Burroughs retirees who retired before December 3, 1986 (six years before the first complaint by the Burroughs retirees was filed).
The court must resolve several issues regarding the application of the statute of limitations. The first is whether Unisys used fraud or concealment to hide its breach of fiduciary duty from the plaintiffs. If the court finds that there is a genuine factual dispute regarding whether Unisys used fraud or concealment to conceal a breach of fiduciary duty, Unisys' summary judgment motion must be denied, because the retirees filed suit within six years of the actual discovery of the breach.[7] If the court does not find fraud or concealment, I must next determine whether the case involves an action or an omission as defined in the statute. The third question is the date of the last action constituting a part of the breach or violation, or the latest date on which Unisys could have cured the breach or violation. Finally, the court must determine whether the statute of limitations should be equitably tolled given the circumstances of this case.
A. Did Unisys use fraud and concealment?
The retirees contend that the proper statute of limitations for the court to apply is the final clause of § 1113, which states that a showing of fraud and concealment tolls the statute of limitations, giving the plaintiffs six years from the date of discovery of the breach in which to sue. This court finds no genuine factual dispute about the allegations of fraud, and holds that the "fraud or concealment" tolling provision does not apply in this case. The court has already held that there are "no substantiated allegations of fraud or bad faith on Unisys' part." In re Unisys, 837 F.Supp. at 680-81 (footnote omitted), and finds no reason to disturb that holding here.[8]
The Third Circuit Court of Appeals recently interpreted the "fraud or concealment" provision of § 1113, and held that the federal common law discovery rule now applies to ERISA breach of fiduciary duty claims. Kurz, 96 F.3d at 1552. "In other words, when a lawsuit has been delayed because the defendant itself has taken steps to hide its breach of fiduciary duty, the limitations period will run six years after the date of the claim's discovery." Id. (internal citation omitted). The Kurz opinion emphasized that "[t]he relevant question is ... not whether the complaint `sounds in concealment,' but rather whether there is evidence that the defendant took affirmative steps to hide its breach of fiduciary duty." Id. (emphasis added).
There are two types of fraudulent "affirmative steps" that can toll § 1113. "Active concealment" refers to acts distinct from the original fraud that are intended to conceal the original fraud. Wolin v. Smith Barney, Inc., 83 F.3d 847, 852 (7th Cir.1996). "Self-concealing" fraud refers to acts committed during the course of the original fraud that have the effect of concealing the fraud from its victims. Id. There has been no evidence that active concealment was involved in this case. The allegations of concealment for the *635 purposes of tolling the statute of limitations are not independent of or distinct from the original misrepresentations that are the basis of the breach of fiduciary duty claim. Indeed, the gravamen of both the breach claim and the claim of fraud is that Unisys "concealed the true nature of the plans by knowingly and systematically misrepresenting the duration of [the lifetime] benefits." Mem. of Sperry Pltfs. in Opposition to Def.'s Mot. for Partial Summ.Judg., 13. Therefore, this court will address the claims of fraud and concealment only as allegations of self-concealing wrongs.
It should be noted that not all courts have accepted that self-concealing wrongs, as opposed to active and distinct concealment, can toll the statute of limitations under the fraud or concealment exception.[9] However, this court need not decide the question at this time, because even if the exception applies in cases of self-concealing wrongs, Unisys' actions do not reach the level of fraud or fraudulent concealment.
Regardless of whether the fraud alleged by a plaintiff involves active and independent concealment or a self-concealing breach of fiduciary duty, in order to find fraud or concealment under § 1113, "there must be actual concealment i.e., some trick or contrivance intended to exclude suspicion and prevent inquiry." Larson v. Northrop Corp., 21 F.3d 1164, 1173 (D.C.Cir.1994) (internal citations omitted). In this case, there has been no such trick or contrivance. The reservation of rights clause, published in the summary plan description ("SPD") which all participants received, explained the nature of the lifetime benefits. While this court and the court of appeals have concluded that compliance with SPD disclosure obligations does not relieve a company of its fiduciary duty to avoid confusing participants about their benefits, this court will not hold that the truth about the "lifetime" benefits was concealed from participants when the information about the reservation of rights clause was unambiguously printed and distributed in the SPD.
The retirees ask the court to deny partial summary judgment, urging that there is at least a factual dispute regarding the allegations of fraud. To demonstrate the existence of such a dispute, the retirees have the burden of supplying this court with "sufficient evidence, not mere allegations" supporting their position, so that retirees could reasonably win on their position at trial. Coolspring Stone Supply, Inc. v. American States Life Ins. Co., 10 F.3d 144, 148 (3d Cir.1993). In support of their allegations of a "trick or contrivance intended to exclude suspicion and prevent inquiry," plaintiffs have pointed to a letter from the mid-1980s from a consulting company which discusses the liabilities created by the old plans and the "implied promise" made regarding the benefits, and a set of correspondence between H.P. Seward and W.H. Beadle in 1970. Appendix to Unisys Motion, Exh. 8-9. These letters and other evidence of a similar vein (see Sperry Pltfs' Statement of Undisputed Facts, attached to Sperry Pltfs' Mot. for Summ. Judg., ¶¶ 66-82) may help the retirees establish a breach of fiduciary duty by showing that Unisys was aware of the materiality of the "lifetime" promise to the employees in making their retirement decisions. However, they reveal no trick, contrivance, or intent to deceive the plaintiffs about the existence of the published reservation of rights clause.
Other courts have refused to apply the fraud or concealment exception to § 1113 when the information a plan participant alleges has been concealed is actually readily *636 available to that person, and this court agrees with that conclusion. See J. Geils Band Employee Benefit Plan v. Smith Barney Shearson, Inc., 76 F.3d 1245, 1255-60 (1st Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 81, 136 L. Ed. 2d 39 (1996) (no fraud or concealment under § 1113 where alleged oral misrepresentations giving rise to breach of fiduciary duty claim were belied by information in written documents available to plaintiffs); Wolin, 83 F.3d at 854 (oral representations contradicting clear written statements cannot constitute fraudulent concealment under § 1113). It would be odd indeed to characterize the facts of this case as constituting fraud or concealment when the reservation of rights clause was included in the SPD, the very instrument designed by Congress for communicating the essential terms of a plan to participants. See Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73, ___, 115 S. Ct. 1223, 1230, 131 L. Ed. 2d 94 (1995) (ERISA has an "elaborate scheme ... built around reliance on the face of written plan documents" to enable beneficiaries to learn their rights).
The reluctance of this and other courts to apply the fraud or concealment exception in cases where the SPD or other available documentation unambiguously reveals the true situation is consistent with the federal common law discovery rule. The discovery rule, as applied to this portion of § 1113, includes a requirement of "reasonable diligence" on the part of the plaintiffs. As the Court of Appeals for the Third Circuit has explained, "[t]he statute of limitations is tolled until the plaintiff in the exercise of reasonable diligence discovered or should have discovered the alleged fraud or concealment." Kurz, 96 F.3d at 1552 (emphasis added) (citations omitted); see also Larson, 21 F.3d at 1172 (application of fraud exception to § 1113 requires plaintiffs show that they "were not on actual or constructive notice of [the evidence of breach], despite ... their exercise of reasonable diligence.") (citations omitted). In this case, reasonable diligence on the part of the plaintiffs would have led to a discovery of the reservation of rights clause. While there was a breach of duty by Unisys in its misrepresentations about the lifetime guarantee, there is no genuine issue of material fact as to whether the misrepresentations reach the level of a trick or contrivance designed to prevent plan participants from learning the truth.
Unisys' 1992 decision to replace all pre-existing plans with the Unisys Post-Retirement and Extended Disability Plan ("the new plan") was the product of a number of factors. It was prompted in part by the issuance of Financial Accounting Standards Board Statement No. 106 ("FAS 106"), which would have created large liabilities on Unisys' financial statements. In re Unisys, 1994 WL 284079, at *3.[10] Unisys also terminated the old plans because of escalating medical costs and administrative costs of maintaining many different plans. There is no evidence that Unisys terminated the prior plans in furtherance of an intent to defraud the plaintiffs. The court of appeals has "accept[ed] Unisys' contention that at the time lifetime benefits were promised, no one at Sperry ever intended or anticipated that there would one day be the need to reduce or eliminate retiree medical benefits." In re Unisys, 57 F.3d at 1265 n. 15. While the retirees have shown misrepresentations by the company, they have not substantiated their allegations of fraud.[11] Therefore, this court will not *637 apply the "fraud or concealment" tolling provision of the statute of limitations, and will look to § 1113(1) to decide the statute of limitations issue.
B. Is the alleged breach an act or an omission?
Having concluded that subsection (1) of § 1113 applies to this case, the court must determine whether to apply § 1113(1)(A), which measures six years from the date of an act allegedly constituting a breach of fiduciary duty, or § 1113(1)(B), which measures six years from the last date on which the omission allegedly constituting a breach of fiduciary duty could have been cured. Because the court finds that the claims in this case are based on affirmative acts, the former measure is appropriate.
Unisys argues that this case is properly considered one of an omission because the breach of fiduciary claims were reinstated based on the Third Circuit's holding in Bixler. In Bixler, the court of appeals held that ERISA fiduciaries have an "affirmative duty to inform" when the fiduciary knows its silence might be harmful. 12 F.3d at 1300. Unisys argues that because the failure to allay the employees' confusion supports the fiduciary duty claim, the case is rightfully considered one of omission.
The court disagrees, and holds that this case is more accurately described as a case of affirmative acts rather than omissions. The breach of fiduciary duty claims by the retirees were reinstated based upon "a strong current in the Third Circuit that recognizes that an ERISA fiduciary may not `affirmatively mislead' plan participants." In re Unisys, 1994 WL 284079 at *25 (citations omitted) (Sperry regular retirees); see also In re Unisys, 1996 WL 455968 at *6 (Burroughs and Unisys regular retirees). When the Third Circuit Court of Appeals affirmed the reinstatement of the breach of fiduciary duty claims, it specifically rejected Unisys's description of the case as involving a "duty to remind," finding instead that the dispute was "more accurately characterized as a dispute over an employer's duty, as an ERISA fiduciary, not to misinform employees through material misrepresentations and incomplete, inconsistent or contradictory disclosures." In re Unisys, 57 F.3d at 1264.
This court found widespread affirmative misrepresentations in the case of the Sperry retirees:
This is not a case where one or two low-level benefits counselors told a few retirees that their benefits would continue for life. The message that medical benefits would last for life was confirmed repeatedly and systematically throughout the Sperry organization, by all levels of management, in writing and verbally.
In re Unisys, 1994 WL 284079, at *25. In the case of the Burroughs and Unisys retirees, the court reinstated the fiduciary duty claims because Plaintiffs produced evidence that Unisys made affirmative and material misrepresentations to them as well. In re Unisys, 1996 WL 455968, at *6. This court's opinions focus primarily on affirmative acts of misrepresentation, and the court of appeals has included "misrepresentations" as a necessary element of each retiree's case. In re Unisys, 57 F.3d at 1265. The misrepresentations made in this case are more than omissions; they constitute affirmative conduct.
In truth, the breach alleged in this case involves both omissions and acts. Significant for this court's reinstatement of the fiduciary claims were both: "(1) the evidence of corporate management's awareness of confusion or *638 at least the potential for confusion regarding the permanency of health benefits after retirement; and (2) corporate management's exacerbation of this confusion through informal communications which failed to clarify the limits of the coverage." In re Unisys, 1996 WL 455968, at *2. The first phrase implies an omission, the second an affirmative act. The court of appeals highlighted the dual nature of the breach alleged:
Our decisions in Bixler, Fischer [v. Philadelphia Elec. Co., 994 F.2d 130 (3d Cir. 1993)] Curcio [v. John Hancock Mut. Life Ins. Co., 33 F.3d 226 (3d Cir.1994)] and Smith [v. Hartford Ins. Group, 6 F.3d 131 (3d Cir.1993)] firmly establish that when a plan administrator affirmatively misrepresents the terms of a plan or fails to provide information when it knows that its failure to do so might cause harm, the plan administrator has breached its fiduciary duty to individual plan participants and beneficiaries.
In re Unisys, 57 F.3d at 1264 (emphasis added). However, the court finds that the emphasis of the discussion has been on Unisys' wrongful actions rather than its omissions. This court and the court of appeals have allowed this breach of fiduciary duty action to proceed largely because Unisys "actively and affirmatively, systematically misinformed its employees." Id. at 1266. Therefore, the court will apply the statute of limitations in § 1113(1)(A) and look to the date of the last act constituting part of the breach.
C. What is the date of the last act constituting part of the breach?
Plaintiffs contend that the date of the last action constituting part of the alleged breach occurred in 1992, when Unisys acted contrary to its misrepresentations and terminated the old benefit plans. According to Plaintiffs, the resulting harm in this case did not take place until the old plans were terminated, so the cause of action did not accrue until then. In response to Unisys' argument that the last date constituting part of the breach was the date each plaintiff retired, the retirees point out that the date of the last "action constituting part of the breach or violation" refers to an action taken by the party committing the breach, not to actions taken by the victims of the breach.
The court disagrees with the retirees, and holds that the last action constituting part of the breach of fiduciary duty took place on the date that each plaintiff retired. This decision does not imply that the act of retirement is part of the breach. Rather, I am holding that Unisys' last action constituting part of the breach of fiduciary duty owed to any individual employee was complete on the date that employee chose to retire. The last misrepresentation about "for life" benefits which could have affected an employee's decision to retire must have occurred on or before the date that employee retired.[12]
The retirees contend that even if the breaching action by the Company was complete on the date of each employee's retirement, the statute of limitations does not begin to run until all the elements of a cause of action for the breach of fiduciary duty claim, including resulting harm, are present. Retirees claim that the resulting harm did not occur until the termination of the plan.
The retirees are wrong for two reasons. First, they misunderstand what the resulting harm is in this case. Second, the case law on this section of the ERISA statute convinces the court that the plaintiff need not feel injury from the breach in order for the six-year statute to begin running.
The resulting harm in this case is not the termination of the old plans and the loss of benefits in 1992. The decision to terminate the old plans was not fiduciary conduct, and cannot be part of the breach of fiduciary duty. See Curtiss-Wright, 514 U.S. at ___, 115 S.Ct. at 1228 (employers and other plan sponsors do not act in a fiduciary *639 capacity when they amend or terminate a welfare benefits plan). Instead, the breach of fiduciary duty claim arises from misrepresentations about lifetime benefits, misrepresentations which may have caused plaintiffs to retire earlier than they would have if they had understood that their benefits might not be for life. Moreover, the loss of benefits to the retirees cannot be the "resulting harm" of the breach of fiduciary duty because the misrepresentations neither caused nor resulted in the loss of the benefits. The benefits were lost because of a non-fiduciary decision by Unisys to terminate the plans. The plan would have been terminated regardless of whether the misrepresentations had occurred; the breach of fiduciary duty involved was not the "but-for" cause or even a substantial factor in the decision to terminate the old plans. Cf. Hein v. Federal Deposit Insurance Corp., 88 F.3d 210, 224 (3d Cir. 1996), cert. denied sub nom. Hein v. McNeil, ___ U.S. ___, 117 S. Ct. 683, 136 L. Ed. 2d 608 (1997) ("causal link" between alleged breach of fiduciary duty and denial of benefits is required to support claim for the benefits). In this case, the resulting harm of the breach is that many employees may have chosen to work for an additional amount of time if they had known that their "lifetime" benefits were actually revocable.
Second, even if the resulting harm in this case were not felt until the 1992 change in benefit plans, this court would still find that the limitations period began on the date each plaintiff retired. Section 1113(1)(A)'s statute of limitations begins to run before the victim of a breach of fiduciary duty incurs any financial injury. In Ziegler v. Connecticut General Life Ins. Co., 916 F.2d 548, 551-52 (9th Cir.1990), the Ninth Circuit Court of Appeals specifically held that actual financial harm need not occur for a breach of fiduciary duty cause of action to accrue. In Ziegler, the defendant executed an investment agreement containing provisions which allegedly violated its fiduciary duties. The court rejected plaintiffs' assertion that the harm from the breach was merely theoretical until a later distribution was made, an assertion similar to the one made by the retirees in this case. Pointing out that "Congress intended to make fiduciaries culpable for certain ERISA violations even in the absence of actual injury to a plan or participant," the court held that the cause of action accrued when the challenged contract was executed, not when its consequences were felt by the plaintiffs. Id. at 551. The Court of Appeals for the District of Columbia Circuit has reached the same conclusion, ruling that § 1113(1)(A)'s statute of limitations begins to run on the date when "there [is] no further action left to be taken by way of completing the alleged breach." Larson, 21 F.3d at 1171. The Larson court found the last action constituting part of the purported breach of fiduciary duty occurred when the defendant purchased an allegedly deficient annuity contract to substitute for a terminated benefits plan, not years later when the plaintiff was denied promised benefits. Id. at 1169, 1171.
In this circuit, precedent convinces me that the Third Circuit Court of Appeals would agree with the Ninth and District of Columbia Circuits. In Gluck v. Unisys Corp., 960 F.2d 1168 (3d Cir.1992) and International Union of Electronic, Electric, Salaried, Machine and Furniture Workers, AFL-CIO v. Murata Erie North America, Inc., 980 F.2d 889 (3d Cir.1992), the court of appeals was presented with plan sponsors who had amended their pension plans in manners allegedly violative of their fiduciary duties under ERISA. In both cases, after the plans were amended, the defendants took subsequent steps that caused a transfer of assets claimed by the plan participants. In both cases, the court held that § 1113(1)(A)'s statute of limitations began to run on the date that the plans were impermissibly amended, not the date when the assets were transferred away from the plan participants. Murata, 980 F.2d at 900; Gluck, 960 F.2d at 1178.
The Gluck and Murata opinions reveal that for purposes of the statute of limitations, the last action constituting part of the breach or violation occurs not on the date the harm is felt by the plan or its participants, but on the date the breach was complete. Plaintiffs need not suffer harm in the form of denied or reduced benefits in order for the cause of action to accrue. In this case, the *640 court has held that the termination of the plans in 1992 was not fiduciary conduct and was not a part of the alleged breach of fiduciary duty; the breach of duty consisted of misrepresentations about the permanency of the "lifetime" benefits. Therefore, the last date on which Unisys completed its alleged breach of fiduciary duty to an employee was the date it allowed that employee to retire thinking that the guarantee of lifetime benefits could not be changed.
D. Is the statute of limitations equitably tolled?
Finally, the retirees believe that even if their claims accrued on the date that each of them retired, the common-law doctrine of equitable tolling prevents their claims from being time-barred. "Equitable tolling functions to stop the statute of limitations from running where the claim's accrual date has already passed." Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1387 (3d Cir.1994) (citation omitted). The doctrine is based on the equitable principle that, having unfairly lulled a plaintiff into inaction, a defendant may not profit from such wrongful conduct by invoking the statute of limitations defense. LaVallee Northside Civic Ass'n v. Coastal Zone Management, 866 F.2d 616, 625 (3d Cir.1989). Plaintiffs urge that the policy interests behind equitable tolling are present in this case. For example, this is not a case of plaintiffs sitting on their rights; the retirees sued within weeks of learning about the change in benefit plans. Furthermore, failure to toll the statute of limitations means that the retirees were required to sue while Unisys' misrepresentations were ongoing and before the retirees felt injury. Plaintiffs' strong arguments notwithstanding, this court finds that equitable tolling is not available in this case.
While federal statutes of limitations are generally subject to equitable tolling, Congress is free to supplant the common-law doctrine by providing otherwise in the statute. Irwin v. Dept. of Veterans Affairs, 498 U.S. 89, 95-96, 111 S. Ct. 453, 457-58, 112 L. Ed. 2d 435 (1990). The retirees present valid policy arguments in favor of tolling the statute in this case. However, at least one court has found that Congress considered arguments such as those of the retirees, and provided for those concerns by enacting the "fraud and concealment" provision into the law. In Larson v. Northrop Corp. 21 F.3d 1164, 1171 (D.C.Cir.1994), the District of Columbia Circuit Court of Appeals was unable to find any relevant legislative history reflecting Congress' intent respecting § 1113. Endeavoring to determine Congressional intent, the court noted that the statute expressly includes a tolling-until-discovery rule in cases of fraud or concealment, "indicat[ing] that Congress had the discovery rule fully in mind but was deliberately omitting it from § 1113(1)(A)." Id. at 1172. The court held that § 1113 reflects a Congressional judgment that equitable tolling is not available to plaintiffs suing for an ERISA breach of fiduciary duty:
We recognize that isolated situations can be imagined where it could seem harsh to penalize a beneficiary for not suing within six years: for example, ... the beneficiary might not have discovered the breach within the six years. However, the special provision Congress made elsewhere in § 1113 for fraud or concealment ... provides amelioration in the worst cases while, at the same time, indicating that Congress meant to toll the statute only in instances of fraud or concealment.... That the limitations period in § 1113(1)(a) is six years ... suggests a judgment by Congress that when six years has passed after a breach or violation, and no fraud or concealment occurs, the value of repose will trump other interests, such as a plaintiff's right to seek a remedy.
Id. at 1171-72 (footnote omitted). Other courts have expressed doubt about equitable tolling's application to § 1113. See Wolin v. Smith Barney, Inc., 83 F.3d 847, 850 (7th Cir.1996) ("The explanation [for the explicit inclusion of a discovery rule only in cases or fraud or concealment] may be that Congress decided to substitute a fixed period of years for the open-ended judge-made doctrines of fraudulent concealment and equitable estoppel, *641 thus promoting (as in statutes of repose) certainty of legal obligation.")[13]
This court finds the reasoning of Larson persuasive, and agrees with the Court of Appeals for the D.C. Circuit that equitable tolling is not available under § 1113. As the Larson opinion explained, the Supreme Court has addressed the question of Congressional intent to supplant equitable tolling in a situation analogous to the ERISA context. Larson, 21 F.3d at 1174. In Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350, 360-62, 111 S. Ct. 2773, 2780-82, 115 L. Ed. 2d 321 (1991), a securities case, the Court first determined that § 9(e) and § 18(c) of the Securities and Exchange Act of 1934 were the applicable statutes of limitation for private suits brought pursuant to § 10(b) of that act and several of its regulations. Turning to the plaintiffs' contention that equitable tolling should apply to the statute, the Court examined what it called the "1-and-3-year structure" of the two limitations periods, which provide that suits must be brought within one year of the discovery of the facts constituting the violation and within three years of the violation itself. Id. at 361, 111 S.Ct. at 2781.[14] The Court held that equitable tolling would be inconsistent with the structure of the statute of limitations:
The 1-year period, by its terms, begins after discovery of the facts constituting the violation, making tolling unnecessary. The 3-year limit is a period of repose inconsistent with tolling.... Because the purpose of the 3-year limitation is clearly to serve as a cutoff, we hold that tolling principles do not apply to that period.
Id. at 363, 111 S.Ct. at 2782.
This court agrees with Larson that Lampf Pleva's reasoning prevents equitable tolling in ERISA breach of fiduciary duty cases. Section 1113 of ERISA has a 3-and-6-year structure similar to the 1-and-3-year structure of §§ 9(e) and 18(c) of the Securities and Exchange Act, and it seems sensible that the six-year limitation was meant as an outer limit. Furthermore, as Larson recognizes, § 1113 provides an additional protection to plaintiffs that §§ 9(e) and 18(c) of the securities law do not, an exception to the limitations period in cases of fraud or concealment. Larson, 21 F.3d at 1175. The explicit inclusion of that exception, combined with the structure of the statute, convinces this court that the statute should only be tolled in cases of fraud or concealment. The court has already found that Unisys cannot reasonably be found to have engaged in fraud and concealment; therefore the limitations period cannot be tolled.[15] The claims of those plaintiffs *642 who retired more than six years before the first action in this case was filed are time-barred.
V. RETIREES WHO CANNOT PROVE AN ESSENTIAL ELEMENT OF THEIR CLAIMS
In addition to its statute of limitations arguments, Unisys asks this court to grant summary judgment against all retirees who Unisys contends will not be able to prove all four elements of their claim. Specifically, Unisys asserts that plaintiffs who retired before "lifetime" medical benefits were offered in their divisions, those who retired when the company still enforced a mandatory retirement age of 65, and those who left their company's employ involuntarily because of disability, layoffs, or other reasons cannot prove an essential element of their claim.[16] These plaintiffs cannot prove that the breach of fiduciary duty led them to retire earlier than they otherwise would have. Therefore, Unisys argues, they cannot demonstrate the "resulting harm" required for a breach of fiduciary duty claim, and summary judgment should be entered against them.
Plaintiffs have responded to Unisys' argument by providing a host of affidavits from retirees who allegedly made important decisions based on the "lifetime" misrepresentations. For example, some members of the class declined other employment opportunities based on their reliance on the representations of lifetime benefits, others chose to forego the opportunity to purchase supplemental health insurance for themselves or their spouses, and others made financial decisions for their retirement based on the life-time representations. See, e.g. Declaration of James Moha, Sperry Pltf. Exh. O, ¶ 8, Append. to Sperry Pltf.Mem. in Opp. to Partial Summ.Judg. (did not participate in other health plans); Declaration of Philip Desilets, Sperry Pltf. Exh. F, ¶ 9, Append. to Sperry Pltf.Mem. in Opp. to Partial Summ.Judg. (created a post-retirement budget based on misrepresentations, and if not for misrepresentations would have secured other employment after laid off from Sperry). Many of the retirees are now too old to obtain supplemental insurance or to work. Plaintiffs argue that the retirees who made decisions beyond the one to retire based on Unisys' misrepresentations can show the resulting harm required to succeed on a breach of fiduciary duty claim. Plaintiffs also remind the court that Unisys was not free to mislead any plan participant, whether active employee or retiree.
The issue for this court, then, is whether the "harm" suffered by the retirees who made decisions other than the one to retire based on Unisys' misrepresentations is the type of "resulting harm" capable of supporting a breach of fiduciary duty claim in the context of this case. Thus far in this case, the "harm" considered actionable by this court and the court of appeals has been the *643 decision, made without full information, to retire:
Unisys had knowledge that its employees believed the assurances of lifetime benefits they had been given and were making retirement decisions based on their understanding [that the benefits would be stable for life].... Unisys' executives were aware that the lifetime medical benefit was an important consideration for employees who were considering when to retire. This evidence established that the company knew that employees accelerated their retirement plans because of the belief that by retiring at a certain point in time, they would "lock in" the lifetime coverage that they had under the current plan.... Unisys was aware of the fact that retirees were electing to retire based on this understanding....
In re Unisys. 57 F.3d at 1266 (emphasis added). The court of appeals used similar language in Fischer v. Philadelphia Electric Co., 994 F.2d 130 (3d Cir.), cert. denied, 510 U.S. 1020, 114 S. Ct. 622, 126 L. Ed. 2d 586 (1993), in which it held that a plan administrator breaches its fiduciary duty under ERISA if it makes material misrepresentations to plan participants about proposed changes to benefit plans. The court stated that a misrepresentation would be considered "material" only if there was a "substantial likelihood that it would mislead a reasonable employee in making an adequately informed decision about if and when to retire." Id. at 135 (emphasis added).
More than the court's choice of phrase guides this decision. To allow retirees who did not retire based on the lifetime language to maintain a breach of fiduciary duty in this case would subvert the holdings of this court and the court of appeals in this case. Adoption of the retirees' position would resurrect the claim for equitable estoppel, which this court has previously rejected and has refused to reinstate. In re Unisys, 837 F.Supp. at 680-81; In re Unisys, 1994 WL 284079, at *28, aff'd, 58 F.3d at 907-08. There simply has been no mention by either this court or the court of appeals that the fiduciary duties implicated in this case arise in connection with decisions other than the one about when to retire.
This court originally granted summary judgment on the retirees' breach of fiduciary duty claims. I reinstated them because of a window opened by the Third Circuit Court of Appeals in Bixler v. Central Pennsylvania Teamsters Health and Welfare Fund, 12 F.3d 1292 (3d Cir.1993). In that case, the court of appeals recognized a direct cause of action under 29 U.S.C. § 1132(a)(3)(B) for breach of fiduciary duty when a plan administrator failed to advise the plaintiff, a widow of a plan participant, of information concerning COBRA election rights which may have been material to her decisions regarding whether to exercise those rights. Id. at 1302. The court of appeals found evidence that the employer knew that the widow had substantial unpaid medical expenses and that she could have received reimbursement for those expenses by signing and returning a COBRA notice her husband had received. Id. While the employer did not lie to the widow about the availability of the benefits, it did fail to convey the information to her when she contacted it about another issue. The widow then failed to elect to continue her medical coverage under COBRA. The court of appeals held that the employer may have breached its fiduciary duty by not providing full information that the employer had reason to know would be material to the plaintiff's decisions. Id. at 1302-03.
This court, believing that the reasoning of Bixler and other recent appellate decisions might support the retirees' claims for breach of fiduciary duty, reinstated the Sperry regular retirees' breach of fiduciary duty claims. However, I certified the case for interlocutory appeal because of the "uncertainty of the contours of Bixler." In re Unisys, 1994 WL 284079, at *27. When the court of appeals affirmed the reinstatement of the fiduciary claims, that court confronted two governing principles of ERISA cases. The first is the "well-established policy disfavoring informal plan amendments." In re Unisys, 57 F.3d at 1264. The second is the paramount importance of the summary plan description ("SPD") as the primary means of informing plan participants of the terms of their benefit *644 plans. See Curtiss-Wright, 514 U.S. at ___, 115 S.Ct. at 1230 (emphasizing the importance of SPDs for communicating essential elements of the plan to participants). The court of appeals expanded its ruling in Bixler because of the extraordinary history of misrepresentations in this case, but it was careful to emphasize that it was not creating a "precedent for any beneficiary to make claims beyond those provided in a plan." In re Unisys, 57 F.3d at 1265 (citation omitted). In discussing the evidence of resulting harm in this case, the court relied solely on the evidence that the misrepresentations "influenced [plaintiffs'] decisions to retire," Id. at 1266; it did not imply that other types of harm would support breach of fiduciary duty claims.
In allowing the breach of fiduciary claims to go forward, this court and the Court of Appeals for the Third Circuit have essentially held that reliance by the employees on the misrepresentations of Unisys, while not "reasonable reliance" for purposes of a claim of equitable estoppel, can still support a claim for breach of fiduciary duty. In a sense, the rulings in this case excuse the plan participants from their failure to read their summary plan documents in the limited context of making the retirement decision: because of the breach of duty, the employees may have retired earlier than they otherwise would have, and even if their reliance on the misrepresentations was not reasonable, the reliance supports a breach of fiduciary duty claim because it was at least partially the fault of Unisys.
The "unreasonable" reliance excused here is narrow, and supports a breach of fiduciary duty claim only in certain limited circumstances in this case, where the employees retired earlier than they might have had they not been misled by the lifetime misrepresentations. This court believes that expanding the concept of "resulting harm" in this case to the types of reliance alleged in the retirees' affidavits would create an unjustified expansion of the narrow holdings of this court, and would by indirection reinstate the claims for equitable estoppel.
Plaintiffs rely on In re Unisys Savings Plan Litigation, 74 F.3d 420 (3d Cir.), cert denied sub nom. Unisys Corp. v. Meinhardt, ___ U.S. ___, 117 S. Ct. 56, 136 L. Ed. 2d 19 (1996), and Curcio v. John Hancock Mut. Life Ins. Co., 33 F.3d 226 (3d Cir.1994) in support of their arguments that breach of fiduciary duty claims can proceed where plan participants rely on incomplete or inaccurate representations from plan administrators to make decisions about investments or insurance coverage. These cases are distinguishable for two important reasons. First, unlike the retirees in this case, the plaintiffs in Curcio and Unisys Savings Plan did not have available SPDs which unambiguously provided the material information. For the Curcio and Unisys Savings Plan plaintiffs, a careful reading of the SPD by the average plan participant would not have revealed the material information. Curcio, 33 F.3d at 236-37; Unisys Savings Plan, 74 F.3d at 431, 447.[17]
Second, and more importantly, in Curcio and Unisys Savings Plan the nexus between the misrepresentations and the reliance was close. The Curcios did not purchase insurance (and then did not have enough insurance) because they relied on misrepresentations about insurance policies the Curcios already had; the Unisys Savings Plan participants alleged that they made poor investment decisions (and then lost money on their investments) because they relied on the defendant's silence regarding material investment risks. These cases are consistent with the decision by this court that there is a close nexus between Unisys' misrepresentations about lifetime benefits and Plaintiffs' reliance on those representations in determining when to retire (and then retiring earlier than they would have in the absence of misrepresentations). However, the nexus between Unisys' misrepresentations about the duration of the lifetime benefits guarantee and *645 the other types of reliance presented to the court, such as forsaken opportunities for insurance, employment, and investment, is not as close. This nexus, while it might suffice as reliance in an equitable estoppel claim, is simply too tenuous to constitute the resulting harm in a breach of fiduciary duty claim. The misrepresentations must be material ones; the harm must flow directly from the breach. The court of appeals has held that "[i]n the present context, a misrepresentation is material if there is a substantial likelihood that it would mislead a reasonable employee in making an adequately informed retirement decision." In re Unisys, 57 F.3d at 1264. Given the facts of this case, this court will not expand the concept of materiality to include other types of reliance beyond the decision to retire.
VI. EQUITABLE REMEDIES
Unisys has moved for summary judgment against all retirees "insofar as they seek restitution or specific performance in the form of vested medical benefits." Def. Mot. Partial Summ.Judg. on Claims of Sperry Regular Retirees ¶ 4; Def. Mot. Partial Summ.Judg. on Claims of Burroughs and Unisys Regular Retirees ¶ 3. The parties have fully briefed and argued the issue of what equitable remedies are properly available to the retirees who remain in the class and who prove all the elements of their breach of fiduciary duty claims. The court will address equitable remedies in a separate opinion. Defendant's Motions for Partial Summary Judgment regarding the equitable remedies available in this case are therefore deferred.
VII. SPERRY RETIREES' MOTION FOR SUMMARY JUDGMENT
As stated earlier in this opinion, the Court of Appeals for the Third Circuit has established four elements for each plaintiff to prove in order to succeed on his or her breach of fiduciary duty claim: proof of fiduciary status, misrepresentations, company knowledge of the confusion, and resulting harm to the plaintiff. The Sperry retirees have moved for summary judgment, asking the court to hold that there is no genuine factual dispute preventing the legal conclusion that the Sperry retirees have proved all four elements of their claims.
When this court reinstated the Sperry plaintiffs' breach of fiduciary duty claims, I explained that they had not been directly before the court during the trial of the contract and equitable estoppel claims. I did not hold that each plaintiff had proved his claim of breach of fiduciary duty; in fact, in granting reconsideration of them, I held:
[B]ecause some plaintiffs have stronger cases than others based on their specific inquiries and the information given to them personally, the court finds that subclasses, and possibly even individual hearings, will be necessary to adjudicate these claims.
In re Unisys, 1994 WL 284079, at *27.
Because at least one element of the claims, resulting harm, has not been proved on a class-wide basis, summary judgment cannot be entered for the Sperry plaintiffs. As has been discussed throughout this opinion, the harm contemplated by this court is a retiree's premature decision to retire based on a false sense of the security of the lifetime benefits promised by Unisys. The court finds that there is a genuine factual dispute about how many of the retirees actually suffered this type of harm. Additional discovery and hearings will be necessary to determine the extent of the reliance by and resulting harm to the retirees.
For the purpose of guiding the future discovery and proceedings, the court notes that the first element of the claims, proof of fiduciary status, has been established on a class-wide basis. The court of appeals has held:
There is no question that both Sperry and later Unisys were acting as plan administrators, and thus were acting in a fiduciary capacity, when they made the material misrepresentations that support the claim for breach of fiduciary duty in this case.
In re Unisys, 57 F.3d at 1261 n. 10. The second element, company misrepresentations, has also been proved on a class-wide *646 basis for all Sperry retirees.[18] This court found, and the court of appeals agreed, that Unisys "both actively and affirmatively, systematically misinformed its employees about the duration of their benefits." Id. at 1266. There is no genuine factual dispute that the retirees all heard or read, at least once, the lifetime benefit language.
The Sperry retirees' Motion for Summary Judgment is denied.
VIII. CONCLUSION
As this court has previously observed, this case comes at time when our country is grappling with the cost of medical care. This case arose because Unisys was faced with revised accounting standards, a more competitive global market, an increase in longevity, and rising health care costs. In the future, a case like this is unlikely to arise not only because employers will be more careful about communicating the nature and impact of reservation of rights clauses to their employees, but also because employers can no longer afford to offer the type of lifetime benefits which Unisys once provided.
The retirees in this litigation are individuals who worked, in some cases, for thirty or forty years for an employer in whom they placed great trust. The corporations which are defendants in this case provided generous medical benefits and would probably have continued to do so if costs had not so escalated and if accounting rules had not changed. This court has been faced with a case in which there is no villain, and a case in which both sides will suffer serious financial loss if they do not prevail. Faced with this difficult situation, a careful study of the text and case law of ERISA convinces the court that the statute of limitations bars the claims of many of the retirees, and that many of the retirees cannot demonstrate the resulting harm required to maintain a breach of fiduciary duty claim.
An appropriate order follows.
ORDER
AND NOW, this 10th day of March, 1997, upon consideration of the following motions and the opposition thereto: (1) Defendant Unisys Corporation's Motion for Partial Summary Judgment on Breach of Fiduciary Duty Claims of Sperry Regular Retirees; (2) Defendant Unisys Corporation's Motion for Partial Summary Judgment on Breach of Fiduciary Duty Claims of the Burroughs and Unisys Regular Retirees; and (3) Plaintiff Sperry Regular Retirees' Motion for Summary Judgment; IT IS ORDERED as follows:
1. Summary Judgment is GRANTED in favor of Unisys on the claims of all Sperry regular retirees who retired before November 17, 1986, six years before the first lawsuits were filed by the Sperry retirees.
2. Summary Judgment is GRANTED in favor of Unisys on the claims of all Sperry regular retirees who retired before lifetime medical benefits were offered in their operating division.
3. Summary Judgment is GRANTED in favor of Unisys on the claims of all Sperry regular retirees whose employment with Sperry ended involuntarily as a result of being laid off, fired or disabled before they retired, or as a result of being forced to retire at age 65 pursuant to Sperry's then-lawful mandatory retirement age.
4. Summary Judgment is GRANTED in favor of Unisys on the claims of all Burroughs regular retirees who retired before December 3, 1986, six years before the first lawsuits were filed by the Burroughs retirees.
5. Summary Judgment is GRANTED in favor of Unisys on the claims of all Burroughs and Unisys regular retirees whose employment with Burroughs or Unisys ended involuntarily as a result of being laid off, fired or disabled before they retired, or as a result of being forced to retire at age 65 pursuant to Burroughs' then-lawful mandatory retirement age.
6. The Sperry Regular Retirees' Motion for Summary Judgment is DENIED.
*647 7. Unisys shall provide the attorneys representing the Sperry, Burroughs and Unisys retirees with a list of those retirees affected by this Order within fourteen (14) days of the date of this Order. Counsel for the Sperry, Burroughs and Unisys retirees shall then have fourteen (14) days to review that list and raise any objections to the accuracy of the list with Unisys. The parties shall then make their best efforts to resolve any disputes regarding the list, and shall submit an agreed-upon list, as well as a list of disputed retirees, to the Court no later than April 21, 1997.
NOTES
[1] Unisys Corporation is the product of a 1986 merger between the Sperry and Burroughs Corporations. The class of plaintiffs includes former employees of all three corporations. Unless otherwise stated, this opinion will use the term "Unisys" to refer to all three companies.
[2] The factual and procedural history in this case is extensive, and the court will not repeat it in detail here. For a summary of the factual background in this action, see In re Unisys Corp. Retiree Medical Benefits ERISA Litig., 837 F. Supp. 670, 672 (E.D.Pa.1993), aff'd, 61 F.3d 896 (3d Cir.1995).
[3] The sub-class of Sperry retirees includes "[a]ll non-union retired, disabled and other eligible former employees and their spouses and dependents who as of November 3, 1992 were participants in or beneficiaries of the employee welfare benefit plans pursuant to which Unisys or its predecessor, Sperry Corporation, has provided medical benefits to former employees of Sperry Corporation (or any division or unit thereof) who retired, became disabled or otherwise became eligible on or before April 1, 1989." In re Unisys, 837 F.Supp. at 677 n. 10.
The sub-class of Burroughs retirees includes "[a]ll non-union retired, disabled and other eligible former employees and their spouses and dependents who as of November 3, 1992 were participants in or beneficiaries of the employee welfare benefit plans pursuant to which Unisys or its predecessor, Burroughs Corporation, has provided medical benefits to former employees of Burroughs Corporation (or any division or unit thereof) who retired, became disabled or otherwise became eligible on or before May 1, 1989." Id. at 676 n. 9.
The sub-class of Unisys retirees includes "[a]ll non-union retired, disabled and other eligible former employees and their spouses and dependents who as of November 3, 1992 were participants in or beneficiaries of the employee welfare benefit plans pursuant to which Unisys has provided medical benefits to former employees of Unisys who retired, became disabled or otherwise became eligible on or after April 2, 1989, in the case of former Sperry employees, and May 2, 1989, in the case of former Burroughs employees." Id. at 675 n. 8.
[4] In Bixler v. Central Pa. Teamsters Health and Welfare Fund, 12 F.3d 1292 (3d Cir.1993), the Third Circuit Court of Appeals held that direct actions for breach of fiduciary duty are available to individual plan participants under § 1132(a)(3)(B). The Supreme Court has since agreed with this conclusion. Varity Corp. v. Howe, ___ U.S. ___, ___ - ___, 116 S. Ct. 1065, 1075-1079, 134 L. Ed. 2d 130 (1996).
[5] At this point, however, the court will take a moment to clear up a point of confusion about the number of elements in the Sperry retirees' claims. Unisys reads In re Unisys, 57 F.3d at 1265-66, to require three additional elements beyond the four listed above: evidence on the materiality of the misrepresentations, Unisys' awareness of their materiality, and the employees' reliance on the misrepresentations. This court agrees with the retirees that the Third Circuit's discussion of these issues did not set forth additional elements for the retirees to prove. Rather, the court outlined the evidence supporting the four elements, and explained that the evidence of materiality and reliance sufficed to support the elements of the breach of fiduciary duty cause of action.
[6] The recent decision by the court of appeals in Ream v. Frey, 107 F.3d 147 (3d Cir.1997) reaffirms this proposition. In that case, the court ruled that "it would be overly formalistic (and contrary to the explicit statutory directives in ERISA)" to hold a fiduciary's compliance with the terms of a plan necessitates a finding that the fiduciary satisfied its fiduciary duties. Id. at 154-55.
[7] Unisys contends that some of the retirees' claims will be time-barred through the operation of the three-year statute of limitations which begins when a plaintiff has "actual knowledge" of the actions constituting the breach of fiduciary duty. Unisys does not contend that it has presented evidence allowing this court to make a class-wide finding of actual knowledge. Therefore, the court need not determine whether any of the plaintiffs are barred by the three-year statute of limitations.
[8] Unisys asserts that the retirees' assertions of fraud and concealment were not pleaded with specificity as required by Federal Rule of Civil Procedure 9(b). Unisys Reply Mem. Supporting Partial Summ.Judg. on Claims of Sperry Retirees at 11 n. 4. The court has chosen to deal with the merits of the fraud allegation, but notes that lack of specificity as to the fraud allegations supports its decision on the merits.
[9] The Kurz opinion explicitly left the question undecided. 96 F.3d at 1552 n. 5. There is disagreement among the courts that have addressed the issue. Compare J. Geils Band Employee Benefit Plan v. Smith Barney Shearson, Inc., 76 F.3d 1245, 1253 n. 9 (1st Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 81, 136 L. Ed. 2d 39 (1996) (leaving the question open but implying it is likely to hold the exception will apply to self-concealing wrongs) and Diduck v. Kaszycki & Sons Contractors, Inc., 874 F.2d 912, 919-20 (2d Cir.1989) (exception applies if fraud and concealment involved in the underlying breach), with Radiology Center, S.C. v. Stifel, Nicolaus & Co., 919 F.2d 1216, 1220 (7th Cir.1990) (concluding the exception refers only to active concealment to hide the breach, not to "the underlying nature of plaintiffs' claim"); and Schaefer v. Arkansas Medical Soc., 853 F.2d 1487, 1491-92 (8th Cir. 1988) (only discussing active concealment in determining whether to apply fraud or concealment exception).
[10] In an effort to make financial statements more accurately reflect the true liabilities of companies, FAS 106 required employers, beginning in fiscal year 1992, to "accrue an expense against current income for the expected future cost of post-retirement benefits and to recognize on its balance sheet a liability for unfunded benefit costs." In re Unisys, 1994 WL 284079, at *34 n. 7 (citations omitted).
[11] Misrepresentations are generally considered fraudulent only if scienter is present. See, Restatement of Torts 2d § 526 (1976). Scienter "refers to a mental state embracing intent to deceive, manipulate, or defraud." Ernst & Ernst v. Hochfelder, 425 U.S. 185, 193 n. 12, 96 S. Ct. 1375, 1381 n. 12, 47 L. Ed. 2d 668 (1976). In some contexts, recklessness meets the standard for scienter. See, e.g., In re Phillips Petroleum Securities Litig., 881 F.2d 1236, 1244 (3d Cir. 1989) (interpreting § 10(b) of the Securities Exchange Act). At oral argument, the retirees asked the court to find that Unisys' misrepresentations meet, if not the level of intentional deception, then at least the level of recklessness.
Because this issue was raised for the first time at oral argument and the parties have not briefed it, the court will not determine whether reckless misrepresentations can satisfy fraud's scienter requirement in the context of an ERISA breach of fiduciary duty. Regardless of the answer to this question, the court has no factual basis on which to find the company's misrepresentations reckless. The retirees have presented no evidence that at the time the misrepresentations were made, anyone at Unisys either knew there was no basis for the representations or ignored an obvious danger of misleading the retirees. Cf. Restatement of Torts 2d § 526(b-c) (recklessness means making statements with either no confidence in their accuracy or with knowledge that there is no basis for them); In re Phillips Petroleum, 881 F.2d at 1244 (fraudulent misrepresentation encompasses "an extreme departure from the standards of ordinary care, ... which presents a danger of misleading ... that is either known ... or is so obvious that the actor must have been aware of it.") (citations omitted).
[12] The court has ruled that the breach alleged is an action rather than an omission. However, a determination that the case is about omissions would lead to the same conclusion about the date the statute of limitations began to run. If the omission was Unisys's failure to correct an employee's misunderstanding of the lifetime guarantee, then the last date on which Unisys could have cured the breach was the day that employee retired thinking that his or her benefits were irrevocable "for life."
[13] It should be noted that what is referred to in the Seventh Circuit as "equitable estoppel" is the same doctrine referred to in this circuit as "equitable tolling." Oshiver, 38 F.3d at 1389 n. 7. Equitable tolling ("equitable estoppel" in the Seventh Circuit) refers, at least in the context of this case, to a doctrine tolling the statute of limitations where a plaintiff's delay is due to active deception by a defendant.
The Court of Appeals for the Seventh Circuit has a different use for the term "equitable tolling." As used in that circuit, "equitable tolling" describes the doctrine of tolling the limitations period in cases where constructive knowledge activates the statute of limitations, but defendants have perpetrated a self-concealing wrong which the plaintiffs could not discover with reasonable diligence. This concept does not apply to ERISA breach of fiduciary duty cases because § 1113(2) makes it unnecessary the statute requires actual, not merely constructive, knowledge of the breach in order to commence the three year statute of limitations. Wolin, 83 F.3d at 853; see Gluck, 960 F.2d at 1177-78.
[14] Section 9(c) states in part:
No action shall be maintained to enforce any liability created under this section, unless brought within one year after the discovery of the facts constituting the violation and within three years after such violation.
15 U.S.C. § 78i(e). Section 18(c) uses similar language:
No action shall be maintained to enforce any liability created under this section unless brought within one year after the discovery of the facts constituting the cause of action and within three years after such cause of action accrued.
15 U.S.C. § 78r(c).
[15] Even if the doctrine of equitable tolling were applicable to ERISA breach of fiduciary duty actions, the court would not apply the doctrine to this case. In this circuit, there are three principal, though not exclusive, situations in which equitable tolling may be appropriate: (1) where the defendant has actively misled the plaintiffs respecting their cause of action; (2) where the plaintiffs have in an extraordinary way been prevented from asserting their rights; or (3) where plaintiffs have timely asserted their rights but in the wrong forum. Oshiver, 38 F.3d at 1387. (citations omitted). The first situation is the closest fit to this case. Unisys' misrepresentations may have "lulled the plaintiff[s] into foregoing prompt attempts to vindicate [their] rights." Id. (citations omitted). However, unlike most of the cases in which equitable tolling has been applied, this case does not involve fraudulent or pretextual statements by Unisys. If it did, the statutory six year tolling for fraud or concealment would apply. Attempting to apply the doctrine of equitable tolling to the facts of this case reveals that the doctrine does not make sense in connection with § 1113: by including a six year tolling period for fraud or concealment, the statute already provides tolling in the majority of cases in which equitable tolling would actually apply.
[16] Most of the retirees addressed in Unisys' argument in this regard are also plaintiffs who retired more than six years before the first lawsuits in this case were filed. For example, until the Age Discrimination in Employment Act ("ADEA") was enacted, Sperry required all its employees to retire by age 65. In response to the ADEA's prohibition of involuntary retirement based on age, 29 U.S.C. § 623(f)(2), Sperry eliminated its mandatory retirement age in 1979. (Affidavit of Jay W. Brubaker, Def. Exh. 7, ¶ 4, Def.Append. to Mot. for Partial Summ.Judg. on Claims of Sperry Retirees). Plaintiffs who retired when the mandatory retirement age was 65 would by necessity also fall into the category of plaintiffs who retired more than six years before the first suits were filed in this case. Therefore, the court has already held that many of these claims are time-barred. Nevertheless, the court proceeds with the analysis to cover those plaintiffs who allegedly cannot prove an element of their claims but who are not time-barred.
[17] In fact, the court of appeals in Curcio entered summary judgment for the plaintiff on an equitable estoppel theory. The reliance of plaintiff on the company's inaccurate representations was therefore reasonable. By contrast, in this case, the retirees' estoppel claims were denied because the retirees' reliance on the lifetime promises, in the face of unambiguous SPDs, was not reasonable.
[18] This conclusion does not apply to those plaintiffs who retired before "lifetime" language was used in their division. The court has granted summary judgment for Unisys against all retirees who retired before the misrepresentations were made to them. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581486/ | 42 So. 3d 1088 (2010)
Lisa ALFANO, et al.
v.
LAFAYETTE CITY-PARISH CONSOLIDATED GOVERNMENT, et al.
No. 09-1428.
Court of Appeal of Louisiana, Third Circuit.
June 30, 2010.
*1089 John M. Jefcoat, Catherine A.F. Adair, Galloway, Jefcoat, L.L.P., Lafayette, LA, for Plaintiff-Appellant, Lisa Alfano.
Paul D. Gibson, Jason B. Boudreaux, Gibson, Gruenert & Zaunbrecher, P.L.L.C., Lafayette, LA, for Defendant-Appellee, Lafayette City-Parish Consolidated Government.
Court composed of ULYSSES G. THIBODEAUX, Chief Judge, SYLVIA R. COOKS, and ELIZABETH A. PICKETT, Judges.
COOKS, Judge.
Plaintiffs, Lisa Alfano and Susan Sconiers, appeal the judgment of the trial court granting summary judgment in favor of Defendant, Lafayette City-Parish Consolidated Government (LCG). Finding summary judgment was inappropriate in this matter, we reverse and remand.
FACTS AND PROCEDURAL HISTORY
On August 11, 2007, Lisa Alfano was driving her Buick Regal on West Pinhook Street in Lafayette, Louisiana. Susan Sconiers was a guest passenger in the vehicle. While stopped at a red light, Ms. Alfano's vehicle was struck from behind by a white pick-up truck. After being struck, Ms. Alfano exited her vehicle and spoke with the man driving the truck. The man asked her if she was alright and then apologized for hitting her. Ms. Alfano then turned from the man to call 911 on her cell phone. As she did this, the unidentified driver got back in his truck and began to flee the scene.
According to Ms. Alfano, just as the white truck was fleeing Officer Covey Menard, of the Lafayette City Police Department, arrived at the scene. Ms. Alfano testified that the sequence of events of her calling 911, the unidentified driver fleeing the scene, and the Officer Menard's arrival took place within a matter of seconds.
When Officer Menard approached her, Ms. Alfano told him she had just been rear-ended and that the hit-and-run driver was still in sight and was just beginning to stop at the next light on the same street. *1090 She asked Officer Menard to try to apprehend the driver, and he refused, stating that "by the time I get to the red light he'll be gone and I won't catch him." According to Officer Menard, he looked in the direction Ms. Alfano claimed the hit-and-run driver fled, but could not see any white truck in sight. Therefore, he determined apprehension of the hit-and-run driver at that time was unlikely, and chose instead to focus on the accident scene. He stated he moved the damaged vehicle from the street in order to prevent further accidents.
After moving the vehicle to an adjacent parking lot and interviewing both Ms. Alfano and Ms. Sconiers, Officer Menard completed a "Uniform Vehicle Traffic Crash Report" and a "Hit & Run Accident Report." There were no witnesses to the accident. The hit-and-run driver was never apprehended.
On August 8, 2008, Plaintiffs, Lisa Alfano and Susan Sconiers, filed suit seeking damages against John Doe (the unidentified driver), ABC Entity (the unidentified employer of John Doe), ABC Insurance Company (the unidentified automobile insurer of John Doe), DEF Insurance Company (the unidentified automobile insurer of ABC Entity), State Farm Mutual Automobile Insurance Company (the UM carrier that provided coverage on Ms. Alfano's vehicle) and LCG. Only State Farm and LCG were served with and filed answers to the petition for damages.
In particular, LCG filed an answer asserting various affirmative defenses and a Motion for Summary Judgment seeking a dismissal of all claims against it. LCG specifically argued Officer Menard made a defensible exercise of discretion that entitled him and LCG to governmental immunity from Plaintiffs' claims. The trial court agreed with LCG, finding Officer Menard reasonably determined that apprehension of the hit-and-run driver was not possible, and made a "defensible discretionary decision at the accident scene to protect the scene and protect the public from another accident rather than pursue the white work truck which he didn't see." Finding that exercise of discretion entitled Officer Menard and LCG to qualified immunity, the trial court granted the motion for summary judgment.
Plaintiffs appealed the trial court's judgment, asserting the following assignments of error:
1. The trial court erred in granting summary judgment in favor of LCG as no statute or jurisprudence exists establishing a dual duty to either secure an accident scene or fully investigate an accident.
2. The trial court erred in granting summary judgment in favor of LCG as genuine issues of material fact exist regarding the investigating officer's duty to apprehend the unknown hit-and-run driver.
3. The trial court erred in granting summary judgment ion the issue of immunity under La.R.S. 9:2798.1 as genuine issues of material fact exist regarding the investigating officer's non-discretionary duty to apprehend the unknown hit-and-run driver.
ANALYSIS
Summary judgment is appropriate only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law." La.Code Civ.P. art. 966(B). Louisiana Code of Civil Procedure Article 966 provides the standard for considering motions for summary judgment. Specifically, La.Code Civ.P. art. 966(C) provides:
*1091 (1) After adequate discovery or after a case is set for trial, a motion which shows that there is no genuine issue as to material fact and that the mover is entitled to judgment as a matter of law shall be granted.
(2) The burden of proof remains with the movant. However, if the movant will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, the movant's burden on the motion does not require him to negate all essential elements of the adverse party's claim, action, or defense, but rather to point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense. Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no genuine issue of material fact.
The burden to show that no material issues of fact exist remains with the movant, but this burden shifts to the adverse party once the movant has made a prima facie showing that the motion should be granted. Hayes v. Autin, 96-287 (La.App. 3 Cir. 12/26/96), 685 So. 2d 691, writ denied, 97-281 (La.3/14/97), 690 So. 2d 41. However, "[i]f qualifying evidence is submitted in opposition to a motion for summary judgment which creates a dispute as to a genuine issue of material fact, the motion for summary judgment should be denied." Indep. Fire Ins. Co. v. Sunbeam Corp., 99-2181, 99-2257, p. 19 (La.2/29/00), 755 So. 2d 226, 237.
LCG argues under La.R.S. 9:2798.1, a "public entity," such as itself, is not liable for injuries caused by discretionary duties made by its employees in the course and scope of their employment. La.R.S. 9:2798.1 provides:
A. As used in this Section, "public entity" means and includes the state and any of its branches, departments, offices, agencies, boards, commissions, instrumentalities, officers, officials, employees, and political subdivisions and the departments, offices, agencies, boards, commissions, instrumentalities, officers, officials, and employees of such political subdivisions.
B. Liability shall not be imposed on public entities or their officers or employees based upon the exercise or performance or the failure to exercise or perform their policymaking or discretionary acts when such acts are within the course and scope of their lawful powers and duties.
C. The provisions of Subsection B of this Section are not applicable:
(1) To acts or omissions which are not reasonably related to the legitimate governmental objective for which the policymaking or discretionary power exists; or
(2) To acts or omissions which constitute criminal, fraudulent, malicious, intentional, willful, outrageous, reckless, or flagrant misconduct.
D. The legislature finds and states that the purpose of this Section is not to reestablish any immunity based on the status of sovereignty but rather to clarify the substantive content and parameters of application of such legislatively created codal articles and laws and also to assist in the implementation of Article II of the Constitution of Louisiana.
A police officer's duty regarding investigating accidents is set forth in La.R.S. 32:398(D):
D. It shall be the duty of the state police or the sheriff's office to investigate all accidents required to be reported by this Section when the accident *1092 occurs outside the corporate limits of a city or town, and it shall be the duty of the police department of each city or town to investigate all accidents required to be reported by this Section when the accidents occur within the corporate limits of the city or town. Every law enforcement officer who investigates an accident, as required by this Subsection, shall instruct the driver of each vehicle involved in the accident to report the following to all parties suffering injury or property damage as an apparent result of the accident:
(1) The name and address of the owner and the driver of the vehicle.
(2) The license number of the vehicle.
(3) The name of the liability carrier for the vehicle, the name, address, and telephone number of the insurance agent who procured the liability policy providing coverage for the vehicle.
LCG concedes a police officer has a statutory duty under La.R.S. 32:398(D) to investigate an automobile accident. Further, Lafayette Police Department General Order 304.3[1] provides that "when a driver involved in an accident has left the scene, the investigating officer shall attempt to apprehend said driver and take the appropriate enforcement action(s). If apprehension is not possible, the officer shall forward the pertinent information to the Hit-&-Run Officer along with all paperwork." (Emphasis added.)
In the present case, there is no question that Officer Menard did not attempt to apprehend the hit-and-run driver, as is required by General Order 304.3. Officer Menard could only avoid his duty to apprehend the driver if "apprehension [was] not possible." Although, Officer Menard testified the hit-and-run vehicle was not in sight, both plaintiffs maintained it was stopped at a nearby light. Thus, for the trial court to find apprehension was not possible, it had to make a factual conclusion, which is expressly not allowed at the summary judgment stage. The transcript of the trial court's oral reasons for judgment demonstrate the factual conclusion it drew in reaching judgment, specifically stating Officer Menard made a "defensible discretionary decision at the accident scene to protect the scene and protect the public from another accident rather than pursue the white work truck which he didn't see." (Emphasis added)
While Plaintiffs concede a violation of General Order 304.3 does not create negligence per se, they contend that whether or not Officer Menard complied with Order 304.3 is relevant to whether or not he breached a duty to them. Such genuine issues of material fact preclude the granting of summary judgment.
Further, Plaintiffs dispute that the accident scene needed to be secured. They note that Ms. Alfano's vehicle was still in working condition and she could have driven her vehicle into the adjacent parking lot while Officer Menard attempted to apprehend the hit-and-run driver. It also was readily apparent, that while both Ms. Alfano and Ms. Sconniers were injured in the accident, they did not suffer from injuries which required immediate emergency attention. Thus, Officer Menard was free to either attempt to apprehend the fleeing driver or call another officer for help, which would follow the mandates of Lafayette *1093 Police Department General Order 304.3.
LCG cited two cases, which it claims support its position that Officer Menard fulfilled his required duties. In White v. City of Kenner through its Police Department, 08-195 (La.App. 5 Cir. 9/16/08), 996 So. 2d 294, writ denied, 08-2503 (La.12/19/08), 996 So. 2d 1135, the plaintiff therein alleged the investigating officer failed to comply with his statutory duty under La.R.S. 32:398(D) because he did not include the name of an individual stopped at the scene of the accident. The investigating officer in White contended in conducting his investigation of the accident, he found nothing to corroborate the plaintiff's belief that the unknown driver was at fault in causing the accident. Based on that belief, he did not issue a citation or obtain the name of the unknown driver. The court in White held the investigating officer had complied with La.R.S. 32:398(D) because he conducted his investigation and obtained the information from the parties actually involved in the accident, and it was clearly within the officer's discretion to determine who was involved in the accident.
We find White to be distinguishable from the present case. There is no question in this case that the hit-and-run driver was involved in the accident. As Plaintiffs argue, White does not stand for the proposition that where an investigating officer fails to investigate the parties involved in the accident he has complied with La.R.S. 32:398(D). In fact, White would seem to require the opposite result.
LCG also cites Laguerre v. Mendez, 08-784 (La.App. 5 Cir. 2/25/09), 9 So. 3d 896. In that case, the plaintiff therein was involved in a hit-and-run accident. The plaintiff claimed after the accident he found the offending vehicle and notified the investigating officer of its whereabouts. The investigating officer had the vehicle towed to an impound lot, but conducted no further investigation in to the identity of the driver. Plaintiff argued the officer had a duty to perform a follow-up investigation to locate the driver of the vehicle. The court held La.R.S. 32:398(D) did not contain a provision requiring a follow-up investigation beyond the initial investigation.
Again, this case is factually distinguishable from the instant case. In this case, Officer Menard was conducting an initial investigation when the alleged failure to comply with La.R.S. 32:398(D) occurred. As Plaintiffs argue, Laguerre provides little guidance considering the facts presented in this case.
In support of their position that Officer Menard's actions did not satisfy his duties under La.R.S. 32:398(D), Plaintiffs cite Fischer v. Travelers Ins. Co., 429 So. 2d 538 (La.App. 4 Cir.1983). In Fischer, the investigating officer misplaced and then failed to submit or file an investigation report regarding the accident. The plaintiff therein filed suit against the officer and the City of New Orleans. The trial court held the plaintiff had been injured by the officer's failure to file an investigation report because it caused him to "lose his opportunity to pursue a claim against the other driver." The appellate court in Fischer adopted the trial court's Reasons for Judgment, which stated "[t]his requirement [of 32:398(D)] could have no other purpose than to facilitate any civil claims that may have arisen. This being so, the police officer violated a statutory duty which included within the ambit of its protection a risk of harm such as occurred here." Id. at 540.
Plaintiffs acknowledge the facts in Fischer are also distinguishable from those in the present case, but contend the Fischer court's determination that La.R.S. 32:398(D) was enacted to facilitate civil claims is noteworthy.
*1094 Lastly, Plaintiffs contend summary judgment on the issue of governmental immunity under La.R.S. 9:2798.1 was improper in this case because there were general issues of material fact regarding whether Officer Menard complied with the requirements of both La.R.S. 32:398(D) and General Order 304.3 or whether his actions were discretionary. They note the Louisiana Supreme Court has stated "the discretionary function exception [to La. R.S. 9:2798.1] will not apply when a ... statute, regulation or policy specifically prescribes a course of action for an employee to follow. In this event, the employee has no rightful option but to adhere to the directive." Hardy v. Bowie, 98-2821, p. 11 (La.9/8/99), 744 So. 2d 606, 613.
CONCLUSION
After a thorough review of the jurisprudence, we do not find, as LCG contends, that it supports the argument that it is entitled to judgment as a matter of law. None of the cases cited stand for the proposition that an officer is allowed to choose which duties to fulfill. Further, there are clear issues of material fact as to whether Officer Menard fulfilled his duties under both La.R.S. 32:398(D) and General Order 304.3, which until they are resolved cannot entitle LCG to governmental immunity under La.R.S. 9:2798.1. Those issues of fact must be decided at a trial on the merits. Therefore, we reverse the trial court's grant of summary judgment and remand for further proceedings consistent with this opinion. All costs of this appeal are assessed against appellee, Lafayette City-Parish Consolidated Government.
REVERSED AND REMANDED.
PICKETT, J., concurs in the result.
NOTES
[1] LCG argues General Order 304.3 should not be considered by this court, because it lacks "sufficient evidentiary quality" to be given weight in determining whether there is a genuine issue of material fact. This argument is based on the fact that it is not an affidavit or sworn to in any way. However, as Plaintiffs note, LCG specifically acknowledged the authenticity of General Order 304.3 at the hearing on the motion for summary judgment. Thus, we find no merit in its argument that General Order 304.3 has never been authenticated or verified. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545441/ | 490 Pa. 607 (1980)
417 A.2d 205
Domenic A. BORELLO, Jr., et al., Appellants,
v.
COMMONWEALTH of Pennsylvania, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW.
Robert F. BOLSINGER et al., Appellants,
v.
COMMONWEALTH of Pennsylvania, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW.
Eneo PANICCO et al., Appellants,
v.
COMMONWEALTH of Pennsylvania, UNEMPLOYMENT COMPENSATION BOARD OF REVIEW.
Supreme Court of Pennsylvania.
Argued March 4, 1980.
Decided July 16, 1980.
*608 *609 Stanford A. Segal, Gatz, Cohen, Segal & Koerner, P.A., Pittsburgh, for appellants.
Michael D. Klein, Asst. Atty. Gen., Unemployment Compensation Board of Review, Harrisburg, for appellee.
Before EAGAN, C.J., and O'BRIEN, ROBERTS, NIX, LARSEN, FLAHERTY and KAUFFMAN, JJ.
OPINION
NIX, Justice.
This is an appeal from the decision of the Commonwealth Court which affirmed the orders of the Unemployment Compensation Board of Review (Board), appellee, denying benefits to appellants under Section 402(d) of the Pennsylvania Unemployment Compensation Law, Act of December 5, 1936, Second Exec. Sess., P.L. (1937) 2897, art. IV, § 402, as amended, 43 P.S. § 802(d).
Appellants are members of three separate groups, each of whom were employed by Townsend and Bottum, Inc., for the construction of the Bruce Mansfield Fossil-Fuel project at Shippingport, Pennsylvania during 1976. The three groups consisted of: (1) members of various building and construction craft unions (Craft Unions); (2) members of the Iron Workers Local 3 (Ironworkers); and (3) members of Millwrights Local 2235 (Millwrights).
A review of the record reveals the following sequence of events. On May 31, 1976, various labor-management agreements covering among others, the appellants, expired. On or before June 1, 1976, the Craft Unions did reach an accord, but neither the Ironworkers nor the Millwrights were able *610 to reach mutually satisfactory agreements with Townsend and Bottum. Prior to the expiration of the respective contracts, the Ironworkers and Millwrights offered to enter into an interim agreement but required as part of that agreement that any wage increase subsequently won for the new contract be retroactive to June 1, 1976. Management refused and stated as a matter of policy "that if no agreement tentative or otherwise, was reached by June 1, 1976,. . . it would . . . not allow the Ironworkers and Millwrights to enter the various construction sites. . ." (Board's Finding of Fact 15). No further formal offer to continue work was conveyed by either party before the deadline. No evidence of a formal strike vote nor any instruction from union leaders to its membership not to report for work on June 1, can be found in the record.
The construction site security guards were advised by management that as of June 1, 1976, Ironworkers and Millwrights were to be denied entry while all other building and craft union members could be admitted as usual. On the morning of June 1, 1976, certain job stewards and union representatives reported to the construction site and were denied entry by the security guards. The same occurred on June 2, 1976. On June 3, 1976, the two foreclosed unions set up peaceful picket lines at various job sites throughout Western Pennsylvania including the instant project. Their "picket signs" asserted the failure of management to bargain in good faith. The Craft Union members reported for work that morning, but did not enter the project for work nor did they do so until after the labor dispute was resolved on June 21, 1976.
Appellants filed for unemployment compensation for the period from June 1, to June 21, 1976. After their claims were denied by the Bureau of Employment and Security, the referee agreed with that determination, and the Unemployment Compensation Board of Review affirmed on appeal. The matters were consolidated before the Commonwealth Court and after argument, it found the Board's determination supported by the evidence and thus denied appellants' request for relief. 40 Pa. Cmwlth. 353, 397 A.2d 471 (1979).
*611 We turn first to the claim by appellants, Millwrights and Ironworkers that the lower court erred in affirming the denail of compensation under Section 402(d). Our scope of review is limited to a determination as to whether any errors of law were committed and, "absent fraud," that the Board's findings are supported by the evidence. Unemployment Compensation Board of Review v. Tickle, 19 Pa.Cmwlth. 550, 339 A.2d 864 (1975); see, e.g. Erie Forge and Steel Corporation v. Unemployment Compensation Board of Review, 400 Pa. 440, 163 A.2d 91 (1960).
The Millwrights and Ironworkers assert their entitlement to unemployment benefits under Section 402(d) on the grounds that they were "locked-out." That provision provides:
An employe shall be ineligible for compensation for any week
(d) In which his unemployment is due to a stoppage of work, which exists because of a labor dispute (other than a lock-out) at the factory, establishment or other premises at which he is or was last employed: Provided, That this subsection shall not apply if it is shown that (1) he is not participating in, or directly interested in, the labor dispute which caused the stoppage of work, and (2) he is not a member of an organization which is participating in, or directly interested in, the labor dispute which caused the stoppage of work, and (3) he does not belong to a grade or class of workers of which, immediately before the commencement of the stoppage, there were members employed at the premises at which the stoppage occurs, any of whom are participating in, or directly interested in, the dispute. (Emphasis added.)
The determinative factor to the requested relief thus becomes whether the work stoppage was caused by an employer "lockout." The test for assessing responsibility for the work stoppage for purposes of the instant provision was enunciated in Erie Forge and Steel Corporation v. Unemployment Compensation Board of Review, supra, 400 Pa. at 444-445, 163 A.2d at 91.
*612 . . . The law contemplates that collective bargaining will be conducted in good faith, with a sincere purpose to find a basis for agreement. Neither an adamant attitude of "no contract, no work" on the part of the employees, nor an ultimatum laid down by the employer that work will be available only on his (employer's) terms, are serious manifestations of a desire to continue the operation of the enterprise. While either or both of these positions may legitimately be taken by the parties during the bargaining negotiations prior to the expiration of the existing contract, when the contract has in fact expired and a new agreement has not yet been negotiated, the sole test under § 402(d) of the Unemployment Compensation Law . . of whether the work stoppage is the responsibility of the employer or the employees is reduced to the following: Have the employees offered to continue working for a reasonable time under the pre-existing terms and conditions of employment so as to avert a work stoppage pending the final settlement of the contract negotiations; and has the employer agreed to permit work to continue for a reasonable time under the pre-existing terms and conditions of employment pending further negotiations? If the employer refuses to so extend the expiring contract and maintain the status quo, then the resulting work stoppage constitutes a "lockout" and the disqualification for unemployment compensation benefits in the case of a "stoppage of work because of labor dispute" does not apply. (Emphasis added).
This test has been consistently followed.[1]Unemployment Compensation Board of Review v. Sun Oil Co., 476 Pa. 589, *613 383 A.2d 519 (1978); Philco Corporation v. Unemployment Compensation Board of Review, 430 Pa. 101, 242 A.2d 454 (1968). As was recognized in Philco Corporation, supra, the Erie Forge test while "easy to verbalize (is) most difficult to apply to any given set of facts." The practical approach suggested there is "to determine which side, union or management, first refused to continue operations under the status quo after the contract had technically expired, but while negotiations were continuing." Id., 430 Pa. at 103, 242 A.2d at 455 (Emphasis added).
Appellee contends that the Millwrights' and Ironworkers' demand for retroactive application from the date of expiration for any additional benefits won under the new contract as a prerequisite to its continuing work, caused the work stoppage and thus blame lay with those parties and not with the employer. Both the Board[2] and the Commonwealth *614 agreed.[3] The problem with this reasoning is it fails to apply the Erie Forge test. Under that test the focus is upon the actions of the parties "after the contract has in fact expired" and immediately preceding the work stoppage. The assertions, demands and threats of the parties prior to that time are not to be controlling.[4] Such responses are to be anticipated in the effort to reach agreement before the expiration deadline. What is of concern is which party is responsible for causing the work stoppage once it is evident that the expiration date has been reached and a new agreement has not been signed. The demand for retroactive benefits was prior to that point and thus is of no moment in the analysis.
The reasoning for this view is that the parties are entitled to use all legitimate pressures they can bring to bear during the negotiations. However, in determining the workers' right to unemployment benefits, entitlement must turn on the actual conduct of the respective sides and not upon the rhetoric of the negotiations.
The testimony reveals a policy decision on the part of management to exclude the Millwrights and Ironworkers if no contract was signed.[5] A directive to that effect went to *615 the guards manning the construction site entrance gates. On the other hand no evidence was presented which showed any directive from the unions' leaders to membership instructing them not to report. In fact the testimony of the business agent for the Iron workers who also acted as negotiator, shows that the workers were affirmatively told to report.[6]
*616 The evidence presented goes on to establish that members of the unions reported for work at the usual time on June 1, 1976, approached the gates to enter the project and were rebuffed by the security guards. In one instant, a union representative (Mr. Jack Doyle), who was able to gain admittance under the guise of a visitor, was tracked down and bodily removed from the premises.[7] An employee of *617 Townsend and Bottum, Inc., who was responsible for the maintenance of security at the gates corroborated the Ironworker's testimony.[8] The exclusion procedure was also explained by another security guard.[9] Finally, the Project *618 Labor Coordinator for the employer admitted that the Millwrights and Ironworkers were denied entry to the project site on June 1, 1976.
Q: I'm talking about June 1 and 2, now.
A: Yes.
Q: They were turned away, the ironworkers and millrights?
A: That's correct.
(N.T. 563)
Appellees would have us find that the failure of the Millwrights and Ironworkers to have presented, through an authorized union representative, a written offer to continue working disqualified the members from receiving benefits. In effect, this would be an attempt to require a commitment that Section 402(d) was not designed to elicit. Section 402(d) was not designed to confer a preference at the bargaining table. The evidence presented at the Board hearing showed that several representatives and members of the Millwrights and Ironworkers reported for work on the morning of June 1, 1976. The first contact between the parties following the expiration of the contract reflects that the appellants were willing to continue to work under the terms of the prior agreement and was prevented from doing so by the employer. By so doing, the appellants offered to continue working for a reasonable time under the circumstances, at the pre-existing terms and conditions of employment.
Townsend and Bottum, Inc. by directive to their security guards specifically turned away those union members and thereby failed to permit work to continue under the same conditions. The evidence overwhelmingly proves that it was the employer who first refused to maintain the status quo, and thus the work stoppage was the result of a lock-out.
Although the weight to be given the evidence and the credibility to be afforded the witnesses are within the province *619 of the Board as finder of fact, Unemployment Compensation Board of Review v. Tickle, supra; Shira v. Unemployment Compensation Board of Review, 10 Pa.Cmwlth. 457, 310 A.2d 708 (1973), such a body is not free to ignore the overwhelming evidence in favor of a contrary result not supported by the evidence. Here the Board's findings are contrary to the corroborated credible testimony and cannot be upheld. The record clearly establishes that the Millwrights and Ironworkers were locked out and their rights to benefits should not have been foreclosed.
We now turn to the remaining appellants from the Craft Unions who present a different question for our consideration. When the Craft Union reported for work on June 3, 1976, they found that the Millwrights and Ironworkers had established picket lines. Appellee asserts that the Craft Unions' failure to enter the project that day was caused by their choice to honor the picket lines. We agree that the record amply supports such a view and as a result, these appellants became "participants in the labor dispute" and thus not entitled to unemployment compensation benefits under the first proviso of Section 402(d).[10] Appellants counters with the claim that they did in fact cross the picket line only to find the gates locked. Thus it is asserted, they too were "locked-out" and fall within the exclusion of Section 402(d).
While the perimeters of honoring a picket line for purposes of Section 402(d) is one of first impression for this Court, the Commonwealth Court has decided a number of cases which dealt with the question of when it is permissible for a union not to cross a picket line and still recover benefits under Section 402(d). These decisions have held that where members of a union voluntarily choose to honor a peaceful picket line, they become participants in the labor dispute and thus ineligible for benefits. Unemployment *620 Compensation Board of Review v. Tickle, supra. Only where there is a reasonable fear of violence, based on a showing of threats of violence and force on the picket line can a choice not to cross be rewarded with unemployment compensation benefits. Wright v. Com., Unemployment Compensation Board of Review, 45 Pa.Cmwlth. 375, 405 A.2d 991 (1979); Unemployment Compensation Board of Review v. G.C. Murphy Co., 19 Pa.Cmwlth. 572, 339 A.2d 167 (1975); Unemployment Compensation Board of Review v. Tickle, supra.
Testimony was presented from the guards that were on duty that the entrance gates were never locked on the morning of June 3, 1976. The project Construction Manager told the Board that work was available on June the third, but that the "men were not crossing the picket line." Moreover, a Craft Union member stated in response to questioning, that he was able to and did enter the site to work on June 3, 1976 and, that while the gate was closed, it was not locked. It is conceded by all parties that the pickets behaved in a peaceful fashion at all times. We affirm the Commonwealth Court's interpretation of the 402(d) lock-out exception in this regard. The decision to respect the picket line of another, where there is no danger presented, is no different than the judgment to strike. In both situations the legislature has expressed an intention to deny unemployment benefits. The striker and those who stand with him are on the same footing and the legislature has determined that both should be denied benefits under Section 402(d).
Accordingly, the Commonwealth Court Order affirming the Unemployment Compensation Board of Review is reversed-in-part and affirmed-in-part. That portion of the Order denying benefits to the Millwrights and Ironworkers is reversed and the matter remanded to the Board for the entering of an award in accordance with this Opinion. That portion of the Order denying benefits to the Craft Union is affirmed.
LARSEN, J., joins in the majority opinion and files a separate concurring opinion.
*621 FLAHERTY, J., joins the opinion of the Court and also expresses his agreement with the sentiments set forth in the concurring opinion of LARSEN, J.
LARSEN, Justice, concurring.
I join with the majority opinion. However, I believe there should be an exception to the general rule rendering ineligible for unemployment compensation benefits those employes who refuse to cross a picket line. That exception should allow employes who honor the picket line of locked-out employes to collect unemployment compensation.
I believe the legislature did intend, as the majority notes, that "the striker and those who stand with him are on the same footing . . ." and that, in the situation presented herein, the "locked-out" picketers and those who stand with them should be on equal footing, i.e., both groups should be eligible for benefits. Unfortunately, the present language of section 402(d) prohibits us from reaching this conclusion and from finding the Craft Unions' members eligible for unemployment compensation. I urge the legislature to reconsider this issue.
NOTES
[1] An exception to the Erie Forge test was created in another decision handed down the same day, also authored by Justice Cohen. Hershey Estates v. Unemployment Compensation Board of Review, 400 Pa. 446, 163 A.2d 535 (1960). It was held that where the nature of the industry involved is such that "it would be almost impossible to operate adequately on a day to day basis," a last minute offer by the union to continue working under the existing terms and conditions, does not "constitute an offer to continue working for a reasonable time." Id., 400 Pa. at 450-451, 163 A.2d at 537. In that instance, an additional burden is placed on the union to make an offer which is reasonable and indicates a "sincere willingness to continue working for a reasonable time under the pre-existing terms and conditions of employment pending negotiations "prior to the technical expiration of contract." Id., 400 Pa. at 451, 163 A.2d at 537. Only when "it appears that such an offer would definitely not be acceptable by management" is that burden alleviated. Philco Corporation v. Unemployment Compensation Board of Review, 430 Pa. 101, 104, 242 A.2d 454, 456 (1968). (Emphasis added).
The industries involved in the Hershey Estates case and cited as triggering the exception consisted mostly of "service industries, i.e., hotel, laundry, department store, community inn, etc." Hershey Estates v. Unemployment Compensation Board of Review, 400 Pa. at 451, 163 A.2d at 537. The industry involved here, construction of a fossil-fuel project, does not fall within the category of "service industries" that would be impossible to operate on a day to day basis. Thus the Hershey Estate exception is inapplicable to the instant appeal.
[2] The Board made the following finding:
The union must bear legal responsibility for the work stoppage by its refusal to work under the terms and conditions of the expired labor-management agreement without the guarantee that any new agreement would be retroactive. The employer was willing to continue to provide work under the same terms and conditions of the expired agreement, but would not agree to retroactivity. The union's demand of retroactive benefits as a part of any interim agreement cannot constitute a bona fide offer to continue work under the terms and conditions of the expired agreement.
The employer did deny work to the members of the union at the expiration of the then existing labor-management agreement. However, it was the union's duty to offer to continue working for a reasonable time under the same terms and conditions of the expired agreement. The union did not meet this duty and responsibility for the work stoppage must be assessed against the union as the party which first refused to maintain the status quo. (Emphasis added.)
Appeal No. B-76-7-D-695 at 4, Appeal No. B-76-7-K-481 at 4.
[3] The Commonwealth Court opined:
Because of the demand for retroactive benefits by the Millwrights and Iron Workers, as established by the findings of fact, we must conclude that these claimants did not make a bona fide offer to continue work under the preexisting terms and conditions of employment and therefore the work stoppage here must be assessed against these claimants as the ones which first refused to maintain the status quo. (citations omitted). Borello v. Unemployment Comp. Bd. of Review, 40 Pa.Cmwlth. at 364, 397 A.2d at 476.
[4] As noted in n. 1, the exception set forth in Hershey Estates, supra, is not here applicable.
[5] This was revealed by the testimony of Townsend and Bottum's Construction Manager.
Q. But that's not necessarily the way it would come down from the home office, that's the way you have interpreted it in your own mind, is that correct?
A. No, it's come down from the home office that if we don't have a signed contract or a signed interim agreement that does not include retroactivity or in the case of master builders, a telegram telling us that they've reached tentative agreement, to go ahead and work, you don't work them.
* * * * * *
BY THE REFEREE
Q. Any other employer? Let the Referee ask you another question, I'm still trying to get this clear in my mind Mr. Butcher, let me give you a hypothetical situation and I ask you weigh it heavily before you answer. If labor union X has a contract with your company and this contract expires at midnight May 31 of the year, and there have been absolutely no negotiating sessions prior to the expiration of that contract, no negotiating sessions, the morning of June 1, 1976 all the members of this union show up at the gate, will they be allowed to enter?
A. No they will not.
(N.T. 547-548).
[6] Were any Ironworkers, who were members of yours, permitted to work on the Bruce Mansfield Project, as of June 1, 1976?
A: No.
Q: Had you given any instructions to your members, not to work on that project, as of June 1, 1976?
A: No.
* * * * * *
Q: Were you informed on June 1, 1976, of the efforts of your members to obtain entrance to the plant?
A: Yes.
Q: What did you tell them to do?
A: I told them to go down there and to go to work.
Q: Did you tell them to do the same thing on June 2?
A: Yes sir.
(N.T. 186, 188)
This procedure was also echoed by the President and Business Representative for the Millwrights.
Q: Were you on strike on June 1?
A: No, Sir.
Q: Yet you didn't have a contract?
A: No.
Q: Were you directing your men?
A: The men were instructed to report to work. There was no instructions given to any man not to report to the job sites.
Q: Now we know that you didn't have, with these various contractors, a signed agreement, correct?
A: Correct.
Q: And you didn't have a interim agreement, correct?
A: Correct.
Q: Still under those circumstances you were still willing to offer your services to these employers?
A: Definitely.
Q: After June 1, were you still sending your people back onto the job sites?
A: Correct.
Q: And were they still being refused entrance to these job sites?
A: To the best of my knowledge, yes.
(N.T. 438).
[7] Did you report to work on Tuesday, June 1st?
A: Yes sir I did.
Q: Did the other Ironworkers who you made reference to, report to work to your knowledge?
A: To the best of my knowledge, yes sir, I did not see personally all of them.
Q: How many would you say approximately?
A: Approximately, 50 to 60 men.
Q: What occurred when you came to work on Tuesday, June 1?
A: It was my next scheduled work day.
Q: Were you there to work?
A: Yes sir.
Q: Did the guard say that he has specific instructions regarding the Ironworkers?
A: Yes he did.
Q: And the instructions were as you told us?
A: Yes.
Q: Did you take any other action on Tuesday, June 1 to try to get into the plant?
A: No sir I didn't, I notified by business agent.
Q: Did you thereafter, try to get into the plant?
A: Yes sir, the following day that would be Wednesday, June 2nd, I again approached the gate guards and was refused entrance through the construction gates at that time I went down to the main gate and I signed in as a visitor and I entered the plant.
Q: They let you in as a visitor?
A: Yes sir.
Q: What happened when you got into the plant as a visitor sir?
A: I was on the plant for approximately 30 minutes and I was rounded up by the plant security and bodily taken off the job.
Q: When you say bodily taken off the job, would please describe what happened?
A: They put me in their truck and took me off the project.
(N.T. 173-174)
[8] I think you have indicated that you know as a fact that the Ironworkers and the Millwrights did not have a signed contract on June 1, 1976?
A: Right.
Q: Did you then deny access to the working area to those employees?
A: As close as we could sir.
BY THE REFEREE
Q: In any event, on June 1, 1976, you intended to deny entry to any craft union that did not have a signed contract?
A: Yes sir.
BY MR. SEGAL
Q: So your testimony would be as you could catch them, any Ironworker who appeared or any Millwright who appeared, would not be allowed to go into work?
A: Yes sir.
Q: And they were turned away, is that correct?
A: Yes sir.
(N.T. 409)
* * * * * *
Q: Who gave you the instructions to remove Mr. Boyle from the job site?
A: Mr. Don Lucas, Pennsylvania Power.
Q: What were the specific instructions?
A: He said, called me on the telephone and says "Jack Boyle, T & B Ironworkers, steward, is on the job and he says he's not authorized to be here, escort him off. I said as soon as I locate him, I will. I located him, told him he would have to leave the job. I drove him over to the main gate and he left.
(N.T. 414)
[9] In other words, instead of looking at their cards, mostly you just asked each member as they came through, "What craft do you belong to?" If they said millwright or ironworker, then what would you tell them?
A: We told them they wasn't allowed in this gate.
(N.T. 499)
[10] The provision provides in pertinent part: ". . . Provided, That this subsection shall not apply if it is shown that (1) he is not participating in, . . . the labor dispute which caused the stoppage of work, . . . ." 43 P.S. § 802(d) (emphasis added). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581392/ | 42 So. 3d 33 (2010)
Kirk Vincent MAYERS, Appellant
v.
STATE of Mississippi, Appellee.
No. 2008-KA-01722-COA.
Court of Appeals of Mississippi.
February 23, 2010.
Rehearing Denied June 22, 2010.
Certiorari Denied August 8, 2010.
*36 George T. Holmes, Jackson, attorney for appellant.
Office of the Attorney General by Laura Hogan Tedder, attorney for appellee.
Before LEE, P.J., CARLTON and MAXWELL, JJ.
LEE, P.J., for the Court:
PROCEDURAL HISTORY
¶ 1. Kirk Vincent Mayers was convicted in the Circuit Court of Rankin County of Counts I and II, aggravated assault on law enforcement officers; Count III, possession of a stolen firearm; and Count IV, possession of a firearm by a convicted felon. Mayers was sentenced to thirty years each for Counts I and II, five years for Count III, and three years for Count IV. Mayers was sentenced to two additional ten-year terms for the use of a firearm during the commission of a felony. All sentences, totaling eighty-eight years, were ordered to run consecutively in the custody of the Mississippi Department of Corrections without eligibility for parole or probation. Mayers filed a motion for a judgment notwithstanding the verdict or, in the alternative, a new trial, which was denied by the trial court.
¶ 2. Mayers now appeals his convictions and sentences, asserting the following issues: (1) the indictment charged simple rather than aggravated assault; (2) the State failed to prove that he knowingly assaulted law enforcement officers; (3) the State failed to prove that he knowingly possessed a stolen firearm; (4) the trial court erroneously refused a self-defense instruction; (5) he was entitled to a cautionary *37 instruction concerning his prior convictions; (6) Juror 18 should have been stricken for cause; (7) the State should have been required to stipulate to his prior convictions under Count IV; (8) the trial court allowed improper opinion evidence; and (9) his sentence is illegal. Finding that a portion of Mayers's sentence was in error, we remand this case for resentencing. Accordingly, we affirm in part and vacate and remand in part.
FACTS
¶ 3. Upon being questioned by an investigator with the Simpson County Sheriff's Department, Jonathan Shelly confessed to stealing several items, including a television and firearms. Shelly told authorities that he had traded the stolen items for drugs at the Crestview Apartment complex in Pearl. On the way to the apartment complex, Shelly pointed out a car and stated that the stolen items would be found in the vehicle. An officer with the Pearl Police Department was called to stop and search the car. Stolen goods were found in the car.
¶ 4. Warrants were obtained for the two apartments where Shelly allegedly traded the stolen items for drugs. The apartment doors were adjacent to each other. Two S.W.A.T. teams were assembled to execute the warrants. The S.W.A.T. teams knocked, announced their presence, and made forceful entry into the two apartments. The first apartment was secured quickly. Upon opening the door of the second apartment, gunshots came from inside. Jake Windham and Philip Arrant, officers with the Pearl Police Department and members of the Pearl S.W.A.T. team, were injured by the gunshots. Officer Windham was shot in the left knee, and Officer Arrant was shot in the right hand. Mayers was found inside lying on the kitchen floor and, subsequently, was arrested. A .22-caliber pistol, which matched the description of the stolen weapon, was found on the floor near Mayers.
DISCUSSION
I. COUNTS I AND II OF THE INDICTMENT
¶ 5. Mayers argues that his convictions under Counts I and II should be reversed and remanded or, in the alternative, that he should be resentenced on the lesser charge of simple assault on law enforcement officers because the indictment did not specifically state that Mayers used a "deadly weapon." The issue of whether an indictment is fatally defective is a question of law, which is reviewed de novo. Qualls v. State, 947 So. 2d 365, 369 (¶ 9) (Miss.Ct.App.2007).
¶ 6. Count I of the indictment states:
KIRK VINCENT MAYERS ... did unlawfully, feloniously, purposely and knowingly, cause or attempt to cause bodily injury to Officer Jake Windham, a law enforcement officer with the Pearl Police Department, by shooting the officer in the leg with a gun, knowing the officer was acting within the course and scope of his official duties in violation of Mississippi Code Annotated § 97-3-7....
(Emphasis added). Count II of the indictment states:
And, based upon a series of acts connected together and constituting parts of a common scheme and plan, KIRK VINCENT MAYERS ... did unlawfully, feloniously, purposely and knowingly, cause or attempt to cause bodily injury to Officer Phillip [sic] Arrant, a law enforcement officer with the Pearl Police Department, by shooting at the officer with a gun, knowing the officer was acting within the course and scope of his *38 official duties in violation of Mississippi Code Annotated § 97-3-7. ...
(Emphasis added). Mayers argues that the indictment is unclear because the word "gun" does not necessarily refer to a "handgun." Mayers argues that a "gun" could refer to a paint gun, staple gun, toy gun, or grease gun.
¶ 7. Uniform Rule of Circuit and County Court 7.06 states the requirements for the substance of an indictment as follows:
The indictment upon which the defendant is to be tried shall be a plain, concise and definite written statement of the essential facts constituting the offense charged and shall fully notify the defendant of the nature and cause of the accusation. Formal and technical words are not necessary in an indictment, if the offense can be substantially described without them. ...
¶ 8. The heading of Mayers's indictment states that he is being charged with aggravated assault on a law enforcement officer. Counts I and II state the statute under which he was charged. Count I states that Mayers shot Officer Windham "in the leg with a gun," and Count II states that Mayers caused or attempted to cause Officer Arrant bodily injury "by shooting at the officer with a gun." As Rule 7.06 states: "Formal and technical words are not necessary in an indictment, if the offense can be substantially described without them." We find that it is clear from the indictment that Mayers injured the two police officers with a deadly weapon. Therefore, we find that this issue is without merit.
II. KNOWING ASSAULT
¶ 9. Mayers argues that the State failed to prove an essential element of aggravated assault on a law enforcement officer because he did not knowingly shoot the law enforcement officers. Mayers asserts that he thought someone was breaking into the apartment and fired a gun toward the door in self-defense.
¶ 10. Mississippi Code Annotated section 97-3-7(2) (Supp.2009) states, in part, that:
A person is guilty of aggravated assault if he ... (b) attempts to cause or purposely or knowingly causes bodily injury to another with a deadly weapon or other means likely to produce death or serious bodily harm. ...
The statute goes on to provide for an enhanced penalty if aggravated assault is committed upon a law enforcement officer who is acting within the scope of his duty. Id.
¶ 11. In Dotson v. State, 358 So. 2d 1321, 1322 (Miss.1978), the supreme court addressed the issue of whether it is necessary for the accused to have knowledge that the individual assaulted was a police officer in order to sustain a conviction for simple assault on a law enforcement officer. In Dotson, two police officers had a search warrant to search Frederick Dotson's vehicle. Id. at 1321. One of the officers approached Dotson's car while it was stopped at a red light; walked up to Dotson's open window; and shouted, "Dotson, freeze police." Id. The officer was wearing nothing that would identify him as a police officer, and he was driving an unmarked car. Id. The officer testified that Dotson pointed a gun at him and drove off at a high rate of speed. Id. Dotson was found guilty of simple assault on a law enforcement officer. Id. However, his conviction was reversed on appeal and remanded for the jury to determine whether he knew that the man who approached his vehicle was a police officer. Id. at 1323. In its opinion, the supreme court stated:
*39 When there is no doubt of the defendant's unlawful intention, knowledge of the official capacity of the victim is invariably unnecessary; the assailant takes his victim as he finds him. But if the defendant asserts a lack of intention or wilfulness based upon ignorance of the identity of the victim and ignorance of the victim's official privilege to interfere with the defendant's person or freedom of movement, the jury must be allowed to consider the defendant's evidence tending to show that he was ignorant of the official capacity of the victim.
Id.
¶ 12. Mayers argues that he could not have known the person he shot was a law enforcement officer because he never saw him. Mayers testified that he and his girlfriend, Serfina Martin, were asleep and did not hear the officers announce their presence. He testified that he kept a pistol with him because his girlfriend's ex-boyfriend was getting out of jail soon and had made threats against Mayers. At approximately 11:51 p.m., he heard a loud noise at the door. He woke up and retrieved the gun. As he approached the front door, the door opened from the outside, and Mayers opened fire.
¶ 13. We find that the question of whether Mayers committed a knowing assault was for the jury to decide, and the jury was properly instructed on this issue. Jury instruction number seven stated that in order to find Mayers guilty, the jury must find from the evidence, beyond a reasonable doubt that:
1. [Mayers], on or about May 5, 2006, in Rankin County, Mississippi,
2. did unlawfully, purposely and knowingly cause bodily injury to Jake Windham,
3. by shooting Jake Windham in the leg with a deadly weapon, to-wit: a gun,
4. At a time when [Mayers] knew, or reasonably should have known, that the said Jake Windham was acting within the course and scope of his duties as a law enforcement officer for the Pearl Police Department. ...
Jury instruction number eight was identical except Officer Arrant's name was substituted for Officer Windham's name.
¶ 14. Archie Bennett, a narcotics detective with the Pearl Police Department, was present on the day of the shootings. Detective Bennett testified that the officers knocked on each apartment door, and the entire S.W.A.T. team repeatedly yelled: "Pearl Police. Search warrant. Open the door." Officer Mark Mooney with the Pearl Police Department also testified that he was present at the scene. Officer Mooney was in charge of breaching the doorway of the first apartment. He testified that the ten-member team yelled: "Pearl police. Search warrant. Open the door." He testified that the first apartment was secured by half of the team before the other half breached the door of the second apartment. Officer Jerry Adair testified that during the time that he and the other officers were knocking and announcing their presence, he saw people coming out of other apartments to ask what was happening.
¶ 15. Investigator Bernard Gunter, captain of investigations with the Simpson County Sheriff's Department, testified that he rode to the scene of the search and was stationed outside the vehicle, which was approximately seventy-five yards from the doorway of the apartment. He testified that he could clearly hear the S.W.A.T. team announce "Pearl Police Department" several times from his location.
¶ 16. Officer Arrant testified that all members of the team were announcing their presence as loudly as they could. Officer Arrant testified that Officer Windham *40 rammed the door four or five times with a ramming device, but it did not open. Officer Windham then tried to ram the door with his shoulder several times before trying the ramming device again. He hit the door with the ramming device one or two more times, and the door opened. Sergeant Timothy Sarret was present and testified that the team announced their presence by knocking on the door and repeatedly yelling: "Police. Search warrant." Sergeant Sarret went on to testify that as the officers tried to ram the door open, he "could actually see a figure through ... the peephole. ..." He testified that as shots came from inside the doorway, "[t]he silhouette [was] actually right in front of me[,] and [it was] actually starting to move to my left."
¶ 17. Officer Arrant testified that he and the other members of the team were wearing tactical vests with the word "Police" clearly displayed on the front, back, and sleeves. The officer closest to the door carried a shield which read "Pearl Police Department" on the front. Sergeant Farris Thompson, who was the S.W.A.T. team leader, testified that of the ten men present, eight were wearing S.W.A.T. flight suits, tactical vests, and helmets; and two were wearing regular Pearl Police Department uniforms.
¶ 18. When reviewing the legal sufficiency of the evidence, "the relevant question 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 beyond a reasonable doubt." Bush v. State, 895 So. 2d 836, 843 (¶ 16) (Miss.2005) (quoting Jackson v. Virginia, 443 U.S. 307, 319, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979)). Viewing the evidence in the light most favorable to the State, we find that the jury was presented with sufficient evidence to determine that Mayers knew or should have known that the men outside his door were police officers. Therefore, we find that this issue is without merit.
III. SCIENTER
¶ 19. Mayers argues that the State failed to prove that he knew the firearm he used in the shootings was stolen; therefore, he argues that this Court should reverse and render the jury's verdict as to Count III.
¶ 20. Mississippi Code Annotated section 97-37-35(1) (Rev.2006) states: "It is unlawful for any person knowingly or intentionally to possess, receive, retain, acquire or obtain possession or dispose of a stolen firearm or attempt to possess, receive, retain, acquire or obtain possession or dispose of a stolen firearm." "Guilty knowledge must be both alleged and proved by the State for a conviction to stand." Long v. State, 933 So. 2d 1056, 1058 (¶ 6) (Miss.Ct.App.2006). "For the State to prove guilty knowledge, it must prove that [the defendant] received the property under circumstances that would lead a reasonable person to believe that it was stolen." Id. (citing Ellett v. State, 364 So. 2d 669, 670 (Miss.1978)).
¶ 21. The jury heard the informant, Shelly, testify that he gave Mayers a .22-caliber pistol in exchange for crack cocaine. Shelly testified that Mayers knew the pistol was stolen, and Mayers was trying to sell it quickly because it was a stolen gun. Even though Mayers did not witness the theft of the gun, we find that the circumstances under which the gun was obtained would lead a reasonable juror to believe that it was stolen. Therefore, we find that this issue is without merit.
IV. SELF-DEFENSE JURY INSTRUCTION
¶ 22. Mayers next argues that it was error for the trial court to refuse his *41 proposed jury instruction on self-defense as a defense to the charge of being a felon in possession of a firearm.
¶ 23. "When a trial court fails to give a jury instruction, this Court must review the jury instructions as a whole to determine whether reversible error was committed." Lenard v. State, 828 So. 2d 232, 236 (¶ 21) (Miss.Ct.App.2002). "[T]he court may refuse an instruction which incorrectly states the law, is covered fairly elsewhere in the instructions, or is without foundation in the evidence." Id. (quoting Heidel v. State, 587 So. 2d 835, 842 (Miss. 1991)).
¶ 24. Proposed jury instruction D-11 states:
If you find from the evidence in this case beyond a reasonable doubt that:
1. The defendant, Kirk Mayers, has been previously convicted of a felony; and
2. The defendant had in his possession a pistol;
3. Not in necessary self-defense;
then you shall find the defendant guilty of possession of a firearm by a convicted felon.
¶ 25. This Court has held that "self-defense is not a viable defense to possession of a firearm by a convicted felon. Possession of a firearm by a convicted felon is a criminal act void of a third party to defend against." Williams v. State, 953 So. 2d 260, 263 (¶ 8) (Miss.Ct. App.2006). However, "necessity is a valid defense to possession of a firearm by a convicted felon." Id. at (¶ 9). "In order to be entitled to a defense of necessity, the defendant must prove the following: (1) the act charged was done to prevent a significant evil[;] (2) there was no adequate alternative[;] and (3) the harm caused was not disproportionate to the harm avoided." Id. at 263-64 (¶ 9).
¶ 26. We find that the jury instruction, as requested, incorrectly states the law and was properly refused. We also find that if the requested instruction had been a defense of necessity, the instruction would have been without foundation in the evidence. Therefore, we find that this issue is without merit.
V. CAUTIONARY INSTRUCTION
¶ 27. Mayers argues that the trial court erred in failing to grant his requested cautionary jury instruction regarding possession of a firearm by a convicted felon. Proposed jury instruction D-8 stated:
The Court instructs the [j]ury that any prior convictions of Kirk Mayers are not evidence that the defendant committed the crime alleged in the indictment. A prior conviction is merely one element of the crime charged in the indictment. You only use that evidence, if any, in determining whether the [S]tate has met their burden of proof that Kirk Mayers is a convicted felon. You should not consider this element as evidence that Kirk Mayers possessed the firearm in question.
¶ 28. The trial court possesses considerable discretion in determining whether to grant or deny jury instructions. Bickham v. Grant, 861 So. 2d 299, 301 (¶ 8) (Miss. 2003). The trial court refused this instruction, as written, on the grounds that it was confusing and not a correct statement of the law. We find that the trial judge did not abuse his discretion in making this determination. Instead of simply being a cautionary instruction, instruction D-8 goes on to state that the jury "should not consider this element as evidence that Kirk Mayers possessed the firearm in question." Mayers did not deny possession of the firearm; therefore, this was not *42 an issue for the jury to decide. The supreme court has held that "it would be error to grant an instruction which is likely to mislead or confuse the jury as to the principles of law applicable to the facts in evidence." Id. (quoting Southland Enterprises, Inc. v. Newton County, 838 So. 2d 286, 289 (¶ 9) (Miss.2003)). Since this instruction would have misled or confused the jury, we find that Mayers's argument on appeal is without merit.
VI. FOR CAUSE DETERMINATION
¶ 29. Mayers argues that Juror 18, Charles Tucker, should have been stricken for cause because he said he had work-related matters which would distract him from focusing on Mayers's case. Mayers exhausted all of his peremptory challenges, and Tucker was placed on the jury.
¶ 30. "Excusing jurors for cause is in the complete discretion of the trial court." Berry v. State, 703 So. 2d 269, 292 (¶ 85) (Miss.1997). Other than stating that he would have a difficult time paying attention because of work-related matters, Tucker did not otherwise indicate any bias or prejudice or any other reason why he should not be on the jury. When Mayers's attorney brought Tucker's statement to the court's attention, the trial judge replied that he had asked the potential jurors the same questions the previous day when the grand jury convened, and Tucker did not respond. The trial judge stated: "He should have told me. He's going to have to endure it. He had every opportunity to tell me that Monday."
¶ 31. A presumption exists that the trial court impaneled a fair and impartial jury. Ross v. State, 954 So. 2d 968, 988 (¶ 31) (Miss.2007). "To overcome this presumption, a party must present evidence indicating that the jury was not fair and impartial and show that prejudice resulted from the circuit court's handling of the voir dire." Id. Mayers has not argued that any prejudice resulted from the impaneling of Juror 18. Therefore, we find that this issue is without merit.
VII. PRIOR CONVICTIONS
¶ 32. Mayers argues that any probative value of introducing his prior convictions was outweighed by the prejudice it caused. Mayers offered to stipulate to the existence of his prior felony convictions in order to avoid potential prejudice by the jury.
¶ 33. Mayers was previously convicted of house burglary and auto burglary. At the time of the shootings, Mayers was on probation with thirteen years to serve if his probation was revoked. The State admitted that it would have accepted the stipulation if it was only trying to prove that Mayers was a felon in possession of a firearm. However, the State argues that the introduction of the prior convictions was necessary to show motive. The State argues that Mayers shot at the officers because he knew there were stolen goods inside the apartment, and if the police entered, his probation would be revoked.
¶ 34. Mississippi Rule of Evidence 404(b) states:
Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show that he acted in conformity therewith. It may, however, be admissible for other purposes such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident.
¶ 35. The trial court found it necessary to introduce Mayers's prior judgment of conviction and sentencing order because it was part of the State's theory of the case to show motive for the aggravated assault *43 on the law enforcement officers. The documents showed the terms of Mayers's sentence and the reasons why his probation could be revoked. The trial court determined that the probative value of the prior convictions outweighed any prejudicial effect.
¶ 36. In Sawyer v. State, 2 So. 3d 655, 656 (¶ 1) (Miss.Ct.App.2008), Charlie Sawyer was charged with armed robbery and possession of a firearm by a convicted felon. The State sought to introduce two prior convictions of armed robbery to establish that Sawyer was a felon. Id. at 658 (¶ 13). Sawyer offered to stipulate his status as a convicted felon. Id. The trial court denied Sawyer's request and allowed evidence of the prior convictions to be introduced into evidence. Id. On appeal, this Court reversed and remanded, finding that "the probative value of Sawyer's prior armed robbery convictions [was] substantially outweighed by the danger of unfair prejudice because the jury would use Sawyer's prior convictions as evidence in considering [the charge of armed robbery]." Id. at 661 (¶ 28). We found that the facts of Sawyer were identical to those in Old Chief v. United States, 519 U.S. 172, 117 S. Ct. 644, 136 L. Ed. 2d 574 (1997), where the United States Supreme Court found that the risk of prejudice was too great when "the prior conviction is for an offense likely to support conviction on some improper ground. ..." Id. at 659 (¶ 20) (quoting Old Chief, 519 U.S. at 191, 117 S. Ct. 644). This Court also noted that a stipulation would have been sufficient because the State did not offer the prior convictions as an exception under Rule 404(b). Id. at 660 (¶ 27).
¶ 37. We review the trial court's "rulings on the admission or exclusion of evidence for abuse of discretion." Williams v. State, 960 So. 2d 506, 510 (¶ 11) (Miss.Ct. App.2006). We cannot find that the trial court abused its discretion in allowing evidence of the prior convictions. First, this case is distinguishable from Sawyer because the prior felonies were introduced to show the State's theory of motive. Second, the introduction of the sentencing report was necessary to show the terms of Mayers's probation. Finally, we find that the introduction of Mayers's prior convictions was not unduly prejudicial because the prior convictions were not being used to show Mayers's character or that he acted in conformity with a previous crime, as the charges of burglary are distinct from the charges of aggravated assault. This issue is without merit.
VIII. OPINION EVIDENCE
¶ 38. Mayers argues that Brian Ellis, an investigator with the Pearl Police Department, was allowed to give improper opinion evidence regarding the trajectory of the bullets fired by Mayers's gun.
¶ 39. Ellis was not qualified by the trial court as an expert. Ellis testified as to what he observed when he investigated the crime scene. Ellis testified that he found four shell casings in the living room. He found a bullet fragment lodged in an entertainment center in the apartment directly across from the apartment Mayers occupied. Ellis testified that the doors of the two apartments were directly across from one another. Ellis identified a picture of the apartment door with a bullet hole in it.
¶ 40. Mississippi Rule of Evidence 701 states that a lay person's testimony is limited to "opinions or inferences which are (a) rationally based on the perception of the witness, (b) helpful to the clear understanding of the testimony or the determination of a fact in issue, and (c) not based on scientific, technical, or other specialized knowledge within the scope of Rule 702."
*44 ¶ 41. Mayers argues that Ellis's testimony as to the path of the bullets was an area requiring expert testimony because ballistics investigation is within the scope of Mississippi Rule of Evidence 702. Ellis's testimony was nothing more than his opinion based on his personal observations. We find that Ellis's testimony was not intended to prove any ballistic evidence since Mayers admitted to shooting the officers. Therefore, we find that this issue is without merit.
IX. LEGALITY OF SENTENCE
¶ 42. Mayers argues that his sentence was illegal for five reasons that we will address separately. Finding that Mayers's argument regarding the application of Mississippi Code Annotated section 97-37-37(2) (Supp.2009) has merit, we will discuss it first. All other issues raised are without merit.
A. Ex Post Facto Application of Section 97-37-37(2)
¶ 43. Mayers argues that his sentence violated the prohibition against ex post facto application of criminal penalties. Mayers notes that Mississippi Code Annotated section 97-37-37(2) became effective on July 1, 2007, and the crime at issue was committed on May 5, 2006.
¶ 44. Mayers was sentenced to thirty years on each count of aggravated assault. The trial court then used section 97-37-37(2) to add an additional ten years to each of the aggravated assault sentences. Section 97-37-37(2) states:
Except to the extent that a greater minimum sentence is otherwise provided by any other provision of law, any convicted felon who uses or displays a firearm during the commission of any felony shall, in addition to the punishment provided for such felony, be sentenced to an additional term of imprisonment in the custody of the Department of Corrections of ten (10) years, to run consecutively, not concurrently, which sentence shall not be reduced or suspended.
¶ 45. We find that Mayers failed to raise a constitutional challenge at trial and, therefore, waived this issue. Rogers v. State, 928 So. 2d 831, 834 (¶ 8) (Miss.2006). Mayers's attorney objected to the application of section 97-37-37 on the basis of notice, but no argument is made regarding its ex post facto application. The supreme court "has consistently held that constitutional questions not raised at the lower court will not be reviewed on appeal." Id. Therefore, we find that Mayers is procedurally barred from raising this issue on appeal. Porter v. State, 749 So. 2d 250, 259 (¶ 34) (Miss.Ct.App.1999).
¶ 46. Notwithstanding the procedural bar, we may address this issue under the plain-error doctrine because it affects Mayers's substantive rights. Id. at 260-61 (¶ 36). "Article 3, section 16 of the Mississippi Constitution of 1890 prohibits those laws which retroactively change the definition of crimes or increase the punishment for criminal offenses." Id. at 260 (¶ 35). We agree with Mayers that his substantive rights were violated by the ex post facto application of section 97-37-37(2). We find this case analogous to Porter. In Porter, Robert Porter, Jr., was convicted of felony driving under the influence (DUI). Porter, 749 So.2d at 252 (¶ 2). Porter received an enhanced penalty based on the fact that he had two or more DUI convictions within the past ten years. Id. at 260 (¶ 34). However, this Court found the statute that was in effect at the time of the incident only allowed the enhanced penalty to be applied if two or more DUI offenses occurred within five years of the current offense. Id. Therefore, Porter's offense was a misdemeanor rather than a felony. Id. at (¶ 35). This Court reversed the case based on the plain-error doctrine *45 and remanded for resentencing pursuant to the statute that was in effect at the time of Porter's arrest. Id. at 261 (¶ 39).
¶ 47. We find that the error in Mayers's sentencing constituted plain error because section 97-37-37(2) did not become effective until after the crime occurred. Instead, Mississippi Code Annotated section 97-37-37(1) (Supp.2009), which first became effective on July 1, 2004, was in effect at the time of the crime and was applicable to Mayers's sentencing. Section 97-37-37(1) states:
Except to the extent that a greater minimum sentence is otherwise provided by any other provision of law, any person who uses or displays a firearm during the commission of any felony shall, in addition to the punishment provided for such felony, be sentenced to an additional term of imprisonment in the custody of the Department of Corrections of five (5) years, which sentence shall not be reduced or suspended.
Therefore, because the statute under which Mayers was sentenced was not in effect at the time his crime was committed, we vacate the two ten-year sentences ordered as sentence enhancements to the sentences for Counts I and II, and we remand this case for the limited purpose of resentencing on the sentence enhancements in Counts I and II.
B. Sentence Enhancement
¶ 48. Mayers argues that the statute under which his sentences for aggravated assault were enhanced does not apply. We will not address this issue as we have found that section 97-37-37(2) was not applicable to Mayers's sentence. However, to the extent that Mayers argues that the trial court erred in applying the sentence enhancement more than once, we find that there is no prohibition on multiple applications of this statute. This issue is without merit.
C. Double Jeopardy
¶ 49. Mayers next argues that the application of Mississippi Code Annotated section 97-37-37 constitutes double jeopardy because it requires proof of the same elements as the underlying crimes. See Houston v. State, 887 So. 2d 808, 814 (¶ 23) (Miss.Ct.App.2004) ("Double jeopardy allows a defendant to be protected against ... multiple punishments for the same offense."). Mayers argues that the "use" of a firearm element was contained in the aggravated assault offenses; thus, no additional proof was necessary under section 97-37-37. We will address this issue even though subsection (2) was incorrectly applied because "use" or "display" of a firearm is required by both subsections (1) and (2).
¶ 50. Mayers admits that sentence enhancements do not typically trigger double jeopardy violations; however, Mayers argues that it is not clear whether the statute creates a new offense or operates as an enhancement. We find that this argument is procedurally barred because it was not raised at trial. Notwithstanding the procedural bar, we find that this argument is without merit. Section 97-37-37, which is entitled: "Enhanced penalty for use of firearm during commission of felony," is clearly a sentence enhancement and does not set out separate elements of the underlying felony. We find that this issue is without merit.
D. Apprendi
¶ 51. Next, Mayers argues that the sentence enhancement was not in the indictment and that the jury did not make findings as required by Apprendi v. New Jersey, 530 U.S. 466, 120 S. Ct. 2348, 147 L. Ed. 2d 435 (2000). Apprendi states that "[o]ther than the fact of a prior conviction, *46 any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt." Id. at 490, 120 S. Ct. 2348. Mayers argues that his case is analogous to Brown v. State, 995 So. 2d 698 (Miss.2008), which was decided after he was convicted and sentenced. In Brown, Jureka Brown's sentence for the sale of cocaine was doubled because the offense occurred within 1,500 feet of a church. Id. at 701 (¶ 6). On appeal, the supreme court vacated the sentence enhancement because the trial judge, rather than the jury, decided whether Brown was within 1,500 feet of a church. Id. at 704 (¶ 27). Citing Apprendi, the supreme court found that "the Sixth Amendment requires that the issue of Brown's sentence enhancement be submitted to a jury." Id. at 705 (¶ 29). The supreme court noted that the testimony was unclear on Brown's distance from the church or whether the building was even an operating church. Id. at 704 (¶ 26).
¶ 52. Despite making this argument, Mayers does not cite to any specific element of the statute that was not decided by the jury. Brown is distinguishable from the case at hand because the jury, rather than the trial judge, decided all the elements of the sentence enhancement. The jury found beyond a reasonable doubt that Mayers was a convicted felon and that Mayers used a firearm during the commission of a felony. Each factor of section 97-37-37 is contained in the indictment and was submitted to the jury. No other factors were required to be determined by section 97-37-37 that had not already been decided by the jury. Therefore, we find that this issue is without merit.
E. Proportionality of Sentence to Crime
¶ 53. Finally, Mayers argues that his sentence was unconstitutionally disproportionate to the crimes charged. As a general rule, a sentence that does not exceed the maximum period allowed by statute will not be disturbed on appeal. Wallace v. State, 607 So. 2d 1184, 1188 (Miss.1992). However, a sentence that is "grossly disproportionate" to the crime committed is subject to attack on Eighth Amendment grounds. Id.
¶ 54. "[A]s the Mississippi Supreme Court has said on countless occasions, `[s]o long as the sentence imposed is within the statutory limits, sentencing is generally a matter of trial court discretion.'" Williams v. State, 784 So. 2d 230, 237 (¶ 19) (Miss.Ct.App.2000) (quoting Green v. State, 631 So. 2d 167, 176 (Miss.1994)). The gravity of the offense in this case was very high, and we find that the sentence imposed was not unduly harsh. Mayers states that "the gravity of the offense was moderately high, but the sentence was extreme and greater than sentences imposed in the same jurisdiction and others." However, Mayers does not cite to any case law to provide examples of similarly-situated defendants who received lesser sentences.
¶ 55. Since we find that a threshold comparison reveals that Mayers's sentence was not grossly disproportionate, no constitutional analysis is necessary under Hoops v. State, 681 So. 2d 521, 538 (Miss. 1996). See also Solem v. Helm, 463 U.S. 277, 292, 103 S. Ct. 3001, 77 L. Ed. 2d 637 (1983) (overruled in part by Harmelin v. Michigan, 501 U.S. 957, 965-66, 111 S. Ct. 2680, 115 L. Ed. 2d 836 (1991)). Therefore, we find that this issue is without merit.
CONCLUSION
¶ 56. We find that Mayers was erroneously sentenced pursuant to section 97-37-37(2), which was not in effect at the time his crime was committed. Mayers should have been sentenced pursuant to section 97-37-37(1), which became effective *47 on July 1, 2004. Section 97-37-37(1) requires a sentence enhancement of five years for each count of aggravated assault because Mayers used a firearm during the commission of the felonies. The sentence enhancement under Counts I and II is vacated, and this case is remanded for resentencing pursuant to the law in effect at the time of Mayers's crime. We find that all other issues raised in this appeal are without merit.
¶ 57. THE JUDGMENT OF THE CIRCUIT COURT OF RANKIN COUNTY OF CONVICTION OF COUNT I, AGGRAVATED ASSAULT UPON A LAW ENFORCEMENT OFFICER, AND SENTENCE OF THIRTY YEARS; COUNT II, AGGRAVATED ASSAULT UPON A LAW ENFORCEMENT OFFICER, AND SENTENCE OF THIRTY YEARS; COUNT III, POSSESSION OF A STOLEN FIREARM, AND SENTENCE OF FIVE YEARS; AND COUNT IV, POSSESSION OF A FIREARM BY A CONVICTED FELON, AND SENTENCE OF THREE YEARS, WITH THE SENTENCES TO RUN CONSECUTIVELY IN THE CUSTODY OF THE MISSISSIPPI DEPARTMENT OF CORRECTIONS WITHOUT ELIGIBILITY FOR PAROLE OR PROBATION, IS AFFIRMED. THE SENTENCE ENHANCEMENTS FOR COUNTS I AND II ARE VACATED, AND THIS CASE IS REMANDED FOR THE LIMITED PURPOSE OF RESENTENCING CONSISTENT WITH THIS OPINION. ALL COSTS OF THIS APPEAL ARE ASSESSED TO RANKIN COUNTY.
KING, C.J., MYERS, P.J., GRIFFIS, BARNES, ISHEE, ROBERTS AND CARLTON, JJ., CONCUR. MAXWELL, J., SPECIALLY CONCURS WITH SEPARATE WRITTEN OPINION JOINED BY BARNES AND ROBERTS, JJ. IRVING, J., NOT PARTICIPATING.
MAXWELL, J., specially concurring:
¶ 58. I agree with the result reached by the majority. However, I write separately to address a matter that has not yet been confronted by Mississippi's appellate courts application of the firearm penalties set forth in Mississippi Code Annotated section 97-37-37 (Supp.2009). Section 97-37-37(1) provides:
Except to the extent that a greater minimum sentence is otherwise provided by any other provision of law, any person who uses or displays a firearm during the commission of any felony shall, in addition to the punishment provided for such felony, be sentenced to an additional term of imprisonment in the custody of the Department of Corrections of five (5) years, which sentence shall not be reduced or suspended.
If the firearm is used or displayed by a previously convicted felon, a mandatory ten-year consecutive sentence applies. See Miss.Code Ann. § 97-37-37(2).
¶ 59. In Apprendi v. New Jersey, 530 U.S. 466, 490, 120 S. Ct. 2348, 147 L. Ed. 2d 435 (2000), the United States Supreme Court instructed: "Other than the fact of a prior conviction, any fact that increases the penalty for a crime beyond the prescribed statutory maximum must be submitted to a jury, and proved beyond a reasonable doubt." In the case before us, the circuit judge increased Mayers's sentence "beyond the prescribed statutory maximum" of thirty years' imprisonment on each of the two aggravated assault counts. Thus, Apprendi's dictates were clearly triggered.
¶ 60. I agree with the majority that by returning guilty verdicts on the substantive aggravated-assault and firearm-possession *48 counts, the jury made the necessary factual findings that Mayers used or displayed a firearm in the commission of another crime as required by section 97-37-37.
¶ 61. Though Mississippi courts have not addressed this specific issue, Florida courts have held where an indictment alleges "the crime was committed with a firearm and the jury finds that the defendant committed the crime as charged, the jury has necessarily found use of a firearm." Hunter v. State, 828 So. 2d 1038, 1039 (Fla.Dist.Ct.App.2002) (citing State v. Hargrove, 694 So. 2d 729, 731 (Fla.1997), abrogated on other grounds by Galindez v. State, 955 So. 2d 517, 522-23 (Fla.2007)). Other states have similarly reasoned that such findings satisfy the Apprendi requirement that the element of use of a firearm was charged, submitted to a jury, and proved beyond a reasonable doubt. See People v. Rhodes, 281 A.D.2d 225, 227-28, 723 N.Y.S.2d 2 (N.Y.App.Div.2001); Clark v. State, 621 N.W.2d 576, 581-82 (N.D. 2001); Parker v. State, 754 N.E.2d 614, 618-19 (Ind.Ct.App.2001); State v. McLean, 344 N.J.Super. 61, 779 A.2d 1128, 1129, 1134-35 (2001); State v. Walker, 789 So. 2d 86, 90-91 (La.Ct.App.2001).
¶ 62. However, situations arise where firearms are employed during the commission of a felony, but their use or display are not required elements of the charged predicate offense. For example, if a firearm is employed during a sexual battery, simply proving each element of the sexual-battery charge would not cover the necessary elements of use or display of a firearm. And in such instances, unless the circuit judge sentences the defendant well below the statutory maximum, Apprendi would prohibit the additional five and ten-year sentences provided in section 97-37-37(1) and (2).
¶ 63. In situations where the predicate offense does not contain the elements of use or display of a firearm, there are essentially two ways to trigger the enhanced penalties in 97-37-37(1) and (2). The first method is for prosecutors to charge section 97-37-37 in the indictment. Indeed, Title 18, Section 924(c)(1)(A) of the United States Code (Supp.2009) the federal firearm counterpart, which Mississippi's enhanced penalties in section 97-37-37 appear to have been modeled after has since its inception been charged and presented to the jury in connection with the underlying predicate felony offense. This approach clearly complies with Apprendi and creates another arrow in the prosecutor's quiver to fight felony crimes during which firearms are used or displayed. This method also provides notice to criminal defendants that they will be imprisoned for an additional five or ten years if they proceed to trial and are convicted of using or displaying a firearm.
¶ 64. A second approach entails submission of a special verdict form to the jury that requires deliberation and jury findings beyond a reasonable doubt on the separate elements of the firearm enhancement. While this second method has been approved by the Florida Supreme Court, see State v. Iseley, 944 So. 2d 227, 230-31 (Fla.2006), there are questions whether it meets the notice requirements set forth in Jones v. United States, 526 U.S. 227, 243 n. 6, 119 S. Ct. 1215, 143 L. Ed. 2d 311 (1999) (holding that the Due Process Clause and Sixth Amendment require that any fact other than a prior conviction that increases the maximum penalty for a crime must be charged in the indictment).
¶ 65. In my opinion, the first method of simply charging section 97-37-37 in the indictment would create the least confusion among the bench and bar and would meet constitutional notice and due process *49 requirements as well as the dictates of Apprendi.
BARNES AND ROBERTS, JJ., JOIN THIS OPINION. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581472/ | 957 F. Supp. 1071 (1997)
Marc BOUBONIS, Plaintiff,
v.
Shirley S. CHATER, Commissioner of Social Security, Defendant.
No. 97-C-202.
United States District Court, E.D. Wisconsin.
March 31, 1997.
Marc Boubonis, Milwaukee, WI, pro se.
Penelope C. Fleming, Asst. U.S. Atty., Office of U.S. Atty., Milwaukee, WI, for Defendant.
DECISION AND ORDER
MYRON L. GORDON, District Judge.
The plaintiff, Marc Boubonis, filed this action on February 28, 1997, seeking review of a final decision of the Commissioner of Social *1072 Security ["Commissioner"] who, Mr. Boubonis claims, denied his claims for supplemental security income benefits. Mr. Boubonis is proceeding pro se.
Accompanying the plaintiff's complaint is a petition for leave to proceed in forma pauperis. In order to authorize a litigant to proceed in forma pauperis, the court must make two determinations: first, whether the litigant is unable to pay the costs of commencing this action; and second, whether the action is frivolous or malicious. 28 U.S.C. § 1915(a) & (e)(2)(B)(i). Because the court finds that Mr. Boubonis has satisfied both prongs of this test, his petition for leave to proceed in forma pauperis will be granted.
In his affidavit of indigence, Mr. Boubonis states that he is presently employed by the "Auto Driveaway" at the approximate rate of $250 per month. He further states that he has no money in a private checking or savings account and that he owns no real estate, bonds, automobiles, or other valuable property. Moreover, Mr. Boubonis submits that he owes $15,000 in school loans, $1000 in medical bills, and miscellaneous debts of $600. I believe that Mr. Boubonis has satisfied the requirements of 28 U.S.C. § 1915(a) and is unable to pay the $150 filing fee.
Mr. Boubonis must next demonstrate that his action has merit as required by 28 U.S.C. § 1915(e)(2)(B)(i). An action is frivolous if there is no arguable basis for relief either in law or in fact. Denton v. Hernandez, 504 U.S. 25, 31, 112 S. Ct. 1728, 1732-33, 118 L. Ed. 2d 340 (1992) (quoting Neitzke v. Williams, 490 U.S. 319, 325, 109 S. Ct. 1827, 1831-32, 104 L. Ed. 2d 338 (1989)); Casteel v. Pieschek, 3 F.3d 1050, 1056 (7th Cir.1993). The court is obligated to give Mr. Boubonis' pro se allegations, however inartfully pleaded, a liberal construction. Haines v. Kerner, 404 U.S. 519, 520-21, 92 S. Ct. 594, 595-96, 30 L. Ed. 2d 652 (1972) (per curiam); Vanskike v. Peters, 974 F.2d 806, 807 (7th Cir.1992), cert. denied, 507 U.S. 928, 113 S. Ct. 1303, 122 L. Ed. 2d 692 (1993).
Mr. Boubonis has the right, under 42 U.S.C. § 405(g) to obtain review of the administrative law judge's decision. Attached to the plaintiff's complaint is a copy of a letter from the Appeals Council for the Social Security Administration to Mr. Boubonis. In the letter, an appeals officer notified Mr. Boubonis that the council was denying his request for review of the adverse decision of the Administrative Law Judge ("ALJ"). By making this denial, the Appeals Council adopted the ALJ's decision as the final decision of the Commissioner. Mr. Boubonis filed a copy of the ALJ's decision with this court on March 4, 1997.
The standard of review that the district court is to apply in reviewing the Commissioner's decision is whether the decision is supported by "substantial evidence." 42 U.S.C. § 405(g); Micus v. Bowen, 979 F.2d 602, 604 (7th Cir.1992); Ehrhart v. Secretary of Health and Human Serv., 969 F.2d 534, 538 (7th Cir.1992). Substantial evidence "means more than a mere scintilla of proof, instead requiring such relevant evidence as a reasonable mind might accept as adequate to support a conclusion" Ehrhart, 969 F.2d at 538 (citations omitted). The court, in reviewing the Commissioner's decision, may neither substitute its judgment for the Commissioner's, nor "merely rubber stamp" the Commissioner's decision. Id.
Although the plaintiff does not specifically argue in his complaint that the Commissioner's decision is not supported by substantial evidence and is contrary to law, the court finds that such an argument is implicit in Mr. Boubonis' filing of this complaint. The ALJ found that Mr. Boubonis has "severe" physical and mental impairments, and that he is unable to perform any of his past relevant work, but that the plaintiff's impairments did not meet the legal requirements for receiving supplemental security income. In his complaint before this court, the plaintiff lists several of the ALJ's findings that the plaintiff believes are wrong and that, Mr. Boubonis alleges, "turn[] a blind eye to the record."
I believe that it would be inappropriate for the court to decide at this early juncture that Mr. Boubonis' claim has no basis in either fact or law. To do so would be to find that the Commissioner's decision is supported by substantial evidence without the court's even seeing any of the evidence. *1073 Although the standard that Mr. Boubonis must meet is high, it is not impossible. I conclude that there may be a basis in law or in fact for the plaintiff's appeal of the Commissioner's decision and that Mr. Boubonis' appeal therefore may have merit, as defined by 28 U.S.C. § 1915(e)(2)(B)(i).
The United States Marshal will be directed to serve a copy of the complaint, the summons and this order upon the defendant. Mr. Boubonis, however, is reminded that he is required under Rule 5(a), Federal Rules of Civil Procedure, to serve upon the defendant, or if an appearance is entered by counsel, upon counsel, a copy of every pleading, motion or other paper he files with the court.
Also before the court is Mr. Boubonis' request for the appointment of counsel, in which he states that "[e]fforts have been made in contacting at least six lawyers, with none interested in the case," and that with "claimant's disabilities and medication schedule, proceeding without an advocate may prove undesirable to all concerned."
Whether to appoint an attorney to represent an indigent civil litigant is within the sound discretion of the district court. Jackson v. County of McLean, 953 F.2d 1070, 1071 (7th Cir.1992). The newly amended in forma pauperis statute provides that the "court may request an attorney to represent any person unable to afford counsel." 28 U.S.C. § 1915(e)(1). Among the threshold factors that a court must consider when determining whether the appoint counsel for a civil litigant are his indigency and his attempts to retain counsel. As explained above, I have already found that Mr. Boubonis is indigent for the purposes of proceeding with this action. In Jackson, however, the court of appeals for the seventh circuit elaborated on the requirement that the litigant have attempted to find his own attorney:
Yet once indigency is established, we believe that [the statute providing for appointment of an attorney] requires a threshold inquiry into the indigent's efforts to secure counsel. Accordingly, when deciding whether or not to grant a request for counsel under [the statute], the district judge must first determine if the indigent has made reasonable efforts to retain counsel and was unsuccessful or that the indigent was effectively precluded from making such efforts.
Jackson, 953 F.2d at 1072-73.
Once the plaintiff has established that he is indigent and that his reasonable efforts to obtain counsel were unsuccessful or that he was effectively precluded from making such efforts, some of the other factors that the district court may consider in exercising its discretion are the merits of the plaintiff's claim, the competency of the plaintiff to proceed without a lawyer, and the complexity of the legal issues. Jackson, 953 F.2d at 1072; Maclin v. Freake, 650 F.2d 885, 887-89 (7th Cir.1981).
Mr. Boubonis has failed to support his motion for the appointment of counsel with any proof that he has attempted to secure counsel. The court cannot, based merely upon his unsworn and unsupported assertions, find that Mr. Boubonis has met this threshold requirement for the appointment of counsel. Mr. Boubonis' application would be more helpful in assisting the court in its proper exercise of discretion if he were to submit a sworn statement identifying six attorneys he has contacted. He should also provide dates of such contact and the attorneys' responses. The plaintiff may renew this motion once he is able to show the court that he made reasonable efforts to secure counsel or that he was effectively precluded from doing so. Such motion, however, only will be considered by the court if Mr. Boubonis demonstrates that he has met the other requirements listed in Jackson.
Therefore, IT IS ORDERED that Mr. Boubonis' petition for leave to proceed in forma pauperis be and hereby is granted, pursuant to 28 U.S.C. § 1915(a) & (e)(2)(B)(i).
IT IS FURTHER ORDERED that, pursuant to 28 U.S.C. § 1915(d), the United States Marshal be and hereby is directed to serve a copy of the complaint, the summons and this order upon the defendant.
IT IS FURTHER ORDERED that Mr. Boubonis be and hereby is directed to serve *1074 upon the defendant, or defendant's counsel, all pleadings, motions or other papers filed with the court.
IT IS FURTHER ORDERED that Mr. Boubonis' motion for the appointment of counsel be and hereby is denied, without prejudice. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581455/ | 957 F. Supp. 196 (1997)
David J. OSTRACH, Plaintiff,
v.
REGENTS OF THE UNIVERSITY OF CALIFORNIA, Dennis Schimek, David Hinton, Howard Bailey, Gary Schultz, and Larry Vanderhoff, Defendants.
Civ. No. S-96-1507 LKK/GGH.
United States District Court, E.D. California.
March 17, 1997.
*197 Larry P. Schapiro, Ruiz and Schapiro, Sacramento, CA, for plaintiff.
Thomas F. Bertrand, Bertrand, Fox and Elliot, San Francisco, CA, for defendants.
ORDER
KARLTON, Chief Judge Emeritus.
On August 20, 1996, plaintiff David Ostrach filed a nineteen-page complaint alleging ten different causes of action. That complaint is before the court on defendants' motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). After oral argument, the court took the matter under submission. The motion will be addressed comprehensively in an unpublished order. Below, the court extracts its discussion of two of the causes of action for publication.[1]
I.
THE COMPLAINT
The plaintiff, a Caucasian Jewish male, is a Ph.D. candidate in Comparative Pathology. For seven years, he was employed by the School of Veterinary Medicine at UC Davis, ultimately being promoted to "Staff Research Associate IV." He was terminated from his job in September of 1995. Plaintiff alleges that he suffers from "Ehler-Danlos Syndrome," which he claims causes him difficulty with fine manual dexterity and repetitive motion. He alleges that his employer, his major professor/work supervisor, and other University of California employees[2] discharged him and discriminated against him in the terms of his employment and his rights as a student on account of his disability, race, and religion.
II.
THE AMERICANS WITH DISABILITIES ACT
Plaintiff's claim under the Americans with Disabilities Act ("ADA") appears to be asserted against all the defendants. He apparently contends that various defendants sought to remove him from working on his Ph.D. project because of his disability, and that he was discharged in retaliation for having filed a grievance asserting discrimination on the basis of his alleged disability. These claims implicate 42 U.S.C. §§ 12112(a)[3] and 12203(a).[4] I address the two provisions seriatim.
*198 A. 42 U.S.C. § 12112(a)
Plaintiff has sued various individual defendants under § 12112(a). He thus raises the question of whether anyone but the employer may be sued under this provision.
Section 12112(a) forbids discrimination by any "covered entity." The Act defines a "covered entity" as "an employer, employment agency, labor organization, or joint labor-management committee." 42 U.S.C. § 12111(2). In turn, "employer" is defined as "a person engaged in an industry affecting commerce who has 15 or more employees ... and any agent of such person...." 42 U.S.C. § 12111(5)(A). This definition tracks Title VII's definition of "employer." Compare 42 U.S.C. § 12111(5)(A) with 42 U.S.C. § 2000e(b).
The Ninth Circuit has held in Miller v. Maxwell's Intern., Inc., 991 F.2d 583 (9th Cir.1983), cert. denied sub nom. Miller v. La Rosa, 510 U.S. 1109, 114 S. Ct. 1049, 127 L. Ed. 2d 372 (1994), that liability under § 2000e-2(a)(1) does not extend to individual defendants. See also U.S. E.E.O.C. v. AIC Security Investigations, Ltd., 55 F.3d 1276, 1280 (7th Cir.1995) (finding four out of five circuits that have examined the issue under analogous provisions of Title VII and the ADEA have rejected individual liability). In Miller, the majority argued that since "Congress decided to protect small entities with limited resources from liability, it is inconceivable that Congress intended to allow civil liability to run against individual employees." Miller, 991 F.2d at 587. The majority also contended, adopting the assertion of the district court, that the "obvious purpose" of including "any agent of the employer" in the definition of "employer" in Title VII was "to incorporate respondeat superior liability into the statute." Id. To say the least, the reasoning supporting Miller's conclusion is less than convincing.
By its express language, Title VII renders both an employer and its agents expressly liable.[5] This explicit statutory language gives rise to the two separate propositions embodied in the plain meaning rule. First, is the principle that Congress means what it says, so that "the statutory language is normally the best evidence of congressional intent." Church of Scientology v. U.S. Dept. Of Justice, 612 F.2d 417, 421 (9th Cir.1979). Second, if the language of a statute is clear "there is no need to interpret the language." Id. The conclusion reached in Miller violates both aspects of the rule. The Circuit concedes that a plain meaning reading imposing liability on agents "is not without merit." Miller, 991 F.2d at 583, 587. Nonetheless, the Miller majority refuses to honor that plain meaning; instead, it interprets the statute by resort to misguided precedent and an undocumented legislative purpose, the basis of which rests primarily on unproven empirical suppositions about employer motivations. Id. at 587-88.
The reliance on supposed legislative purpose is highly suspect since there is no citation to the legislative history or any other source in support. The reason for that reticence seems plain enough. If resort to legislative history were proper relative to the statute, its examination would lend no support to the Miller construction. There simply is a paucity of legislative history dealing with supervisor liability. See Lamberson, Personal Liability for Violations of Title VII: Thirty Years of Indecision, 46 Baylor L.Rev. 419, 426-27 (1994).[6] Accordingly, Miller's assertion concerning legislative intent, divorced from both text and legislative *199 history, is most charitably described as speculative.
Nor is the absence of any basis for the Miller court's conclusion that the "obvious purpose" of the "agent" provision was to incorporate respondeat superior liability the only reason for rejecting the circuit's rationale. As I now explain, rules of construction also militate against that conclusion.
Canons of construction counsel against a finding that statutory language is surplusage. See United States v. Mehrmanesh, 689 F.2d 822, 829 (9th Cir.1982) (court may not construe statute so as to make any part of it "mere surplusage"). Adoption of Miller's conclusion, however, renders the very language it purports to construe, surplusage. By making employers liable, the statute necessarily implies the doctrine of respondeat superior. See Greer, "Who Me?" A Supervisor's Individual Liability for Discrimination, 62 Fordham Law Review, 1835, 1847 (1994); see also Tomka v. Seiler Corp., 66 F.3d 1295, 1319 (2d Cir.1995) (Parker, J., dissenting). Accordingly, Miller's construction leaves no subject upon which the statutory language might operate, i.e., it makes it surplus.
Moreover, and more importantly, the holding frustrates the declared purpose of the statute and the recent amendments making compensatory and punitive damages available to prevailing plaintiffs. Title VII incorporates a congressional declaration of a "national policy of nondiscrimination." See 110 Cong.Rec. 13, 169 (1964). In contrast to equitable remedies such as reinstatement and back pay, which are typically imposed on employers, compensatory and punitive damages are typically imposed upon the perpetrators of wrongful conduct and not necessarily on those whose liability is merely derivative. See, e.g., Meritor Savings Bank v. Vinson, 477 U.S. 57, 72, 106 S. Ct. 2399, 2408, 91 L. Ed. 2d 49 (1986) (plaintiff's co-worker's sexually harassing conduct not automatically ascribed to employer); cf. Bridges v. Eastman Kodak Co., 800 F. Supp. 1172, 1180 (S.D.N.Y.1992) ("Since such damages [compensatory and punitive damages] are of type that an individual can be expected to pay, [there is] little reason" to hold harmless individual defendants sued in their individual capacities); see also Miller, 991 F.2d at 589 (Fletcher, J., dissenting). The purpose of imposing punitive damages in particular is to punish the wrongdoer and deter others. Holding individuals harmless for their own conduct, while imposing vicarious liability upon the organizations that employ those individuals, clearly frustrates at least one and probably both of the statute's purposes. See Hamilton v. Rodgers, 791 F.2d 439, 443 (5th Cir.1986) (refusing to hold perpetrators liable "encourage[s] supervisory personnel to believe that they may violate Title VII with impunity.").
It is no answer to say, as Miller does, see 991 F.2d at 588, that employer liability will sufficiently motivate them so as to disabuse their supervisors of the notion that discrimination has no personal consequences. If employers have no advance notice of their supervisors' conduct, their response must be after the fact, thus frustrating the statutory purpose of preventing the discriminatory conduct.[7]
In any event, under Miller's construction the perpetrators escape any consequences under the statute for their own conduct. In contrast to Miller's speculation concerning employer motivation, imposing liability on the perpetrators of prohibited conduct creates a direct way of discouraging discriminatory conduct. See Iacampo v. Hasbro, Inc., 929 F. Supp. 562, 572 (D.R.I.1996) ("[T]hreatening supervisory employees with individual liability under Title VII and the ADA deters those who would use their positions and power to discriminate, and guarantees that victims of discrimination will receive redress ... from their very present oppressors.").
Given the plain terms of the statute, the absence of legislative history to support the conclusion of the Miller court, and its frustration of legislative purpose, the decision seems to rest on nothing more than a policy determination that since supervisors are ordinarily *200 less able than "employers" to bear the burdens of litigation, they should not be held liable for their own discriminatory conduct under Title VII. But when "Congress' intent is ... plain ... policy arguments ... must be addressed to the body that has the authority to amend the legislation, rather than one whose authority is limited to interpreting it." Laborers Health and Welfare Trust Fund for No. Cal. v. Advanced Lightweight Concrete Co., Inc, 484 U.S. 539, 551, 108 S. Ct. 830, 837, 98 L. Ed. 2d 936 (1988).
For all the above reasons, this court is convinced that Miller was wrongly decided, and I can only hope that an en banc court corrects the error. Nonetheless, as I have previously explained, "[h]aving noted my disagreement with both the principle and its rationale, it goes without saying that this court is bound by the Circuit's ruling and must apply it." Coleman v. Wilson, 912 F. Supp. 1282, 1299 n. 11 (E.D.Cal.1995), appeal dismissed, 101 F.3d 705 (9th Cir.1996). Accordingly, constrained by the Circuit's holding in Miller and the fact that § 12112(a) tracks the language of 42 U.S.C. § 2000e, the court will not grant plaintiff leave to sue the individual defendants for their alleged violation of his rights under 42 U.S.C. § 12112(a).
B. 42 U.S.C. § 12203
Plaintiff's retaliatory discharge claim presents a different question. Neither the Supreme Court nor the Ninth Circuit has addressed the question of individual liability under § 12203.[8] As there is no binding precedent, the issue becomes a matter of statutory construction, the purpose of which is to determine and effectuate Congress' intent. Foxgord v. Hischemoeller, 820 F.2d 1030, 1032 (9th Cir.1987) (citing United States v. Taylor, 802 F.2d 1108, 1113 (9th Cir.1986), cert. denied, 479 U.S. 1094, 107 S. Ct. 1309, 94 L. Ed. 2d 164 (1987)), cert. denied, 484 U.S. 986, 108 S. Ct. 503, 98 L. Ed. 2d 502 (1987).
The process of determining congressional intent begins with the language of the statute itself. Landreth Timber Co. v. Landreth, 471 U.S. 681, 685, 105 S. Ct. 2297, 2301, 85 L. Ed. 2d 692 (1985); Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164, 172-74, 114 S. Ct. 1439, 1446, 128 L. Ed. 2d 119 (1994). Unlike § 12112 which refers to the liability of an "employer," the retaliation provision directs that "no person shall discriminate against any individual...." See note 4, supra (emphasis added). Since the plain meaning of "person" includes individuals, and since I "must presume that a legislature says in a statute what it means and means in a statute what it says there," Connecticut National Bank v. Germain, 503 U.S. 249, 253-54, 112 S. Ct. 1146, 1149, 117 L. Ed. 2d 391 (1992), it follows that plaintiff may sue the individual defendants under the anti-retaliation provision of the ADA. That, however, does not conclude the analysis.
Because plaintiff seeks general damages, the court must also determine whether the retaliation provisions of the statute permit their recovery. The statute, in addressing procedures and remedies, commences by referring to other statutes, see 42 U.S.C. § 12203; those statutes in turn refer to other statutes, which in turn refer to yet other statutes. Without replicating in detail the veritable labyrinth that must be traced in an effort to determine what remedies are available, it appears that this referral and rereferral process leads to only two statutes addressing remedies, 42 U.S.C. §§ 2000e-5(g) and 2000a-3(a), both providing only equitable relief.[9] Nonetheless, as I now explain, it also appears to the court that Congress has provided for the recovery of both general and punitive damages for a willful violation of the anti-retaliation provisions of the ADA.
The statute extends to aggrieved plaintiffs the remedies available pursuant to sections *201 107, 203 and 308 of the Act. 42 U.S.C. § 12203(c); see note 4, supra. In turn, Congress has provided that "[i]n an action brought by a complaining party under the powers, remedies and procedures set forth in § 716 or 717 of the Civil Rights Act of 1964 (as provided in section 107(a) of the Americans with Disabilities Act of 1990) against a respondent who engaged in unlawful intentional discrimination ... the complaining party may recover compensatory and punitive damages...." 42 U.S.C. § 1981a(2). In turn, "complaining party" is defined by the Civil Rights Act of 1991 to include persons who bring actions under Title I of the Americans with Disabilities Act, see 42 U.S.C. § 1981a(d)(1)(B), and thus would appear to include suits charging retaliation.[10]
The above statutory analysis, as complex and circular as any this court has previously encountered, suggests that plaintiff may seek full recovery. This conclusion is buttressed by the established principle that "where legal rights have been invaded, and a federal statute provides for a general right to sue for such invasion, federal courts may use any available remedy to make good the wrong done." Bell v. Hood, 327 U.S. 678, 684, 66 S. Ct. 773, 777, 90 L. Ed. 939 (1946). As the Supreme Court has recently explained, where Congress provides a cause of action, a federal court must "presume the availability of all appropriate remedies unless Congress has expressly indicated otherwise." Franklin v. Gwinnett County Public Schools, 503 U.S. 60, 66, 112 S. Ct. 1028, 1032, 117 L. Ed. 2d 208 (1992). Indeed, Franklin has led one district court to conclude that general damages are available under the ADA's antiretaliation provisions. See Niece v. Fitzner, 922 F. Supp. 1208, 1219 (E.D.Mich.1996).[11] For all the above reasons, the court determines that plaintiff here can seek general damages under the retaliation provision of the ADA.
III.
CONCLUSION
For the above reasons, the court concludes that plaintiff's suit against the individuals whom he alleges discriminated against him by virtue of his disability must be dismissed without leave to amend, but that he may maintain a suit against them for, inter alia, punitive and compensatory damages allegedly suffered by virtue of their retaliation against him because he complained of their discrimination. This dissonant result flows inexorably from the Circuit's failure in Miller to carefully attend to the language the Congress employed in Title VII and the necessary application of that holding to the parallel language in the Americans with Disabilities Act.
IT IS SO ORDERED.
NOTES
[1] This court has long engaged in the practice of publishing only limited portions of its opinions. My reasons for doing so were first explained in Kouba v. Allstate Insurance Co., 523 F. Supp. 148, 151 n. 2 (E.D.Cal.1981), rev'd on other grounds, 691 F.2d 873 (9th Cir.1982).
[2] Plaintiff named the following defendants in this action: the Regents of the University of California ("UC Regents"); David Hinton (plaintiff's work supervisor and major professor); Dennis Schimek (Associate Vice Chancellor for Human Resources at University of California, Davis ("UC Davis")); Gary Schultz (Assistant Dean of Administration at UC Davis School of Veterinary Medicine); Larry Vanderhoef (Chancellor of UC Davis); and Howard Bailey (a supervisory employee of UC Regents and Hinton). Defendant Bailey was never served and was subsequently dismissed at a Status Conference held on December 2, 1996.
[3] Section 12112(a) provides:
General rule
No covered entity shall discriminate against a qualified individual with a disability because of the disability of such individual in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.
42 U.S.C. § 12112(a).
[4] Section 12203 of the Americans with Disabilities Act provides:
(a) Retaliation No person shall discriminate against any individual because such individual has opposed any act or practice made unlawful by this Act or because such individual made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under this Act.
* * * * * *
(c) Remedies and Procedures The remedies and procedures available under sections 107, 203, and 308 of this Act shall be available to aggrieved persons for violations of subsections (a) and (b), with respect to title I, title II and title III, respectively.
42 U.S.C. § 12203(a) & (c).
[5] As I explain in the text, not only does the statutory language clearly create individual liability, any contrary reading violates established canons of statutory construction.
[6] Moreover, the scant legislative history which exists suggests that Congress created the minimum employee threshold, not to protect individual employees, but to justify jurisdiction for the Act under the Commerce Clause. See Tomka v. Seiler Corp., 66 F.3d 1295, 1322 (2d Cir.1995) (Parker, J., dissenting) (citing 110 Cong.Rec. 6566, 6548, 7052, 7054, 7088 & 7207-12). As Judge Parker notes, even when Congress debated Title VII's impact upon small businesses, the debate focused on the personal nature of small businesses; there was never a suggestion, either during the 1964 debates or in the 1991 Amendments, that ordinary civil remedies should not be available against individual supervisors who are directly responsible for discrimination. Id. at 1322-1323; see also Lamberson, Personal Liability for Violations of Title VII: Thirty Years of Indecision, 46 Baylor L.Rev. 419, 426-27 (1994).
[7] Obviously, if employers are aware of the conduct and have not acted upon it, Miller's assumption also fails.
[8] As far as the court can determine, no other circuit court has directly confronted the issue either.
[9] Without complete confidence that the following list encompasses all of the statutes referred to, and all the permutations to be followed, the court believes that the following statutes are implicated: 42 U.S.C. §§ 12203, 12111, 12117, 2000-4, 5, 6, 8, 9, 12131, 12133, 2000e-16, 5(f)(e), 12181, 12188, 2000a-3(a) and 29 U.S.C. § 794a.
[10] While the retaliation provision, 42 U.S.C. § 12203, appears in Title IV of the ADA, it specifically provides that retaliation in the employment context constitutes a violation with respect to Title I for purposes of the remedies available. See note 4, supra.
[11] Niece notes that the court in Franklin found general damages available under Title IX of the Civil Rights Act, recognizing the availability of general damages under Title VI, and by an extension of reasoning to § 504 of the Rehabilitation Act. The court then concludes "[c]onsequently compensatory damages are available to plaintiffs asserting claims under 42 U.S.C. §§ 12132 and 12203." Niece v. Fitzner, 922 F. Supp. 1208, 1219 (E.D.Mich.1996). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581470/ | 957 F. Supp. 948 (1997)
Barton WILSON, et al., Plaintiffs,
v.
CITY OF LOUISVILLE, Defendant.
Civil Action No. C-94-0085-L(H).
United States District Court, W.D. Kentucky, Louisville Division.
March 13, 1997.
*949 Gilbert Hale Nutt, Terry E. Fox, Deborah G. Campbell, Louisville, KY, for Plaintiffs.
Thomas Lukins, City Law Department, Louisville, KY, for Defendant.
MEMORANDUM OPINION
HEYBURN, District Judge.
The Court now has before it the parties' cross-motions for summary judgment. Plaintiffs challenge the constitutionality of Article 11, Section F of the Zoning District Regulations of the Development Code for Jefferson County, Kentucky, as amended by the City of Louisville, Ordinance No. 133, Series 1992 ("the Ordinance"), which restricts certain types of signs, referred to as "small freestanding signs." Plaintiffs say that the Ordinance violates the First, Fifth and Fourteenth Amendments to the United States Constitution, as well as sections 1 and *950 3 of the Kentucky Constitution and the nonconforming use provisions of KRS 100.253.
The Court must determine whether the free speech and "takings" provisions of the Constitution prevent the City of Louisville from exercising its legislative discretion to improve the aesthetic appearance of the city and to enhance its public safety. After carefully considering the Ordinance and Plaintiffs' objections to it, the Court concludes that the Ordinance does not offend the United States Constitution, the Kentucky Constitution or any Kentucky statutes.
I.
Plaintiff Barton Wilson owns and operates a business which rents and sells signs to area business and churches. Most of Wilson's inventory consists of signs that measure four by eight feet and have two sides to them. The signs are attached to the ground by twelve inch nails which are driven through the feet of the legs into the ground below. Sometimes this requires drilling on hard surfaces. Plaintiff, Carlisle Baptist Church (the "Church") has owned such a sign for approximately ten years and uses it to promote special events. The sign is located in the Church's front lawn.
The Ordinance can be understood only within the context of the City's comprehensive sign regulation scheme. Article 11 of the Zoning District Regulations of the Development Code for Jefferson County contains comprehensive provisions regulating and restricting the use of signs in Jefferson County. Among the many provisions are those which regulate the use of a class defined as "small freestanding signs." Prior to 1992, both Wilson and the Church's signs were permitted but restricted as small freestanding signs. On July 15, 1992, the Louisville Board of Alderman passed the Ordinance, which further restricted the use of small freestanding signs within the city limits only by (1) reducing their maximum allowable size from thirty-two to eight square feet; (2) reducing their maximum allowable extension above the ground from nine feet to four feet; and (3) limiting the hours of display for permitted signs to the hours of business, profession, trade or occupation lawfully practiced on site.[1] In addition, the Ordinance adds a definitional section, explaining that: "Small freestanding sign shall mean any sign which is unattached to any structure or the ground." In essence, by reducing the allowable size of small freestanding signs, the Ordinance effectively prohibits the use of larger temporary signs. Plaintiffs challenge the constitutionality of this Ordinance.
In compliance with the statute for amending zoning regulations, the Director of Law for the City of Louisville referred the proposed ordinance to the Louisville and Jefferson County Planning Commission. The Planning Commission took testimony regarding the proposed ordinance at two public hearings and transcribed the testimony. On March 18, 1993, the Planning Commission adopted findings, which stated that the proposed ordinance "would further enhance and protect the community from visual nuisances and safety hazards to vehicular traffic caused by the currently permitted larger signage," and unanimously recommended that the Board of Aldermen adopt it. On July 13, 1993, the Board of Aldermen enacted the Ordinance, and the Ordinance was signed by Mayor Jerry Abramson two days later.
The Ordinance was scheduled to go into effect January 15, 1994, six months after its enactment. However, Jefferson Circuit Court Judge Geoffrey Morris issued a Restraining Order on January 15, 1994, enjoining the City of Louisville from taking any *951 action to implement, enforce or otherwise require compliance within the City of Louisville. That Restraining Order remains in effect today.
II.
Plaintiffs primarily argue that the Ordinance amounts to a violation of free speech, as protected by the First and Fourteenth Amendments to the U.S. Constitution, by prohibiting a means of communicating both commercial and non-commercial speech. Before beginning the analysis, this Court must determine which of the First Amendment tests to apply here. Plaintiffs say that the "strict scrutiny" test should be applied, while Defendant argues that the "time, place and manner" analysis is more appropriate.
The strict scrutiny analysis applies where a statute or regulation threatens to suppress the expression of particular ideas or viewpoints. Leathers v. Medlock, 499 U.S. 439, 447, 111 S. Ct. 1438, 1443-44, 113 L. Ed. 2d 494 (1991). The Ordinance is not content-based. Plaintiffs do not claim that it is. The Ordinance regulates the size and placement of portable signs without reference to their content. See Cleveland Area Board of Realtors v. City of Euclid, 88 F.3d 382, 387-88 (6th Cir.1996) ("[B]ecause Euclid's `time, place, and manner' restriction on signs is justified on the basis of aesthetics without reference to the content of the signs, it must be considered content-neutral under Renton and O'Brien."). Therefore, the strict scrutiny test is not appropriate here.
Nor does the Ordinance limit its scope to commercial signs. Therefore, the commercial speech test laid out in Metromedia is also inapplicable. See Metromedia, Inc. v. City of San Diego, 453 U.S. 490, 507, 101 S. Ct. 2882, 2892, 69 L. Ed. 2d 800 (1981). The First Amendment does not guarantee the right to communicate one's views at all times and places or in any manner. Wheeler v. Commissioner of Highways, 822 F.2d 586, 589 (6th Cir.1987). Where a regulation indirectly affects speech, without reference to the content of the speech, the Court must inquire as to whether the Ordinance: (1) is in furtherance of substantial state interests; (2) directly advances those interests; (3) has an effect on speech no greater than necessary to accomplish the City's purpose; and (4) leaves open alternate modes of communication. See Members of the City Council of Los Angeles v. Taxpayers for Vincent, 466 U.S. 789, 805, 812, 104 S. Ct. 2118, 2129, 2132, 80 L. Ed. 2d 772 (1984). The Court will address each of these concerns.
A.
The Supreme Court has found that the government has a substantial interest in promoting the safety and aesthetics of its cities. See Vincent, 466 U.S. at 807, 104 S.Ct. at 2130; Metromedia, 453 U.S. at 507-08, 101 S.Ct. at 2892-93. In the present case, the Louisville and Jefferson County Planning Commission held two public hearings and took testimony regarding the Ordinance. At the hearing, William P. Schreck, Director of the Department of Inspection, Permits and Licenses for the City of Louisville and the chief zoning enforcement officer for the City, testified and displayed slides depicting the large number of thirty-two square foot portable signs in Louisville and the resulting sense of clutter. Mr. Schreck also testified and presented slides regarding the dangers associated with the illuminated portable signs. Other witnesses testified as to issues of aesthetics and safety. As a result, the Planning Commission found that the Ordinance, as amended, "would further enhance and protect the community from visual nuisances and safety hazards to vehicular traffic caused by the currently permitted larger signage." Plaintiffs concede that aesthetic and safety concerns motivated the amendments. Defendant has shown, therefore, substantial government interests.
B.
The Ordinance must directly advance the asserted goals of aesthetics and safety. The Supreme Court in Metromedia explained that where the source of the problem has been identified here, the prohibited signs the "the most direct and perhaps the only effective approach to solving the problems they create is to prohibit them." Metromedia, *952 453 U.S. at 508, 101 S.Ct. at 2892. The Ordinance does just that.
The Supreme Court also emphasized the importance of deferring to the decisions of the local lawmakers regarding the source of the problems and the most effective way to deal with them. In Metromedia, the Court explained:
We likewise hesitate to disagree with the accumulated, common-sense judgments of local lawmakers and of the many reviewing courts that billboards are real and substantial hazards to traffic safety.
Metromedia, 453 U.S. at 509, 101 S.Ct. at 2893. Where the Planning Commission's conclusions are "not manifestly unreasonable," this Court should not set aside the resulting decisions. Id.
Finally, it should be noted that the Ordinance need not entirely eliminate all safety and aesthetic problems in order to have directly advanced its interests. As the Metromedia court explained, whether the Ordinance directly advances the interests it asserts "is not altered by the fact that the ordinance is underinclusive." Metromedia, 453 U.S. at 511, 101 S.Ct. at 2894. See also Vincent, 466 U.S. at 811, 104 S.Ct. at 2132 (explaining that "the validity of the aesthetic interest in the elimination of signs on public property is not compromised by failing to extend the ban to private property").
C.
Defendant also must show that the Ordinance is no broader than necessary, that is, that it is narrowly tailored to meet its interests of safety and aesthetics. See Heffron v. International Society for Krishna Consciousness, Inc., 452 U.S. 640, 647-48, 654, 101 S. Ct. 2559, 2563-64, 2567, 69 L. Ed. 2d 298 (1981). As the Supreme Court noted in Metromedia, "[if] the city has sufficient basis for believing that billboards are traffic hazards and are unattractive, then obviously the most direct and perhaps the only effective approach to solving the problems they create is to prohibit them." Metromedia, 453 U.S. at 508, 101 S.Ct. at 2892. In Vincent, the Court noted that where "the substantive evil visual blight is not merely a possible by-product of the activity, but is created by the medium of expression itself," a total ban "curtails no more speech than is necessary to accomplish its purpose." Vincent, 466 U.S. at 810, 104 S.Ct. at 2131. Similarly here, the Planning Commission specifically found that the prohibited signs were unattractive and constituted safety hazards. Consequently, their prohibition is the most direct method of addressing the government's interests in safety and aesthetics.
The Sixth Circuit recently has held that a total ban on residential yard signs with minimal exceptions "burdened substantially more speech than necessary, because it completely foreclosed an inexpensive and autonomous way to communicate." Cleveland, 88 F.3d at 388. However, unlike the case in Cleveland, the ban on portable signs of a specific size does not "completely foreclose" an inexpensive method of communication. Various other avenues are available to Plaintiffs, as discussed in Section II.D. The availability of alternative avenues of communication, however, is not determinative on this issue. If the Planning Commission identifies certain portable signs as creating a visual blight, then to ban those signs entirely is not excessive on its face. Whether or not this ban leaves other avenues of communication open is a separate inquiry.
D.
"While the First Amendment does not guarantee the right to employ every conceivable method of communication at all times and in all places ... a restriction on expressive activity may be invalid if the remaining modes of communication are inadequate." Vincent, 466 U.S. at 812, 104 S.Ct. at 2132. The Supreme Court has interpreted this requirement liberally. In Vincent, the court noted that a prohibition against posting signs on public property "does not affect any individual's freedom to exercise the right to speak and to distribute literature in the same place where the posting of signs on public property is prohibited." Vincent, 466 U.S. at 812, 104 S.Ct. at 2132. Applying similar reasoning here, Plaintiffs still have adequate alternative modes of communication available to them. Plaintiffs can distribute flyers and *953 send out leaflets. In addition, the Ordinance only prohibits small freestanding signs of a certain size. Plaintiffs may still use smaller portable signs as well as larger permanent signs. As Defendant notes, there is no evidence in the record that users of larger portable signs cannot adequately convey their messages on smaller portable signs, or by any other method of communication.
The Court's four-part analysis leaves little doubt that considering the Supreme Court's criteria, the Ordinance does not offend constitutional principles.[2]
III.
Plaintiffs also claim that the Ordinance effects an unconstitutional taking without just compensation, under the Fifth and Fourteenth Amendments. The Takings Clause of the Fifth Amendment, made applicable to the States through the Fourteenth Amendment, provides: "[N]or shall private property be taken for public use, without just compensation." Dolan v. City of Tigard, 512 U.S. 374, 383-84, 114 S. Ct. 2309, 2316, 129 L. Ed. 2d 304 (1994). Plaintiffs say that the Ordinance constitutes a taking because under the Ordinance, Wilson could no longer lease his signs in Louisville and the Church could not use the sign on its property.
When Justice Holmes first recognized that a government regulation could constitute a Fifth Amendment taking in Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 415, 43 S. Ct. 158, 159, 67 L. Ed. 322 (1922), he did not explain precisely how far the regulation would have to go to do so. Ever since, the Supreme Court has struggled to develop a consistent approach to individual cases in which regulations deprive property owners of some use or value of their property. In Agins v. City of Tiburon, the Court explained that a zoning ordinance effects a taking if: (1) it does not substantially advance legitimate state interests; or (2) it denies an owner economically viable use of his property. 447 U.S. 255, 260, 100 S. Ct. 2138, 2141, 65 L. Ed. 2d 106 (1980). However, the application of this test has been difficult. Justice Scalia, among others, conceded that the Court has generally eschewed any set formula and has engaged in essentially ad hoc factual inquiries. See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1015, 112 S. Ct. 2886, 2893, 120 L. Ed. 2d 798 (1992); see also Katherine Dunn Parsons, Comment, Billboard Regulation After Metromedia and Lucas, 31 Hous.L.Rev. 1555, 1581-1605 (1995).
With regard to the first part of the test, the Court must determine whether the asserted interests of the regulation are substantial and whether the means to achieve those interests are reasonable. The Court has already determined that the Ordinance properly meets both of these criteria. See Agins, 447 U.S. at 261, 100 S.Ct. at 2141-42 (holding an ordinance which aided the preservation of open space was a valid exercise of the city's police power to protect its citizens against the ill effects of urbanization and advanced a legitimate governmental purpose).
The application of the second part is more problematic. To assess economic viability, it appears as though the Supreme Court actually balances a number of factors, such as the character of the governmental action,[3] the *954 harshness of the taking, the valid investment-backed expectations of the property owner and whether the burden and benefit of the public action are shared by the property owner, in making this determination. See Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 124, 98 S. Ct. 2646, 2659, 57 L. Ed. 2d 631 (1978).
A.
After reviewing the record the Court concludes that the Ordinance does not deprive Wilson of economically viable use of his property. Approximately 80% of Wilson's business is conducted outside of Louisville, in the remainder of Jefferson County, which is not covered by the Ordinance. Since his signs still may be leased in the county or outside of it, Wilson has the option of marketing the remaining 20% of his inventory to customers in those areas. In addition, Wilson could sell his inventory to someone who may use it elsewhere. Even if he could not do so, a 20% decrease in the value of his inventory does not necessarily constitute a taking. See Andrus v. Allard, 444 U.S. 51, 66, 100 S. Ct. 318, 327, 62 L. Ed. 2d 210 (1979) ("[A] reduction in the value of property is not necessarily equated with a taking.").
When an owner shows a diminution in the value of his property resulting from the city's exercise of police powers, courts typically look to see if the benefits and burdens of the regulation are shared by other owners in the community. Agins, 447 U.S. at 262, 100 S.Ct. at 2142. In the present case, Wilson will share the burden as well as the benefits of the Ordinance: Wilson is not the only owner precluded from using his signs and he, along with the others, will benefit from the improved aesthetic appearance of the city as well as the improved safety of the traffic.
Whether a regulation deprives an owner of economically viable use of its property is admittedly an imprecise determination. It is clear, however, that the Court should also consider "whether the interference with [the owner's] property is of such a magnitude" that the state must compensate him for its loss in value. Penn Central, 438 U.S. at 136, 98 S.Ct. at 2665. In doing so, the Court should view the owner's property as a whole, not in parcels. See Keystone Bituminous Coal Ass'n v. DeBenedictis, 480 U.S. 470, 497, 107 S. Ct. 1232, 1248, 94 L. Ed. 2d 472 (1987). Therefore, the focus should be on whether Wilson can glean a profit from his entire inventory of signs rather than the 20% marketed to Louisville customers.
In considering the magnitude of the city's interference with the owner's property, the Penn Central Court found that the interference was not significant enough to require compensation because, first, the regulation allowed the owner to continue to use the property as it had been used for the past 65 years, hence not interfering with the owner's primary expectation concerning use of the property, and, second, the regulation allowed the owner to continue to profit and obtain a reasonable return from the use of the property. Penn Central, 438 U.S. at 136, 98 S.Ct. at 2665. Similarly here, the Ordinance allows Wilson to continue leasing and selling his signs outside of Louisville and since Wilson can continue to make a profit on his signs, the Ordinance does not render Wilson's business commercially impracticable. Therefore, the Ordinance does not interfere with Wilson's property to such a degree as to require just compensation.
Furthermore, the Court in Andrus v. Allard noted that, "Regulations that bar trade in certain goods have been upheld against claims of unconstitutional taking." 444 U.S. at 67, 100 S.Ct. at 327. See also Penn Central, 438 U.S. at 126, 98 S.Ct. at 2660 (listing cases in which laws prohibiting the continuation of otherwise lawful businesses were upheld against takings challenges). The Supreme Court has stated that the government has the right to regulate the marketing and use of property, even to the detriment of the property's owner. See Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1006, 104 S. Ct. 2862, 2874, 81 L. Ed. 2d 815 (1984) (holding that the plaintiff did not have "a reasonable, investment-backed expectation that EPA would keep the data confidential beyond the limits prescribed in the amended statute itself'").
Recently, the Supreme Court stated in dicta that a regulation could render personal property valueless without constituting a *955 taking, explaining that an owner of personal property should be aware of the possibility of new regulation which may render its property worthless because of the State's traditionally high degree of control over commercial dealings. See Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 1027-28, 112 S. Ct. 2886, 2899-2900, 120 L. Ed. 2d 798 (1992). This reasoning applies to the regulation of signs. Signs, including the ones sold and leased by Wilson, were regulated prior to the Ordinance. Wilson had no right to assume that the sign regulations would remain unchanged. Therefore, even if the Ordinance rendered all of Wilson's signs worthless, it is questionable whether it would constitute a taking. In these circumstances Defendant may regulate the use of signs without having to compensate the owners.
The Supreme Court has also expressed a reluctance to base a takings claim on the loss of future profits. See Andrus, 444 U.S. at 66, 100 S.Ct. at 327 ("At any rate, loss of future profits unaccompanied by any physical property restriction provides a slender reed upon which to rest a takings claim.... Further, perhaps because of its very uncertainty, the interest in anticipated gains has traditionally been viewed as less compelling than other property-related interests."). Wilson's anticipated loss of future profits from his Louisville customers is highly speculative considering the uncertainty as to whether they would have continued leasing from him absent the Ordinance and whether he will be able to redirect his entire inventory to non-Louisville customers. It would seem that Wilson's interest in anticipated profits from his Louisville customers is too speculative to support a Fifth Amendment takings claim.
B.
The question of whether a taking has occurred is slightly different with regard to the Church. Unlike the analysis of Wilson's claim, the Court cannot concentrate on the commercial use and profit interests surrounding the Church's sign, but must focus on the Ordinance's effect on the use and value of the sign to the Church. As with Wilson, the Court concludes that the Ordinance cannot be deemed a taking as to the Church under the Supreme Court's current jurisprudence.
Under the Ordinance, the Church is left with at least one economically viable use for its sign it can sell it to someone who lives outside of Louisville, and who has some non-restricted use for it. Other circuits have held that as long as property remains sufficiently desirable to permit its owner to sell it on the open market for its intended use, no regulatory taking has occurred. See, e.g., Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 95 F.3d 1422, 1433 (9th Cir. 1996); Park Ave. Tower Assoc. v. City of New York, 746 F.2d 135, 139 (2d Cir.1984). In this case it is unclear whether the Church would suffer any diminution in the value of its sign since the Ordinance has not affected its desirability with regard to those living outside the Ordinance's jurisdiction.
Even if the Church could not sell its sign, it is questionable whether the Ordinance would constitute a taking. As noted above, the Supreme Court has stated that it is unlikely that an owner of personal property who has a reasonable expectation that its property will be regulated, or regulated further as is the case here, would have a takings claim. See Lucas, 505 U.S. at 1027-28, 112 S.Ct. at 2899-2900. Cities must be allowed to regulate in pursuit of legitimate public goals. Regulation inevitably impinges on the private rights of its citizens. If a city were required to reimburse every citizen for every regulation which resulted in economic loss for that citizen, the city essentially would have to regulate by purchase. Andrus, 444 U.S. at 65, 100 S.Ct. at 326-27. Government would be stifled if it were required to pay for each change in law. See Pennsylvania Coal v. Mahon, 260 U.S. 393, 413, 43 S. Ct. 158, 159, 67 L. Ed. 322 (1922). As the Supreme Court noted in Penn Central, "`taking' challenges have also been held to be without merit in a wide variety of situations when the challenged governmental actions prohibited a beneficial use to which individual parcels had previously been devoted and thus caused substantial individualized harm." Penn Central, 438 U.S. at 125, 98 S.Ct. at 2659. Similarly *956 here, the Ordinance should not be deemed a taking simply because it prohibits a beneficial use of the Church's sign. Like Wilson, the Church will share the burdens and the benefits of the Ordinance with other sign owners.
The Lucas Court held that, "Where the State seeks to sustain regulation that deprives land of all economically beneficial use, we think it may resist compensation only if the logically antecedent inquiry into the nature of the owner's estate shows that the proscribed use interests were not part of his title to begin with." 505 U.S. at 1027, 112 S.Ct. at 2899. That is, a regulation does not constitute a taking where the government "takes" an interest the owner did not acquire within its bundle of ownership rights. In this case, the Church never acquired the right to use its sign in the face of a regulation advancing the legitimate state goals of safety and aesthetics. In fact, the Church purchased its sign in the face of the numerous regulations governing it. As with Wilson, the Church did not purchase the right to be exempted from those regulations or from any subsequent changes to those regulations. Therefore, as is the case with Wilson, the Church's takings claim must be dismissed.
IV.
Plaintiffs assert that the Ordinance is tailored in such a way as to circumvent the protection given in KRS 100.253 to existing nonconforming uses, placing the Ordinance in direct conflict with Kentucky law. An ordinance which conflicts with a Kentucky statute is invalid. See City of Harlan v. Scott, 290 Ky. 585, 162 S.W.2d 8, 9 (1942) ("An ordinance may cover an authorized field of local laws not occupied by general laws but cannot forbid what a statute expressly permits and may not run counter to the public policy of the state as declared by the Legislature."). However, in the Court's view, the Ordinance does not conflict with the statutory definition of nonconforming uses.
The nonconforming use statute provides that:
The lawful use of a building or premises, existing at the time of the adoption of any zoning regulations affecting it may be continued, although such use does not conform to the provisions of such regulations, except as otherwise provided herein.
See KRS 100.253(1). The zoning regulations attempt to exclude the use of small freestanding signs from the protection of this statute by stating that:
For purposes of KRS 100.253 small freestanding signs shall be regarded as personal property unattached to the real property on which they are placed and such signs are not structures and no nonconforming land use rights shall attach to them.
The Kentucky statute which defines nonconforming uses does not explicitly depend on this distinction between personal property which is attached to the ground and that which is unattached. According to Kentucky law, a "nonconforming use or structure" means:
[A]n activity or a building, sign, structure or portion thereof which lawfully existed before the adoption or amendment of the zoning regulation, but which does not conform to all of the regulations contained in the zoning regulation which pertain to the zone in which it is located.
KRS 100.111(13). However, the definition of "structure," which explicitly includes signs under its rubric, does make a distinction between permanent and non-permanent structures. According to the statute, a structure is:
[A]nything constructed or made, the use of which requires permanent location in or on the ground or attachment to something having a permanent location in or on the ground, including buildings and signs.
KRS 100.111(21) (emphasis added). Thus, the Ordinance's reason for excluding small freestanding signs from the definition of a nonconforming use, seems to be valid.
In addition, the purpose behind allowing non-conforming uses is to prevent excessive hardship on those whose permanent structures no longer conform to the law. This concern is not implicated with property which is temporary and which easily can be *957 made to conform with the new zoning regulations. Therefore, the language of the Ordinance appears to be in keeping with the intent of the legislature in separating out permanent structures for protection.
The small free-standing signs at issue here, while technically attached to the ground, are not permanent: they do not require permanent location in or on the ground, they are only attached to the ground by 12-inch stakes and they are marketed for their portability. Since the small freestanding signs are not permanent, they are not protected under KRS 100.253 as non-conforming uses.[4]
V.
Plaintiffs claim that the Ordinance is void for vagueness. In particular, they claim that a "small freestanding sign," which is defined as "any sign which is unattached to any structure or the ground" is insufficient to give an individual of ordinary intelligence a reasonable opportunity to know what is prohibited. See Grayned v. City of Rockford, 408 U.S. 104, 108-09, 92 S. Ct. 2294, 2298-2300, 33 L. Ed. 2d 222 (1972) (laying out the standard for vagueness). However, when examining an ordinance for vagueness, courts must look at the ordinance as a whole. See id.; see also Schenck v. Pro-Choice Network of Western New York, ___ U.S. ___, ___, 117 S. Ct. 855, 869-70, 137 L. Ed. 2d 1 (1997).
Article 11 of the Zoning District Regulations deals with every type of outdoor sign. By process of elimination, it is clear that Section F applies to Plaintiffs' signs. Even if this were not the case, the text of Article 11 is followed by a series of illustrations to guide those who are still unclear about the applicability of the sections. In particular, Illustration No. 14 depicts "small freestanding signs" in such a way as to make it clear that it includes Plaintiffs' signs. Finally, owners of sign businesses such as Plaintiff Wilson's, attended the public hearings regarding the proposed Ordinance, which seems to indicate that it was clear to those owners which signs the Ordinance would cover.
VI.
Finally, Plaintiffs claim that the Ordinance violates their right to equal protection under sections 1 and 3 of the Kentucky Constitution, presumably because the Ordinance singles out Plaintiffs' signs to be prohibited. In order to apply the proper level of scrutiny to Plaintiffs' equal protection claims, this Court must determine whether (1) Plaintiffs belong to a suspect class or (2) the Ordinance burdens a fundamental right. See Transportation Cabinet v. Feige, 889 S.W.2d 52, 54 (Ky.Ct.App.1994). Plaintiffs have not alleged that they belong to a suspect class and, as discussed above, the Ordinance burdens neither Plaintiffs' fundamental right of free speech nor Plaintiffs' fundamental right to just compensation for a taking of property. Plaintiffs allege the infringement of no other fundamental rights. As a result, this court must apply a rational basis test to determine whether the Ordinance violates sections 1 and 3 of the Kentucky Constitution. Hooks v. Smith, 781 S.W.2d 522, 523 (Ky.Ct.App. 1989). The rational relationship level of scrutiny has traditionally been applied to determine whether a zoning regulation violates an individual's equal protection guarantees. Bannum, Inc. v. City of Louisville, 958 F.2d 1354, 1360 (6th Cir.1992).
The Planning Commission based its decision to amend on two separate public hearings in which opponents and proponents of the proposed amendments testified. The *958 Commission adopted findings which held that the proscribed portable signs were detrimental to both the aesthetics and safety of the city. It is not the role of the judiciary to question the findings and conclusions of a legislative body responsible for such decisions; it is enough that the Commission acted rationally based on those findings. Given the Commission's findings, the ban on the proscribed signs is the most direct way to achieve the legitimate goals of aesthetic improvement and safety.[5] As a result, this Court must conclude that the Ordinance was rationally related to those goals and, consequently, that the Ordinance does not violate the Kentucky Constitution.
The Court will issue an order consistent with this Memorandum Opinion.
ORDER
The Court has considered the parties' motions for summary judgment and has filed a Memorandum Opinion. Being otherwise sufficiently advised,
IT IS HEREBY ORDERED that Plaintiffs' Motion for Summary Judgment is DENIED;
IT IS FURTHER ORDERED that Defendant's Motion for Summary Judgment is GRANTED and Plaintiff's Complaint is DISMISSED with prejudice.
This is a final and appealable order.
NOTES
[1] The Ordinance provides, in part, as follows:
"Small freestanding sign" shall mean any sign which is unattached to any structure or the ground.
(1) The small freestanding sign shall not exceed eight (8) square feet of surface area per face and there shall be no more than two (2) faces. The sign shall not extend more than four (4) feet above the ground on which it is placed.
(2) The small freestanding sign shall advertise only the business, profession, trade or occupation lawfully practiced on site and/or the generic or brand name products or services lawfully available on site, or religious, charitable, or other non-commercial messages. Display of small freestanding signs shall be limited to the hours of operation of the business, profession, trade or occupation lawfully practiced on site.
[2] Plaintiffs also assert that the Ordinance impermissibly deprives Plaintiffs of liberty and property without due process of law, in violation of the Fourteenth Amendment. According to the Supreme Court in Metromedia, the Due Process Clause does not afford a greater degree of protection than does the First Amendment:
Since we hold that the First Amendment interests [in this case] are not sufficient to prevent the city from [enforcing its ordinance], no different result should be reached under the Due Process Clause.
Metromedia, 453 U.S. at 521 n. 25, 101 S.Ct. at 2899 n. 25.
Since the Ordinance is not in conflict with the First Amendment, this Court may conclude without extensive analysis that the Ordinance does not violate the Due Process Clause of the Fourteenth Amendment.
[3] According to the Supreme Court, "A `taking' may more readily be found when the interference with property can be characterized as a physical invasion by government...." Penn Central Transp. Co. v. City of New York, 438 U.S. 104, 124, 98 S. Ct. 2646, 2659, 57 L. Ed. 2d 631 (1978). The Court will not dwell on this factor except to note that this is not a case of a physical invasion of Plaintiffs' property.
[4] Other jurisdictions have arrived at similar results. See, e.g., New Castle County v. Harvey, 315 A.2d 616, 619 (Del.Ch.1974) (holding that use of a lot for temporary parking was not a valid nonconforming use); State of New Jersey v. Gargiulo, 103 N.J.Super. 140, 246 A.2d 738, 742 (1968) ("While business signs may attain the status of nonconforming uses ... the temporary use of a sign or banner ... does not amount to a nonconforming use which may be continued after enactment of an ordinance."). See also Wis. Stat. § 59.69(10)(a) (1996) ("[T]he continuance of the nonconforming use of a temporary structure may be prohibited").
[5] The rational basis standard used by Kentucky courts is extremely deferential, as evinced by the language used in Hooks: "It is certainly not beyond reason that the legislature would deem it advisable" to act as it did. See Hooks, 781 S.W.2d at 523. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581634/ | 957 F.Supp. 331 (1997)
UNITED STATES of America,
v.
Anthony Mark SHEA.
Criminal No. 96-12-01-B.
United States District Court, D. New Hampshire.
March 18, 1997.
*332 Gary Milano, Asst. U.S. Atty., Concord, NH, for Plaintiff.
Bjorn Lange, Federal Defender, Concord, NH, for Defendant.
MEMORANDUM OPINION
BARBADORO, District Judge.
Two men wearing masks and gloves broke into the Londonderry, branch of the First New Hampshire Bank about an hour after closing on August 4, 1995. One of the robbers apparently cut himself when he entered the building, as bloodstains were discovered inside the bank and in a stolen minivan believed to have been used as a getaway vehicle.
The government later charged Anthony Shea with the robbery and proposed to base its case in part on expert testimony comparing Shea's DNA with DNA extracted from several of the bloodstains. The government's expert, a forensic scientist employed by the FBI, used a method of DNA analysis known as Polymerase Chain Reaction ("PCR"), in determining that Shea has the same DNA profile as the person who left several of the blood stains at the crime scene and in the getaway vehicle. The expert also concluded that the probability of finding a similar profile match if a DNA sample were drawn randomly from the Caucasian population is 1 in 200,000.
Shea moved to exclude the DNA evidence prior to trial. Although he conceded that the scientific principles underlying PCR are generally accepted in the fields of molecular biology and forensic science, he argued that the evidence is inadmissible pursuant to Fed. R.Evid. 702 because the FBI's PCR methods are unreliable. He also challenged the government's random match probability estimate for similar reasons. Finally, he argued that evidence of a random match probability is barred by Fed.R.Evid. 403 because the risk that the jury would be misled by the evidence substantially outweighs its probative value.
After holding an evidentiary hearing and carefully considering Shea's arguments, I denied his motion to exclude. Shea subsequently was convicted of attempted bank robbery and several related charges. In this opinion, I explain why I admitted the DNA evidence.
I.
In order to appreciate Shea's contentions, one must understand certain generally accepted principles and methodologies used in the fields of molecular biology and population genetics. Accordingly, I begin by describing several basic concepts used in human genetics, the DNA typing methodology at issue in this case, and the statistical methods the government's expert used in attempting to determine the probability of a random match.[1]
*333 A. Some Basic Concepts Used in Human Genetics
DNA, an acronym for deoxyribonucleic acid, is the chemical blueprint for life. Most human cells other than reproductive cells contain identical copies of a person's DNA. Although 99.9% of human DNA does not vary from person to person, no two persons other than identical twins have the same DNA. NRC II, supra, at 63.
Human DNA is organized into 23 pairs of chromosomes and each chromosome contains a DNA molecule. DNA molecules have a double stranded helical structure that can be envisioned as a spiral staircase. NRC I, supra, at 2. See Figure 1. Running between the two sugar-phosphate strands forming the handrails of the staircase are millions of steps comprised of two loosely bound nitrogen bases. Each step is referred to as a base pair. There are four types of bases: adenine (A), thymine (T), guanine (G), and cytosine (C). A's ordinarily pair only with T's, and C's ordinarily pair only with G's. Thus, if the sequence of bases on one side of a DNA molecule is known, the corresponding sequence of bases on the other side can be deduced. The arrangement of base pairs in chromosomal DNA comprises the genetic code that differentiates humans from non-humans and makes every person unique. Mange, supra, at 19-20.
In total, the DNA molecules in the 23 pairs of human chromosomes contain approximately 3.3 billion base pairs. Most of the base pairs are arranged in the same sequence in all humans. NRC II, supra, at 62-63. However, every DNA molecule has regions known as polymorphic sites where variability is found in the human population.[2] Each possible arrangement of base pairs that occurs at a polymorphic site is referred to as an allele. Alleles can result from differences in a single base pair, differences in multiple base pairs, or differences in the number of base pairs that comprise a site.
The combination of alleles from corresponding sites on a chromosome pair is sometimes referred to as the site's genotype.[3] NRC II, supra, at 216. One allele for each single locus genotype is inherited from each parent. If both parents contribute the same type of allele, the child's genotype is considered to be homozygous. If each parent contributes a different type of allele, the child's genotype is considered to be heterozygous. To illustrate, if only two alleles for a locus are found in the population, A and a, two homozygous genotypes, AA and aa, and one heterozygous genotype, Aa, will be found in the population. Although an individual's genotype consists of either two copies of the same allele or one copy of each of two different alleles, many different alleles may be found in the population for a single locus. NRC II, supra, at 15.
B. PCR Amplification and Typing
PCR and Restriction Fragment Length Polymorphism ("RFLP")[4] are the two methods most often used in forensic DNA typing. In this case, the government relies exclusively on PCR. PCR has two aspects, amplification and allele identification.
*334 1. PCR Amplification
PCR amplification is a process for making many copies of selected portions of a DNA sample. NRC I, supra, at 40. The process requires the use of a primer for each end of a polymorphic site. Primers are synthetic single-stranded DNA molecules consisting of approximately 20 bases. They are arranged in a sequence that complements the bases on one strand of the double-stranded DNA molecule in a known region flanking the site at issue. Amplification is commenced by adding two corresponding primers for each end of a site, an enzyme known as DNA polymerase, and many free floating copies of the four bases (A, C, T and G) to a purified DNA sample. The double-stranded DNA molecules in the sample are then denatured. Denaturing separates double-stranded DNA molecules into single-stranded molecules with complementary base sequences. After the DNA is denatured, the primers bind with the denatured DNA at their complementary sites such that one primer binds to one strand at one end of the studied site and the other primer binds to a complementary strand at the other end of the site. Mange, supra, at 287. See Figure 2. Primers have 3' and 5' ends. The denatured DNA is replicated only from each primer's 3′ end leaving the portion of a molecule on the 5' end single-stranded. Mange, supra, at 256, 287. Each step in the process after the primers are added is accomplished through carefully controlled changes in temperature in a device known as a thermal cycler. Mange, supra, at 288.
The amplification process is repeated many times. After the third cycle, some copies are produced that contain only the polymorphic region and its flanking primers. See Figure 3. The number of these copies grows exponentially with each cycle. Eventually, enough copies of the shorter segments are produced to permit the amplified alleles to be identified. Mange, supra, at 288.
Seven different polymorphic sites were analyzed in this case. DQ Alpha; Low Density Lipoprotein Receptor (LDLR); Glycophorin A (GYPA); Hemoglobin G Gammaglobin (HBGG); D7S8; Group-Specific Component (Gc); and D1S80.[5] The DQ Alpha site and the five sites collectively known as the Polymarker sites (LDLR, GYPA, HBGG, D7S8 and Gc) were amplified simultaneously using a commercially available test kit known as the "AmpliType PM PCR Amplification and Typing Kit." The D1S80 site was amplified separately.
2. Identification of Amplified Alleles
Once a DNA sample is amplified, the specific polymorphic sites must be typed. The DQ Alpha and Polymarker sites are typed as follows. The amplified DNA is denatured once more and washed over strips of allele-specific probes. Each probe itself contains denatured DNA segments comprising an allele that is known to exist at the studied site.[6] Both the DQ Alpha and Polymarker test strips also have control probes that contain many copies of a denatured portion of the DQ Alpha site that all of the DQ Alpha alleles have in common. The amplified DNA binds with the denatured DNA in the control probes and those allele-specific probes that contain DNA segments with complementary sets of bases. NRC I, supra, at 42. A reagent is then applied which causes colored dots to appear at any probes where binding has occurred. Because the control probes contain DNA segments that will bind with all of the DQ Alpha alleles, the control probes will always show a positive response if the sample contains human DNA and the tests are performed properly. If the sample contains DNA from only one person and the *335 person is homozygous at a locus, the test will show a positive reading for only one allele at that locus. If the person is heterozygous, the test will be positive for two alleles. Because the chemical reactions occurring in this process also are sensitive to temperature, they are conducted in a water bath at designated temperatures.
The D1S80 site is typed differently because alleles for this site result from variations in the number of times that a contiguous sequence of 16 base pairs is repeated. NRC II, supra, at 74. The process used to type amplified D1S80 is known as gel electrophoresis. In this process, amplified D1S80 is deposited at one end of a thin slab of a gel material. The gel is then placed in an electric field and this field causes the amplified D1S80 to migrate through the gel. The rate at which the D1S80 segments travel through the gel depends upon the length of the amplified alleles. Shorter alleles travel further in a given time than longer alleles. After a predetermined time, the gel is removed from the electric field and the amplified D1S80 in the gel is stained. The sample can then be typed based on the distance the amplified DNA has traveled through the gel. Mange, supra, at 299-301.
PCR is a very potent process which can result in the amplification of very small amounts of DNA. Accordingly, special care must be taken to minimize the possibility that samples become contaminated though mishandling. Among the other issues that are sometimes raised when considering the PCR process are: (1) the potential that primers or probes might bind at points other than the areas flanking the site under study; (2) concerns that the process has a limited capacity to identify mixtures of more than one person's DNA; and (3) suggestions that the laboratory performing the test in a particular case might fail to detect and correct erroneous results.
C. Population Genetics
The PCR analysis conducted in this case allegedly demonstrates that Shea's DNA matches DNA extracted from several of the bloodstains at seven studied sites. To put this finding in context, the government offered evidence that the probability of finding a similar match if a DNA sample were drawn randomly from the Caucasian population is 1 in 200,000. This random match probability essentially expresses the expected frequency of the observed DNA profile in a pertinent population.
The process of calculating a random match probability begins with a determination of the allele frequencies comprising the DNA profile. An allele frequency is simply a statement of relative proportion that is customarily expressed as a decimal fraction.[7] Genotype frequencies are calculated by squaring the frequency of the single allele comprising each homozygous genotype (P2) and by doubling the product of the two allele frequencies comprising each heterozygous genotype (2PiPj).[8] NRC I, supra, at 4; NRC II, supra, at 92. The law of genetics that permits genotype frequencies to be determined in this way under proper conditions is called the Hardy-Weinberg law.[9] Mange, supra, at 408-11. Once genotype frequencies are determined, the probability of a random match of genotypes at multiple sites is calculated by multiplying the frequencies of the sample's genotypes at each site.[10]
*336 The rule that the joint probability of multiple independent events can be determined by multiplying the frequencies of the individual events is known as the product rule. Mange, supra, at 61. The product rule can be applied reliably in the manner described above only if the estimate of allele frequencies is reasonably accurate and the conditions in the population approximate what are known as Hardy-Weinberg equilibrium and linkage equilibrium.
(1) Accuracy of Allele Frequencies Estimates
Because it is not practical to test an entire population, allele frequencies are derived from databases of DNA samples. If these databases do not accurately reflect the distribution of alleles in the population either because the sample size is too small or because of a bias in the way in which samples were selected for inclusion the calculation of a random match probability may be unreliable. NRC I, supra, at 10.
(2) Hardy-Weinberg Equilibrium
Hardy-Weinberg equilibrium is the state in which genotype frequencies can be calculated reliably using the Hardy-Weinberg law. Hardy-Weinberg equilibrium will exist for a large population if there is approximately random mating within the population, a negligible amount of biased mutation occurs in the alleles comprising the genotypes under study, migration is limited and unbiased, and natural selection is insignificant. Large deviations from Hardy-Weinberg equilibrium make it difficult to reliably determine genotype frequencies from allele frequencies.[11] Mange, supra, at 410-411.
(3) Linkage Equilibrium
The product rule can be used reliably only if the events considered in a joint probability calculation are independent.[12] Thus, to the extent that genotypes at multiple sites are linked, it becomes more difficult to calculate a random match probability using the product rule. Linkage equilibrium exists in a population when alleles comprising the genotypes at one site are not associated with the alleles comprising genotypes at other sites. NRC II, supra, at 106. If Hardy-Weinberg equilibrium persists in a population over several generations, the population will approach linkage equilibrium.[13] NRC II, supra, at 27. Linkage equilibrium will be approached more quickly for sites on different chromosomes than for sites on the same chromosome, and widely spaced sites on the *337 same chromosome will approach linkage equilibrium more quickly than sites that are close together. NRC II, supra, at 64, 106. Whereas Hardy-Weinberg equilibrium will produce alleles in Hardy-Weinberg proportions after a single generation, it takes several generations before linkage equilibrium is approached. NRC II, supra, at 106.
Hardy-Weinberg equilibrium and linkage equilibrium are rarely attained in real populations, most significantly because real populations are finite and contain subgroups that are perpetuated by non-random mating. Accordingly, debate about whether the product rule can be used reliably often focuses on the power of the statistical methods used to detect deviations from Hardy-Weinberg equilibrium and linkage equilibrium and the adequacy of the measures that are used to account for potential deviations.
II.
A. Rule 702
Expert testimony must satisfy three requirements in order to survive a Rule 702 objection: (1) the witness must be qualified by "knowledge, skill, experience, training or education;" (2) the witness's testimony must concern "scientific, technical or other specialized knowledge;" and (3) the testimony must "assist the trier of fact to understand the evidence or to determine a fact in issue." United States v. Shay, 57 F.3d 126, 132 (1st Cir.1995)(quoting Fed.R.Evid. 702). In this case, only the second of Rule 702's requirements is in serious dispute.[14]
When an expert bases opinion testimony on scientific knowledge, the testimony will not be admitted unless it is derived by the scientific method and is supported by "appropriate validation." Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 590, 113 S.Ct. 2786, 2795, 125 L.Ed.2d 469 (1993). Rule 702 thus establishes a standard of evidentiary reliability that focuses on the scientific validity of the expert's methods rather than the soundness of his specific conclusions.[15]United States v. Bonds, 12 F.3d 540, 566 (6th Cir.1993). Moreover, each logical step in the expert's analysis must be scientifically valid because, as the Supreme Court observed in Daubert, "scientific validity for one purpose is not necessarily scientific validity for other, unrelated purposes." 509 U.S. at 591, 113 S.Ct. at 2796; see also In re Paoli R.R. Yard PCB Litig., 35 F.3d 717, 743 (3d Cir.1994)("Paoli II"), cert. denied, ___ U.S. ___, 115 S.Ct. 1253, 131 L.Ed.2d 134 (1995). In Daubert, the Supreme Court described this consideration as "fit."[16]Daubert, 509 U.S. at 591, 113 S.Ct. at 2795-96.
Almost any challenge to an expert's conclusions can be redefined as a dispute over methods. However, Rule 702's reliability requirement distinguishes between a claim that an expert's methods are unsound and a claim that scientifically sound methods have been applied improperly in a particular case. A claim that scientific methods are unsound must be addressed initially by the trial judge, while a claim that scientifically sound methods have been applied improperly ordinarily should be left for the jury to resolve unless the alleged "error negates the basis for the reliability of the principle itself." United States v. Martinez, 3 F.3d 1191, 1198 (8th Cir.1993), cert. denied, 510 U.S. 1062, 114 S.Ct. 734, 126 L.Ed.2d 697 (1994).
Among the factors that a court should consider in determining whether scientific testimony is reliable are: (1) whether the expert's opinion can be or has been tested; (2) whether the theory or technique on which the opinion is based has been subjected to peer review and publication; (3) the technique's *338 known or potential error rate; (4) the existence and maintenance of standards controlling the technique's operations; and (5) "general acceptance."[17]Daubert, 509 U.S. at 592-95, 113 S.Ct. at 2796-98; Paoli II, 35 F.3d at 742. No single factor is necessarily dispositive in this analysis and other factors might also warrant consideration in the appropriate case.[18]Daubert, 509 U.S. at 594, 113 S.Ct. at 2797.
B. Rule 403
Rule 403 requires the exclusion of otherwise admissible expert testimony if the probative value of the evidence is substantially outweighed by "the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence." Fed.R.Evid. 403. Expert testimony must be closely scrutinized for compliance with Rule 403 because, as the court in Daubert recognized, "[e]xpert evidence can be both powerful and quite misleading...." Daubert, 509 U.S. at 595, 113 S.Ct. at 2798 (quoting Jack B. Weinstein, Rule 702 of the Federal Rules of Evidence is Sound; It Should Not be Amended, 138 F.R.D. 631, 632 (1991)); see also, United States v. Fosher, 590 F.2d 381, 383 (1st Cir.1979). Nevertheless, relevant and reliable expert testimony ordinarily should be admitted notwithstanding Rule 403 unless the potential that it will be used improperly substantially outweighs any legitimate persuasive value that the evidence may have. See Paoli II, 35 F.3d at 747 (expert testimony should not be excluded simply because it is complex unless there is something about the particular technique at issue that overwhelms the jury's ability to independently assess the evidence).
III.
Shea's challenges to the DNA evidence fall into three categories. First, he argues that the FBI's PCR testing protocols contain errors and omissions that render the methodology suspect. Second, he contends that the product rule cannot be used to calculate the probability of a random match because the databases on which the calculation is based are too small. Finally, he asserts that the government should be barred from informing the jury of the probability of a random match because it will mislead the jury. I address each class of contentions in turn.[19]
A. PCR Typing Protocols
The PCR Typing methods used by the FBI in this case readily satisfy Rule 702's reliability requirement. First, although PCR is a relatively new technology, it is based on sound scientific methods and it has quickly become a generally accepted technique in both forensic and non-forensic settings. Perhaps the strongest evidence on this point is the conclusion reached by the National Research Council's Committee on Forensic DNA Science that "the molecular technology [on which PCR is based] is thoroughly sound and ... the results are highly reproducible when appropriate quality-control methods *339 are followed."[20] NRC II, supra, at 23; see also Mange, supra, at 287 (noting PCR's "widespread and growing applications [in the field of molecular biology]"). Second, the tests used to type each of the 7 sites examined in this case were validated in a carefully constructed series of experiments and the results were later published in peer-reviewed publications.[21] Finally, the FBI followed detailed testing protocols and quality control procedures in this case that conform to industry standards.[22]
Notwithstanding the considerable evidence supporting a finding that the FBI's PCR test methods are scientifically valid, Shea argues that the DNA evidence must be excluded because the FBI's PCR tests will produce an unacceptably high percentage of erroneous results even if evidence samples are properly handled and the tests are properly performed. Shea bases this argument primarily on the testimony of Dr. Donald Riley.[23] Dr. Riley claims that the FBI's testing protocols could result in typing errors because the testing protocols specify incorrect amplification and typing temperatures. He also states that this problem is particularly significant with the amplification and typing of the DQ Alpha region. Because the control probes for both the DQ Alpha and Polymarker tests are intended to detect DQ Alpha alleles, Dr. Riley theorizes, the FBI's testing protocols could produce erroneous results on both tests.
I reject Dr. Riley's testimony for two reasons. First, although he claimed that he has tested his theory, he has not subjected his conclusions to peer review, nor has he described his test methods in sufficient detail to permit a conclusion that they are scientifically valid. Second, even if the testing protocols specify the wrong amplification and typing temperatures, Dr. Riley has offered no scientific support for his theory that this methodological flaw could produce false positive signals at the control probes on the DQ Alpha and Polymarker test strips. In the face of such poorly supported testimony, I have no difficulty in finding that the published validation studies relied on by the government persuasively establish the evidentiary reliability of the FBI's PCR testing protocols.[24]
Shea also argues that the DNA evidence should be excluded because PCR cannot reliably detect mixtures of more than one person's DNA. The government concedes that a mixture theoretically could result in the declaration of a false match. However, Richard Guerrieri,[25] one of the government's expert *340 witnesses, testified that such errors are exceedingly unlikely because an examiner will be able to identify a mixture from observable differences in the relative strengths of the signals indicated on the PCR test strips, except in extremely unusual circumstances. I reject Shea's argument because I find Mr. Guerrieri's testimony persuasive on this point.
Shea next argues that the DNA evidence must be excluded because the government did not establish that the FBI laboratory has an acceptably low PCR error rate.[26] Testing errors can occur either because a test has inherent limitations or because the people involved in collecting, handling or testing samples are not sufficiently skilled. See Edward J. Imwinkelried, Coming to Grips with Scientific Research in Daubert's "Brave New World": The Courts' Need to Appreciate the Evidentiary Differences Between Validity and Proficiency Studies, 61 Brook.L.Rev. 1247 (1995) (explaining the difference between a validation study which evaluates whether a test produces accurate results if performed properly and a proficiency study which evaluates a laboratory's ability to correctly perform the test). A laboratory's error rate is a measure of its past proficiency that is of limited value in determining whether a test has methodological flaws. Since Rule 702's reliability requirement focuses on the validity of the test rather than the proficiency of the tester, the absence of a laboratory error rate will rarely be dispositive if the rest of the evidence establishes that the test has been properly validated. In this case, the government produced substantial persuasive evidence to support its claim that its PCR tests are reliable. Accordingly, the absence of a known PCR error rate for the FBI laboratory does not warrant the exclusion of the government's evidence.[27]
Shea finally challenges the reliability of the DNA evidence by pointing to several alleged deficiencies in the FBI's evidence handling and quality control procedures. Shea contends that the FBI laboratory mishandled the evidence by packaging the dried blood samples in individual paper coin envelopes and storing them together. Dr. Riley theorizes that this practice is fatally flawed because DNA from one sample could migrate through a paper coin envelope and contaminate other similarly packaged samples. Shea also contends that the laboratory's quality control procedures are deficient because substrate control samples[28] were not taken and a positive control sample[29] was not tested for each possible allele. The government responds by noting that Shea failed to produce any scientific evidence to support Dr. Riley's contamination theory and by explaining that the laboratory's quality control procedures conform to industry standards.
I need not address the merits of Shea's arguments. Instead, I join the many *341 courts that have addressed similar issues by concluding that because such arguments concern the way in which a method is applied in a particular case rather than the validity of the method, they affect the weight that should be given to the evidence rather than its admissibility.[30]See, e.g., United States v. Beasley, 102 F.3d 1440, 1448 (8th Cir.1996); United States v. Hicks, 103 F.3d 837, 848 (9th Cir.1996); United States v. Chischilly, 30 F.3d 1144, 1154 (9th Cir.1994), cert. denied, ___ U.S. ___, 115 S.Ct. 946, 130 L.Ed.2d 890 (1995); United States v. Bonds, 12 F.3d 540, 563 (6th Cir.1993); United States v. Jakobetz, 955 F.2d 786, 800 (2d Cir.), cert. denied, 506 U.S. 834, 113 S.Ct. 104, 121 L.Ed.2d 63 (1992).
B. Random Match Probability
The government's estimate of a 1 in 200,000 random match probability is based primarily on information drawn from a PCR database comprised of DNA profiles for 148 Caucasians, 145 African Americans, 94 Southeastern Hispanics, and 96 Southwestern Hispanics.[31] Bruce Budowle, et al., Validation and Population Studies of the Loci LDLR, GYPA, HBGG, D7S8, and Gc (PM loci), Procedure, 40 Journal of Forensic Sciences 45, 50 (1995). Shea contends that this database is simply too small to be used reliably in estimating random match probabilities with the product rule.
The government cites a study published in a peer-reviewed journal to refute Shea's claim. Id. This study analyzes the government's database using several statistical tests in an effort to identify significant departures from Hardy-Weinberg and linkage equilibrium. The study states that the distribution of the various genotypes found at the 7 loci at issue in this case meet Hardy-Weinberg expectations and exhibit little evidence of deviation from linkage equilibrium. Accordingly, it concludes that "[t]he data demonstrate that valid estimates of a multiple locus profile frequency can be derived for identity testing purposes using the product rule under the assumption of independence."[32]Id. at 53.
Notwithstanding the study cited by the government, legitimate questions can be raised concerning the reliability of a random match probability that is estimated with the product rule from a database as small as the one used here. Because such databases are comprised of a limited number of samples, the possibility of random error ordinarily must be considered.[33] Further, legitimate *342 questions can be raised concerning the power of existing statistical methods to detect deviations from Hardy-Weinberg and linkage equilibrium when small databases are used. If random error is not accounted for and if the likely potential effects of factors such as population substructuring are not identified and addressed, a random match probability estimated with the product rule may be unreliable.
The recently released NRC II report addresses these issues by acknowledging the potential for error and suggesting several ways to conservatively account for the problem. First, the report describes alternative adjustments to the product rule to account for the systematic over-representation of homozygous genotypes that is caused by undetected population substructuring.[34] NRC II, supra, at 99-100. If, as is the case with most PCR-based systems, the method used to identify alleles does not present significant ambiguity, the report recommends that homozygous frequencies be determined by using P2 + P(1-P)θ rather than by P2 where P is the allele frequency and θ is the percentage of excess homozygosity that is expected because of undetected population substructuring. Id. at 122. After examining empirical data from several sources, the report concludes that a θ value of .01 will conservatively address the likely potential systematic effect of undetected population substructuring except for cases involving small, isolated populations, where a θ value of .03 may be appropriate.[35]Id. at 122. If an allele identification system such as one based on VNTRs is used where there is a potential that a heterozygous genotype may be misidentified as homozygous, the report recommends that homozygous genotype frequencies be calculated using 2P rather than P2. Id. at 122. The report concludes that these two methods will account in a conservative way for the likely systematic effect of undetected population substructuring. Id.
Undetected population substructuring and random error can also affect individual random match probability calculations in ways that are difficult to predict. NRC II, supra, at 112. Thus, the NRC II report also suggests a way of qualifying random match probability estimates to account for such uncertainties. After considering empirical data comparing genotype frequencies observed in a number of aggregate population databases with genotype frequencies found in known regional and ethnic subpopulation databases, the report concludes that likely uncertainties caused by random error and undetected population substructuring can be conservatively accounted for if the database used in calculating the random match probability contains samples from "at least several hundred persons" and the estimate obtained by using the product rule is qualified by stating that the true value is likely to be within a factor of 10 above or below the estimated value.[36]Id. at 156.
The government agreed to adjust its random match probability estimate in the manner suggested in the NRC II report.[37] Accordingly, *343 I consider whether the method used by the government's expert in estimating the probability of a random match, when adjusted in accordance with the recommendations contained in the NRC II report, satisfies Daubert's reliability standard.
Shea relies primarily on the testimony of Dr. William Shields[38] in claiming that the FBI's methodology for estimating the probability of a random match is unreliable even if it is adjusted to conform to the recommendations contained in the NRC II report. Dr. Shields challenged the FBI's methodology by claiming that: (1) a θ value of .01 is insufficient to capture the likely systematic effects of population substructuring; (2) the NRC II's recommended factor of 10 correction is based on VNTR data that cannot reliably be applied to the PCR loci at issue here; and (3) the PCR database used in this case is too small, even when judged by the standards of the NRC II report, for the factor of 10 correction to account for potential error. Rather than using the adjustment to the product rule suggested in the NRC II report, Dr. Shields proposed an alternative method of accounting for potential error.[39] Using his method, Dr. Shields claimed that the probability of a random match should be estimated at 1 in 49,000. If, as Dr. Shields suggests, a 95% confidence interval[40] is then calculated to account for the potential effect of random error, the bottom end of the range in his estimate would be 1 in 23,000, rather than the bottom range of 1 in 20,000 proposed by the government.
The government countered Dr. Shields' testimony with testimony from Dr. Martin Tracey.[41] Dr. Tracey (1) endorsed the use of both P2 + P(1-P)θ with a θ value of .01 and 2P as adjustments to homozygous genotypes, (2) opined that there is no reason to expect that the factor of 10 correction recommended in the NRC II report will be insufficiently conservative if it is applied to PCR loci, and (3) concluded that a database of 148 is sufficiently large to reliably permit the use of the factor of 10 correction recommended in the NRC II report.
Whether the adjustments to the product rule suggested in the NRC II report are sufficiently conservative and whether a database of 148 is of sufficient size to serve as the basis for a reliable random match probability estimate are important questions about which population geneticists can legitimately disagree. However, Rule 702 does not require scientific consensus. The government has produced a peer-reviewed study using accepted statistical methods to support its position that the estimation of a random match probability from the database used in this case will produce a reliable result. It has further qualified its estimate in accordance with the recommendations of a distinguished committee of scientists and academicians that included leading population geneticists as members. Under these circumstances, the concerns raised by Dr. Shields affect the weight that should be given to the evidence rather than its admissibility. See Bonds, 12 F.3d at 564 (substructuring *344 argument affects weight rather than admissibility); see also Jakobetz, 955 F.2d at 792.
C. Juror Confusion
Evidence that a defendant's DNA profile matches DNA extracted from an evidence sample suggests that the defendant cannot be excluded as a potential contributor, but it is of little value, standing alone, in proving the defendant's guilt. Giving the jury a random match probability estimate for the profile is one way of helping it assess the potential significance of a DNA profile match. However, because such evidence also has the potential to mislead, Rule 403 requires that the probative value of the evidence must be carefully balanced against the danger of unfair prejudice.
Shea argues that a jury would be so overwhelmed by evidence of a random match probability that it could not properly assess the possibility that a profile match is false unless a laboratory or industry error rate is calculated and combined with the random match probability estimate. Shea bases this argument on the following reasoning: (1) a random match probability estimate is meaningless if the declared DNA profile match is false; (2) the best evidence of whether a match is false in a particular case is the laboratory's false match error rate; (3) if the laboratory's false match error rate cannot be determined, the next best evidence is the industry's false match error rate; (4) jurors cannot understand the significance of a laboratory's error rate unless it is combined with the random match probability estimate. Because the FBI laboratory does not calculate a PCR false match error rate and the government refuses to combine what Shea suggests is the industry's PCR error rate with the random match probability estimate, Shea argues that the estimate is inherently misleading.
I reject Shea's argument because it is built on several flawed premises. First, I cannot accept Shea's contention that a laboratory or industry error rate is the best evidence of whether a test was properly performed in a particular case. Juries must decide whether a particular test was performed correctly based on all of the relevant evidence. This determination can never be precisely quantified because it will often depend in part on subjective factors such as the credibility of the person who performed the test. At best, evidence of a laboratory's past proficiency should be considered as one of several factors in making this important judgment.[42]See NRC II, supra, at 85-86 ("[t]he risk of error in any particular case depends on many variables (such as the number of samples, redundancy in testing, and analyst proficiency), and there is no simple equation to translate these variables into the probability that a reported match is spurious"). Shea's method for dealing with the probability of a false match is thus seriously flawed because it would deprive the jury of the opportunity to determine the probability of a false match based on all of the pertinent evidence.
Second, I am unconvinced by Shea's claim that a jury cannot properly assess the potential of a false match unless a false match error rate is calculated and combined with the random match probability estimate. Shea relies on testimony and research conducted by Dr. Jay Koehler[43] to support this contention. Although Dr. Koehler's research suggests that jurors could become confused if evidence of a false match error rate and a random match probability estimate are presented with little or no explanation, it does not support Shea's broader contention that jurors cannot be made to understand such evidence even if it is properly explained. See NRC II, supra, at 199 (noting that "[t]he argument that jurors will make better use of *345 a single figure for the probability that an innocent suspect would be reported to match never has been tested adequately"). In a real trial setting, the parties are given an opportunity to explain the significance of statistical evidence through expert testimony. Further, if a trial judge concludes that jurors could be confused by statistical evidence, the judge can deliver carefully crafted instructions to insure that the evidence is properly understood. Notwithstanding Dr. Koehler's research, I am confident that the concerns Shea raises can be properly addressed through expert testimony and, if necessary, clarifying jury instructions.
Shea next argues that a random match probability estimate is inherently misleading because the jury inevitably will confuse the probability of a random match with the potentially very different probability that the defendant is not the source of the matching samples. This type of incorrect reasoning is often referred to as the fallacy of the transposed conditional, or the prosecutor's fallacy. NRC II, supra, at 133. The probability of a random match is the conditional probability of a random match given that someone other than the defendant contributed the evidence sample. The potentially different probability that someone other than the defendant contributed the sample given the existence of a match can only be determined by considering all of the evidence in the case.[44] Shea argues, based on research conducted by Dr. Koehler, that the jury will inevitably confuse these two probabilities.
Although I acknowledge that a jury could become confused concerning the meaning and potential significance of a random match probability estimate, I am confident that the risk of confusion is acceptably small if the concept is properly explained. Moreover, because such an estimate can be extremely valuable in helping the jury appreciate the potential significance of a DNA profile match, it should not be excluded merely because the concept requires explanation. Accordingly, I decline to exclude the government's random match probability estimate pursuant to Rule 403.
IV.
After carefully considering Shea's motion to exclude the DNA evidence, I reached the following conclusions:
(1) PCR is a scientifically sound technology that can be extremely helpful in resolving questions of guilt or innocence. The theory and techniques used in PCR are sufficiently established that a court may take judicial notice of their general reliability. See Beasley, 102 F.3d at 1448 (taking judicial notice of general reliability of PCR testing); see also United States v. Martinez, 3 F.3d 1191, 1197 (8th Cir.1993) (taking judicial notice of general reliability of DNA testing), cert. denied, 510 U.S. 1062, 114 S.Ct. 734, 126 L.Ed.2d 697 (1994); Jakobetz, 955 F.2d at 799 (taking judicial notice of reliability of DNA testing).
(2) The PCR tests used in this case readily satisfy Rule 702's reliability requirement. Accordingly, disputes concerning the way in which the tests were conducted, while vitally important, are matters that should be left for the jury to resolve.
(3) Random match probability estimates calculated with the product rule provide an important means of placing the significance of a DNA profile match in an appropriate context. However, such estimates must be qualified to account for potential errors such as in the manner suggested by the NRC II report. The government satisfied this requirement.
(4) When the significance of a random match probability estimate is properly explained, the probative value of the evidence is *346 not substantially outweighed by the limited potential that jurors could be misled.
Accordingly, I denied the defendant's motion to exclude (document no. 15).
*347
*348
NOTES
[1] The information contained in this section is undisputed. Thus, I have relied on published sources to supplement testimony offered during the evidentiary hearing. See, e.g., Elaine J. Mange and Arthur P. Mange, Basic Human Genetics (1994); National Research Council, DNA Technology in Forensic Science (1992) ("NRC I"); Lorne T. Kirby, DNA Fingerprinting: An Introduction (1992); National Research Council, The Evaluation of Forensic DNA Evidence (1996) ("NRC II").
[2] I refer in this opinion to sites or loci rather than genes. Genes are sites on a DNA molecule containing sequences of base pairs that provide instructions used to produce something, usually a protein. Mange, supra, at 517. Genes are often found at polymorphic sites. However, the base pair sequences at many polymorphic sites have no known function.
[3] The term genotype is most often used to refer to an organism's entire genetic makeup. NRC II, supra, at 216. However, it can also be used to describe the combination of alleles at one or more loci. Throughout this opinion, I use the term to describe the alleles for corresponding sites at a single locus.
[4] RFLP targets sites on DNA molecules that are known to have different lengths because of variations in the number of times that a sequence of base pairs is repeated. Such sites are referred to as Variable Number Tandem Repeats ("VNTRs"). RFLP uses restriction enzymes to cut DNA into fragments at the boundaries of a studied site. The relative lengths of the alleles for the site are then identified by a process known as gel electrophoresis. Mange, supra, at 306; NRC II, supra, at 65-67. Electrophoresis is described later as it is also used in typing one of the sites at issue in this case.
[5] DQ Alpha is located on chromosome six. GYPA and Gc are both located on chromosome four. LDLR is located on chromosome nineteen. HBGG is located on chromosome eleven. D7S8 is located on chromosome seven and D1S80 is located on chromosome one.
[6] For example, there are eight different alleles for the DQ Alpha site: 1.1; 1.2; 1.3; 2; 3; 4.1 and 4.2/4.3. The DQ Alpha test strip has a composite probe for alleles 1.1, 1.2 and 1.3 (it appears as 1 on the test strip). It also has separate probes for alleles 1.1 and 1.3 A positive response for the 1.2 allele is inferred from a positive response on the 1 probe and the absence of a response on either 1.1 or the 1.3 probes. The test contains separate probes for the 2, 3, and 4.1 alleles. It uses a composite probe for the 4.2 and 4.3 alleles and does not otherwise attempt to distinguish between the two alleles.
[7] The sum of the allele frequencies for a site totals 1. Thus, if a site has two alleles with equal frequencies, each allele will have a frequency of .5.
[8] For example, if a site has two alleles with equal frequencies, A and a, the genotype frequencies will be: AA = .25 (or .5 × .5); aa = .25 (or .5 × .5); and Aa = .5 (or 2(.5 × .5)). The product of allele frequencies for heterozygous genotypes must be doubled because the genotype Aa can be comprised either of an A from the father and an a from the mother, or vice versa.
[9] The distribution of alleles in a population will occur in Hardy-Weinberg proportions under appropriate conditions because genotypes are formed in accordance with the first law of genetics. This law, which is also known as the law of segregation, recognizes that observable traits are the product of two alleles which are segregated in reproductive cells so that a child inherits one allele from each parent. Mange, supra, at 52-53.
[10] Thus, if a sample has three genotypes with equal frequencies of .5, the probability of a random match will be 1 in 8 (.5 × .5 × .5 = .125 or 1/8 ).
[11] To understand why this is so, consider an extreme example: if a site has two alleles with equal frequencies, A and a, but no mating occurs with any person having the homozygous genotype aa, genotype frequencies in subsequent generations will quickly begin to change from the frequencies that would be predicted using the Hardy-Weinberg law.
[12] People v. Collins, 68 Cal.2d 319, 66 Cal.Rptr. 497, 438 P.2d 33 (1968) is frequently cited as an example of how dependence skews the results obtained by using the product rule. In that case involving eyewitness identification, the prosecutor applied the product rule to variables that were not independent. The prosecutor used individual probabilities of a man with mustache (25%), a Negro man with beard (10%), a girl with ponytail (10%), a girl with blond hair (33%), a partly yellow automobile (10%) and an interracial couple in car (001%), and using the product rule arrived at a 1 in 12 million random match probability. Because the characteristics were not independent, the product rule yielded a drastically exaggerated result. Id. at 501, 438 P.2d at 37.
[13] Linkage equilibrium for sites on different chromosomes is possible under proper conditions because of the second law of genetics. This law, which is also known as the law of independent assortment, holds that chromosome pairs sort randomly during the process of reproductive cell formation. Mange, supra, at 518. Thus, parents with an Aa genotype on the first chromosome pair and a Bb genotype on the second chromosome pair will randomly produce reproductive cells with the following combinations of alleles for both sites AB, Ab, aB, ab. Random mating produces linkage equilibrium for these two sites because they are on different chromosomes.
Linkage equilibrium also is possible under proper conditions for sites on the same chromosome because of a phenomenon known as crossing over. Crossing over occurs when corresponding parts of a chromosome pair are exchanged during the production of reproductive cells. If equilibrium conditions persist in a population over a number of generations, crossing over will result in the independence in the population of genotypes on the same pair of chromosomes. Mange, supra, at 47, 196; NRC II, supra, at 64.
[14] I address Shea's claim that the evidence is too misleading to assist the jury in ruling on his Rule 403 objection. Shea does not otherwise argue that the evidence is inadmissible under Rule 702.
[15] Evidentiary reliability must be distinguished from scientific reliability. The latter concept concerns the extent to which a test produces consistent results whereas the former concept depends more on scientific validity; i.e., does a principle support what it purports to support. Daubert, 509 U.S. at 590 n. 9, 113 S.Ct. at 2795 n. 9.
[16] I treat the concept of fit as an aspect of Rule 702's reliability requirement because a scientific opinion cannot fit the facts of the case even if it is based on scientifically sound methods unless a scientifically valid connection also exists between the opinion and the issue it is intended to address.
[17] The concept of general acceptance was first applied to expert testimony in Frye v. United States, 293 F. 1013, 1014 (D.C.Cir.1923). There, the court stated that "while courts will go a long way in admitting expert testimony deduced from a well-recognized scientific principle or discovery, the thing from which the deduction is made must be sufficiently established to have gained general acceptance in the particular field in which it belongs." Id. at 1014.
[18] The Third Circuit has identified additional factors such as "the degree to which the expert testifying is qualified, the relationship of a technique to `more established modes of scientific analysis,' and the `non-judicial uses to which the scientific techniques are put.'" Paoli II, 35 F.3d at 742 (internal quotations omitted). The Ninth Circuit has similarly suggested that courts can consider "whether the experts are proposing to testify about matters growing naturally and directly out of research they have conducted independent of the litigation, or whether they have developed their opinions expressly for the purpose of testifying." Daubert v. Merrell Dow Pharmaceuticals, Inc., 43 F.3d 1311, 1317 (9th Cir.), cert. denied, ___ U.S. ___, 116 S.Ct. 189, 133 L.Ed.2d 126 (1995).
[19] In addressing Shea's arguments, I am mindful that the government bears the burden of proving that the predicates for admission have been satisfied by a preponderance of the evidence. Daubert, 509 U.S. at 592 n. 10, 113 S.Ct. at 2796 n. 10.
[20] The general acceptance of PCR technology is further underscored by the fact that at least two federal circuit courts and at least 16 state courts have approved the admission of expert testimony based on PCR analysis. See United States v. Beasley, 102 F.3d 1440, 1448 (8th Cir.1996) (concluding that courts in the 8th Circuit can take judicial notice of the general reliability of PCR testing); United States v. Hicks, 103 F.3d 837, 844 (9th Cir.1996); United States v. Lowe, No. 95-10404-PBS, 1996 WL 774905, at *16 (D.Mass. Dec.10, 1996)(collecting state court cases).
[21] Catherine Theisen Comey and Bruce Budowle, Validation Studies on the Analysis of the HLA DQα Locus Using the Polymerase Chain Reaction, 36 Journal of Forensic Sciences 1633 (1991); Bruce Budowle, et al., Validation and Population Studies of the Loci LDLR, GYPA, HBGG, D7S8, and Gc (PM loci), and HLA-DQα Using a Multiplex Amplification and Typing Procedure, 40 Journal of Forensic Sciences 45 (1995); Susan Cosso and Rebecca Reynolds, Validation of the AmpliFLP D1S80 PCR Amplification Kit for Forensic Casework Analysis According to TWGDAM Guidelines, 40 Journal of Forensic Sciences 424 (1995).
[22] The DNA Identification Act of 1994, 42 U.S.C.A. § 14131(a) (West 1995), requires the Director of the FBI to convene an advisory board to develop quality assurance standards for DNA testing. Until such standards are developed and approved by the Director, the FBI is obligated to follow standards developed by the Technical Working Group on DNA Analysis Methods (TWGDAM), a group comprised of analysts working in government and private laboratories. The FBI's PCR testing protocols and quality control standards conform to TWGDAM guidelines.
[23] Dr. Riley is an Associate Professor at the University of Washington's School of Medicine and School of Public Health. He holds a Ph.D. in biochemistry.
[24] I express no opinion concerning the admissibility of Dr. Riley's trial testimony on this point because the government did not seek to exclude his testimony pursuant to Rule 702.
[25] Guerrieri is a forensic scientist employed by the FBI. He has also worked for Roche Biomedical Laboratories as the assistant director of Roche's Forensic Identity Laboratory, and for the Commonwealth of Virginia as a forensic scientist in the first state DNA laboratory in the country. He has performed over one thousand PCR DNA typing tests. He holds a Master of Science in forensic chemistry.
[26] Mr. Guerrieri testified that the FBI's PCR laboratory follows TWGDAM standards by requiring its PCR examiners to submit to two open external proficiency tests and one blind proficiency test per year. Although he claims that no FBI examiner has ever failed a PCR proficiency test, he stated that the FBI does not calculate a laboratory error rate because its current proficiency testing program does not produce enough samples to serve as the basis for calculating a meaningful error rate and it would be impractical to develop a proficiency testing program that could produce a meaningful calculation. See generally, NRC II, supra, at 85-86 (discussing difficulties in attempting to calculate a laboratory error rate).
[27] If a laboratory failed to adhere to industry proficiency testing standards, it might call into question the validity of the laboratory's methods. See NRC II, supra, at 88 (recommending that laboratories establish proficiency testing programs). I need not address this issue, however, since it is undisputed that the FBI's proficiency testing program conforms to industry standards.
[28] A substrate control tests the substance from which a sample is obtained. For example, if an evidentiary blood sample is obtained from a steering wheel, a substrate control would test a different part of the steering wheel to detect DNA from another source which would compromise the evidentiary sample.
[29] A positive control is DNA of a known type. The FBI uses positive controls, but does not use a positive control for each possible allele.
[30] Shea also argues that the PCR test results should be excluded pursuant to Fed.R.Evid. 901 because the government failed to sufficiently demonstrate that the tests produced an accurate result in this case. In addition to claiming that PCR tests are inherently unreliable, Shea argues that the test results are invalid because the DQ Alpha test strips used in typing Shea's blood and a positive control sample do not show a positive response at the control probes. I reject Shea's argument because I am persuaded by Mr. Guerrieri's contrary testimony. Although it is not determinative, I also note that I saw a positive response at the DQ Alpha test strip for Shea's blood sample when I inspected the strip. I could not independently determine whether the test strip for the positive control sample showed a positive response because the government produced only an inconclusive photograph of this test strip.
[31] Data is collected for separate racial groups because significant population substructuring is known to exist for such groups. The NRC II report recommends that random match probabilities should be calculated for all potentially applicable racial groups when the race of the perpetrator is unknown. NRC II, supra, at 122. However, the report also recognizes that it may be appropriate to provide only the estimate for the major racial group that gives the largest probability of a match. NRC II, supra, at 114. In this case, the report detailing the PCR typing concludes that, "[t]he probability of selecting an unrelated individual at random having the same DQ Alpha, PM, and D1S80 types ... is approximately 1 in 700,000 in Blacks, 1 in 200,000 in Caucasians, 1 in 600,000 in Southeastern Hispanics, and 1 in 1.3 million in Southwestern Hispanics." The government informed the jury only of the random match probability estimate for Caucasians since the match probability is highest for this group. Shea did not challenge the government's position on this point.
[32] The government also relies in part on a peer-reviewed study of a somewhat larger database to support its claim that the distribution of genotypes for the D1S80 locus meet Hardy-Weinberg expectations. Bruce Budowle, et al., D1S80 Population Data in African Americans, Caucasians, Southeastern Hispanics, Southwestern Hispanics, and Orientals, 40 Journal of Forensic Sciences 38, 40 (1995).
[33] Random error is error that can occur by chance because a database does not contain the entire population being studied. Daniel L. Rubinfeld, Reference Guide on Multiple Regression, in Moore's Federal Practice: Reference Manual on Scientific Evidence 415, 466 (1994).
[34] Substructuring also usually produces an under-representation of heterozygous genotype frequencies from those that would be predicted using the Hardy-Weinberg law. NRC II, supra, at 122. Since this effect will tend to favor defendants, however, the report does not recommend any adjustment to the formula used to estimate heterozygous genotype frequencies.
[35] The report alternatively states that "[a] more conservative value of θ = .03 might be chosen for PCR-based systems in view of the greater uncertainty of calculations for such systems because of less extensive and less varied population data than for VNTRs." NRC II, supra, at 122. This even more conservative approach is not offered as a formal recommendation. Id.
[36] The report notes that the uncertainty can be greater for very small profile frequencies. Id. at 160. Further, the factor of 10 qualification obviously is not of great value in qualifying random match probabilities that are greater than 10-3.
[37] The genotypes for the D1S80 site and 5 of the remaining 6 sites examined in this case were found to be heterozygous. When the genotype frequency for the single homozygous locus is recalculated using a θ value of .01, it does not significantly affect the government's random match probability estimate because the FBI routinely rounds down when calculating the probability of a random match and that rounding process more than captured the effect of the adjustment that needed to be made to the single homozygous genotype frequency. When the NRC II's factor of 10 adjustment is applied to the random match probability estimate, it results in a range of possible results of from 1 in 20,000 to 1 in 2,000,000.
[38] Dr. Shields is a professor at the State University of New York's College of Environmental Science and Forestry. He holds both a Masters and a Ph.D. in Zoology and has written extensively on inbreeding and population structure, particularly regarding birds.
[39] The NRC II report identifies equations that can be used in estimating genotype frequencies when the person who contributed a crime scene sample is known to come from the same subpopulation as the suspect. NRC II, supra, at 113-16. Dr. Shields argues that these equations should be used in all cases. Moreover, he claims that a θ value of .05 rather than .01 or .03 should be used in all cases. Once genotype frequencies are calculated using these equations, Dr. Shields claims, the adjusted frequencies can be multiplied using the product rule and a confidence interval can be calculated to account for random error. The NRC II report considered a similar approach and concluded that it is "unnecessarily conservative." Id. at 114.
[40] Confidence intervals qualify a conclusion in an effort to account for the effect of random error by describing a range of possible results that is expected to contain the true result a given percentage of the time. Id. at 146.
[41] Dr. Tracey is a Professor of Biological Sciences at Florida International University with a Ph.D. in biology. He has written extensively in the field of population genetics and has served on the editorial boards of a number of peer-reviewed journals.
[42] The parties assume that error rate information is admissible at trial. This assumption may well be incorrect. Even though a laboratory or industry error rate may be logically relevant, a strong argument can be made that such evidence is barred by Fed.R.Evid. 404 because it is inadmissible propensity evidence. Imwinkelreid, supra, at 1271-81. I need not determine whether error rate information is ever admissible, however, because the point is not essential to my analysis, and the government did not object to Shea's effort to introduce error rate information at trial.
[43] Dr. Koehler is an Associate Professor of Behavioral Decision Making at the University of Texas. He holds a Masters and Ph.D. in behavioral science.
[44] To illustrate how these two probabilities can be very different, consider a hypothetical case where: (1) the defendant's DNA profile is correctly found to match DNA left by the perpetrator at the crime scene during the commission of the crime; (2) the random match probability estimate for the observed DNA profile is 1 in 1,000,000; and (3) undisputed evidence establishes that the defendant did not commit the crime. In this hypothetical case, the random match probability estimate is 1 in 1,000,000 even though the probability that someone other than the defendant contributed the evidence sample is 1. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581547/ | 42 So.3d 233 (2010)
FERRELL
v.
FLORIDA DEPT. OF CHILDREN & FAMILIES.
No. SC10-1345.
Supreme Court of Florida.
July 12, 2010.
Decision Without Published Opinion Review dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581451/ | 42 So. 3d 245 (2010)
HARRIS
v.
STATE.
No. 5D09-2072.
District Court of Appeal of Florida, Fifth District.
August 10, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583258/ | 682 F. Supp. 1323 (1988)
HARDY, Daniel W. and Wilson, Ernest G.
v.
INTERNATIONAL BROTHERHOOD OF BOILERMAKERS, IRON SHIP BUILDERS, BLACKSMITHS, FORGERS AND HELPERS, and Abbott, Ande.
Civ. A. No. 86-4520.
United States District Court, E.D. Pennsylvania.
February 29, 1988.
*1324 *1325 Judith Brown Chomsky, Ira Jay Katz, Philadelphia, Pa., for plaintiffs.
William Einhorn, Sagot & Jennings, Philadelphia, Pa., Steve A.J. Bukaty, Blake & Uhlig, P.A., Kansas City, Kan., for defendants.
MEMORANDUM
CLIFFORD SCOTT GREEN, District Judge.
Plaintiffs Daniel W. Hardy and Ernest G. Wilson are the former president and executive secretary respectively of Local Lodge 802 ("Lodge 802"), the collective bargaining representatives of ship building employees at the Pennsylvania Ship Building Company ("Penn Ship") in Chester, Pennsylvania. Lodge 802 is a subordinate union branch of the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths Forgers and Helpers ("International"). The defendants are International and Ande Abbott, the former appointed trustee of Local 802.
In this action, plaintiffs challenge International's imposition and administration of a trusteeship over Lodge 802 from May 19, 1986 through December 31, 1986 and subsequent internal union proceedings against plaintiffs as violations of Title III of the Labor Management Reporting and Disclosure Act ("LMRDA" or "the Act"), 29 U.S. C. § 461 et seq. and International's Constitution. As relief, plaintiffs seek an order (1) declaring the trusteeship invalid[1], (2) declaring defendants' removal of plaintiffs from office was invalid and reinstating the plaintiffs to their respective offices, (3) setting aside International's decision on the internal union charges and (4) awarding plaintiffs compensatory and punitive damages, costs, and attorney fees.
To date, plaintiffs have filed several motions with this court. Currently pending are three motions by plaintiff: a motion for summary judgment, a motion for summary judgment on internal union charges and a motion for a preliminary injunction on internal union charges. In turn, defendants have filed a motion for summary judgment. The record before the court consists not only of the pleadings, but also of the depositions, affidavits and hearing record on the motion for preliminary injunctive relief. This court has jurisdiction over this matter pursuant to 28 U.S.C. § 1337, and 29 U.S.C. §§ 185, 464(a) and (b).
Undisputed facts, as set forth in the proposed pretrial order and elsewhere in the pleadings, include the following: Plaintiffs Hardy and Wilson assumed their offices as president and executive secretary of Lodge 802 on October 1, 1984. Their terms were scheduled to end on June 30, 1987. At the time plaintiffs assumed office Lodge 802 was facing financial difficulties. By the beginning of 1986, Lodge 802 owed approximately $35,000 in per capita tax to International, notwithstanding the fact that the lodge members had paid their dues to the lodge, and an additional $17,000 in unpaid real estate taxes and penalties on its building. The growing arrearage in per capita tax threatened to jeopardize Lodge 802's standing with International. Normally, such taxes, paid from membership dues, went to support the activities of International *1326 on behalf of all subordinate lodges. One such activity was International's Consolidated Convention which occurred every five years and was scheduled to take place in August, 1986. Because of the outstanding per capita tax arrearages, Lodge 802 was not entitled to participate in the convention.
The parties agree that the financial health of Lodge 802 has long been intertwined with that of Penn Ship. In prior times of full employment at the shipyard, when Lodge 802 had several thousand members, the Lodge employed a full-time business manager, and paid lost time compensation of four hours per day to two chief stewards for services rendered. This manpower was considered necessary to service the members of the bargaining unit. However, when Penn Ship began to experience difficult economic times in 1985 and resorted to mass layoffs, Lodge 802 felt the impact through falling membership rolls. During this financial crisis, it appears that union members made several unsuccessful attempts to persuade and direct Hardy and Wilson to undertake certain cost-cutting measures such as having secretary Wilson and Chief Steward Frank Sutton return to work full-time in the shipyard rather than to continue to draw salaries from the limited funds of the union. This issue was also the focus of several communications occurring between plaintiffs and the International.
Defendants established a trusteeship over the Lodge on May 19, 1986. Mr. Abbott delivered to Hardy on May 19, 1986, and to Wilson on May 20, 1986, copies of a telegram from International President Charles W. Jones. The telegram advised all lodge officers that "[a]s a consequence of the problems which have arisen relating to the administration of the affairs of Lodge 802," President Jones was exercising his emergency powers pursuant to Article XVIII, section 3 of the Constitution to (1) appoint Ande Abbott as a trustee over Local 802, (2) suspend Hardy and Wilson from their offices "immediately and indefinitely" and (3) appoint a hearing officer with regard to the trusteeship.
Trustee Abbott, upon delivering the telegram to Hardy, commented that the only reasons he was aware of for the trusteeship were the per capita tax owed to International and complaints received by International about "what was happening" in the Lodge.
On or about May 20, 1986, Trustee Abbott gave Hardy a copy of the "Official Hearing Notice" which set the time and place of the trusteeship hearing. Hardy discussed the trusteeship hearing with Abbott on or about May 28 at the Lodge.
The trusteeship hearing took place on June 2, 1986. Plaintiffs appeared, testified and presented rebuttal evidence. The hearing officer did not permit plaintiffs or any other person to cross-examine witnesses.
Following the hearing, International President Jones sent ballots to members of the Executive Council of International requesting their vote on whether to continue the trusteeship. By September 3, 1986 a majority of the Executive Council had voted in favor of continuing the trusteeship.[2]
On September 16, 1986, Trustee Abbott filed internal union charges against plaintiffs, alleging that they violated Article XVII, section 1(g) of the Constitution by "mishandling, misappropriating or otherwise misusing union funds or properties." The particular facts cited as a basis for the charges included Hardy's allegedly wrongful salary overpayments, in excess of the *1327 salary prescribed by the local's by-laws, to Wilson and lost time payments to Chief Steward Sutton.
A hearing on the internal union charges against plaintiffs was held on October 8, 1986. International officer Don Lacefield presided over the hearing, which the parties agree was "conducted in strict conformity" with the International Constitution. (Pretrial Order, p. 16). Sometime later that month the Executive Council found that plaintiffs had violated the Constitution and Lodge 802's by-laws with regard to the payments to Wilson. By order of the Executive Council, plaintiffs were removed from office, prohibited from attending membership meetings and barred from candidacy for office for a period of five years. The Council also fined Wilson an amount equal to the alleged overpayments. The International President notified plaintiffs of the decision by letter dated November 11, 1986.
Sometime between October 27 and 29, the Executive Council voted to terminate the trusteeship over the Lodge effective December 31, 1986. Elections were held in December 1986 for president and executive secretary to serve the remainder of plaintiff's terms in office. The new officers assumed office on December 31, 1986, the effective date of the trusteeship's termination.
Although plaintiffs' second amended complaint sets out thirteen separate counts, the claims asserted fall into two broad categories: (1) that the trusteeship was not properly imposed, and (2) that the internal union disciplinary charges and finding of guilt were not proper. For the reasons stated below, summary judgment will be entered in defendants' favor and against plaintiffs.
I.
Under the Federal Rules of Civil Procedure, summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Rule 56(c). Summary judgment "is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed `to secure the just, speedy, and inexpensive determination of every action.'" Celotex Corp. v. Catrett, 477 U.S. 317, 106 S. Ct. 2548, 2555, 91 L. Ed. 2d 265 (1986). As the Court stated in Celotex, "the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 2552-53.
Hence, unless the facts and evidence of the case viewed in a light most favorable to the nonmoving party can sufficiently establish the essential elements of said party's case, the trial court must grant the movant's request for summary judgment. Moreover, in conformity with the Court's decision in Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S. Ct. 2505, 2512-14, 91 L. Ed. 2d 202 (1986), a trial court in ruling on a motion for summary judgment must also take into account the standard of proof relevant to a trial on the merits.
II.
Validity of the Trusteeship
Where a labor organization imposes a trusteeship over a member local, "in conformity with the procedural requirements of its constitution and bylaws and authorized or ratified after a fair hearing" said trusteeship is presumed valid. 29 U.S. C. § 464(c); Plentty v. Laborers' International Union of North America, 302 F. Supp. 332, 337 (E.D.Pa.1969). Litigants seeking to challenge trusteeships shielded by this statutory presumption must do so by presenting "clear and convincing proof" that the trusteeship was not imposed for a proper purpose as defined by the Act. Id.
A. Compliance with International's Constitution and Bylaws.
Article XVIII of the Constitution permits International to summarily impose a trusteeship in emergency situations "imminently *1328 threatening the welfare, funds or property of the subordinate body" as long as a hearing is held within 15 days."
Although holding a hearing prior to the imposition of a trusteeship is the preferred and normal method for imposing a trusteeship, due process is satisfied in emergency situations where a hearing is scheduled for the earliest practicable date thereafter. Local U. 13410, UMW v. United Mine Workers, 475 F.2d 906, 915 D.C. Cir.1973).
Given the level of deference accorded to an international's enforcement of the provisions of its constitution this court must uphold an international's finding of an emergency where the acting official who imposed the trusteeship "could reasonably believe that an emergency situation does not allow time for [a prior] hearing." Local Union 13410, 475 F.2d at 913. See also Retail Clerks Union, Local 770 v. Retail Clerks International Association, 479 F.2d 54, 55 (9th Cir.1973) (holding that district court has discretion to determine whether it could reasonably be said that an emergency exists) (emphasis added).
It is undisputed that (1) the local was in financial difficulties, a fact known to plaintiffs and defendants (2) under the Constitution, Lodge 802 was not eligible to participate in the convention so long as an outstanding per capita tax arrearage existed, (3) the arrearage existed notwithstanding payment of dues by local lodge members, (4) at least one meeting of the lodge to address these financial issues was cancelled by plaintiffs contrary to lodge procedures and (5) the International President had received complaints concerning these matters, and the alleged failure of plaintiffs to conform to democratic procedures, and to promptly process grievances. Given this information, it is clear that President Jones could reasonably believe that an emergency existed and lawfully impose a trusteeship prior to hearing.
B. Fair Hearing & Adequacy of Notice.
With regard to the hearing on the continuation of the trusteeship held on June 2, 1986 ("trusteeship hearing"), plaintiffs challenge both the adequacy of the notice and the fairness of the proceedings. Plaintiffs contend that they were denied notice with regard to the subject matter of the trusteeship hearing. Hence they argue they were denied a full and fair opportunity to prepare for trial and argue against the trusteeship.
However, it is undisputed that International President Charles Jones notified plaintiffs in his telegram of May 19, 1986 that "[a]s a consequence of the problems which have arisen relating to the administration of the affairs of Lodge 802, I am herewith using the emergency powers vested in me under Article Eighteen, Section Three ... to place Lodge 802 under emergency trusteeship effective May 19, 1986." Mr. Jones thereafter recited from the Constitution the various grounds for the imposition of a trusteeship:
Secession or threatened secession; dissolution or threatened dissolution, dissipation or loss of funds or assets or financial malpractice or corruption or threat thereof; violation or treatened [sic] violation of Collective Bargaining Agreements; the deprivation of democratic procedures and other activities constituting a violation of this constitution and threatening the welfare of the subordinate body membership of the International Brotherhood ...
Besides this telegram, plaintiffs received individual notice of the time and place of the hearing and discussed the hearing with Trustee Abbott. Nevertheless, plaintiffs argue that the notice given them on the trusteeship hearing was inadequate.
Plaintiffs have produced no evidence which would support a finding of inadequate notice. The focus of the June 2, 1986 hearing was not the conduct of the plaintiffs but rather the state of Local 802. Plaintiffs were not themselves on trial and thus the type of detailed written notices urged by plaintiff was not required by law or the constitution of the International.
Plaintiffs also argue that the unavailability of cross-examination of witnesses denied them a fair hearing. However, plaintiffs' claim to a procedural entitlement to cross-examination at the trusteeship *1329 hearing is unsupported by statute or case law. Although such hearings have to comply with due process, there is no requirement that they possess all the trappings of formal judicial proceedings. See Luggage Workers, Local 167 v. International Leather Goods, Plastics & Novelty Workers' Union, 316 F. Supp. 500, 508 (D.C.Del. 1970) (fair hearings do not rise to the level of judicial proceedings with rigid rules of pleading). Accord, Local Union 1983, IB-PAT C.A.P.E. AFL-CIO of Cape May County, N.J. v. International Brotherhood of Painters and Allied Trades, 598 F. Supp. 1056 (D.C.N.J.1984) (all formalities need not be observed); Tam v. Rutledge, 475 F. Supp. 559, 569 (D.Hawaii 1979); Schonfeld v. Raftery, 271 F. Supp. 128, 146 (S.D.N.Y.), aff'd 381 F.2d 446 (2d Cir.1967).
As observed by the court in Tam v. Rutledge, "[t]he test of the adequacy of a fair hearing is not whether it meets the requirements of an error free judicial trial but whether it was conducted in reasonable good faith as an approximate effort to achieve its objective." 475 F.Supp. at 569.
The trusteeship hearing, despite the absence of an opportunity for any person to cross-examine witnesses did comport with the LMRDA's guarantee of a fair hearing. Plaintiffs testified extensively at the hearing, and utilized the opportunity provided by the hearing officer to present rebuttal evidence. Moreover, plaintiffs' counsel by stipulation admits that plaintiffs had a full and fair opportunity to state their case, and that their objection is limited to the lack of opportunity to cross-examine witnesses.
C. Purpose of the Trusteeship.
Plaintiffs also challenge the trusteeship on the ground that International imposed it for improper reasons.[3] However, in accordance with federal law this court must presume the validity of the trusteeships imposed by an international in the absence of "clear and convincing proof that the trusteeship was not established or maintained in good faith" for one of the valid purposes specified by the Act. 29 U.S.C. § 464(c).[4]
Title III, § 302 of the Act, 29 U.S.C. § 462 provides:
Trusteeships shall be established and administered by a labor organization over a subordinate body only in accordance with the constitution and by-laws of the organization which has assumed trusteeship over the subordinate body and for the purpose of correcting corruption or financial malpractice, assuring the performance of collective bargaining agreements or other duties of a bargaining representative, restoring democratic procedures, or otherwise carrying out the legitimate objects of such labor organization.
In challenging International's appointment of a trustee over Lodge 802, plaintiffs argue that the real purpose behind International's action was not one of the legitimate purposes of § 462. Rather, they contend, the trusteeship was imposed (1) because plaintiffs opposed the slate of delegates favored by International to go to the International Convention and (2) in retaliation for plaintiffs initiation of this action against International.
The imposition of the trusteeship did not violate the Constitution or by-laws of the local, and plaintiffs on summary judgment have produced no evidence which would support a finding that the hearing was *1330 unfair. Plaintiffs in order to succeed on their claim must present clear and convincing proof of bad faith or illicit purpose. 29 U.S.C. § 464(c). Here, plaintiffs rely on their own opinions and beliefs, but point to no evidence that would satisfy their burden to establish improper purpose by clear and convincing proof.
The fact that plaintiffs challenged the International president and the slate of officers he supported is insufficient standing alone to meet plaintiff's burden, particularly, where as here, the financial disarray of the local is undisputed.
III.
Internal Union Charges
Plaintiffs challenge the internal union charges filed against them and the sanctions imposed on the following grounds: (1) that the charges filed were untimely and thus in violation of the International's Constitution, (2) that the charges were filed in bad faith and for a retaliatory purpose and (3) that the final verdicts against plaintiffs were not supported by the evidence.
Article XVII of the Constitution governs disciplinary proceedings, trials and appeals. It reads in pertinent part:
Section 1. The basis of charges against officers or members of a subordinate body, against officers of the International Brotherhood or against a subordinate body itself shall include, but shall not be limited to, any one or more of the following offenses:
. . . . .
(g) mishandling, misappropriating or otherwise misusing union funds or properties.
. . . . .
Section 2. (a) Charges of violation of this Constitution or subordinate body By-Laws may be made by any member in good standing who has knowledge of the alleged violation. Charges shall at all times be made in good faith and within sixty (60) days after the date that the alleged violation occurred. However, this time limit will not apply to those charges wherein the basic facts and evidence pertaining thereto could not be accumulated or made known within that period of time. In no event will any charge be processed which is based on an alleged violation occurring more than one (1) year prior to the filing of such charge except that this time limit shall not apply to any charge alleging a violation of Section 1(g) of this Article. ... Charges shall be set forth in writing and a copy of the charges served upon the individual or body being charged by registered or certified mail, with return receipt requested to last known address, and a copy thereof filed with the President of the Local Lodge and the International President. Charges shall be set forth with sufficient definiteness to inform the accused of the nature and circumstances of the violations complained of, together with a reference to the particular subsection of Section 1 of this Article under which the charges were brought. If the charges are not filed in conformance with this paragraph, the International President is authorized to dismiss said charges.
Trustee Abbott notified President Wilson by letter dated September 16, 1986, sent certified mail return receipt requested, that internal union charges had been filed against him for "mishandling, misappropriating or otherwise misusing union funds or properties" in violation of § 1(g) of International's Constitution. A four page attachment accompanied the letter and provided a summary of the particular facts which allegedly warranted such a charge. A hearing was held on October 8, 1986 and plaintiffs at that time were permitted to confront and cross-examine witnesses.
Plaintiffs first attack the charges filed against them as untimely, and point for support to the requirement of § 2 that "[c]harges shall at all times be made in good faith and within sixty (60) days after the date that the alleged violation occurred." Since the charges were filed on September 16, 1986, more than sixty days after the June 2, 1986 trusteeship hearing, plaintiffs contend that the charges were invalid. Plaintiffs also maintain that these charges do not fall within the exception to the 60 day limit provided in § 2 for "those charges wherein the basic facts and evidence pertaining thereto could not be accumulated *1331 or made known within that period of time." Indeed, it is undisputed that Trustee Abbott must have known about alleged salary overpayments to Wilson and lost time compensation to Chief Steward Frank Sutton at the time of the June 2, 1986 trusteeship hearing.
In response to plaintiffs' argument of untimeliness, defendants do not rely upon the lack of knowledge exception to § 2. Rather they insist that the § 2 time bar is inapplicable to charges brought pursuant to § 1(g) relating to the mishandling and misappropriation of union funds. This interpretation, they assert, is consistent with both past practice by International as well as the following language of the constitution: "In no event will any charge be processed which is based on an alleged violation occurring more than one (1) year prior to the filing of such charge except that this time limit shall not apply to any charge alleging a violation of § 1(g) of this Article." Article XVII, § 2 Constitution (emphasis added). Defendants argue that this court should defer to this interpretation by International.
Judicial deference to an international union's reasonable interpretation of its constitution is a longstanding policy of this circuit. Local 334 v. United Association of Journeymen, 669 F.2d 129, 132 (3d Cir. 1982); Lewis v. American Federation of State, County and Municipal Employees, 407 F.2d 1185, 1191-92 (3d Cir.1969).
Other circuits have followed the same principle. In Monzillo v. Biller, 735 F.2d 1456, 1458 (1984), the D.C. Circuit declared:
An interpretation of a union constitution rendered by officials of a labor organization is entitled to considerable deference by a reviewing court and should not be overruled unless the court finds that the interpretation was unreasonable or made in bad faith.
See also Newell v. International Brotherhood of Electrical Workers, 789 F.2d 1186 (5th Cir.1986); Taylor v. Great Lakes Seamen's Union, Local 5000, United Steelworkers of America, 701 F.2d 590 (6th Cir.1983); Busch v. Givens, 627 F.2d 978, 981 (9th Cir.1980).
Plaintiffs contend that "[t]he only reasonable interpretation" of the language contained in Article XVII, § 2 "is that a § 1(g) violation may be prosecuted within sixty days after it becomes known, even if it does not become known for over a year, whereas other violations may be prosecuted only if they become known within a year after they were committed." (Plaintiffs' Brief in Support of Motion for Summary Judgment, p. 41).
Defendants nevertheless insist that International has consistently interpreted § 2 as completely exempting charges relating to § 1(g) violations from any time limitation. Considering the very serious nature of § 1(g) violations as compared to the other violations of § 1,[5] I cannot characterize International's interpretation as being unreasonable. At a minimum, International's argument offers one possible reasonable interpretation of § 2. Moreover, plaintiffs have cited no evidence to bring into genuine dispute defendants' contention that said interpretation is consistent with prior International interpretations. Plaintiffs merely question whether that interpretation is correct. Of course, plaintiffs must do more than raise questions at this stage of the proceedings. See Celotex, supra. Consequently, this court must defer to the reasonable interpretation by International President Jones that the charges filed against plaintiffs were timely.
Next, plaintiffs argue that internal union charges were filed in bad faith and or in retaliation, but have offered no evidence to meet their burden of showing either bad faith or retaliatory purpose. Instead, it appears to be plaintiffs' contention that this court should permit a jury to infer retaliatory purpose solely on the basis of plaintiffs' legal challenge to the trusteeship's imposition and their subsequent unsuccessful opposition to the reelection of incumbent International President Charles Jones. However, bad faith or retaliatory *1332 purpose cannot be inferred solely from the opposition of plaintiffs to the leadership of International.
Finally, plaintiffs challenge the sufficiency of the evidence used to support the disciplinary findings against them. Upon a thorough reading of the transcript of the hearing on internal union charges, it is clear that the evidence introduced at the hearing was sufficient to support the unfavorable verdicts returned against plaintiffs. As stated in Vars v. International Brotherhood of Boilermakers, Iron Shipbuilders, Blacksmiths, Forgers & Helpers, 320 F.2d 576, 578 (2d Cir.1963):
The courts are not free to substitute their judgment for that of the trial court or to re-examine the evidence to determine whether it would have arrived at the same conclusion that was reached by the trial body. ... However, implicit in the requirement of a full and fair hearing is the requirement that there be some evidence to support the charges made.... If Section 101(5) is to provide any measure of protection for the individual union member who finds himself besieged by the full power of the International Union, some review is necessary in order to protect such members from obvious abuses. This is especially true in cases such as this where the hearing examiner is not an independent figure divorced from union controversies but is an officer of the International Union.
Accord, Lewis, 407 F.2d at 1195. Since this court may not substitute its judgment for that of the hearing examiner presiding over internal union disciplinary proceedings, the internal union findings must be sustained if they are supported by evidence. Clearly, there was some evidence to support the charges made against Hardy and Wilson. This evidence includes the undisputed fact that the bylaws of the local, adopted February 12, 1985, specified a lower weekly salary for the executive secretary than the salary paid to plaintiff Wilson in 1985 and 1986.
An appropriate order follows.
ORDER
AND NOW, this 29th day of February, 1988, for the reasons stated in the accompanying memorandum, IT IS ORDERED that:
1. Plaintiffs' motion for summary judgment is DENIED;
2. Plaintiffs' motion for summary judgment on internal union charges is DENIED;
3. Plaintiffs' motion for a preliminary injunction on internal union charges is DENIED; and
4. Defendants' motion for summary judgment is GRANTED.
NOTES
[1] While it is clear that the trusteeship has terminated we do not deny plaintiffs' allegations of invalidity with regard to the trusteeship as moot since arguably if the trusteeship was unlawfully imposed plaintiffs could be entitled to some kind of relief.
[2] Prior to September 3, 1986, on which date a majority in favor of continuing the trusteeship was obtained, International held its Consolidated Convention on August 14, 1986. Lodge 802 was able to send delegates since Trustee Abbott had secured a loan from International to the Lodge to cover the per capita tax arrearage. At a meeting conducted by Trustee Abbott the day after the trusteeship's imposition, lodge members nominated Ron Marley and Page Groton to be the sole delegates to the convention. Plaintiffs also attended the convention as delegates. Plaintiffs unsuccessfully challenged Marley and Groton's delegate status by testifying in favor of disqualification before a credentials committee. Both Marley and Groton supported the slate of candidates headed by Charles Jones, the incumbent International President. Plaintiffs backed the opposing slate. Charles Jones and the other persons running on his ticket, including Ron Marley, were elected.
[3] The record discloses that on or about August 7, 1986, International filed Form LM-15 with the United States Department of Labor stating therein three purposes of the trusteeship: (a) to correct corruption or financial malpractice, (b) to assure the performance of collective bargaining agreements or other duties of a bargaining representative, and (c) to restore democratic procedures.
[4] Section 464(c) in pertinent part provides:
In any proceeding pursuant to this section a trusteeship established by a labor organization in conformity with the procedural requirements of its constitution and bylaws and authorized or ratified after a fair hearing either before the executive board or before such other body as may be provided in accordance with its constitution or bylaws shall be presumed valid for a period of eighteen months from the date of its establishment and shall not be subject to attack during such period except upon clear and convincing proof that the trusteeship was not established or maintained in good faith for a purpose allowable under section 462 of this title.
[5] Section 1(n), for instance, makes it a chargeable offense to "caus[e] disruption or disturbance at a union meeting or union office ... or appea[r] at any meeting or office in an intoxicated condition." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583266/ | 682 F. Supp. 15 (1988)
UNITED FOOD AND COMMERCIAL WORKERS UNION, LOCAL 919, AFL-CIO
v.
LECHMERE, INC.
Civ. No. H-87-642 (PCD).
United States District Court, D. Connecticut.
March 23, 1988.
*16 Michael Feldman, Hoberman & Pollack, Hartford, Conn., for plaintiff.
J. William Gagne, Jr., Hartford, Conn., for defendant.
RULING ON MOTION TO DISMISS
DORSEY, District Judge.
Plaintiff, United Food and Commercial Workers Union ("Union"), brings this action to enjoin defendant, Lechmere, Inc. ("Lechmere"), from denying Union members access to defendant's parking lot for the purposes of distributing information to Lechmere's employees as part of an organizational campaign. Plaintiff alleges that it has sought to enter Lechmere's parking lot to communicate with the employees, who are willing to receive this information, and that Lechmere has denied access and has indicated that it will consider such entry to be an unlawful trespass. See Complaint, ¶¶ 3-4. Plaintiff argues that these actions have violated the Union members' rights of freedom of speech and assembly as they are guaranteed by the Connecticut Constitution, Art. I, §§ 4, 5, 14. Defendant moves to dismiss the complaint for failure to state a claim upon which relief can be granted under the state constitution. Defendant also moves to dismiss the action as preempted by the National Labor Relations Act ("NLRA"), 29 U.S.C. § 141, et seq.
The complaint alleges that plaintiff and its members sought access to defendant's premises for the purpose of distributing information to employees on the issue of unionization. On or about May 1, 1987, defendant denied plaintiff access to Lechmere's Newington store and parking lot. The store remains open to the public for access as customers. Plaintiff alleges that defendant's actions have rendered it unable effectively to communicate its message to Lechmere employees.[1]
State Constitutional Claim
The Union argues that, in blocking its ability to disseminate information to Lechmere employees, defendant has violated Art. I, §§ 4, 5, 14 of the Constitution of the State of Connecticut.[2] Defendant argues that these allegations do not state a claim upon which relief can be granted under the state constitution because Lechmere is a purely private actor and the cited sections do not reach private interference with individual expression.
When interpreting the Connecticut Constitution in a diversity action, this court sits as a trial court of the state and is bound by the holdings of the highest court of the state. See, e.g., Stolberg v. Members of Board of Trustees for State Colleges of *17 State of Connecticut, 541 F.2d 890 (2d Cir.), cert. denied, 429 U.S. 897, 97 S. Ct. 260, 50 L. Ed. 2d 181 (1976); Zucker v. Vogt, 200 F. Supp. 340, 341 (D.Conn.1961) (federal court sits as court of state to determine whether claim exists under state law). Plaintiff's contentionthat the state constitutional provisions respecting freedom of expression may limit the ability of a private property owner to exclude persons from his propertyhas been rejected by the Connecticut Supreme Court.[3]
In Cologne, the plaintiffs sought an injunction to restrain the owners of a shopping mall from denying them access to the mall for the purpose of distributing literature and soliciting signatures on petitions. Cologne, 192 Conn. at 50-52, 469 A.2d 1201. The Superior Court granted the injunction. On appeal, the Connecticut Supreme Court remanded with instructions to render judgment for the defendant mall owners. In discussing §§ 4, 5, 14 of the state constitution, the court made clear that those sections "`are designed as a safeguard against acts of the state and do not limit the private conduct of individuals or persons.'" Id. at 63, 469 A.2d 1201, quoting Lockwood v. Killian, 172 Conn. 496, 501, 375 A.2d 998 (1977). The court declined to strike the precise constitutional balances between private property rights and rights of expression which the plaintiff seeks to invoke here. See Cologne, 192 Conn. at 65-66, 469 A.2d 1201 (court will not "strike precise balance" between competing private interests).
Plaintiff argues that Cologne is distinguishable because, unlike the plaintiffs in that case, the Union's proposed expression is directly related to the private property involved. See, e.g., Logan Valley, 391 U.S. 308, 88 S. Ct. 1601 (protecting expression arising out of labor dispute with property owner), overruled in Hudgens, 424 U.S. 507, 96 S. Ct. 1029. Plaintiff also contends that, because defendant is dependent on government services and regulations such as building permits, police protection, and public transportation, and because defendant relies upon the state trespass laws to enforce its exclusionary policy, the requirement of state action is satisfied.
However, it is now well-settled that the Connecticut Constitution does not reach private conduct which restricts speech or expressive activity. Cologne, 192 Conn. at 63, 469 A.2d 1201; cf. Dydyn v. Department of Liquor Control, 12 Conn.App. 455, 463, 531 A.2d 170 (1987) (Connecticut courts have consistently adopted the reasoning of cases interpreting the first amendment of the federal constitution). The type or subject of the speech and its relation to the use of the property cannot be argued to expand the private right of expression in view of Cologne. Defendant thus cannot be held to have violated the state constitutional provisions.[4] Moreover, *18 Cologne expressly rejected the claim that a store or shopping center loses its private character by virtue of its size or the public's access for commercial purposes:
"Nor does property lose its private character merely because the public is generally invited to use it for designated purposes.... The essentially private character of a store and its privately owned abutting property does not change by virtue of being large or clustered with other stores in a modern shopping center." [Tanner, 407 U.S. at] 569 [92 S.Ct. at 2229]. If the furnishing of building permits, police protection and public transportation were deemed to constitute sufficient government involvement to transform the actions of the defendants in refusing the plaintiffs' requests into those of public officials, ... almost every improved property would be subject to the same burden the plaintiffs seek to impose upon [the defendants].
Cologne, 192 Conn. at 66, 469 A.2d 1201.
The Connecticut courts have not interpreted Art. I, §§ 4, 5, 14 to create a right on the basis of which plaintiff might complain of defendant's conduct. Accordingly, the complaint does not state a cause of action upon which relief can be granted. Defendant's motion to dismiss is granted.
Because plaintiff has not stated a cause of action under the Connecticut Constitution, it is unnecessary to reach the question of whether, if such a cause of action existed, it would be preempted on the ground that defendant's conduct was "arguably prohibited" by Section 8(a)(1), or that plaintiff was engaged in conduct "arguably protected by" Section 7 of the NLRA. See San Diego Building Trades Council v. Garmon, 359 U.S. 236, 245, 79 S. Ct. 773, 779-80, 3 L. Ed. 2d 775 (1958).
SO ORDERED.
NOTES
[1] Based thereon, plaintiff has filed an unfair labor practice charge with the National Labor Relations Board. See Affidavit of Robert P. Joy. The record does not disclose any final action by the Board on the charge.
[2] Section 4 provides:
Every citizen may freely speak, write and publish his sentiments on all subjects, being responsible for the abuse of that liberty.
Section 5 provides:
No law shall every be passed to curtail or restrain the liberty of speech or of the press.
Section 14 provides:
The citizens have a right, in a peaceable manner, to assemble for their common good, and to apply to those invested with the powers of government, for redress of grievances, or other proper purposes, by petition, address or remonstrance.
[3] Plaintiff's view of these provisions parallels the course taken by courts of several other states in interpreting their own constitutions as extending protection to expressive activity on private property. See Robins v. Pruneyard Shopping Center, 23 Cal. 3d 899, 592 P.2d 341 (1979) (protecting solicitation of petitions), aff'd, 447 U.S. 74, 100 S. Ct. 2035, 64 L. Ed. 2d 741 (1980); Batchelder v. Allied Stores Int'l, Inc., 388 Mass. 83, 445 N.E.2d 590 (1983) (same); Alderwood Associates v. Washington Environmental Council, 96 Wash.2d 230, 635 P.2d 108 (1981) (same). Indeed, for a brief period the United States Supreme Court interpreted the first amendment of the federal constitution to protect union picketing upon the private property of a shopping center where, as the Union alleges here, the activity is related to a dispute between the employer and the workers involved. Amalgamated Food Employees Union v. Logan Valley Plaza, 391 U.S. 308, 318, 88 S. Ct. 1601, 1608, 20 L. Ed. 2d 603 (1968). Logan Valley Plaza, Inc., 391 U.S. 308, 88 S. Ct. 1601 (1968), was overruled in Hudgens v. NLRB, 424 U.S. 507, 96 S. Ct. 1029, 47 L. Ed. 2d 196 (1976) (holding that federal constitutional protection does not extend to expression on private property). However, nothing prevents states from providing greater levels of protection. Pruneyard Shopping Center v. Robins, 447 U.S. 74, 81, 100 S. Ct. 2035, 2040-41, 64 L. Ed. 2d 741 (1980). The Connecticut Supreme Court refused the invitation to interpret the Connecticut Constitution as providing such greater protection, despite a cogent dissent by Chief Justice Peters which delineated the textual, historical and precedential support for doing so. Cologne v. Westfarms Associates, 192 Conn. 48, 66, 469 A.2d 1201 (1984). This court is bound by that holding which, as discussed below, is dispositive of plaintiff's claim.
[4] To the extent that Cologne adopts the reasoning of cases interpreting the first amendment, plaintiff's proposed distinction based upon the subject of the speech and the "public" nature of the shopping center are foreclosed by Hudgens, 424 U.S. at 519-20, 96 S.Ct. at 1036-37 and Lloyd Corp. v. Tanner, 407 U.S. 551, 568-69, 92 S. Ct. 2219, 2228-29, 33 L. Ed. 2d 131 (1972). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/238309/ | 229 F.2d 5
The LOUISIANA LAND AND EXPLORATION COMPANY, Appellant,v.STATE MINERAL BOARD, Appellee.
No. 15531.
United States Court of Appeals Fifth Circuit.
Jan. 27, 1956.Rehearing Denied Feb. 28, 1956.
L. K. Benson, J. B. Miller, H. H. Hillyer, Jr., New Orleans, La., for appellant.
H. M. Holder, Shreveport, La., James R. Fuller, Sp. Asst. Atty. Gen. of Louisiana, Fred S. LeBlanc, Atty. Gen. of Louisiana, John L. Madden, Asst. Atty. Gen. of Louisiana, Grove Stafford, Sp. Asst. to Atty. Gen. of Louisiana, for Appellee.
Before BORAH and JONES, Circuit Judges, and BENJAMIN C. DAWKINS, Sr., District Judge.
BORAH, Circuit Judge.
1
The question here is one of jurisdiction. Invoking the jurisdiction of the District Court, on the ground of diversity of citizenship, The Louisiana Land and Exploration Company, a Maryland corporation, instituted this action against the Louisiana State Mineral Board, a public corporation,1 seeking to restrain the Board from soliciting bids for or from granting a mineral lease or leases on certain lands, including the beds of certain water bodies, located in Jefferson Parish, Louisiana, which lie within the confines of twenty-six regular and fractional sections in Townships 17 and 18 South, Ranges 23 and 24 East.2
2
The complaint alleges that plaintiff is the true and lawful owner of the area within these sections by title emanating from State Patents Nos. 9018 and 9020, dated April 13, 1904, and by virtue of two transfers from the Lafourche Basin Levee District, dated July 14, 1904, and October 13, 1904, respectively. It then sets forth plaintiff's chain of title, and alleges that the State has never instituted a suit or proceeding to vacate or annul the said patents and transfers and that Act 62 of 1912, LSA-R.S. 9:5661, bars any such proceedings. The text of the Board's description of the lands in Tracts 5906 and 5907, which are here involved, and on which it is alleged to have requested bids for mineral leases is next set forth. The description reads, in part: 'All of the lands owned by the State of Louisiana, including, but not limited to, the beds and bottoms of all of the water bodies and streams. * * * and all islands and other lands formed by accretion or reliction (less and except tax lands and lands and water bottoms under oil, gas and mineral lease from the State * * *),' situated in Townships 17 and 18 South, Ranges 23 and 24 East. The two tracts are described by metes and bounds and the portions claimed to be State-owned are estimated to be 612 and 1378 acres, respectively. The complaint then sets forth that the defendant's action in advertising the two tracts for lease is ultra vires, null and void, casts illegal clouds upon plaintiff's title, constitutes a trespass upon plaintiff's rights, and a disturbance of plaintiff's possession. And then, following allegations of the lack of an adequate remedy at law and the necessity for injunctive relief to prevent irreparable injury, plaintiff prays: (1) for a temporary restraining order pending application for a preliminary injunction, and on final hearing a permanent injunction 'enjoining and restraining defendant, State Mineral Board, its officers, agents, servants, employees, attorneys and other representatives from asserting or purporting to assert any right to grant a mineral lease or leases on those portions of Tracts 5906 and 5907 * * * insofar as said Tracts * * * purport to include any of the property' alleged to be owned by plaintiff, 'and from taking any further steps looking to the granting of any such mineral lease or leases;' and (2) that the court 'adjudge and decree that defendant was and is without any right, power or authority to attempt to include within said Tracts 5906 and 5907' any of the property described in the complaint as being owned by plaintiff, 'for the purpose of attempting to grant any mineral leases thereon.'
3
Upon the filing of the verified complaint, the district judge granted a temporary restraining order and thereafter, and following a hearing, he sustained defendant's motion to dissolve the temporary restraining order on the ground that the District Court was without jurisdiction for the reason that the suit was in effect a suit against the State of Louisiana, citing Larson v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 69 S. Ct. 1457, 93 L. Ed. 1628. Thereafter, the case came on for hearing on plaintiff's application for a preliminary injunction and defendant's opposition thereto, and the court being of the opinion that it was without jurisdiction entered an order refusing to grant the preliminary injunction for the same reasons which it gave in its prior order dissolving the restraining order. It is from these two orders of the District Court that the plaintiff has appealed.
4
The narrow question presented on this appeal is whether the within action is, in effect, a suit against the State. Appellant contends that this question must be answered in the negative. First, it is argued that the State Mineral Board is a separate and distinct corporate entity, possessing all of the usual powers incident to corporations, and that this was sufficient to vest the District Court with jurisdiction based upon diversity of citizenship. Whether or not appellant is right in this contention must be determined by the law of the State. In Louisiana Highway Commission v. Farnsworth, 5 Cir., 74 F.2d 910, and in Department of Highways of La. v. Morse Bros. & Associates, Inc., 5 Cir., 211 F.2d 140, this court had occasion to consider a like question, and our decisions in both cases were of necessity predicated upon the clear and unmistakable pronouncement of the Louisiana Supreme Court in Saint v. Allen, 172 La. 350, 134 So. 246, 249, that the Louisiana Highway Commission was a 'distinct legal entity (separate) from the state.' Appellant relies heavily upon Saint v. Allen, supra, but this decision is not apposite here and cannot be applied to the State Mineral Board for the reasons which the Louisiana Supreme Court pointed out in State v. Texas Co., 205 La. 417, 17 So. 2d 569. There, it likened the State Mineral Board to an agent of an independent property owner who had been granted full, but not exclusive, authority in the management and supervision of the owner's holdings. Thus, the fact that the legislature chose to call it a corporation does not alter the Board's characteristics so as to make it something other than what it actually is, a mere agent of the State. Accordingly, it is clear that when the Board sues or is sued, it appears in court as an agent of its principal, the State. We, therefore, are of the opinion that this suit against the State Mineral Board, a mere agency or arm of the State, is in effect, a suit against the State which may not be sued by a citizen of another state under the Eleventh Amendment to the Constitution of the United States. Cf. State Highway Commission of Wyoming v. Utah Const. Co., 278 U.S. 194, 49 S. Ct. 104, 73 L. Ed. 262.
5
This brings us to a consideration of appellant's second point which is that the Eleventh Amendment is inapplicable and does not bar the present suit against a State agency which wrongfully has exceeded its statutory authority. This contention is likewise without merit for the reason that the complaint is directed against the State Mineral Board in its official capacity, not against its members individually, and because the acts complained of are not without, but clearly within the Board's statutory power. It is true that the complaint did allege that the Board's action was 'ultra vires' and cast 'illegal' clouds upon plaintiff's title, but these allegations were not and could not be based upon any lack of statutory power on the part of the Board to advertise, as it was alleged to have done, for lease bids upon 'all lands owned by the State.' The Larson case makes its clear that if the actions of an officer do not conflict with the terms of his valid statutory authority, then they are actions of the sovereign, whether or not they are tortious under general law. This does not mean, as was pointed out in the Larson decision, that a government officer is thereby necessarily immunized from liability, if his action is such that liability would be imposed by the general law of torts, but only that in this situation the action itself cannot be enjoined, since it is also the action of the sovereign. It is therefore plain that the State Mineral Board cannot be enjoined in this suit since the compulsion which the court is asked to impose would be compulsion against the sovereign; and for that reason the suit is barred by the Eleventh Amendment, not because it is a suit against the Board, but because it is, in effect, a suit against the State.
6
In the light of the foregoing we hold that the district judge was right for the reasons which he gave in dissolving the restraining order and in concluding that a preliminary injunction should not issue. Accordingly, the orders appealed from are affirmed and the cause is remanded to the District Court with directions to dismiss the suit for want of jurisdiction.
1
LSA-- Revised Statutes of 1950, 30:121 et seq
2
From the exhibits attached to the complaint, it is apparent that the designated sections contain considerably more than 10,000 acres | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/2191631/ | 275 Cal.App.2d 839 (1969)
MID-CENTURY INSURANCE CO., Plaintiff, Cross-complainant and Appellant,
v.
VALENTINE HERNANDEZ et al., Defendants, Cross-defendants and Respondents; GALBRAITH'S CYCLE FUN, INC., Defendant, Cross-defendant and Appellant; TRAVELERS INDEMNITY CO., Defendant, Cross-complainant and Respondent; STUYVESANT INSURANCE CO., Cross-complainant and Appellant.
Civ. No. 32744.
California Court of Appeals. Second Dist., Div. Four.
Aug. 26, 1969.
Archbald, Zelezny & Spray, Joseph L. Spray and Edward L. Lascher for Plaintiff, Cross-complainant and Appellant.
Buck, Burrows & Smith and Peter Burrows for Defendant, Cross-defendant and Appellant, and for Cross-complainant and Appellant.
Eckert & O'Gorman and Charles V. Eckert III for Defendants, Cross- defendant and Respondents. *841
Barnes, Benton, Orr, Duval & Buckingham and Edwin Duval for Defendant, Cross-complainant and Respondent.
KINGSLEY, J.
On July 4, 1965, defendant Valentine Hernandez (Valentine), while operating a motorcycle rented to him by Galbraith's Cycle Fun, Inc. (Galbraith's), was involved in a collision with Raul Torres (Torres), in which Torres received physical injuries. Torres brought suit against Valentine, his parents Soledad and Incarnacion Hernandez [fn. 1] (Soledad and Incarnacion), and Galbraith's. [fn. 2] He recovered a judgment against Valentine for $20,000, of which $10,000 was jointly against Valentine and his parents and $10,000 was jointly against Valentine and Galbraith's. [fn. 3]
The present action is one in declaratory relief, primarily between three insurance companies, each of whom had issued a policy that arguably provided coverage to one or more of the judgment debtors. Mid-Century Insurance Company (Mid-Century) had issued an automobile liability insurance policy, with a policy limit of $10,000 for injury to one person, in which Valentine was the named insured, covering a described 1956 Chevrolet automobile owned by him. Travelers Indemnity Company (Travelers) had issued a so-called "Family Automobile Policy," with a policy limit of $10,000 for injury to one person, in which Soledad Hernandez was the named *842 insured, [fn. 4] covering two automobiles owned by him and described therein. Stuyvesant Insurance Company (Stuyvesant) had issued a policy, with a policy limit of $300,000 for bodily injury resulting from any one accident, in which Galbraith's was the named insured, covering it in its business of motorcycle rentals. Each policy contained provisions relating to insurance coverage for persons other than the respective named insureds, relating to nonowned automobiles, and dealing with the extent of coverage and liability in cases of double insurance. We discuss the various clauses of that nature later in this opinion.
The trial court entered a judgment holding that Stuyvesant was primarily liable, with coverage limited to $10,000 on the judgment against Valentine, but with available coverage up to $300,000 on the judgments against Galbraith's and against Soledad and Incarnacion. [fn. 5] Mid-Century was held to have coverage, as excess over Stuyvesant, to the $10,000 limit of its policy. Travelers was held to have coverage, as excess over both Mid-Century and Stuyvesant, to the $10,000 limit of its policy.
Mid-Century and Stuyvesant have appealed; Travelers has not appealed and its brief supports the judgment as entered; Galbraith's, represented by the same counsel as Stuyvesant, joins in that company's appeal and contentions; Torres and the three Hernandez have not appealed. [fn. 6]
It is admitted that, no matter what determination is made as to the various contentions of the three insurance companies, some combination of them will be liable to pay the full $20,000 of Torres' judgment and that the three Hernandez will be protected against that judgment. Although Galbraith's has joined in the appeal taken by its insurance carrier, its $10,000 liability is covered by its policy with Stuyvesant, no matter what other liability that insurance company may have toward the three Hernandez and Torres. [fn. 7] In other *843 words, the present appeal involves only: (1) the question of whether or not Mid-Century has coverage at all; and (2) the amount and order of liability of each company ultimately determined to have provided coverage for the accident.
The case was tried below on the terms of the three policies, with no extrinsic evidence except certain stipulations. As a result, the meaning and effect of those documents are matters for this court to decide, for itself, as matters of law. (Parsons v. Bristol Dev. Co. (1965) 62 Cal.2d 861 [44 Cal.Rptr. 767, 402 P.2d 839].)
Stuyvesant admits that its policy provided coverage to the three Hernandez and to Galbraith's; its contentions here go only to the amount of that coverage and to the order of its liability vis-a-vis the other two companies.
Travelers, which has not appealed, for obvious reasons, is content with its position as third in line for liability.
Mid-Century denies that its policy covered the accident at all; as an alternative it argues that if it had any liability such liability was (as the trial court held) excess over Stuyvesant's and should be prorated with the liability of Travelers.
We shall discuss, first, as to each policy, whether or not it provided coverage for the injuries to Torres and, if so, for whom and in what amount. Thereafter, we shall discuss the order in which each carrier who has coverage as to Valentine should respond. For reasons which we state later, it is not necessary, on this appeal, to determine the order of liability as to the senior Hernandez or as to Galbraith's.
I
[1] We discuss, first, Mid-Century's contention that its policy provided no coverage applicable to the accident herein involved. Its policy, with a limit of liability of $10,000 to any one person, was issued to Valentine and described only a 1956 Chevrolet automobile owned by him. The contention is that the provision of its policy which extended coverage to "non-owned automobiles," by its express terms extended that coverage only to "automobiles," thus excluding "motorcycles" from the protection given. The argument is without merit. The public policy of this state, as expressed in section 11580.1 of the Insurance Code, and sections 16451 and 16452 of the Vehicle Code, as those sections, and their predecessor sections have been construed in Wildman v. Government Emp. *844 Ins. Co. (1957) 48 Cal.2d 31 [307 P.2d 359], and the later cases applying its rule, is as follows: Any owner's motor vehicle liability policy governed by California law must provide coverage for the vehicle therein described no matter who operates it, so long as that operation is within the continental United States and with the consent of the named insured, unless, by an endorsement conforming to subdivision (e) of the Insurance Code section 11580.1, some particular person is expressly excluded. Any operator's policy must provide coverage for the named insured for any nonowned motor vehicle that he operates, whether therein described or not, so long as the operation is within the continental United States. Any attempt by an insurance company to limit its required coverage is void and ineffective.
It is, of course, quite true, as Mid-Century argues (unnecessarily and at length), that a motorcycle is not an automobile. But a motorcycle admittedly is a "motor vehicle" (Veh. Code, 400), and the sections of the Insurance Code and of the Vehicle Code above cited, and the policy expressed in those sections, apply to all "motor vehicles," whether they are automobiles or motorcycles.
This was the conclusion reached over six years ago by Division Two of this court, in Voris v. Pacific Indem. Co. (1963) 213 Cal.App.2d 29 [28 Cal.Rptr. 328]. As Mid-Century correctly points out, Voris' technical holding was merely that an uninsured motorist endorsement, executed after the enactment of section 11580.2 of the Insurance Code providing for such coverage, but prior to the effective date of that statute, should be construed to include a motorcycle within the meaning of the word automobile as used in that endorsement. But the reasoning by which that result was reached was that the draftsman of the endorsement had intended to give a coverage equal to that which the then recently enacted but not then yet effective statute would give to future policyholders, and that the statute, by its use of the term "motor vehicle," had included motorcycles. We see no reason why the term "motor vehicle" in section 11580.2 of the Insurance Code should be read more broadly than the same term in the section immediately preceding or in the companion sections ( 16451 and 16452) of the Vehicle Code. Therefore, we regard the decision in Voris as controlling on this branch of the case at bench. [fn. 8]*845
It follows that the Mid-Century policy provided coverage to Valentine. By its express terms, protection was also extended to "relatives" of the named insured, thus bringing Soledad and Incarnacion within the group of those insured under its policy. [fn. 9]
II
[2] We turn next to the arguments over the Stuyvesant policy.
That policy raises neither the issue involved with Mid-Century nor the one later discussed that is involved with Travelers. As we have said, Galbraith's was the named insured; the policy expressly covered motorcycles; the motorcycle in question was an "owned" vehicle; and, except for the escape clause hereinafter considered, there is no question that Valentine, as a permissive user of Galbraith's owned motorcycle, and Soledad and Incarnacion as endorsers of Valentine's operator's license, were also insureds under the Stuyvesant policy.
As we have said above, the trial court held that company to be primarily liable, but that its coverage amounted to only $10,000 for Valentine, although it amounted to the full policy limit of $300,000 for Galbraith's and for Soledad and Incarnacion. Mid-Century attacks that judgment only insofar as it limited the Stuyvesant coverage for Valentine to $10,000; Stuyvesant attacks the judgment on the ground that, under the terms of an escape clause in its policy and the statute relating to such clauses, it provided no coverage at all for Valentine, or for the senior Hernandez. We disagree with the trial court and with both Mid-Century and with Stuyvesant. *846
Stuyvesant premises its argument on the language of subdivision (f) of section 11580.1 of the Insurance Code and on an escape clause, couched in the following language, and contained in paragraph 7 of Endorsement No. 1 to its policy: "Such insurance as is provided by this policy for the rentee shall not apply to any loss with respect to which the rentee has other valid and collectible coverage. It is further agreed that in any event, the limit of the Company's liability to the rentee shall not exceed the applicable minimum limit of liability specified in the financial responsibility laws of the state in which the vehicle is principally garaged." It is contended that that provision in the policy is valid by reason of the language of subdivision (f) of section 11580.1 of the Insurance Code. As of the dates herein involved, that subdivision read as follows: "... such policies may contain a provision that the insurance coverage applicable to such motor vehicles afforded a person other than the named insured or his agent or employee shall not be applicable if there is any other valid and collectible insurance applicable to the same loss covering such person as a named insured or as an agent or employee of a named insured under a policy with limits at least equal to the financial responsibility requirements specified in Section 16059 of the Vehicle Code; and in such event, the two or more policies shall not be construed as providing cumulative or concurrent coverage and only that policy which covers the liability of such person as a named insured, or as an agent or employee of a named insured, shall apply. In the event there is no such other valid and collectible insurance, the coverage afforded a person other than the named insured, his agent or employee, may be limited to the financial responsibility requirements specified in Section 16059 of the Vehicle Code."
It must be noticed that the policy provision is, in one respect, broader than the statutory provision and, in another respect, narrower than the statute would have permitted.
The escape clause in the policy purports to apply to all losses as to which the rentee has "other valid and collectible insurance," whereas the statute permits such a clause only as to losses as to which there is insurance which is not only "valid and collectible," but which covers the additional insured "as a named insured or as an agent or employee of a named insured." As we shall see, although Valentine had coverage under the Travelers policy, he was not a "named" insured thereunder. It follows that, since Valentine was the "named insured" under the Mid-Century policy, the Stuyvesant *847 policy did not provide coverage for him for such part of the Torres' judgment as was covered by the Mid-Century policy--i.e., $10,000. But, since Valentine was not a "named insured" under the Travelers policy, Stuyvesant's policy did provide coverage for him beyond the protection afforded by Mid- Century--i.e., Valentine had coverage with Stuyvesant for the second $10,000 of the $20,000 judgment against him.
On the other hand, as we have said, the escape clause in the Stuyvesant policy does not go as far in another direction as the statute would have permitted. For reasons known to it, the company elected to limit its liability to persons other than the named insured only where that person was the "rentee." Since neither Soledad nor Incarnacion were rentees of the motorcycle, it follows that Stuyvesant's coverage as to them went to the full $300,000 limit of its policy, as did its coverage to Galbraith's, and nothing in the quoted policy provision operates to relieve Stuyvesant from liability for the portions of the judgment against those three judgment debtors of Torres, if those portions of the judgment should become effective.
III
[3] We turn, next, to the question of whether or not the Travelers policy gave coverage to any of the judgment debtors. Its policy, with a limit of $10,000 for injury to one person, insured Soledad and two described automobiles owned by him. The company has stipulated that its protection (whatever it was) extended also to Incarnacion as a named insured.
Travelers first makes the same contention as does Mid-Century, namely that, since the policy refers only to "automobiles," it afforded no coverage at all with respect to a motorcycle. For the reasons above set forth, we reject that argument.
Travelers next calls attention to an endorsement making the policy not applicable "while the automobile is being operated by ... Valentine Hernandez," and argues that that provision defeats coverage. While the statute (subd. (e) of Ins. Code, 11580.1) permits a clause excluding named persons from the coverage otherwise extended, we think that the language here used did not operate to exclude coverage for, nor as to, Valentine except where he was operating one of the two automobiles expressly described in the policy. We are enjoined by many cases, among them Gray v. Zurich Ins. Co. (1966) 65 Cal.2d 263 [54 Cal.Rptr. 104, 419 P.2d 168], that *848 policy provisions must be read in the light of the "reasonable expectations" of the insured. Two factors lead us to the conclusion stated. In the first place, the draftsman, in dealing with a policy which, by its express terms, applied not only to described automobiles but to an indefinite number of non-owned automobiles, elected to use, in this provision, the restrictive word "the automobile" and not the general term "an automobile." In the second place, although public policy compels the insurance company to provide coverage for motorcycles as well as for automobiles, that requirement exists whatever Soledad Hernandez thought and even if he did not realize that he was getting the wider protection. But the construction of the clause at issue is a matter of construing a contract. Soledad hardly could be expected to understand that the special endorsement applied to a vehicle that he did not know was covered by the policy. It follows that the attempted special exclusion of Valentine is not applicable and that, if Valentine is otherwise covered under the Travelers policy, the quoted endorsement does not operate to relieve Travelers from a coverage as to Valentine, up to the $10,000 extent of its policy. We understood Travelers' counsel to concede as much at oral argument.
Travelers agreed, in Part I of its policy, "To pay on behalf of the insured all sums which the insured shall become legally liable to pay. ..." With respect to a nonowned automobile, the policy defines the word "insured" as including both the named insured (here Soledad and Incarnacion) and "any relative, but only with respect to a private passenger automobile or trailer" and it defines the word "relative" as meaning "a relative of the named insured who is a resident of the same household." It was stipulated that Valentine was such a resident.
Travelers contends that, even if the word "automobile" must, for reasons above discussed, be read as including "motorcycle" in any clause relating to the described automobiles or relating to the named insured, the law does not require such an extension in a clause relating only to a non-owned and undescribed automobile driven by an unnamed insured. It relies on the language of section 16452 of the Vehicle Code, which, so far as here pertinent, reads as follows: "An operator's policy of motor vehicle liability insurance shall insure the person named as insured therein against loss from the liability imposed on him by law for damages arising out of use by him of any motor vehicle not owned by *849 him, ... within the same territorial limits and subject to the same limits of liability as are set forth above with respect to an owner's policy of liability insurance."
It is true, as Travelers argues, that the law of California does not require an insurance company to issue a policy covering persons other than the named insured except as they are permissive users of a described and owned motor vehicle. But if, for its own reasons, an insurance company elects to issue a policy that provides "motor vehicle" liability insurance to someone described therein by class rather than by name, and in so doing describes the members of that class as "insured," then the public policy expressed in the statutes and in the cases construing those statutes comes into play. That policy, as we have said above, requires that, if an operator is to be insured at all, he must be insured wherever and for whatever motor vehicle he drives. By expressly designating Soledad's relatives residing in his household as being "insured," the Travelers policy necessarily provided coverage for Valentine no matter what kind of nonowned motor vehicle he drove.
IV
[4] We turn now to consider in what order of priority the three policies, each of which provides coverage for Valentine, are liable to pay the $20,000 judgment against him.
We have quoted above the escape clause in the Stuyvesant policy. The statute (subd. (f) of Ins. Code, 11580.1) provides as follows: "... the two or more policies shall not be construed as providing cumulative or concurrent coverage and only that policy which covers the liability of such person as a named insured, or as an agent or employee of a named insured, shall apply." The Mid-Century and the Travelers policies each contain a so-called "excess liability" clause. So far as is herein pertinent the clause in the Mid-Century policy reads as follows: "With respect to a substitute or non-owned automobile, Coverages A ... shall be excess insurance over any other collectible insurance of any kind available to the insured irrespective of whether such other insurance was obtained by a person other than the named insured." The clause in the Travelers policy reads as follows: "... the insurance with respect to a temporary substitute or non-owned automobile shall be excess over any other valid and collectible insurance."
For the reasons we have discussed above in considering the escape clause in the Stuyvesant policy, that policy did not *850 provide coverage "available" to Valentine for any liability covered by the Mid-Century policy. As between Mid-Century and Stuyvesant, therefore, Mid-Century had a primary liability to the extent of its policy limits--i.e., it is liable for the first $10,000 of the judgment against Valentine.
As between Stuyvesant and Travelers, however, a different result follows. Were it not for the escape clause, the Stuyvesant policy would have provided coverage for Valentine (as the rentee of an owned motor vehicle) to the full $300,000 limit of that policy. It is only by reason of the escape clause and the statute permitting such a clause, that Stuyvesant becomes subordinate in liability to Mid-Century. But, as we point out above, the escape clause in the policy does not come into operation at all insofar as the Travelers policy is concerned. As between Stuyvesant and Travelers, the Stuyvesant policy is "valid and collectible" insurance entitling Travelers to rely on its excess clause and to take third place in the order of liability.
Were the present proceeding concerned only with the Mid-Century and Travelers policies, then, under well-settled law, the two "excess" clauses would have cancelled out and each company would have been liable, pro rata, to pay the judgment against Valentine. However, since that judgment is for $20,000, the actual result would have been that each company would have paid its full policy limit. Since Mid-Century is liable for its policy limit, and for no more than that limit, under any valid theory of priority, it is of no consequence to it whether the remainder of the judgment is paid by Stuyvesant or by Travelers. That final payment concerns only the latter two companies and, as between them, Travelers' liability is subordinate to that of Stuyvesant.
V
The judgment imposed on Stuyvesant the full cost of defense of the Torres' action not only insofar as a defense was provided for Galbraith's but also for the costs of defense of the three Hernandez. The principles above discussed necessarily require a revision of that portion of the judgment.
VI
As we have said above, it is unnecessary, in this case, to determine the problems of coverage or of order of liability in connection with the judgments against Galbraith's and against Soledad and Incarnacion. For the reasons set out by us in American Motorists Ins. Co. v. Underwriters at Lloyd's *851 London (1964) 224 Cal.App.2d 81 [36 Cal.Rptr. 297], and to avoid circuity of action, the insurance providing coverage for Valentine should be resorted to first. It is nowhere suggested that any of the three companies involved are financially unable to pay their portion of the judgment against Valentine; such payment will satisfy not only the judgment against Valentine but the judgment against the other judgment debtors. It is only in the unlikely event that both Mid- Century and Travelers should become insolvent that any different result could follow; in that remote event, the principles above set forth would render the escape clause in the Stuyvesant policy inoperable and that company would become liable for the full $20,000.
The judgment is reversed; the case is remanded for further proceedings consistent with this opinion. Travelers shall recover its costs on appeal against Mid-Century and Stuyvesant and against them only. Mid-Century and Stuyvesant shall each bear its own costs on appeal.
Jefferson, Acting P. J., and Dunn, J., concurred.
"(A) That plaintiff have and recover judgment against defendants Valentine Hernandez, Soledad Hernandez and Incarnacion Hernandez, jointly and severally, in the sum of $10,000."
"That said judgment against Soledad and Incarnacion Hernandez is founded solely upon their liability for signing and verifying the application of Valentine Hernandez, a minor, for a driver's license in the manner and style described by the provisions of California Vehicle Code Section 17707."
"(B) That plaintiff have and recover judgment against Valentine Hernandez and Galbraith's Cycle Fun, Inc. a corporation, jointly and severally, in the additional sum of $10,000."
"That said judgment against Galbraith's Cycle Fun, Inc., a corporation, is founded solely upon its liability as the registered owner of the vehicle permissively operated by defendant Valentine Hernandez within the meaning of the provisions of California Vehicle Code Section 17150, agency not being involved."
"(C) That the provisions of paragraphs (A) and (B) of this judgment are cumulative to the end that payment of the total sum of $20,000.00 plus interest, if any, accrued thereon, shall be required to satisfy this judgment in full."
NOTES
[fn. 1] 1. Valentine was a minor, aged 18; Soledad and Incarnacion are liable, to the extent of $10,000, because they had signed his application for an operator's license. (Veh. Code, 17707 and 17709.)
[fn. 2] 2. Galbraith's, as the owner of the motorcycle, is liable, also to the extent of $10,000, under Vehicle Code, sections 17150 and 17151.
[fn. 3] 3. We state the judgment according to its legal effect. In form, the judgment read as follows:
[fn. 4] 4. By stipulation, Travelers agreed that Incarnacion was to be treated as an additional named insured under its policy.
[fn. 5] 5. Since, as explained in footnote Nos. 1, 2 and 3, supra, the judgments against Galbraith's and against the senior Hernandez are each limited to their respective statutory liability of $10,000, it follows that Stuyvesant is actually subject to a maximum liability of $20,000 under any theory.
[fn. 6] 6. Torres and the three Hernandez were named as parties respondent on this appeal. Their respective counsel have filed notices of appearance but, because Torres will recover his judgment, and the Hernandez will be protected against liability, no matter how the appeal is decided, they did not file briefs or participate in the oral argument.
[fn. 7] 7. In its closing brief Mid-Century, for the first time, objects to the appearance here of Galbraith's as an appellant. Whatever merit the point might have had, it comes too late for us to consider it.
[fn. 8] 8. Counsel for Mid-Century cites us to the recent decision by the Appellate Department of the Superior Court for the County of Los Angeles, in Lightner v. Farmers Ins. Exchange (1969) 274 Cal.App.2d Supp. 928 [79 Cal.Rptr. 526]. That case held that a young man operating a motorcycle was not covered under the medical insurance clause of a policy describing an automobile. The case is not in point. The policy underlying section 11580.1 of the Insurance Code and sections 16451 and 16452 of the Vehicle Code is concerned with affording insurance protection to injured third parties by making sure that the tortfeasors are insured to a statutorily fixed limit. That policy does not extend to a requirement that the operator of a motor vehicle be covered by insurance for his own injuries. The fact that a provision for a limited degree of medical insurance is included in the same document as one that provides for liability insurance does not make that medical insurance provision a policy of "automobile liability insurance" within the meaning of the cited sections.
[fn. 9] 9. The policy includes, as additional insureds with respect to a non-owned automobile: "... (1) the named insured or a relative, and (2) any other person or organization not owning or hiring such [described] automobile if legally responsible for its use by the named insured or a relative, but only in the event such named insured or relative is legally liable for the occurrence; provided the actual use of the non-owned automobile by the persons in (1) and (2) above is with the permission, or reasonably believed to be with the permission, of the owner." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582236/ | 31 So.3d 1283 (2010)
Billy Ray ROBINSON, Appellant
v.
STATE of Mississippi, Appellee.
No. 2009-KA-00414-COA.
Court of Appeals of Mississippi.
April 6, 2010.
*1284 Justin Taylor Cook, attorney for appellant.
Office of the Attorney General by Charles W. Maris, Jr., Jackson, attorney for appellee.
Before LEE, P.J., IRVING, GRIFFIS and ISHEE, JJ.
GRIFFIS, J., for the Court:
¶ 1. On October 10, 2007, Billy Ray Robinson was convicted in Simpson County Circuit Court of the sale of cocaine. He was sentenced to ten years in the custody of the Mississippi Department of Corrections. Robinson filed a motion for a judgment notwithstanding the verdict or, in the alternative, a new trial, which the court denied. From this conviction, Robinson now appeals. We find no error and affirm.
¶ 2. On October 19, 2005, Mississippi Bureau of Narcotics agents met with a confidential informant named Stacy James. At the meeting, James agreed to participate in an undercover operation to buy illicit drugs from drug dealers in Magee, Mississippi. James's car was outfitted with audio-video recording equipment and the agents gave James a body wire to wear and official state funds with which to purchase drugs. James left the meeting with the agents and drove to Magee.
¶ 3. James stopped his car in front of a yard on North Raleigh Street in Magee, and Robinson approached the passenger side of James's vehicle. James asked Robinson for drugs. Robinson got into James's vehicle and sat on the passenger side. Robinson gave James directions. Robinson directed James to an area where Robinson could buy drugs.
¶ 4. James asked Robinson to purchase crack cocaine and gave him $20. Robinson left the car. He brought back a crack cocaine rock for James. The video surveillance recorded the exchange of the crack cocaine between James and Robinson.
¶ 5. James returned to the agents and gave them the alleged crack cocaine and the audio-video recording equipment. When tested, the substance contained 0.2 grams of cocaine. Robinson was arrested on November 1, 2006, and was charged with the unlawful sale of cocaine.
¶ 6. Robinson's counsel filed a brief pursuant to Lindsey v. State, 939 So.2d 743 (Miss.2005). Robinson has not filed a pro se supplemental brief.
¶ 7. Pursuant to Lindsey, it is the appellate counsel's responsibility to determine that his client's case presents no arguable issues on appeal; to file a brief showing that counsel has thoroughly reviewed the record and has found nothing to support an appeal; and, to send his client a copy of the brief, informing his client that he found no arguable issue for appeal and advising him of his right to file a pro se supplemental brief. Id. at 748 (¶18). If the defendant raises any arguable issue in his pro se brief or if the appellate court finds any arguable issues upon its independent review of the record, the appellate court must, if circumstances warrant, require counsel to file a supplemental brief of the issue. Id.
¶ 8. Here, Robinson's attorney indicated that he diligently searched the procedural and factual history of this action and scoured the record searching for any arguable issues that could be presented in good faith, but he found none. Robinson's attorney asserted that he examined: (1) the reason for the arrest and the circumstances surrounding the arrest of Robinson; (2) any possible violations of Robinson's right to counsel; (3) the entire *1285 transcript and content of the record; (4) all rulings of the trial court; (5) possible procedural misconduct; (6) all jury instructions; (7) all exhibits, whether admitted into evidence or not; (8) possible misapplication of the law in sentencing; (9) the indictment and all the pleadings in the record; (10) any possible ineffective assistance of counsel issues; and (11) whether the verdict is supported by the overwhelming weight of the evidence.
¶ 9. Robinson's counsel requested that this Court allow an additional forty days for Robinson to file a pro se supplemental brief, should he so desire. Robinson's counsel stated that he sent a copy of his brief and correspondence informing Robinson that he found no arguable issues in the record and that Robinson had a right to file a pro se brief.
¶ 10. As of this date, this Court has not received any supplemental filing by Robinson. Furthermore, after thoroughly reviewing the record, we have found no arguable issues for our review. Therefore, in lieu of any error which warrants reversal, we must affirm. McClain v. State, 928 So.2d 210, 211 (¶8) (Miss.Ct.App.2006) (citing Eaton v. State, 913 So.2d 413, 416 (¶6) (Miss.Ct.App.2005)).
¶ 11. THE JUDGMENT OF THE CIRCUIT COURT OF SIMPSON COUNTY OF CONVICTION OF SALE OF COCAINE AND SENTENCE OF TEN YEARS IN THE CUSTODY OF THE MISSISSIPPI DEPARTMENT OF CORRECTIONS IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO SIMPSON COUNTY.
KING, C.J., LEE AND MYERS, P.JJ., IRVING, BARNES, ISHEE, ROBERTS AND MAXWELL, JJ., CONCUR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3947422/ | Appellant was convicted of violating the speed law and his punishment was assessed at a fine of $5. *Page 192
The State's testimony shows that on the 6th day of June, 1937, the sheriff of Coryell County, accompanied by his deputy, were traveling on highway number seven from Gatesville to Waco. They observed appellant in his automobile traveling at the rate of about seventy-five miles per hour and undertook to arrest him. In their efforts, they ran him through the town of Gatesville to a point several miles beyond said town, where appellant's car bogged down in soft ground. The sheriff and his deputy were dressed in plain citizens clothes and had no warrant for his arrest. Appellant offered no affirmative testimony.
He asserts two grounds as to why his conviction is not authorized by law. First, because the officers had no warrant for his arrest; second, because they were not clothed in certain uniforms and had no official badge displayed on their persons.
Appellant is mistaken in both of the positions taken by him. Article 803, P. C., gives officers the authority to arrest persons without warrant who operate automobiles upon the public highways in excess of forty-five miles per hour and deal with them as provided by Article 792, P. C. His second contention is of no merit; in the case of Ex parte Heiling, 128 Tex. Crim. 399, this Court held that the statute requiring officers to wear certain uniforms, caps and official badges, was in contravention of the State Constitution.
Appellant objected to certain remarks made by the district attorney in his closing argument to the jury, and which he has brought forward for consideration by proper bills of exception. After a careful review of these matters, we have reached the conclusion that they are without merit and fail to show reversible error.
The judgment of the trial court is affirmed.
The foregoing opinion of the Commission of Appeals has been examined by the Judges of the Court of Criminal Appeals and approved by the Court.
ON MOTION FOR REHEARING. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1581660/ | 628 N.W.2d 1 (2001)
Jerry KURTH, Individually and d/b/a Fisherman's Wharf Restaurant, Appellee,
v.
IOWA DEPARTMENT OF TRANSPORTATION, Appellant.
No. 99-0666.
Supreme Court of Iowa.
May 31, 2001.
*3 Thomas J. Miller, Attorney General, David A. Ferree, Special Assistant Attorney General, and Mark Hunacek, Assistant Attorney General, for appellant.
Richard J. Barry of Montgomery, Barry & Bovee, Spencer, for appellee.
Considered en banc.
SNELL, Justice.
This fee condemnation case asks us to determine what type of evidence can be presented to the jury and what is proper *4 language to instruct the jury. The Iowa Department of Transportation (DOT) maintains that the jury was impermissibly allowed to hear testimony of the value of the business on the land being condemned. We agree. The jury's verdict is reversed and the case remanded for a new trial.
I. Factual Background and Procedure
Jerry Kurth owned and operated the Fisherman's Wharf Restaurant (Wharf) on West Lake Okoboji. Kurth purchased this property in 1994 for approximately $85,000. Kurth made several improvements to the restaurant. On August 5, 1997, Kurth received a condemnation notice for this property from the DOT to accommodate nearby bridge expansion. He was awarded $180,000 by the Dickinson County Compensation Commission.
The restaurant was in a prime location to receive business from highway and boat traffic. The restaurant property was zoned commercial and provided dock access and outside eating to accommodate its patrons. Kurth characterized this location as the busiest spot on West Lake Okoboji and the best location for a restaurant. According to trial testimony, there is no other commercially zoned property on West Lake Okoboji that could be used for a restaurant that fronts on the lake similar to the Wharf.
With the proceeds from the condemnation, Kurth bought nearby property on which had once been located a Kentucky Fried Chicken restaurant, no longer in business. Kurth's new property sits on East Lake Okoboji directly on the other side of the bridge from the Wharf. The restaurant is also on the lakefront with a dock and includes several amenities the Wharf did not, such as on-site parking, a newer building, and twice as much land. Kurth testified that he planned to someday open a restaurant on this location.
Kurth was unsatisfied with his condemnation award because he felt it did not take into account the Wharf's business value and location. Accordingly, Kurth sought judicial review of his award from the district court. Prior to trial, the DOT made a motion in limine to exclude evidence describing the business value of the Wharf or providing its past and future profits. The DOT wanted a determination based solely on the value of the land and the structure on it. This was denied, and the case went to jury trial.
Kurth presented the testimony of local real estate experts. Greg Winkel, a certified general real estate appraiser, testified to the worth of the land and the building. This figure was presented as $285,000. Larry Harden, a certified valuation analyst, utilized the "capitalization of earnings method" to place a fair market value on the business and the business property. To produce this number, the expert looked at past earnings to determine what the likely normalized future income would have been given this type of business and its history, location, risk, fixtures, etc. Harden arrived at the amount of $239,952, which he added to the $285,000 valuation for the land and building provided by the earlier expert. He then placed the total value of the Wharf property at $524,952.
Conversely, the DOT's expert real estate appraiser, James Hayes, concluded that the fee was worth only $182,500 by looking at comparable sales. At the conclusion of testimony, over the objection of the DOT, the judge instructed the jury to consider the value of the Wharf property using all competent facts the buyer would factor into his price, including, if relevant, the net income of the business on the property.
The jury returned a verdict for Kurth in the sum of $375,000. The DOT appeals this decision for three reasons: (1) The *5 court impermissibly allowed the jury to hear evidence of the value of the business; (2) The court erroneously instructed the jury as to what it may consider when valuing the condemned land; and (3) The court improperly overruled the DOT's objection to a letter containing hearsay statements.
II. Scope and Standard of Review
The standard of review is in dispute. Ordinarily, the district court's evidentiary and trial objection rulings are reviewed for an abuse of discretion. State v. Tracy, 482 N.W.2d 675, 680-81 (Iowa 1992). The DOT argues that when those decisions are based upon an erroneous interpretation of law, our review should be on legal error. See State v. Kjos, 524 N.W.2d 195, 196 (Iowa 1994). This is an accurate statement, however, the district court's ruling to allow testimony of the value of the business is not based on any statute or codified rule. Accordingly, we review this determination for an abuse of discretion.
"An abuse of discretion occurs when the trial court `exercises its discretion on grounds clearly untenable or to an extent clearly unreasonable.'" State v. Greene, 592 N.W.2d 24, 27 (Iowa 1999) (quoting State v. Smith, 522 N.W.2d 591, 593 (Iowa 1994)). "[W]e grant the district court wide latitude regarding admissibility" and will reverse only where the losing party was prejudiced by an unreasonable decision. State v. Sallis, 574 N.W.2d 15, 16 (Iowa 1998); accord State v. Caldwell, 529 N.W.2d 282, 285 (Iowa 1995).
When review of the district court's instruction to the jury is involved, our review is for correction of errors at law. City of Dubuque v. Fancher, 590 N.W.2d 493, 495 (Iowa 1999). "Error in giving ... a particular instruction does not warrant reversal unless the error is prejudicial to the party." Herbst v. State, 616 N.W.2d 582, 585 (Iowa 2000). Prejudice is presumed when the jury has been misled by a material misstatement of the law. Graber v. City of Ankeny, 616 N.W.2d 633, 642 (Iowa 2000); Iowa Comprehensive Petroleum Underground Storage Tank Fund Bd. v. Shell Oil Co., 606 N.W.2d 376, 379 (Iowa 2000).
Generally, hearsay rulings are also reviewed for errors at law. State v. Ross, 573 N.W.2d 906, 910 (Iowa 1998) ("In the case of hearsay rulings, our review is for correction of errors at law because admission of hearsay evidence is prejudicial to the nonoffering party unless the contrary is shown."). However, when the basis for admission of hearsay evidence is the expert opinion rule, which provides no hard and fast rule regarding admissibility, we will employ an abuse of discretion standard. Hutchison v. Am. Family Mut. Ins. Co., 514 N.W.2d 882, 889 (Iowa 1994); Brunner v. Brown, 480 N.W.2d 33, 37 (Iowa 1992); see also In re Estate of Kelly, 558 N.W.2d 719, 722 (Iowa Ct.App.1996) (reviewing trial court's decision to admit hearsay evidence pursuant to expert opinion rule for an abuse of discretion).
III. Issues on Appeal
The admissibility of testimony and the jury instructions given both stem from the same issuewhether profits can be considered in determining the fair value of land in an eminent domain proceeding. The remaining issue will have us pass judgment on the admissibility of out-of-court statements in support of an expert's testimony.
A. Business Value Testimony in Eminent Domain Proceedings
What this issue involves is "just compensation." The Iowa Constitution requires *6 the state to provide just compensation to the owner of land affected by a taking. "Private property shall not be taken for public use without just compensation first being made, or secured to be made to the owner thereof, as soon as the damages shall be assessed by a jury...." Iowa Const. art. I, § 18. However, what constitutes just compensation has historically been an elusive question. 26 Am.Jur.2d Eminent Domain § 294, at 705 (1996).
The general rule states:
A court may consider all factors indicative of the value of the property, and which would have been present in the minds of a willing buyer and a willing seller, unless the considerations advanced are too speculative or remote, and thus not a necessary, natural, or proximate result of the taking.
Id. § 297, at 707-08 (footnotes omitted). This rule has been restated in our cases. "A jury may, of course, consider ... the advantages the land possesses which a seller would press to the attention of a buyer." Heins v. Iowa State Highway Comm'n, 185 N.W.2d 804, 807 (Iowa 1971). "When the entire property is taken, our general rule is that the measure of damage is the reasonable market value at the time of condemnation[,] ... [or] what a willing buyer would pay in cash to a willing seller...." Aladdin, Inc. v. Black Hawk County, 562 N.W.2d 608, 611-12 (Iowa 1997) (citation omitted).
However, our cases also place a limitation on what type of evidence a jury may hear when making its just compensation determination.
Where condemnation of a fee interest is sought, generally evidence of business profits is inadmissible as an [independent] element of damage or as relevant in determining the value of the land because it is too uncertain and depends upon too many contingencies.
... The fundamental reason for the exclusion of evidence of profits lies in the rule of substantive law that the condemnor takes only the real property, not the business located thereon.
The courts have generally stated that business profits are the result of so many factors and that their repercussion on the market is so remote, that the evidence is more likely to mislead than to aid in the determination of market value.
Twin-State Eng'g & Chem. Co. v. Iowa State Highway Comm'n, 197 N.W.2d 575, 578 (Iowa 1972) (citations omitted). "The profits of a business are too uncertain, and depend upon too many contingencies to safely be accepted as any evidence of the [useable] value of the property upon which the business is carried on." Wilson v. Iowa State Highway Comm'n, 249 Iowa 994, 1006, 90 N.W.2d 161, 169 (1958) (citation omitted); accord Comstock v. Iowa State Highway Comm'n, 254 Iowa 1301, 1308, 121 N.W.2d 205, 209 (1963) (determining that "[a]nticipated profit has too many variables including managerial skill to be" the measure of damages).
Several Iowa cases have recognized that business value may be a relevant factor when the property condemned is a leasehold. See Twin-State Eng'g, 197 N.W.2d at 582.
[W]e conclude such evidence as to the nature and prosperity of plaintiff's business was a proper item to be considered along with all facts, circumstances and elements disclosed by the evidence as tending to establish the reasonable value of the lease at the time it was taken. The evidence tended to be descriptive of the injury resulting to the leasehold by condemnation.
Id. (emphasis added).
When the state condemns the fee, however, our court has clearly recognized:
*7 "This court has, following the traditional rule, not allowed evidence concerning profits when only the fee is being condemned." City of Des Moines v. McCune, 487 N.W.2d 83, 84 (Iowa 1992). In McCune, we upheld the district court's rejection of evidence as to the "going-concern value" of a business on land condemned by the city. Id. In another case, we held that the district court's failure to sustain an objection made to testimony of profits and revenue of a business on the condemned property was an abuse of discretion. Wilson, 249 Iowa at 1006-07, 90 N.W.2d at 169. "[T]he profits of a business conducted upon land taken for the public use is not admissible in proceedings for the determination of compensation which the owner of the land shall receive." Id. at 1006, 90 N.W.2d at 169 (emphasis added) (citation omitted). The only exceptions we have recognized to this rule are leaseholds and land used for agricultural purposes. McCune, 487 N.W.2d at 84; Wilson, 249 Iowa at 1006-07, 90 N.W.2d at 169.
When the entire fee is condemned, the usual guide to the fair market value of the property is comparable sales figures. See Crozier v. Iowa-Ill. Gas & Elec. Co., 165 N.W.2d 833, 835 (Iowa 1969). This approach was utilized by the DOT's expert to arrive at his valuation of $182,500. Another approach that is employed is the cost approach, which looks at how much it would cost to build an identical building on identical land, depreciated by age. This approach was partially used by Kurth's expert, Winkel, who valued the land and building at $285,000. Kurth's second expert, Harden, then added that figure to a figure he arrived at using the capitalization of earnings approach. Kurth claims this method did not unduly consider business profits or the value of the business. We find that it did.
Harden explained that he was hired by Kurth to perform a business valuation. He informed the jury that he was valuing the business and the business property, which included tangibles like furniture and equipment and also intangibles like good will, the business name, and location. Specifically in this case, Harden was trying to determine how much the Wharf, operating as a restaurant, was worth. His method was meant to provide a figure to inform a buyer what he could expect to make if he was operating a similar business on the property. He arrived at this figure by looking at the "income stream" of the Wharf from 1994 through 1997. He admitted that he added estimated profits for the year of 1997 to his equation, which were not accounted for because the Wharf had to close earlier in the season than normal. He referred to the profits realized in the four years adjusted by the risk of business and other business assets as the normalized net income. Once this figure was determined, he stated the next step was "to anticipate what my future income from this property would be." Harden used the normalized past income to predict the normalized future income. This number was then capitalized by a flat rate resulting in a figure of $239,952. Harden characterized this as the commercial value of the property. On cross-examination, he admitted that his figure was partially based on past profits of the Wharf. When asked, "And that value under your method of analysis is based on the profits of the Wharf.... Right?" Harden replied, "That's the way the capitalization of earnings method is used. You use expected future earnings."
Certainly, evidence that the land is being used as a restaurant is highly relevant to the value of the land. See Olson v. United States, 292 U.S. 246, 256, 54 S.Ct. 704, 709, 78 L.Ed. 1236, 1245 *8 (1934). However, specific dollar figures as to how much profit the Wharf had made, as well as specific dollar figures guessing what it could make in the future are far too speculative and may not be provided to a jury in a fee condemnation proceeding. See McCune, 487 N.W.2d at 84. Accordingly, this information was inadmissible. Although we recognize that the capitalization of earnings method is a reliable formula for determining the value of a business, it is not a valid method for assessing just compensation in fee condemnation cases.
When inadmissible evidence is heard by the jury, the district court has abused its discretion. Whether this is grounds for a reversal depends upon our view of prejudice in these circumstances. In the context of eminent domain proceedings, we have said: "[W]here error appears in the admission of testimony prejudice will be presumed unless the contrary affirmatively appears." Steensland v. Iowa-Ill. Gas & Elec. Co., 242 Iowa 534, 540, 47 N.W.2d 162, 165 (1951). There is no prejudice when, "notwithstanding the illegal evidence, the competent evidence is such that the prevailing party is entitled to the verdict as a matter of law as being the only proper verdict that could be rendered." Id. at 541, 47 N.W.2d at 165-66.
Because no figure for the real estate alone, untainted by business profits, exceeds $285,000,[1] the jury clearly was persuaded by Harden's business value figure and compensated for it in its $375,000 verdict. See Stom v. City of Council Bluffs, 189 N.W.2d 522, 530 (Iowa 1971); see also 27 Am.Jur.2d Eminent Domain § 676, at 216 (1996) ("[T]he condemnation verdict or award cannot be higher than the highest estimate of the expert witnesses nor lower than the lowest."). As such, we cannot say that had this evidence been absent from trial, the jury would have arrived at the same verdict.[2]
B. Jury Instructions for Arriving at the Condemned Land's Value
When giving instructions to the jury, "the court must correctly state the law and confine it to [the facts]. A misstatement of the law in an instruction to a jury is reversible error." Heldenbrand v. Executive Council, 218 N.W.2d 628, 637 (Iowa 1974). "[T]he jury should not be informed of any matter which is not proper for it to consider in arriving at its verdict." 27 Am.Jur.2d Eminent Domain § 628, at 175. The DOT takes issue with three jury instructions.
*9 1. Jury Instruction No. 1
The relevant language of this instruction with the disputed portion emphasized reads:
It is undisputed that on August 5, 1997 the Iowa Department of Transportation condemned and on October 7, 1997 took possession of the complete property owned by Jerry Kurth d/b/a Fisherman's Wharf Restaurant.
Because the jury should not have heard evidence that equated the value of the business as property, the DOT argues that "complete property" is too broad. Literally, the complete property was taken, i.e., the land and the building which was a restaurant. The State condemned the entire fee. Nonetheless, we recognize that such a phrase may fail to distinguish that the government is not also taking the business. To minimize confusion in the future as to what the government is taking, the term "complete property" should not be used.
2. Jury Instruction No. 13, paragraphs 10 and 11.
The relevant language of this instruction with the disputed portion emphasized reads:
Factors you may consider in determining the fair and reasonable market value of the property are:
...
10. All competent facts which an owner would properly and naturally press upon the attention of a buyer with whom he is negotiating a sale of the property.
11. All competent facts which would naturally influence a person of ordinary prudence desiring to purchase the property.
This instruction is almost verbatim from Van Horn v. Iowa Public Service Co., 182 N.W.2d 365, 371 (Iowa 1970) and earlier from Korf v. Fleming, 239 Iowa 501, 517-18, 32 N.W.2d 85, 94-95 (1948). As such, it is an accurate statement of the law. The dispute with Instruction 13 comes from the fact that the jury heard inadmissible evidence that it may have been able to incorporate in this instruction. Inadmissible evidence and a later instruction may have had an impermissible effect on this instruction.
3. Jury Instruction No. 17
The relevant language of this instruction with the disputed portion emphasized reads:
There is evidence in this case as to certain net income derived from Plaintiff's operation of the Fisherman's Wharf Restaurant in the past. You are instructed that you are not to use such evidence as the measure of Plaintiff's damages, but you may consider such evidence only to the extent that you find that it does provide support, if any, for the estimates given herein as the fair market value of the property on August 5, 1997.
This is an accurate statement of the law in leasehold condemnation proceedings in Iowa. See Twin-State Eng'g, 197 N.W.2d at 578-82. However, what was condemned here was a fee, not a leasehold. First, the jury should never have been provided figures of net income. And second, allowing the jury to consider these figures for any purpose is a misstatement of the law in fee condemnation proceedings. See McCune, 487 N.W.2d at 84.
"In determining whether the jury was misdirected upon the measure of damages, all instructions will be read and considered together...." 27 Am.Jur.2d Eminent Domain § 636, at 179. Instruction 17 clearly tainted the other instructions given and allowed the jury to consider *10 inadmissible evidence. Reading all these instructions together, because of the instruction allowing the jury to consider net income, the court's instructions were improper and the error justifies a new trial.
C. Admission of a Letter Compiled by Out of Court Experts
Finally, a letter relied upon by two experts for Kurth was admitted into evidence. The DOT objects to its admission as hearsay. This letter was signed by five local real estate experts, only one of whom testified at the trial. Gary Carlson, the realtor who testified, compiled the letter, signed it, and obtained the signatures approving its content from four other local realtors. The letter was first referenced when Kurth's value expert, Greg Winkel, relied on statements made in this letter to form his value estimate of the real estate. The DOT made no objection to this testimony. The letter was not offered into evidence at this time.
Following Winkel's testimony, realtor Carlson also based his testimony on figures found in the letter with no objection. The letter was later offered into evidence. It was then that the DOT objected to it as hearsay. Kurth argues that this letter is admissible under Iowa Rule of Evidence 705. Rule 705 reads:
The expert may testify in terms of opinion or inference and give his reasons therefor without prior disclosure of the underlying facts or data, unless the court requires otherwise. The expert may in any event be required to disclose the underlying facts or data on cross-examination.
Iowa R. Evid. 705. This Rule specifically recognizes that an expert often relies on out-of-court statements or hearsay to form his opinion. Iowa Rule of Evidence 703 also acknowledges this point.
The facts or data in the particular case upon which an expert bases an opinion or inference may be those perceived by or made known to him at or before the trial or hearing. If of a type reasonably relied upon by experts in the particular field in forming opinions or inferences upon the subject, the facts or data need not be admissible in evidence.
Iowa R. Evid. 703. The value expert, Winkel, established that it is typical for him to rely on the recommendations of local realtors when arriving at a value estimate.
Although Rules 703 and 705 are silent as to whether this hearsay evidence is admissible, we are persuaded by the federal committee notes relating to similar federal rules. We have recognized: "According to the federal advisory committee, it was the intent of federal rule 705 to permit the introduction of `underlying facts or data' necessary to the expert's opinion." Brunner, 480 N.W.2d at 35 (emphasis added).
"[C]ourts and rule makers have yielded to the pressures of expediency so as to recognize a relaxation of the exclusion of otherwise inadmissible hearsay, to the extent that it may be considered as a part of the witness's legitimate cumulation of knowledge if the hearsay information is of that sort as is customarily relied upon by experts in the practice of their profession. The sanction of the general experience and reliability of the expert to sort out the acceptable information upon which he relies, from the unacceptable, is considered an adequate safeguard."
Id. at 35-36 (alteration in original) (citation omitted). Accordingly, admission of this letter may be characterized as "an indirect exception to the hearsay rule." Id. at 35 (citation omitted). As long as the expert can establish that this is the type of evidence reasonably relied upon by experts in his field, it should be admissible. As noted *11 above, Winkel did testify that it is typical for him to consult local realtors' data.
Further, there is another basis for admission of this letter. Because figures found in the letter came in without objection, admission of the letter was chiefly cumulative. See City of Dubuque, 590 N.W.2d at 496; see also State v. McKettrick, 480 N.W.2d 52, 60 (Iowa 1992) (holding "prejudice will not be found where substantially the same evidence is in the record without objection"). Given the legal support for admission of hearsay evidence in expert situations, introduction of this evidence was not an abuse of discretion.
In summary, the district court did not abuse its discretion by allowing the hearsay letter into evidence. However, the district court allowed the jury to hear inadmissible evidence. This was an abuse of discretion, and the DOT was prejudiced by this abuse. Finally, the jury was not properly instructed on the law and was allowed to factor inadmissible evidence into its verdict. For these reasons, the jury's decision must be reversed.
REVERSED AND REMANDED.
NOTES
[1] We recognize that this figure does not include the plaintiff's value for all his restaurant equipment. Most of the equipment's value was subsumed in Harden's approach, which we have already determined improperly factored in past and future profits. The value assessed to the equipment under this approach is not separable, making it impossible for us to speculate how much Winkel's figure might be elevated if he had valued the remaining equipment. However, given the DOT's uncontested valuation of the equipment at $33,000, we are confident that this adjustment to the $285,000 figure would never exceed $375,000, nor convince us that Kurth would have been entitled to this amount as a matter of law.
[2] The DOT's expert also briefly testified as to the Wharf's income for 1995 with a specific dollar amount to arrive at a valuation of $181,000 using the income valuation approach. This figure was then rejected by the same expert in favor of the comparable sales approach which provided a higher value for Kurth's land. This reference to the 1995 income by the DOT does not waive the argument the DOT is now making on appeal. Because this figure was discarded by the DOT's expert, the prejudice suffered by the plaintiff's expansive use of past profit figures was not mitigated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1010751/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 03-6426
JAMES C. MCFADDEN,
Petitioner - Appellant,
versus
STANLEY B. BURT, JR., Lieber Correctional
Institution; CHARLES M. CONDON, Attorney
General of South Carolina,
Respondents - Appellees.
Appeal from the United States District Court for the District of
South Carolina, at Columbia. Terry L. Wooten, District Judge.
(CA-02-83-25BC)
Submitted: May 29, 2003 Decided: June 4, 2003
Before WILKINSON, MICHAEL, and TRAXLER, Circuit Judges.
Dismissed by unpublished per curiam opinion.
James C. McFadden, Appellant Pro Se. William Edgar Salter, III,
OFFICE OF THE ATTORNEY GENERAL OF SOUTH CAROLINA, Columbia, South
Carolina, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
James C. McFadden seeks to appeal the district court’s order
denying relief on his petition filed under 28 U.S.C. § 2254 (2000).
An appeal may not be taken to this court from the final order in a
habeas corpus proceeding in which the detention complained of
arises out of process issued by a state court unless a circuit
justice or judge issues a certificate of appealability. 28 U.S.C.
§ 2253(c)(1) (2000). A certificate of appealability will not issue
for claims addressed by a district court on the merits absent “a
substantial showing of the denial of a constitutional right.” 28
U.S.C. § 2253(c)(2) (2000). As to claims dismissed by a district
court solely on procedural grounds, a certificate of appealability
will not issue unless the petitioner can demonstrate both “(1)
‘that jurists of reason would find it debatable whether the
petition states a valid claim of the denial of a constitutional
right’ and (2) ‘that jurists of reason would find it debatable
whether the district court was correct in its procedural ruling.’”
Rose v. Lee, 252 F. 3d 676, 684 (4th Cir. 2001) (quoting Slack v.
McDaniel, 529 U.S. 473, 484 (2000)). We have independently reviewed
the record and conclude that McFadden has not made the requisite
showing. See Miller-El v. Cockrell, 123 S.Ct. 1029 (2003).
Accordingly, we deny a certificate of appealability and dismiss the
appeal. We dispense with oral argument because the facts and legal
2
contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
DISMISSED
3 | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581554/ | 628 N.W.2d 80 (2001)
245 Mich. App. 427
PEOPLE of the State of Michigan, Plaintiff-Appellee,
v.
Walter James WILLIAMS, Defendant-Appellant.
Docket No. 226596.
Court of Appeals of Michigan.
Submitted April 10, 2001, at Grand Rapids.
Decided April 20, 2001, at 9:25 a.m.
Released for Publication June 18, 2001.
*81 Jennifer M. Granholm, Attorney General, Thomas L. Casey, Solicitor General, James A. Cherry, Prosecuting Attorney, and Aaron J. Mead, Assistant Prosecuting Attorney, for the people.
Jeanice Dagher-Margosian, Ann Arbor, for the defendant.
Before HOEKSTRA, P.J., and WHITBECK and COOPER, JJ.
WHITBECK, J.
Defendant Walter Williams pleaded guilty of unarmed robbery.[1] We granted his delayed application for leave to appeal. We affirm.
I. Basic Facts And Procedural History
Williams' conviction arises from an incident in December 1998 in which he and three others robbed two individuals at gunpoint. Williams, who was born on October 17, 1982, was charged as a juvenile with two counts of armed robbery[2] and two counts of possessing a firearm during the commission of a felony.[3]
The prosecutor moved to waive the jurisdiction of the Family Division of the Berrien Circuit Court (hereafter the family court) pursuant to the "traditional waiver" process because sixteen-year-old Williams was at least fourteen years old and the robbery, if committed by an adult, would be a felony[4] and because Williams had been previously tried and convicted of a *82 felony in the circuit court.[5] The family court found probable cause to believe that a robbery had been committed, that it would be a felony if committed by an adult, and that Williams committed the offense. However, the family court refused to hold a second hearing at which it would determine whether Williams' best interests and the public's best interests required continuing family court jurisdiction or a trial in the court of general jurisdiction (the Criminal Division of the Berrien Circuit Court, hereafter the circuit court). Rather, because Williams had been tried for a previous offense as an adult in a circuit court, the family court simply waived jurisdiction to the circuit court. In July 1999, Williams pleaded guilty of unarmed robbery in the Berrien Circuit Court, which sentenced him as an adult to six to fifteen years' imprisonment, without determining whether an adult sentence was in his best interests or the best interests of the public.
II. Preservation And Standard Of Review
On appeal, Williams contends that the circuit court erred in not holding a sentencing hearing pursuant to MCR 6.931 to determine whether to sentence him as an adult or a juvenile. He failed to preserve this issue for appellate review by raising it in the circuit court.[6] We presume without deciding that his argument alleges a constitutional error because it implicates the process to which he was due under the court rules and state statutes. Thus, our review is for plain error affecting his substantial rights.[7]
III. Statutory and Court Rule Construction
The issue presented in this case requires that we interpret and apply a variety of statutes and court rules. The interpretative rules, which govern both the court rules and the statutes at issue,[8] are familiar. If the language is unambiguous, this Court must enforce it without any further analysis.[9] Only when "reasonable minds" could disagree regarding the proper meaning of the statute or court rule does the Court have a role in interpreting it.[10] The language "should be construed reasonably" and the Court should keep the purpose of the statute or court rule in mind.[11]
IV. Traditional Waiver Cases
The prosecutor in this case used a traditional waiver process to transfer Williams' proceedings from the family court's jurisdiction to the circuit court's jurisdiction. To effect this jurisdictional change, the traditional waiver statute[12] ordinarily requires a two-phased waiver hearing. In the first phase of the hearing, the family court must
determine on the record if there is probable cause to believe that an offense has been committed that if committed by an adult would be a felony and if there is *83 probable cause to believe that the juvenile committed the offense.[13]
The family court in this case held this probable cause hearing.
The second phase of the traditional waiver process requires the family court to determine whether the best interests of the juvenile and the best interests of the public require a trial in the court of general jurisdiction rather than in the family court.[14] Although the Legislature has prescribed six criteria the family court must consider when making this best interests determination,[15] the family court retains the discretion to make the ultimate decision whether to waive jurisdiction over the juvenile.[16] However, subsection 5 of the traditional waiver statute separately provides that the family court "shall waive jurisdiction of the juvenile if the court finds that the juvenile has previously been subject to the jurisdiction of the circuit court" as a result of criminal conduct.[17] This mandatory waiver language makes the best interests determination conducted in a phase-two hearing irrelevant to a family court's decision to waive jurisdiction over a juvenile to the circuit court. Consequently, in accordance with the statutory scheme, the family court in this case did not conduct a phase-two hearing for Williams.
Following a conviction in the circuit court, the circuit court typically must determine whether to sentence a juvenile offender as an adult or as a juvenile.[18] The best interests criteria that the trial court considers are highly similar to the criteria used to determine whether trial as an adult in a court of general jurisdiction is appropriate.[19] However, MCR 6.901(B) makes it clear that this sort of sentencing hearing leaving open the possibility of an adult or juvenile sentence does not apply in cases in which the circuit court acquires jurisdiction pursuant to a traditional waiver process. The statement in MCR 6.901(B) that "[t]he rules [in subchapter 6.900 of the court rules] do not apply to a person charged solely with an offense in which the juvenile court has waived jurisdiction pursuant to M.C.L. § 712A.4; MSA 27.3178(598.4)" could not be plainer. The interpretation that Williams advances, which would withhold a sentencing hearing under MCR 6.931 in traditional waiver cases only if the family court had conducted a phase-two hearing concerning the best interests factors, is at odds with this language in MCR 6.901(B). In this situation, our duty is clear: we must enforce the language as written[20] and hold that the circuit court did not err in failing to hold a sentencing hearing under MCR 6.931 for Williams because the family court waived jurisdiction over Williams to the circuit court under M.C.L. § 712A.4.
Michigan Supreme Court precedent supports this holding. As the Supreme Court explained in People v. Veling:[21]
*84 The postconviction sentencing hearing does not apply to jurisdiction of minors that is waived to circuit court under the traditional procedures. People v. Cosby, 189 Mich.App. 461, 473 N.W.2d 746 (1991). Moreover, the court rules detailing the hearing process do not apply to jurisdiction of minors that is waived under the traditional procedures. See MCR 6.901(B).
Rather, the juvenile sentencing hearing described in MCR 6.931 only applies to an automatic waiver case, which is not the case here.[22]
V. Thenghkam
This Court's decision in People v. Thenghkam[23] recognizes that when a traditional waiver case proceeds pursuant to M.C.L. § 712A.4(5), as in this case, a juvenile must be tried and sentenced as an adult, explaining that
under Michigan law a minor can be (1) tried and sentenced as a juvenile, (2) tried as an adult and sentenced as a juvenile, or (3) tried and sentenced as an adult. Depending on the offense charged, the automatic waiver statute and the mandatory adult sentencing provision may require this third option. Similarly, if the juvenile was previously under the jurisdiction of the recorder's court or the circuit court, this third option is mandatory.[24]
Earlier in the Thenghkam opinion, this Court made what appears to be a contradictory statement concerning a circuit court's discretion to impose a juvenile sentence, stating:
A juvenile convicted of an offense in the circuit court pursuant to this waiver provision must be sentenced in accordance with M.C.L. § 769.1(3); MSA 28.1072(3), which permits the court to impose an adult or juvenile sentence on the basis of findings relevant to explicit criteria and the way the court weighs those findings. See also MCR 6.931.[25]
We believe that the Thenghkam panel,[26] when it referred to "this waiver provision,"[27] was referring to traditional waivers as a whole class of cases and not the special subset of traditional waiver cases that encompass juveniles who have been tried previously as adults. Nevertheless, the wording in this particular portion of the Thenghkam opinion makes it difficult to distinguish between the bulk of traditional waiver cases under M.C.L. § 712A.4 that proceed pursuant to subsection 4 of that statute and the fewer cases, like this case, that fall under subsection 5 of that statute.
Clearly, the statement in Thenghkam that implies that a circuit court may impose a juvenile sentence on a minor defendant who has previously been tried as an adult is dictum, and likely erroneous dictum at that.[28] The circuit court in *85 Thenghkam did not acquire jurisdiction over the minor defendant under M.C.L. § 712A.4(5).[29] Any suggestion that certain procedures apply in traditional waiver cases concerning juveniles who have been tried previously as adults is not binding because it was not essential to the disposition of the appeal in Thenghkam.[30]. Thus, we emphasize that we adhere to the statement in Thenghkam[31] that when a circuit court acquires jurisdiction over a juvenile pursuant to M.C.L. § 712A.4(5), it must impose an adult sentence. In such a case, the court rules and statutory scheme do not provide for a sentencing hearing that focuses on best interests factors because the lack of discretion in the form of sentencing makes the best interests determination irrelevant. With this in mind, it is apparent that Williams, who had already been tried and convicted as an adult by the time the circuit court sentenced him in this case, was not entitled to a sentencing hearing pursuant to MCR 6.931.
VI. Policy Considerations
Even the prosecutor acknowledges that this interpretation of the procedures required when a family court waives jurisdiction under M.C.L. § 712A.4(5) tends to increase the effect of the prosecutor's charging discretion and may lead to unfair results in other cases. For instance, if a prosecutor succeeds in having family court jurisdiction waived and tries a juvenile for a felony in the circuit court, the judge or jury may still acquit the juvenile, the prosecutor may drop the charges, or the circuit court may grant a motion to dismiss.[32] Nevertheless, if the prosecutor thereafter charges the juvenile for another felony, the juvenile must be tried as an adult and, if convicted, sentenced as an adult. This is so even though (a) the juvenile is not a recidivist, having never been convicted of a crime, and (b) a family court trial and a juvenile sentence may be appropriate under the facts of the case. This situation arises because circuit court jurisdiction, not conviction, triggers a trial in the circuit court and, ultimately, an adult sentence.[33] This puts juveniles who are tried for a relatively less serious felony pursuant to M.C.L. § 712A.4(5), even though they had never previously been convicted in an adult trial, in the same sentencing category as juveniles who are tried and convicted of the most heinous crimes under the modern automatic waiver statute.[34]
It may be, as Williams contends, that the Legislature and the Supreme Court intended M.C.L. § 712A.4(5) to interact with MCR 6.901(B) to preclude duplicative best interests hearings in a given case, rather than foreclosing the determination altogether. If so, they failed to make this intent clear. In other words, if the Supreme Court and the Legislature only intended to preclude juveniles in traditional *86 waiver cases who have a history of one or more criminal trials as an adult from having a phase-two hearing and a sentencing hearing, the scheme they set in place does not accomplish this goal. We think it possible that the Legislature and the Supreme Court intended only to have juveniles who were convicted of a felony following a trial in the circuit court, or those who pleaded guilty of a felony in the circuit court, treated this way. Evidence of recidivism may implicate some of the serious and legitimate concerns the Legislature has acknowledged in prescribing adult sentences for juveniles who commit serious crimes and who are subject to automatic waiver to the circuit court without the possibility of a juvenile sentence.
Nevertheless, the language in the relevant statutes and court rules is clear. Whether to change this language to allow a best interests sentencing determination for nonrecidivist juveniles convicted of a felony when they are tried in the circuit court pursuant to M.C.L. § 712A.4(5) is a policy decision. We encourage the Legislature to revisit this issue to ensure that this is the intended sentencing scheme and not an oversight that would allow an unfair and unintended result because the Legislature, not an intermediate appellate court, must make this sort of decision.
Affirmed.
NOTES
[1] MCL 750.530.
[2] MCL 750.529.
[3] MCL 750.227b.
[4] See M.C.L. § 712A.4(1).
[5] See M.C.L. § 712A.4(5).
[6] See, generally, People v. Hogan, 225 Mich.App. 431, 438, 571 N.W.2d 737 (1997).
[7] People v. Carines, 460 Mich. 750, 763-764, 597 N.W.2d 130 (1999).
[8] Bruwer v. Oaks (On Remand), 218 Mich.App. 392, 397, 554 N.W.2d 345 (1996).
[9] Kiesel Intercounty Drain Drainage Dist. v. Dep't of Natural Resources, 227 Mich.App. 327, 334, 575 N.W.2d 791 (1998).
[10] See id.
[11] Barr v. Mt. Brighton Inc., 215 Mich.App. 512, 516, 546 N.W.2d 273 (1996).
[12] MCL 712A.4(3) and (4).
[13] MCL 712A.4(3); see also MCR 5.950(B)(1).
[14] MCL 712A.4(4); see also MCR 5.950(B)(2).
[15] MCL 712A.4(4)(a)-(f); see also MCR 5.950(B)(2)(d)(i)-(vi).
[16] See, generally, In re Le Blanc, 171 Mich.App. 405, 412, 430 N.W.2d 780 (1988).
[17] MCL 712A.4(5).
[18] MCL 769.1(3); see also MCR 6.931.
[19] Compare M.C.L. § 769.1(3)(a)-(f) and MCR 6.931(E)(3)(a)-(f) with M.C.L. § 712A.4(4)(a)-(f) and MCR 5.950(B)(2)(d)(i)(vi).
[20] See Kiesel Intercounty Drain Drainage Dist, supra at 334, 575 N.W.2d 791.
[21] People v. Veling, 443 Mich. 23, 39, n. 19, 504 N.W.2d 456 (1993).
[22] See People v. Hana, 443 Mich. 202, 224, 504 N.W.2d 166 (1993); see also People v. Parrish, 216 Mich.App. 178, 183, n. 1, 549 N.W.2d 32 (1996).
[23] People v. Thenghkam, 240 Mich.App. 29, 40, 610 N.W.2d 571 (2000).
[24] Id. (emphasis added).
[25] Id. at 38-39, 610 N.W.2d 571 (emphasis added).
[26] Judges Hoekstra and Whitbeck were members of the Thenghkam panel and Judge Whitbeck authored the opinion.
[27] Thenghkam, supra at 39, 610 N.W.2d 571.
[28] Error of this type is particularly annoying, rather like a buzzing insect that simply begs for the flyswatter. Like Roger J. Traynor, we observe:
"Errors are the insects in the world of law, traveling through it in swarms, often unnoticed in their endless procession. Many are plainly harmless; some appear ominously harmful. Some, for all the benign appearance of their spindly traces, mark the way for a plague of followers that deplete trials of fairness." [Roger J. Traynor, The riddle of harmless error, p. ix (1970), quoted in Foley & Filiatrault, The riddle of harmless error in Michigan, 46 Wayne L. R. 423, 424 (2000).]
[29] Thenghkam, supra at 41, 610 N.W.2d 571.
[30] See People v. Squires, 240 Mich.App. 454, 458, 613 N.W.2d 361 (2000).
[31] Thenghkam, supra at 40, 610 N.W.2d 571.
[32] We do not intend to define all instances when a circuit court may exercise jurisdiction over a juvenile without a conviction.
[33] MCL 712A.4(5).
[34] See M.C.L. § 769.1(1). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581558/ | 628 N.W.2d 605 (2001)
AMERICAN FAMILY INSURANCE COMPANY, Respondent,
v.
Andy WALSER, Respondent,
Matthew Jewison, a minor by and through Gary Jewison, his parent and natural guardian, et al., Petitioners, Appellants,
Jason Shoemaker, Blue Cross and Blue Shield of Minnesota, Respondents.
No. C1-00-349.
Supreme Court of Minnesota.
July 5, 2001.
*606 Philip R. Reitan, Mankato, for appellant.
Steven J. Hovey, Hoversten, Johnson, Beckmann, Wellman & Hovey, LLP, Austin, for respondent American Family Ins. Co.
Jane McMahon, St. Paul, for respondent Blue Cross Blue Shield.
Andy Walser, Mapleton, pro se.
Jason Shoemaker, Fort Sill, OK, pro se.
Heard, considered, and decided by the court en banc.
OPINION
PAUL H. ANDERSON, Justice.
Appellant Matthew Jewison was injured after falling from the rim of a basketball hoop from which he had been hanging by his hands. Jewison fell because two of his acquaintances pulled on his ankles, causing him to lose his grip on the rim. After receiving medical treatment and therapy for the injury, Jewison sued the two acquaintances, one of whom was covered by a homeowner's policy issued by American Family Insurance. American Family then initiated a declaratory judgment action, alleging that it had no duty to defend or indemnify. American Family argued that no coverage existed under the policy for *607 the insured's actions because the insured acted intentionally, even if he did not intend to harm Jewison. The district court concluded as a matter of law that the insured's actions were intentional, but that the resulting injury was not intentional, and therefore, American Family had a duty to defend and indemnify the insured. The Minnesota Court of Appeals reversed, concluding that there was no coverage because the insured committed a tortious act, the act was intentional, and therefore the act could not be considered an accident. We reverse.
On May 6, 1996, Matthew Jewison, Andy Walser, Jason Shoemaker, and other students were in a gym at the Mapleton High School. At the time, Jewison was in the ninth grade, Walser was in the tenth grade, and Shoemaker was in the twelfth grade. The three were in the gym because their choir teacher had asked them to move some chairs.
Jewison gave the following version of what happened in the gym. Jewison, who was about 6 feet 4 inches tall, jumped up and began hanging by his hands from the rim of a basketball hoop. After hanging from the rim for about 5 to 10 seconds, Walser and Shoemaker grabbed Jewison's ankles and began tugging on them. Jewison characterized their actions as "just goofing around" and "playing around and stuff." Walser and Shoemaker were standing under the basketball hoop facing Jewison as they held his ankles. Walser and Shoemaker backed up a bit while holding Jewison's ankles, but then let go. Jewison held onto the rim for another 10 to 20 seconds and then Walser and Shoemaker grabbed Jewison's ankles another time. Walser and Shoemaker again backed up while holding Jewison's ankles, "pulled harder," and this time Jewison lost his grip on the rim and fell to the floor. After Jewison lost his grip but before he hit the floor, Walser and Shoemaker let go of his ankles. Jewison, "by instinct," used his left hand to break his fall, injuring the middle finger in his left hand. Walser and Shoemaker both apologized to Jewison and when asked if he thought Walser and Shoemaker intended to injure him, Jewison responded, "No, not at all."
Walser's version of what happened differed only slightly from Jewison's. Walser stated that Jewison jumped up and grabbed the rim a couple of times before the incident happened. On the last time Jewison jumped up, he hung on the rim. Walser told him to get down because he was not supposed to be hanging from the rim. Walser stated that he and Shoemaker each grabbed one of Jewison's ankles, but he could not recall if they pulled Jewison in any specific direction. Walser thought that he and Shoemaker pulled Jewison "close to straight down." Walser gave the following description of how Jewison fell. "I think he landed a little bit on his feet first and then kind of pushed himself backwards. And that was when he put his arms back."
Walser stated that he and Shoemaker were just "goofing around" and did not have any hostile feelings toward Jewison; instead, everything was done in a friendly manner. Walser stated that although he and Shoemaker intended to pull Jewison down from the rim, they did not intend to injure him. Walser agreed with the statement that his pulling on Jewison's ankles was "[j]ust one of the things that high schoolers may do."
Jewison testified that he had jumped up and hung on basketball rims "hundreds" of times before the May 1996 incident. In all of those times, he never injured himself doing so. Nor had he ever witnessed anyone else get injured from holding onto the rim and then falling down. Walser testified that before the May 1996 incident, he *608 jumped up and hung from basketball rims a "couple dozen" times. He also witnessed others doing the same thing. Although the Mapleton basketball coaches had told the students not to hang from the rims, Walser had never seen anyone injured from doing so before Jewison was injured.
In his fall from the basketball rim, Jewison injured his third metacarpal knuckle. For 6 months after the fall, Jewison received therapy for this injury. Jewison's medical insurer, Blue Cross Blue Shield, paid $8,399.40 in medical bills as a result of his injury. Jewison and his father commenced an action against Walser and Shoemaker to recover these losses. Walser, who was insured through his parents' policy with American Family, tendered his defense to the insurance company.
American Family initiated a declaratory judgment action, asking the district court to conclude that American Family had no duty to defend or indemnify Walser. American Family asserted two reasons why it should not have such a duty. First, American Family argued that its policy does not cover the May 1996 incident because it was not an "occurrence" as defined in the coverage provision of the policy. Second, American Family asserted that the incident was the result of an intentional act by Walser and therefore coverage was excluded by the intentional act exclusion.
The parties agreed to submit the matter to the district court based on Jewison's and Walser's depositions. Relying on Hauenstein v. St. Paul-Mercury Indem. Co., the court found that Jewison's injury was caused by an accident because it was "an unexpected, unforeseen, or undesigned happening or consequence * * *." 242 Minn. 354, 358, 65 N.W.2d 122, 126 (1954). The court also found that while Walser intended to pull Jewison down from the rim, he did not intend to injure Jewison. The court stated that as a matter of law Walser's actions "were intentional but the resulting injury was both unexpected and unintended and was therefore an accident." Further, the court found that the facts in this case did not warrant inferring intent to injure as a matter of law. The court then went on to conclude that as a matter of law the incident was an occurrence for purposes of the American Family policy, so coverage did exist and American Family had a duty to defend and indemnify Walser.
American Family appealed to the court of appeals. The court of appeals reversed in an unpublished opinion, concluding that Walser and Shoemaker committed an intentional tort when they grabbed Jewison's ankles. Am. Family Ins. Co. v. Walser, No. C1-00-349, 2000 WL 1182799, at *2 (Minn.App. Aug. 22, 2000). The court reasoned that because the injury resulted from an act that was both intentional and wrongful, it could not be considered an accident. See id. Therefore, the incident was not an occurrence as required for coverage under American Family's policy. Id. In reaching this conclusion, the court focused on whether Walser intended to act and in doing so acted wrongfully, not on whether Walser intended the harm. Id. The court then stated that it was unnecessary to decide whether the incident would also be excluded from coverage through the intentional act exclusion provision because of the court's conclusion that coverage did not exist in the first place. Id. at *2, n. 2. However, the court did note in a footnote that intent to injure could be inferred as a matter of law under the circumstances in this case. Id. at *2, n. 1.
Jewison appealed and argues that because Walser had no intent to injure him, the incident in which he was injured was an accident under the American Family policy. He also asserts that this is not an *609 incident in which intent to injure should be inferred as a matter of law.
I.
Interpretation of an insurance policy and application of the policy to the facts in a case are questions of law that we review de novo. Franklin v. Western Nat'l Mut. Ins. Co., 574 N.W.2d 405, 406 (Minn.1998). When interpreting an insurance contract, words are to be given their natural and ordinary meaning and any ambiguity regarding coverage is construed in favor of the insured. Hauenstein, 242 Minn. at 357, 65 N.W.2d at 125.
There are two provisions of the American Family policy relevant to this appeal. The first is the coverage provision, which requires that Jewison must have been injured in an occurrence. The policy contains the following coverage terms under "Description of Liability and Medical Expense Coverages":
1. Insuring Agreement. We will pay, up to our applicable limit, compensatory damages which any insured becomes legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies. The bodily injury or property damage must be caused by an occurrence during the policy period. The occurrence must take place in the coverage territory.
(Emphasis omitted.) The coverage provision of the policy also provides the following definition of occurrence:
Occurrence means an accident, including continuous or repeated exposure to substantially the same general harmful conditions.
(Emphasis added.)
The second provision of the policy relevant to this appeal is the exclusionary provision, which is included under the "Exclusions" section of the policy. This provision contains the following language:
11. Intentional Injury. We will not pay for damages due to bodily injury or property damage expected or intended from the standpoint of the insured.
(Emphasis omitted.)
The coverage provision of American Family's policy provides coverage for damages resulting from an occurrence, which the policy defines as an accident. However, the policy does not define accident. In interpreting the word accident, we are guided by the maxim that in insurance contracts, coverage provisions are construed according to the expectations of the insured and exclusions are construed narrowly. Atwater Creamery Co. v. Western Nat'l Mut. Ins. Co., 366 N.W.2d 271, 276 (Minn.1985). When applying this maxim to coverage provisions of an accident policy, we established that the word accident encompasses both the acts of the insured and the consequences of the insured's acts. Hauenstein, 242 Minn. at 358-59, 65 N.W.2d at 126. In Hauenstein, we concluded that an insurance policy did provide coverage for damage caused to the walls of a building by the application of defective plaster. 242 Minn. at 358, 65 N.W.2d at 126. We reasoned that the damage was accidental because it was a "completely unexpected and unintended result." Id. We concluded that "[a]ccident, * * * within the terms of an accident policy, is an unexpected, unforeseen, or undesigned happening or consequence * * *." 242 Minn. at 358-59, 65 N.W.2d at 126.
In 1976, when considering the Hauenstein definition of accident, we noted that "this definition or a similar one is universally accepted by the courts * * *." Bituminous Cas. Corp. v. Bartlett, 307 Minn. 72, 80 n. 5, 240 N.W.2d 310, 313, n. 5. We also noted the difficulties that the Hauenstein *610 definition has caused courts in interpreting insurance provisions. Bartlett, 307 Minn. at 80, 240 N.W.2d at 313. We mentioned accident definitions from other jurisdictions, including one which defined accident as "all negligently caused injury, provided such injury was not intentional," but we did not endorse any of these other definitions. Id. Because the policy at issue in Bartlett provided its own definition of accident, we did not need to resolve any problems with the Hauenstein definition. Bartlett, 307 Minn. at 80, 240 N.W.2d at 313. But, while we did not rely on the Hauenstein definition of accident to reach our decision in Bartlett, our analysis indicated that the Hauenstein language was not applicable because there was specific contract language defining accident. Bartlett, 307 Minn. at 80, 240 N.W.2d at 313. The Hauenstein definition of accident includes circumstances where the injury was unintended or unexpected. Hauenstein, 242 Minn. at 358-59, 65 N.W.2d at 126. But we note that the Hauenstein definition did not focus on whether the conduct that caused the injury was intentional. Hauenstein, 242 Minn. at 358-59, 65 N.W.2d at 126.
Following Hauenstein and Bartlett, the court of appeals strayed from the Hauenstein definition in a series of cases interpreting coverage provisions. The first case, Sage Co. v. INA, involved an insurance claim by a partnership in an employment discrimination suit resulting from firing an employee. 480 N.W.2d 695, 697 (Minn.App.1992). In deciding whether the intentional firing of an employee was an accident under the policy, the court of appeals used only part of the Hauenstein definition, stating that an accident is "an unexpected, unforeseen, or undesigned happening * * *." Sage, 480 N.W.2d at 698. The court in Sage did not explain why it dropped the words "or consequence" from the Hauenstein definition. Id. Two months later, the court of appeals relied on the shortened definition of accident from Sage when it decided a case involving the transmission of herpes. Milbank Ins. Co. v. B.L.G., 484 N.W.2d 52, 58 (Minn.App.), rev. denied (Minn. July 16, 1992). In Milbank, the court of appeals also took from Bartlett a definition of accident that we referenced but did not adopt in Bartlett. Milbank, 484 N.W.2d at 58. This definition stated that an accident "includes all negligently caused injury, provided such injury was not intentional." Id.
Relying on Sage and Milbank, the court of appeals developed a new test for determining whether an incident was an accident. This test involves ascertaining whether the insured's conduct was wrongful. Gilman v. State Farm Fire & Cas. Co., 526 N.W.2d 378, 383 (Minn.App.1995). In Gilman, the jury found that the insured intentionally tackled Gilman, but that the resulting injury was not intentional. Id. at 381. In considering the impact of the jury verdicts on coverage, the court of appeals discussed for the first time the fact that it had dropped the words "or consequence" from the Hauenstein definition of accident, but distinguished Hauenstein as a property damage case that did not involve "wrongful conduct." Gilman, 526 N.W.2d at 382. The court concluded that because the act of tackling was a tortious and nonconsensual act, it would not be considered an accident, even if the insured did not intend to injure. Id. at 383. When the court of appeals decided the present case, it followed the Gilman test and concluded that because Walser's conduct was tortious, lack of intent to injure was irrelevant when determining whether the incident at issue was an accident. Walser, 2000 WL 1182799, at *2.
During this same time period, we developed a related analysis that we have used in determining whether an insured acted *611 intentionally for purposes of an intentional act exclusion in an insurance policy. In order for coverage to be excluded as intentional, a court must find that the insured acted with "specific intent to cause" harm and that the insured "intended the harm itself, not merely that the insured generally intended to act." R.W. v. T.F., 528 N.W.2d 869, 873 (Minn.1995).[1] When applying this principle, we inquire into the intentions of the insured, but we do not inquire whether the insured's conduct was wrongful. E.g., see id. Thus, there is coverage for an incident "when the act inflicting the assault and battery is intended, but the resulting injury is not intended." Woida v. N. Star Mut. Ins. Co., 306 N.W.2d 570, 573 (Minn.1981). We note, though, that to find that an insured acted intentionally, a court need only find that the insured intended some harm, not that the insured intended the specific harm that resulted. Iowa Kemper Ins. Co. v. Stone, 269 N.W.2d 885, 887 (Minn.1978).
After considering our jurisprudence and the court of appeals' analysis leading to the definition of the word accident, we reject the court of appeals' analysis because it excludes the inquiry into whether there was intent to injure. The result of the application of the court of appeals' test from Gilman is that the coverage analysis is more restrictiveresults in narrower coveragethan our intentional act exclusion analysis. This result is problematic, and the court of appeals recognized the need to avoid this illogical result in Milbank when it stated, "[i]t makes little sense to give a narrower reading to `occurrence' than we do to an exclusion from coverage for the `occurrence.'" 484 N.W.2d at 58. In addition, the test used in Gilman departs from our precedent in Hauenstein and Bartlett. The court of appeals' rationale that Hauenstein involved property damage rather than personal injury is not sufficient justification for a more stringent test for coverage. Nor does the characterization of conduct as tortious or wrongful support the imposition of a narrower definition of accident when evaluating coverage. All conduct that leads to liability for personal injury or property damage is in some sense tortious or the defendant would not be liable. To the extent that wrongful conduct may warrant different treatment, it makes more sense to address it in the context of an intentional act exclusion.
We conclude that the Hauenstein definition of accident as an unexpected, unforeseen, or undesigned happening or consequence remains applicable and should have been used in the present case. While we reject the court of appeals' narrower definition of accident, we are mindful of our acknowledgment in Bartlett that the Hauenstein definition has proved troublesome in application. We believe that the appropriate solution is to recognize the relationship between the definition of accident in the analysis of coverage provisions and the definition of intentional conduct in the analysis of intentional act exclusions. It would be preferable-at least in terms of common sense expectations of the meaning of contractual provisions-that a general coverage provision provide a broad scope of coverage that is then limited by a specific exclusion. However, in the absence of a workable definition of accident that yields such a result, it is better here to acknowledge that accidental conduct and intentional conduct are opposite sides of the same coin. The scope of one in many respects defines the scope of the other. *612 Therefore, in applying the Hauenstein definition of accident to a coverage provision, particularly the unexpected, unforeseen or undesigned consequence aspect, our cases interpreting intentional act exclusions are instructive; that is, where there is specific intent to cause injury, conduct is intentional for purposes of an intentional act exclusion, and not accidental for purposes of a coverage provision. As was the case under the Hauenstein definition, where there is no intent to injure, the incident is an accident, even if the conduct itself was intentional.
Reconciling the scope of the coverage concept of accident and the exclusion concept of intentional act exclusions is not a new idea. In Tower Ins. Co. v. Judge, the U.S. District Court, reviewing Minnesota law, stated that "the question whether [the victim's] death was an `accident' and the question whether the intentional act exclusions apply are, for all practical purposes, identical issues." 840 F.Supp. 679, 690 (D.Minn.1993). Other state courts have also adopted like inquiries for the determination of whether an event is an accident and whether an insured acted intentionally. E.g., Physicians Ins. Co. of Ohio v. Swanson, 58 Ohio St.3d 189, 569 N.E.2d 906, 908 (1991); see Lititz Mut. Ins. Co. v. Bell, 352 Md. 782, 724 A.2d 102, 110 (1999); Fire Ins. Exch. v. Diehl, 450 Mich. 678, 545 N.W.2d 602, 605-06 (1996). Additionally, some insurance policies combine the coverage and intentional act exclusion issues into one provision. E.g., Woida, 306 N.W.2d at 572-73 (where the policy defined an occurrence as "an accident * * * neither expected nor intended from the standpoint of the insured"). Finally, we have used the word accident in automobile policies to mean an "unexpected happening without intention or design" and suggested that the use of the term accident in the no-fault act may have been intended to incorporate an intentional act exclusion. Weis v. State Farm Mut. Auto. Ins. Co., 242 Minn. 141, 145, 64 N.W.2d 366, 368 (1954); McIntosh v. State Farm Mut. Auto. Ins. Co., 488 N.W.2d 476, 477-79 (Minn.1992).
We do not conclude or suggest that the scope of coverage for accidents will always coincide with the scope of an exclusion for intentional acts. Rather, we conclude that in analyzing whether there was an accident for purposes of coverage, lack of specific intent to injure will be determinative, just as it is in an intentional act exclusion analysis.[2]
Here, the American Family policy provides coverage for bodily injury caused by an occurrence, which in turn is defined as an accident. When the policy is construed with our definition of accident, the policy provides coverage for bodily injury caused by an incident in which the resulting harm was unintended or unexpected by *613 the insured. To determine whether Jewison's injury was unintended by Walser, we must determine whether Walser acted with specific intent to cause Jewison's injury. R.W., 528 N.W.2d at 872. The district court found that although Walser acted intentionally, he did not intend to injure Jewison. There is nothing in the record to suggest that this finding was in error, nor has American Family argued that it was. Therefore, we conclude that Jewison was injured in an accident. Based on the language of the policy, our definition of accident, and the finding of the district court, we hold that Jewison was injured in an occurrence as defined by the coverage provision of American Family's policy.
II.
Our conclusion that Jewison has shown that the May 1996 incident falls within the coverage provision of American Family's policy does not end our inquiry. We next must consider whether the exclusionary provision of American Family's policy should operate to deny coverage. When interpreting insurance policies, we construe language in an exclusionary provision in accordance with the expectations of the insured party. American Family Mut. Ins. Co. v. Peterson, 405 N.W.2d 418, 422 (Minn.1987). We also construe exclusions strictly against the insurer. Bob Useldinger & Sons, Inc. v. Hangsleben, 505 N.W.2d 323, 327 (Minn.1993).
The district court found that Walser acted intentionally, but that he did not have specific intent to injure Jewison. We already have concluded that this finding was not erroneous. We have stated that the purpose of intentional act exclusions is to exclude insurance coverage for wanton and malicious acts by an insured, and therefore we may, absent a finding of specific intent to injure, infer intent to injure as a matter of law. Farmers Ins. Exch. v. Sipple, 255 N.W.2d 373, 375-76 (Minn.1977). We do so based on the circumstances and nature of the insured's actions. R.W., 528 N.W.2d at 873. Therefore, in this case, because there is no actual intent to injure, the intentional act exclusion will only defeat coverage if there is a basis to infer intent to injure as a matter of law.
We have previously stated that the inference of intent to injure as a matter of law arises when the insured acted in a calculated and remorseless manner or when the insured's actions were such that the insured knew or should have known that a harm was substantially certain to result from the insured's conduct. Cont'l Western Ins. Co. v. Toal, 309 Minn. 169, 177-78, 244 N.W.2d 121, 126 (1976); R.W., 528 N.W.2d at 873. The mere fact that the harm was a "natural and probable consequence" of the insured's actions is not enough to infer intent to injure. Toal, 309 Minn. at 174, 244 N.W.2d at 124.
There is no bright line rule as to when a court should infer intent to injure as a matter of law; rather, the determination is made through a "case by case factual inquiry." R.W., 528 N.W.2d at 873. In Brown v. State Auto. & Cas. Underwriters, we were asked to infer intent to injure when the insured struck a baggage clerk after an argument and tug-of-war over a piece of luggage. 293 N.W.2d 822, 823-25 (Minn.1980). In concluding it was not appropriate to infer intent to injure under those circumstances, we noted that the cases in which we inferred intent to injure were "factually more extreme." Id. at 824. In Caspersen v. Webber, we declined to infer intent to injure because even though the insured intentionally pushed a hatcheck girl, causing her to be injured, the character of the insured's act was not such that an intent to injure could be inferred as a matter of law. 298 Minn. 93, 98-99, 213 N.W.2d 327, 330 (1973). The court of *614 appeals has also recognized that inferring intent to injure is not appropriate in all circumstances. German Mut. Ins. Co. v. Yeager, 554 N.W.2d 116, 118 (Minn.App.), rev. denied (Minn. Dec. 23, 1996). In Yeager, the court of appeals declined to infer intent when the insured was a teenager who injured a friend while exploding an explosive device when the insured had exploded such a device in the past without injuries and the insured threw the device away from bystanders. Id.
This case by case factual inquiry has led us to infer intent to injure as a matter of law in certain circumstances. In Woida, we inferred intent to injure when the insured drove to a construction site armed with a high-powered rifle loaded with armor-piercing bullets and fired at a guard's truck, which he knew was occupied. 306 N.W.2d at 573-74. In Toal, we inferred intent to injure when the insured armed himself with loaded weapons to facilitate a robbery. 309 Minn. at 177, 244 N.W.2d at 126. We concluded that the robbery was a "well planned operation" in which the insured knew that "someone might well be injured or killed" and thus the insured's actions were "of such a calculated and remorseless character" that it was appropriate to infer intent to injure as a matter of law. Id.
We also have inferred intent to injure in a number of cases involving some type of sexual contact. In R.W., we inferred intent to injure when the insured had unprotected sexual intercourse even though he knew or should have known that he had herpes. 528 N.W.2d at 873. We reasoned that T.F.'s decision to engage in unprotected sexual intercourse knowing of the high probability that he could infect R.W. with herpes made the transmission of herpes an intentional act as a matter of law. Id. In Fireman's Fund Ins. Co. v. Hill, we inferred intent to injure when the insured had sexual contact with a minor foster child placed in his home. 314 N.W.2d 834, 835 (Minn.1982). We based this conclusion on the fact that "Hill intended to engage in sexual play" knowing that the welfare department viewed sexual contact as detrimental to the child and that Hill had been confronted with accusations that he had assaulted children in the past. Id.
These cases provide examples of situations where there was a basis to infer intent to injure. In each case, the insureds acted in a manner in which they knew or should have known that some harm was substantially certain to result; that is, they acted with deliberate and calculated indifference to the risk of injury. R.W., 528 N.W.2d at 873; Hill, 314 N.W.2d at 835; Woida, 306 N.W.2d at 573-74; Toal, 309 Minn. at 177, 244 N.W.2d at 126. Therefore, we conclude that in order to infer as a matter of law that Walser intended to injure Jewison, we must conclude that Walser acted with deliberate and calculated indifference to the risk of injury to Jewison.
The district court concluded as a matter of law that it could not infer that Walser intended to injure Jewison. We agree with this conclusion. After comparing the facts in this case to those in which we have inferred intent to injure in the past, we conclude, as we did in Brown, that the cases in which we infer intent to injure are factually more extreme than those presented here. Jewison, Walser, and Shoemaker were teenage boys "goofing around" in a high school gym. The record shows that both Jewison and Walser had hung by their hands from a rim of a basketball hoop on numerous occasions and had witnessed others doing so, but neither of them had ever seen anyone injured from a fall from a rim. Jewison testified that he had fallen while attempting to hang from the rim in the past, and *615 even though he had occasionally not landed on his feet, he was never injured from such falls. There is nothing in the record to suggest that Walser acted with deliberate and calculated indifference to the risk of injury to Jewison. Following the reasoning we used in Toal, Walser's actions were more like those of the insured in Caspersenimpulsive actions which resulted in an unintentional injury. 244 N.W.2d at 126 (referring to Caspersen, 298 Minn. at 98-99, 213 N.W.2d at 330). Therefore, we conclude that intent to injure should not be inferred as a matter of law. Because we have concluded that there was no actual intent or expectation to injure and that intent to injure should not be inferred in this case, the intentional act exclusion in the American Family policy does not exclude coverage. We hold that the district court was correct when it found that American Family has a duty to defend Walser and to indemnify him for any judgment rendered against him.
Reversed and remanded.
STRINGER, Justice (dissenting).
I respectfully dissent. The insurance policy at issue here provides coverage if the insured becomes legally obligated to pay damages for "bodily injury or property damage * * * caused by an occurrence during the policy period." The term "occurrence" is defined in the policy as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." The policy also states that it "will not pay for damages due to bodily injury or property damage expected or intended from the standpoint of the insured." Under the language of the insurance policy, it makes no difference whether the insured intended injury or notthe only concern is whether the act causing the injury was accidental or intentional.
It is undisputed that Jewison, a ninth grade student, was injured when he fell from where he was hanging from the rim of a basketball hoop to a gymnasium floor. It is also undisputed that Walser, a sophomore, and Shoemaker, a senior, deliberately and repeatedly tugged at Jewison's ankles in an attempt to get him down from the basketball rim. Jewison testified that the boys backed up while pulling on his ankles so that he hung from the rim at an angle. Walser acknowledged they might have been pulling Jewison's legs at an angle. Jewison fell when, after repeated attempts to dislodge Jewison from the basketball rim, Walser and Shoemaker both took hold of his ankles and pulled harder and at an angle from a direct line to the floor, causing him to lose his grip.
Beginning, as we must, with the language of the policy, Franklin v. Western Nat'l Mut. Ins. Co., 574 N.W.2d 405, 407 (Minn.1998), the American Family insurance agreement provides:
We will pay, up to our applicable limit, compensatory damages which any insured becomes legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies. The bodily injury or property damage must be caused by an occurrence during the policy period. The occurrence must take place in the coverage territory.
(emphasis removed). An occurrence, under the policy definition, is "an accident * * *." Thus the policy provides coverage for bodily injury "caused by an accident." "Accident," as we defined it in Hauenstein, "is an unexpected, unforeseen, or undesigned happening or consequence * * *." 242 Minn. at 358-59, 65 N.W.2d at 126. Where the majority errs is in concluding that "an accident" is a "consequence" it is not, and that analysis ignores the plain policy language stating that "an accident" *616 must be the cause of the bodily injury. Clearly, Jewison's injury here was not caused by an accident for the simple reason that Walser and Shoemaker acknowledged that they intended to pull Jewison from the rim of the basketball hoop. His fall was not "an unexpected, unforeseen, or undesigned happening or consequence" it was fully intended. Thus, under the plain language of the insurance policy here, I would conclude there is no coverage.
Coverage is also barred by the intentional acts exclusion. Paragraph 11 of the American Family policy provides an exclusion for intentional injury: "We will not pay for damages due to bodily injury or property damage expected or intended from the standpoint of the insured." (emphasis in original). Jewison characterized the incident as "just goofing around." An inference of intent to cause bodily injury arises and the insured's conduct falls within the intentional injury exception of an accident policy however where the insured's actions are such that the insured knew or should have known "that harm was substantially certain to result" from that conduct. See, e.g., R.W. v. T. F., 528 N.W.2d 869, 872 (Minn.1995); State Farm Fire & Cas. Co. v. Wicka, 474 N.W.2d 324, 329 (Minn.1991).
The majority strains to redefine the common sense notion of accident to reach the conclusion that because the injury was not specifically intended, the event must have been an accident.[1] But when Walser and Shoemaker repeatedly pulled on Jewison's ankles, they accomplished precisely what they intended to cause him to lose his grip on the hoop and to fall. Where does their intentional conduct end just before Jewison crashed to the floor injuring himself? How does what Walser and Shoemaker did here differ from pushing Jewison to get him off a ledge injury is likely if not certain to occur. Jewison's fall from the basketball rim was not an accident. It was the foreseeable and expected result of repeated tugs on his ankles by his two older classmates pulling at an angle below him on the floor. Indeed, it is difficult to imagine a scenario in which injury is more likely to occur than where a young boy is hanging by his hands from a narrow metal rim several feet above a hard floor and his feet are pulled at an angle from under him by the two older boys, causing his fall. Only a suspension of the law of gravity could have interceded to prevent the ensuing injury.
The majority states that an insured's conduct does not fall within the intentional injury exception unless the insured "acted with deliberate and calculated indifference to the risk of injury." Evidence of deliberate and calculated indifference to the inherent risks of an action taken against another may be helpful in determining that an act was not accidental, but such a standard is an unnecessary departure from our previous holdings regarding intentional injury. See R.W. v. T.F., 528 N.W.2d at 873 (holding that "while not necessarily malicious," insured's decision to engage in unprotected sexual intercourse with claimant where the insured knew or should have known that he had herpes and that he could transmit the disease through such activity was intentional injury); Continental Western Ins. Co. v. Toal, 309 Minn. 169, 177-78, 244 N.W.2d 121, 126 (1976) (holding that although insureds did not specifically intend to injure anyone, they knew accomplices brought loaded guns and *617 they followed through with the robbery with the knowledge that someone might well be injured or killed).
The policy at issue does not provide coverage for liability resulting from the conduct presented here. I would affirm the court of appeals.
NOTES
[1] The intentional act exclusion at issue in R.W. is similar to the one in the American Family policy at issue here in that it excludes coverage for injury "caused intentionally" by the insured. R.W., 528 N.W.2d at 872.
[2] The dissent and American Family assert that the Hauenstein definition of accident that includes both unforeseen happening and unforeseen consequences cannot be used here because of the specific language in the American Family policy that speaks in terms of coverage for "injury caused by an occurrence." American Family asserts that defining accident (and therefore occurrence) as an unforeseen consequenceinjuryyields a grammatically unsound result in that the policy would provide coverage where "injury is caused by an unforeseen injury." American Family argues that injury can only be caused by an event, so the focus must be only on whether the event was intended. This argument fails because the proper analysis cannot be driven merely by the syntax chosen for defining an accident. Although expressed as an unforeseen happening or consequence in Hauenstein, without changing the meaning, the definition of accident could just as easily have been stated as "an unforeseen happening or a happening that results in unforeseen consequences." Such wording would avoid the inconsistency relied on by American Family and the dissent.
[1] The majority argues this dissent hinges on the grammatical structure of the policy language and rejection of our definition of accident in Hauenstein. This is plainly incorrect, as no amount of grammatical maneuvering will alter the intentional and injurious character of the actions taken by Walser and Shoemaker. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581569/ | 42 So.3d 1039 (2010)
Carol SMITHWICK and Glenn Smithwick, individually and as the Administrators of the Estate of the Minor Child, Carsen Smithwick, Plaintiffs-Appellants
v.
CITY OF FARMERVILLE, Community Trust Bank, CTB Financial Corporation and First United Bank, Defendants-Appellees.
No. 45,362-CA.
Court of Appeal of Louisiana, Second Circuit.
June 23, 2010.
Rehearing Denied August 5, 2010.
*1040 The Downs Law Firm, A.P.C., by Ross Downs, Jr., Ramsey L. Ogg, for Appellants, Carol, Glenn and Carsen Smithwick.
Hudson, Potts, & Bernstein, LLP, by Robert M. Baldwin, D. Brian Allen, Monroe, G. Adam Cossey, for Appellee, City of Farmerville.
Theus, Grisham, Davis, & Leigh, by James M. Edwards, Kay Stothart Rector, Monroe, for Appellees, Community Trust Bank, CTB Financial Corp., and First United Bank.
Before BROWN, STEWART, and GASKINS, JJ.
BROWN, Chief Judge.
This personal injury action arises out of a trip and fall accident. Plaintiffs are *1041 Carol and Glen Smithwick, Individually and as the Administrator of the Estate of the Minor Child Carsen Smithwick. Defendant is the City of Farmerville.[1] On January 24, 2005, plaintiff, Carol Smithwick, was near the intersection of two city streets waiting for her child's school bus to arrive. At the end of the sidewalk on West Jackson Street, she stepped off of the sidewalk onto the shoulder of North Lafayette Street and tripped on a shallow depression or hole and fell. Plaintiffs now appeal the trial court's judgment in favor of defendant, dismissing their suit for failure to prove either that the City had constructive or actual notice of a dangerous condition. For the reasons set forth below, we affirm the judgment of the trial court.
Factual and Procedural Background
In the middle of the afternoon of January 24, 2005, Mr. and Mrs. Smithwick and other parents were waiting for their children to come home on the bus which transported them to and from Cedar Creek School in Ruston, Louisiana. The location, the corner of West Jackson and North Lafayette Streets, had been used as a bus stop for Farmerville children attending Cedar Creek for at least nine years. According to the testimony, approximately 35 adults and children gathered at this location in the morning and afternoon of each school day from mid-August until late May.
Mrs. Smithwick was at the end of the sidewalk on West Jackson and moved off to her right onto the shoulder of North Lafayette. Grass/weeds had invaded the edge of the street in a small, patchy, irregular manner. It was described by one witness as "scrub grass." This ground cover had grown from inside the depression or hole and blended in with grass in the immediate area. Mrs. Smithwick apparently fell when she stepped into this area and suffered a left ankle injury. The radiology report taken that day showed no fractures or dislocations. Later, Mrs. Smithwick claimed among other medical problems "reflex sympathetic dystropy" ("RSD"). Thereafter, she claimed her right knee also developed RSD. At trial plaintiffs claimed $6.4 million in damages.
The matter was tried in December 2008, and January 2009. The parties stipulated that the City had custody of the area where Mrs. Smithwick fell. The court found that Mrs. Smithwick's fall was caused by her stepping into the depression or hole on the right-of-way within the City's custody and that the hole presented an unreasonable risk of harm. The court, however, found that plaintiffs failed to establish either actual or constructive notice on the part of the City. Based upon their failure to prove one of the necessary elements of their cause of action, the trial court dismissed plaintiffs' action against the City. It is from this judgment that plaintiffs have appealed.
Discussion
Louisiana Civil Code article 2317 imposes responsibility for damage caused by, inter alia, things we have in our custody with a defect that created an unreasonable risk of harm and was a cause-in-fact of harm. It also provides that the custodian possess actual or constructive notice of the defect. Revised Statute 9:2800(C) provides in pertinent part that:
No person shall have a cause of action based solely upon liability imposed under Civil Code Article 2317 against a public entity for damages caused by the *1042 condition of things within its care and custody unless the public entity had actual or constructive notice of the particular vice or defect which caused the damage prior to the occurrence, and the public entity has had a reasonable opportunity to remedy the defect and has failed to do so.
Before a municipality can be held liable for injuries resulting from a defect in the condition of a public way, the municipality must have had actual or constructive notice of the particular defect that gave rise to the injury. Jones v. Hawkins, 98-1259 (La.03/19/99), 731 So.2d 216; Breitling v. City of Shreveport, 44,112 (La. App.2d Cir.05/13/09), 12 So.3d 457; Johnson v. City of Bastrop, 41,240 (La.App.2d Cir.08/01/06), 936 So.2d 292. Failure to meet this statutory element will defeat a negligence claim against a public entity. Breitling, supra; Williams v. City of Mansfield, 42,319 (La.App.2d Cir.08/15/07), 962 So.2d 1187.
Actual notice is knowledge of dangerous defects or conditions by a corporate officer or employee of the public entity having a duty either to keep the property involved in good repair or to report defects and dangerous conditions to the proper authorities. Summerall v. Ouachita Parish School Board, 27,643 (La.App.2d Cir.12/08/95), 665 So.2d 734; Boddie v. State of Louisiana, 27,313 (La.App.2d Cir.09/27/95), 661 So.2d 617.
Constructive notice is defined by La. R.S. 9:2800 as the existence of facts which imply actual knowledge. Ordinarily, to establish constructive notice, plaintiffs must prove that the defect causing the injury existed over a sufficient length of time to establish that reasonable diligence would had led to its discovery and repair. Breitling, supra; Johnson, supra; Whitaker v. City of Bossier City, 35,972 (La. App.2d Cir.04/05/02), 813 So.2d 1269.
The trial court's findings of fact, including whether a public body had actual or constructive notice of a hazardous condition, are subject to the manifest error standard of review. Williams, supra. The appellate court must determine whether the trial court's conclusions are reasonable based upon the record as a whole. Graves v. Page, 96-2201 (La.11/07/97), 703 So.2d 566; Breitling, supra. Where two permissible views of the evidence exist, the factfinder's choice between them cannot be manifestly erroneous or clearly wrong. Stobart v. State through DOTD, 617 So.2d 880 (La.1993); Williams, supra.
What is obvious in the present case is that throughout the school year some 35 people, including plaintiffs, twice a day gathered around the defective area, and no one ever noticed a depression or hole, and no one had ever reported a stumble or fall. This was a small, patchy, irregular area that would be quickly cut with one or two sweeps of a Weedeater leaving the grass at a height of one inch. Plaintiffs' expert speculated that it was an old posthole for a stop sign that was moved to the other side of the sidewalk and that the fill-dirt settled leaving the depression. This was not confirmed by testimony of the City's employees. No one had knowledge as to how or when the washout/depression/hole occurred. The trial court found that plaintiffs failed to establish that the City had actual or constructive notice of such a defect in its right-of-way.
Plaintiffs assert that the trial court misconstrued or failed to properly consider the deposition testimony of city worker Charles Young in concluding that the City had no "actual" notice of the condition. Mr. Young's trial testimony contradicted and explained his deposition testimony. The following is excerpted from the trial court's written reasons for judgment:
Plaintiffs argue that the City of Farmerville had actual knowledge of the depression *1043 through its employee Charles Young. At a deposition taken prior to trial, Young testified that he had observed the depression when he trimmed the area with a Weed-eater prior to the accident. The depression was depicted in a photograph annexed to Young's deposition. However, in his deposition, Young repeatedly stated that the depression that he recalled was near a water line with a water faucet. Subsequent evidence demonstrates that the faucet referred to by Young was not located near this particular depression but north of it. Young was obviously referring to another depression made by drainage from that faucet or water line, not the one which is the subject of this litigation. At trial, the faucet was still located north of the depression that is involved in this case. Given the proximity of the depression to the roadway surface (which appears to be 2 to 4 feet), it would be highly unlikely that a faucet would have been located in that location. Clearly, Young was referring to a different depression or hole [in his deposition].
Not only did the trial court consider the testimony of Charles Young, the court meticulously compared Young's deposition testimony with his trial testimony to determine the location of the depression he noticed. The court found that the hole referred to by Young in his deposition was in fact in a different location than where Mrs. Smithwick fell, and the record supports this conclusion. The trial court's finding of no actual notice on the part of the City is also supported by the testimony of city employees Charles Boyd and Kenneth Bilberry regarding the City's Weed-eating activities on the right-of-way and lack of any prior complaints about holes or depressions in the right-of-way.
Plaintiffs also contend that the trial court erred in finding that the City did not have constructive notice of the hole in the right-of-way.
In its written reasons for judgment the trial court stated:
Plaintiffs argue that because the city maintenance personnel trimmed and/or mowed in the area two times per month during the growing season (presumably from sometime in May to sometime in September), those employees must have seen and observed the depression or hole prior to the accident. The Court disagrees.
No one knows how the hole was formed or how long it had been there. Apparently, no one noticed the hole prior to plaintiff's fall. It would be speculative to conclude the hole existed when the area was last mowed or trimmed by city employees, presumably in September 2004. In the absence of evidence establishing when the hole came into existence or that it existed in September 2004 when the area was last mowed, the Court is unable to conclude that the City had constructive knowledge of its presence. Approximately 30 persons, including parents and children, assembled in the general area five days per week from mid-August to late May. Much of this time is during the non-growing season when grass and vegetation would not obstruct a view of the depression or hole in question. None of those persons, including plaintiffs and Judge McCallum (who was at the stop waiting for his son and whose law office was a couple of doors down from the bus stop), were aware of the hole's existence. If the hole or depression had been in existence for a significant period of time, it is unlikely that no other person would have had difficulty at the location or noticed its presence.
In the instant case, the defective condition, a shallow depression, was located in *1044 an unimproved grassy area off to the side of the city sidewalk. For a number of years, the City maintained this area through Weed-eating, and parents and children walked over and stood in the right-of-way, and there was no evidence that anyone ever noticed the depression. Quite simply, these facts do not demonstrate that the condition had ever been noticed or should have been noticed by City employees. This shallow depression was not unlike what would be found throughout the city and even in homeowners' lawns. Whether this defect was unreasonably dangerous, however, is not before this court. The trial court was not clearly wrong in finding that plaintiffs put forth no evidence which would allow for an inference of actual knowledge on the part of the City. See Williams, supra; Whitaker, supra; Ambrose v. City of New Iberia, 08-1197 (La.App. 3d Cir.04/01/09), 11 So.3d 34. We cannot say that the trial court erred in finding that plaintiffs failed to prove actual or constructive notice. Plaintiffs, having failed to prove an essential element of their cause of action, are not entitled to recovery from the City.
Conclusion
For the reasons set forth above, the judgment of the trial court is AFFIRMED. Costs are assessed to plaintiffs-appellants, Carol Smithwick and Glen Smithwick, Individually and as the Administrator of the Estate of the Minor Child Carsen Smithwick.
AFFIRMED.
APPLICATION FOR REHEARING
Before BROWN, STEWART, GASKINS, CARAWAY, and DREW, JJ.
Rehearing denied.
NOTES
[1] Plaintiffs also named as defendants Community Trust Bank, CTB Financial Corporation, and First United Bank; however, they were dismissed from this action via summary judgment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581571/ | 628 N.W.2d 272 (2001)
262 Neb. 77
In re Search Warrant for 3628 V STREET, Omaha, Douglas County, Nebraska.
State of Nebraska, Appellant,
v.
Jeffrey Rybin, Appellee.
No. S-00-007.
Supreme Court of Nebraska.
June 29, 2001.
*274 James S. Jansen, Douglas County Attorney, and Robert Francis Cryne, Omaha, for appellant.
Michael J. Tasset, Oakland, of Johnson and Mock, for appellee.
HENDRY, C.J., and WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.
HENDRY, Chief Justice.
INTRODUCTION
Jeffrey Rybin filed a motion to unseal an affidavit used in support of a search warrant issued for his home, asserting a right of public access under the First Amendment to the U.S. Constitution. The district court ordered that the affidavit be unsealed, and the State appealed.
FACTUAL BACKGROUND
On August 17, 1998, Special Agent Farrell Fisher, of the U.S. Drug Enforcement Administration (DEA), applied to the Douglas County Court for a warrant authorizing the search of a residence located at 3628 V Street in Omaha, Nebraska. This residence was owned and occupied by Rybin. In support of the application, Fisher submitted an affidavit containing information provided by a confidential informant.
The search warrant was issued by the Douglas County Court on August 17, 1998, and executed on the same day. However, no evidence of criminal activity was discovered, and accordingly, no criminal proceedings were instituted against Rybin.
*275 On August 24, 1998, Fisher's affidavit was sealed by order of the county court. On the same day, the search warrant, affidavit, and return were filed with the clerk of the district court pursuant to Neb.Rev. Stat. § 29-816 (Reissue 1995). Section 29-816 states in pertinent part:
The judge or magistrate who has issued the search warrant shall attach to the warrant a copy of the return, inventory, and all other papers in connection therewith and shall file them with the clerk of the district court.... The clerk of the district court shall file and index such warrant, together with the return thereon, the inventory, and other papers in connection therewith as a separate criminal proceeding. No fee shall be charged or collected for such service.
On September 15, 1998, Rybin filed a "Motion to Unseal Affidavit" in the district court for Douglas County. Rybin asserted in his motion that sealing the affidavit violated his "qualified First Amendment right of access." A hearing on this motion was held on September 28. At this hearing, Rybin asserted that under In re Search Warrant for Secretarial Area-Gunn, 855 F.2d 569 (8th Cir.1988), he possessed a qualified First Amendment right of public access to the affidavit. Rybin offered no other grounds for his request to unseal the affidavit.
At the hearing on the motion, the only evidence offered by Rybin was the sealed search warrant, affidavit, and return. The State then called Fisher to testify. Fisher testified that Rybin telephoned him the day after the search was conducted, wanting to know who provided the information which led to the search. Fisher refused to give Rybin the confidential informant's identity. Fisher further testified that Rybin submitted a claim to the DEA for damage to his property which had occurred during the search. According to Fisher, the claim had been approved by the DEA and a check compensating Rybin for his property damage was forthcoming.
Regarding the identity of the confidential informant, Fisher testified that the information contained in the affidavit would assist Rybin in ascertaining the identity of the informant, even though the name of the informant was not stated in the affidavit. Fisher further testified that the affidavit should not be unsealed because "the identity would bemost likely be revealed of this confidential source, and it could be made public andand his effectivenesshis or her effectiveness would not be useful toto us." Fisher further testified that the confidential informant was currently involved in two ongoing DEA investigations.
On April 3, 2000, the district court ordered the affidavit unsealed "except for the identity of a confidential informant." The State appealed, contending that partially unsealing the affidavit would nevertheless allow Rybin to determine the identity of the informant. We moved this case to our docket pursuant to our authority to regulate the caseloads of Nebraska appellate courts. Neb.Rev.Stat. § 24-1106(3) (Reissue 1995).
ASSIGNMENTS OF ERROR
The State asserts, restated and renumbered, that the district court erred in granting Rybin's motion because (1) the State's interest in protecting the informant's identity defeats any First Amendment qualified right of public access, (2) Rybin failed to demonstrate a material need for the information contained in the affidavit, and (3) the trial court abused its discretion in unsealing the affidavit.
STANDARD OF REVIEW
On a question of law, an appellate court is obligated to reach a conclusion *276 independent of the determination reached by the court below. State v. Bottolfson, 259 Neb. 470, 610 N.W.2d 378 (2000); State v. Spotts, 257 Neb. 44, 595 N.W.2d 259 (1999).
ANALYSIS
The State argues that the trial court erred in unsealing any portion of the affidavit because the State's interest in protecting the identity of the confidential informant outweighs Rybin's asserted qualified First Amendment right of public access. This issue presents a question of law regarding which we are obligated to reach a conclusion independent of the trial court. State v. Bottolfson, supra.
Rybin, in addition to his assertion of a qualified First Amendment right, also contends in his brief that the district court's decision should be affirmed based on a common-law right of judicial access, or the Fourth Amendment. However, because these issues were not raised by Rybin before the trial court, they will not be addressed on appeal. See State v. Moore, 256 Neb. 553, 591 N.W.2d 86 (1999).
The First Amendment right of public access traditionally gives the press and the public the right to attend criminal trials, absent an overriding interest of higher value which necessitates closing the proceedings. See Globe Newspaper Co. v. Superior Court, 457 U.S. 596, 102 S.Ct. 2613, 73 L.Ed.2d 248 (1982). However, neither this court nor the U.S. Supreme Court has recognized the existence of a First Amendment right of public access to affidavits in support of search warrants. In Press-Enterprise Co. v. Superior Court, 478 U.S. 1, 106 S.Ct. 2735, 92 L.Ed.2d 1 (1986), the Supreme Court articulated the general principles to consider in determining when a qualified First Amendment right of public access exists. In Press-Enterprise Co., the plaintiff's motion to unseal the transcript of a preliminary hearing in a criminal prosecution was denied. On appeal, the Supreme Court determined that a qualified First Amendment right of public access existed with regard to the transcript and granted the plaintiff access to the document. Id.
In Press-Enterprise Co., the Court identified "two complementary considerations" for courts to use when determining whether a First Amendment right of public access exists. 478 U.S. at 8, 106 S.Ct. 2735. The first is "considerations of experience," 478 U.S. at 9, 106 S.Ct. 2735, namely, whether there is a "`"tradition of accessibility"'" in that "the place and process have historically been open to the press and general public," 478 U.S. at 8, 106 S.Ct. 2735. The second is "considerations of ... logic," 478 U.S. at 9, 106 S.Ct. 2735, as to "whether public access plays a significant positive role in the functioning of the particular process in question," 478 U.S. at 8, 106 S.Ct. 2735.
Numerous jurisdictions have considered whether applications for search warrants have historically been open to the press and public. See, Baltimore Sun Co. v. Goetz, 886 F.2d 60 (4th Cir.1989); Times Mirror Co. v. U.S., 873 F.2d 1210 (9th Cir.1989); In re Search Warrant for Secretarial Area-Gunn, 855 F.2d 569 (8th Cir.1988); U.S. v. Certain Real Property Located in Romulus, 977 F.Supp. 833 (E.D.Mich.1997); In re Macon Telegraph Publishing Co., 900 F.Supp. 489 (M.D.Ga. 1995); Matter of Flower Aviation of Kansas, Inc., 789 F.Supp. 366 (D.Kan.1992); Matter of 2 Sealed Search Warrants, 710 A.2d 202 (Del.Super.1997); Newspapers of New England, Inc. v. Clerk-Magistrate of the Ware Division of the District Court, 403 Mass. 628, 531 N.E.2d 1261 (1988); State v. Archuleta, 857 P.2d 234 (Utah 1993); Seattle Times Co. v. Eberharter, *277 105 Wash.2d 144, 713 P.2d 710 (1986); State v. Cummings, 199 Wis.2d 721, 546 N.W.2d 406 (1996).
Aside from the Eighth Circuit in In re Search Warrant for Secretarial Area-Gunn, supra, federal courts which have considered the issue have concluded that applications for search warrants have not historically been open to the press and public. See, Baltimore Sun Co. v. Goetz, supra; Times Mirror Co. v. U.S., supra; U.S. v. Certain Real Property Located in Romulus, supra; In re Macon Telegraph Publishing Co., supra; Matter of Flower Aviation of Kansas, Inc., supra. The same is true of the majority of state courts which have considered this issue. See, Matter of 2 Sealed Search Warrants, supra; Newspapers of New England, Inc. v. Clerk-Magistrate of the Ware Division of the District Court, supra; Seattle Times Co. v. Eberharter, supra; State v. Cummings, supra. Only the State of Utah, relying on the reasoning of the Eighth Circuit in In re Search Warrant for Secretarial Area-Gunn, supra, has found a tradition of public access regarding warrant applications. State v. Archuleta, supra.
In In re Search Warrant for Secretarial Area-Gunn, supra, the Eighth Circuit reasoned that because warrants and supporting affidavits are traditionally filed with the courts as public records, such proceedings are generally accessible to the press and the public. Rybin relies upon In re Search Warrant for Secretarial Area-Gunn to support his claim of public access. However, the Eighth Circuit's decision is not binding authority upon this court. See Lockhart v. Fretwell, 506 U.S. 364, 113 S.Ct. 838, 122 L.Ed.2d 180 (1993) (Thomas, J., concurring) (state courts bound by Supreme Court's interpretation of federal law, but not bound by circuit court's interpretation). See, also, Bromley v. Crisp, 561 F.2d 1351 (10th Cir.1977) (state courts may express differing views on federal questions until guided by binding decision of Supreme Court).
The test adopted by the U.S. Supreme Court is whether the "place and process" of the criminal proceeding has traditionally been open to the press and public. Press-Enterprise Co. v. Superior Court, 478 U.S. 1, 8, 106 S.Ct. 2735, 92 L.Ed.2d 1 (1986). Applications for search warrants, which compose the process from which the affidavits arise, are conducted ex parte, typically without the press and public present. See, e.g., Baltimore Sun Co. v. Goetz, supra; Times Mirror Co. v. U.S., supra. Compare, also, Franks v. Delaware, 438 U.S. 154, 169, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978) (proceeding for issuing search warrant is "necessarily ex parte, since the subject of the search cannot be tipped off to the application for a warrant lest he destroy or remove evidence"); United States v. United States District Court, 407 U.S. 297, 321, 92 S.Ct. 2125, 32 L.Ed.2d 752 (1972) ("a warrant application involves no public or adversary proceedings: it is an ex parte request before a magistrate or judge"). We agree with the majority of courts which have concluded that search warrant applications have not historically been open to the press and public. As such, we determine that "considerations of experience" do not support a First Amendment right of access in this case. See Press-Enterprise Co. v. Superior Court, 478 U.S. at 9, 106 S.Ct. 2735.
We next turn to "considerations of... logic," 478 U.S. at 9, 106 S.Ct. 2735, to determine "whether public access plays a significant positive role in the functioning of the particular process in question," 478 U.S. at 8, 106 S.Ct. 2735. As noted by the Supreme Court, "there are some kinds of government operations that would be totally frustrated if conducted openly." 478 U.S. at 9, 106 S.Ct. 2735. Search warrants, *278 by their very nature, rely on the ex parte application proceeding in order to be effective in seizing evidence of criminal activity. The ultimate purpose of an application for a search warrant is to enable the government to lawfully seize evidence of criminal activity. This purpose would be totally frustrated if the public had access to such proceedings. Once the secrecy of the search affidavit proceeding is eliminated, the element of surprise necessary to effectuate the warrant has been lost. See, e.g., Franks v. Delaware, supra.
For the foregoing reasons, we determine that public access to search warrant applications would not play "a significant positive role" in the functioning of the warrant application process. See, also, Times Mirror Co. v. U.S., 873 F.2d 1210 (9th Cir.1989); U.S. v. Certain Real Property Located in Romulus, 977 F.Supp. 833 (E.D.Mich.1997); In re Macon Telegraph Publishing Co., 900 F.Supp. 489 (M.D.Ga. 1995); Matter of Flower Aviation of Kansas, Inc., 789 F.Supp. 366 (D.Kan.1992); Matter of 2 Sealed Search Warrants, 710 A.2d 202 (Del.Super.1997); Newspapers of New England, Inc. v. Clerk-Magistrate of the Ware Division of the District Court, 403 Mass. 628, 531 N.E.2d 1261 (1988); Seattle Times Co. v. Eberharter, 105 Wash.2d 144, 713 P.2d 710 (1986); State v. Cummings, 199 Wis.2d 721, 546 N.W.2d 406 (1996).
Accordingly, we determine that no qualified First Amendment right of public access attaches to an affidavit in support of a search warrant. Rybin possesses no right of access under the First Amendment which would allow the district court to unseal any portion of the affidavit.
Having so determined, it is not necessary to reach the State's other assignments of error.
CONCLUSION
The district court's decision ordering the affidavit to be unsealed is reversed, and the cause is remanded with directions to dismiss.
REVERSED AND REMANDED WITH DIRECTIONS TO DISMISS. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581595/ | 42 So.3d 238 (2010)
SIMONS
v.
STATE.
No. 1D09-5103.
District Court of Appeal of Florida, First District.
August 11, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582370/ | 31 So. 3d 1204 (2010)
DIALYSIS SOLUTION, LLC
v.
MISSISSIPPI STATE DEPARTMENT OF HEALTH, Dr. Mary Currier, in her capacity as the Executive Director of the Department of Health; State of Mississippi and RCG-Montgomery County, LLC.
No. 2008-CA-02073-SCT.
Supreme Court of Mississippi.
February 18, 2010.
Rehearing Denied April 15, 2010.
*1205 Bryant Wandrick Clark, Robert George Clark, III, attorneys for appellant.
*1206 Bea McCrosky Tolsdorf, Barry K. Cockrell, attorneys for appellees.
Before GRAVES, P.J., DICKINSON and CHANDLER, JJ.
GRAVES, Presiding Justice, for the Court.
¶ 1. This case requires interpretation of Section 41-7-195 of the Mississippi Health Care Certificate of Need Law of 1979. This statutory section addresses the validity and duration of a Certificate of Need (CON), which is a certificate that healthcare providers must obtain from the Mississippi State Department of Health (MSDH) prior to constructing certain healthcare facilities or offering designated health services. The two issues before this Court are: 1) Whether, pursuant to Section 41-7-195, the MSDH has the authority to grant an extension of a CON after the date of expiration specified in the CON; and 2) whether, pursuant to Section 41-7-195, the MSDH has the authority to grant multiple extensions of a CON. The plaintiffDialysis Solution, a company desiring to develop a kidney-disease treatment facility in Montgomery County, Mississippi argues that the MSDH has never had the authority to take either of these actions. The defendantsthe MSDH, the State Health Officer (the late Dr. Ed Thompson[1]), the State of Mississippi, and RCG-Montgomery, LLC (RCG), the developer of a kidney-disease treatment facility in Montgomery County and holder of the CON at issueargue that the MSDH had the authority to take both these actions. The trial court ruled in favor of the defendants on both issues. Finding that the MSDH did not have the authority to grant an extension of RCG's CON after the CON's expiration date, and finding this issue dispositive, we reverse and render.
FACTS AND PROCEDURAL HISTORY
¶ 2. This case focuses on the validity of a Certificate of Need (CON) that was issued to defendant RCG-Montgomery County, LLC (RCG), to develop a kidney-disease treatment facility in Montgomery County. To assist the trial court in making its final judgment on the issues presented, all parties agreed to stipulate to the facts of the case. Unless otherwise noted, all of the following facts were taken from the parties' Joint Stipulation of Facts.
¶ 3. The Mississippi Health Care Certificate of Need Law of 1979 (The Health Care CON Law) (Miss.Code Ann. §§ 41-7-173 through 41-7-209 (Rev.2009)) designates the Mississippi State Department of Health (MSDH) as the sole agency to administer and supervise all state health planning responsibilities. Miss.Code Ann. § 41-7-175 (Rev.2009). The purposes of Mississippi's health planning and regulatory activities are to prevent unnecessary duplication of health resources, provide cost containment, improve the health of Mississippi residents, and increase the accessibility, acceptability, continuity, and quality of health services. Mississippi Department of Health, State Health Plan for Fiscal Year 2005: Introduction, available at http://msdh.ms.gov/ msdhsite/_static/resources/1083.pdf (last accessed Feb. 11, 2010).
¶ 4. The Health Care CON Law authorized the MSDH to develop and implement a statewide health CON program. Miss. Code Ann. § 41-7-187 (Rev.2009). A CON must be obtained from the MSDH *1207 before a person may undertake any of the activities described in Section 41-7-191(1), which include the establishment of End-Stage Renal Disease (ESRD) facilities. Miss.Code Ann. § 41-7-191(1) (Rev.2009). No final arrangement or commitment for financing such activity may be obtained by any person unless the MSDH has issued a CON for such arrangement or commitment. Miss.Code Ann. § 41-7-193(1) (Rev.2009). No CON shall be issued unless the project proposed in the application for such CON has been reviewed for consistency with the specifications and criteria established by the MSDH and substantially complies with the projection of need as reported in the Mississippi State Health Plan which is in effect at the time the application is submitted to the MSDH. Miss.Code Ann. § 41-7-193(1).
¶ 5. The Mississippi State Board of Health authorized the MSDH to issue CONs for the construction or expansion of ESRD facilities having a need in several counties, including Montgomery County. On December 16, 2004, after having reviewed a CON application from RCG, the MSDH issued a CON to RCG for a six-station ESRD facility in the City of Winona in Montgomery County.
¶ 6. While the CON for the RCG ESRD facility was issued in December 2004, for two significant reasons, RCG did not commence development and construction of the project until approximately September 2007.[2] First, approximately eight months after the CON was issued, Hurricane Katrina devastated the Mississippi Gulf Coast. The hurricane had a significant impact on ESRD facilities operated by RCG's parent company, Renal Care Group, Inc., and also on facilities operated by the company that was involved in negotiations to acquire RCG's parent company, Fresenius Medical Care Holdings, Inc. (Fresenius). As a result, those two companies devoted all of their time and resources to recovery efforts on the Gulf Coast, which were necessary to insure that ESRD patients in that area had access to dialysis treatment. Second, in 2005, Renal Care Group, Inc. (RCG's parent company), negotiated and executed an agreement to be acquired by Fresenius. Renal Care Group, Inc., announced the definitive agreement on May 4, 2005, but RCG could not move forward with the development of the ESRD facility in Montgomery County until federal regulatory approvals were secured regarding the transaction. More specifically, RCG had to wait until the *1208 Federal Trade Commission could analyze the operations of Renal Care Group, Inc., and Fresenius in Mississippi to determine whether either or both companies would have to sell assets and/or facilities to address antitrust concerns. Until this federal review was complete, there was no way to know whether the RCG Montgomery County dialysis facility project could be retained and developed. After the necessary federal regulatory approvals were obtained on July 5, 2006, and following the recovery from Hurricane Katrina, RCG turned its attention back to the development of the dialysis facility in Montgomery County.
¶ 7. On December 29, 2006 (about eight or nine months before RCG began construction on its dialysis facility), MSDH received a CON application for the establishment of a twelve-station ESRD facility in Montgomery County from Dialysis Solution.[3]
¶ 8. On January 8, 2007 (ten days after the MSDH received a CON application from Dialysis Solution), RCG filed its first request for a six-month extension of the CON that it had been issued on December 16, 2004. On January 18, 2007, the State Health Officer granted the requested six-month extension. In August 2007, RCG requested a second six-month extension. On August 30, 2007, the State Health Officer granted RCG this second extension, making it the second official six-month extension granted of four official six-month extensions the State Health Officer ultimately granted before the project was completed in August 2008.
¶ 9. In a letter dated September 27, 2007, Dialysis Solution requested a public hearing for revocation of RCG's CON, arguing that, pursuant to Section 41-7-195, the MSDH is forbidden from extending a CON after the CON has lapsed, and that it is forbidden from extending a CON for any amount of time exceeding six months (i.e., forbidden from allowing a CON to be outstanding for more than the initial twelve-month duration of the CON plus one six-month extension). In the alternative, Dialysis Solution argued, the MSDH should revoke RCG's CON for RCG's failure to commence construction on the facility more than two-and-a-half years after it had been issued the CON. In a letter dated October 12, 2007, the MSDH denied Dialysis Solution's request for a public hearing on the revocation of RCG's CON.
¶ 10. On October 12, 2007, at Dialysis Solution's request, the Mississippi Attorney General's Office issued an opinion clarifying *1209 its understanding of Section 41-7-195 as it relates to expirations of CONs. The Attorney General's Office explained that it is its opinion that, pursuant to Section 41-7-195, after the date of expiration of a CON, the CON is automatically void by operation of law and does not require any action on the part of the MSDH to finalize its voided status. The Attorney General's Office elaborated:
The statute expressly provides that a CON is valid only for the time period stated therein. . . . [O]nce the time period stated in the CON has lapsed, the CON is void and no extensions can be granted. At that point, the applicant would be required to reapply for a CON. . . . [A]fter the expiration of the time period stated in the CON, the Department does not have the authority to grant an extension of the CON. Any extensions granted pursuant to Section 41-7-195(3) must be granted prior to the expiration.
Op. Att'y Gen.XXXX-XXXXX (Miss. Oct. 12, 2007).
¶ 11. On October 23, 2007, Dialysis Solution filed a Complaint for Declaratory Judgment and Injunctive Relief in the Chancery Court for the First Judicial District of Hinds County, Mississippi. In Dialysis Solution's Complaint, it argued that, pursuant to Section 41-7-195, the MSDH is forbidden from granting more than one six-month extension of a CON (i.e., a CON cannot be valid for more than a total of eighteen months), thus the CON issued to RCG on December 16, 2004, is invalid by operation of law. On February 20, 2008, Dialysis Solution filed a Motion for Temporary Restraining Order and/or Preliminary Injunction to enjoin the MSDH from granting any additional extensions of RCG's CON, to enjoin the MSDH from issuing a license to RCG for an ESRD facility in Montgomery County, and to prohibit RCG from continuing any construction on the ESRD facility in Montgomery County until the trial court ruled on the matter. On March 3, 2008, Dialysis Solution filed an Amended Complaint, adding the argument that, pursuant to Section 41-7-195, once the time period stated in the CON has lapsed, the CON is void, and the MSDH does not have the legal authority to extend it.
¶ 12. On October 26, 2007three days after Dialysis Solution filed its initial Complaint the MSDH issued an official notice that it had received the October 12, 2007, Attorney General's Opinion regarding interpretation of Section 41-7-195 as it relates to CON extensions. The notice explained that, in response to the Attorney General's Opinion, the MSDH was adopting a Temporary Rule, effective October 29, 2007, to develop a clear and consistent process for the review and extension of outstanding CONs. The MSDH stated that the reasons for the Temporary Rule were as follows:
The Department of Health finds that Certificates of Need ("CONs") have been issued to serve unmet healthcare needs of the state and that compliance with the Attorney Generals's Opinion of October 12, 2007, may prevent the completion of outstanding CONs that were issued to address such needs. Changes in the CON Rules regarding extensions of valid CONs are necessary to comply with the Attorney General's Opinion, to modify requirements for six-month extensions, to clarify the status of incomplete CONs, and to provide transition of incomplete CONs.
¶ 13. The Temporary Rule provided that, in order to continue authority for a *1210 CON following the initial twelve-month issuance period, the CON holder is required to document substantial progress toward completion of the certificated facility and be granted a six-month extension. The CON holder is required to file a request for a six-month extension at least thirty days prior to the expiration of the original or any extended period of the CON. The Temporary Rule further provided that "[i]f a CON holder fails to receive Department approval for an extension prior to the CON's expiration date, the CON shall be automatically void, and shall not require any action on the part of the Department to withdraw, revoke or rescind the certificate." However, the Temporary Rule made an exception for those who at the current time held expired or very-soon-to-expire CONs. It stated:
For currently approved projects where the original CON has expired, or an extension of the CON has expired, or where the CON will expire in 30 days from the effective date of this rule, the CON holder has 15 business days from the effective date of this rule (or by November 19, 2007) to submit a progress report documenting project completion, or submit a request for a six-month extension. . . .
This Temporary Rule became a Permanent Rule on February 23, 2008. Hereinafter, the Temporary and Permanent Rule will be referred to as "the new Rules."
¶ 14. On November 16, 2007, pursuant to the new Rules, RCG filed a request for a six-month extension of its CON, and on December 18, 2007, RCG submitted to the MSDH a progress report and documentation of commencement of construction of the project. On January 14, 2008, the MSDH granted RCG's request for a six-month extension, making this the third official six-month extension granted to RCG. The MSDH explained that this latest extension period would terminate on June 16, 2008.
¶ 15. On March 27, 2008, the trial court issued an Order denying Dialysis Solution's Motion for Temporary Restraining and/or Preliminary Injunction.
¶ 16. On May 16, 2008, RCG requested another six-month extension, and was granted this extension on May 20, 2008, making this the fourth and final six-month extension granted to RCG.
¶ 17. On August 1, 2008, construction of the RCG dialysis facility was completed, and the City of Winona issued RCG a Certificate of Occupancy for it. On August 25, 2008, the RCG facility commenced operations with the treatment of a dialysis patient.
¶ 18. On December 8, 2008, the trial court issued a Final Judgment in favor of the defendants, finding "no legal basis to determine that the granting of the CON extension by MSDH to RCG was arbitrary or capricious or otherwise illegal or improper." Dialysis Solution then timely filed its appeal to this Court.
¶ 19. Because we find the issue of whether the MSDH had the authority to grant an extension of RCG's CON after the CON's expiration date to be dispositive, we decline to address the issue of whether the MSDH had the authority to grant multiple extensions of RCG's CON.
DISCUSSION
¶ 20. This appeal requires review of the MSDH's interpretation of and decision-making under Mississippi Code Section 41-7-195, the section of the Health Care CON Law that addresses the validity and *1211 duration of CONs. Miss.Code Ann. § 41-7-195 (Rev.2009). The relevant portion of Section 41-7-195 states:
(1) . . . A certificate of need shall be valid for the period of time specified therein.
(2) A certificate of need shall be issued for a period of twelve (12) months, or such lesser period as specified by the State Department of Health.
(3) The State Department of Health may define by regulation, not to exceed six (6) months, the time for which a certificate of need may be extended.
Miss.Code Ann. § 41-7-195(1)-(3) (Rev. 2009).
¶ 21. The standard of review this Court applies to an administrative agency's decision is well established. When reviewing the decision of an agency, this Court is limited as to the scope and depth of its inquiry. It will reverse the decision of an agency only if the decision was: 1) not supported by substantial evidence; 2) arbitrary or capricious; 3) beyond the power of the agency to make; or 4) violated a statutory or constitutional right of the complaining party. Miss. Methodist Hosp. and Rehab. Ctr. v. Miss. Div. of Medicaid, 21 So. 3d 600, 606 (Miss. 2009). See also Green v. Cleary Water, Sewer, & Fire Dist., 17 So. 3d 559, 566 (Miss.2009). There is a rebuttable presumption in favor of the action of the agency, and the burden of proof is on the party challenging the action. Green, 17 So.3d at 566.
¶ 22. An agency's interpretation of a statute governing its operation is a matter of law and is thus reviewed de novo, but with great deference to the agency's interpretation. Miss. Methodist Hosp. and Rehab. Ctr., 21 So.3d at 606. Deference is afforded the agency because "the everyday experience of the administrative agency gives it familiarity with the particularities and nuances of the problems committed to its care which no court can hope to replicate." Id. (quoting Gill v. Miss. Dep't of Wildlife Conservation, 574 So. 2d 586, 593 (Miss.1990)). If an agency's interpretation of a statute is contrary to the unambiguous language or best reading of a statute, however, this Court will not afford it any deference. Id. This Court will not uphold an agency's interpretation if "it is so plainly erroneous or so inconsistent with either the underlying regulation or statute as to be arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law." Id. (quoting Buelow v. Glidewell, 757 So. 2d 216, 219 (Miss. 2000)).
¶ 23. Dialysis Solution argues that the MSDH does not have the authority to grant an extension of a CON after the date of expiration specified in the CON. Dialysis Solution contends that, once the stated duration of the CON has lapsed, the CON is void, and the MSDH must reissue the CON in accordance with CON statutory provisions. Therefore, Dialysis Solution reasons, since the expiration date of RCG's CON was December 16, 2005, RCG's CON became void on that date, and the MSDH did not have the authority to grant any of the six-month extensions that it granted to RCG after that date.
¶ 24. The defendants argue that the MSDH had the authority to grant RCG all of the extensions it was granted, pursuant to the regulations the MSDH adopted in accordance with its rule-making authority (i.e., pursuant to "the new Rules"). The defendants refuse to admit that RCG's CON expired a year after it was granted, *1212 but they fail to offer any explanation as to how or why the CON did not expire at that time (i.e., on December 16, 2005). The defendants resort to not directly addressing either this question or the question of how the MSDH had the authority to extend RCG's CON long after the CON's expiration date. Instead, the defendants repeatedly point to the MSDH's authority to promulgate rules and regulations regarding the CON program, the fact that the MSDH promulgated the new Rules to address the validity, duration, and extensions of CONs, and the fact that RCG has complied with the new Rules. The defendants argue that "[t]here is no legal basis whatsoever for Dialysis Solution's claim that the MSDH did not have the authority to extend a CON when it has purportedly `expired.'" This contention, the defendants assert, "is based solely on an Attorney General's Opinion, which can neither validate nor invalidate a past action of a State officer or agency, and operates prospectively only." "The Attorney General [sic] Opinion itself is not some type of binding, retroactive legal finding and precedent that invalidates the CON issued to RCG," the defendants explain. The defendants also argue that, because its CON has been fully implemented and its dialysis facility is currently serving numerous patients, it would be a grave injustice to these patients, their families, and the public to impede the operation of the facility.
¶ 25. The trial court agreed with the defendants' arguments and found that the MSDH in no way had overstepped its authority by granting all the CON extensions to RCG that it did.
¶ 26. Specifically, the question before this Court is whether the MSDH exceeded its power and violated Section 41-7-195(1)-(2) of the Health Care CON Law when, on January 18, 2007, it granted RCG's January 8, 2007, request for a six-month extension, this request having been made one year and twenty-three days after the date of expiration specified on RCG's CON.[4] As noted above, Section 41-7-195(1)-(2) states that "[a] certificate of need shall be valid for the time period specified therein" and "[a] certificate of need shall be issued for a period of twelve (12) months, or such other lesser period as specified." Miss.Code Ann. § 41-7-195(1)-(2) (Rev.2009). Also as noted above, this Court will not engage in statutory interpretation if a statute is plain and unambiguous. Miss. Methodist Hosp. and Rehab. Ctr., 21 So.3d at 607. See also Bellsouth Telecomms., Inc. v. Miss. Pub. Serv. Comm'n, 18 So. 3d 199, 203 (Miss. 2009) ("When the language used by the Legislature is plain and unambiguous and the statute conveys a clear and definite meaning, as here, the Court will have no occasion to resort to the rules of statutory interpretation."); Marx v. Broom, 632 So. 2d 1315, 1318 (Miss.1994) ("Courts have a duty to give statutes a practical application consistent with their wording, unless such application is inconsistent with the obvious intent of the legislature.").
¶ 27. Section 41-7-195(1)-(2) is plain and unambiguous in stating that a CON "shall be valid for the period of time specified therein," and that such period shall not exceed twelve months. Miss. Code Ann. § 41-7-195(1)-(2). The statutory section makes clear that, unless the CON holder requests an extension of the CON before the time period stated in the *1213 CON lapses, the CON will expire and become void at the end of that specified period. Miss.Code Ann. § 41-7-195(1)-(3) (Rev.2009).
¶ 28. In the instant case, the MSDH issued RCG a CON on December 16, 2004, set to expire twelve months later on December 16, 2005. Not until January 8, 2007one year and twenty-three days after the expiration date of RCG's CON did RCG apply for an extension of this CON. By January 2007, RCG's CON clearly had expired, and the MSDH did not have the authority to contravene Section 41-7-195 and revive RCG's expired CON by issuing RCG a six-month CON extension. It is plain error to interpret Section 41-7-195 to mean that the MSDH has the discretion to take such an action, and the MSDH's adoption of such an interpretation is an abuse of discretion. After the stated expiration of a CON, the MSDH must reopen the CON application and review process as provided by statute and regulation.
¶ 29. Moreover, at the time that Dialysis Solution filed its Complaint (i.e., on October 23, 2007), the MSDH's own Certificate of Need Review Manual, which sets forth the rules and regulations governing CONs, stated:
102 Six-Month Extension
102.01 Certificates of Need are valid for a period not to exceed one year and may be extended by the Department for an additional period not to exceed six months.
Mississippi State Department of Health, Certificate of Need Review Manual, Chapter 6-Subsequent Reviews, Effective: September 8, 2007. This rule, reiterating Section 41-7-195, supports the contention that a CON becomes void on the expiration date stated in the CON (unless an extension of the CON is timely requested).
¶ 30. Section 41-7-185(c) of the Health Care CON Law authorizes the MSDH to "promulgate such reasonable rules and regulations as may be necessary to the implementation of the purposes of § 41-7-171, et seq. [i.e., the Health Care CON Law]." Miss.Code Ann. § 41-7-185(c) (Rev.2009). In addition, Section 41-7-187 authorizes the MSDH to adopt rules and regulations regarding the issuance of CONs. Miss.Code Ann. § 41-7-187 (Rev. 2009).[5] However, Section 41-7-195 makes clear that the Legislature did not intend for the MSDH's rule-making authority to extend to promulgation of rules regarding how long a CON can be outstanding. The existence of Section 41-7-195 indicates that the Legislature wanted to control through statute the time period for which a CON could be outstanding. Presumably, the Legislature would not have enacted Section 41-7-195 if it had intended CONs to remain valid indefinitely or until the MSDH chose to revoke them.
*1214 ¶ 31. Nowhere in the statute does the Legislature grant the MSDH the authority to promulgate a rule to revive and extend an expired CON, and "a statutory agency has only legislation [sic] granted authority, there is not inherent authority." Miss. Pub. Serv. Comm'n v. Miss. Power & Light Co., 593 So. 2d 997, 999 (Miss.1991). An agency cannot grant itself broader authority than the Legislature gave it. See id. (". . . [T]his Court has repeatedly stated that powers legislatively granted to and exercised by an administrative agency are limited to and must not exceed the authority prescribed by the legislative enactment."). Rules and regulations must be consistent with the relevant statutes. See id. ("Statutory provisions control with respect to the rules and regulations promulgated by [an administrative agency]. Accordingly, [an administrative agency] may not make rules and regulations which conflict with, or are contrary to, the provisions of a statute, particularly the statute it is administering or which created it."). Therefore, the MSDH did not have the authority to grant RCG an extension of its CON after the CON had expired (nor the authority to promulgate a rule (in October 2007) stating that holders of expired CONs have the right to request an extension of their CONs within the first fifteen days following the adoption of the new Rules).
¶ 32. For several reasons, it is illogical to argue that the MSDH's new Rulesi.e., the Temporary Rule RCG adopted on October 29, 2007, which became a Permanent Rule on February 23, 2008in some way corrected or sanctioned the MSDH's prior unlawful decisions to grant RCG extensions on an expired CON. First, an agency's promulgation of rules that (aside from one provision dealing with expired CONs) are consistent with a governing statute does not mean that, prior to the adoption of such rules, the agency did not have an obligation to limit its authority to that granted to it by the governing statute. In other words, while it is fully within the MSDH's authority to promulgate rules regarding CON extensions consistent with Section 41-7-195, the fact that it did so (in October 2007) does not mean that prior to promulgation of such rules, Section 41-7-195 was unclear or not authoritative. Nor does it negate the fact that RCG failed to request an extension of its CON prior to its CON's December 16, 2005, expiration date.
¶ 33. Second, as noted above, the provision included in the new MSDH Rules granting holders of expired CONs the right to request an extension of their CONs within the first fifteen days following the adoption of the new Rules was not within the MSDH's authority to promulgate.
¶ 34. Third, and perhaps most importantly, the MSDH did not propose its Temporary Rule until October 26, 2007, three days after Dialysis Solution had filed its Complaint in this matter and served the MSDH with process. The Temporary Rule did not become effective until October 29, 2007, and it did not become a Permanent Rule until February 24, 2008. Thus, the argument made by the defendants and adopted by the trial court that these Rules somehow remedied any of the actions for which Dialysis Solution was suing the defendants is flawed, because these new Rules were not proposed until after the lawsuit had begun.
¶ 35. In addition, the fact that the new Rulesaside from the one provision making an exception for holders of currently expired CONsadopt Dialysis Solution's and the Attorney General's interpretation *1215 of Section 41-7-195 is evidence that the MSDH does not, and knows it does not, have the authority to revive and extend expired CONs.
¶ 36. The Attorney General's Opinion of October 12, 2007, supports Dialysis Solution's argument that the MSDH has at all times lacked the authority to revive and extend an expired CON. While Attorney General's Opinions are not binding, this Court certainly may consider them. Tupelo Redevelopment Agency v. Gray Corp., Inc., 972 So. 2d 495, 509 (Miss. 2007). It is the stated opinion of the Attorney General's Office that, after the CON's stated date of expiration, the CON is automatically void by operation of law, and no action on the part of the MSDH is needed to finalize the CON's voided status. Op. Att'y Gen.XXXX-XXXXX (Miss. Oct. 12, 2007). The Attorney General's Office elaborates:
The statute expressly provides that a CON is valid only for the time period stated therein . . . . [and][o]nce the time period stated in the CON has lapsed, the CON is void and no extensions can be granted. At that point, the applicant would be required to reapply for a CON.
Op. Att'y Gen.XXXX-XXXXX (Miss. Oct. 12, 2007).
¶ 37. Lastly, the fact that RCG's CON has been fully implemented and its dialysis facility is currently licensed and serving public health needs is irrelevant to the legal issues this Court must decide. Construction of RCG's dialysis facility was still in its infancy when Dialysis Solution filed suit against it challenging the validity of its CON, and RCG's decision to continue to construct the facility after the lawsuit was filed should not affect the merits of Dialysis Solution's claims. In City of Durant v. Humphreys County Memorial Hospital/Extended Care Facilitya case in which the City of Durant challenged the Mississippi Health Care Commission's[6] issuance of a CON to a hospital for the construction of a nursing homethis Court held:
. . . where an appellant's original action was timely and where he has promptly prosecuted his appeal, the completion of an act based upon improper authority does not legitimate the act or render the legal issues moot. . . . Here, plaintiffs sued within a reasonable time of learning of the outstanding CON and while HCMH/ECF's [i.e., the defendant's] construction was in its infancy. . . . That the evidence of HCMH/ECF's authority may have metamorphosed from CON to license hardly renders moot the core controversy.
City of Durant v. Humphreys County Mem'l Hosp./Extended Care Facility, 587 So. 2d 244, 249-50 (Miss.1991) (citations omitted). While the defendants in the instant case are not arguing that the issues Dialysis Solution raises are moot because RCG's dialysis facility is now operational, the defendants do suggest that this Court should consider the harm that would result to ESRD patients if the operation of RCG's dialysis facility were impeded.
¶ 38. Like the plaintiff in City of Durant, Dialysis Solution filed a timely complaint, doing so while construction of RCG's dialysis facility was still in its infancy, and subsequently timely appealed to this Court. As explained above, in a letter *1216 dated September 27, 2007, Dialysis Solution requested a public hearing for revocation of RCG's CON, arguing that pursuant to Section 41-7-195, the MSDH is forbidden from extending a CON after the CON has lapsed (and forbidden from extending a CON for any amount of time exceeding six months). In a letter dated October 12, 2007, the MSDH denied Dialysis Solution's request for a public hearing on the revocation of RCG's CON. Therefore, on October 23, 2007a reasonable time after the MSDH had denied its request for a public hearingDialysis Solution filed a Complaint for Declaratory Judgment and Injunctive Relief in the Chancery Court for the First Judicial District of Hinds County, Mississippi. In addition, on February 20, 2008, Dialysis Solution filed a Motion for Temporary Restraining Order and/or Preliminary Injunction, requesting that the trial court enjoin RCG from continuing any construction of its dialysis facility until after the trial court ruled on the matter. At the time the Complaint was filed, construction of RCG's facility was still in its infancy; construction had begun only the previous month (or perhaps even later this is a disputed fact), and it was not completed until nearly a year later. In sum, because Dialysis Solution's original action was timely filed and it promptly prosecuted its appeal, RCG's completion of its dialysis facility following the commencement of the lawsuit does not legitimate the act of building a facility while not possessing a valid CON.[7]
¶ 39. For the foregoing reasons, we find that a CON is valid only for the time period stated therein, and the MSDH does not have the legal authority to revive and extend a CON when a CON holder has failed to request an extension prior to the expiration date of its CON. Therefore, RCG's CON for the ESRD facility in Montgomery County was void as of December 16, 2005, its stated expiration date, and the MSDH did not have the authority to revive and extend it after that date.
CONCLUSION
¶ 40. Accordingly, we reverse the trial court's holding that the MSDH had the authority to grant RCG an extension of its CON in January 2007, more than one year after RCG's CON had expired. RCG's CON is void by operation of law. If the MSDH still wants to issue a CON for an ESRD facility in Montgomery County, it will have to reopen the CON application and review process as provided by statute and regulation.
¶ 41. REVERSED AND RENDERED.
WALLER, C.J., CARLSON, P.J., DICKINSON, RANDOLPH, LAMAR, KITCHENS, CHANDLER AND PIERCE, JJ., CONCUR.
NOTES
[1] State Health Officer Dr. Ed Thompson passed away during the pendency of this appeal, and pursuant to Miss. R.App. P. 43(c)(1), Interim State Health Officer Dr. Mary Currier was automatically substituted in her official capacity. She later was confirmed as permanent State Health Officer.
[2] The land for the RCG facility was purchased on February 2, 2007, and the closing for the land was on March 17, 2008. RCG planned a groundbreaking ceremony for November 16, 2007. RCG submitted documentation of commencement of the project to the MSDH on December 18, 2007.
In a brief that the defendants submitted to the trial court, they stated:
. . . RCG has been engaged in developing and constructing the ESRD facility in Winona for more than five (5) months [from the date of February 29, 2008i.e., since approximately September 2007]. The project is well underway. . . .
Additionally, in defendants' brief to this Court, they state that, at the time Dialysis Solution sought injunctive relief (i.e., in October 2007), RCG's dialysis facility was "already well under construction. . . ."
However, in Dialysis Solution's brief to this Court, it claims that, "at the time this action was brought [on October 23, 2007], not only, had construction not commenced but the property for the facility had not been acquired."
It is not crucial to determine whether construction of the RCG facility commenced in September 2007 or a few months later; the relevant point, as discussed later in this opinion, is that construction of the facility was in its infancy when Dialysis Solution filed its Complaint in October 2007.
[3] In the defendants' brief to this Court, they state that, in a staff analysis report that the MSDH had prepared for review by the State Health Officer, the MSDH had recommended disapproval of Dialysis Solution's CON application. The defendants explain in more detail:
Dialysis Solution failed to submit all necessary information in order to have the [CON] application [for its own ESRD facility in Montgomery County] deemed complete. As a result, the Dialysis Solution CON application was not deemed complete until October 1, 2007, nearly a year after the initial filing.
In November of 2007, the MSDH issued a staff analysis report on the Dialysis Solution CON application. In that report, the MSDH recommended disapproval of the Dialysis Solution application. The MSDH staff concluded that the Dialysis Solution application was not in compliance with the applicable CON criteria and standards, and recommended that the proposal not be approved.
Notably, the MSDH staff analysis report was issued to the State Health Officer in November 2007i.e., shortly after Dialysis Solution filed its Complaint against the MSDH.
[4] While it is not necessary to analyze more than one instance of the MSDH granting RCG an extension after RCG's CON had expired, it should be noted that RCG's request for a second six-month extension was made after the first six-month extension had expired.
[5] Section 41-7-187 states in full:
The State Department of Health is hereby authorized to develop and implement a statewide health certificate of need program. The State Department of Health is authorized and empowered to adopt by rule and regulation:
(a) Criteria, standards and plans to be used in evaluating applications for certificates of need;
(b) Effective standards to determine when a person, facility or organization must apply for a certificate of need;
(c) Standards to determine when a change of ownership has occurred or will occur; and
(d) Review procedures for conducting reviews of applications for certificates of need.
Miss.Code Ann. § 41-7-187 (Rev.2009).
[6] The Mississippi Health Care Commission (MHCC) was once an administrative agency of the State of Mississippi. Prior to July 1, 1986, MHCC administered the CON program. City of Durant v. Humphreys County Mem'l Hosp./Extended Care Facility, 587 So. 2d 244, 246 (Miss.1991).
[7] The defendants also argue that Dialysis Solution should be faulted for not contesting the new Rules adopted by the MSDH regarding CON extensions "despite [having] the right to do so under the Mississippi Administrative Procedures Law, as well as pursuant to the administrative rule-making process followed by the MSDH in enacting the CON regulations." Whether or not Dialysis Solution contested the new Rules is irrelevant, because as noted earlier, the new Rules were promulgated after Dialysis Solution filed suit and served the MSDH with process. In its brief to this Court, Dialysis Solution explains that it "has no issue with the MSDH's adoption of the temporary and permanent rule changes concerning the validity, duration and extension of CONs" because "[both] the temporary and permanent rules adopted by MSDH did not take effect until after the Plaintiff filed suit. . ." and "subsequent actions on the part of the MSDH do not change the facts and law as they were on October 23, 2007 when the lawsuit was filed." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581604/ | 42 So.3d 795 (2010)
ADVISORY OPINION TO the GOVERNOR RE JUDICIAL VACANCY DUE TO RESIGNATION.
No. SC10-1186.
Supreme Court of Florida.
July 12, 2010.
Erik M. Figlio, General Counsel, J. Andrew Atkinson and Shachi Mankodi, Assistant General Counsels, Carly A. Hermanson, Deputy General Counsel, Executive Office of the Governor, Tallahassee, FL, for The Honorable Charles J. Crist, Jr., Governor of Florida.
Charles F. Beall, Jr. of Moore, Hill and Westmoreland, P.A., Pensacola, Florida, on behalf of Michelle A. Inere, John L. Miller and Clara E. Smith; and Joseph L. Hammons of The Hammons Law Firm, P.A., Pensacola, FL, on behalf of Judge David B. Ackerman, for Interested Parties.
PER CURIAM.
By letter dated June 21, 2010, Governor Charlie Crist requested our opinion on a question of constitutional interpretation involving his executive powers and duties with regard to a judicial vacancy in the Escambia County Court. This request and our response are made pursuant to article IV, section (1)(c) of the Florida Constitution.
Governor Crist's letter states as follows:
By letter dated May 24, 2010, Judge David B. Ackerman, formerly a county court judge on the Escambia County Court, submitted a letter of resignation to my office. I accepted Judge Ackerman's resignation on May 28, 2010.
Prior to his resignation, Judge Ackerman's term of office was scheduled to expire on January 3, 2011. The new term, commencing on January 4, 2011, is scheduled to be filled by regular election this year. Pursuant to section 105.031, Florida Statutes, the time for qualifying to run for this seat began at noon on April 26, 2010, and ended at noon on April 30, 2010. Judge Ackerman submitted qualifying papers on April 28, *796 2010. No other candidate qualified during the qualifying period.
There will be an actual vacancy on the Escambia County Court for a period of at least seven months if the vacancy resulting from Judge Ackerman's resignation is to be filled by election. As a result of his qualifying unopposed, Judge Ackerman will be deemed elected for a new term commencing January 4, 2011, pursuant to section 105.051(1)(a), Florida Statutes. However, I have been informed that Judge Ackerman does not intend to resume his judicial duties until February 1, 2011.
. . . .
In previous advisory opinions, the Justices of this Court have opined that the Governor's power of appointment outlined in [article V, section 11(b) of the Florida Constitution] yields to the election process, with respect to contested seats, at the commencement of the qualifying period. The primary rationale for that exclusion has been the Justices' view that tension exists between Article V, section 11(b) and Article V, section 10(b)(1) and 10(b)(2), which state that the election of circuit court and county court judges "shall be preserved," absent referendum of the voters to adopt retention elections as a local option. ... The Justices have never addressed this tension in circumstances such as those presented here, where an incumbent judge resigns following an uncontested qualifying period.
. . . .
In light of the foregoing, I respectfully request an opinion of the Justices of the Supreme Court as to whether the Governor's constitutional responsibility to fill vacancies on circuit and county courts by appointment exists when a vacancy on such a court occurs after the conclusion of a qualifying period in which no candidates other than the incumbent judge have qualified for election.
Letter from Governor Charlie Crist to Chief Justice Peggy A. Quince dated June 21, 2010 at 1-3. On June 22, 2010, this Court issued an order permitting all interested parties to file briefs on an expedited basis. Governor Crist, three of the individuals nominated by the First Circuit Judicial Nominating Commission to fill the judicial vacancy, and Judge Ackerman filed briefs.
ANALYSIS
Florida Constitution article X, section 3, states that a "[v]acancy in office shall occur upon the creation of an office, upon the death, removal from office, or resignation of the incumbent or the incumbent's succession to another office, unexplained absence for sixty consecutive days, or failure to maintain the residence required when elected or appointed, and upon failure of one elected or appointed to office to qualify within thirty days from the commencement of the term." Here, a vacancy was created on May 28, 2010, when Governor Crist accepted Judge Ackerman's resignation.
As we explained in Advisory Opinion to Governor re Appointment or Election of Judges, 983 So.2d 526, 528 (Fla.2008) (Appointment or Election of Judges 2008), the Florida Constitution contains two provisions that regard the filling of judicial vacancies. Article V, section 11(b), provides that "[t]he governor shall fill each vacancy on a circuit court or on a county court, wherein the judges are elected by a majority vote of the electors, by appointing for a term ending on the first Tuesday after the first Monday in January of the year following the next primary and general election occurring at least one year after the date of appointment, one of not fewer than three persons nor more than six persons *797 nominated by the appropriate judicial nominating commission." Article V, section 10(b)(1)-(2), states that the election of circuit and county court judges "shall be preserved ... unless a majority of those voting in the jurisdiction of that circuit approves a local option to select circuit judges by merit selection and retention rather than by election."
We have interpreted the interplay between article V, section 11(b), and article V, section 10(b), by holding that when a vacancy occurs in the county or circuit courts before the qualifying period for the seat commences, the vacancy should be filled by appointment, but once the election process begins, such a vacancy should be filled by election. Advisory Opinion to Governor re Sheriff & Judicial Vacancies Due to Resignations, 928 So.2d 1218, 1220 (Fla.2006) (Sheriff & Judicial Vacancies); Appointment or Election of Judges 2008, 983 So.2d at 528. In order to promote consistency in the process of filling judicial vacancies, we identified the beginning of the statutory qualifying period as a fixed point to mark the commencement of the election process. Appointment or Election of Judges 2008, 983 So.2d at 529.
Here, the election process began on April 26, 2010, and Judge Ackerman alone qualified for election. Because Judge Ackerman's candidacy was uncontested, pursuant to section 105.051, Florida Statutes (2009), he was deemed elected to serve as a judge on the Escambia County Court for the term beginning January 4, 2011. Thus, this particular election process ended on April 30, 2010, when the qualifying period ended, and no individual other than Judge Ackerman can now fill the vacancy by election.
The circumstances here stand apart from the circumstances we have previously addressed. See Appointment or Election of Judges, 983 So.2d at 530 (holding that a vacancy created "during a qualifying period in which any candidate qualifies for the judicial office is to be filled by election" where the vacancy arose due to the involuntary retirement of a county court judge during the qualifying period); In re Advisory Opinion to Governor re Appointment or Election of Judges, 824 So.2d 132, 135-36 (Fla.2002) (holding that a vacancy created when a judge involuntarily retired after the conclusion of the qualifying periodin which the incumbent judge did not qualify for election but three other candidates did qualifywas to be filled by election); Sheriff & Judicial Vacancies, 928 So.2d at 1220 (holding that vacancy occurred when the Governor accepted the resignation of a circuit court judge on April 14, 2006, and that because the vacancy was created before the qualifying period commenced on May 8, 2006, the position was to be filled by appointment).
Here, an incumbent office holder resigned after the election process had effectively concluded. A vacancy was thus created at a time when the election process had ceased. There is no issue here with regard to preserving the right of the people to elect county court judges. Instead, the issue is whether an incumbent judge who had been reelected without opposition may then retire from office and leave a judgeship vacant for an extended period before resuming the duties of the office when it is convenient for him to do so.
The consideration that must predominate here is the right of the people of Escambia County to the services of a county judge when the incumbent has presented himself to the people for reelection but then has laid aside the duties of his office. Cf. In re Advisory Opinion to the Governor (Judicial Vacancies), 600 So.2d 460, 462 (Fla.1992) ("Vacancies in office are to be avoided whenever possible. We are confident that the framers of article V *798 intended that the nominating and appointment process would be conducted in such a way as to avoid or at least minimize the time that vacancies exist. Judges are encouraged to and do submit their resignations... at a time that permits the process to proceed in an orderly manner and keep the position filled."). A judgeship is not an office that may be temporarily forsaken at will for personal benefit. When a vacancy arises from such circumstances, the Governor may properly fill the vacancy by appointment pursuant to article V, section 11(b).
We are therefore of the opinion that the vacancy created by Judge Ackerman's retirement should be filled by gubernatorial appointment. Under these circumstances, the appointment process will avoid an extended vacancy in the Escambia County Courts and will allow the voters to exercise their will regarding the judicial seat in the 2012 general election.
CONCLUSION
We answer Governor Crist's question about the resignation of Judge Ackerman by stating that it is our opinion that this vacancy should be filled by appointment.
It is so ordered.
CANADY, C.J., and PARIENTE, LEWIS, QUINCE, POLSTON, LABARGA, and PERRY, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583717/ | 427 So.2d 1320 (1983)
H.O. MOORE, et al., Plaintiff-Appellant,
v.
Katherine Collins MOORE, et al., Defendant-Appellee.
No. 15,201-CA.
Court of Appeal of Louisiana, Second Circuit.
February 22, 1983.
*1321 Nolan J. Edwards, Crowley, for plaintiffappellant.
Culpepper, Teat & Caldwell by Bobby L. Culpepper, Jonesboro, for defendant-appellee.
Before JASPER E. JONES, SEXTON and NORRIS, JJ.
NORRIS, Judge.
Plaintiffs appeal a judgment of the trial court sustaining an exception of no cause of action. We reverse and remand.
On November 18, 1981, H.O. Moore, Jenelle Moore, Nedra Moore Taylor and Audra Ruth Moore Grove, filed suit against Katherine Collins Moore, Pauline Moore Lewis, Melinda Moore Davis and Robert Moore alleging that plaintiffs, together with Louis Moore and Pauline Moore, are the children of W.O. Moore and Myrtice Moore, both of whom are now deceased. In the original petition, plaintiffs further alleged that three sales of immovable property, described in the original petition and reflected by copies of deeds attached to that petition, executed by W.O. Moore and Myrtice Moore to their son Louis Moore, now deceased and survived by his wife Katherine Moore and two children, Robert Moore and Melinda Moore Davis, were simulations or alternatively donations in disguise that exceeded the disposable portion. Plaintiffs further alleged that the estates of W.O. Moore and Myrtice Moore were represented by Katherine Moore, Pauline Lewis and Donald Ray Lewis as co-administrators, who failed to render a proper accounting of the estates despite demand to deliver the assets of the estates. Therefore, plaintiffs allege that they are entitled to damages for the failure to properly account and deliver as well as attorneys' fees. Finally, plaintiffs prayed for judgment annulling and setting aside the acts of conveyance, ordering an accounting, and for damages, attorneys' fees, interest, costs and all general and equitable relief.
After the trial court sustained certain dilatory and declinatory exceptions, an amended and supplemental petition was filed in which plaintiffs alleged that Louis Moore was deceased and survived by his wife and two children. It was further alleged that the succession of W.O. Moore was opened in Jackson Parish, that there was no succession opened for Myrtice Moore, who had died subsequent to her husband and that Dennis Louis Moore's succession was opened in Jackson Parish.
With the record in this posture, defendants filed an exception of no cause of action on the basis that the conveyances alleged to be simulations "speak for themselves" and clearly show that they are not simulations and donations in disguise; that plaintiffs *1322 are not entitled to an accounting because of the validity of the conveyances; that there is no showing of damage as a result of the failure to account; and that there is no allegation of a cause of action under Louisiana law entitling plaintiffs to attorneys' fees.
In written reasons for judgment on the exception, the trial court sustained the exception concluding that although the petition alleged the deeds to be simulations and donations in disguise, that because the deeds were attached as exhibits to the petition the contents of the deeds must be considered to be true. Therefore, because the deeds recited cash considerations,[1] plaintiffs were bound by the truthfulness of those allegations of consideration, and the petition did not allege a cause of action.
Judgment was signed sustaining the exception and dismissing the action. It is from this judgment that plaintiffs appeal.
La.C.C.P. Art. 931 provides in pertinent part:
* * * * * *
No evidence may be introduced at any time to support or controvert the objection that the petition fails to state a cause of action.
This rule is amplified in Adserv Corp. v. Lincecum, 385 So.2d 432 (La.App. 1st Cir. 1980) wherein it was stated:
The peremptory exception of no cause of action is tried on the face of the petition and "no evidence may be introduced at any time to support or controvert the objection that the petition fails to state a cause of action." La.C.C.P. Art. 931.
The purpose of the exception of no cause of action is to determine whether under the allegations of the petition the law affords any remedy for the particular grievance complained of. Bamber Contractors, Inc. v. Henderson Brothers, Inc., 345 So.2d 1212 (La.App. 1st Cir.1977); Guillory v. Nicklos Oil and Gas Company, 315 So.2d 878 (La.App. 3rd Cir.1975); American Bank & Trust Company v. French, 226 So.2d 580 (La.App. 1st Cir. 1969). And in determining whether the petition states a cause of action, every reasonable interpretation must be afforded its language so as to maintain the sufficiency of the petition and to afford plaintiff his day in court. Hero Lands Company v. Texaco, 310 So.2d 93 (La. 1975).
While we are aware that documents annexed to the petition may also be considered in determining whether or not a cause of action is stated [See Moore v. Shell Oil Co., 228 So.2d 205 (La.App. 3d Cir. 1969).], we further conclude that the trial court was clearly wrong in concluding from the annexed deeds that the recitations in the deeds when accepted as being true defeated plaintiffs' cause of action.
La.C.C. Art. 2444 states:
The sales of immovable property made by parents to their children, may be attacked by the forced heirs as containing a donation in disguise, if the latter can prove that no price has been paid, or that the price was below one-fourth of the real value of the immovable sold, at the time of the sale.
La.C.C. Art. 2239 states:
Counter letters can have no effect against creditors or bonafide purchasers; they are valid as to all others; but forced heirs shall have the same right to annul absolutely and by parol evidence the simulated contracts of those from whom they inherit, and shall not be restricted to the ligitimate [legitime]. [Emphasis added.]
It is therefore well settled that forced heirs have an absolute right to annul by parol evidence the simulated contracts of those from whom they inherit and in this regard are not restricted to their legitime. Succession of Webre, 247 La. 461, 172 So.2d 285 (1965); Miles v. Miles, 328 So.2d 394 (La.App. 3d Cir.1976).
*1323 A simulation is a transfer of property which is not what it seems. Simulations are of two types; pure simulations and disguised transfers. In a pure simulation, sometimes called a non transfer, the parties only pretend to transfer the property from one to the other, but in fact both transferor and transferee, intend that the transferor retain ownership of the property. When this type of simulation is successfully attacked, the true intent of the parties is revealed; that is, that no transfer had in fact taken place. The other type of simulation is a disguised transfer which seems on its face to be a valid sale, but in fact is actually intended by the parties to be a gift rather than a sale. When this type of simulation is attacked successfully under Article 2444, the true intent of the parties is likewise effectuated by the law. A valid transfer has taken place but its form is a donation rather than a sale and the Code articles on donations apply to the transfer. See Owen v. Owen, 336 So.2d 782 (La.1976); La.C.C. Art. 1493 et seq.
Whether or not a transaction is simulated is a matter to be decided in light of the circumstances of each case. See Milano v. Milano, 243 So.2d 876 (La.App. 1st Cir. 1971).
While the petitions in the instant case are admittedly inartfully drafted, a reasonable interpretation of them results in our finding that plaintiffs, who are the forced heirs of the deceased transferor, are seeking to nullify three conveyances to their deceased brother as simulations or donations in disguise which impinge upon their legitime. The documents attached to the petition cannot be viewed as defeating this action because it is the validity of the documents themselves which forms the very crux of this cause of action. If we were to uphold the action of the trial court as being a proper interpretation of the law, our ruling would in effect render nonexistent a cause of action clearly provided for by law. In this case, the question of consideration for a sale or lack thereof is an issue which must be determined by means other than the exception of no cause of action. To hold otherwise would be to ignore the purpose of Article 2239 as explained in Succession of Clark, 155 So.2d 37 (La.App. 4th Cir.1963):
... Article 2239, which appears in the Code under a Chapter entitled "OF THE PROOF OF OBLIGATIONS AND OF THAT OF PAYMENT" and under a section and subsection entitled, respectively, "OF THE LITERAL PROOF" and "OF AUTHENTIC ACTS" does not establish a property right; it establishes only a rule of evidence. It does not change the obligation of forced heirs in respect to the burden which they bear regarding presumptions and proof, nor does it enlarge the right of a forced heir to the legitime or decrease the disposable portion of those from whom forced heirs inherit. It does extend to forced heirs the right to use parol evidence in annulling the simulated contracts of those from whom they inherit and in that use the forced heirs are not restricted to the legitime even in cases, as for example collation, where the question of exceeding the legitime is not involved. See Byrd v. Pierce, 124 La. 429, 445, 50 So. 452, 457; Wells v. Goss, 110 La. 347, 357, 34 So. 470, 474; Reinerth v. Rhody, 52 La.Ann. 2029, 2035, 28 So. 277, 279. [Emphasis added.]
Having found that the plaintiff's petition states a cause of action to annul the conveyances referred to therein as being simulations or donations in disguise, the exception of no cause of action must be overruled. When a petition states a cause of action as to any ground or portion of the demand, the exception must be overruled. Leenerts Farms, Inc. v. Rogers, 421 So.2d 216 (La.1982); Rodriguez v. American Bankers Ins. Co. of Florida, 386 So.2d 652 (La.1980).
As we stated in Walker v. Western Southern Life Ins. Co., 361 So.2d 892, 894 (La.App. 2d Cir.1978):
Our Code of Civil Procedure does not provide for an exception of partial no cause of action. The effect of sustaining a peremptory exception is that the action shall be dismissed, not that part of the action be dismissed. La.C.C.P. Art. 934. * * * [Emphasis added.]
*1324 Therefore, we do not consider the other assertions of the defendants in support of the exception, leaving it to the trial court to exclude evidence relating to the action for accounting, for damages for failure to account and deliver property and attorneys' fees if the trial court believes such to not be recoverable. See Rodriguez v. American Bankers Ins. Co. of Florida, supra.
Accordingly, the ruling of the trial court sustaining the exception of no cause of action is reversed, the exception is overruled and this case is remanded to the district court for further proceedings.
JUDGMENT REVERSED AND REMANDED.
NOTES
[1] The trial judge referred to the deeds in question as cash sale deeds but the record in fact shows one was a cash sale deed and the other two were credit sale deeds secured by vendor's liens. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583721/ | 427 So.2d 276 (1983)
John T. BECKUM, O.D., Petitioner,
v.
STATE of Florida, DEPARTMENT OF PROFESSIONAL REGULATION, BOARD OF OPTOMETRY, Respondent.
No. AR-104.
District Court of Appeal of Florida, First District.
February 16, 1983.
Rehearing Denied March 9, 1983.
Stephen Marc Slepin, of Slepin, Slepin, Lambert & Waas, Tallahassee, for petitioner.
Joseph W. Lawrence, II, Deputy Gen. Counsel, Tallahassee, for Dept. of Professional Regulation, for respondent.
ROBERT P. SMITH, Jr., Chief Judge.
We deny Beckum's Rule 9.100 petition for review of nonfinal agency action. See § 120.68(1), Florida Statutes (1982).
Beckum's petition complains of the February 2, 1983 order of hearing officer Benton, denying in part Beckum's motion to dismiss disciplinary proceedings against him by the Department of Professional Regulation pursuant to section 455.225, Florida Statutes (1981). Beckum, a licensed optometrist, urged to the hearing officer that the complaint, referred to the Division of Administrative Hearings on a finding of probable cause by a probable cause panel of the Board of Optometry, should be dismissed for failure of the probable cause panel to record its proceedings electronically "in a manner sufficient to assure the accurate transcription of all matters so recorded," section 455.203(7). The recording machine inexplicably did not operate properly. Beckum *277 also avers a violation of section 455.221(2), providing that "no attorney employed or utilized by the department shall prosecute a matter and provide legal services to the board with respect to the same matter."
Because the panel's probable cause proceedings were imperfectly recorded, the panel reconstituted its proceedings through depositions of panel members, a process that the hearing officer accepted in lieu of a recording, reasoning that the panel at least attempted to comply with the recording requirement. But Beckum urges that the absence of an accurate recording of the original probable cause proceedings effectively deprives him of his asserted entitlement to assure that the probable cause proceedings met standards prescribed by Kibler v. Department of Professional Regulation, 418 So.2d 1081, 1084 (Fla. 4th DCA 1982):
To sustain a probable cause determination there must be some evidence considered by the panel that would reasonably indicate that the violations alleged had indeed occurred.
If the asserted errors and omissions of the probable cause panel could be considered jurisdictional in any sense, implicating its power to act at all in the premises, Beckum might argue with some merit that he should have immediate section 120.68(1) judicial review, through Rule 9.100, of the hearing officer's "preliminary, procedural, or intermediate" ruling. For in that case it might be said that "review of the final agency decision would not provide an adequate remedy" to one who, as a result of an erroneous preliminary ruling, must now undergo disciplinary proceedings with all they entail in loss of time, expense, and damage to professional reputation. But as these asserted irregularities are in no sense jurisdictional, and the disciplinary proceedings to follow will be vitiated only upon a finding that "the fairness of the proceedings or the correctness of the action may have been impaired by a material error in procedure or a failure to follow prescribed procedure," section 120.68(8), we think it evident that Beckum has failed to demonstrate grounds for Rule 9.100 intervention by this court. He has not shown that "review of the final agency decision would not provide an adequate remedy." Section 120.68(1). We intimate no view of whether or to what extent the hearing officer preliminarily, or this court upon review of final agency action, should examine the record of the probable cause proceedings in search of "some evidence ... that would reasonably indicate that the violations alleged had indeed occurred." Kibler, 418 So.2d at 1084.
The petition for review of non-final administrative action is DENIED.
LARRY G. SMITH and THOMPSON, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2758962/ | Case: 13-15388 Date Filed: 12/09/2014 Page: 1 of 9
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-15388
Non-Argument Calendar
________________________
D.C. Docket No. 1:12-cr-20152-FAM-5
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
JULIAN BREAL,
Defendant-Appellant.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(December 9, 2014)
Before WILLIAM PRYOR, JULIE CARNES, and FAY, Circuit Judges.
PER CURIAM:
Case: 13-15388 Date Filed: 12/09/2014 Page: 2 of 9
Julian Breal challenges his convictions and sentence of imprisonment for 50
years for conspiracy to commit hostage taking, 18 U.S.C. § 1203(a), hostage
taking, id., kidnapping, id. § 1201(a)(1), carjacking, id. §§ 2119, 1365, and
possession of a firearm in furtherance of a crime of violence, id. §§ 924(c)(1)(a).
We affirm.
I. BACKGROUND
Breal and five others conspired to rob a drug dealer. Breal provided
information about the victim, his assets, and his movements, so that the other
conspirators, none of whom was known to the victim, could execute the robbery.
The other conspirators agreed that Breal would receive a share of the proceeds of
their crime.
The conspirators’ initial plan was to intercept the victim on his return from a
fishing trip, but the conspirators altered their plan when Breal learned that the
victim had sold his fishing boat. They decided instead to rob the victim’s house.
Breal provided the address and agreed to serve as lookout. But there were too
many people at the victim’s house, so the conspirators aborted the robbery.
Breal’s coconspirators later abducted the victim at gunpoint as he was
exiting a bar. They drove to a coconspirator’s house, where they tortured the victim
and demanded names of people they could call to demand ransom. Breal was not
present, but after the victim provided several names, one of the coconspirators
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called Breal, told Breal “we got him,” and asked Breal to confirm the names and
phone numbers as potential targets for ransom money. Breal confirmed the
information. The coconspirators then called the victim’s brother, tortured the
victim so that he screamed over the phone, and demanded ransom.
About two months later, the police interviewed Breal. After he waived his
right to counsel and his right to remain silent, Breal confessed to his role in the
crimes. All of the coconspirators pleaded guilty, save for Breal. He was convicted
following a jury trial.
II. STANDARDS OF REVIEW
This appeal is governed by three standards of review. We review a motion to
suppress as a mixed question of law and fact: we review questions of law de novo,
and we review findings of fact for clear error. United States v. Delancy, 502 F.3d
1297, 1304 (11th Cir. 2007). We review motions to dismiss an indictment for
abuse of discretion, but review the legal sufficiency of the allegations in an
indictment de novo. United States v. York, 428 F.3d 1325, 1332 n.8 (11th Cir.
2005). When a defendant raises an objection for the first time on appeal, we review
for plain error. United States v. Madden, 733 F.3d 1314, 1320–21 (11th Cir. 2013).
III. DISCUSSION
We divide our discussion in five parts. First, we explain that the district
court did not err when it denied Breal’s motion to suppress. Second, we explain
3
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that the district court did not err when it refused to dismiss the indictment. Third,
we explain that the district court did not err when it instructed the jury on a
Pinkerton theory of liability. Fourth, we explain that Breal has not established that
the instruction to the jury on aiding and abetting warrants reversal on plain error
review. Fifth, we explain that Breal has failed to establish that his sentence is
substantively unreasonable.
A. The District Court Did Not Err When It Denied Breal’s Motion to Suppress.
Breal argues that his inculpatory statements to the police should have been
suppressed because he was not read his rights under Miranda v. Arizona, 384 U.S.
436, 86 S. Ct. 1602 (1966), until after he confessed, but this argument fails. Three
detectives testified that Breal signed a statement waiving his rights before he
revealed his role in the crimes. Breal’s only contrary evidence is his own
testimony, which the district court found incredible. The record supports that
finding. We will disturb a credibility determination only if the credited testimony is
so “inconsistent or improbable on its face that no reasonable factfinder could
accept it.” United States v. Ramirez-Chilel, 289 F.3d 744, 749 (11th Cir. 2002)
(internal quotation marks omitted). In his testimony, Breal contradicted himself
and asserted that, in thirteen prior arrests, he had never been read his Miranda
rights. The district court did not clearly err when it found the detectives’ accounts
credible and Breal’s testimony incredible.
4
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B. The District Court Did Not Err When It Refused to Dismiss the Indictment.
Breal argues that the indictment against him for kidnapping should have
been dismissed because there was insufficient evidence to convict him, but Breal
misunderstands the grounds for dismissing an indictment. An indictment must
present the essential elements of the offense, notify the accused as to the charges,
and enable the accused to rely upon a judgment as a bar against double jeopardy.
United States v. Steele, 178 F.3d 1230, 1233–34 (11th Cir. 1999). The district court
may not dismiss an indictment based on factual insufficiency, as the sufficiency of
“a criminal indictment is determined from its face.” United States v. Salman, 378
F.3d 1266, 1268 (11th Cir. 2004). Because the indictment accurately quoted the
language of the statute that Breal was charged with violating, 18 U.S.C. §
1201(a)(1), the indictment was sufficient.
And even if we construe Breal’s brief to argue that the evidence was
insufficient to prove kidnapping, his argument fails. We will not disturb a guilty
verdict unless no trier of fact could have found guilt beyond a reasonable doubt.
United States v. Silvestri, 409 F.3d 1311, 1327 (11th Cir. 2005). The evidence at
trial supports the jury’s finding that Breal helped others kidnap someone at
gunpoint, hold the victim for ransom, and use cell phones in furtherance of the
5
Case: 13-15388 Date Filed: 12/09/2014 Page: 6 of 9
kidnapping. See United States v. Evans, 476 F.3d 1176, 1180-81 (11th Cir. 2007)
(holding that the use of a cellphone is sufficient to satisfy an element of use of
interstate commerce). That evidence supports Breal’s conviction.
C. The District Court Did Not Err When It Instructed the Jury on Pinkerton
Liability.
Breal argues that the court should not have instructed the jury on a Pinkerton
theory of culpability, but this argument fails. Under the Pinkerton theory, a
defendant can be held liable for all reasonably foreseeable offenses committed by
coconspirators during and in furtherance of the conspiracy. Pinkerton v. United
States, 328 U.S. 640, 645–48, 66 S. Ct. 1180, 1183–84 (1946). The question of
foreseeability is a question for the jury, so we review only whether the evidence
was sufficient for a reasonable jury to find beyond a reasonable doubt that the
charged substantive offense was a reasonably foreseeable consequence of the
charged conspiracy. See United States v. Alvarez, 755 F.2d 830, 848 (11th Cir.
1985). Because the charged conspiracy was hostage taking, the substantive
offenses of hostage taking and kidnapping were foreseeable. The substantive
offense of carjacking was foreseeable because the original plan involved a
carjacking. And the carrying or use of a firearm during the carjacking and
kidnapping of a drug dealer was reasonably foreseeable, based on the inherent
dangers of the drug trade and the planned violent conduct in abducting the victim.
Cf. United States v. Pham, 463 F.3d 1239, 1246 (11th Cir. 2006) (concluding that
6
Case: 13-15388 Date Filed: 12/09/2014 Page: 7 of 9
it was reasonably foreseeable that a coconspirator would possess a firearm in
conjunction with trafficking in lucrative and illegal drugs).
D. Breal Has Not Established That the Instruction to the Jury on Aiding and
Abetting Warrants Reversal on Review for Plain Error.
Breal also argues that, because Breal did not have advance knowledge that a
firearm would be used, the district court should not have instructed the jury on a
theory of aiding and abetting regarding the charge that he possessed or used a
firearm in furtherance of a crime of violence, 18 U.S.C. § 924(c)(1)(a). We review
this argument for plain error because Breal did not raise this objection in the
district court. See Fed. R. Crim. P. 30. To be sure, when the district judge asked the
parties what objections they would raise at a later charge conference, Breal stated
he was “objecting to the aiding and abetting,” and began to discuss United States v.
Hamlin, which would ostensibly support his objection. 911 F.2d 551 (11th Cir.
1990). But the district judge interrupted Breal and they did not return to the
subject. At charge conferences during the following two days, the district court
asked Breal if he had any objections to the jury instructions in addition to his
objection to the Pinkerton instruction. On neither occasion did Breal argue that the
instructions about aiding and abetting were erroneous, much less present the
“specific grounds” for the objection. United States v. Starke, 62 F.3d 1374, 1381
(11th Cir. 1995).
7
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Breal cannot satisfy his burden under review for plain error. Breal contends
that under Rosemond v. United States, 572 U.S. __, 134 S. Ct. 1240 (2014), aiding
and abetting is relevant to crimes under section 924(c) only where the government
can prove that the defendant knew in advance that a firearm would be used.
Because the jury instructions did not require the government to establish Breal’s
advance knowledge, Breal contends that the instruction was in error. But on review
for plain error, Breal must also make “a specific showing of prejudice,” United
States v. Olano, 507 U.S. 725, 735, 113 S. Ct. 1770, 1778, (1993), and he has not
done so. The government presented evidence that Breal was involved in the
kidnapping and knew the target was a drug dealer. Because he could reasonably
foresee the use of firearms in the furtherance of that conspiracy, Breal could have
been convicted under a Pinkerton theory. Accordingly, Breal has not established
that the instruction about aiding and abetting prejudiced his “substantial rights.”
United States v. Madden, 733 F.3d 1314, 1320-21 (11th Cir. 2013).
Third, Breal contends that the district court erred when it refused to instruct
the jury on multiple conspiracies and withdrawal from the conspiracy, but Breal
provides no argument on this issue. And we need not address it. See Greenbriar,
Ltd. v. City of Alabaster, 881 F.2d 1570, 1573 n. 6 (11th Cir.1989) (because a
passing reference to an issue is insufficient to preserve the issue for appeal, that
issue is deemed abandoned).
8
Case: 13-15388 Date Filed: 12/09/2014 Page: 9 of 9
E. Breal Has Failed to Establish That His Sentence Is Substantively Unreasonable.
Finally, Breal argues that his sentence is substantively unreasonable because
it is unreasonably disparate from the sentences imposed on his coconspirators, see
18 U.S.C. § 3553(a)(6), but this argument fails. Although Breal contends that his
sentence was 13 years longer than the longest sentence imposed on any of his
coconspirators, Breal cannot establish that he was similarly situated to the
defendants who received lesser sentences. See United States v. Docampo, 573 F.3d
1091, 1101 (11th Cir. 2009). Breal presented no evidence that he and his
coconspirators were similarly situated or had comparable records. And Breal fails
to acknowledge that his coconspirators pleaded guilty. Cf. Id. (“[D]efendants who
cooperate with the government and enter a written plea agreement are not similarly
situated to a defendant who provides no assistance to the government and proceeds
to trial.”) Breal has not established that his sentence is substantively unreasonable.
IV. CONCLUSION
We AFFIRM Breal’s convictions and sentence.
9 | 01-03-2023 | 12-09-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1582239/ | 31 So.3d 701 (2009)
DeWayne WOODS
v.
FEDERATED MUTUAL INSURANCE CO.
DeWayne Woods
v.
Plumbing Contractors, LLC, and Timothy M. Sims.
2070867 and 2070872.
Court of Civil Appeals of Alabama.
February 27, 2009.
Rehearing Denied July 2, 2009.
Certiorari Denied September 11, 2009 Alabama Supreme Court 1081364.
*702 Robert D. Bryant of Law Offices of Robert H. Turner, Marion, for appellant.
Jay S. Tuley of Mix Holtsford Gilliland Higgins & Hitson, P.C., Montgomery, for appellees.
*703 THOMPSON, Presiding Judge.
DeWayne Woods appeals from the judgment of the Dallas Circuit Court dismissing his appeal from the Dallas District Court's judgment in his action against Federated Mutual Insurance Co. ("Federated") (appeal number 2070867) and from the judgment of the Dallas Circuit Court dismissing his action against Plumbing Contractors, LLC ("Plumbing Contractors"), and Timothy M. Sims (appeal number 2070872). This court consolidated Woods's appeals. For the reasons stated herein, we dismiss the former appeal, and we affirm the circuit court's judgment challenged in the latter appeal.
On March 10, 2006, Federated, as subrogee of Plumbing Contractors, sued Woods in the Dallas District Court. It alleged that Woods had damaged a truck owned by Plumbing Contractors, Federated's insured, in an automobile accident on September 2, 2005. Federated claimed that it had paid $5,932.67 for the damage caused by Woods, and it claimed that amount from Woods as damages. After Woods did not answer the complaint, the district court entered a default judgment against Woods on July 14, 2006.
On May 31, 2007, Woods filed a motion to set aside the district court's default judgment. He argued that, at the time of the application for default, Federated knew that he was represented by counsel and that he disputed Federated's claim. He argued that the default judgment was due to be set aside on the basis of "mistake, inadvertence, surprise or excusable neglect," and he asserted that he had a meritorious defense to Federated's action. He also filed a claim of exemption from garnishment.
Also on May 31, 2007, Woods filed a complaint in the Dallas Circuit Court against Plumbing Contractors and Timothy Sims ("the circuit-court action"). He alleged that Sims, in the line and scope of his duties as an employee of Plumbing Contractors, had negligently and wantonly caused the automobile accident that was the basis of Federated's district-court action and that Plumbing Contractors had negligently hired, trained, and supervised Sims. Woods sought a judgment in the amount of $50,000 for his alleged pain and suffering, mental anguish, emotional distress, and medical expenses, as well as punitive damages. Woods's action was assigned case number CV-07-132.
The district court held a hearing on July 24, 2007, on Woods's motion to set aside the default judgment and on his claim of exemption from garnishment. On August 3, 2007, the district court wrote on the case-action summary that Rule 60(b), Ala. R. Civ. P., requires that the grounds set out in Woods's motion be raised within four months of the entry of the judgment. Because they were not, the court wrote, Woods's motion was denied. A stamp on the case-action summary indicated that the district court's order was filed in the clerk's office on August 9, 2007. The State Judicial Information System ("SJIS") report from the district-court action reflected that an order was entered on August 13, 2007, denying Woods's claim for an exemption from garnishment. The SJIS report did not reflect the trial court's denial of Woods's motion to set aside the default judgment.
On August 15, 2007, Plumbing Contractors filed a motion to dismiss the circuit-court action. It argued that the district court's judgment in Federated's district-court action barred the circuit-court action under the doctrine of res judicata. It argued in the alternative that the circuit-court action was barred because the claims Woods asserted therein were required to have been brought as compulsory counterclaims in Federated's district-court action.
*704 On August 23, 2007, Woods filed a notice of appeal to the Dallas Circuit Court from the district court's denial of his motion to set aside the default judgment. That case was assigned case number CV-07-181. (Woods's appeal of the district-court judgment to the circuit court is hereinafter referred to as "the district-court appeal.")
On September 24, 2007, Federated filed a motion to dismiss the district-court appeal. It asserted, among other things, that Woods had failed to timely file his notice of appeal of the district court's denial of his motion to set aside the default judgment. See § 12-12-70, Ala.Code 1975. As a result, it argued, the notice of appeal was untimely and the circuit court lacked jurisdiction over Woods's appeal. On October 9, 2007, Woods filed a motion to consolidate the circuit-court action with the district-court appeal. The circuit court denied that motion on October 22, 2007.
On November 13, 2007, the circuit court dismissed the district-court appeal on the basis that Woods had not timely filed his appeal of the district court's order denying his motion to set aside the default judgment.
On November 26, 2007, Sims and Plumbing Contractors filed a supplement in support of the pending motion to dismiss the circuit-court action. They argued that the circuit court's dismissal of the district-court appeal meant that the district court's judgment remained a valid judgment and continued to bar the circuit-court action under the doctrine of res judicata.
Also on November 26, 2007, Woods filed a motion to vacate the dismissal of the district-court appeal and to set aside the district court's default judgment. He argued that he was not served with the summons and/or the complaint in the district-court action. Thus, he contended, the district court never obtained jurisdiction over him and, as a result, its default judgment in favor of Federated was void. On December 6, 2007, Woods filed a response to Sims and Plumbing Contractors' motion to dismiss the circuit-court action in which he argued that the judgment in the district-court action was void for lack of jurisdiction and that, because it was a default judgment, it could not serve as a basis for barring the circuit-court action under the doctrine of res judicata.
On January 16, 2008, the circuit court granted the motion to dismiss the circuit-court action and denied Woods's motion to vacate its order dismissing the district-court appeal. On February 12, 2008, Woods filed a document that he styled a "renewed motion to vacate order of dismissal and to set aside default judgment." The document bore the case numbers of both actions. In that motion, Woods argued that the district court's order denying his motion to set aside the default judgment was not entered, under Rule 58, Ala. R. Civ. P., until August 13, 2007, which, according to him, was the date on which the order was entered into the SJIS.[1] Because there is a 14-day deadline by which to file an appeal to the circuit court following the entry of an adverse judgment by the district court, see § 12-12-70, Ala.Code 1975, he argued that his August 23, 2007, appeal of that order to the circuit court was timely filed. Woods's February 12, 2008, motion, to the extent that it was a properly filed postjudgment motion under Rule 59(e), Ala. R. Civ. P., was denied by operation of law on May 12, *705 2008. See Rule 59.1, Ala. R. Civ. P. (If a trial court fails to dispose of a postjudgment motion filed pursuant to Rule 59(e) within 90 days of the date on which it is filed, the motion is denied by operation of law.). On June 19, 2008, Woods appealed the dismissals of both the circuit-court action and the district-court appeal to this court.
Woods contends that the circuit court erred when it dismissed both of the actions. He argues that his notice of appeal from the district court's denial of his motion to set aside the default judgment was filed in a timely manner. Before reaching the merits of this contention, however, we turn first to the question whether this court has jurisdiction to entertain Woods's appeals.[2] Our review of the record indicates that, although we have jurisdiction to consider the appeal from the circuit-court action, we do not have jurisdiction to consider the appeal from the district-court appeal.
As previously noted, the circuit court dismissed the district-court appeal on November 13, 2007. That dismissal constituted a final judgment in that case because it was "`a terminative decision by a court of competent jurisdiction which demonstrate[d] there ha[d] been complete adjudication of all matters in controversy between the litigants within the cognizance of that court.'" Coosa Valley Health Care v. Johnson, 961 So.2d 903, 905 (Ala.Civ. App.2007) (quoting Jewell v. Jackson & Whitsitt Cotton Co., 331 So.2d 623, 625 (Ala.1976)). Woods filed a postjudgment motion to vacate the judgment in that case on November 26, 2007. That motion, filed pursuant to Rule 59(e), Ala. R. Civ. P., tolled the time for taking an appeal from the circuit court's judgment of dismissal. See Rule 4(a)(3), Ala. R.App. P. The circuit court denied Woods's postjudgment motion on January 16, 2008. Woods had 42 days from that date, or until February 27, 2008, to file a notice of appeal in that action.[3] He did not file a notice of appeal until June 19, 2008. Because Woods's notice of appeal of the dismissal of the district-court appeal was filed more than 42 days after the denial of his postjudgment motion in that action, the notice was untimely and this court is left with no alternative but to dismiss his appeal of that action. See Parker v. Parker, 946 So.2d 480, 485 (Ala.Civ. App.2006) ("[A]n untimely filed notice of appeal results in a lack of appellate jurisdiction, which cannot be waived.").
We conclude that this court does, however, have jurisdiction over the appeal from the dismissal of the circuit-court action. The circuit court dismissed *706 that action on January 16, 2008. Woods's February 12, 2008, motion to vacate the dismissal of that action tolled the time for filing an appeal in that action. See Rule 4(a)(3), Ala. R.App. P. As previously noted, the February 12, 2008, motion to vacate the dismissal was denied by operation of law on May 12, 2008, the circuit court having failed to rule on it. See Rule 59.1, Ala. R. Civ. P. Woods filed his notice of appeal from the circuit court's dismissal of the circuit-court action on June 19, 2008, within 42 days from the denial of his postjudgment motion in that case. As a result, his appeal from the dismissal of the circuit-court action is timely.
We turn now to the merits of Woods's appeal from the dismissal of the circuit-court action. The basis for Sims and Plumbing Contractors' motion to dismiss the circuit-court action was that the district court's default judgment in favor of Federated and against Woods constituted a bar under the doctrine of res judicata to Woods's later action against them in the circuit court. In his principal brief, Woods has made no argument with regard to the doctrine of res judicata, the entire basis of Sims and Plumbing Contractors' motion to dismiss, nor has he cited to any legal authority bearing on the issue.
Rule 28(a)(10), Ala. R.App. P., requires an appellant to present arguments in its brief supported by adequate legal authority. Spradlin v. Spradlin, 601 So.2d 76, 79 (Ala.1992). It is not the duty of the appellate court to make arguments for the parties, nor is it the appellate court's duty to conduct the parties' legal research. See Dykes v. Lane Trucking, Inc., 652 So.2d 248, 251 (Ala.1994) ("[I]t is not the function of this Court to do a party's legal research or to make and address legal arguments for a party based on undelineated general propositions not supported by sufficient authority or argument."). Because Woods does not make an argument that is responsive to the basis of the circuit court's judgment and because he provides this court with no legal basis for reversing the circuit court's dismissal of his action against Plumbing Contractors and Sims, that judgment is due to be affirmed.
Based on the foregoing, we dismiss Woods's appeal from the district-court appeal, appeal number 2070867, and we affirm the circuit court's dismissal of the circuit-court action, appeal number 2070872.
2070867 APPEAL DISMISSED.
2070872 AFFIRMED.
PITTMAN, BRYAN, THOMAS, and MOORE, JJ., concur.
NOTES
[1] Rule 58(c), Ala. R. Civ. P., provides, in pertinent part, that "[a]n order or a judgment shall be deemed `entered' within the meaning of these Rules and the Rules of Appellate Procedure as of the actual date of the input of the order or judgment into the State Judicial Information System."
[2] Although none of the parties argues that this court is without jurisdiction over Woods's appeals, "`jurisdictional matters are of such magnitude that we take notice of them at any time and do so even ex mero motu.'" Wallace v. Tee Jays Mfg. Co., 689 So.2d 210, 211 (Ala.Civ.App.1997) (quoting Nunn v. Baker, 518 So.2d 711, 712 (Ala. 1987)).
[3] Woods's February 12, 2008, motion did not toll the time for filing a notice of appeal of the dismissal of the district-court appeal. After the first Rule 59(e) postjudgment motion is denied, subsequent motions filed pursuant to that rule do not toll the time for taking an appeal. See Durr v. Durr, 961 So.2d 139, 140 (Ala.Civ.App.2006) ("[I]t long has been held that `while a Rule 59 motion tolls the time for taking an appeal, a subsequent request, by whatever label, seeking the trial court's reconsideration of its ruling on the former Rule 59 motion, does not operate to further toll the time for the appeal.'" (quoting Sunshine Homes, Inc. v. Newton, 443 So.2d 921, 923 (Ala. 1983), rev'd on other grounds, Ex parte Mutual Sav. Life Ins. Co., 765 So.2d 649 (Ala. 1998))). Woods's "motion cannot be construed as one pursuant to Rule 60(b), Ala. R.App. P., because it did not allege any of the grounds for relief under that rule." Moss v. Mosley, 948 So.2d 560, 565 (Ala.Civ.App. 2006). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585427/ | 815 F.Supp. 844 (1993)
James F. COX
v.
MASTER LOCK CO.
Civ. A. No. 92-0287.
United States District Court, E.D. Pennsylvania.
March 23, 1993.
James F. Cox, Ambler, PA, pro se.
Marguerite S. Walsh, Philadelphia, PA, for defendant.
MEMORANDUM
WALDMAN, District Judge.
Plaintiff asserts a claim under the Age Discrimination in Employment Act ("ADEA"), alleging that defendant terminated his employment because of his age. Defendant has moved for summary judgment on the ground that plaintiff was not an "employee" of defendant and thus is not entitled to the relief sought as a matter of law.
I. LEGAL STANDARD
A motion for summary judgment requires the court to consider whether the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, show there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2509, 91 L.Ed.2d 202 (1986). Only facts that may affect the outcome of a case under applicable law are "material." "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Id. at 247-48, 106 S.Ct. at 2510.
All reasonable inferences from the record must be drawn in favor of the non-movant. Id. at 255, 106 S.Ct. at 2513. Although the movant has the initial burden of demonstrating an absence of genuine issues of material fact, the non-movant must then establish the existence of each element on which it bears the burden of proof. See J.F. Feeser, Inc. v. Serv-A-Portion, 909 F.2d 1524, 1531 (3d Cir. 1990), cert. denied, ___ U.S. ___, 111 S.Ct. *845 1313, 113 L.Ed.2d 246 (1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986)).
II. FACTS
The pertinent facts are uncontroverted or set forth in a light most favorable to plaintiff, and are as follow.
From 1972 until 1986, Mr. Cox worked as an "Independent Manufacturer's Representative" ("IMR") for Master Lock pursuant to a series of written agreements executed by Master Lock and Jimcox, Inc., an entity incorporated by plaintiff. Pursuant to the agreements, Mr. Cox was authorized to sell defendant's products in a territory encompassing northeastern Pennsylvania and portions of Philadelphia. The agreement in effect in August 1986 had been executed on March 1, 1985. Mr. Cox maintained and worked out of an office in Glenside and then Ambler, Pa. The defendant corporation manufactures locks and is headquartered in Milwaukee.
Either party had a right to terminate the IMR agreement by written notice to the other at any time and for any reason. The agreement provided that the sole basis of compensation was commissions on sales. Plaintiff assumed responsibility for payment of travel, insurance, office, equipment, supply and any other expenses which were incurred by him in the performance of the contract. Jimcox, Inc. had full responsibility for the withholding and payment of social security and income taxes for plaintiff. Jimcox was given discretion to conduct its business in "such manner as it sees fit."
Jimcox was not allowed to sell products manufactured by defendant's competitors or to sell at prices other than those set by Master Lock. Master Lock had the right to accept or reject any orders placed with plaintiff. Plaintiff was required to submit sales and marketing reports to defendant.[1]
Mr. Cox was not required to report physically to defendant at any time but was required to maintain telephone contact. He set his own work hours and vacation times, and received no pension or insurance benefits from defendant. Mr. Cox received no sales training or performance reviews from Master Lock. On two occasions between May and August of 1986, he was visited by defendant's regional sales manager who accompanied and observed plaintiff while he made several sales calls. When asked at his deposition if it was true that his sales efforts were not supervised by Master Lock, plaintiff testified "That's correct."
The agreement specified that Jimcox had "no authority to act on behalf of the Company as an agent or otherwise, and neither it nor its employees shall represent itself or themselves as agents or employees of the Company."
On August 26, 1986, Master Lock notified plaintiff in writing that it was terminating the IMR agreement as of September 1, 1986.[2] Mr. Cox was 62 years-old at the time.
III. DISCUSSION
The ADEA protects only persons who are "employees." E.E.O.C. v. Zippo Mfg. Co., 713 F.2d 32, 33 (3d Cir.1983). Whether a plaintiff is an "employee" for purposes of ADEA is a question of law to be determined by the court in the absence of disputed material underlying facts. See Golden v. A.P. Orleans, Inc., 681 F.Supp. 1100, 1102 n. 2 (E.D.Pa.1988).
The statute does not meaningfully define the term "employee." It simply provides that an "employee" is "an individual employed by any employer." See 29 U.S.C. § 630(f).
The Third Circuit has adopted a so-called "hybrid test," combining the traditional test for common-law agency with modern economic realities, for determining whether a *846 person is an employee or independent contractor for purposes of ADEA. Zippo, 713 F.2d at 38. More recently, however, the U.S. Supreme Court in Nationwide Mut. Ins. Co. v. Darden, ___ U.S. ___, 112 S.Ct. 1344, 117 L.Ed.2d 581 (1992), an ERISA case, articulated a general rule of utilizing the common-law agency standard to define the meaning of "employee" in statutes in which Congress has not otherwise helpfully defined the term. Id. at ___, 112 S.Ct. at 1348-49 (abandoning standard of United States v. Silk, 331 U.S. 704, 713, 67 S.Ct. 1463, 1468, 91 L.Ed. 1757 (1947) of construing "employee" "in the light of the mischief to be corrected and the end to be attained" from which hybrid test derives). See also Frankel v. Bally, Inc., 987 F.2d 86 (2d Cir. 1993) (Darden mandates application of common-law agency test in ADEA cases).
The court believes that Darden requires the application of the common-law agency test rather than a hybrid test in determining whether someone is an employee for purposes of ADEA. Under either test, however, the result in this case would be the same. Most of the twelve factors utilized by the Third Circuit in its hybrid test reflect common-law agency principles and both tests "place the greatest emphasis on the hiring party's right to control the manner and means by which the work is accomplished." Id. at 90; Zippo, 713 F.2d at 37. Applying either test, the plaintiff is not an employee for purposes of ADEA. Indeed, the facts of this case, construed most favorably to plaintiff, are quite similar to those in Zippo, in which the Third Circuit, applying the hybrid test, affirmed a grant of summary judgment on the ground that the plaintiffs were independent contractors.
The pertinent factors in the common-law agency test are:
1) the alleged employer's right to control the manner and means of the employment;
2) the skill required;
3) the source of the instrumentalities and tools;
4) the location of the work;
5) the duration of the relationship between the parties;
6) whether the hiring party has the right to assign additional projects;
7) the hired party's discretion over hours;
8) the method of payment;
9) the hired party's role in hiring and paying assistants;
10) whether the work is part of the regular business of the hiring party;
11) whether the hiring party is in business;
12) the provision of employee benefits; and,
13) the hired party's tax treatment.
Community for Creative Non-Violence v. Reid, 490 U.S. 730, 751-52, 109 S.Ct. 2166, 2178-79, 104 L.Ed.2d 811 (1989).
As noted, the most important factor in the hybrid test is "the extent of the employer's right to control the `means and manner' of the worker's performance." See Zippo, 713 F.2d at 37 (quoting Spirides v. Reinhardt, 613 F.2d 826, 831 (D.C.Cir.1979)). The other pertinent factors are:
(1) the kind of occupation, with reference to whether the work usually is done under the direction of a supervisor or is done by a specialist without supervision; (2) the skill required in the particular occupation; (3) whether the `employer' or the individual in question furnishes the equipment used and the place of work; (4) the length of time during which the individual has worked; (5) the method of payment, whether by time or by the job; (6) the manner in which the work relationship is terminated; i.e., by one or both parties, with or without notice and explanation; (7) whether annual leave is afforded; (8) whether the work is an integral part of the business of the `employer'; (9) whether the worker accumulates retirement benefits; (10) whether the `employer' pays social security taxes; and (11) the intention of the parties.
Id.
Defendant exercised virtually no control over the "means and manner" of plaintiff's sales practices. Plaintiff had the independence to establish his own business organization and indeed operated through an entity *847 which he incorporated. Although he provided Master Lock with a summary of his sales contacts, Mr. Cox was free to set his own hours and vacation times. Mr. Cox had a contractual right to conduct his business "in such manner as [he] sees fit."
Plaintiff provided his own supplies, equipment, place of business and insurance. He was paid solely by commission and he paid for all travel and other expenses incurred in his sales efforts. Plaintiff received no annual leave or retirement benefits. He was responsible for paying his own income and social security taxes.
Plaintiff's work was an important part of defendant's business, however, contract exclusions for government business and designated house accounts make clear that defendant used IMR's to supplement other direct sales. The parties had maintained a relationship for fourteen years, however, they expressly agreed that plaintiff was not and was not to represent himself as an agent or employee of defendant. Either party had the right to terminate their agreement at any time and for any reason. See Zippo, 713 F.2d at 38.
Whichever test one utilizes, the pertinent factors militate heavily against a finding of employment. The court is compelled to conclude from the record adduced that plaintiff was an independent contractor and was not covered by ADEA. Accordingly, defendant's motion will be granted.
NOTES
[1] In his brief, plaintiff states that he was required to submit monthly "Territorial Marketing Plans" and forecasts. In his deposition, however, he testified that these Plans were submitted annually.
[2] Defendant states that it terminated the agreement because plaintiff was not fulfilling his obligations and was the subject of customer complaints. Plaintiff states that his performance was "excellent." In deciding this motion, the court will assume that plaintiff was performing his work capably. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581702/ | 42 So.3d 234 (2010)
KOENEMUND
v.
STATE.
No. SC10-844.
Supreme Court of Florida.
July 9, 2010.
Decision Without Published Opinion Review dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581846/ | 31 So.3d 175 (2008)
EX PARTE TIM HENRY JOINER.
No. 1071053 (CR-06-1975).
Supreme Court of Alabama.
June 13, 2008.
Decision of the Supreme Court of Alabama Without Opinion Cert. denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581728/ | 42 So.3d 451 (2010)
STATE of Louisiana, Appellee
v.
Zephan T. GIVENS, Appellant.
No. 45,354-KA.
Court of Appeal of Louisiana, Second Circuit.
June 23, 2010.
*452 Louisiana Appellate Project, by Paula Corley Marx, for Appellant.
Jerry L. Jones, District Attorney, George Daniel Ross, Ellen R. Eade, Assistant District Attorneys, for Appellee.
Before CARAWAY, DREW and MOORE, JJ.
DREW, J.
Zephan T. Givens killed Demetriac Trent by shooting him in the head with a pistol. Givens was initially indicted for first degree murder, then a superseding indictment charged him with second degree murder. He pled guilty to the crime of manslaughter (La. R.S. 14:31), with an agreement that the state would not prosecute him as a habitual offender. With thoughtful and thorough reasons, the trial court sentenced him to the maximum sentence of 40 years at hard labor. A timely motion for reconsideration of sentence was denied.
He now appeals his sentence. We affirm.
FACTS
A Monroe Police Department officer was dispatched to the home of Demetriac Trent on November 30, 2004, on a welfare concern call initiated by a friend. Officers arriving on the scene entered the home and found Trent's lifeless body, with a gunshot wound to his head. EMTs found no signs of life.
Detectives assigned to the case learned that the victim's cars were missing and issued alerts for the vehicles. One vehicle was found at a repair shop and the other was discovered at a vacant residence.
In speaking with one of the victim's friends, detectives learned that the victim was homosexual but was very secretive about his sexual preference. According to the friend, the victim preferred young black males who were "thugs" and did not appear to be homosexual. No solid leads were uncovered.
Almost one year later, on September 20, 2005, this defendant was incarcerated for an unrelated crime of armed robbery. A fellow inmate wanting assistance on a DUI charge was his cellmate. Defendant told the informant that he shot the victim because of his unwanted sexual advances, and that the gun used in the armed robbery was the same one used to kill Trent. This fact was eventually confirmed by firearms identification testing.
Detectives interviewed the defendant's brothers (Quentin and Aquila).
Quentin revealed that the victim was homosexual and his brother confessed to committing the crime and acting alone.
Aquila stated that:
the defendant admitted shooting the victim over a misunderstanding related to money and/or an alternate sexual lifestyle;
his brother had been embarrassed by the victim at the defendant's workplace when the victim made remarks that led people to believe the defendant was involved in homosexual activity;
the defendant was alone in the house with the victim while Quentin and his girlfriend waited outside in the girlfriend's vehicle;
*453 he (Quentin) went inside the house after hearing a shot fired; and
he and the defendant took the victim's vehicle, rode around for awhile, and abandoned it, fearing that the shooting had been discovered.
The defendant confessed to the shooting, indicating it was in self-defense. He further stated that:
the victim had angered him by publicly making sexual comments to him;
the victim made sexual advances toward him;
he feared for his manhood and his safety;
he pulled a revolver from his pants and fired one shot at the victim;
he took the victim's vehicle and rode to Quentin's residence, where Quentin and his girlfriend joined him; and
they disposed of the vehicle.
The theory of the crime, as determined by detectives, is that:
the victim was home alone, preparing for work, when the defendant arrived;
a pornographic movie was placed in the DVD player;
the defendant initially watched the movie, then moved to the kitchen;
the victim was kneeling execution style, when shot near the eye;
Quentin accompanied the defendant to take part in a planned robbery; and
after the shot, he helped remove his brother's fingerprints from the home.
DISCUSSION
The defendant argues that:
his sentence is excessive in that he is a youthful first felony offender;
there were questions of fact and law which led to the manslaughter plea;
he is a good candidate for rehabilitation; and
he accepts responsibility for the crime and wants to make amends.
The state counters that the defendant has not shown the potential for rehabilitation but has proven to be a very violent person and a serious danger to society, well deserving of a maximum sentence.
Our law on reviewing the excessiveness of sentences is well settled.[1]
*454 The record reveals that the trial court duly considered the appropriate factors in determining defendant's sentence. The court was familiar with the presentence investigation (PSI), which included a victim's impact statement and defendant's social and criminal history. The trial court found that:
the 24-year-old defendant, considered a first felony offender, committed a second violent crime (armed robbery) shortly after the instant crime;
the senseless crime caused great hardship to the victim's family;
the defendant's version of events was not believable;
the defendant substantially benefited from the plea bargain;
the defendant would likely commit another crime; and
a lesser sentence would deprecate the seriousness of the crime.
During the sentencing hearing, the victim's oldest sister indicated that:
the victim's mother was hospitalized at the time of her son's death;
after the mother learned of the killing, she never spoke again;
the victim was part of a close-knit family and was much missed;
the family requested that the court take the family's pain and suffering under consideration when determining the defendant's sentence.
In an impact statement provided to the probation and parole officer who prepared the PSI, the victim's brother also discussed the impact the crime had on the victim's mother and asked that the family receive justice.
We find no error in the sentence. This defendant has a propensity for violent crimes. The crime of manslaughter does *455 not adequately describe his conduct in violently executing this victim. Accordingly, imposition of the maximum sentence was within the court's discretion. We have upheld maximum sentences in similar situations.[2]
This sentence is neither grossly out of proportion to the seriousness of the offense, nor a needless infliction of pain, nor is it shocking to the conscience.
DECREE
The defendant's conviction and sentence are AFFIRMED.
NOTES
[1] The test imposed by the reviewing court in determining the excessiveness of a sentence is two-pronged. First, the record must show that the trial court took cognizance of the criteria set forth in La. C. Cr. P. art. 894.1. The trial judge is not required to list every aggravating or mitigating circumstance so long as the record reflects that he adequately considered the guidelines of the article. State v. Smith, 433 So.2d 688 (La. 1983); State v. Lathan, 41,855 (La.App.2d Cir.2/28/07), 953 So.2d 890, writ denied, XXXX-XXXX (La.3/28/08), 978 So.2d 297. The articulation of the factual basis for a sentence is the goal of La. C. Cr. P. art. 894.1, not rigid or mechanical compliance with its provisions. Where the record clearly shows an adequate factual basis for the sentence imposed, remand is unnecessary even where there has not been full compliance with La. C. Cr. P. art. 894.1. State v. Lanclos, 419 So.2d 475 (La. 1982); State v. Swayzer, 43,350 (La. App.2d Cir.8/13/08), 989 So.2d 267; writ denied, 2008-2697 (La.9/18/09), 17 So.3d 388. The important elements which should be considered are the defendant's personal history (age, family ties, marital status, health, employment record), prior criminal record, seriousness of offense and the likelihood of rehabilitation. State v. Jones, 398 So.2d 1049 (La. 1981); State v. Ates, 43,327 (La.App.2d Cir.8/13/08), 989 So.2d 259, writ denied, 2008-2341 (La.5/15/09), 8 So.3d 581. There is no requirement that specific matters be given any particular weight at sentencing. State v. Shumaker, 41,547 (La.App.2d Cir. 12/13/06), 945 So.2d 277, writ denied, XXXX-XXXX (La.9/28/07), 964 So.2d 351.
A trial court has broad discretion to sentence within the statutory limits. Where a defendant has pled guilty to an offense which does not adequately describe his conduct or has received a significant reduction in potential exposure to confinement through a plea bargain, the trial court has great discretion in imposing even the maximum sentence possible for the pled offense. State v. Germany, 43,239 (La.App.2d Cir.4/30/08), 981 So.2d 792, State v. Black, 28,100 (La.App.2d Cir.2/28/96), 669 So.2d 667, writ denied, 96-0836 (La.9/20/96), 679 So.2d 430. Absent a showing of manifest abuse of that discretion we may not set aside a sentence as excessive. State v. Guzman, 99-1528, 99-1753 (La.5/16/00), 769 So.2d 1158; State v. June, 38,440 (La.App.2d Cir.5/12/04), 873 So.2d 939; State v. Lingefelt, 38,038 (La.App.2d Cir. 1/28/04), 865 So.2d 280, writ denied, XXXX-XXXX (La.9/24/04), 882 So.2d 1165.
On the second prong of the excessiveness test, the court must determine whether a sentence violates La. Const. art. I, § 20. A sentence violates La. Const. Art. I, § 20, if it is grossly out of proportion to the seriousness of the offense or nothing more than a purposeless and needless infliction of pain and suffering. State v. Smith, 2001-2574 (La.1/14/03), 839 So.2d 1; State v. Dorthey, 623 So.2d 1276 (La.1993); State v. Bonanno, 384 So.2d 355 (La. 1980). A sentence is considered grossly disproportionate if, when the crime and punishment are viewed in light of the harm done to society, it shocks the sense of justice. State v. Weaver, XXXX-XXXX (La. 1/15/02), 805 So.2d 166; State v. Lobato, 603 So.2d 739 (La. 1992); State v. Robinson, 40,983 (La.App.2d Cir. 1/24/07), 948 So.2d 379; State v. Bradford, 29,519 (La.App.2d Cir.4/2/97), 691 So.2d 864.
As a general rule, maximum or near maximum sentences are reserved for the worst offenders and the worst offenses. State v. Cozzetto, 2007-2031 (La.2/15/08), 974 So.2d 665; State v. McKinney, 43,061 (La.App.2d Cir.2/13/08), 976 So.2d 802; State v. Woods, 41,420 (La.App.2d Cir.11/1/06), 942 So.2d 658, writs denied, 2006-2768, 2006-2781, (La.6/22/07), 959 So.2d 494. However, in cases where the defendant has pled guilty to an offense which does not adequately describe his conduct, the general rule does not apply and the trial court has great discretion in imposing the maximum sentence possible for the pled offense. This is particularly true in cases where a significant reduction in potential exposure to confinement has been obtained through a plea bargain and the offense involves violence upon a victim. State v. Black, 28,100 (La.App.2d Cir.2/28/96), 669 So.2d 667, writ denied, 96-0836 (La.9/20/96), 679 So.2d 430.
[2] In State v. Jones, 41,628 (La.App.2d Cir. 1/24/07), 948 So.2d 356, the defendant received a maximum sentence for manslaughter, a crime which we held did not adequately describe the defendant's conduct in killing the victim then later attempting to cover up the crime.
In State v. Hudson, 33,357 (La.App.2d Cir.5/10/00), 760 So.2d 591, a 25-year-old man was given 40 years for killing a male acquaintance who made a sexual overture to him. He had no prior criminal history. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581732/ | 957 F.Supp. 122 (1997)
Robert E. GERBEC and Elizabeth W. Gerbec, Plaintiffs,
v.
UNITED STATES of America, Defendant.
Raymond E. MORGAN and Jennifer L. Morgan, Plaintiffs,
v.
UNITED STATES of America, Defendant.
Nos. C2-95-1263, C2-95-1264.
United States District Court, S.D. Ohio, Eastern Division.
January 9, 1997.
*123 Richard Adams Cordray, Grove City, OH, Stephen L. Hester, Washington, DC, for Plaintiffs.
Brenda L. Dodrill, U.S. Attorney's Office, Columbus, OH, Michael W. Davis, U.S. Dept. of Justice, Washington, DC, for Defendants.
OPINION AND ORDER
GRAHAM, District Judge.
Plaintiffs Robert E. Gerbec and Raymond E. Morgan are both former employees of Continental Can Company, Inc. ("Continental") who were wrongfully discharged as part of an illegal scheme to reduce pension liabilities. Here, they are seeking refunds of federal income taxes and FICA taxes paid on amounts they received in settlement of a class action lawsuit against Continental. See McLendon v. Continental Group, Inc., 749 F.Supp. 582 (D.N.J.1989), aff'd sub nom McLendon v. Continental Can Co., 908 F.2d 1171 (3d Cir.1990); Gavalik v. Continental Can Co., 812 F.2d 834 (3d Cir.1987), cert. denied, 484 U.S. 979, 108 S.Ct. 495, 98 L.Ed.2d 492 (1987), and McLendon v. Continental Group, Inc., 802 F.Supp. 1216 (D.N.J. 1992) (hereinafter referred to as the "McLendon/Gavalik" litigation.)
The McLendon/Gavalik plaintiffs asserted claims under § 510 of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1140. In December 1990, Continental settled their claims for the total sum of four hundred and fifteen million dollars. In 1992, the settlement fund was distributed to members of the class according to a formula devised by a special master appointed by the trial court. Gerbec received a total pre-tax award of $60,065.00 from the McLendon/Gavalik settlement fund, and Morgan received $94,410. Federal income taxes and FICA taxes were withheld from these amounts.
Section 61(a) of the Internal Revenue Code defines gross income broadly as "all income from whatever source derived" not expressly excluded by the Code. 26 U.S.C. § 61(a). Courts give effect to that broad definition by interpreting the statutory exclusions from gross income narrowly. U.S. v. Burke, 504 U.S. 229, 112 S.Ct. 1867, 119 L.Ed.2d 34 (1992).
Section 104(a)(2) of the Internal Revenue Code, 26 U.S.C. § 104(a)(2) (1988), excludes from gross income "the amount of any damages received (whether by suit or agreement and whether as lump sums or as periodic payments) on account of personal injuries or sickness." Treasury Regulation 26 C.F.R. § 1.104-1(c) (1994) provides that the exclusion encompasses "an amount received ... through prosecution of a legal suit or action based upon tort or tort type rights, or through a settlement agreement entered into in lieu of such prosecution." The issue presented in this tax refund litigation is whether the money received by Gerbec and Morgan as a result of the settlement of the McLendon/Gavalik litigation represented damages received on account of personal injuries.
When the McLendon/Gavalik cases were settled, it was unclear what damages were recoverable for a violation of ERISA § 510, i.e. whether ERISA provided only equitable rights and remedies or whether it also provided tort type rights such as compensatory and punitive damages. The Supreme Court of the United States resolved the matter in 1993, holding that relief under ERISA § 502(a), 29 U.S.C. § 1132(a) was limited to traditional notions of equitable relief and did not encompass compensatory and punitive damages. Mertens v. Hewitt Assocs., 508 U.S. 248, 256-57, 113 S.Ct. 2063, 2069, 124 L.Ed.2d 161 (1993). Nevertheless, it is clear from the record that the special master in the McLendon/Gavalik cases intended to award members of the plaintiff class damages for non-pecuniary losses including impairment of earnings ability, mental anguish, emotional distress, and dignitary loss when the settlement funds were distributed in 1992.
Plaintiffs assert that they are entitled to the benefit of § 104(a)(2) of the Internal Revenue Code because the monies they received from the settlement fund represent damages on account of personal injuries from *124 claims based on tort type rights. The government contends, on the other hand, that it is impossible for plaintiffs to satisfy the requirements of § 104(a)(2), because the Supreme Court has held that tort type damages are not recoverable under § 502 of ERISA. According to the government, it matters not what the plaintiffs or the special master may have intended when the McLendon/Gavalik litigation was settled because ERISA damages are limited to equitable relief under the 1993 Supreme Court decision in Mertens. This Court is persuaded that the government's position is correct.
The Supreme Court has held that in order to qualify for the exclusion provided in § 104(a)(2), a taxpayer must establish two independent elements:
In sum, the plain language of § 104(a)(2), the test of the applicable regulation, and our decision in Burke establish two independent requirements that a taxpayer must meet before a recovery may be excluded under § 104(a)(2). First, the taxpayer must demonstrate that the underlying cause of action giving rise to the recovery is "based upon tort or tort type rights"; and second, the taxpayer must show that the damages were received "on account of personal injuries or sickness."
Commissioner v. Schleier, ___ U.S. ___, ___ - ___, 115 S.Ct. 2159, 2166-67, 132 L.Ed.2d 294 (1995). A cause of action is based upon tort or tort type rights only if it creates a remedy for a personal injury. Schleier, ___ U.S. at ___ - ___, 115 S.Ct. at 2166-67; United States v. Burke, 504 U.S. 229, 237 n. 7, 112 S.Ct. 1867, 1872 n. 7, 119 L.Ed.2d 34. (1992) A claim that permits only equitable relief does not pass this test. Schleier, ___ U.S. at ___ - ___, 115 S.Ct. at 2166-67; Burke, 504 U.S. at 238-39, 112 S.Ct. at 1872-73. Since the Supreme Court held in Mertens that a claim based on ERISA § 502 is not based upon tort or tort type rights, it follows that the plaintiffs cannot satisfy the first prong of the Schleier test. Their ERISA claims which produced the settlement fund were not based on tort type rights.
The issue of the taxability of the proceeds of the settlement of the McLendon/Gavalik litigation was decided in favor of the plaintiffs in a split decision of a panel of the Fifth Circuit Court of Appeals in Dotson v. United States, 87 F.3d 682 (5th Cir.1996). This Court respectfully disagrees with the reasoning of the majority in Dotson and finds the logic of Judge Smith's dissenting opinion more compelling.
Judge Smith correctly stated the law in Dotson when he said, 87 F.3d at 691:
Moreover, as the Supreme Court is the authoritative interpreter of federal law, earlier lower-court opinions reaching a different conclusion are "wrong." Id. (footnote omitted) Thus, Mertens holds that ERISA never provided compensatory remedies, and lower courts were in error to believe otherwise.
The plaintiffs may have hoped that their settlement would be treated as personal injury damages but the subsequent decision of the Supreme Court in Mertens doomed that hope.
In reaching this conclusion, this Court has not reopened, reexamined or relitigated any issue actually determined in the McLendon/Gavalik litigation. The issue of whether damages for personal injury were recoverable under ERISA was not actually and necessarily determined there, nor was the issue of the taxability of the proceeds of the settlement of an ERISA action determined there. Any agreements which the parties may have reached in settling the McLendon/Gavalik litigation would not be binding upon the government since it was not a party to those agreements. Likewise, the findings of the special master and the findings of district court when it authorized the distribution of the settlement fund did not bind the government since it was not a party to the litigation.
The majority in Dotson relied heavily on the interest of finality and predictability of taxation but it is difficult to see how the majority decision advances that interest when it gives rise to fact intensive inquiries as to the subjective intent of the litigants. As Judge Smith pointed out in his dissent, the rule advocated by the majority provides an incentive for the creation of a distorted paper trail purporting to show a good faith *125 belief in the availability of non-existent remedies. 87 F.3d at 693. The interests of finality, predictability and consistency are best served by adhering to the well-settled principle that rulings of the Supreme Court of the United States must be given full effect as to all cases still open and as to all events, regardless of whether such events predate or post-date the announcement of the rule. Harper v. Virginia Department of Taxation, 509 U.S. 86, 97, 113 S.Ct. 2510, 2517-18, 125 L.Ed.2d 74 (1993).
Gerbec and Morgan both concede that they did not sustain any actual damages which would have entitled them to any form of traditional equitable relief, such as restitution or back pay. This Court concludes, as did Judge Smith in his dissent in Dotson, that the settlement they received was "simply a windfall, like lottery winnings or punitive damages, unrelated to any legally-protected personal injury." Dotson, 87 F.3d at 695. Like any other windfall, it is wholly subject to income taxes.
Plaintiffs seek a refund of employment taxes paid on the distributions they received from the McLendon/Gavalik litigation under the Federal Income Contributions Act ("FICA") 26 U.S.C. § 3101 et seq., arguing that the settlement was not "wages" subject to tax under 26 U.S.C. § 3121(a), which defines wages as "all remuneration for employment". The term "employment" is defined in 26 U.S.C. § 3121(b) as "any service, of whatever nature ... performed by an employee for the person employing him". The term "wages" is narrower than the term "income", wages being merely one form of income. Royster Co. v. United States, 479 F.2d 387, 390 (4th Cir.1973). The issue regarding FICA taxes then is whether the settlement received by the plaintiffs constitutes income which is "remuneration for employment". The court finds that it does not. Plaintiffs had already received full payment for the services they performed for Continental; thus, the settlement could not represent wages or remuneration for employment. See Milligan v. Commissioner, 38 F.3d 1094, 1099 (9th Cir.1994) (termination payments did not derive from prior business activity within the meaning of self-employment tax). Plaintiffs are entitled to a refund of the overpaid FICA taxes.
Accordingly, the government's motion for summary judgment is granted in part and the plaintiffs' motions for summary judgment are granted in part. The Clerk shall enter final judgment in favor of defendant United States of America dismissing plaintiffs' claims for refund of withheld income taxes, and the Clerk shall enter final judgment in favor of the plaintiffs, Raymond E. Morgan and Jennifer Morgan, for overpaid FICA taxes in the amount of $1,817.21, and in favor of the plaintiffs, Robert E. Gerbec and Elizabeth W. Gerbec, for overpaid FICA taxes in the amount of $1,389.89.
It is so ORDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581775/ | 628 N.W.2d 292 (2001)
10 Neb. Ct. App. 224
Linda J. BERTCH, Appellee,
v.
Gregory SHELLY and Jack Shelly, Appellants.
No. A-00-268.
Court of Appeals of Nebraska.
May 29, 2001.
*293 Thomas H. Cellilli III and Matthew D. Hammes, of Locher, Cellilli, Pavelka & Dostal, L.L.C., Omaha, for appellants.
Robert E. O'Connor, Jr., Omaha, for appellee.
HANNON, CARLSON, and MOORE, JJ.
CARLSON, Judge.
INTRODUCTION
In this motor vehicle accident case, Gregory Shelly and Jack Shelly (defendants) appeal from an order of the district court for Douglas County granting Linda J. Bertch's motion for new trial. The defendants also appeal the district court's overruling of their motions for a directed verdict at trial. For the reasons set forth below, we affirm.
BACKGROUND
On October 7, 1997, Bertch filed an amended petition against the defendants alleging that on July 26, 1994, Gregory, while operating a vehicle owned by his father, Jack, rear-ended her vehicle at approximately 72nd and Maple Streets in Omaha. Bertch alleged that as a direct and proximate result of the accident, she sustained permanent injury to her head, neck, back, and shoulder. Bertch alleged that she had incurred medical expenses in the amount of $1,615.74 and that her vehicle sustained damage in the amount of $310.75.
In an amended answer, the defendants admitted that the vehicle Gregory was operating made contact with Bertch's vehicle, but denied that this contact caused injury to Bertch.
Trial was held on November 22 and 23, 1999. The evidence produced at trial showed that Bertch was involved in two motor vehicle accidents in the summer of 1994. The first accident occurred on June 13, 1994, and the second, which is the *294 subject of the instant case, occurred on July 26, 1994.
Bertch testified that after her vehicle was rear-ended in the June 13, 1994, accident, she had pain in her neck and in her back and that she began to get headaches. The record shows that after the first accident, Bertch went to physical therapy for a short time, but stopped going around July 12 because it made her feel worse. Bertch testified that between July 12 and July 26, the date of her second accident, she began to feel better.
Bertch testified that after the July 26, 1994, accident, she had pain in her neck and in her chest. Bertch also testified that after the second accident, her headaches became more severe and more intense to the point of making her nauseous. Bertch testified that by March 1995, her "neck was fine," but that she continued to have headaches two or three times a week. Bertch testified that in November 1996, she began to experience severe dizzy spells, along with her continued headaches.
The record shows that eventually, Bertch was referred to Dr. Britt Thedinger, an otologist-neurotologist who specializes in disorders of the ear, hearing, balance, and facial nerve disorders. Thedinger testified that Bertch had suffered a closed head injury, leading to episodes of vertigo, dizziness, and headaches. Thedinger testified with a reasonable degree of certainty that Bertch's condition was caused by the car accidents Bertch was involved in in June and July 1994.
At the close of Bertch's case in chief, the defendants moved for a directed verdict on the issue of causation. The defendants contended that Bertch had failed to produce any evidence that the July 26, 1994, accident was the proximate cause of her injuries. The trial court overruled this motion, and the defendants renewed their motion for a directed verdict at the close of all of the evidence. The trial court again overruled the defendants' motion.
Regarding Bertch's prior accident and Bertch's preexisting injuries, the trial court specifically instructed the jury in jury instruction No. 5: "There is evidence that the Plaintiff had a car accident prior to this one. The Defendants are liable only for any damages that you find to be proximately caused by this accident." The trial court failed to give Bertch's proposed jury instruction, based on NJI2d Civ. 4.09, which stated:
There is evidence that the Plaintiff Linda Bertch had back and neck pain prior to the motor vehicle accident on July 26, 1994. The Defendants are only liable for any damages that you find to be proximately caused by the accident.
If you find from all the evidence that the damages cannot be apportioned as to what was caused by this accident and what was caused by the previous accident, then you are instructed that the Defendants are liable for the entire amount.
Subsequently, the jury returned a verdict for the defendants. On December 1, 1999, Bertch filed a motion for new trial. After a hearing, the trial court granted Bertch's motion for new trial. In its journal entry, the trial court stated that Bertch's proposed instruction should have been given. The court also stated that its failure to properly instruct the jury on Bertch's successive injuries was not harmless error.
The defendants appeal.
ASSIGNMENTS OF ERROR
On appeal, the defendants contend that the trial court erred in (1) granting Bertch's motion for new trial, because the instructions given to the jury were correct *295 as a matter of law, and (2) overruling their motions for a directed verdict, because Bertch failed to sustain her burden of proof that the July 26, 1994, accident proximately caused her injuries.
ANALYSIS
The defendants argue that the trial court erred in granting Bertch's motion for new trial, because the instructions given to the jury were correct as a matter of law.
A motion for new trial is addressed to the discretion of the trial court, whose decision will be upheld in the absence of an abuse of discretion. Jameson v. Liquid Controls Corp., 260 Neb. 489, 618 N.W.2d 637 (2000). A motion for new trial is to be granted only when error prejudicial to the rights of the unsuccessful party has occurred. Id.
Regarding Bertch's prior accident and Bertch's preexisting injuries, the trial court specifically instructed the jury in jury instruction No. 5: "There is evidence that the Plaintiff had a car accident prior to this one. The Defendants are liable only for any damages that you find to be proximately caused by this accident." The trial court failed to give Bertch's proposed jury instruction, based on NJI2d Civ. 4.09, which stated:
There is evidence that the Plaintiff Linda Bertch had back and neck pain prior to the motor vehicle accident on July 26, 1994. The Defendants are only liable for any damages that you find to be proximately caused by the accident.
If you find from all the evidence that the damages cannot be apportioned as to what was caused by this accident and what was caused by the previous accident, then you are instructed that the Defendants are liable for the entire amount.
On December 1, 1999, Bertch filed a motion for new trial. After a hearing, the trial court granted Bertch's motion for new trial. In its journal entry, the trial court stated that NJI2d Civ. 4.09 should have been given. The court also stated that its failure to properly instruct the jury on Bertch's successive injuries was not harmless error.
In Ketteler v. Daniel, 251 Neb. 287, 556 N.W.2d 623 (1996), the Nebraska Supreme Court addressed a similar case. In Ketteler v. Daniel, the trial court gave the following instruction, "There is evidence that the plaintiff had a neck, back and hip condition prior to the accident of April 26, 1991. The defendant is liable only for any damage that you find to be proximately caused by the accident of April 26, 1991." Id. at 295, 556 N.W.2d at 629.
The trial court did not give the following instruction which Ketteler had requested:
"There is evidence that Marilyn Ketteler had a pre-existing neck and back condition prior to the date of this collision. The Defendant is liable only for any damages that you find to be proximately caused by the collision of April 26, 1991.
"If you cannot separate damages caused by the pre-existing condition from those caused by the accident, then the Defendant is liable for all of those damages.
"The Defendant may be liable for bodily harm to Marilyn Ketteler even though the injury is greater than usual due to the physical condition which predisposed Marilyn Ketteler to the injury. In short, the Defendant takes the Plaintiff as he finds her."
Id. at 295-96, 556 N.W.2d at 629.
Citing David v. DeLeon, 250 Neb. 109, 547 N.W.2d 726 (1996), the Nebraska Supreme Court concluded that the trial court's failure to give Ketteler's proposed *296 instruction was reversible error. Therefore, the Supreme Court reversed, and remanded for a new trial.
In David v. DeLeon, the trial court gave at David's request an instruction similar to the proposed instruction in Ketteler v. Daniel, supra. DeLeon appealed, arguing that the portion of the instruction stating that if the jury could not separate damages then the defendant, DeLeon, was liable for all damages should not have been given. In rejecting this argument, the Supreme Court stated:
[A] plaintiff is not ... required to provide a precise line between the damages directly related to the accident and any preexisting physical or mental condition the defendant can exhume as a precondition for recovering any damages at all.... Once the plaintiff presents evidence from which a jury reasonably can find that damages were proximately caused by the tortious act, the burden of apportioning damages resulting from the tort rests squarely on the defendant.
David v. DeLeon, 250 Neb. at 115, 547 N.W.2d at 730.
In the instant case, the defendants appear to argue that Bertch failed to present evidence from which a jury could reasonably find that the July 26, 1994, accident was the proximate cause of Bertch's damages. Specifically, the defendants point to Thedinger's testimony at trial.
On direct examination, Thedinger testified:
Q. Doctor, based upon your examination, your tests, your experience, were you able to arrive atat a medical conclusion to a reasonable degree of certainty with regard to the cause of the conditionthe headaches and dizziness that Mrs. Bertch complained of on her visit to you on December 19th of 1996?
A. Yes, sir.
Q. Can you tell us what that was?
A. My conclusion was given that there was no other history and that she did not have any of these problems prior to the accidents, mymy thoughtmy conclusion was that these motor vehicle accidents caused her current symptoms.
On cross-examination, Thedinger further testified:
[Q.] Isn't it true that you can't tell us to a reasonable degree of medical certainty that either the June 13th, 1994 accident or the July 26th, 1994 accident caused her complaints; correct?
A. Correct.
Q. The June 13th, 1994 accident in and of itself could have caused her complaints; correct?
A. May have. Yes.
....
Q. But there's no way to state to a reasonable degree of certainty then that the July 26th, 1996(sic) accident caused her problems; correct?
A. Referring to each specific accident, no.
The defendants point to Thedinger's testimony on cross-examination and argue that Thedinger was unable to state whether either accident in 1994 caused any injury to Bertch. We read Thedinger's testimony differently. Although Thedinger could not state that either the June 13 or the July 26 accident alone caused Bertch's injuries, Thedinger testified with a reasonable degree of medical certainty that both accidents together were the causes of Bertch's injuries. Given Thedinger's testimony, we conclude that Bertch presented evidence from which a jury could reasonably find that her damages were proximately caused, at least in part, by the July 26 accident. Therefore, the burden of apportioning damages then rested squarely with the defendants. Clearly, in the instant *297 case, the trial court's instructions to the jury did not reflect this fact.
Given that the court's instruction regarding Bertch's preexisting injuries did not meet the requirements of David v. DeLeon, 250 Neb. 109, 547 N.W.2d 726 (1996), and Ketteler v. Daniel, 251 Neb. 287, 556 N.W.2d 623 (1996), we conclude that the trial court did not abuse its discretion in granting Bertch a new trial.
On appeal, the defendants also contend that the trial court erred in overruling their motions for a directed verdict because Bertch failed to sustain her burden of proof that the July 26, 1994, accident proximately caused Bertch's injuries.
A directed verdict is proper at the close of all the evidence only where reasonable minds cannot differ and can draw but one conclusion from the evidence, that is to say, where an issue should be decided as a matter of law. King v. Crowell Memorial Home, 261 Neb. 177, 622 N.W.2d 588 (2001).
The party against whom a verdict is directed is entitled to have every controverted fact resolved in his or her favor and to have the benefit of every inference which can reasonably be drawn from the evidence. If there is any evidence which will sustain a finding for the party against whom the motion is made, the case may not be decided as a matter of law. Genetti v. Caterpillar, Inc., 261 Neb. 98, 621 N.W.2d 529 (2001).
Given our above discussion regarding the cause of Bertch's injuries, we find no merit to the defendants' second assignment of error.
CONCLUSION
After reviewing the record, we conclude that the trial court did not err in overruling the defendants' motions for a directed verdict at trial, nor did the court err in granting Bertch's motion for new trial. Therefore, we affirm the order of the district court.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2621712/ | 89 P.3d 487 (2003)
Mike A. LEPRINO, Plaintiff-Appellant,
v.
NATIONWIDE PROPERTY AND CASUALTY INSURANCE COMPANY and Nationwide Mutual Insurance Company, Defendants-Appellees.
No. 02CA1863.
Colorado Court of Appeals, Div. IV.
November 6, 2003.
Certiorari Denied May 10, 2004.[*]
*489 Grimshaw & Harring, P.C., William J. Brady, Lisa K. Mayers, Denver, Colorado, for Plaintiff-Appellant.
Senter Goldfarb & Rice, L.L.C., William L. Senter, Nicole S. Gellar, Denver, Colorado, for Defendants-Appellees.
Opinion by Judge VOGT.
In this action arising out of the denial of insurance coverage, plaintiff, Mike A. Leprino, appeals the trial court's summary judgment in favor of defendants, Nationwide Property and Casualty Insurance Company and Nationwide Mutual Insurance Company. We affirm.
Plaintiff, a real estate developer, was one of several parties sued in 1998 by a group of homeowners who alleged that they had suffered damage because of unstable soil conditions under their homes. Plaintiff sent notice of the homeowners' claims to his insurers, including defendants, who had issued a series of commercial general liability and commercial umbrella liability insurance policies to him between 1986 and 1993.
Defendants declined to provide a defense or indemnity because the homeowners were not alleging property damage during the policy periods. Plaintiff's other insurers, who had policies in effect after 1993, provided a defense in the homeowners' action, and the homeowners' claims were ultimately settled.
Plaintiff then filed this action, seeking a declaratory judgment and damages for breach of contract and bad faith. Defendants moved for summary judgment. The trial court granted the motion, finding that the facts were not disputed and that there was no coverage for plaintiff under defendants' policies.
I.
Plaintiff contends that the allegations of the homeowners' complaint triggered defendants' duty to defend and that the trial court therefore erred in entering summary judgment on his claims. We disagree.
A.
We review a summary judgment de novo, using the same standards that govern the trial court's determination. Thus, we uphold summary judgment only if the pleadings and supporting documents demonstrate that there is no genuine issue for trial as to any material fact and that the moving party is entitled to judgment as a matter of law. C.R.C.P. 56(c); Aspen Wilderness Workshop, Inc. v. Colo. Water Conservation Board, 901 P.2d 1251 (Colo.1995).
We likewise review de novo the trial court's construction of an insurance contract, applying well settled principles of contract interpretation. Absent evidence in the policy of a contrary intent, we give words in an insurance policy their plain and ordinary meaning. We may not rewrite policy provisions that are clear and unambiguous, and we may neither add provisions to extend coverage beyond that contracted for nor delete them to limit coverage. Cyprus Amax Minerals Co. v. Lexington Ins. Co., 74 P.3d 294 (Colo.2003); see also Compass Ins. Co. v. City of Littleton, 984 P.2d 606 (Colo.1999).
A liability insurer's duty to defend its insured against pending claims is broader than its duty to indemnify, which refers to its obligation to satisfy a judgment entered against the insured. The duty to defend is determined by an examination of the allegations in the underlying complaint against the insured. If the alleged facts even potentially trigger coverage under the policy, the insurer is bound to provide a defense. The duty to indemnify arises only when the policy actually covers the harm, and this duty typically cannot be determined until the resolution of the underlying claims. Cyprus Amax Minerals Co. v. Lexington Ins. Co., supra; Compass Ins. Co. v. City of Littleton, supra.
*490 A policy is triggered when a threshold event implicates its coverage. A policy that has not been triggered does not provide any coverage, while a policy that has been triggered may or may not provide coverage, depending on the circumstances of the case. Pub. Serv. Co. v. Wallis & Cos., 986 P.2d 924 (Colo.1999).
B.
The liability insurance policies at issue here are "occurrence" policies. Occurrence policies protect an insured against claims made by third parties based on occurrences within the policy period that result in injury to the third parties' property interests. Under such policies, coverage is triggered only if the third party suffered actual damage within the policy period. Browder v. U.S. Fid. & Guar. Co., 893 P.2d 132 (Colo. 1995)(where third parties sustained no injury during insured's policy period, there was no occurrence that would trigger coverage under that policy); see also Union Pac. R.R. v. Certain Underwriters at Lloyd's, London, 37 P.3d 524 (Colo.App.2001).
Under an occurrence policy, "the time of the occurrence of an accident is not the time the wrongful act was committed but the time when the complaining party was actually damaged." Browder v. U.S. Fid. & Guar. Co., supra, 893 P.2d at 134 n. 2. In Samuelson v. Chutich, 187 Colo. 155, 529 P.2d 631 (1974), the supreme court concluded that the accident triggering coverage under the policy occurred at the time of the propane gas explosion and not when the allegedly wrongful actthe negligent installation of a gas linewas committed. It added: "To stretch the scope of `accident' backward in time to reach the date of the earliest beginning of any prior event which might be regarded as having a causal relation to the unlookedfor mishap would introduce ambiguity where none now exists." Samuelson v. Chutich, supra, 187 Colo. at 160, 529 P.2d at 635 (quoting Home Mut. Fire Ins. Co. v. Hosfelt, 233 F.Supp. 368 (D.Conn.1962)); see also Pike v. American States Preferred Ins. Co., 55 P.3d 212 (Colo.App.2002).
The language used in defendants' policies is consistent with the legal principles articulated in Browder. The insuring agreement in defendants' commercial general liability policies provided that the insurer would "pay those sums that the insured becomes legally obligated to pay as damages because of `bodily injury' or `property damage' to which this insurance applies." It further provided: "This insurance applies only to `bodily injury' and `property damage' which occurs during the policy period. The `bodily injury' or `property damage' must be caused by an `occurrence.'" (Emphasis added.) "Occurrence" was defined as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions."
The umbrella policies did not obligate the insurer to defend, but provided that the insurer would pay "the ultimate net loss in excess of the underlying limit or the retained limit, whichever is greater," because of property damage caused by an occurrence. Property damage was defined as "[p]hysical injury to or destruction of tangible property which occurs during the policy period, including all resulting loss of use of that property," and "[l]oss of use of tangible property which has not been physically injured or destroyed provided such loss of use is caused by an occurrence during the policy period." (Emphasis added.) "Occurrence" was defined in the umbrella policies, as pertinent here, as "an accident or a happening or event, including continuous or repeated exposure to conditions, which results in ... property damage neither expected nor intended from the standpoint of the insured."
Thus, under both the plain language of defendants' policies and the applicable law, coverage was available for the homeowners' property damage only if that damage occurred during the 1986-1993 policy periods.
C.
The homeowners alleged in their complaint that, from 1991 through "at least 1993," preparation and development of their lots had been carried out "in an improper and destabilizing manner," in disregard of applicable soils reports and county requirements. However, the only allegation of *491 property damage resulting from such wrongful acts was the following:
In or about March, 1998, the culmination of a continuous and progressive geologic hazard process manifested itself in the form of slope failure, landslide and/or landcreep on Green Mountain, damaging and/or otherwise significantly impairing all of the Plaintiffs' homes and underlying land. This process has resulted in actual property damage, a loss of the use and enjoyment of all or part of the Plaintiffs' homes and land, and an interruption of and eviction from some or all of the Plaintiffs' right of private occupancy, among other damages, losses and injuries.
The complaint did not allege that any of the homeowners suffered property damage before 1998.
Upon review of the homeowners' complaint and the language of defendants' policies, the trial court concluded that there was no coverage under any of the policies because the homeowners' claims did not involve any actual property damage during the policy periods. In so concluding, it rejected plaintiff's argument that "the occurrence which was insured against was the gradual slippage of the unstable soil which must have existed during the time period of the insurance policies."
Plaintiff again argues on appeal that the homeowners' complaint adequately alleged property damage during the defendants' policy periods. He asserts, first, that the relevant "occurrence" that triggered coverage was the "improper and destabilizing" pre-1993 cut-and-fill operations referenced in the complaint. We do not agree.
The allegations on which plaintiff relies referred to the negligence or other wrongful acts of the persons involved in preparing the lots. As such, they did not amount to allegations of property damage or of an "occurrence" that would trigger coverage. See Browder v. U.S. Fid. & Guar. Co., supra; Samuelson v. Chutich, supra.
We similarly do not agree with plaintiff that the reference in the underlying complaint to a "continuous and progressive geologic hazard process" can be construed to allege property damage within defendants' policy periods.
Notably, the complaint itself did not characterize such "geologic hazard process" as property damage, but alleged that it "has resulted in actual property damage." Nor did the complaint allege when the process began. As noted above, the Colorado Supreme Court has rejected similar efforts to "stretch the scope of `accident' backward in time" to reach the date of the earliest event that might be regarded as having a causal connection with the occurrence. Samuelson v. Chutich, supra, 187 Colo. at 160, 529 P.2d at 635.
Plaintiff's reliance on environmental damage cases in support of his argument is misplaced. In such cases, the continuing migration of toxic pollutants on and underneath the land causes actual, tangible damage to the soil or water supply during an ongoing period. See Hoery v. United States, 64 P.3d 214 (Colo.2003). This case does not present a situation where pollutants have been introduced onto or under the soil, resulting in property damage. We are aware of no authority that holds that the gradual slippage of unstable soil, without more, amounts to "property damage." Further, the soil movement here is unlike the progressive corrosion that, in American Employer's Ins. Co. v. Pinkard Construction Co., 806 P.2d 954 (Colo.App.1990), had already resulted in actual and widespread damage to a roof, during the relevant policy periods, before the roof finally collapsed.
Thus, even accepting plaintiff's contention that damage to the land alone, apart from the structures on it, could in some circumstances constitute property damage within the meaning of defendants' policies, the homeowners' complaint did not allege such property damage within the policy periods.
Nor did plaintiff contend, in opposing summary judgment, that discovery conducted after the filing of the complaint had revealed property damage within the policy periods. Rather, plaintiff relied on letters written by attorneys in the underlying case at a time when efforts were being made to persuade defendants to contribute to a settlement with the homeowners.
*492 Plaintiff cited a statement in a letter from the homeowners' counsel, written to "assist you [plaintiff's counsel] in your communications with these other defendants and their carriers," that he expected his experts would testify "that immediately following the conclusion of the improper and inadequate cut and fill operations, the fill mass immediately began to differentially settle," water began to infiltrate, and cracks began to appear. However, even assuming the trial court could consider matters outside the complaint in deciding the issue before it, see Cyprus Amax Minerals Co. v. Lexington Ins. Co., supra, letters consisting of hearsay within hearsay and referencing only nonspecific anticipated testimony could not, under C.R.C.P. 56, raise a genuine issue of fact sufficient to withstand summary judgment. See Norton v. Dartmouth Skis, Inc., 147 Colo. 436, 364 P.2d 866 (1961); Henderson v. Master Klean Janitorial, Inc., 70 P.3d 612 (Colo.App.2003); USA Leasing, Inc. v. Montelongo, 25 P.3d 1277 (Colo.App.2001).
In sum, because the facts alleged by the homeowners did not, even potentially, trigger coverage under defendants' policies, defendants were not obligated to provide a defense or indemnification. See Cyprus Amax Minerals Co. v. Lexington Ins. Co., supra. Thus, they neither breached their contractual obligations to plaintiff nor acted in bad faith. See Brennan v. Farmers Alliance Mut. Ins. Co., 961 P.2d 550 (Colo.App.1998); Jarnagin v. Banker's Life & Cas. Co., 824 P.2d 11 (Colo.App.1991). Summary judgment was therefore proper on all plaintiff's claims for relief.
II.
In light of our resolution of this issue, we do not address plaintiff's additional contentions on appeal.
The judgment is affirmed.
Judge KAPELKE and Judge WEBB concur.
NOTES
[*] Chief Justice MULLARKEY would grant as to the following issue:
Whether the underlying complaint read as a whole sufficiently alleged facts of an "occurrence" under the CGL insurance policy to trigger the insurers' duty to defend. | 01-03-2023 | 11-01-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/779192/ | 304 F.3d 335
UNITED STATES of America, Plaintiff-Appellee,v.Overton Wayne PAULEY, Defendant-Appellant.
No. 00-4359.
United States Court of Appeals, Fourth Circuit.
Argued January 25, 2002.
Decided April 22, 2002.
Opinion on Rehearing Filed September 18, 2002.
ARGUED: David Robert Bungard, Robinson & McElwee, L.L.P., Charleston, West Virginia, for Defendant-Appellant. John Castle Parr, Assistant United States Attorney, Huntington, West Virginia, for Plaintiff-Appellee. ON BRIEF: Rebecca A. Betts, United States Attorney, Stephanie Taylor, Student Intern, Huntington, West Virginia, for Plaintiff-Appellee.
Before WIDENER and GREGORY, Circuit Judges, and CYNTHIA HOLCOMB HALL, Senior Circuit Judge of the United States Court of Appeals for the Ninth Circuit, sitting by designation.
Prior panel opinion modified and district court judgment affirmed by published PER CURIAM opinion.
OPINION
PER CURIAM.
1
Overton Wayne Pauley was indicted for and convicted of a drug offense. He appealed his conviction and we vacated and remanded in part and affirmed in part, by published opinion. United States v. Pauley, 289 F.3d 254 (4th Cir.2002). We now grant appellee's petition for rehearing and, after having had the benefit of briefing and dispensing with oral argument, modify our prior opinion, in light of the United States Supreme Court decision in United States v. Cotton, 535 U.S. 625, 122 S.Ct. 1781, 152 L.Ed.2d 860 (2002), so as to affirm the sentence that we previously vacated.
2
Under the standard of "plain error" appellate review set forth by the Supreme Court in Cotton, we are required to affirm the district court's original sentence where, as here, there is "overwhelming" and "essentially uncontroverted," Cotton, 535 U.S. at ___, 122 S.Ct. at 1786, evidence of the defendant's participation in a drug crime involving at least as great a drug quantity as is required to support the relevant § 841(b)(1) sentence maximum. The district court sentenced Pauley to 40 years imprisonment, the statutory maximum authorized by § 841(b)(1)(B). Section 841(b)(1)(B) is triggered by either 5 grams or more of methamphetamine or 50 grams or more of a mixture containing a detectable amount of methamphetamine. Because there was overwhelming and unconverted evidence that Pauley participated in a drug crime involving at least 56 grams of methamphetamine, and Pauley's sentence did not exceed the maximum allowable under § 841(b)(1)(B), we affirm his original sentence.
3
We leave our prior panel opinion intact in all other respects.
4
It is so ordered. | 01-03-2023 | 04-18-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/1581810/ | 31 So.3d 355 (2010)
STATE of Louisiana
v.
William Troy MANNING.
No. 2009-KO-1749.
Supreme Court of Louisiana.
April 5, 2010.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582416/ | 31 So.3d 818 (2010)
Marcos ESPINAL, Petitioner,
v.
Timothy RYAN, Director of Miami-Dade County Department of Corrections, Respondent.
No. 3D10-139.
District Court of Appeal of Florida, Third District.
January 26, 2010.
Rehearing Denied March 29, 2010.
*819 Michael D. Walsh and Matthew Troccoli, Miami, for petitioner.
Bill McCollum, Attorney General, and Magaly Rodriguez, Assistant Attorney General, for respondent.
Before GERSTEN, SHEPHERD, and LAGOA, JJ.
SHEPHERD, J.
The Petitioner in this case seeks habeas relief from a trial court order denying his motion to set aside an alias capias issued and reinstate bond, which had been revoked because petitioner was fifteen minutes late for a court appearance. We find the Petitioner's claim meritorious, and grant the petition.
Marcos Espinal was scheduled for a docket sounding at 8:30 a.m. on January 7, 2010, for his pending criminal case. Neither he nor his counsel were present when his case was called. The trial court sua sponte issued an alias capias and estreated his bond. When Espinal's case was recalled approximately an hour into that morning docket, both the defendant and his counsel were present. Espinal explained he started a new job that night, and he had arrived to court fifteen minutes late due to his need to travel to court from his new job.
The record indicates this is the first time Espinal has been late to court for the present infraction. His only other known brush with the law is an arrest and pretrial diversion placement for an unascertainable misdemeanor[1] in 2002, which was not fully resolved until 2007. The apparent reason the misdemeanor file was not closed was that Espinal moved to Rhode Island before his last court date in the case, for which his only remaining obligation was a requirement that he pay a small fee. Upon his return to Florida in 2007, he paid the fee. On these facts, the court ordered Espinal into custody.
It is clear that the defendant's failure to appear timely before the court in this case was unintentional and de minimus in length. It was defendant's "first offense." Although the court was justly annoyed by the defendant's tardiness, it was minimally inconvenienced. A court should be very cautious about depriving a person of his liberty in such a circumstance. See Eulo v. State, 786 So.2d 43, 44 (Fla. 4th DCA 2001) (holding defendant's fifteen minute delay to court was de minimus, and did not warrant a sentence above that which was bargained for); Prior v. State, 562 So.2d 864 (Fla. 5th DCA 1990) (concluding defendant could not be held accountable for criminal contempt where the record established negligence at best in failing to appear at the proper time for trial); Johnson v. State, 501 So.2d 158, 160 (Fla. 3rd DCA 1987) (reasoning where defendant was arrested on his way to court, and thus failed to appear on time, there was no willful failure to appear, and the original, bargained-for sentence should be imposed); Lee v. State, 471 So.2d 195 (Fla. 4th DCA 1985) (holding there was no evidence to support a finding that the defendant willfully failed to appear for sentencing, or that he committed another crime while on release; thus, the defendant was entitled *820 to a reversal of his enhanced sentence). We also find the fact that the defendant failed to appear in court on one prior occasion between some five and eight years ago insufficient to support the incarceration.
For the foregoing reasons, we grant the petition. The petitioner is entitled to immediate release. The trial court shall reinstate the petitioner's original bond.
This opinion shall take effect immediately, notwithstanding any motions for rehearing.
Petition granted.
NOTES
[1] The court file for the misdemeanor case has been destroyed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581773/ | 957 F. Supp. 647 (1997)
UNITED STATES of America
v.
Angela NOLAN-COOPER.
Criminal Action No. 95-435-01.
United States District Court, E.D. Pennsylvania.
March 11, 1997.
*648 David M. Howard, Dechert, Price and Rhoads, Philadelphia, PA, for Defendant.
Angela Nolan-Cooper, Philadelphia, PA, pro se.
Terri A. Marinari, U.S. Attorney's Office, Philadelphia, PA, for U.S.
MEMORANDUM
ROBRENO, District Judge.
I. INTRODUCTION
Angela Nolan-Cooper stands before the Court for sentencing having pled guilty to: 1) one count of conspiracy to commit money laundering, in violation of 18 U.S.C. § 1956(h) and 18 U.S.C. § 1956(a)(3)(B) (Count 3); 2) ten counts of money laundering to conceal or disguise the source or ownership of property represented to be proceeds of specified unlawful activity and aiding and abetting, in violation of 18 U.S.C. § 1956(a)(3)(B) and 18 U.S.C. § 2 (Counts 11, 13 to 18, 20, 27 and 28); 3) one count of conspiracy to structure or assist in structuring any transaction with one or more domestic financial institutions, in violation of 18 U.S.C. § 371 and 31 U.S.C. § 5324(a)(3) (Count 29); and 4) one count of criminal forfeiture pursuant to 18 U.S.C. § 982(a)(1) (Count 32).
Pursuant to a plea agreement, the government has moved to dismiss counts one, two, *649 four, five, six, seven, eight, nine, ten, twenty-two and thirty-one of the superseding indictment. These counts include drug charges, as well as other charges of structuring, money laundering and criminal forfeiture.
Also in the plea agreement, the government and the defendant stipulated to a guideline range of 41 to 51 months of incarceration (this range is based on an offense level of 22). In the presentence investigation ("PSI") report, the probation officer calculates the offense level to be 26 which, based upon Ms. Nolan-Cooper's criminal history level of I, would subject the defendant to a sentence of 63 to 78 months.
The defendant has raised objections to the PSI report's recommendation for upward adjustments based on the defendant's use of her special skill as a lawyer and obstruction of justice. She also objects to the failure of the PSI report to recommend an additional one level downward adjustment for acceptance of responsibility.[1] Additionally, the defendant moves for a downward departure on the grounds of outrageous government conduct and sentencing factor manipulation. For the reasons discussed below, the defendant's objections are overruled and her motion for downward departure is denied.
II. FACTUAL BACKGROUND[2]
The Internal Revenue Service ("IRS") received information from a confidential informant that Ms. Nolan-Cooper, a Philadelphia lawyer, was assisting others to launder funds received through the sale of drugs and other illegal activities. The IRS arranged for Ms. Nolan-Cooper to be introduced to IRS Special Agent Louis Oubre. Agent Oubre, acting in an undercover capacity, posed as "Louis A. Richard," a drug dealer from the New Orleans area, who had significant drug proceeds that he wished to make look legitimate. The introduction of Ms. Nolan-Cooper to Agent Oubre in his undercover capacity took place at a hotel near the Philadelphia Airport on February 7, 1994. This meeting was arranged and attended by one Oswald McBride, an acquaintance of Ms. Nolan-Cooper, who unbeknownst to Ms. Nolan-Cooper had turned Government informant.
Ms. Nolan-Cooper attended the meeting with the understanding that "Mr. Richard" (hereafter referred to as Agent Oubre in his undercover capacity), had some business dealings to discuss with her. She quickly learned that the business Agent Oubre wanted to discuss was how to make illegitimate money look legitimate. Tr. of Feb. 7, 1994 Meeting at 1-2. During that first meeting, Ms. Nolan-Cooper also learned that Agent Oubre was a drug dealer and that the money he was seeking to launder was the proceeds from illegal drug sales. Id. at 29, 32.[3]
At the outset, Ms. Nolan-Cooper suggested that she could help Agent Oubre make his money look legitimate in two ways: 1) by *650 setting up a sham business for him; and 2) by hiding his money in accounts in the Bahamas. Id. at 1-2.[4] She explained to the agent why he should, and how he could hide his money in the Bahamas, what procedures he would use, what precautions he would have to take, and how he could get his money back from the Bahamas. Id. at 2-9.[5] She then discussed the advantages of forming a corporation and running his money through a business to make it look legitimate by showing a source of income and filing tax returns. Id. at 9-12. After she told the agent about these options, Agent Oubre asked Ms. Nolan-Cooper, "So you could help me do all of these things?" Her answer was, "Um hmm." Id. at 12.
She further assured the agent that she was ready, willing and able to help him legitimize his purported ill-gotten gains, "trust me, I have plenty of clients ... and it's the same situation you have.... And there's nothing on 'em for years." Id. at 13-14. At the end of the first meeting, she again assured Agent Oubre, "the way I do it, I'm ... not gonna make any mistakes." Id. at 37. When the agent asked her, "Well, how soon ... can we start," Ms. Nolan-Cooper replied, "Right away." Id. at 29.
Ms. Nolan-Cooper also suggested that, rather than start his own business, Agent Oubre could "invest in a business already established here" which, she said, is run by "someone who's in a very similar situation with you" who "has a recording studio ... in Jersey." Id. at 19-20. While the business itself may not be profitable, "even in losing the money ... it's helped [the person doing the money laundering] to legitimize everything else." Id. at 20. She also acknowledged that she helps this person hide his money in the Bahamas. "[H]e's another person that I'm back and forth. I do the same thing with him." Id. The evidence bears out that the person to whom Ms. Nolan-Cooper was referring was codefendant Ester Carter, who also stands convicted of money laundering in connection with this case.
Ms. Nolan-Cooper touted the advantages of the music business because "you create your own records.... you can ... show on paper ... that you generated ... eight hundred and fifty thousand dollars in five months.... In studio time. And nobody's ever been in the studio ... they can't ever check that.... So this is income. This is legitimate income." Id. at 21. She explains that this is possible because the agent could "make up" a rap group and say they spent several thousand dollars at the studio and there would be "no way that the IRS can trace those people." Id. at 22. As the first meeting was concluding, Ms. Nolan-Cooper offered to take the agent to look at the studio the following day. Id. at 36.
The second meeting took place only two days later. Agent Oubre told Ms. Nolan-Cooper that he wanted to start his own corporation first, instead of investing in the existing business. Tr. of Feb. 9, 1994 Meeting at 10, 12. He told her that he did like *651 the idea of starting a corporation in the music business. Id. at 12-13. Ms. Nolan-Cooper said that to look legitimate, Agent Oubre's business would need an office. She volunteered to set Agent Oubre up with office space at the New Jersey studio. Id. at 13, 35. She told Agent Oubre that once the corporation is incorporated, he can "set up a corporate bank account," "pay rent for a couple of months" and then "start making intermittent deposits" and "start to build the account up." Id. at 16-17. She also told him that she could use her attorney escrow account to help him funnel his money into his "legitimate" business account, or into his Bahamian account. Id. at 17-19.[6]
Agent Oubre and Ms. Nolan-Cooper met for a third time on March 11, 1994. At that meeting they agreed to set up a corporation entitled "LAR Productions, Inc." as a purported music production, promotion and recording company. Tr. of Mar. 11, 1994 Meeting at 2-4, 26-27. Agent Oubre gave Ms. Nolan-Cooper twelve thousand dollars to open the corporate bank account. Id. at 41. She then introduced Agent Oubre to Mr. Carter by phone so that Agent Oubre could rent office space for LAR Productions at Mr. Carter's music studio. Id. at 43-45. She told Agent Oubre that he should furnish the office with a phone, fax, computer, desk and pictures, and that she could help him do that. Id. at 29. She told him that he could prepare vouchers with names of fictitious aspiring recording artists to make it appear as though the money going into the business account was coming from legitimate musical production work, which would be untraceable. Id. at 31. She explained to Agent Oubre that he would have to pay taxes on the money he ran through the production company and that she "w[ould] set [him] up with an accountant." Id. at 38. At this meeting, Agent Oubre also paid Ms. Nolan-Cooper $5,000 as a retainer. Id. at 21. Subsequent to the meeting, Ms. Nolan-Cooper incorporated "LAR Productions, Inc.," opened a bank account and provided Agent Oubre with a corporate seal.
On May 10, 1994, Ms. Nolan-Cooper took Agent Oubre to Mr. Carter's recording studio in New Jersey. Agent Oubre expressly told Mr. Carter that his money came from drugs and that Ms. Nolan-Cooper was helping him make it look legitimate. Tr. of May 10, 1994 Meeting at 147. On September 29, 1994, Agent Oubre paid Mr. Carter $6,615 for six months rent and one month security deposit for an office at the recording studio. On December 19, 1994, a lease, backdated to July 1, 1994, was drafted by Ms. Nolan-Cooper. Mr. Carter and Agent Oubre both signed the backdated lease. On February 1, 1995, Agent Oubre paid Mr. Carter $955 for the January rent. The space rented by Agent Oubre remained unoccupied throughout the conspiracy.
Agent Oubre also gave Ms. Nolan-Cooper $42,000 in cash to launder through the LAR Productions account on May 10. She told him she could not do it all at once but would do it slowly. She subsequently made several deposits from her attorney escrow account into the account of LAR Productions ($5,000 on May 11, 1994, $5,000 on August 10, 1994, $22,500 on September 29, 1994, and $8,000 on December 20, 1994).
Also on May 10, 1994, Ms. Nolan-Cooper told Agent Oubre that she could get him an American Express credit card through her law firm, falsely listing him as an investigator employed by her firm. As promised, she sent Agent Oubre the American Express card on June 13, 1994. Agent Oubre used the card on numerous occasions and reimbursed Ms. Nolan-Cooper for the charges.
Although the actual transaction took place much later, May 10 was also the day that Ms. Nolan-Cooper told Agent Oubre that he could obtain a car from one of her clients, *652 Benjamin Goff. Agent Oubre later spoke to Mr. Goff directly on several occasions, telling Mr. Goff that his money came from drugs and that he wanted the car titled in someone else's name, and giving him the specifications for the car including hidden compartments to transport drugs. On February 7, 1995, Ms. Nolan-Cooper arranged to have Agent Oubre deliver $34,000 to her for the purchase of the car from Mr. Goff. On February 15, 1995 Ms. Nolan-Cooper gave Mr. Goff a check from her attorney escrow account to pay for the car. Mr. Goff deposited the check into his own account. He then paid $28,128 for the car on February 17, 1995 using a treasurer's check and a cashier's check. The car was titled under the fictitious name "Darryl Young," and delivered to Agent Oubre. Mr. Goff and Ms. Nolan-Cooper divided the difference between the $34,000 Agent Oubre had paid for the car and the purchase price of $28,128.
On December 19, 1994, Agent Oubre gave Ms. Nolan-Cooper $85,000 to transfer into an account in the Cayman Islands. He told her he needed to get the money there to consummate a drug deal. Agent Oubre paid Ms. Nolan-Cooper $8,490 to perform the wire transfer. She enlisted codefendants Darnell Greene, Stephen Henderson and Warren Mikell to assist her in structuring this transaction to avoid detection.[7] She and the three others each deposited $21,250 (one fourth of Agent Oubre's $85,000) in accounts under their own names. On December 29, 1994 each wired $21,250 from their accounts to an account in the Cayman Islands.
On December 19, 1994, Ms. Nolan-Cooper brought Carl Ellis, an accountant and a former client of Ms. Nolan-Cooper, into the conspiracy. At the first meeting between Mr. Ellis and Agent Oubre, and in the presence of Ms. Nolan-Cooper, Agent Oubre told Mr. Ellis that he had a large amount of cash that came from drugs. Ms. Nolan-Cooper told Mr. Ellis that $50,000 dollars of drug proceeds had been deposited into LAR Production's bank account. Mr. Ellis agreed to prepare both a business plan and a corporate tax return which would falsely indicate that the money had come from a loan. That day, Agent Oubre gave Mr. Ellis a $500 retainer fee. Mr. Ellis met with Agent Oubre and Ms. Nolan-Cooper again on February 1, 1995. He advised them of various ways to disguise the source of the cash deposited into LAR Production's account and discussed filing false tax returns and financial statements for the corporation. He received an additional $400 retainer at this time.
The total amount involved in the money laundering scheme to which Ms. Nolan-Cooper has pled guilty is $192,772. The evidence is overwhelming that Ms. Nolan-Cooper's criminal conduct in this case was pervasive and entirely voluntary. From the first meeting with Agent Oubre, Ms. Nolan-Cooper planned the scheme to launder the proceeds of drug activities, recruited coconspirators, counselled Agent Oubre as to how to execute the scheme, and then personally undertook to effectuate the objectives of the conspiracy.
Since the time of her arraignment in October 1995, and through oral arguments on the pretrial hearing in October 1996, Ms. Nolan-Cooper has contended that this prosecution should be dismissed because of three alleged sexual encounters between her and Agent Oubre. Ms. Nolan-Cooper asserts that the conduct of Agent Oubre in this case constitutes outrageous government conduct. After a six day hearing and oral argument, the Court found that the first two sexual encounters alleged had not occurred but that the third sexual encounter, near the end of the investigation and after Ms. Nolan-Cooper had committed her criminal conduct, had occurred. The Court concluded, however, that Agent Oubre's conduct under the circumstances of this case did not rise to the level of outrageousness constituting a due process violation.[8]See infra section III.B.1 (discussing *653 the defendant's motion for downward departure based on the claim of alleged outrageous government conduct).
III. SENTENCING ISSUES[9]
A. Guideline Calculations
1. Offense Level Calculations
According to the PSI report, the base offense level for a violation of 18 U.S.C. § 1956(h) is 20. U.S.S.G. § 2S1.1. All the offenses are grouped under the highest offense level, pursuant to U.S.S.G. § 3D1.2(d), because the offense level for all Ms. Nolan-Cooper's offenses is determined largely by the amount of harm or loss.
Under specific offense characteristics, three levels are added because the defendant knew or believed the funds to be the proceeds of drug sales. U.S.S.G. § 2S1.1(b)(1). The defendant raises no objection to these calculations.
In accordance with U.S.S.G. § 2S1.1(b)(2), the probation officer increased the offense level by one because the amount of money laundered was over 100,000 (in the plea agreement the government and the defendant stipulated that the range of money laundered was between $100,000 and $200,000). The defendant does not specifically object to this additional level but requested that the probation officer report: 1) the amount Ms. Nolan-Cooper actually received for the services she performed for the agent; 2) that the agent set the amount he paid her; 3) that the government set the amount stipulated to; and 4) that the agent told Ms. Nolan-Cooper that he wanted his money laundered so that he could retire from the drug business. PSI Objection 2. Furthermore, as discussed below, Ms. Nolan-Cooper is seeking a downward departure based on the contention that the government controlled the amount of money which was to be laundered. Therefore, under the PSI, and before any adjustments are made, the offense level for Ms. Nolan-Cooper is 24.
2. Adjustments
a. Adjustment for Role in the Offense
The probation officer increased the offense level by two in accordance with U.S.S.G. § 3B1.3[10] because Ms. Nolan-Cooper used her special skills as a lawyer to assist the agent in laundering his purported drug proceeds.[11] Ms. Nolan-Cooper objects to this *654 adjustment because she alleges that she did not use any sophisticated legal skill in helping the agent, rather she acted more in the capacity of a business manager (incorporating LAR Productions, setting up bank accounts, renting office space, getting furniture, hiring an accountant, purchasing an automobile, transferring funds by wire, etc.). Def.Sent.Mem. at 11-12; PSI Objection 7.[12]
Application Note 2 to U.S.S.G. § 3B1.3 states "`[s]pecial skill' refers to a skill not possessed by members of the general public and usually requiring substantial education, training or licensing. Examples would include pilots, lawyers, doctors, accountants, chemists, and demolition experts." An adjustment for use of special skills "`applies to persons who abuse their special skills to facilitate significantly the commission or concealment of a crime.'" United States v. Maurello, 76 F.3d 1304, 1314 (3d Cir.1996) (quoting Background to U.S.S.G. § 3B1.3).
Therefore, before imposing an upward adjustment on Ms. Nolan-Cooper for use of a special skill pursuant to U.S.S.G. § 3B1.3, the Court must find "(1) that [Ms. Nolan-Cooper] possesses a special skill; and (2) that [she] used it to significantly facilitate the commission or concealment of [her] offense." Id. (citing United States v. Hickman, 991 F.2d 1110, 1112 (3d Cir.1993)).
Clearly, Ms. Nolan-Cooper used her lawyering special skills in several ways to facilitate the commission and concealment of her offense. In itself, the use of her attorney escrow account to funnel money for the agent significantly facilitated concealment of the offense. Moreover, the Court agrees with the probation officer that Ms. Nolan-Cooper used her legal knowledge of the tax laws to structure financial transactions to avoid detection, and used her knowledge of the Bahamian laws that certain funds deposited in Bahamian financial institutions are free from disclosure to the United States government.
The defendant's argument that her skills were general business skills, ones akin to those of a business manager and not the special skills possessed solely by lawyers, is disingenuous. As the Third Circuit has held "including defendant's experiences and general knowledge acquired over the course [her] legal career within the contours of [her] special skills is warranted." Id. (citing, inter alia, United States v. White, 972 F.2d 590, 600-01 (5th Cir.1992), cert. denied sub nom., Wilson v. United States, 507 U.S. 1007, 113 S. Ct. 1651, 123 L. Ed. 2d 272 (1993) (finding use of a special skill where a defense attorney specializing in drug cases used knowledge acquired as a prosecutor and defense lawyer to avoid surveillance during drug conspiracy activities)).
Here, Ms. Nolan-Cooper had received formal training, and had experience incorporating businesses and drafting leases. Her experience in the Bahamas had also lead her to acquire knowledge of tax and banking laws which she utilized in the money laundering scheme to avoid detection. The Court concludes that Ms. Nolan-Cooper possessed special skills and used these skills to significantly facilitate the offense. Therefore, an adjustment for the use of her special skills is appropriate.
b. Adjustment for Obstruction of Justice
The probation officer adjusted the offense level upward two levels for obstruction of justice in accordance with U.S.S.G. § 3C1.1[13]*655 because Ms. Nolan-Cooper perjured herself during the Court's hearing on her motion to dismiss on the due process ground of outrageous government conduct. Ms. Nolan-Cooper testified that she and Agent Oubre had engaged in sexual relations on three occasions. The Court found that sexual relations had occurred on only one occasion, near the end of the investigation, and after Ms. Nolan-Cooper had largely completed her criminal conduct.
The Supreme Court has stated that when "a defendant objects to a sentence enhancement resulting from her trial testimony, a district court must review the evidence and make independent findings necessary to establish a willful impediment to or obstruction of justice ... under the perjury definition we have set out." United States v. Dunnigan, 507 U.S. 87, 95, 113 S. Ct. 1111, 1117, 122 L. Ed. 2d 445 (1993). In Dunnigan, the Supreme Court relied on the statutory definition of perjury at section 1621 of title 18 of the United States Code, which states that "[a] witness testifying under oath or affirmation violates this statute if she gives false testimony concerning a material matter with the willful intent to provide false testimony, rather than as a result of confusion, mistake, or faulty memory." Dunnigan, 507 U.S. at 94, 113 S.Ct. at 1116.
Ms. Nolan-Cooper objects to the obstruction of justice adjustment because the Court did not make a specific finding that she had perjured herself. She also contends that the subject of her allegedly perjured testimony was not material. PSI Objection 6; Def. Sent.Mem. at 12-13.[14]
i. The Court Finds that Ms. Nolan-Cooper Gave False Testimony at the Pretrial Hearing
The Court has reviewed the transcript and its findings from the pretrial hearing, and concludes that Ms. Nolan-Cooper willfully provided false testimony regarding her accusations that sexual relations occurred between her and Agent Oubre in August and December of 1994.
After a six day hearing, the Court found that during the approximately thirteen months of the investigation, Agent Oubre, made several trips to the Philadelphia area to meet with Ms. Nolan-Cooper. While in Philadelphia, Agent Oubre played the role of a wealthy drug dealer who stayed in expensive rooms at the city's best hotels, rented fancy cars and bought expensive dinners and liquor.
During the investigation, Agent Oubre escorted Ms. Nolan-Cooper to dinner on several occasions. These social occasions were generally initiated by Agent Oubre. However, Ms. Nolan-Cooper accepted Agent Oubre's invitations without hesitation. Often these social outings were attended by other individuals, some whom were coconspirators recruited by Ms. Nolan-Cooper to facilitate the illegal objectives of the money laundering scheme.
These evenings frequently consisted of dinner and drinks at some of the finest restaurants in the Philadelphia area, and, on several occasions, the partying continued late into the evening at some of the area's nightclubs. These nights out on the town were paid for by Agent Oubre with funds supplied to him by the government, often costing upwards of several hundred dollars per night.
Ms. Nolan-Cooper testified that on the early morning of August 13, 1994, she and Agent Oubre had sexual relations in Agent Oubre's room at the Omni Hotel in Philadelphia. Ms. Nolan-Cooper stated that after going out to several nightclubs with Agent Oubre, co-defendant Darnell Greene and another female, she and the agent returned to his room at the Omni Hotel at approximately 4:00 a.m. Ms. Nolan-Cooper claimed that she stayed in Agent Oubre's room for about an hour, during which time she engaged in sexual relations with him. Agent Oubre denied this allegation.
At the hearing, Ms. Nolan-Cooper called two witnesses, ostensibly to corroborate her allegations. Raymond Jawers, a friend of Ms. Nolan-Cooper, said that he saw her at the Black Banana nightclub with a man *656 roughly fitting the description of Agent Oubre who had his arm around her and was kissing her. Flora Pauling, also a friend of Ms. Nolan-Cooper, testified that she saw Ms. Nolan-Cooper driving towards her home between 6:15 a.m. and 7:30 a.m. the next morning, roughly at the time it would have been had Ms. Nolan-Cooper stayed an hour in Agent Oubre's room. Neither witness, however, had personal knowledge of whether Ms. Nolan-Cooper was with Agent Oubre in Agent Oubre's room during the time alleged.
Three government surveillance agents[15] who were posted outside the hotel throughout the evening testified that they saw Agent Oubre, Ms. Nolan-Cooper, Mr. Greene and his companion arrive at the hotel at approximately 4:00 a.m. The agents testified that Mr. Greene and his companion left from the hotel almost immediately and that Agent Oubre and Ms. Nolan-Cooper talked outside the hotel for approximately five minutes. Ms. Nolan-Cooper then left in her car and Agent Oubre went into the hotel, according to the agents.
The three agents also testified that they went to Agent Oubre's room, after about ten minutes, and debriefed him. The debriefing was reportedly completed by approximately 4:30 a.m. when they left Agent Oubre alone in the hotel. This testimony was uncontradicted. The Court credited the testimony of the three IRS agents who were on surveillance that night and found that Agent Oubre and Ms. Nolan-Cooper did not have the opportunity to be alone in Agent Oubre's room as testified to by Ms. Nolan-Cooper. Therefore, the Court found that Ms. Nolan-Cooper and Agent Oubre could not have engaged in sexual relations on the early morning of August 13, 1994, as claimed by Ms. Nolan-Cooper.
Ms. Nolan-Cooper also testified that on the early morning of December 17, 1994, she and Agent Oubre again engaged in sexual relations. She stated that she and Agent Oubre went to several nightclubs alone and returned to the Omni Hotel at approximately 2:00 a.m.
Ms. Nolan-Cooper testified that after returning to the Omni Hotel, she told Agent Oubre that her car needed gas and asked the agent to follow her in his car to a Mobil station a few blocks from the hotel. After Ms. Nolan-Cooper had obtained gas at the station, Ms. Nolan-Cooper testified, Agent Oubre asked her back to his room. She asserted that once they were back in the agent's room, the two engaged in sexual relations. Agent Oubre denied this allegation.
Agent Dollard, who was on surveillance that evening with several other agents, testified that he observed Agent Oubre and Ms. Nolan-Cooper return to the hotel at approximately 2:00 a.m. and then observed Ms. Nolan-Cooper leave in her car followed by Agent Oubre in his car.[16] Agent Dollard said he then went to his nearby office and placed a call to Agent Oubre's pager. Agent Oubre promptly returned his page using his cellular phone and told Agent Dollard he would meet him back at the hotel in approximately five minutes. Ms. Nolan-Cooper corroborated that Agent Oubre was on the phone while she was at the gas station.
Additionally, Agent Oubre's telephone records show a twelve minute phone call to Agent Dollard's office at approximately the time Agent Dollard had indicated. Agent Dollard testified that he, accompanied by Customs Agent Walt Michalewjik, met Agent Oubre back at the hotel about five minutes later. Agents Oubre, Dollard and Michalewjik then proceeded to Pat's Steak House in South Philadelphia for cheese steaks and *657 then returned to the hotel to discuss the investigation.
The Court credited the testimony of Agent Dollard and found that Agent Oubre and Ms. Nolan-Cooper did not have the opportunity to be alone in Agent Oubre's room. Therefore, the Court found that Ms. Nolan-Cooper and Agent Oubre could not have engaged in sexual relations in the early morning of December 17, 1994, as claimed by Ms. Nolan-Cooper.[17]
In light of these findings, the Court concludes that Ms. Nolan-Cooper's statements constituted false testimony provided willfully. The Court notes that three witnesses corroborated Agent Oubre's testimony regarding the early morning of August 13, and one witness and a subsequent recorded telephone conversation with Ms. Nolan-Cooper corroborated his testimony regarding the early morning of December 17. Ms. Nolan-Cooper's testimony, to the contrary, therefore, could not have been the "result of confusion, mistake, or faulty memory," Dunnigan, 507 U.S. at 94, 113 S.Ct. at 1116. As in Dunnigan, there were "numerous witnesses who contradicted [the defendant] regarding so many facts on which she could not have been mistaken, [that] there is ample support for the District Court's finding [of perjury]." Id. at 95-96, 113 S.Ct. at 1117. See also United States v. Bethancourt, 65 F.3d 1074, 1078 (3d Cir.1995), cert. denied, ___ U.S. ___, 116 S. Ct. 1032, 134 L. Ed. 2d 109 (1996) (upholding an adjustment for obstruction of justice where the trial court had concluded that the government agents had testified truthfully and the defendant had not, after the defendant testified at trial that he was handcuffed and threatened during an interrogation which led to his confession while the interrogating agents testified that the defendant was neither handcuffed nor threatened).
ii. The Perjured Statements Were Material
The defendant argues that in order for her statements to be considered perjury they must have been material. In support of her argument, the defendant points out that the criminal statute covering perjury requires that the perjured statement must concern a "material matter." 18 U.S.C. § 1621(1).[18] The defendant also cites Application Note 5 to U.S.S.G. § 3C1.1 which states "`[m]aterial evidence, fact, statement, or information, as used in this section, means evidence, fact, statement, or information that, if believed, would tend to influence or affect the issue under determination." See also Dunnigan, 507 U.S. at 94, 113 S.Ct. at 1116. The Supreme Court has held that a statement is "material if it `has a natural tendency to influence, or was capable of influencing, the decision of the decision-making body to which it was addressed." Kungys v. United States, 485 U.S. 759, 770, 108 S. Ct. 1537, 1546, 99 L. Ed. 2d 839 (1988).[19]
The defendant contends that her statements alleging that she and Agent Oubre engaged in sexual relations in August and *658 December, 1994 were not material to the determination of whether her due process rights were violated. The defendant claims this is so because, while the Court found that sexual relations did occur between Ms. Nolan-Cooper and Agent Oubre in February, 1995, the Court concluded that these sexual relations did not violate due process. See infra section III.B.1. The inference the defendant apparently wishes the Court to draw is that, since the Court found one incident of sexual relations was not a violation of due process, three incidents would not be either.
The defendant's argument is misguided. The Court did indeed find that the agent had sexual relations with Ms. Nolan-Cooper and that the sexual relations did not violate her due process rights. The Court, however, noted that the sexual relations occurred on only one occasion, at the end of the investigation, after Ms. Nolan-Cooper's criminal conduct was nearly completed, and was the result of a rogue agent purposely misleading his supervisors. It was under those specific circumstances that the Court concluded that the one incident of sexual relations did not rise to the level of a due process violation. Whether sexual contact between a defendant and an undercover agent would rise to the level of outrageous government conduct under different circumstances is, of course, not before the Court at this time. See United States v. Cuervelo, 949 F.2d 559 (2d Cir. 1991).[20] In fact, it may well have been the realization of the legal importance of placing the sexual encounters with Agent Oubre at an earlier point, in the middle of the investigation, and not simply at the end, which animated Ms. Nolan-Cooper's perjurious testimony.
Nor does the Court agree that the defendant's testimony was not material to the outcome of the case. It is clear that Ms. Nolan-Cooper's assertions that sexual relations occurred in August and December (i.e. that they had occurred during the course of the investigation and had been instigated by the undercover agent to assist in obtaining her conviction), if believed, may well have given the Court cause to reach a different result. As such, Ms. Nolan-Cooper's statements were material ones which "had a natural tendency to influence, or was capable of influencing, the decision of the decision-making body to which it was addressed." Kungys v. United States, 485 U.S. at 770, 108 S.Ct. at 1546. As the statements, if true, may have had a tendency to influence the decision (i.e. whether Ms. Nolan-Cooper's due process rights were violated), of the decision-making body to which the decision was addressed (i.e. this Court), they were material.
Finally, to the extent the defendant means to argue that her testimony was not material to her guilt of the crime charged in the indictment, the Court finds that the materiality requirement need not relate to the ultimate issue of innocence or guilt but rather to "influence, the decision" on the specific issue before the court. See id. The Third Circuit has upheld an adjustment for obstruction of justice where a defendant falsely testified at trial that his confession was obtained by threats, in violation of the Fifth Amendment, even though this testimony was for the purpose of asserting his constitutional rights and not directly related to the issue of his guilt. Bethancourt, 65 F.3d at 1078. Therefore, examined under any of these theories, Ms. Nolan-Cooper's statements that sexual relations occurred between her and Agent Oubre in August and December, 1994 were material. The fact that Ms. Nolan-Cooper willfully made false statements about *659 such material matters amounts to perjury, justifying the adjustment for obstruction of justice provided by U.S.S.G. § 3C1.1.
c. Adjustment for Acceptance of Responsibility
The United States Sentencing Guidelines affords a defendant who accepts responsibility two stages of downward adjustments. The initial stage, contained in U.S.S.G. § 3E1.1(a), allows for a downward adjustment of two levels when "the defendant clearly demonstrates acceptance of responsibility for [her] offense." The probation officer has recommended a downward adjustment of two levels pursuant to this initial subsection. The Court agrees with the probation officer's analysis and grants Ms. Nolan-Cooper a two level downward adjustment.
The second stage of downward adjustments is contained in U.S.S.G. § 3E1.1(b),[21] which provides an additional one level downward adjustment. The threshold requirements for this additional adjustment are that the defendant meet the qualifications for the initial adjustment, and that the adjusted offense level be sixteen or greater. Here, since Ms. Nolan-Cooper's qualified for the initial adjustment and her adjusted offense level is twenty-four, she meets the threshold requirements. The defendant must then show that she either, "(1) timely provid[ed] complete information to the government concerning [her] own involvement in the offense; or (2) timely notif[ied] authorities of [her] intention to enter a plea of guilty, thereby permitting the government to avoid preparing for trial and permitting the court to allocate its resources efficiently." U.S.S.G. § 3E1.1(b).
The probation officer did not recommend the additional one level downward adjustment under U.S.S.G. § 3E1.1(b). The defendant objects to the probation officer's failure to recommend this adjustment, contending that she met the requirements of U.S.S.G. § 3E1.1(b)(1) by giving truthful information about her culpability for the offense as early as 1995. Alternatively, she claims that she met the requirements of U.S.S.G. § 3E1.1(b)(2) by notifying the government that she intended to plead guilty prior to the government's pretrial deadline, which prevented the government from taking the case to trial and saved judicial resources.[22] The Court concludes that the defendant is not entitled to the additional one level downward adjustment under either U.S.S.G. § 3E1.1(b)(1) or (b)(2).
The Third Circuit has held the issue of "[w]hether a defendant has `accepted responsibility' is a factual matter reviewed under a `clearly erroneous' standard." United States v. DeLeon-Rodriguez, 70 F.3d 764, 767 (3d Cir.1995), cert. denied, ___ U.S. ___, 116 S. Ct. 1343, 134 L. Ed. 2d 492 (1996). The "defendant bears the burden of establishing by a preponderance of the evidence that a reduction under this provision is warranted." Id.
The defendant contests that she never challenged her factual guilt, but rather merely asserted her constitutional right to due *660 process by filing a motion to dismiss for outrageous government conduct. The defendant contemplates that the reason she would not receive the additional one level downward adjustment under U.S.S.G. § 3E1.1(b) is that she filed a motion to dismiss her indictment on due process grounds. Ms. Nolan-Cooper claims that denying her a downward adjustment on such grounds would be tantamount to penalizing her for asserting her constitutional rights.
The defendant relies on Application Note 2 to U.S.S.G. § 3E1.1, which provides, in part, that even where a defendant goes to trial, she is not precluded from receiving a downward adjustment for acceptance of responsibility solely by asserting a constitutional right:
In rare situations a defendant may clearly demonstrate an acceptance of responsibility for his criminal conduct even though he exercises his constitutional right to trial. This may occur, for example, where a defendant goes to trial to assert and preserve issues that do not relate to factual guilt (e.g. to make a constitutional challenge to a statute or a challenge to the applicability of a statute to his conduct).
App. Note 2 to U.S.S.G. § 3E1.1.
The Third Circuit has acknowledged the applicability of Application Note 2 in DeLeon-Rodriguez, 70 F.3d at 767, where it observed that a defendant should not be precluded from the initial two level downward adjustment available under U.S.S.G. § 3E1.1(a) when the defendant goes to trial to preserve issues not related to factual guilt. Id.[23] However, the Third Circuit has not directly addressed the issue of whether the same reasoning should apply when a court considers a one level downward adjustment pursuant to U.S.S.G. § 3E1.1(b). In United States v. Kimple, 27 F.3d 1409 (9th Cir.1994), the Ninth Circuit held that the district court erred when it refused the one level reduction available under § 3E1.1(b) based on the defendant's motion to suppress evidence on Fourth Amendment grounds: "a defendant's exercise of [her constitutional] rights should not in and of itself preclude a reduction for timely acceptance." Id. at 1413.[24] In the absence of Third Circuit precedent, the Court will, for the purposes of this hearing, assume that the defendant is not precluded from receiving the additional one level reduction for acceptance of responsibility simply because she asserted that her right to due process had been violated.
Nevertheless, the Court concludes that Ms. Nolan-Cooper is not entitled to the adjustment because it finds that Ms. Nolan-Cooper did not fulfill the mandate of either U.S.S.G. § 3E1.1(b)(1) (timely provided complete information to the government about her own involvement) or (b)(2) (timely notified the government of her intent to plead guilty). First, the Court notes that timeliness is a requirement explicitly set out in both U.S.S.G. § 3E1.1(b)(1) and (b)(2). In fact, the concept of "timeliness" distinguishes between the award of the initial two level downward adjustment provided by U.S.S.G. § 3E1.1(a) and the additional one level adjustment provided by U.S.S.G. § 3E1.1(b). *661 As was noted recently by the Ninth Circuit in United States v. Eyler, 67 F.3d 1386, 1390-91 (9th Cir.1995): "While the key inquiry for purposes of section [3E1.1](a) is whether the defendant has demonstrated contrition, once this has been determined, then the focus of section [3E1.1](b) inquiry is on timeliness." Indeed, Application Note 6 to U.S.S.G. § 3E1.1 observes that, as compared to conduct qualifying for the initial two level downward adjustment under U.S.S.G. § 3E1.1(a), "[i]n general, the conduct qualifying for a decrease in offense level for subsection (b)(1) or (2) will occur particularly early in the case."
In addressing Ms. Nolan-Cooper's claim that she is entitled to the additional one level adjustment provided by U.S.S.G. § 3E1.1(b)(1), the Court acknowledges that the defendant provided some truthful information to law enforcement authorities about the offense as early as 1995. Information provided this early would ordinarily be considered to meet the timeliness requirement if it indeed acknowledged fully the defendant's culpability. Whether, in providing this early information, Ms. Nolan-Cooper acknowledged her culpability touches on whether the information Ms. Nolan-Cooper provided the government was "complete information ... concerning [her] own involvement in the offense." See U.S.S.G. § 3E1.1(b)(1). The Court finds that Ms. Nolan-Cooper has failed to demonstrate that the information she provided met this standard. Instead, the Court concludes that Ms. Nolan-Cooper gave false information in order to reduce her culpability and, therefore, failed to fully acknowledge her own involvement in the offense.
The Ninth Circuit has held that where a "defendant lies about the offense conduct or `relevant' conduct, the lies are evidence which the district court can weigh against acceptance of responsibility." United States v. Vance, 62 F.3d 1152, 1160 (9th Cir.1995). In distinguishing between relevant conduct and irrelevant conduct, the Ninth Circuit found that if the defendant lied about the "reason or motivation for committing a crime [it] is [not] a dispositive factor in determining whether to grant the adjustment unless the claim was intended as a defense to liability for the charged offense." United States v. Gonzalez, 16 F.3d 985, 991 (9th Cir.1993). However, the Gonzalez court contrasted that situation to a case in which the defendant sought to avoid responsibility by claiming that he was coerced into committing the offense. Id. at 991 n. 3 (citing United States v. Smith, 905 F.2d 1296 (9th Cir.1990)). The Gonzalez court agreed with the Smith court's holding that a false claim by the defendant that he was coerced indicated that he had not accepted responsibility for his offense. Id.
In this case, the Court has found that Ms. Nolan-Cooper testified falsely at the pretrial hearing. It concluded that the testimony was willfully made and concerned material matters. It now concludes that the false testimony involved relevant conduct. Like Smith, Ms. Nolan-Cooper tried to escape responsibility by arguing that the undercover agent's sexual overtures toward her, at the very least, contributed to her criminal conduct.[25] She testified falsely that sexual encounters had taken place in August and December of 1994, a time when the conspiracy was ongoing. Her argument that Agent Oubre's conduct was a contributing factor in her decision-making calculus as to whether to engage in or continue her criminal conduct is akin to Smith's arguments that "he did not participate in the robbery of his own desire, but did so out of fear for Banks [his codefendant]." Smith, 905 F.2d at 1302. Therefore, a downward adjustment of one level is not appropriate under U.S.S.G. § 3E1.1(b)(1) because, by lying about relevant conduct, Ms. Nolan-Cooper did not provide timely and complete information of her involvement in the offense.
In considering her claim for a downward adjustment under subsection (b)(2), the Court must determine whether Ms. Nolan-Cooper "timely notified authorities of [her] intention to enter a plea of guilty." U.S.S.G. § 3E1.1(b)(2). In this case, Ms. Nolan-Cooper was indicted on September 19, 1995 and *662 pled not guilty at her arraignment on October 5, 1995. She did not enter a guilty plea until October 30, 1996, more than one year later. The Court weighs this delay as evidence militating against a finding that Ms. Nolan-Cooper's acceptance of responsibility was timely. The delay alone, however, does not preclude a finding of timeliness under U.S.S.G. § 3E1.1(b)(2) because, as the Fifth Circuit has observed, the term timely acceptance under this subsection is "functional, not exclusively temporal." United States v. Williams, 74 F.3d 654, 656 (5th Cir.1996). The Court is thus required to analyze whether Ms. Nolan-Cooper's acceptance of responsibility was functionally timely for purposes of U.S.S.G. § 3E1.1(b)(2).
The functional purpose of the additional one level downward adjustment of U.S.S.G. § 3E1.1(b)(2) is to provide an incentive for a guilty defendant to enter a guilty plea so that "(1) the government avoids needless trial preparation, and (2) the court is able to allocate its resources efficiently." Id. Here, Ms. Nolan-Cooper waited until five days before trial to enter her plea. On this basis alone it is difficult to imagine how her acceptance of responsibility helped the government avoid any significant amount of trial preparation. See United States v. Wetwattana, 94 F.3d 280, 285-86 (7th Cir.1996) (denying a one point downward adjustment under § 3E1.1(b)(2) where the defendant did not indicate his attention to plead guilty until eight months after arraignment and only five days before trial was to begin, also listing cases denying the adjustment on similar grounds); United States v. Covarrubias, 65 F.3d 1362, 1367-68 (7th Cir.1995) (denying a subsection (b)(2) adjustment where the defendant "did not inform the government that he would be pleading guilty in the event [his] suppression motion was denied. Had he done so, the government could have avoided preparing for his trial because the motion to suppress would have destroyed the government's case.") Moreover, had the defendant advised the Court of her desire to enter a guilty plea at an earlier stage, the Court may also have been able to schedule other proceedings on the dates it had slated for the trial. See, e.g., Covarrubias, 65 F.3d at 1367-68 (observing that the defendant's eleventh hour "guilty plea ... did [not] permit the district court to allocate its resources efficiently."). Therefore, the Court finds that Ms. Nolan-Cooper is not entitled to the additional one level downward adjustment provided by U.S.S.G. § 3E1.1(b)(2).
B. Motions for Downward Departure
1. Government's Misconduct Takes Case Out of Heartland
Ms. Cooper seeks a downward departure under U.S.S.G. § 5K2.0 asserting that the outrageous conduct of the government takes this case out of the heartland. See Koon v. United States, ___ U.S. ___, 116 S. Ct. 2035, 135 L. Ed. 2d 392 (1996). The conduct Ms. Nolan-Cooper advances as the reason for departure is the sexual relations that occurred between Ms. Nolan-Cooper and Agent Oubre on the early morning of February 18, 1995.
The Court recounts its findings regarding the night of February 17 and morning of February 18, 1995. On the evening of February 17, 1995, Agent Oubre along with IRS Special Agent Henry Jolly,[26] were scheduled to go out to dinner with Ms. Nolan-Cooper, her friend Donita Nero and several other individuals including suspected coconspirators. The record indicated that Agent Jolly had previously expressed an in Ms. Nero, an interest that Agent Oubre passed on to Ms. Nolan-Cooper.
The afternoon of the scheduled dinner, Agent Oubre was informed by Ms. Nolan-Cooper that the other individuals expected to attend had cancelled, and that only she and Ms. Nero would attend. Agent Oubre communicated this information to his supervisors, who urged him to cancel the dinner. Agent Oubre protested, explaining that a cancellation might make Ms. Nolan-Cooper angry, and, although the investigation was nearly completed regarding her, it might endanger her role as an intermediary between *663 the agent and other coconspirators who where still under investigation.
The supervisory agents allowed the dinner to go on as scheduled but required Agent Oubre and Agent Jolly to return for debriefing early in the evening, as soon as the meal was over. As directed, the two agents returned to the hotel for debriefing. After the agents' supervisors had left for the evening, the agents went out, first to a center city nightclub, and then to Quincy's, a nightclub located several miles from center city Philadelphia where the agents met Ms. Nolan-Cooper and Ms. Nero.[27]
Shortly after the agents met Ms. Nolan-Cooper and Ms. Nero at Quincy's the four-some returned to the agents' three room suite at the Four Seasons Hotel. There, the group talked and drank wine into the early morning hours of February 18, 1995. At the hearing, Ms. Nero testified that while she and Agent Jolly talked in the living room, Ms. Nolan-Cooper and Agent Oubre went into Agent Oubre's bedroom, where they stayed behind closed doors for approximately forty-five minutes. According to Ms. Nero, when Agent Oubre and Ms. Nolan-Cooper emerged from the bedroom Agent Oubre was wearing different pants. Ms. Nolan-Cooper testified that sexual relations occurred between her and Agent Oubre during this time. Agent Oubre denied this allegation.
Not long after Agent Oubre and Ms. Nolan-Cooper rejoined Agent Jolly and Ms. Nero in the living room of the suite, the women left the hotel to return to their respective homes. Ms. Nero testified that Agent Jolly arrived at her home shortly after daybreak and she had sexual relations with him at that time.[28]
The Court concluded that Agent Oubre attempted to cover up Agent Jolly's absence that morning when he talked to his superiors. He testified at the hearing that, although he had told Agent Dollard that Agent Jolly was with him at the hotel, he had not actually seen Agent Jolly. Telephone records show phone calls between Agent Oubre's cellular phone and Agent Jolly's. From this evidence, the Court found that Agent Oubre was aware that Agent Jolly was not in the room and that the reason Agent Oubre did not contact his supervisor until noon on Saturday, February 18, some ten hours after meeting Ms. Nolan-Cooper and Ms. Nero, was to have time to coordinate with Agent Jolly a cover story, before they met with their supervisors.
In considering the credibility of Agent Oubre's testimony, the Court found compelling the fact that although he has the opportunity to do so, Agent Oubre did not notify his supervisors of the purported chance meeting with the key target of an important investigation until at least ten hours after the incident, that he denied making phone calls to Agent Jolly which appeared on his phone records, and that he mislead his supervisors as to Agent Jolly's whereabouts.
Lacking an eyewitness, the Court had to resolve the conflict between Ms. Nolan-Cooper's allegation that sexual relations had occurred against Agent Oubre's flat denial. In doing so, the Court gave weight to the following factors: 1) Agent Oubre had planned the evening; 2) Agent Oubre had resisted its cancellation once it was suggested by his *664 supervisors; 3) Agents Oubre and Jolly had arranged to meet with Ms. Nolan-Cooper and Ms. Nero at Quincy's; 4) Agent Oubre failed to report spending several hours with a key target of the investigation to his supervisors for at least ten hours; 5) Agent Oubre misrepresented to his supervisors Agent Jolly's whereabouts; 6) Agent Oubre had a motive to fabricate based on the potential harm discovery of the incident could do to the investigation and his employment; 7) the corroborating testimony of Ms. Nero, a witness who was not impeached and who had no apparent motive to fabricate,[29] that Ms. Nolan-Cooper and Agent Oubre were alone in Agent Oubre's bedroom and that Agent Oubre had emerged from the room wearing different pants; and 8) Ms. Nolan-Cooper's strong motive to fabricate. The Court concluded that it was more likely than not that sex between Ms. Nolan-Cooper and Agent Oubre did indeed take place in the predawn hours of February 18, 1995 during the time that Agent Oubre and Ms. Nolan-Cooper were alone in Agent Oubre's bedroom in the agents' suite at the Four Seasons Hotel. Because of the circumstances of the sexual encounter, however, and as discussed above, the Court, concluded that the agents' conduct, while reprehensible,[30] did not rise to the level of a due process violation.
The defendant now asks the Court to regard the agent's sexual misconduct, subsequent cover up, and false testimony at the hearing on the defendant's motion to dismiss, as factors which take the case out of the heartland, justifying a downward departure. The Supreme Court has recently held that where, as here, the sentencing court encounters "a factor unmentioned in the Guidelines," the Court must, "after considering the `structure and theory of both relevant individual guidelines and the Guideline taken as a whole, decide whether it is sufficient to take the case out of the Guideline's heartland." Koon, ___ U.S. at ___, 116 S.Ct. at 2045 (citation omitted). The Supreme Court admonished, however, that "[t]he court must bear in mind the Commission's expectation that departures based on grounds not mentioned in the Guidelines will be `highly infrequent.'" Id. (citation omitted).
The defendant argues that the Court's finding that Agent Oubre's conduct did not rise to the level of a due process violation does not preclude a finding that the case falls outside the heartland. For support, the defendant cites United States v. Egemonye, 62 F.3d 425 (1st Cir.1995), which holds that a court may downward depart based on government misconduct which does not reach the level of a due process violation. The reasoning of this case has, in fact, been cited favorably in two recent Eastern District of Pennsylvania cases. See United States v. Kaczmarski, 939 F. Supp. 1176, 1181 (E.D.Pa. 1996); United States v. Perez, Crim.A. No. 94-0192-01, 94-0192-10, 1996 WL 502292, at *7 (E.D.Pa. Aug. 27, 1996).
The Court agrees that a due process violation is not necessary to take a case out of the heartland. However, as the government aptly points out, the cases cited by the defendant involved the alleged sentencing factor manipulation, and not the type of misconduct countenanced by the defendant's argument under this section. A downward departure for sentencing manipulation is rooted in a finding that the government engaged in improper conduct that has the effect of increasing the defendant's sentence. In fairness, courts see fit to remedy such a situation by reducing the sentence the number of levels that it was impermissibly increased. See, e.g., Egemonye, 62 F.3d at 427 (finding "`where government agents have improperly enlarged the scope or scale of the crime,' the sentencing court has the power to *665 exclude `the tainted transaction' from the guideline computations" (quoting United States v. Montoya, 62 F.3d 1, 3 (1st Cir. 1995)).
Here, there is no such logical nexus. The Court has already concluded that Ms. Nolan-Cooper was not induced to commit or enlarge the crime as a result of Agent Oubre's engaging in sexual relations with her. In fact, all counts against Ms. Nolan-Cooper that stemmed from actions taken by her after the incident are to be dismissed by the government at sentencing, pursuant to the plea agreement.[31] To base a downward departure on the defendant's reasoning would result in a sentencing windfall to the defendant for no logical or policy rationale.[32]
Therefore, the Court concludes that Ms. Nolan-Cooper should be sentenced in accordance with the crime to which she has pled guilty. None of the purposes of the current sentencing scheme would be served by this departure.[33] Absent a due process violation or a showing that the government misconduct enlarged the scope or scale of a crime, and resulted in an increased sentence, a departure is not warranted.
2. Sentencing Factor Manipulation
The defendant asserts that a downward departure is warranted because the government determined the amount of money to be laundered, not Ms. Nolan-Cooper. She claims that this "constitutes improper sentencing factor manipulation and otherwise takes the case outside the guideline's heartland." Def.Sent.Mem. at 8.
"Sentencing manipulation occurs when the government engages in improper conduct that has the effect of increasing a defendant's sentence." United States v. Okey, 47 F.3d 238, 240 (7th Cir.1995), quoted in, Kaczmarski, 939 F.Supp. at 1180. The Third Circuit has not addressed the theory of sentencing manipulation. See Perez, 1996 WL 502292, at *6. Two recent Eastern District of Pennsylvania cases, while noting that the defense is not available at all in the Seventh and Eleventh Circuits, have utilized the standard set out by the First Circuit in United States v. Egemonye, 62 F.3d 425 (1st Cir.1995). See, Kaczmarski, 939 F.Supp. at 1181; Perez, 1996 WL 502292, at *7.
In Egemonye, the First Circuit held that "`where government agents have improperly enlarged the scope or scale of the crime,' the sentencing court has the power to exclude `the tainted transaction' from the guideline computations." Egemonye, 62 F.3d at 427 (quoting United States v. Montoya, 62 F.3d 1, 3 (1st Cir.1995)). While the First Circuit held that "something less than a constitutional violation might suffice," sentencing manipulation could not be found absent "extraordinary misconduct." Id. at 427. See also Kaczmarski, 939 F.Supp. at 1181; Perez, 1996 WL 502292, at *7.
In Kaczmarski, the defendant received stolen checks from a government informant and deposited them in bogus bank accounts opened using forged identification in the *666 name of the check recipient. Funds in the amount of the stolen checks were then intended to be withdrawn from the banks as cash. Kaczmarski was sentenced based on $104,000, the entire amount of the stolen checks.
Judge Dalzell found this amount appropriate for sentencing because the defendant intended to defraud the bank of $104,000, even though the government itself provided that specific amount in stolen checks, and the defendant only successfully cashed one check in the amount of $9,800. The court based its finding on the evidence that the defendant had encouraged the government operative to supply him with $100,000 in stolen checks, the defendant orchestrated the scheme, and the government "did not engage in `extraordinary misconduct' or `improperly enlarge[] the scope or scale of the crime.'" Kaczmarski, 939 F.Supp. at 1182.
In United States v. Rusznica, 939 F. Supp. 1183 (E.D.Pa.1996), Kaczmarski's codefendant was charged with bank fraud amounting to $18,400, the amount of the two checks he was asked to cash. However, he only successfully cashed one check for $9,800. The court held that he should only be sentenced for the amount of $9,800, even though he intended the higher amount, because that was the amount of the actual loss, and that the higher amount would overstate the offense. Rusznica, 939 F.Supp. at 1185 (citing U.S.S.G. § 2F1.1 Application Note 10).[34] The court reached this conclusion because the higher loss figure came from the government's operative and the defendant was only a peripheral participant who did not coordinate the scheme or approve the amounts to be taken, as other codefendants did. It is an important distinction to note that the court found that the $9,800 amount, which was set by the government, was not an unreasonable one nor was it manipulated by the government for sentencing purposes. Id.
Unlike Rusznica, Ms. Nolan-Cooper did not merely have the intention of laundering over $100,000 in purported drug proceeds, she was responsible for actually laundering over $190,000. She was also not a peripheral participant, she was the orchestrator of the money laundering conspiracy. She is arguably more like Kaczmarski, who had the intention of laundering far more of the purported drug proceeds. But unlike Kaczmarski, she is not being charged with any funds beyond those that were actually laundered.
In Egemonye, the defendant was targeted in a sting operation. He purchased stolen credit cards from an undercover state trooper, forged identification documents and obtained cash advances on the cards from banks. The case involved four stolen credit card purchases. The first three transactions involved three or four credit cards with aggregate credit limits of $7,450 to $21,000 for each transaction. The final transaction included forty credit cards with an aggregate limit of over $200,000. Egemonye, 62 F.3d at 426. At sentencing, the defendant was sentenced based on a loss of $242,950. The defendant appealed, claiming that the final transaction was sentencing factor manipulation to increase his sentence. Id. at 427. The First Circuit upheld the sentence, concluding that no extraordinary misconduct took place despite the fact that the last transaction involved a sizeable jump, and finding "the sting operation involved no pressure whatever on the Egemonye, lasted for only four transactions, and garnered several other defendants." Id. at 428.
Following the rationale in Egemonye, there is no evidence that the undercover agent pressured Ms. Nolan-Cooper to engage in the money laundering, or influenced her to launder more money than she was ordinarily willing to launder. Indeed, from the first meeting with the undercover agent she was a willing participant in the money laundering scheme and readily acknowledged that it would involve a significant amount of money to be laundered over an extended period of time. Additionally, the government, had a legitimate law enforcement purpose *667 in continuing the money laundering operation, i.e. identifying and rooting out more coconspirators. The Court concludes that this thirteen month investigation which involved the laundering of nearly $200,000 was neither extended nor expanded for improper purposes and, therefore, the government did not engage in conduct even approaching the "extraordinary misconduct" required to show sentence factor manipulation.
IV. CONCLUSION
The Court finds that Ms. Nolan-Cooper used special skills in the offense and obstructed justice and, therefore, overrules the defendant's objections to the PSI report's recommendation for upward adjustments based on those grounds. The Court finds that Ms. Nolan-Cooper is not entitled to an additional downward adjustment of one level for acceptance of responsibility and, therefore, overrules the defendant's objection to the PSI report's failure to recommend such an adjustment.[35] Finally, the Court denies the defendant's motion for a downward departure, finding that the conduct of the government did not take this case out of the Guideline's heartland, and the government did not engage in sentencing factor manipulation.
NOTES
[1] Other objections the defendant has raised are: 1) the use of the terms "fraudulent business" and "sham business" in the PSI report when referring to the business Ms. Nolan-Cooper incorporated for the undercover agent to launder money through; 2) allegedly misleading paragraphs concerning Ms. Nolan-Cooper's role in and remuneration for the sale of a car from Ben Goff to the undercover agent which was illegally titled under a fictitious name; and 3) the failure of the probation officer to include a paragraph describing the Court's findings that the undercover agent engaged in sexual relations with the defendant on February 18, 1995. The Court finds these objections to be meritless.
[2] The Court has reviewed the following pleadings and material: 1) the presentence investigation report prepared by the probation officer; 2) the guilty plea agreement between defendant and the government; 3) the government's guilty plea memorandum; 4) the government's sentencing memorandum; 5) the defendant's sentencing memorandum and motion for downward departure; 6) notes of testimony from the pretrial hearing (Sept. 5, 6, 9, 10, 12 & 13, 1996); 7) the transcript of the oral argument and the Court's findings of fact and conclusions of law (Oct. 4, 1996); and 8) transcripts of the recordings made during the undercover operation.
[3] Agent Oubre discussed with Ms. Nolan Cooper that his money came from drugs twice during the initial meeting. "I'm sure if they dug hard enough, and just tried to look at me, you know, somebody must have to say something.... They'll link me to drugs." Id. at 28-29. "I want to enjoy it [the money] now.... and right now I can't because as soon as I come out ... as soon as I show somebody twenty-five thousand dollars, they are gonna know it's from drugs." Id. at 32. To which Ms. Nolan Cooper responded: "Well, they're gonna assume it's from drugs, but if you can show that it's from another source ..." Id.
[4] Just after the introductions, the conversation went as follows:
L.R.: What has OZZIE told you about me so far?
A.C.: That you were ... you had some business in that ... that you wanted to discuss.
. . . . .
L.R.: ... I'll just start from the beginning. Why we're here. Uh ... I got a lot of cash.
A.C.: Um hmm.
L.R.: ... I need to get it to look legitimate.
A.C.: So you want to set up a business?
L.R.: I don't know.... OZZIE told me you could help me with some ideas.
A.C.: ... there's several things you could do.
L.R.: Uh huh.
A.C.: I mean, you could take it someplace and hide it.
L.R.: Uh huh.
A.C.: ... other clients that I have ... they put money away in other places, like in the Bahamas.
Id. at 1-2 (L.R. refers to Agent Oubre in his undercover capacity as Louis Richard. A.C. refers to defendant Angela Nolan-Cooper.).
[5] She later explained to him the process of structuring transactions to avoid IRS reporting requirements. When Agent Oubre asked Ms. Nolan-Cooper if she could get bank checks for him right away so he could move around more easily (because he liked to carry fifteen to twenty-thousand dollars with him), she said "you'd have to do it over a period of time.... because under the law, you can't deposit more than a certain amount of cash without filing a certain form with the bank.... you can't deposit more than ten thousand dollars in cash.... without filing the form that goes directly to the IRS." Id. at 24-26.
[6] Ms. Nolan-Cooper explained to Agent Oubre:
[O]ne thing ... I can do for you as an attorney, is that all of my funds in my escrow account ... they really can't trace them ... they can trace 'em but they don't question 'em like they do somebody's personal account.... So that's a resource. I mean, I don't like to hold money there for a long time ... but I can pass money through that.... Keep them [the deposits] small and slow.... up to like ten, twelve thousand a month.... You can do it that way, and then start to funnel the money, you know, if you want it to go in the bank here.... Or, if you want it to go in the bank down there [the Bahamas].
Id. at 17-19.
[7] Mr. Henderson and Mr. Mikell were indicted as co-conspirators but the charges were subsequently dropped.
[8] The defense of outrageous government conduct was spawned by dicta in the case of United States v. Russell, 411 U.S. 423, 431, 93 S. Ct. 1637, 1642, 36 L. Ed. 2d 366 (1973), where the Court commented: "We may some day be presented with a situation in which the conduct of law enforcement agents is so outrageous that due process principles would absolutely bar the Government from invoking judicial process to obtain a conviction." Russell, 411 U.S. at 431-32, 93 S.Ct. at 1643. The Supreme Court considered this defense after finding that the defendant could not invoke the defense of entrapment because he clearly showed a predisposition for the crime which therefore barred him from using the entrapment defense. Id.
In 1978, the Third Circuit applied the doctrine of outrageous government conduct to dismiss a conviction on due process grounds. United States v. Twigg, 588 F.2d 373 (3d Cir.1978). While it has not so applied the doctrine since, the Third Circuit has continued to utilize its reasoning. See, e.g., United States v. Jannotti, 673 F.2d 578 (3d Cir.), cert. denied, 457 U.S. 1106, 102 S. Ct. 2906, 73 L. Ed. 2d 1315 (1982), 469 U.S. 880, 105 S. Ct. 243, 244, 83 L. Ed. 2d 182 (1984); United States v. Voigt, 89 F.3d 1050, 1070 (3d Cir.), cert. denied, ___ U.S. ___, 117 S. Ct. 623, 136 L. Ed. 2d 546 (1996). For a discussion of the Court's decision denying the defendant's motion to dismiss the indictment, see Hearing Tr. of Oct. 4, 1996 at 80-106.
[9] The balance of this memorandum represents a slightly edited version of the Court's decision delivered from the bench at sentencing.
[10] U.S.S.G. § 3B1.3 provides:
If the defendant abused a position of public or private trust, or used a special skill, in a manner that significantly facilitated the commission or concealment of the offense, increase by 2 levels.... If this adjustment is based upon an abuse of trust, it may be employed in addition to an adjustment under § 3B1.1 (Aggravating Role); if this adjustment is based solely on the use of a special skill, it may not be employed in addition to an adjustment under § 3B1.1 (Aggravating Role).
[11] The probation officer did not consider an adjustment under U.S.S.G. § 3B1.1, which would add four levels based on the defendant's aggravating role as "an organizer or leader of a criminal activity that involved five or more participants." U.S.S.G. § 3B1.1(a). Nor did the government, consistent with the plea agreement, recommend such an adjustment. While the Court will not occasion delay in the sentencing by injecting sua sponte the possibility of the adjustment in the sentencing calculus, the Court ponders why such an adjustment was not considered by the probation officer. See United States v. Bass, 54 F.3d 125 (3d Cir.1995).
Application Note 4 to this section lists as "[f]actors the court should consider [for a leadership role] ... the exercise of decision making authority, the nature of participation in the commission of the offense, the recruitment of accomplices, the claimed right to a larger share of the fruits of the crime, the degree of participation in planning or organizing the offense, the nature and scope of the illegal activity, and the degree of control and authority exercised over others."
Here, Ms. Nolan-Cooper had decision making authority, was the primary participant in the offense, recruited numerous accomplices, and exercised considerable control and authority over at least five others. Under these circumstances, while a two level adjustment for her use of a special skill is certainly appropriate, a four level increase as an organizer or a leader appears to be more in line with the defendant's role in the offense.
[12] In the plea agreement, the government agreed not to comment on any adjustment for use of special skill.
[13] U.S.S.G. § 3C1.1 provides:
If the defendant willfully obstructed or impeded, or attempted to obstruct or impede, the administration of justice during the investigation, prosecution, or sentencing of the instant offense, increase the offense level by 2 levels.
Application Note 3 to this section lists examples of conduct that this enhancement would apply to, including "(b) committing, suborning, or attempting to suborn perjury."
[14] Pursuant to the plea agreement, the government does not comment on the applicability of this adjustment.
[15] The three IRS agents assigned to surveillance who testified regarding the events of the August 12 and 13 are Agent John Lafferty, Agent Kelvin Bowser, and Agent Robert Walker.
[16] Agent Walker testified that he was on surveillance that evening with Agent Dollard. He confirmed Agent Dollard's testimony that the agents had observed Agent Oubre and Angela Nolan-Cooper arrive at the hotel at approximately 2:00 a.m. He thereafter left, at Agent Dollard's direction. The agents had been alerted by Agent Oubre that hotel employees had warned him that he might be under investigation by police because he was frequently followed by several men after returning to the hotel. Out of concern for Agent Oubre's cover, Agent Dollard ordered Agent Walker and another agent to return home while he and Customs Agent Michalewjik (phonetic) debriefed Agent Oubre.
[17] The Court's finding was supported by a recorded phone conversation the following day between Agent Oubre and Ms. Nolan-Cooper disclosing that Agent Oubre stated to Ms. Nolan-Cooper "After I left you, I was coming back here and I said hey, I want to get me a cheese steak." The Court took into account the defendant's argument that Agent Oubre's memorandum of daily activities for that night failed to note that he met with Agent Dollard and Agent Michalewjik after the conclusion of the assignment that night. The Court found that the absence of a notation concerning these activities constituted a scrivener's error, an oversight on the part of Agent Oubre that did not materially affect the Court's conclusion.
[18] 18 U.S.C. § 1621 provides:
Whoever
(1) having taken an oath before a competent tribunal, officer, or person, in any case in which the law of the United States authorizes an oath to be administered, that he will testify, declare, depose, or certify truly or that any written testimony, declaration, deposition, or certificate by him subscribed, is true, willfully and contrary to such oath states or subscribes any material matter which he does not believe to be true ...
. . . . .
is guilty of perjury....
[19] In Kungys, the Supreme Court considered an appeal of a revocation of citizenship based on appellant's material misrepresentations to immigration officials in violation of 8 U.S.C. § 1451(a). The Court noted that it was adopting the same definition of material used for other statutes, including criminal perjury prosecutions under 18 U.S.C. § 1621.
[20] In Cuervelo, the Second Circuit held:
In addressing the question as to whether an indictment must be dismissed based upon outrageous governmental misconduct when a sexual relationship between a defendant and a governmental agent has been shown to exist, we believe that, at a minimum, the defendant must show: (1) that the government consciously set out to use sex as a weapon in its investigatory arsenal, or acquiesced in such a conduct for its own purposes upon learning that such a relationship existed; (2) that the government agent initiated a sexual relationship, or allowed it to continue to exist, to achieve governmental ends; (3) that the sexual relationship took place during or close to the period covered by the indictment and was entwined with the events charged therein.... Once those facts are found ... we can then proceed to determine whether any violation of due process standards has occurred.
Cuervelo, 949 F.2d at 567.
[21] U.S.S.G. § 3E1.1(b) provides:
If the defendant qualifies for a decrease under subsection (a), the offense level determined prior to the operation of subsection (a) is level 16 or greater, and the defendant has assisted authorities in the investigation or prosecution of his own misconduct by taking one or more of the following steps:
(1) timely providing complete information to the government concerning his own involvement in the offense; or
(2) timely notifying authorities of his intention to enter a plea of guilty, thereby permitting the government to avoid preparing for trial and permitting the court to allocate its resources efficiently,
decrease the offense by 1 additional level.
[22] In the plea agreement, the government and defendant stipulated to a two level reduction for acceptance of responsibility. At that time, the government and defendant envisioned the plea agreement's stipulated guideline range of 41 to 51 months, which included only the two level adjustment for acceptance of responsibility.
After the presentence report's recommendation of a higher guideline range (i.e. 63 to 78 months) based on adjustments for special skill and obstruction of justice, the defendant asked the government to consider an additional one point downward adjustment. Gov't.Sent.Mem. at 5. A government review of the issue "at the supervisory level" lead the government to agree not to oppose the defendant's request for an additional downward adjustment of one level. Id.
[23] The Third Circuit concluded that the defendant in DeLeon-Rodriguez was not eligible for the two level downward adjustment, available under U.S.S.G. § 3E1.1(a), because he went beyond preserving issues of law and contested his factual guilt.
[24] In light of these two cases, the defendant's reliance on United States v. Sneed, 814 F. Supp. 964 (D.Colo.1993), aff'd, 34 F.3d 1570 (10th Cir. 1994), is both unnecessary and misplaced. In Sneed, a defendant who had tendered a conditional offer to plead guilty, pending the outcome of his codefendants' motion to dismiss, was granted the initial downward adjustment of two levels under U.S.S.G. § 3E1.1(a) even though he went to trial. The judge concluded that the defendant was eligible for the two level adjustment because he did not minimize his factual guilt and it was clear he only went to trial to preserve the constitutional issue. Sneed, 814 F.Supp. at 977-78.
Sneed is rendered unnecessary by DeLeon-Rodriguez, which sets the standard in the Third Circuit for a downward adjustment under U.S.S.G. § 3E1.1(a) where a defendant asserts a constitutional challenge to his prosecution. It is misplaced because it is based on the initial two level downward adjustment provided by U.S.S.G. § 3E1.1(a), which is not at issue in this case. Kimple specifically addresses the availability of the additional one level downward adjustment provided by U.S.S.G. § 3E1.1(b), and held that the adjustment is available where a defendant has challenged his prosecution solely on constitutional grounds. Kimple, 27 F.3d at 1413.
[25] Whether the agent's sexual conduct with Ms. Nolan-Cooper entitled her to a downward departure is discussed infra at section III.B.1.
[26] Agent Jolly came into the investigation in an undercover capacity several months after its inception to pose as "Tony Jones" a bodyguard and confidant to Agent Oubre.
[27] Agent Oubre testified that there was no agreement to meet Ms. Nolan-Cooper and Ms. Nero at Quincy's. However, the circumstances of the meeting indicate it was planned. At dinner, the agents discussed with the women the possibility of meeting up with them later in the evening. The women indicated that they would go to the club Quincy's at the Adams Mark Hotel, located on City Line Avenue. Agent Oubre testified that other locations were mentioned and the last thing the women said before leaving the Four Seasons Hotel was that they were going to a friend's house. The Court concluded that it was unlikely, in the absence of an anticipated appointment with the two women, that Agent Oubre and Agent Jolly would have travelled several miles from their center city hotel to City Line Avenue, arriving there a shortly before Quincy's was scheduled to close. The Court, thus, found that Agent Oubre's testimony that the meeting with Ms. Nolan-Cooper and Ms. Nero was a chance meeting, and that he and Agent Jolly went to Quincy's because it was one of the few nightclubs in the Philadelphia area that catered to a largely African-American clientele, was not credible.
[28] Agent Jolly was called as a witness by the defendant at the hearing. It was stipulated that, if asked about these events, Agent Jolly would invoke the Fifth Amendment.
[29] Ms. Nero, while a social acquaintance of Ms. Nolan Cooper, had no apparent motive to lie. Her testimony cast her in an unfavorable light and, if proven false, would have opened her to substantial criminal penalties.
[30] The Court finds "reprehensible" that the two government agents used government funds to finance the entertainment of a target of the investigation and her friend without any apparent investigative purpose. As discussed in the Court's findings of October 4, 1996, Hearing Tr. at 80-106, no case holds that sexual relations between an undercover agent and a target are never permissible. The Court's condemnation of the sexual relations, which the Court found occurred in this case, should not be construed as seeking to establish such a bright line.
[31] Indeed, among the several charges dismissed by the government are the drug charges, which carry the stiffest penalties, including a ten year mandatory minimum. The Court recognizes that the bulk of the actions supporting these charges occurred after the government misconduct. The defendant, therefore, may already have received the benefit she seeks from the agent's misconduct by this avoidance of exposure to the severe penalties under the drug charges.
[32] While it may be reasonable to think, indeed to expect, that the type of conduct which the Court found to have occurred in this case would ordinarily result in disciplinary action against the rogue agents, such is not for the Court to ponder. As Justice Story said in a different context comparing the allocation of responsibilities between the judiciary and the executive branches under our tripartite system of government: "The Court has done its duty, let [the officials of the executive branch] do theirs." 2 Life and Letters of Story 83, quoted in Jean Edward Smith, John Marshall: Definer of the Nation at 518 & n. 182 (1996).
[33] The purposes of sentencing are
(A) to reflect the seriousness of the offense, to promote respect for the law, and to provide just punishment for the offense;
(B) to afford adequate deterrence to criminals;
(C) to protect the public from further crimes of the defendant; and
(D) to provide the defendant with needed educational or vocation training, medical care, or other correctional treatment in the most effective manner.
18 U.S.C. § 3553(a)(2).
[34] Application Note 10 to U.S.S.G. § 2F1.1 provides in pertinent part: "In a few instances, the loss determined under subsection (b)(1) may overstate the seriousness of the offense. This may occur, for example, where a defendant attempted to negotiate an instrument that was so obviously fraudulent that no one would consider honoring it. In such cases, a downward departure may be warranted."
[35] All other objections to the text of the PSI report have been considered and are also overruled. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585018/ | 147 Mich. App. 237 (1985)
382 N.W.2d 759
PEOPLE
v.
CLARK
Docket No. 84650.
Michigan Court of Appeals.
Decided November 18, 1985.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, Christopher S. Boyd, Prosecuting Attorney, and Kay F. Pearson, Assistant Prosecuting Attorney, for the people.
State Appellate Defender (by Richard B. Ginsberg), for defendant on appeal.
Before: V.J. BRENNAN, P.J., and BEASLEY and J.P. NOECKER,[*] JJ.
BEASLEY, J.
On November 14, 1984, defendant, Wheeler Clark, pled guilty to a charge of armed robbery, in violation of MCL 750.529; MSA 28.797. Pursuant to a plea agreement, the prosecutor agreed to recommend a prison term consistent with the sentencing guidelines. On January 9, 1985, defendant was sentenced to serve not less than three years nor more than six years in prison. Defendant appeals as of right.
On appeal, defendant argues that the trial court improperly calculated his status under the sentencing guidelines. Specifically, defendant asserts that the trial judge improperly scored two factors in the offense variable portion of the guideline scoring.
*239 First, the trial judge assigned three points to defendant, as recommended by the guidelines, for "carrying away or holding captive his victim". Defendant claims that the trial judge should have assigned him zero points for this factor, since the carrying away of his victim in this case did not amount to asportation under Michigan kidnapping law. The guidelines specifically state that if the carrying away of the victim does not amount to asportation the defendant should be assigned a score of zero on this factor.
Second, the trial judge assigned two points to defendant, as recommended by the guidelines, for his being involved in "three or more contemporaneous criminal acts". Defendant claims that the trial judge should have assigned him one point for this factor, since there was evidence of only two contemporaneous criminal acts.
The second adjustment argued for by defendant would not, alone, alter the sentencing guidelines recommendation of a minimum sentence of from three to six years. However, if either the first adjustment noted by defendant is made, or both adjustments are made, the minimum sentence recommendation under the guidelines would be lowered to from one and one-half to two years.
Initially, in reviewing the trial judge's calculation of the sentencing guidelines recommendation, it is important to ascertain the proper standard of appellate review in light of the purpose of the Michigan Sentencing Guidelines. The Michigan Supreme Court ordered that use of the sentencing guidelines was mandatory for sentences imposed during the year following March 1, 1984.[1] But, the administrative order and the decisions in this Court reviewing application of the order in the *240 trial courts make it clear that trial judges can depart from the guidelines recommendations as long as they state proper reasons on the record.[2]
In People v Ridley,[3] this Court, citing the departure policy in the statement of purpose of the sentencing guidelines, stated that departures from the guidelines recommendations are invited and encouraged. As the Supreme Court order expressly states, the reason the order requires use of the guidelines is in order to provide data for later evaluation and revision of the sentencing guidelines. It is clear that the sentencing guidelines, at this stage of development, are certainly not etched in stone and revisions may be anticipated.
Support for this conclusion is clearly provided in the "Report of the Michigan Felony Sentencing Project" (July, 1979), which provided the basic statistical studies that underlie the Michigan Sentencing Guidelines. The report indicates that a very limited data base was used in compiling the raw data for eventual development of the guidelines. A sample of 6,000 felony sentencing cases, all from the year 1977, was used. These 6,000 cases came from trial courts throughout the entire state (except for one county that reported no felony sentences in 1977). However, the sample was not a random sample, but was geographically weighted in order to give adequate representation to "rural-type" county sentencing decisions.[4]
Due to this narrow, one-year sample of sentencing cases, the sentence review committee established by the Supreme Court to study implementation of the guidelines concluded that an experimental *241 stage for use of the guidelines was necessary. This experimental stage would require trial judges to use the guidelines, but would allow departures based on judicial discretion. The reason for the experimental stage would be to allow for revision of the sentencing guidelines recommendations. The committee advised the Supreme Court that it was necessary to add the views of current trial judges in current felony sentencing decisions to the 1977 sample base before even considering whether to make mandatory the guideline ranges themselves.[5]
The Supreme Court administrative order began the experimental stage of application of the sentencing guidelines. The sentence review committee report went on to address the appropriate standard of appellate review during this experimental stage and stated:
"Coerciveness of Appellate Review During Experimental Period. In the preceding section the thought was expressed that, although use of the guidelines procedure should be mandatory for all sentencing judges during a two-year experimental period, it would be a serious mistake to require the judges to conform with the guideline sentence ranges before they had some experience with the procedure and some opportunity for input in the determination of the appropriate sentence ranges for various categories of crime." Sentence Review Committee Report and Recommendation, p 22 (July, 1982).
The committee report went on to state that, even if the guidelines recommendations are made *242 mandatory, trial courts should be allowed to depart from them if proper reasons are stated on the record. Appellate review of departures from the sentencing guidelines should be very limited:
"Standard For Review. The intention of the committee is to recommend only a very limited review of sentence in the Court of Appeals. The court should not substitute its judgment for that of the trial judge in determining the appropriateness of the reason given for deviation from the guideline and should reverse only when the reason is very clearly devoid of any validity. It is the contemplation of the committee that mandatory use of the guidelines system in imposing sentences will, in itself, eliminate most of the serious inequitites in the indeterminate sentence process and thus obviate to a great extent the necessity for appellate review of sentences." Sentence Review Committee Report and Recommendation, pp 29-30 (July, 1982).
Thus, as this Court has consistently held, the proper standard of sentence review after the ordered use of the guidelines remains the "shocking the judicial conscience" standard enunciated in People v Coles.[6]
Specifically addressing the issue that faces this Court in the within case, the sentence review committee report states:
"Thought must also be given to the question of how to respond when the parties request the Court of Appeals to review the scoring decisions which the trial court must make to arrive at the guideline sentence. The committee believes that it is absolutely crucial that the Court of Appeals never get bogged down in a close review of these many scoring decisions. The committee therefore believes very strongly that the underlying factual findings which the sentencing judge may have to make must be upheld if there is any evidence to *243 support them." Sentence Review Committee Report and Recommendation, p 30 (July, 1982).
We agree with the sentence review committee report and refuse to get bogged down in second-guessing the trial judge's mechanics in scoring the sentencing guidelines. In the within case, the trial judge had evidence to support his scoring of three points for defendant's "carrying away or holding captive is victim". Thus, no adjustment of the trial judge's calculation of the guideline recommendation as it relates to defendant under his armed robbery conviction is necessary.
It should be noted that this case is distinguishable from the recent decision of People v Love,[7] where the prosecutor admitted that there had been a scoring error in the trial court. In that case, this Court went through the guidelines scoring procedure in more detail. But, there was no such admission of error in this case. As noted above, this Court will not get bogged down in second-guessing the detailed calculations under the sentencing guidelines. In the overwhelming majority of cases, review of the sentencing guideline calculation should be perfunctory. Only in the very extreme case should there be any appellate review. Since here the trial judge had adequate evidence to score defendant as he did under the sentencing guidelines, resentencing of defendant is unnecessary.
Affirmed.
NOTES
[*] Circuit judge, sitting on the Court of Appeals by assignment.
[1] Administrative Order No. 1984-1, 418 Mich. lxxx.
[2] See People v Purzycki, 143 Mich. App. 108; 371 NW2d 490 (1985); People v Ridley, 142 Mich. App. 129; 369 NW2d 499 (1985).
[3] Ridley, supra.
[4] Sentencing in Michigan, Report of the Michigan Felony Sentencing Project, pp 59-61 (July, 1979).
[5] Sentence Review Committee Report and Recommendation, pp 19-25 (July, 1982). For example, a significant number of trial judges believe the sentencing guideline recommendation for armed robbery is too light. It may be necessary to formalize a procedure whereby the trial judge will get more input into the sentencing guidelines data base.
[6] 417 Mich. 523; 339 NW2d 440 (1983).
[7] 144 Mich. App. 374; 375 NW2d 752 (1985). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581782/ | 42 So. 3d 391 (2010)
STATE ex rel. Warren WILLIAMS
v.
STATE of Louisiana.
No. 2009-KH-2019.
Supreme Court of Louisiana.
August 18, 2010.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581788/ | 42 So. 3d 378 (2010)
STATE of Louisiana
v.
Charles GREENWOOD.
No. 2010-KK-1805.
Supreme Court of Louisiana.
August 2, 2010.
Stay denied. Writ denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581799/ | 31 So. 3d 181 (2010)
CLEMMONS
v.
STATE.
No. 2D08-3218.
District Court of Appeal of Florida, Second District.
March 31, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1584829/ | 728 N.W.2d 45 (2006)
2007 WI App 16
STATE of Wisconsin, Plaintiff-Appellant,
v.
Michelle R. POPENHAGEN, Defendant-Respondent.[]
No. 2006AP1114-CR.
Court of Appeals of Wisconsin.
Submitted on Briefs November 27, 2006.
Opinion Filed December 12, 2006.
*46 On behalf of the plaintiff-appellant, the cause was submitted on the briefs of Steven M. Michlig, Rhinelander.
*47 On behalf of the defendant-respondent, the cause was submitted on the brief of James B. Connell of Crooks, Low & Connell, S.C., Wausau.
Before CANE, C.J., and HOOVER, P.J., and PETERSON, J.
¶ 1 PETERSON, J.
The State appeals an order suppressing Michelle Popenhagen's bank records and certain incriminating statements she made after the records were seized. The bank records were obtained without probable cause and in violation of state and federal statutes. However, because the State did not violate Popenhagen's state or federal constitutional rights, suppression is not available as a remedy. We therefore reverse the order.
BACKGROUND
¶ 2 This case involves several alleged thefts by Popenhagen from her employer, Save More Foods. According to the criminal complaint, Popenhagen cashed dishonored checks at Save More and stole money from an ATM in the store. The total amount believed stolen was approximately $29,000.
¶ 3 Save More's owner contacted the Minocqua Police Department about Popenhagen on August 16, 2004. He told police Popenhagen was stealing money when she deposited funds into the ATM, and stated Popenhagen had cashed several checks for herself and her mother that had been returned due to a closed account or insufficient funds.
¶ 4 Minocqua police officers then requested subpoenas for Popenhagen's bank records through the Oneida County District Attorney's office. The subpoenas were signed by circuit court judges, although it is not clear what procedure was used in order to obtain the judges' signatures.[1] No determination of probable cause was made in connection with the judges' approval of the subpoenas, which was a violation of the applicable statutory procedure for obtaining a subpoena. See WIS. STAT. § 968.135.[2] The subpoenas were served on two banks, and the banks turned over all of Popenhagen's records, including bank statements and copies of deposit slips and cancelled checks.
¶ 5 On September 19, two officers interviewed Popenhagen about the alleged thefts. According to the police report of the interview, Popenhagen admitted writing checks on accounts containing insufficient funds to cover the checks, but stated she had intended to deposit cash to cover the checks. She denied all allegations that involved theft from Save More.
¶ 6 The officers then produced Popenhagen's bank records and confronted her with instances where she made deposits that corresponded to thefts from the Save More store and the ATM. At that point, Popenhagen made several incriminating statements.
¶ 7 Popenhagen was charged with theft, contrary to WIS. STAT. §§ 943.20(1)(b) and (3)(c). Popenhagen moved to suppress the bank records and statements she made after the police confronted her with the records. The court held Popenhagen had a legitimate privacy interest in the records, and the search pursuant to the subpoenas therefore violated her state and federal constitutional rights and WIS. STAT. § 968.135. The court further held the remedy *48 for a violation of § 968.135 was suppression of the records obtained in violation of that section and the fruits of those records.
STANDARD OF REVIEW
¶ 8 This case requires us to apply the state and federal constitutions to undisputed facts. The application of constitutional principles to historical facts is a question of law reviewed without deference. State v. Eason, 2001 WI 98, ¶ 9, 245 Wis.2d 206, 629 N.W.2d 625. This case also involves a question of statutory interpretation. The meaning of a statute is a question of law we review without deference to the circuit court but benefiting from its analysis. Spiegelberg v. State, 2006 WI 75, ¶ 8, 291 Wis.2d 601, 717 N.W.2d 641.
DISCUSSION
¶ 9 Popenhagen argues the subpoenas of her bank records violated the Fourth Amendment, the Wisconsin Constitution, and the Wisconsin Statutes, and that the remedy for those violations is suppression. She also argues the court had inherent authority to exclude the records and their fruits in order to protect the integrity of the judicial process. We conclude neither the Fourth Amendment nor the Wisconsin Constitution recognizes an expectation of privacy in bank records, and therefore the subpoenas did not violate either. We also conclude that while the subpoenas did violate the Wisconsin Statutes, suppression is not available as a remedy for those violations. Finally, the court did not invoke inherent authority in support of its decision; therefore, inherent authority is not grounds for affirming the order.[3]
I. The Fourth Amendment
¶ 10 The Fourth Amendment protects against unreasonable searches and seizures. A "search" for Fourth Amendment purposes exists when an individual "manifested a subjective expectation of privacy in the searched object, and society is willing to recognize that expectation as reasonable." Kyllo v. United States, 533 U.S. 27, 27-28, 121 S.Ct. 2038, 150 L.Ed.2d 94 (2001); Katz v. United States, 389 U.S. 347, 361, 88 S.Ct. 507, 19 L.Ed.2d 576 (1967) (Harlan, J., concurring).
¶ 11 The Supreme Court applied this principle to bank records in United States v. Miller, 425 U.S. 435, 96 S.Ct. 1619, 48 L.Ed.2d 71 (1976). It held there was no legitimate expectation of privacy in bank records, for two reasons. Id. at 442, 96 S.Ct. 1619. First, banks are not "neutrals in transactions involving negotiable instruments, but parties to the instruments with a substantial stake in their continued availability and acceptance." Id. at 440, 96 S.Ct. 1619 (internal citations omitted). As a result, banks' records are not their account holders' "private papers;" instead, they are "business records of the banks." Id.
¶ 12 Second, the Court noted the records are
not confidential communications but negotiable instruments to be used in commercial transactions. All of the documents obtained, including financial statements and deposit slips, contain only information voluntarily conveyed to the banks and exposed to their employees in the ordinary course of business.
Id. at 442, 96 S.Ct. 1619. The Court noted the general rule that when information is *49 divulged to a third party, no Fourth Amendment concerns arise when the third party passes the information on to the government, even when the third party received the information only for a limited purpose. Id. The Court saw no reason to apply a different rule where bank records were involved.
¶ 13 Popenhagen argues Miller is no longer good law, for three reasons: (1) subsequent legislation shows society is now prepared to recognize a privacy interest in bank records; (2) changes in society have rendered Miller's rationale no longer valid; and (3) Miller was met with "nearly universal disapproval" in scholarly criticism.
¶ 14 In support of her argument about subsequent legislation, Popenhagen focuses on the 1978 Right to Financial Privacy Act (RFPA).[4] The RFPA was enacted at least partly in response to Miller. See United States v. Frazin, 780 F.2d 1461, 1465 (9th Cir.1986) (reviewing legislative history). The RFPA prohibited banks from disclosing a customer's financial information without the customer's consent, a valid warrant, or a valid subpoena.[5]Id. at ¶ 12 U.S.C. § 3402. The RFPA provided civil remedies against the government and banks for disclosures made in violation of its terms, and made those remedies exclusive. 12 U.S.C. § 3417(d); Frazin, 780 F.2d at 1466. The RFPA remedies do not include suppression. Frazin, 780 F.2d at 1466. According to the court in Frazin, Congress chose this combination of rights and remedies by balancing customers' right to privacy against the needs of law enforcement. Id.
¶ 15 While the RFPA shows some congressional concern with bank customers' privacy, Congress specifically did not recognize a privacy interest that rose to the level of the Fourth Amendment. If it had, it could easily have crafted a remedy on par with remedies available for Fourth Amendment violations. The fact that Congress chose not to shows it believed bank customers were deserving of some protection, but not the level of protection available under the Fourth Amendment. The RFPA therefore does not show that society is now prepared to recognize a Fourth Amendment privacy interest in bank records.
¶ 16 Finally, Popenhagen argues changes in society subsequent to Miller render Miller obsolete. She argues today "the use of banks and other financial institutions for the storage of personal information is the norm not the exception." However, this argument does not call into question either premise of the Miller decision. That is, it does not change the fact that bank records can be considered "business records of the bank" rather than individual property, or that bank records consist of information divulged to third parties. See Miller, 425 U.S. at 440-42, 96 S.Ct. 1619. Rather, Popenhagen's argument mirrors the Miller dissent, where Justice Brennan argued:
For all practical purposes, the disclosure by individuals or business firms of their financial affairs to a bank is not entirely volitional, since it is impossible to participate in the economic life of contemporary society without maintaining a bank account. In the course of such dealings, a depositor reveals many aspects of his *50 personal affairs, opinions, habits and associations. Indeed, the totality of bank records provides a virtual current biography.
Miller, 425 U.S. at 451 (Brennan, J., dissenting).
¶ 17 Popenhagen's argument is virtually the same as Justice Brennan's. Justice Brennan's statement that it would be "impossible to participate in the economic life of contemporary society" without a bank account makes clear that in 1976 the storage of personal information in bank records was already the rule, not the exception. We are not convinced that the necessity of maintaining a bank account or the kind of information available from bank records has changed significantly from 1976, and therefore reject Popenhagen's argument.
¶ 18 Finally, Popenhagen points to what she characterizes as "nearly universal" scholarly criticism of Miller. This is essentially an argument that Miller was wrongly decided, not an argument that Miller has been eroded or overruled.[6] The vote of legal scholarsunanimous or otherwiseis hardly enough to overrule Supreme Court precedent. Popenhagen fails to point to any Supreme Court or other cases questioning the continued validity of Miller. Absent such cases, Miller remains controlling law.
II. The Wisconsin Constitution
¶ 19 Popenhagen next argues even if the Fourth Amendment does not recognize a right to privacy in bank records, the Wisconsin Constitution does. Because this issue is controlled by State v. Swift, 173 Wis.2d 870, 883, 496 N.W.2d 713 (Ct.App. 1993), we reject Popenhagen's argument.
¶ 20 The Wisconsin Constitution provides:
The right of the people to be secure in their persons, houses, papers, and effects against unreasonable searches and seizures shall not be violated; and no warrant shall issue but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched and the persons or things to be seized.
WIS. CONST. Art. I, § 11. The text of this provision is virtually identical to that of the Fourth Amendment.[7]
¶ 21 In 1993, we held bank records were entitled to the same level of protection under WIS. CONST. Art. I, § 11, as they were under the Fourth Amendment. Swift, 173 Wis.2d at 883, 496 N.W.2d 713. We based our holding on our supreme court's statements that it "consistently and routinely conformed the law of search and seizure under the Wisconsin Constitution to the law developed by the United States Supreme Court under the Fourth Amendment." State v. Guzman, 166 Wis.2d 577, 586-87, 480 N.W.2d 446 (1992). This was due to the consistent text of the two provisions and the practical difficulties police would encounter if they were required to apply a standard that varied from the Fourth Amendment. Id.
¶ 22 Popenhagen argues Swift has been called into question by Eason. Eason involved *51 the "good faith" exception to the exclusionary rule. Eason, 245 Wis.2d 206, ¶ 28, 629 N.W.2d 625. The court adopted a narrower "good faith" exception than exists under the Fourth Amendment, and stated that WIS. CONST. Art. I, § 11, guarantees more protection than the Fourth Amendment with regard to that particular point of law. Id., ¶ 60. However, the court stated its decision was consistent with prior case law, under which the court, despite stated reluctance to give different meanings to the two provisions, recognized it was "conceivable" that the United States Supreme Court might interpret the Fourth Amendment in a way that was inconsistent with Art. I, § 11. Id.; State v. Fry, 131 Wis.2d 153, 174, 388 N.W.2d 565 (1986).
¶ 23 It may well be true, as Popenhagen argues, that Eason shows a new willingness by our supreme court to interpret our state constitution independently of its federal counterpart. See State v. Knapp, 2005 WI 127, ¶ 86, 285 Wis.2d 86, 700 N.W.2d 899 (Crooks, J., concurring) (explaining decisions like Eason as part of a trend toward a more independent role for state constitutions in protecting individual rights). However, Eason did not overrule Swift or even call that case into question. It merely applied the standard existing when Swift was decided to a different question, and reached a different result. Swift is therefore controlling law, and we are bound to follow it. See Cook v. Cook, 208 Wis.2d 166, 189, 560 N.W.2d 246 (1997). We therefore reject Popenhagen's argument that a right to privacy in bank records is recognized by the Wisconsin Constitution.
III. The Wisconsin Statutes
¶ 24 In relevant part, WIS. STAT. § 968.135 provides: "Upon the request of the attorney general or a district attorney and upon a showing of probable cause under s. 968.12, a court shall issue a subpoena requiring the production of documents. . . . This section does not limit or affect any other subpoena authority provided by law." The State concedes § 968.135 applies to this case, and further concedes the subpoena of Popenhagen's bank records was issued in violation of that section. It argues suppression is not available as a remedy, however, because suppression is available only for violations of state or federal constitutional rights or where a statute specifically provides for suppression as a remedy. We agree.
¶ 25 The supreme court recently held: "The suppression of evidence is . . . a judge-made rule used to deter misconduct by law enforcement officials. Suppression is only required when evidence has been obtained in violation of a defendant's constitutional rights, or if a statute specifically provides for the suppression remedy." State v. Raflik, 2001 WI 129, ¶ 15, 248 Wis.2d 593, 636 N.W.2d 690 (internal citations omitted).
¶ 26 In Raflik, the court reviewed a telephone warrant application that had not been recorded. Id., ¶¶ 5-6. The State conceded this was a violation of WIS. STAT. § 968.12, which regulates issuance of search warrants. Id., ¶ 14. Nonetheless, the court concluded suppression was not required because no violation of Raflik's constitutional rights had occurred. Id., ¶¶ 15, 17, 42.
¶ 27 The same situation presents itself here. WISCONSIN STAT. § 968.135 provides a procedure for issuance of a subpoena for documents. In many cases under § 968.135cases where the subpoena calls for release of constitutionally protected documentsa violation of the probable cause requirements of that section will necessarily coincide with a constitutional violation and suppression. However, like violations of WIS. STAT. § 968.12, not all *52 violations of § 968.135 are constitutionally significant. Because the violation here was not constitutionally significant, suppression was not available as a remedy.
IV. Inherent authority
¶ 28 Finally, Popenhagen argues the court had inherent authority to exclude evidence obtained in violation of WIS. STAT. § 968.135. She argues by analogy to civil suits, where the court has both inherent and statutory power to sanction parties who fail to comply with procedural statutes and rules governing the suit. See WIS. STAT. § 804.12(2); Johnson v. Allis Chalmers Corp., 162 Wis.2d 261, 273-74, 470 N.W.2d 859 (1991). Those sanctions include exclusion of evidence and dismissal of the suit. Id. A court's decision to grant sanctions is a discretionary one and will be upheld if the circuit court examined the relevant facts, applied a proper standard of law, and, using a demonstrated rational process, reached a conclusion that a reasonable judge could reach. Id. at 273-74, 470 N.W.2d 859.
¶ 29 Assuming the court had the authority Popenhagen claims, her argument fails because the court never invoked its inherent authority in this case. Instead, the court held:
But it is clear to me that there is now a [state and federally recognized] right to privacy in one's personal banking records. And I'm convinced that obtaining those records over which there is an umbrella of privacy by violating 968.135 of the statutes, should result in suppression. [To hold otherwise] would emasculate the clear directives of 968.135. . . .
Because the court never invoked its inherent authority, it necessarily did not discuss the legal standard involved, apply the facts to that standard, or conclude the evidence should be suppressed as a sanction. Inherent authority therefore is not grounds for affirming the order.
Order reversed.
¶ 30 CANE, C.J. (dissenting).
The majority concludes neither the Fourth Amendment nor the Wisconsin Constitution recognizes an expectation of privacy in bank records and therefore suppression of the State's unlawfully obtained bank records and tainted evidence is not an available remedy in a criminal proceeding. Because I would hold people have a constitutional right under the Wisconsin Constitution against unlawful searches and seizures of their bank records, I respectfully dissent.
¶ 31 WISCONSIN CONST. Art. I, § 11, provides:
The right of the people to be secure in their persons, houses, papers, and effects against unreasonable searches and seizures shall not be violated; and no warrant shall issue but upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched and the persons or things to be seized. (Emphasis added).
Here, the State concedes that it obtained Michelle Popenhagen's bank records in violation of WIS. STAT. § 968.135. It admits it did not even attempt to comply with the probable cause requirement. Section 968.135 provides:
Upon the request of the attorney general or a district attorney and upon a showing of probable cause under s. 968.12, a court shall issue a subpoena requiring the production of documents, as specified in s. 968.13(2). The documents shall be returnable to the court which issued the subpoena. Motions to the court, including, but not limited to, motions to quash or limit the subpoena, shall be addressed to the court which issued the subpoena. Any person who *53 unlawfully refuses to produce the documents may be compelled to do so as provided in ch. 785. This section does not limit or affect any other subpoena authority provided by law. (Emphasis added.)
¶ 32 The issue in this case centers on whether people have a reasonable expectation of privacy in their bank records. In my opinion they do. The right to be secure in one's papers has been applied to a person's private papers since 1886. Boyd v. United States, 116 U.S. 616, 621, 6 S.Ct. 524, 29 L.Ed. 746 (1886).
¶ 33 I recognize that in United States v. Miller, 425 U.S. 435, 442, 96 S.Ct. 1619, 48 L.Ed.2d 71 (1976), the United States Supreme Court held there was no legitimate expectation of privacy under the Fourth Amendment in bank records. However, since Miller, which has been criticized in many academic circles, both Congress and the Wisconsin Legislature responded with legislation strengthening a customer's legitimate right to privacy in bank records. I will confine myself to Wisconsin's legislative response, as I apply only our Wisconsin Constitution and state laws.
¶ 34 It has been recognized and established for some time that it is the prerogative of Wisconsin to afford greater protection to a person's liberties within the boundaries of its constitution and laws. State v. Doe, 78 Wis.2d 161, 171, 254 N.W.2d 210 (1977). The State does not dispute this.
¶ 35 Thus, we first have our Wisconsin Constitution protecting our citizens' right to their papers and effects from unreasonable seizure without a search warrant establishing probable cause. The legitimate expectation of privacy to a person's bank records was reinforced by our legislature in 1979 when it created WIS. STAT. § 968.135, which protects a customer's right to documents such as bank records from subpoenas unless the attorney general or district attorney shows the same probable cause as required in search warrants.
¶ 36 It is noteworthy this statute is included in WIS. STAT. ch. 968, our procedural statute for commencement of criminal proceedings, and follows WIS. STAT. § 968.12, which lists the requirements for a search warrant. Importantly, it is not under a general civil procedure for obtaining a citizen's private bank records. Nor is this a situation where a nongovernmental agency acquired the bank records. WISCONSIN STAT. § 968.135, in my opinion, establishes our citizens' reasonable expectation of privacy in bank records in the context of criminal proceedings.
¶ 37 The State's argument that WIS. STAT. § 968.135 does not include a provision stating that suppression is a sanction for unlawfully subpoenaed bank records is unpersuasive. Interestingly, when one looks at the legislative requirements for a search warrant, the sanction of suppression, or any other sanction for that matter, is not specifically stated. That sanction arises from our constitutional right to be free from unreasonable searches and seizures.
¶ 38 Therefore, in my opinion, people have a legitimate expectation of privacy in their bank records and when the attorney general or district attorney fails to show probable cause for the subpoena, not only must the subpoena be quashed or limited, but the records and evidence obtained unlawfully must not be used in any criminal proceedings. It is no different from the attorney general or district attorney obtaining a search warrant without establishing probable cause. When the State unlawfully obtains a search warrant or, as in this case, unlawfully obtains subpoenaed bank records, the evidence must be suppressed *54 so that it is not used in the criminal proceeding.
¶ 39 Finally, this case involves the flagrant violation of WIS. STAT. § 968.135. No attempt was made to comply with the statute, nor has any explanation been offered for the abuse of this process. Yet the State wants us to ignore the statute and allow evidence resulting from its unlawful seizure to be used in a criminal proceeding. I am not persuaded. The only appropriate remedy in this criminal proceeding is the exclusion of the records and tainted evidence, as the trial court correctly concluded. Accordingly, I respectfully dissent.
NOTES
[] Petition for Review Filed.
[1] Judge Mangerson, whose signature appears on one of the subpoenas, stated he could not explain how his signature or that of his colleague came about. The subpoenas are not in the record.
[2] All references to the Wisconsin Statutes are to the 2003-04 version unless otherwise noted.
[3] The State also argues Popenhagen does not have standing to pursue her Fourth Amendment claim and that she had no subjective privacy interest in her bank records. Because we conclude Popenhagen had no objectively legitimate Fourth Amendment privacy interest in her bank records, we need not address those arguments.
[4] Popenhagen also mentions the 1999 Gramm Leach Bliley Act. However, she focuses on the RFPA, and does not argue the 1999 Act should be analyzed differently than the RFPA. We therefore focus on the RFPA as well.
[5] The parties agree the subpoenas here violated the RFPA, but Popenhagen relies on the RFPA only so far as it is relevant to the Fourth Amendment analysis, not as an independent source of a remedy.
[6] This is especially true in view of the fact that most of the articles were contemporaneous responses to United States v. Miller, 425 U.S. 435, 96 S.Ct. 1619, 48 L.Ed.2d 71 (1976). The most recent article Popenhagen cites was published in 1987, and most of the others were published within five years of the Miller decision.
[7] The differences are certain "inconsequential" variances in punctuation, capitalization, and use of the plural. State v. Guzman, 166 Wis.2d 577, 586-87, 480 N.W.2d 446 (1992); see also U.S. CONST. AMEND. IV. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2753823/ | Case: 14-1810 Document: 17 Page: 1 Filed: 11/20/2014
NOTE: This order is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
MARINE TRAVELIFT INC.,
Plaintiff-Appellant,
v.
ASCOM SPA AND
INTERNATIONAL BOATLIFT EXCHANGE INC.,
Defendants-Appellees.
______________________
2014-1810
______________________
Appeal from the United States District Court for the
Eastern District of Wisconsin in No. 1:14-cv-00443-WCG,
Judge William C. Griesbach.
______________________
ON MOTION
______________________
ORDER
Marine Travelift Inc. moves without opposition to vol-
untarily dismiss this appeal.
Upon consideration thereof,
IT IS ORDERED THAT:
(1) The motion is granted. The appeal is dismissed.
Case: 14-1810 Document: 17 Page: 2 Filed: 11/20/2014
2 MARINE TRAVELIFT INC. v. ASCOM SPA
(2) Each side shall bear its own costs.
FOR THE COURT
/s/ Daniel E. O’Toole
Daniel E. O’Toole
Clerk of Court
s21
ISSUED AS A MANDATE: November 20, 2014 | 01-03-2023 | 11-20-2014 |
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