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https://www.courtlistener.com/api/rest/v3/opinions/1736127/ | 91 So. 2d 224 (1956)
Jim O. BRUNER
v.
STATE of Alabama.
2 Div. 374.
Supreme Court of Alabama.
October 4, 1956.
Rehearing Denied December 13, 1956.
Mallory & Mallory, Selma, for petitioner.
John Patterson, Atty. Gen., and Robt. G. Kilgore, Jr., Asst. Atty. Gen., opposed.
SIMPSON, Justice.
This case is submitted to this Court on motion of the Attorney General to strike the petition for writ of certiorari and the brief of petitioner, and on the merits.
Motion to Strike
The motion to strike is grounded on the failure of petitioner to serve the Attorney General with a copy of the brief. We think the motion is well taken.
Rule 11 of Revised Rules of this Court regarding the signing and serving of briefs upon the adverse party provides:
"Each brief shall be signed by the party filing the same or his attorney and shall contain a certificate at the end thereof, signed by the party or his attorney, that a copy thereof has been delivered or mailed to one of the attorneys for the opposing party, if represented by counsel, or to the opposing party if not so represented and his address is known; and the certificate shall show the date of such delivery or mailing and the person to whom delivered or mailed."
Rule 39 of the Revised Rules regarding application for certiorari to the Court of *225 Appeals provides inter alia for the filing of a petition for such a writ and an accompanying brief.
It is quite apparent that one prerequisite for a consideration by this Court of a petition for such a writ is that the adverse party or his counsel should be served with a copy of the brief of petitioner within the prescribed fifteen day period, in accordance with New Rule 44 of the Revised Rules of this Court. Such was the import of old Rule 44, as construed by this Court, which provided that the brief on certiorari should contain a certificate "that a copy of said brief has been served on counsel for the other side." Burch v. State, 249 Ala. 72, 29 So. 2d 425, 426. We think a fair construction of Revised Rules 11 and 39 leads to the same result.
True, a copy of the petition for writ of certiorari and a copy of the brief in support thereof were served upon Hon. Blanchard McCloud, Solicitor of the 4th Judicial Circuit of Alabama, but he is not the attorney who represents the State in the Appellate Courts. This duty devolves upon the Attorney General. The pertinent statute provides that the Attorney General.
"* * * must attend, on the part of the state, to all criminal cases pending in the supreme court or the court of appeals, and to all civil suits in which the state is a party in the same courts. * * *" § 228, Tit. 55, Code of 1940.
We think our conclusion is reinforced by the necessities of the case for the orderly transaction of such a proceeding, since without having a copy of the brief served on the Attorney General there is no other procedure whereby he would receive notice that a petition for certiorari to the Court of Appeals has been applied for.
Motion to strike granted.
All Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1736357/ | 519 So. 2d 748 (1988)
Michael James WEBB, Appellant,
v.
STATE of Florida, Appellee.
No. 4-86-1499.
District Court of Appeal of Florida, Fourth District.
February 10, 1988.
*749 Richard L. Jorandby, Public Defender, and Jeffrey L. Anderson, Asst. Public Defender, West Palm Beach, for appellant.
Robert A. Butterworth, Atty. Gen., Tallahassee, and Richard G. Bartmon, Asst. Atty. Gen., West Palm Beach, for appellee.
HERSEY, Chief Judge.
This case involves a modified Allen charge (Allen v. United States, 164 U.S. 492, 17 S. Ct. 154, 41 L. Ed. 528 (1896)), given to the jury after five hours of deliberation. Within minutes of receiving the charge the jury found appellant guilty of attempted murder in the second degree. This appeal followed. We reject the other grounds for reversal urged by appellant and comment only on the following colloquy between the trial court and juror Weinberg:
MR. WEINBERG: May I ask a question, Your Honor?
THE COURT: Sure.
MR. WEINBERG: If one juror is not able to render a decision at all, whether it be whatever it is, and the other jurors can, does that mean we cannot make a unanimous decision?
THE COURT: It must be unanimous.
MR. WEINBERG: It does not involve an alternate?
THE COURT: The alternate is not for this purpose.
MR. WEINBERG: We've gone through each one's testimony and it seems that one juror cannot make a decision. I think it's too much of an emotional and heavy burden to make a decision of this degree. It's possible, after some food and rest, it could be different. This is a very serious case and we want to give it the most attention it can get.
THE COURT: All I can tell you is that the verdict must be unanimous. It must be six votes and it has to be rendered tonight.
An Allen charge is permissible, but the general rule is subject to the caveat that an instruction may not be couched in terms which may tend to coerce the jury into reaching a verdict or to coerce a member of the jury to change positions in order to achieve a unanimous decision. Jones v. State, 92 So. 2d 261 (Fla. 1956); Nelson v. State, 438 So. 2d 1060 (Fla. 4th DCA 1983); Kozakoff v. State, 323 So. 2d 28 (Fla. 4th DCA 1975), cert. denied, 336 So. 2d 1184 (Fla. 1976); Bell v. State, 311 So. 2d 179 (Fla. 1st DCA 1975).
A coerced verdict in a criminal case deprives the accused of a fair trial and is contrary to the mandate of the Declaration of Rights of the Constitution of the State of Florida. Whether the coercive instruction constitutes fundamental error depends upon its egregiousness and whether a corrective instruction would have obliterated the taint. Under the circumstances of this case, we hold the error to have been fundamental. See Rodriguez v. State, 462 So. 2d 1175 (Fla. 3d DCA), rev. denied, 471 So. 2d 44 (Fla. 1985). A new trial is required.
REVERSED AND REMANDED FOR NEW TRIAL.
LETTS and STONE, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515814/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
JUAN CARLOS NEGRON, UNPUBLISHED
March 12, 2020
Plaintiff-Appellee,
v No. 350016
Wayne Circuit Court
Family Division
ASHUNTUS LADAWN WATTS, LC No. 18-109614-DC
Defendant-Appellant.
Before: STEPHENS, P.J., and CAVANAGH and SERVITTO, JJ.
PER CURIAM.
In this child custody action, defendant appeals as of right the trial court’s final custody and
parenting time order granting plaintiff sole legal and physical custody of plaintiff and defendant’s
children, JIN and JJN. On appeal, defendant argues that the trial court erred by denying her motion
for summary disposition under MCR 2.116(C)(4) and her motion for reconsideration because the
trial court lacked subject-matter jurisdiction to make an initial custody determination under MCL
722.1201(1). We disagree.
I. FACTUAL BACKGROUND
In the summer of 2017, the parties were residing together in Alabama with JIN and JJN.
The parties agreed to send the children to Michigan to live with their maternal grandmother,
Valerie Owens, so that the children could attend school in Michigan for the 2017-2018 school
year. The children moved into Owens’ home in July 2017. Plaintiff came to Michigan to visit the
children and in September 2017, decided to stay in Michigan to live with Owens and help care for
the children.
The children moved back to Alabama to live with defendant in July 2018. Plaintiff
remained in Michigan. The children resided with defendant and her boyfriend, Steven Weaver in
Alabama. Defendant admitted to Weaver in July 2018, that she hit JIN with a coat hanger, and
Weaver noticed marks on JJN’s leg that also appeared to be caused by a coat hanger. On a separate
occasion, Weaver returned from work and found that defendant left a loaded firearm on the coffee
table while the children were unsupervised. In August 2018, Weaver contacted plaintiff and told
-1-
plaintiff that he feared for the children’s safety. On August 1, 2018, plaintiff filed a custody
complaint and an ex parte motion in Wayne Circuit Court seeking emergency temporary custody
of the children based upon allegations of abuse. The trial court granted plaintiff’s ex parte motion,
and the children returned to Michigan to live with plaintiff in August 2018.
On October 9, 2018, defendant filed a motion for summary disposition under MCR
2.116(C)(4), arguing that the trial court lacked subject-matter jurisdiction under MCL 722.1201(1)
to make a custody determination. The trial court took defendant’s motion under advisement. No
order was entered by that judge. The case was re-assigned from the original judicial officer to
another judge who convened an evidentiary hearing regarding the contested issues of parenting
time and custody in May 2019. The court determined that it had subject-matter jurisdiction under
MCL 722.1201(1) because although the children were in Alabama at the time plaintiff filed the
motion for custody, the majority of the children’s time during the six months prior to that filing
was spent in Michigan. Accordingly, defendant’s motion for summary disposition was denied.
The court granted plaintiff sole physical and legal custody of both children. A final order granting
plaintiff custody was entered on June 7, 2019. Defendant filed a motion for reconsideration that
was denied on July 12, 2019.
II. ANALYSIS
Defendant argues that the trial court erred by denying her motion for summary disposition
under MCR 2.116(C)(4) and her motion for reconsideration because the trial court lacked subject-
matter jurisdiction to make an initial custody determination under MCL 722.1201(1). We
disagree.
This Court reviews de novo a trial court’s decision on a motion for summary disposition.
El-Khalil v Oakwood Healthcare, Inc, 504 Mich. 152, 159; 934 NW2d 665 (2019). Summary
disposition is proper under MCR 2.116(C)(4) when the trial court lacks jurisdiction over the
subject matter of a claim. Daystar Seller Fin, LLC v Hundley, 326 Mich. App. 31, 34; 931 NW2d
15 (2018). “Whether a trial court had subject-matter jurisdiction over a claim is a question of law
that is reviewed de novo.” Id. (citation and quotation marks omitted).
Under the Uniform Child Custody Jurisdiction and Enforcement Act, MCL 722.1101 et
seq., a Michigan court has jurisdiction to make an initial child custody determination only if: (1)
Michigan is the home state of the child on the date of commencement of the proceeding, or was
the home state of the child within six months before commencement of the proceeding and the
child is absent from Michigan but a parent continues to live in Michigan, (2) a foreign court does
not have jurisdiction by reason of the child’s residency, or the court of the home state has declined
to exercise jurisdiction on the basis that Michigan is the more appropriate forum, and the child and
his parents have a significant connection with Michigan other than mere physical presence, and
substantial evidence is available in Michigan concerning the child’s care, protection, training, and
personal relationships, (3) all courts having jurisdiction have declined to exercise jurisdiction on
the basis that Michigan is the more appropriate forum, or (4) no court of another state has
jurisdiction. MCL 722.1201(1); Foster v Wolkowitz, 486 Mich. 356, 364-365; 785 NW2d 59
(2010). The physical presence of a party or child is neither necessary nor sufficient to establish
jurisdiction. MCL 722.1201(1)(3); Foster, 486 Mich. at 365.
-2-
A home state is defined as “the state in which a child lived with a parent or a person acting
as a parent for at least 6 consecutive months immediately before the commencement of a child-
custody proceeding.” MCL 722.1102(g). At the evidentiary hearing, several witnesses testified
that the children lived in Michigan for a period of 12 consecutive months from July 2017 to July
2018. The children began living in Michigan with Owens in July 2017. During that period, Owens
was acting as a parent because she provided for all the children’s needs on a daily basis. Several
witnesses also testified that plaintiff lived in Michigan with the children for a period of 10
consecutive months from September 2017 to July 2018. Thus, the children lived with a parent,
the plaintiff, for at least six consecutive months immediately before the child custody proceeding
was commenced in August 2018. Accordingly, Michigan was the children’s home state under
MCL 722.1102(g). These uncontested facts also support the Michigan court’s jurisdiction under
MCL 722.1101(1). Michigan became the children’s home state in January 2018, more than six
months before plaintiff’s motion for custody was filed in August 2018. Further, while the children
were absent from Michigan when the proceeding was commenced in August 2018, plaintiff
remained in Michigan and continued to reside there. Accordingly, because Michigan was the
children’s home state within six months before the commencement of the proceeding, the children
were absent from Michigan when the proceeding commenced, and plaintiff continued to live in
Michigan, the trial court did not err when it determined that it had subject-matter jurisdiction to
make the initial child custody determination.
Defendant also asserts that the trial court lacked jurisdiction over this matter because
plaintiff’s ex parte motion for emergency custody was based upon a fabrication of the facts, and
plaintiff did not provide any supporting documents or information to prove that the children were
being abused when the prayer for ex parte relief was filed. We find this issue abandoned for want
of supporting legal analysis. “An appellant may not merely announce [her] position and leave it
to this Court to discover and rationalize the basis for [her] claims, nor may [s]he give only cursory
treatment with little or no citation of supporting authority.” Houghton ex rel Johnson v Keller,
256 Mich. App. 336, 339; 662 NW2d 854 (2003) (citations and quotation marks omitted). “An
appellant’s failure to properly address the merits of [her] assertion of error constitutes
abandonment of the issue.” Id. at 339-340 (citation omitted).
However, even assuming arguendo that defendant has not abandoned her claim, we find
that the trial court properly exercised jurisdiction over this matter after considering plaintiff’s ex
parte motion for emergency custody. MCR 3.207(B)(1) provides:
Pending the entry of a temporary order, the court may enter an ex parte order if the
court is satisfied by specific facts set forth in an affidavit or verified pleading that
irreparable injury, loss, or damage will result from the delay required to effect
notice, or that notice itself will precipitate adverse action before an order can be
issued.
“[A] pleading may be verified merely by the declaration that the statements in the pleading are
true and accurate to the best of the signer’s information, knowledge and belief[.]” Miller v
Rondeau, 174 Mich. App. 483, 487; 436 NW2d 393 (1988). When plaintiff filed the ex parte motion
seeking emergency custody of his children, he alleged that the children were being emotionally,
physically, and verbally abused. Plaintiff also averred, “I declare that the statements above are
true to the best of my information, knowledge, and belief,” and plaintiff signed the motion.
-3-
Accordingly, plaintiff’s allegations of abuse constituted specific facts set forth in a verified
pleading. Id. For this reason, the trial court properly considered plaintiff’s allegations in
accordance with MCR 3.207(B). Thus, the trial court did not err when it granted plaintiff’s ex
parte motion for emergency custody of the children.
Affirmed.
/s/ Cynthia Diane Stephens
/s/ Mark J. Cavanagh
/s/ Deborah A. Servitto
-4- | 01-03-2023 | 03-13-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1582017/ | 329 N.W.2d 56 (1983)
STATE of Minnesota, Respondent,
v.
Stephen Carl SCHMIT, Jr., Appellant.
No. 82-595.
Supreme Court of Minnesota.
January 28, 1983.
C. Paul Jones, Public Defender, and Mollie G. Raskind, Asst. Public Defender, Minneapolis, for appellant.
Hubert H. Humphrey, III, Atty. Gen., St. Paul, R. Scott Hill, County Atty., Faribault, for respondent.
Considered and decided by the court en banc without oral argument.
AMDAHL, Chief Justice.
This is an appeal by a criminal defendant, pursuant to Minn.Stat. § 244.11 (1982), from a durational sentencing departure.
Defendant was charged by indictment with first-degree murder in the shooting death of his wife, but a district court jury found him guilty only of first-degree heat-of-passion manslaughter. The presumptive sentence for this offense (severity level VIII) by a person with defendant's criminal history score (zero) normally would be 43 (41-45) months in prison. However, because a firearm was used, the presumptive sentence was 54 months in prison pursuant to Minn.Stat. § 609.11, subd. 5 (1982), and Minnesota Sentencing Guidelines and Commentary II.E. (1982). The sentencing court imposed a sentence of 180 months (15 years), the maximum permitted by statute for the offense of which defendant was convicted. We reduce defendant's sentence to 108 months, which is two times the presumptive sentence duration.
The record on appeal does not include the transcript of the trial, but does include a tape and transcript of the defendant's confession and a copy of the omnibus hearing transcript. It appears that defendant's wife, who was 25, was released from prison on May 5, 1981, after serving time for forgery. On May 8 defendant tried to persuade her parole agent to send her back to prison because of problems he was experiencing with her. Defendant admittedly had entertained thoughts of killing her in the past. On the evening of June 7 he had a long argument with her, which he claimed she insisted on having. After she went to bed, he lay in bed and thought about killing her. At 5:45 a.m. on the 8th, while she lay asleep, he shot her at close range with a .22 caliber revolver, killing her. He then covered the body and let it remain in bed all day. Late that night he put it in the trunk of his car, drove to an area near some railroad tracks, and disposed of it. What little remained of it was discovered around July 20. Positive identification was made on July 30. *57 Defendant was interrogated and confessed on August 1.
The first factor relied upon by the sentencing court as a ground for the durational departure was the court's conclusion, notwithstanding the verdict, that the evidence of premeditation was overwhelming and that therefore defendant deserved greater punishment than the typical defendant convicted of first-degree heat-of-passion manslaughter. In a number of cases we have indicated that generally it is proper for the sentencing court to consider the conduct underlying the charge of which the defendant was convicted. See, e.g., State v. Rott, 313 N.W.2d 574 (Minn.1981); State v. McClay, 310 N.W.2d 683 (Minn.1981); State v. Garcia, 302 N.W.2d 643 (Minn.1981). However, in State v. Womack, 319 N.W.2d 17 (Minn.1982), we recognized an exception to the general rule. In Womack the defendant was charged with being a felon in possession of a pistol and with assault in the second degree (assault with a dangerous weapon). The defendant pleaded guilty to the possession charge on the understanding that the assault charge would be dismissed, but in sentencing the defendant the court based a durational departure on its belief that the defendant had committed the assault. We held that this was improper and reduced the defendant's sentence to the presumptive sentence length, stating:
Notwithstanding [Garcia and related cases], we believe that it was error in this case for the trial court to rely on the overall course of conduct as justification for aggravating defendant's sentence for the possession charge. Defendant admitted that he violated the law in possessing the gun but at all times he has claimed that he used it against the complainant only in self-defense, first in striking her when she attacked him with the knife, later to fire in the air and frighten her in an attempt to stop her from attacking him as he attempted to drive away. Defendant had a right to have a jury determine his guilt or innocence of that charge. He gave up that right only on condition that the charge would be dismissed in exchange for his guilty plea to the possession charge. It is one thing for the sentencing court to look at the conduct underlying the offense to which the defendant plead guilty if the defendant admits that the underlying conduct occurred, but it is quite another thing when the defendant denies that such conduct occurred. In this case the defendant at all times has claimed that he acted in self-defense. Stated differently, although defendant obtained a dismissal of the assault charge in exchange for his guilty plea and although he has never admitted his guilt of the assault charge, he received a term of 30 months, which is the duration of the term which would have been presumptively appropriate if he had been convicted of the assault by a jury.
The state's response is that as a matter of law defendant did not act in self-defense. However, upon analysis it becomes apparent that the state is really arguing that as a matter of fact defendant did not act in self-defense. Given the way in which the case was presented to the trial court, the trial court was not entitled to act as factfinder and determine whether defendant was telling the truth when he claimed that the complainant attacked him with a knife. That being so, we believe that the departure, based on the sentencing court's factfinding, was improper.
319 N.W.2d at 19-20.
In this case there was evidence of premeditation, but the jury did not find defendant guilty either of first-degree murder or any lesser degree of murder but instead found him guilty only of first-degree heat-of-passion manslaughter. The trial court appears to have based the departure in part upon its personal conclusion that defendant committed premeditated murder. If this is so, it was improper. However, the trial court could rely on the fact that defendant apparently never denied that in the past he had entertained thoughts of killing the victim. The jury verdict is not necessarily inconsistent with statements by defendant to this effect. The jury possibly found that *58 although defendant had thought about killing the victim in the past, the plan to kill her on the night in question was concocted while he was in the heat of passion and therefore defendant was guilty only of heat-of-passion manslaughter. It is at least arguable that it is worse to kill a person while in the heat of passion where one has contemplated doing it in the past than it is to kill while in heat of passion without ever having thought about it before.
We also believe that the act was more serious than the "typical" act of heat-of-passion manslaughter in that there apparently was a period of time separating the events that gave rise to defendant's passion and the actual act of shooting the victim. Specifically, the victim apparently trusted defendant enough that she went to sleep in his presence and it was while she was asleep that defendant killed her.[1]
We conclude that the act of heat-of-passion manslaughter by defendant was sufficiently aggravating and serious to justify harsher punishment than that provided by the presumptive sentence for the typical offense of heat-of-passion manslaughter by one with defendant's criminal history score. We do not agree with the sentencing court that this is one of the extremely rare cases in which more than a double durational departure is justified. See, e.g., State v. Norton, 328 N.W.2d 142 (Minn.1982); State v. Stumm, 312 N.W.2d 248 (Minn.1981). Accordingly, we reduce defendant's sentence to 108 months, two times the presumptive sentence duration.
Affirmed as modified.
NOTES
[1] Although defendant concedes that the victim was particularly vulnerable in the sense that she was asleep, we need not and do not decide that point.
In justifying its departure in sentencing, the trial court relied, in part, upon the manner in which defendant disposed of the victim's body. Because defendant made no effort to bargain with information concerning the location of the body, his concealment of the body does not operate as an aggravating factor in sentencing. See State v. Shiue, 326 N.W.2d 648 (Minn. 1982). Other factors relied upon by the trial court, including defendant's apparent lack of remorse and the trial court's belief that a stiffer sentence was needed to deter defendant and others from committing such a crime, are not factors justifying aggravation of the sentence. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583012/ | 31 So.3d 1083 (2010)
R & B FALCON DRILLING USA, INC.
v.
SECRETARY, DEPARTMENT OF REVENUE.
No. 2009 CA 0256.
Court of Appeal of Louisiana, First Circuit.
January 11, 2010.
*1084 Stephen H. Myers, Lafayette, LA, for Appellee R & B Falcon Drilling USA, Inc.
Antonio Charles Ferachi, Frederick Mulhearn, Monica Doss Washington, Shone T. Pierre, Donald Bowman, Miranda Conner, Baton Rouge, LA, for Appellant Cynthia Bridges, Secretary, Louisiana Department of Revenue.
Before: PARRO, KUHN, and McDONALD, JJ.
PARRO, J.
At issue in this appeal is whether the Louisiana Department of Revenue (Department) may impose sales taxes on certain meals provided by the owner of drilling barges for the benefit of its customers as well as use taxes on materials and supplies that were used in the reconstruction of the living quarters on one of its barges. After concluding that no taxes were due, the Board of Tax Appeals (Board) vacated the tax assessment against the owner. On judicial review, the district court upheld the Board's decision with respect to those transactions. The Department appealed the applicable portions of the district court judgment. For the reasons that follow, we reverse and render.
Facts and Procedural History
R & B Falcon Drilling USA, Inc. (R & B)[1] is in the commercial business of drilling oil and gas wells. R & B owns about 30 drilling barges, which it provides under contract to its customers in the oil and gas industry. Pursuant to these contracts, R & B's various services include providing these barges with a crew, drilling equipment, sleeping quarters, and catering services. Generally, all services are performed by R & B personnel pursuant to a lump-sum daily rate contract.
Following a sales and use tax audit for the period of January 1, 1999, through June 30, 2001, the Department issued an assessment totaling $119,846.50[2] against R & B based on a finding that the following amounts were owed in taxes:[3] $63,622.11 on meal sales (after a credit of $29,149.85 for taxes paid on the purchases of groceries for the meals), $33,764.82 on additional *1085 purchases of tangible personal property used in the reconstruction of the living quarters on a barge, and $22,459.57 on purchases of fixed assets/drill pipes. R & B filed a petition with the Board for a redetermination of the sales and use tax assessment.
After considering LSA-R.S. 47:305.1(B) and Mallard Bay Drilling, Inc. v. John Neely Kennedy, Secretary, Department of Revenue and Taxation, 03-1495 (La.App. 3rd Cir.3/31/04), 869 So.2d 954, the Board found that no taxes were owed and vacated the assessment.[4] The Department then filed a petition for judicial review of the Board's decision with the district court. The district court upheld the Board's decision that R & B did not owe taxes on the cafeteria services (meal sales) in question or on the materials and supplies used in R & B's reconstruction of the living quarters on one of its barges. However, the district court reversed that portion of the Board's decision which held that no taxes were owed on the materials and supplies purchased by R & B for drilling activities. From those portions of the district court judgment adverse to it, the Department appeals, contending that the district court erred in failing to find that the following were taxable under the state sales and use tax provisions: R & B's sale of extra meals for the benefit of its customers' personnel and the materials and supplies used in the reconstruction of the living quarters on one of its barges.
Standard of Review
With regard to the appropriate standard of review for those decisions issued by the Board, LSA-R.S. 47:1435 is instructive, as that statute provides that reviewing courts may reverse or modify decisions of the Board, with or without remanding the case, if those decisions are not in accordance with law. International Paper, Inc. v. Bridges, 07-1151 (La.1/16/08), 972 So.2d 1121, 1127. Judicial review of a decision of the Board is rendered on the record as made up before the Board and is limited to facts on the record and questions of law. Id.; see LSA-R.S. 47:1434. The Board's findings of fact should be accepted where there is substantial evidence in the record to support them and should not be set aside unless they are manifestly erroneous in view of the evidence on the entire record. International Paper, Inc., 972 So.2d at 1127-28. Furthermore, if the Board has correctly applied the law and adhered to correct procedural standards, its judgment should be affirmed. Id. at 1128.
Extra Meals
A tax is levied on the sale at retail of each item or article of tangible personal property. LSA-R.S. 47:302(A). "Sale" means any transfer of title or possession, or both, of tangible personal property, for a consideration, and includes the furnishing, preparing, or serving, for a consideration, of any tangible personal property, consumed on the premises of the person furnishing, preparing, or serving such tangible personal property. LSA-R.S. 47:301(12). The term "sale at retail" does not include an isolated or occasional sale of tangible personal property by a person not engaged in such business. Former LSA-R.S. 47:301(10)(c)(ii).[5] "Business" includes any activity engaged *1086 in by any person or caused to be engaged in by him with the object of gain, benefit, or advantage, either direct or indirect. The term "business" shall not be construed to include occasional and isolated sales by a person who does not hold himself out as engaged in business. LSA-R.S. 47:301(1). Absent this exclusion, the terms "sale at retail" and "business" would have included such activity. Notably, neither former LSA-R.S. 47:301(10)(c)(ii) nor LSA-R.S. 47:301(1) excludes from the definitions of "sale at retail" and "business" the frequent, regular, and repeated sales by a person, whether or not he holds himself out as engaged in business.[6]
Drilling barges and personnel to operate the drilling rig equipment were provided by R & B under contract to its customers, who are in charge of the drilling operations. When R & B contracted a drilling barge to a customer, R & B charged a daily rate for the barge and the services provided by its drilling personnel. R & B also contracted with its customers for a certain number of meals provided to its drilling personnel per job or contract. In R & B's standard contract, R & B further provided meals free of charge for two customer personnel per day. So, in addition to the number of meals for R & B's drilling personnel provided for in the contract, if more than two customer personnel or customer third-party personnel came on board in a day, there would be a meal charge for these extra personnel.[7] The customer was charged a fee for each additional meal at a rate of $12 per meal or $48 per day for three meals and a snack. The charge was, in effect, a reimbursement of the additional costs incurred by R & B to provide the extra meals.[8]
The evidence reveals that, during the tax period in question, R & B's customers were charged the following for extra meals for more than two customer personnel or customer third-party personnel per barge per day:
1999 2000 2001
January $ 83,300.00 $ 57,462.50 $126,012.50
February $104,700.00 $ 42,000.00 $ 52,512.50
March $ 63,250.00 $ 61,725.00 $107,712.50
April $ 67,487.50 $ 63,562.50 $155,087.00
May $ 49,125.00 $ 71,175.00 $ 46,662.50
June $ 51,525.00 $ 76,512.50
July $ 31,550.00 $ 97,512.50
August $ 53,037.50 $ 104,325.00
September $ 56,650.00 $ 110,862.50
October $ 66,487.50 $ 160,112.50
November $ 62,987.50 $ 118,800.00
December $ 69,462.00 $ 107,700.00
___________ ____________ ______________
Total $759,562.00 1,071,750.00 $487,987.00
Therefore, over the course of 29 months or 882 days,[9] R & B charged its customers a total of $2,319,299 (an average of $2,629.59 per day) for extra meals that were provided to customer personnel or customer third-party personnel. At a per day rate of $48, R & B would have provided extra meals on all of its barges for almost 55 people daily.
*1087 The schedule of advance tax credit due that was offered into evidence and that was prepared by the Department in connection with R & B's purchases of food reveals that during the 29-month period in question, R & B's total purchases of food was $5,123,254.81. The percentage of excess meals charged to customers to the total meals prepared ranged from 11.06 to 18.79 percent. The portion of R & B's food purchases used only for preparation of excess meals was $822,464.61. At a rate of almost 55 persons per day for 882 days, the cost of the food used to prepare extra meals averaged approximately $16.95 per person a day, while extra meals were being sold for not more than a total of $48 per day, a difference of $31.05. Furthermore, the total of extra meals was sold for approximately $1,496,834[10] above the food costs.
The evidence establishes that R & B's sales of extra meals for the benefit of customer personnel and customer third-party personnel were not isolated and occasional in that they were made frequently, routinely, and continuously. We recognize that R & B's primary business is not the sale of meals. It is undisputed that the availability of the living quarters was integral to R & B's commercial operations of the drilling barges. We find that the same holds true for its service of providing extra meals for the benefit of its customers. Because R & B engaged in the sale of extra meals frequently, routinely, and continuously as a part of its regular business, R & B should be construed to be engaged in that "business" for purposes of LSA-R.S. 47:301(1) and 301(10). See McNamara v. Oilfield Const. Co., Inc., 417 So.2d 1311, 1318 (La.App. 3rd Cir.), writ denied, 422 So.2d 157 (La.1982).[11] We find the facts of this case to be distinguishable from those of Marmac Corp. v. McNamara, 546 So.2d 585 (La.App. 1st Cir. 1989), involving the sale of non-serviceable barges by the lessor of a fleet of approximately 750 barges.[12]
For these reasons, we find the record does not contain a reasonable basis to support the factual finding that the sales of extra meals were occasional or isolated sales of tangible personal property made by a person not engaged in such business and, therefore, this finding was an unreasonable one. See Stobart v. State, through the Dept. of Transp. and Dev., 617 So.2d 880, 882. Because the undisputed evidence demonstrates that during the subject tax period R & B continuously and repeatedly sold extra meals as part of its regular business, the district court's affirmance of the Board's finding was manifestly erroneous. Accordingly, we conclude that R & B's sales of extra meals are taxable.
*1088 Materials and Supplies for Living Quarters
At issue in this case is also an exemption from sales and use taxes provided by LSA-R.S. 47:305.1. At the time of R & B's purchase of the materials and supplies in question, LSA-R.S. 47:305.1 provided in its entirety:[13]
A. The tax imposed by R.S. 47:302(A)(1), 321(A)(1), and 331(A)(1) shall not apply to sales of materials, equipment, and machinery which enter into and become component parts of ships, vessels, or barges, including commercial fishing vessels, drilling ships, or drilling barges, of fifty tons load displacement and over, built in Louisiana nor to the gross proceeds from the sale of such ships, vessels, or barges when sold by the builder thereof.
B. The taxes imposed by R.S. 47:302 and R.S. 47:321 shall not apply to materials and supplies purchased by the owners or operators of ships or vessels operating exclusively in foreign or interstate coastwise commerce, where such materials and supplies are loaded upon the ship or vessel for use or consumption in the maintenance and operation thereof; nor to repair services performed upon ships or vessels operating exclusively in foreign or interstate coastwise commerce; nor to the materials and supplies used in such repairs where such materials and supplies enter into and become a component part of such ships or vessels; nor to laundry services performed for the owners or operators of such ships or vessels operating exclusively in foreign or interstate coastwise commerce, where the laundered articles are to be used in the course of the operation of such ships or vessels.
C. The exemption from the state sales tax provided in this Section shall be applicable to any sales tax levied by a local governmental subdivision or school board.
D. Repealed by Acts 1982, No. 56, § 4, eff. July 10, 1982.
The exemption provided for in Subsection B applied only to "ships or vessels" and was inapplicable to the drilling barge at issue in this case. See Mallard Bay Drilling, Inc. v. John Neely Kennedy, Secretary, Department of Revenue and Taxation, 04-1089 (La.6/29/05), 914 So.2d 533, 548-49. Thus, the Board legally erred in utilizing LSA-R.S. 47:305.1(B) to determine the taxability of the materials and supplies used in the work performed on the barge's living quarters.
On the other hand, the exemption provided for in Subsection A only applied to materials used in the original construction of the barge, not to those used in replacing barge components. See McNamara v. Central Marine Serv., Inc., 507 So.2d 207, 208 (La.1987). After examining the legislative intent relative to the scope of the exemption granted by LSA-R.S. 47:305.1(A), the supreme court in McNamara v. Central Marine Serv., Inc. observed that the exemption was created to relieve Louisiana shipyards of a competitive disadvantage with shipyards in neighboring states.[14]Id. at 209-12.
*1089 The materials and supplies were used in the reconstruction of the barge's living quarters, which became a permanent part of the barge. Since the materials and supplies were for the replacement of the living quarters, as opposed to the original construction, they do not qualify under McNamara v. Central Marine Serv., Inc. for the exemption set forth in Subsection A of LSA-R.S. 47:305.1. Furthermore, R & B is not a shipbuilding company and does not build ships in Louisiana.
Because the materials and supplies were used for more than a mere repair, R & B urges that this case is distinguishable from McNamara v. Central Marine Serv., Inc. and these materials and supplies qualify for the exemption. Department regulations seem to support R & B's argument that materials and supplies that become a component part during a major refurbishing of an older vessel or hull is exempt under LSA-R.S. 47:305.1(A). See LAC 61:I.4403(A). To qualify for exemption under LSA-R.S. 47:305.1(A), materials, machinery, and equipment that become component parts of ships, vessels, or barges of 50 tons load displacement and over, built in Louisiana, must be added during construction or reconstruction. LAC 61:I.4403(A). Materials, machinery, and equipment that replace worn components are not exempt under LSA-R.S. 47:305.1(A). LAC 61:I.4403(A). However, reconstructions qualify for exemption under LSA-R.S. 47:305.1(A) if they modify the craft's function, such as conversion of a deck barge to a crane barge, or restore the craft to seaworthiness following its destruction by sinking, collision, or fire. LAC 61:I.4403(B). Under Department regulations, reconstructions qualify for the exemption but only in limited situations, none of which are present in the instant case.[15]
Had the legislature intended the exemption at issue to apply to the repairs, where such materials and supplies enter into and become a component part of such a barge, it could have done so by using the specific language it employed in other provisions of LSA-R.S. 47:305.1. See LSA-R.S. 47:305.1(B). Accordingly, we conclude that the Board legally erred in finding that R & B was entitled to a sales tax exemption on the materials and supplies which replaced original components of the living quarters on its barge. See Canal Barge Co., Inc. v. McNamara, 511 So.2d 1196, 1198 (La.App. 4th Cir.1987).
Decree
For the foregoing reasons, we reverse those portions of the judgment of the district court which have been appealed, as well as the decision of the Board of Tax Appeals. Judgment is rendered reinstating the December 4, 2002 assessment by the Louisiana Department of Revenue against R & B Falcon Drilling USA, Inc. for the tax period of January 1, 1999, through June 30, 2001. All costs are assessed to R & B Falcon Drilling USA, Inc.
REVERSED AND RENDERED.
NOTES
[1] The Offshore Drilling Company is now the successor in name to R & B.
[2] With interest calculated to February 2, 2003, the assessment totaled $170,248.77.
[3] All of the transactions that were the subject of the audit occurred in Louisiana inland waters.
[4] Mallard Bay Drilling, Inc., 869 So.2d 954, was subsequently reversed by the supreme court. See Mallard Bay Drilling, Inc. v. John Neely Kennedy, Secretary, Department of Revenue and Taxation, 04-1089 (La.6/29/05), 914 So.2d 533, 548-49.
[5] After the effective date of 2003 La. Acts, No. 73, § 1, this provision is now found at LSA-R.S. 47:301(10)(c)(ii)(bb).
[6] Any ambiguity in a taxing statute must be construed in favor of the taxpayer. United Gas Corporation v. Fontenot, 241 La. 564, 129 So.2d 776, 781 (1961); McNamara v. U.O.P., Inc., 389 So.2d 741, 750 (La.App. 2nd Cir. 1980); Marmac Corp. v. McNamara, 546 So.2d 585, 588 (La.App. 1st Cir.1989). However, tax exemptions are an exceptional privilege that must be expressly and clearly conferred in plain terms. Showboat Star P'ship v. Slaughter, 00-1227 (La.4/3/01), 789 So.2d 554, 560; McNamara v. Central Marine Serv., Inc., 507 So.2d 207, 208 (La.1987).
[7] The meals prepared by R & B's staff are not for sale to the general public nor does R & B hold itself out to the public as being engaged in cafeteria-style service. This service is considered by R & B to be an adjunct of its primary business related to the drilling of oil and gas wells.
[8] Groceries were purchased to prepare all the meals, and R & B paid sales taxes on these purchases.
[9] 365 days in 1999 + 366 days in 2000 + 151 days in 2001 = 882 days.
[10] $2,319,299-$822,464.61 = $1,496,834.39.
[11] In McNamara v. Oilfield Const. Co., Inc., the court stated that although the sales of signs, cattle guards, lumber, nails, and aluminum gates made up only a small part of the defendant's total revenues (less than 1% of its gross revenue), those sales were a part of the defendant's regular business and therefore taxable. McNamara v. Oilfield Const. Co., Inc., 417 So.2d at 1318.
[12] Marmac Corporation (Marmac) was engaged in the leasing and servicing of a fleet of approximately 750 barges throughout the Gulf Coast and the Mississippi/Ohio River waterways. Marmac sold old barges for scrap or other use when they became no longer serviceable for Marmac's leasing business. Marmac Corp. v. McNamara, 546 So.2d at 586. In any given month, Marmac sold no more than one-fourth of one percent of its fleethardly the amount of sales volume which would be characteristic of the business of selling barges. Id. at 587-88. The court agreed that the sales of barges were merely incidental to the main business of Marmac as a lessor of barges. Id. at 588.
[13] The legislature amended Section 305.1 in 2002 (which is after the tax period in question) to define "foreign or interstate coastwise commerce." See current LSA-R.S. 47:305.1(C); 2002 La. Acts, No. 40, § 1, effective June 25, 2002; 2002 La. Acts, No. 41, § 1, effective June 25, 2002. The supreme court has found that Subsection C is prospective only. Mallard Bay Drilling, Inc., 914 So.2d at 537. The legislature amended Section 305.1(B) in 2006 to include barges and drilling ships. See current LSA-R.S. 47:305.1(B); 2006 La. Acts, 1st Ex.Sess., No. 34, § 1.
[14] The court in McNamara v. Central Marine Services, Inc. noted that if the legislature had intended to exempt repair parts, it could have done so as it had in LSA-R.S. 47:305.1(B), relating to ships and vessels operating exclusively in foreign or interstate coastwise commerce.
[15] In so observing, we render no opinion as to the legal effect of LAC 61:I.4403(B). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582035/ | 469 F.Supp. 1 (1979)
Michael E. SPIESS et al., Plaintiffs,
v.
C. ITOH & CO. (AMERICA), INC., Defendant.
Civ. A. No. 75-H-267.
United States District Court, S. D. Texas, Houston Division.
Memorandum and Opinion March 1, 1979.
On Motion to Amend Judgment and for Certification for Immediate Appeal April 10, 1979.
*2 Charles E. Humphrey, Jr., Edward John O'Neill, Jr., Foreman, Dyess, Prewett, Rosenberg & Henderson, Houston, Tex., for plaintiffs.
Neil Martin, Joe P. Martin, Nancy Morrison O'Connor, Fulbright & Jaworski, Houston, Tex., for defendant.
MEMORANDUM AND OPINION
CARL O. BUE, Jr., District Judge.
I. Introduction
Plaintiffs, non-Japanese employees of defendant, have filed suit against defendant pursuant to Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C.A. § 2000e (1974), and 42 U.S.C.A. § 1981 (1970), alleging racially discriminatory employment practices. Defendant C. Itoh & Co. (America), hereinafter "Itoh-America," is a domestic corporation incorporated under the laws of New York and a wholly-owned subsidiary of C. Itoh & Co., Ltd., of Japan, hereinafter "Itoh-Japan," a Japanese corporation which is not a party to the instant suit. Presently before the Court for consideration is Itoh-America's Rule 12(b) motion to dismiss for failure to state a claim upon which relief may be granted. The issue presented is a novel question of first impression: Does the 1953 Treaty of Friendship, Commerce and Navigation between the United States and Japan provide American subsidiaries of Japanese corporations with the absolute right to hire managerial, professional and other specialized personnel of their choice, irrespective of American law proscribing racial discrimination in employment? Consideration of the terms of the Treaty, its legislative history and relevant judicial precedent leads the Court to the conclusion that the Treaty conveys no such absolute right to Itoh-America, and that the motion to dismiss should be denied.
Simply stated, Itoh-America's argument is that it has an absolute right to hire personnel of its choice derived from the interaction of Articles I, VII and VIII of the Treaty. According to Itoh-America, Article VII authorizes Japanese corporations to organize American branches, affiliates and subsidiaries; Article VIII authorizes Japanese corporations to staff branches, affiliates and subsidiaries organized pursuant to Article VII with Japanese managerial, professional and other specialized personnel of its choice; and Article I authorizes and facilitates the entry of Japanese managerial personnel into the United States to staff branch offices and subsidiaries.
Plaintiffs' response to this argument is manifold. They contend: (1) that pursuant to the Treaty's own definitional terms Article VIII(1), the key section of the Treaty for purposes of the instant motion, does not *3 apply to Itoh-America, an American subsidiary of a Japanese corporation; (2) that any immunity from Title VII provided by Article VIII(1) applies only to Itoh-Japan, and that Itoh-America lacks standing to raise Itoh-Japan's rights; (3) that even if Itoh-America had standing to raise Itoh-Japan's rights, it would not be entitled to any immunity because the hiring practices questioned are those of Itoh-America, not Itoh-Japan; and (4) that even if Itoh-America could invoke the full benefit of Article VIII(1) it would not be immune from Title VII because "Article VIII(1) was designed to prevent the imposition of ultra-nationalistic policies with respect to employment, not shield them" and because United Nations Charter provisions, which supersede conflicting treaty provisions, state that all members pledge themselves to promote freedom for all without distinction as to race, thereby vitiating any right to discriminate that Itoh-America may have under the Treaty.
In view of the Court's conclusion that Itoh-America does not come within the purview of Article VIII(1) and that any rights Itoh-Japan has under this article do not shield the employment practices in question, the Court need not determine whether Article VIII(1) provides any immunity from Title VII to any entity in any situation, or whether, assuming such immunity exists under the terms of the Treaty, it has been superseded by United Nations Charter provisions or subsequent foreign policy practice of the United States and Japan. Accordingly, the focus of the following discussion is upon the questions of whether Itoh-America itself is entitled to the rights conveyed by Article VIII(1) and, if not, whether it is shielded from Title VII in the instant case by any Article VIII(1) rights of Itoh-Japan that it may invoke.
II. Absolute Rights Claimed by Itoh-America
On July 22, 1953, the United States and Japan consummated a Treaty of Friendship, Commerce and Navigation for the purpose, as stated in the preface of the Treaty, of "strengthening the bonds of peace and friendship traditionally existing between them and of encouraging closer economic and cultural relations between their peoples . . . by arrangements promoting mutually advantageous commercial intercourse, encouraging mutually beneficial investments, and establishing mutual rights and privileges . . . based in general upon the principles of national and of most-favored nation treatment unconditionally accorded".
Itoh-America asserts that the Treaty gives it three absolute rights, the combined effect of which "is to create an absolute right on the part of United States and Japanese nationals and companies to send their own nationals to the other country to hold managerial and specialized positions within their respective affiliates and subsidiaries". The rights claimed are:
1. The absolute right to establish, maintain, control and manage a wide variety of commercial enterprises by nationals and companies of one country in the other country (Article VII, paragraph 1).
2. The absolute right of nationals of the two countries to enter the other country for the purpose of carrying on trade and engaging in related commercial activities between the two countries (Article I, paragraph 1).
3. The absolute right of nationals and companies of either country to engage, within the other country, managerial, professional, and other specialized personnel "of their choice," including their own nationals (Article VIII, paragraph 1).
Article VII, paragraph 1 provides in relevant part:
"Nationals and companies of either Party shall be accorded national treatment with respect to engaging in all types of commercial, industrial, financial and other business activities within territories of the other Party, whether directly or by agent or through the medium of any form of lawful juridical entity. Accordingly, such nationals and companies shall *4 be permitted within such territories: (a) to establish and maintain branches, agencies, offices, factories, and other establishments appropriate to the conduct of their business; (b) to organize companies under the general company laws of such other "Party, and to acquire majority interests in companies of such other such Party; and (c) to control and manage enterprises which they have established or acquired. . . ."
Article I, paragraph 1 provides in relevant part:
"Nationals of either Party shall be permitted to enter the territory of the other Party and to remain therein: (a) for the purpose of carrying on trade between the territories of the two Parties and engaging in related commercial activities; (b) for the purpose of developing and directing the operations of an enterprise in which they have invested, or in which they are actively in the process of investing, a substantial amount of capital. . . ."
Article VIII, paragraph 1 provides in relevant part:
"Nationals and companies of either Party shall be permitted to engage, within the territories of the other Party, accountants and other technical experts, executive personnel, attorneys, agents and other specialists of their choice. Moreover, such nationals and companies shall be permitted to engage accountants and other technical experts regardless of the extent to which they have qualified for the practice of a profession within the territories of the other Party, for the particular purpose of making examinations, audits, and technical investigations exclusively for, and rendering reports to, such nationals and companies in connection with the planning and operation of their enterprises, and enterprises in which they have a financial interest, within such territories."
III. Scope of Article VIII(1)
As stated above, plaintiffs take the position that pursuant to the Treaty no entity is given the absolute right to hire managerial and specialized personnel in a racially discriminatory manner. In the alternative, plaintiffs contend that even if such a treaty right exists, which they deny, pursuant to the definitional terms of the Treaty it would extend only to a Japanese company doing business directly in the United States through a branch office and not to a subsidiary of a Japanese corporation which is incorporated under the laws of the United States. Since the Court is persuaded that such an absolute right, assuming it existed, would be inapplicable to Itoh-America in the instant case, the question of whether such a right exists at all need not be reached.
The crucial section of the Treaty relied upon by Itoh-America is Article VIII(1) which by its terms provides that "nationals and companies of either Party shall be permitted to engage within the territories of the other Party [personnel] of their choice." Stated otherwise in terms of the instant inquiry, a company of Japan is entitled to engage within the territory of the United States personnel of its choice. Thus, the pivotal issue becomes the nationality of Itoh-America. Plaintiffs urge that the Treaty's own definitional section provides the unequivocal answer to this question. Article XXII(3) provides that "[c]ompanies constituted under the applicable laws and regulations within the territories of either Party shall be deemed companies thereof . . .." Under this definition Itoh-America is a company of the United States because it is incorporated under the laws of the State of New York. Its business operations in the United States are, therefore, those of a United States company in the United States, not the activities of a company of one party within the territory of the other party. Accordingly, plaintiffs argue any immunity from United States discrimination laws conveyed by Article VIII(1) does not apply to Itoh-America.
A. Corporate Nationality Under Oldham
This analysis is supported by the case of United States v. R. P. Oldham, 152 F.Supp. *5 818 (N.D.Cal.1957), wherein the court used a similar standard for determining corporate nationality for purposes of the 1953 Japanese-American Treaty. Kinoshita & Co. Ltd., U.S.A. ("Kinoshita-America"), an American subsidiary of Kinoshita & Co. Ltd., Tokyo, was indicted along with others for conspiracy in restraint of commerce in Japanese wire nails. Kinoshita-America argued that Article XVIII of the Treaty dealing with antitrust violations provided the exclusive remedy available to the government in dealing with antitrust violations by American corporations which are wholly owned by Japanese corporations. The district court held that Article XVIII was not intended as an exclusive remedy; rather than replace American antitrust laws Article XVIII was intended to supplement them. This conclusion was based on the fact that "[t]he tenor of the entire Treaty is equal treatment to nationals of the other party, not better treatment". Id. at 823. The court further held that even if Article XVIII were held to provide an exclusive remedy for antitrust violations, Kinoshita-America lacked standing to invoke its protection.
The Court engaged in a two-step process to arrive at the conclusion that Kinoshita-America was not shielded from United States antitrust laws by Article XVIII. The first step was the determination of the nationality of Kinoshita-America. In order to resolve this question the court looked to Article XXII, the only definitional section of the Treaty, and pursuant to paragraph three of that Article determined that:
"[B]y the terms of the Treaty itself, as well as by established principles of law, a corporation organized under the laws of a given jurisdiction is a creature of that jurisdiction, with no greater rights, privileges or immunities than any other corporation of that jurisdiction."
Id.
Once the question of the nationality of Kinoshita-America was determined, the court completed the two-step inquiry by concluding that an American corporation has no standing to invoke Article XVIII as a defense to United States antitrust laws. Any protection this Article might afford against application of United States law would extend only to Japanese corporations, concluded the Court.
"If con-conspirator [sic] Kinoshita & Co. Ltd., Tokyo had wished to retain its status as a Japanese corporation while doing business in this country, it could easily have operated through a branch. Having chosen instead to gain privileges accorded American corporations by operating through an American subsidiary, it has for most purposes surrendered its Japanese identity with respect to the activities of this subsidiary."
Id.
Itoh-America urges that the Oldham rationale is inapplicable to the instant case on several grounds. It argues that determination of corporate nationality for purposes of Article VIII(1) should not turn on the place of incorporation and that Oldham was wrongly decided on this point. Instead, it contends, the same test used to determine corporate nationality for purposes of assaying the "treaty-trader" status of aliens desiring to enter this country nationality of majority stockholders should be used. In support of this argument, Itoh-America cites excerpts from the Treaty's legislative history. It further argues that the specific holding in Oldham has been tacitly overruled by Calnetics Corporation v. Volkswagen of America, Inc., 532 F.2d 674 (9th Cir. 1976), cert. denied, 429 U.S. 940, 97 S.Ct. 355, 50 L.Ed.2d 309 (1976), and by recent judicial authority liberalizing standing requirements. Analysis of these contentions reveals that they are without merit.
B. "Treaty-Trader" Test of Corporate Nationality
Despite the fact that the Treaty's own definitional section provides that the place of incorporation determines the nationality of a company for purposes of the Treaty and the fact that the court in Oldham determined that an entity identically situated to Itoh-America was an American *6 corporation for purposes of the Treaty, Itoh-America urges this Court to reach a different result.
As support for its argument that it should be considered a Japanese corporation, Itoh-America refers to guidelines promulgated by the Department of State for use by consular officials in determining whether a foreigner seeking admission to the United States qualifies as a "treaty-trader". Article I, paragraph 1 of the Japanese-American Treaty authorizes Japanese nationals to enter the United States as so-called treaty-traders "for the purpose of carrying on trade between the territories of the two Parties and engaging in related commercial activities. . . ." In order to qualify as a treaty-trader an alien must satisfy Department of State regulations which require, among other things, that the alien "be employed by an individual employer having the nationality of the treaty company, or by an organization which is principally owned by a person or persons having the nationality of the treaty country". 22 C.F.R. § 41.40 (1977). Department of State guidelines provide further that:
"[t]he nationality of the employing firm is determined by those persons who own more than 50% of the stock of the employing corporation `regardless of the place of incorporation'."
9 Foreign Affairs Manual Part II. Since it is wholly owned by Japanese interests, and thus is a Japanese corporation for treaty trader purposes, Itoh-America urges that it should be considered a Japanese corporation for purposes of Article VIII(3). Any other conclusion, it argues, requires the absurd result that once a Japanese corporation exercises the right given to it by Article VII(1) to incorporate an American subsidiary, that subsidiary loses all other rights under the Treaty.
The Court finds that resort to the treaty trader guidelines to determine corporate nationality for purposes of interpretation of the Treaty provisions is unwarranted in the face of the clear definitional provisions included in Article XXII(3) of the Treaty itself. Article XXII(3) unequivocally states that for the purpose of the Treaty the nationality of a corporation is determined by the place of incorporation. The fact that nationality is determined by a different standard for other purposes cannot alter the clearly stated test of the treaty itself.
Such a result, far from absurd, is entirely consistent with the purpose of the Treaty as stated in the preface: "[to promote] mutually beneficial investments [by] establishing mutual rights and privileges . . . based in general upon the principles of national and of most-favored-nation treatment . . .." Article VII allows Itoh-Japan to incorporate a subsidiary like Itoh-America under the laws of the United States, and the fact that once such a subsidiary is incorporated it is considered a United States corporation does not mean that it is thereupon bereft of all rights under the Treaty. Article VII(1)(c) specifically provides that such subsidiaries shall be accorded national treatment, defined in Article XXII(1) as "treatment no less favorable than that accorded like enterprises controlled by nationals and companies of such other Party". As the court stated in Oldham,
"Although [Article VII] equates domestic subsidiaries with their foreign parents, it does so only for purposes of that Article, which has the effect of according nationals of one party engaging in business within the territory of the other party the same treatment accorded nationals of the other party. For example, an American subsidiary of a Japanese parent is to have the same rights as any domestically owned corporation. The Article nowhere attempts to give greater rights to such subsidiaries."
152 F.Supp. 823-24.
Thus, while Itoh-America cannot claim whatever benefit Article VIII(1) was designed to convey, it can claim the most important right conveyed by the Treaty the right to be treated as favorably as American corporations in this country. For, as the Oldham court stated:
*7 "The tenor of the entire Treaty is equal treatment to nationals of the other party, not better treatment."
Id. at 823.
C. Nationality Under § 2 of the Protocol
Further support for the proposition that Article VIII(1) does not apply to Itoh-America may be gleaned from an analysis of Article VI(3) read in conjunction with § 2 of the Protocol signed and entered simultaneously with the Treaty. Article VI(3) deals with compensation for property of companies of one country which is taken within the territory of the other country and provides in pertinent part: "Property of nationals and companies of either Party shall not be taken within the territories of the other Party except for a public purpose, nor shall it be taken without the prompt payment of just compensation." By its terms and pursuant to Article XXII definitional provisions, this protection would not extend to subsidiaries like Itoh-America, since they are companies of the United States. In an obvious attempt to extend this protection to such entities, the United States and Japan agreed to add § 2 of the Protocol, which provides:
"The provisions of Article VI, paragraph 3, providing for the payment of compensation shall extend to interests held directly or indirectly by nationals and companies of either Party in property which is taken within the territories of the other Party."
If indirect interests, e. g., subsidiaries like Itoh-America, were considered foreign corporations for purposes of Article VI(3), the addition of § 2 of the Protocol would have been redundant.
D. Legislative History
As further authority for its argument that Article VIII(1) is applicable to United States-incorporated subsidiaries, Itoh-America cites broad language in the legislative history of the Treaty. It is true that the general references to Article VIII(1) contained in the legislative history do not specifically state that subsidiaries are not within the scope of that Article's protection; however, they are not inconsistent with such a conclusion. Furthermore, it is a fundamental rule of statutory construction that in the absence of "statutory ambiguity, the court may not consider the legislative history. . . ." Glenn v. United States, 571 F.2d 270 (5th Cir. 1978). "[T]he plainer the language, the more convincing contrary legislative history must be." United States v. United States Steel Corp., 482 F.2d 439, 444 (7th Cir. 1973), cert. denied, 414 U.S. 909, 94 S.Ct. 229, 38 L.Ed.2d 147 (1973). Not only is the intended scope of Article VIII(1) unambiguous when examined in view of the Treaty's own definitional section, but also the legislative history is far from convincing that the interpretation advanced by Itoh-America is warranted. Commercial Treaties, Hearings Before the Sub-Comm. of the Comm. on Foreign Relations, 87th Cong., 1st Sess., at 3839 (1952).
IV. Standing of Itoh-America to Raise Rights of Itoh-Japan
In addition to attacking the Oldham court's analysis of corporate nationality, Itoh-America contends that subsequent development and expansion of the concept of standing render obsolete the Oldham court's conclusion that an American subsidiary lacks standing to invoke Treaty provisions which by their terms apply only to Japanese corporations. In support of this argument, it cites, among other cases, Calnetics Corporation v. Volkswagen of America, Inc., 532 F.2d 674 (9th Cir. 1976), cert. denied, 429 U.S. 940, 97 S.Ct. 355, 50 L.Ed.2d 309 (1976), as well as the recent Supreme Court decision in Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970) (hereinafter "ADP").
It should be noted that the issue of standing becomes relevant only after the threshold finding that Itoh-America is not a company of Japan for purposes of Article VIII(1). For, if Itoh-America is determined to be a company of Japan, then it would fall within the specific terms of Article VIII(1) and it would be unnecessary to determine whether it has standing to invoke Itoh-Japan's *8 rights under that article. Thus, the following discussion of the standing issue is predicated on the Court's above-stated conclusion that Itoh-America, as an American subsidiary, is provided no direct benefits under Article VIII(1).
In ADP the Supreme Court articulated a two-prong test for determining whether a party has standing. Standing exists when the party raising the claim "alleges that the challenged action has caused injury in fact, economic or otherwise" and that "the interest sought to be protected by the Complainant is arguably within the zone of interest to be protected or regulated by the [law] in question". 397 U.S. 152-53, 90 S.Ct. 829-830.
Given the clear language of the Treaty and the facts in dispute in the instant case the Court concludes that a detailed analysis of the standing issue is unnecessary. Even assuming that Itoh-America has standing to raise the rights of its foreign parent corporation, a question upon which the Court expresses no opinion, no exemption from employment discrimination laws is provided. Any latitude in hiring provided to Itoh-Japan by Article VIII(1) extends to employees whom Itoh-Japan itself hires. The hiring questioned by plaintiffs in the instant case is that of Itoh-America. Thus, even assuming that Article VIII(1) provided Itoh-Japan with absolute immunity from review of its employment decisions in the United States and that Itoh-America had standing to invoke this immunity, it is inapplicable to the hiring practices of Itoh-America.
Itoh-America's reliance upon Calnetics Corp. v. Volkswagen of America, Inc. appears to be two-fold: (1) it contends that Calnetics endorses a much-broader concept of standing which effectively overturns Oldham on that issue, and (2) it argues that Calnetics stands for the proposition that not only does it have standing to raise the rights of Itoh-Japan, but also it is entitled to those same rights itself that is, any right belonging to a foreign corporation under the Treaty automatically belongs to its wholly-owned, United States incorporated subsidiary.
For the reasons discussed above, the question of whether Itoh-America has standing to raise Itoh-Japan's Article VIII(1) rights is of no moment; thus, it is of little importance whether Calnetics articulates a more liberalized standing test. Moreover, analysis of Calnetics reveals that it does not stand for the proposition that a United States-incorporated subsidiary of a foreign corporation has, in addition to all Treaty rights specifically granted it, those Treaty rights granted its foreign parent. There is nothing in Calnetics which is inconsistent with the conclusion reached in Oldham that nationality is determined by place of incorporation, and that United States incorporated subsidiaries of Japanese corporations are considered American corporations for purposes of discerning their rights under the Treaty.
In Calnetics a private antitrust action was brought against Volkswagen of America, Inc., ("VW-America"), a United States-incorporated subsidiary of a West German corporation, and its wholly-owned American-incorporated air-conditioning manufacturing subsidiary. The trial court concluded that defendants had violated the antitrust laws and as part of the remedy ordered divestiture of the local air-conditioning manufacturing company and prohibited VW-America from importing into the United States any Volkswagens with factory-installed air-conditioners for seven years. This remedy was ordered despite the fact that the West German Embassy previously had written the Department of State that such a ban would heavily discriminate against German citizens and German industry and in its opinion, would violate the provisions of a 1954 Treaty between Germany and the United States proscribing discrimination against the products of one party within the territory of the other. The Ninth Circuit reversed the lower court finding of antitrust violations and questioned the remedy of an import ban restriction on the grounds that it "discriminates against the German automobile manufacturer because it forbids him to sell in the *9 United States cars with factory-installed air-conditioning while imposing no similar restriction on domestic automobile manufacturers". Id. 532 F.2d at 693.
Read in a light most favorable to Itoh-America, Calnetics stands for the proposition that a United States incorporated subsidiary of a foreign corporation has standing to raise the claim that the Treaty rights of its parent may be affected by court ordered relief. In this respect, it is important to note the distinction between the facts in Calnetics and the instant case. In Calnetics the Court of Appeals determined that the import ban ordered by the trial court might discriminate against the products of VW-Germany in contravention of that company's Treaty rights. By contrast, given this Court's interpretation of the Treaty involved in the instant case, Itoh-Japan has no Article VIII(1) right to staff Itoh-America. Accordingly, as stated above even if Itoh-America has standing to invoke the Treaty rights of Itoh-Japan, it can claim no shield against application of Title VII to its own employment practices.
V. Conclusion
Faced with an interesting question of first impression, the Court concludes that the 1953 Japanese-American Treaty does not provide Itoh-America with immunity from Title VII. Although many novel issues were raised by the parties in their extensive legal memoranda, not all were addressed or resolved by this Court in view of the dispositive nature of the threshold inquiries.
Given the Treaty's own definitional terms, Itoh-America is a company of the United States for purposes of the interpretation of Article VIII(1). Thus, it can claim no direct protection under Article VIII(1), which applies only to companies of one party within the territories of the other party. Furthermore, even assuming that Article VIII(1) provides absolute immunity from Title VII to Itoh-Japan and that Itoh-America has standing to assert Itoh-Japan's Treaty rights in this action, questions the Court need not resolve, the motion to dismiss must be denied. Any absolute rights granted to Itoh-Japan apply only to its own hiring decisions; the practices challenged in the present litigation are those of Itoh-America. Itoh-America is a United States company for purposes of Title VII and, like other United States companies, is subject to suit on the grounds that its employment practices are racially discriminatory. Accordingly, Itoh-America's motion to dismiss for failure to state a claim upon which relief may be granted is hereby denied.
ON MOTION TO AMEND JUDGMENT AND FOR CERTIFICATION FOR IMMEDIATE APPEAL
On March 1, 1979, this Court entered a Memorandum and Opinion denying defendant's motion to dismiss. Defendant subsequently filed a motion to amend interlocutory order on March 9, 1979, requesting certification of this Court's Order to the Fifth Circuit Court of Appeals pursuant to 28 U.S.C. § 1292(b) (1970). The Court concludes that the March 1 Order involves a controlling question of law as to which there are substantial grounds for difference of opinion and that an immediate appeal may materially advance the ultimate determination of this litigation. Given the complex nature of the case and the fact that the Court has certified a nationwide class, it is apparent that a trial on the merits may prove long, arduous and expensive to all of the parties. In addition, as discussed below, it has come to the Court's attention that the Department of State has issued an opinion letter reaching a different conclusion as to the key issue in the March 1 Order.
In Kelley v. Societe Anonyme Belge D'Exploitation, Etc., 242 F.Supp. 129, 148 (E.D.N.Y.1965) (hereinafter "Kelley") the Court was faced with the interpretation of a treaty and after construing the treaty the Court stated:
"While the court reaches this decision with certainty, it is not unmindful of the admonition of Mr. Justice Cardozo, then sitting on the New York Court of Appeals, in Techt v. Hughes, 229 N.Y. 222, 247, 128 N.E. 185, 193, 11 A.L.R. 166, cert. *10 denied, 254 U.S. 643, 41 S.Ct. 14, 65 L.Ed. 454 (1920):
`No one can study the vague and wavering statements of treaties and decision in this field of international law [the application of a treaty] with any feeling of assurance at the end that he has chosen the right path. One looks in vain either for uniformity of doctrine or for scientific accuracy of exposition. There are wise cautions for the statesmen. There are few precepts for the judge.'
The court, therefore, deems it advisable to certify this decision to the Court of Appeals for the Second Circuit pursuant to 28 U.S.C. § 1292(b)."
Similarly, this Court concludes that in view of the above-stated considerations and the novelty of the issue involved, the logic of the Kelley court is applicable, and certification to the Fifth Circuit of the following question is appropriate: Does the 1953 Treaty of Friendship, Commerce and Navigation between the United States and Japan provide American subsidiaries of Japanese corporations with the absolute right to hire managerial, professional and other specialized personnel of their choice, irrespective of American law proscribing racial discrimination in employment?
For purposes of computing the allowable time for the filing of a petition for permission to appeal pursuant to 28 U.S.C. § 1292(b), the Court's March 1, 1979, Order shall be deemed to be entered as of the date indicated below. All proceedings in this action shall be stayed pending resolution of the appeal.
Subsequent to the March 1 Order this Court learned of the pendency of a very similar case in the Southern District of New York styled Avigliano, et al. v. Sumitomo Shoji America, Inc., 77 Civ. 5641, wherein the same issue involving the 1953 Treaty of Friendship, Commerce and Navigation between the United States and Japan is presented. The Equal Employment Opportunity Commission (EEOC) contacted the Department of State requesting an opinion on four questions raised in the Avigliano case. On October 26, 1978, the EEOC sent the court in Avigliano the Department of State's opinion letter containing an analysis of the very issue deemed controlling by this Court in its March 1 Order. In response to the question of whether the rights conveyed by Article VIII differ depending upon where the challenged company is incorporated the Department of State replied:
"Article VIII is addressed to `nationals and companies of either Party . . . within the territories of the other Party.' Article XXIII defines `companies' as `corporations, partnerships, companies and other associations, whether or not with limited liability and whether or not for pecuniary profit.' In determining the scope of Article VIII, we see no grounds for distinguishing between subsidiaries incorporated in the United States owned and controlled by a Japanese company and those operating as unincorporated branches of a Japanese company, nor do we see any policy reason for making the applicability of Article VIII dependent on a choice of organizational form."
In view of this Court's conclusion in its March 1 Order that Article VIII(1) does not apply to United States incorporated subsidiaries of Japanese corporations, it is apparent that there exists a conflict between this Court's interpretation of the Treaty and the Department of State's interpretation. Well-established principles of treaty interpretation provide that:
"While courts interpret treaties for themselves, the meaning given them by the departments of government particularly charged with their negotiation and enforcement is given great weight."
Kolovrat v. Oregon, 366 U.S. 187, 194, 81 S.Ct. 922, 926, 6 L.Ed.2d 218 (1961). Nonetheless,
"Writers of authority agree that treaties are to be interpreted upon the principles which govern the interpretation of contracts in writing between individuals, and are to be executed in the utmost good faith, with a view to making effective the purposes of the high contracting parties; that all parts of a treaty are to receive a reasonable construction, with a view to giving a fair operation to the whole."
*11 Sullivan v. Kidd, 254 U.S. 433, 439, 41 S.Ct. 158, 160-61, 65 L.Ed. 344 (1920). Thus,
"Courts are to give substantial weight to the construction, if any, which is placed upon the treaty by the political branch; however, they are not required to abdicate what is basically a judicial function."
Kelley, supra at 136.
Application of these rules of construction to the present case dictate that this Court reconsider its earlier decision in light of the opinion letter of the Department of State, since that opinion is entitled to great weight. After careful consideration and analysis, and with all due respect and deference to the Department of State opinion letter, the Court concludes nonetheless that the March 1 Order should stand as written. The Department of State letter contains a very brief analysis of the corporate nationality question and its bearing on the applicability of Article VIII(1) of the Treaty. No mention whatsoever is made of the Article XXIII(3) provision which provides that corporate nationality is determined by place of incorporation and which, when construed with Article VIII(1), led the Court to conclude that Itoh-America is not entitled to whatever benefits are conveyed by Article XIII(1). Similarly, no reference is made to the case of United States v. R. P. Oldham, 152 F.Supp. 818 (N.D.Cal.1957), which interprets corporate nationality under the Treaty the same way as this Court.
Despite the contrary conclusion reached by the Department of State, the Court cannot "abdicate" its judicial function and ignore fundamental rules of legal construction which require "that all parts of a treaty are to receive a reasonable construction, with a view to giving a fair operation to the whole". Sullivan, supra at 439. Such an analysis compels the conclusion that Itoh-America is a company of the United States under the terms of the Treaty and that its employment activities in this country are not the activities of a company of Japan within the meaning of Article VIII(1). Accordingly, the Court concludes that the Department of State opinion letter does not warrant a reversal of the Court's earlier order denying defendant's motion to dismiss. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581985/ | 31 So.3d 183 (2010)
MOORE
v.
STATE.
No. 2D09-2449.
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/1581987/ | 31 So.3d 786 (2010)
WILLIAMS
v.
STATE.
No. 1D09-4950.
District Court of Appeal of Florida, First District.
April 1, 2010.
Decision Without Published Opinion Dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581989/ | 469 F.Supp. 14 (1977)
Karl KAHN, Jeffrey L. Henze, Karen Snelson, Adrian Rose, Donald J. Bessee, David Levine-McDonald, Natalia Shul, Rafael Espinoza, and Al Hart, in behalf of themselves and all other similarly situated members of Hotel and Restaurant Employees' and Bartenders International Union, Local Unions 44, 110, 41, 283 and 9, Plaintiffs,
v.
HOTEL AND RESTAURANT EMPLOYEES' AND BARTENDERS INTERNATIONAL UNION, Local Joint Board of Culinary Workers, Bartenders and Hotel Service Workers of San Francisco, Local Unions 44, 110, 41, 283 and 9, and the Executive Boards of each such union, Defendants.
No. C-75-1903-CBR.
United States District Court, N. D. California.
February 3, 1977.
*15 *16 Dan M. Siegel, Oakland, Cal., for plaintiffs.
Davis, Cowell & Bowe, Alan C. Davis, San Francisco, Cal., for defendants.
MEMORANDUM OF OPINION
RENFREW, District Judge.
This is a class action brought under the Labor Management Reporting and Disclosure Act ("LMRDA"), 29 U.S.C. §§ 401 et seq., challenging the merger of five San Francisco union locals into one. Plaintiffs contend that defendants violated the terms of both the international union's constitution and the bylaws and constitution of each of the local unions; that defendant officers failed to meet their fiduciary duties under § 501 of the LMRDA, 29 U.S.C. § 501 ("Title V"); and that defendants violated § 101(a)(1) and (2) of the LMRDA, 29 U.S.C. § 411 ("Title I"), by denying certain union members their rights to free speech and to an equal vote.
Prior to October 1, 1975, culinary employees in the San Francisco area were represented by five different locals of the Hotel and Restaurant Employees' and Bartenders' International Union ("International").[1] By letter dated April 8, 1975, International President Edward T. Hanley advised the executive officers of each San Francisco local that all five organizations would be merged into a single local union.[2] Defendants' Exhibit 3. After being informed of Hanley's letter, the membership of each local union voted to authorize their officers and executive board to enter into a merger agreement. Shortly thereafter, Anthony Anselmo, Administrative Assistant to the International President, began conducting discussions to arrive at a satisfactory merger plan. On May 27, 1975, the officers and executive board of each local agreed to a "Memorandum of Understanding" concerning the proposed merger. Defendants' Exhibit 5.
*17 On May 30, 1975, President Hanley signed a "Declaration and Order for Merger" ordering that, effective October 1, 1975, the five San Francisco locals would be merged into a single new local union to be known as Hotel and Restaurant Employees' and Bartenders' Union, Local 2, San Francisco, California ("Local 2"). Defendants' Exhibit 4. By letter dated June 18, 1975, the officers who attended the merger meetings with Anselmo notified the general membership that the merger would become effective the following October 1, that the next election of local officers would occur in April, 1978, and that no present officer or executive board member would lose his or her job due to the merger. Plaintiffs' Exhibit L.
On June 30, 1975, one Harold Treskunoff, not a named plaintiff in this action, filed a charge with the National Labor Relations Board ("NLRB") complaining that the decision to merge was illegal. Treskunoff alleged that union officers "restrained and coerced * * * [union members] by failing and refusing to permit * * * said employee-members to participate in" the decision to merge. Defendants' Exhibit 27. On September 2, 1975, the NLRB Regional Director, Natalie P. Allen, found that the merger had taken place in accordance with the International Constitution and refused to issue a complaint on Treskunoff's charge. Defendants' Exhibit 28.
Plaintiffs filed this action on September 11, 1975, seeking, inter alia, to enjoin (1) completion of the proposed merger without approval by the membership, (2) implementation of bylaws for Local 2 without a vote of the membership, (3) election of Local 2 officers before approval of the bylaws by a majority vote of the membership, and (4) acceptance of Local 2 officers elected or appointed prior to the entry of any order granting injunctive relief. Plaintiffs also ask the Court to compel the election of new Local 2 officers within six months of the effective date of the merger. On the day they filed suit, plaintiffs obtained a temporary restraining order enjoining the merger until September 15, 1975, when the matter could be heard by this Court. On September 15, this Court denied plaintiffs' application for a temporary restraining order and set a date for trial.
By letter dated October 9, 1975, Joseph Belardi, President of Local 2, sent a copy of proposed bylaws to members of Local 2 and informed them that a ratification vote would be held on October 24. Defendants' Exhibits 30 and 31. In a letter dated the next day, Belardi informed plaintiffs Bazan and Snelson that they could appoint election observers and that they could use the facilities of the union's printer to print and distribute election material to union members. Defendants' Exhibit 29. Belardi distributed a circular to the membership approximately one week before the election urging them to vote in favor of the bylaws. Plaintiffs' Exhibit R. Plaintiffs distributed no election materials to the general membership. The election was held on October 24 and the new bylaws were ratified by a vote of 3166 to 2449, with 440 challenged ballots. On December 30, 1975, plaintiffs filed a supplemental complaint asking the Court to void the October 24 election and order that a new vote be held.
Plaintiffs allege a myriad of violations in the formation of Local 2. Many of these claims are overlapping and redundant, but they can be broken down into three general categories: objections to the merger itself, objections to the ratification of the Local 2 bylaws, and objections to the appointment rather than the election of Local 2 officers.
I. THE MERGER
Plaintiffs argue that they were denied an equal vote in the merger decision, as guaranteed by § 101 of the LMRDA, 29 U.S.C. § 411(a)(1).[3] In fact, plaintiffs had no right to vote on that issue at all.
*18 International President Hanley ordered the merger in question on May 30, 1975, pursuant to Article V, Section 16 of the International Constitution.[4] Section 16 was adopted at the 1974 Special Convention for the explicit purpose of allowing the International President to order the merger of local unions without the consent of the membership. A similar provision giving the General Executive Board the power to merge the International with other unions was also passed at the same Convention. See Article IV, Section 11, International Constitution. Those who opposed the adoption of the new merger provisions did so
"on the basis that it takes away from the Local Unions the right to their own self-determinations as to how they want to merge with and whom they want to merge with." First Day Proceedings, 1974 Special Convention at 28 (remarks of Delegate Joseph J. Canale) [sic]. Plaintiffs' Exhibit A.
"You are taking our democratic rights away or not giving us a chance to vote." Id. (remarks of Delegate Joseph Massimino) [sic].
President Hanley argued that vesting the International President with the unilateral power to merge was necessary to the well-being of the union:
"Now, it is not my desire to be a god or to have total authority, but in the event that I have to act in that fashion, by God, I want the authority to do it!" Id. at 29 (remarks of President Hanley).
Plaintiffs concede the validity of Article V, Section 16, but argue that it was exercised in an "unreasonable and discriminatory manner." Supplemental Memorandum in Opposition to Motion for Summary Judgment at 3 (filed June 21, 1976). Plaintiffs' arguments, however, actually boil down to the contention that union members were denied an equal opportunity to vote in May, 1975, on whether to authorize "their officers to attend meetings to determine the terms and conditions of the merger." Id. Without reaching the merits of plaintiffs' arguments,[5] the fact remains that the decision to merge was committed solely to the discretion of President Hanley and the General Executive Board. President Hanley sought the advice and consent of the officers of the five locals for obvious and practical reasons. Their consultation was, however, only consultation. Whether there were irregularities in the May voting has no bearing on the validity of President Hanley's merger order of May 30, 1975. The guarantee of an equal right to vote contained in § 101 does not give union members the right to vote on every union decision. Lear Siegler, Inc. v. International U., United A., A. & A. I. Wkrs., 287 F.Supp. 692, 697 (W.D.Mich.1968); Cleveland Orch. Com. v. Cleveland Federation, Etc., 193 F.Supp. 647, 650 (N.D.Ohio 1961), aff'd, 303 F.2d 229 (6 Cir. 1962).
Plaintiffs also contend that the merger violated § 501 of the LMRDA, 29 U.S.C. § 501, because union officials did not allow a meaningful vote on the question of merging the unions and did not reveal their financial interest in being retained as officers in the merged local. First, as discussed supra, there was no vote on the merger. Second, since President Hanley and the General Executive Board could and did unilaterally order the merger, any failure to *19 divulge such information would not affect the validity of the merger itself. See Blanchard v. Johnson, 388 F.Supp. 208, 214 (N.D.Ohio 1975), modified, 532 F.2d 1074 (6 Cir. 1976) (§ 501 duty requires full disclosure on issues that "the rank and file, must decide"). Moreover, the interest of the local union officers was divulged to the membership. In a letter to all union members, dated June 18, 1975, and signed by officers of each local union, the rank and file were informed:
"As we enter into the merger no present officers will stand to lose their positions, including all Executive Board Members as well as all members." Plaintiffs' Exhibit L.
Plaintiffs also argue that defendants had a fiduciary duty to divulge that certain officers would receive pay raises in their new jobs. After reviewing the salaries received by the local officials before and after the merger, the Court finds that no breach of a § 501 fiduciary duty has occurred. Any pay raises that occurred are minimal and can be explained by differing duties in the new local.
Congress did not intend the LMRDA to engender court interference with the internal management of union affairs. See S.Rep.No.187, 86th Cong., 1st Sess. (1959), 2 U.S.Code, Cong. & Admin. News, pp. 2318, 2323 (1959). As the Court of Appeals for the Second Circuit observed in Gurton v. Arons, 339 F.2d 371, 375 (2 Cir. 1964), a case involving § 501:
"The provisions of the L.M.R.D.A. were not intended by Congress to constitute an invitation to the courts to intervene at will in the internal affairs of unions. Courts have no special expertise in the operation of unions which would justify a broad power to interfere. The internal operations of unions are to be left to the officials chosen by the members to manage those operations except in the very limited instances expressly provided by the Act."
Section 501 applies only to union officials' actions that are not authorized by the unions' constitution or bylaws. United Mine Workers of America v. Boyle, 78 CCH Lab. Cas. ¶ 11,183 at 20,051 (D.D.C.1975); Terrazas v. Fitzsimmons, 76 CCH Lab.Cas. ¶ 10,750 at 18,553 (C.D.Cal.1974). And courts give great deference to the judgment of union officials in such matters:
"Courts are reluctant to substitute their judgment for that of union officials in the interpretation of the union's constitution, and will interfere only where the official's interpretation is not fair or reasonable." Vestal v. Hoffa, 451 F.2d 706, 709 (6 Cir. 1971), cert. denied, 406 U.S. 934, 92 S.Ct. 1768, 32 L.Ed.2d 135 (1972) (citations omitted).
Article V, Section 16 empowers the International President to merge local unions "under such terms and conditions and subject to such qualifications as [he] may determine, taking into consideration" such factors as "appear appropriate." Plaintiffs have failed to present any evidence suggesting that the salary increases given to Local 2 officers were unreasonable or inappropriate. Thus, the Court can find no violation of § 501.
II. THE BYLAWS ELECTION
The membership of Local 2 ratified a set of bylaws in a supervised election held on October 24, 1975. Plaintiffs argue that the election should be voided for a variety of reasons, but primarily because it was held in violation of § 101 of the LMRDA. Plaintiffs contend that defendants denied union members an equal right to vote by failing to inform them properly of the issue before them.
As discussed supra, one of Congress's primary considerations in drafting the LMRDA was to avoid unnecessary judicial interference in union elections. As a result, "Congress made suit by the Secretary [of Labor] the exclusive post-election remedy" for violations of Title IV of the Act.[6]Trbovich v. Mine Workers, 404 U.S. *20 528, 531-532, 92 S.Ct. 630, 633, 30 L.Ed.2d 686 (1972). Accord, Davis v. Turner, 395 F.2d 671, 672 (9 Cir.), cert. denied, 393 U.S. 987, 89 S.Ct. 467, 21 L.Ed.2d 449 (1968). By directing litigation through the Secretary, Congress hoped "to protect unions from frivolous litigation and unnecessary judicial interference with their elections * * *." 404 U.S. at 532, 92 S.Ct. at 633. Because of this clear congressional intent, courts are quite reluctant to allow plaintiffs to bypass administrative remedies by framing their claims in terms of Title I violations. See, e. g., Calhoon v. Harvey, 379 U.S. 134, 139-141, 85 S.Ct. 292, 13 L.Ed.2d 190 (1964); Davis v. Turner, supra, 395 F.2d at 672; Gurton v. Arons, supra, 339 F.2d at 374-375; Fennelly v. Local 971, 400 F.Supp. 375 (D.Mass.1975). As the Supreme Court emphasized in Calhoon v. Harvey, supra, 379 U.S. at 139, 85 S.Ct. at 295:
"Plainly, [§ 101] is no more than a command that members and classes of members shall not be discriminated against in their right to nominate and vote."
Plaintiffs seek to invoke § 101 in this case on the ground that defendants' failure to call a special meeting to discuss the proposed bylaws and failure to send union members a copy of the proposed bylaws more than ten days before the election,[7] combined to deny union members their right to an informed vote.[8] Plaintiffs rely upon Blanchard v. Johnson, 388 F.Supp. 208 (N.D.Ohio 1975), modified, 532 F.2d 1074 (6 Cir. 1976), and Sheldon v. O'Callaghan, 497 F.2d 1276 (2 Cir.), cert. denied, 419 U.S. 1090, 95 S.Ct. 681, 42 L.Ed.2d 682 (1974), as precedent for their arguments, but both cases turned on very different facts.
In Blanchard v. Johnson, supra, union members were forced to vote on an affiliation agreement without full disclosure of all relevant information and under misleading circumstances:
"The letter attached to the ballot purported to represent the entire agreement between Local 47 and the ILA [International Longshoremen's Association], but it contained no mention of the previously discussed oral agreements, of any per capita tax, or of any constitutional provision of the ILA." 388 F.Supp. at 212.
The district court concluded that "any right to vote which is guaranteed by [29 U.S.C.] § 411 must be the right to a meaningful vote" and that "[a] meaningful vote is not a deliberately uninformed vote, because as such there is no choice, no selection, but merely a shot in the dark." 388 F.Supp. at 213-214. The Court of Appeals for the Sixth Circuit affirmed the district court on this issue, but cautioned that a court "is not unfettered in its determination of what constitutes * * * a `meaningful vote.'" 532 F.2d 1074, 1078. The Court of Appeals emphasized that the judiciary should exercise *21 a "sound reluctance" to interfere with union affairs. 532 F.2d at 1078.
Sheldon v. O'Callaghan, supra, is also quite distinguishable from the instant case. In that case union officials deliberately distorted campaign information in a referendum on a new constitution and denied opponents a chance to mail information to union members. 497 F.2d at 1281-1282. In the case at bar, defendants neither denied plaintiffs an opportunity to communicate their views,[9] nor relegated union members' votes to "shots in the dark." Defendants gave plaintiffs an opportunity to mail campaign literature to each union member, mailed a notice of the referendum and copy of the bylaws to each union member, and held an open meeting to discuss the bylaws. This is clearly a case in which the Court should exercise its "sound reluctance" to intervene in internal union affairs. See Blanchard v. Johnson, supra, 532 F.2d at 1078.
Plaintiffs also seek to frame their "lack of informed vote" argument in terms of a Title V breach of fiduciary obligations. For the same reasons discussed above, plaintiffs fail to make their case.
Plaintiffs further contend that, apart from the LMRDA, the bylaws election was not held in accordance with the bylaws of the five pre-existing local unions because the officers did not call a special meeting to discuss the proposed bylaws and did not give members sufficient advance notice of the election. Plaintiffs also assert that defendants violated both the pre-existing local constitutions and the International Constitution by not allowing amendment to the bylaws. With the dismissal of the federal law claims, this Court will also dismiss plaintiffs' state breach of contract claims. See United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966); Walling v. Beverly Enterprises, 476 F.2d 393, 398 (9 Cir. 1973).
Even if the Court were to consider these "breach of contract" claims, plaintiffs' arguments are without merit. Local 2 is not bound to call special meetings in conformance with bylaw provisions of the pre-merger local unions. A merged union can hardly be held to the varied and possibly conflicting provisions in the bylaws of its predecessors. Moreover, Local 2 did conduct an open discussion of the proposed bylaws at its regular meeting on October 21, 1975. See Defendants' Exhibit 33. On October 14, 1975, union officials also sent the membership copies of the proposed bylaws along with notice of the election and the October 21 meeting. Similarly, plaintiffs' allegation that the officers would not allow members to amend the bylaws is unfounded. While the October 24 referendum consisted of a yes/no vote, Local 2 members have amended the bylaws since October 24, 1975. See Defendants' Exhibit 36 at p. 2 (amendments passed); Defendants' Exhibit 37 at p. 2 (amendment proposed for future vote). A union is under no obligation to submit each proposed bylaw to a seriatim vote. Sheldon v. O'Callaghan, supra, 497 F.2d at 1280.
III. THE ELECTION OF OFFICERS
Plaintiffs contend that defendants' decision to appoint Local 2 officers and not to have an election until April 1978 violated § 101(a) and the pre-existing local union bylaws. As discussed above, Local 2 is a new and independent local union and is not bound by the bylaws of the pre-merger locals.
Section 101 guarantees union members an equal right to nominate candidates and vote in elections, but it makes that right "subject to reasonable rules and regulations in such organization's constitution and bylaws." 29 U.S.C. § 411(a)(1). President Hanley appointed the new officers of Local 2, and the membership approved bylaws which provide that the first nominations and election will take place in March and April of 1978. Article V, Section 16 of the International Constitution gives President Hanley authority to order the merger of *22 locals "under such terms and conditions and subject to such qualifications as [he] may determine." The election will be held within 2½ years of the formation of Local 2 and satisfies the 3-year requirement of Article X, Section 10 of the International Constitution and Article VI, Section 1(a) of the Local 2 Constitution. Plaintiffs do not explain how this decision, approved by the members themselves, discriminates against members or a class of members. See Calhoon v. Harvey, supra, 379 U.S. at 139, 85 S.Ct. 292.
Plaintiffs are really asserting a Title IV claim, 29 U.S.C. § 481, over which this Court has no jurisdiction. Title IV governs the election of local officers, and 29 U.S.C. §§ 482 and 483 make clear that the administrative remedies provided therein "shall be exclusive." In any event, § 481 provides that local labor organizations must elect officers every three years, and § 483 provides that if elections are held within that three-year limit,
"[n]o labor organization shall be required by law to conduct elections of officers with greater frequency or in a different form or manner than is required by its own constitution or bylaws * * *."
29 C.F.R. § 452.14 provides:
"The initial selection of officers by newly formed or merged labor organizations is not subject to the requirements of Title IV. [Footnote omitted.] Such labor organizations may have temporary or provisional officers serve until a regular election subject to the Act can be scheduled. An election under all the safeguards prescribed in these regulations must be held within a reasonable period after the organization begins to function."
Plaintiffs may argue to the Secretary of Labor that 2½ years before an election is unreasonable. They have given this Court no reason to so believe.
IV. ORDER
The above Memorandum of Opinion constitutes the Court's findings of fact and conclusions of law as required by Rule 52(a) of the Federal Rules of Civil Procedure. Accordingly,
IT IS HEREBY ORDERED that defendants' motion for summary judgment is granted.
IT IS HEREBY FURTHER ORDERED that counsel for defendants shall promptly prepare an appropriate form of judgment, obtain approval of counsel for plaintiffs as to form, and submit it to the Court for execution. The parties shall bear their respective costs.
NOTES
[1] The five local unions were Dining Room Employees, Local 9; Bartenders, Local 41; Cooks, Pastry Cooks and Assistants, Local 44; Miscellaneous Culinary Employees, Local 110; and Hotel, Motel, Club and Service Workers, Local 283.
[2] In the letter, President Hanley stated his reasons for ordering the merger:
"There are several reasons why a merger in this instance is desirable, many of which I have discussed in the Catering Industry Employee. Under the present circumstances, there is costly duplication of office facilities and expenses, staff effort, and other related expenses. Experience to date has proven that not only are overall operating expenses reduced, but such mergers enable the new local to better serve the present membership and to more effectively organize the unorganized." Defendants' Exhibit 3 at p. 1.
[3] 29 U.S.C. § 411(a)(1) provides:
"Every member of a labor organization shall have equal rights and privileges within such organization to nominate candidates, to vote in elections or referendums of the labor organization, to attend membership meetings, and to participate in the deliberations and voting upon the business of such meetings, subject to reasonable rules and regulations in such organization's constitution and bylaws."
[4] Article V, Section 16 of the Hotel and Restaurant Employees' and Bartenders' International Union Constitution provides:
"The General President with the approval of the General Executive Board, shall have the power to merge local unions and other subordinate bodies under such terms and conditions and subject to such qualifications as the General President may determine, taking into consideration such circumstances as financial conditions, jurisdiction, location and such other factors as appear appropriate in connection with the local unions and other subordinate bodies involved."
[5] It is worth noting, however, that the merger has been approved by both Natalie P. Allen, NLRB Regional Director, and Carl Rolnick, Director of the Office of Labor-Management Standards Enforcement. See Defendants' Exhibit 28 and Letter of September 23, 1976, from Carl Rolnick (filed December 10, 1976).
[6] Title IV of the LMRDA, codified at 29 U.S.C. §§ 481-483, governs the terms of office and election procedures to be followed in labor organizations.
[7] The 15-day notice requirement contained in 29 U.S.C. § 481(e) applies to the election of officers. Congress did not provide for a set period of notice in all union referenda. In this instance "reasonable notice" such as required by 29 U.S.C. § 411(a)(3)(A) for votes concerning dues increases is sufficient. See Local No. 2, Int. Bro. of Tel. Wkrs. v. International Bro. of T.W., 362 F.2d 891, 895 (1 Cir.), cert. denied, 385 U.S. 947, 87 S.Ct. 321, 17 L.Ed.2d 226 (1966).
[8] Plaintiffs also allege that defendants' failure to make copies of the proposed bylaws available in Chinese and Spanish denied union members their right to an equal vote as guaranteed by § 101. Plaintiffs do not state in their complaint, however, that any named plaintiff was actually injured by this omission. Therefore, plaintiffs do not have standing to assert the claim. As the Supreme Court emphasized in Warth v. Seldin, 422 U.S. 490, 502, 95 S.Ct. 2197, 2207, 45 L.Ed.2d 343 (1975):
"[Plaintiffs] must allege and show that they personally have been injured, not that injury has been suffered by other, unidentified members of the class to which they belong and which they purport to represent. Unless these petitioners can thus demonstrate the requisite case or controversy between themselves personally and respondents, `none may seek relief on behalf of himself or any other member of the class.' O'Shea v. Littleton, 414 U.S. 488, 494, 94 S.Ct. 669, 38 L.Ed.2d 674 (1974)."
Moreover, plaintiffs have not shown that any union member was prejudiced in this case, nor have they cited any authority for requiring a union to print all election materials in several languages.
[9] Plaintiffs have presented no credible evidence that defendants denied union members their § 101 right to free speech at any time during the consideration of the merger or new bylaws. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1581990/ | 31 So.3d 177 (2010)
McDONALD
v.
STATE.
No. SC09-1808.
Supreme Court of Florida.
February 24, 2010.
Decision Without Published Opinion Review denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583000/ | 62 N.W.2d 323 (1954)
158 Neb. 28
PORTIS
v.
CHICAGO, M., ST. P. & P. R. CO.
No. 33410.
Supreme Court of Nebraska.
January 22, 1954.
*324 Fraser, Connolly, Crofoot & Wenstrand, Omaha, for appellant.
Robert E. McCormack, Robert D. Mullin, Omaha, for appellee.
Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.
SIMMONS, Chief Justice.
This is an action for property damages resulting from a collision between a trailer-tractor unit and a train of the defendant. Issues were made and trial had resulting in a judgment for plaintiff. Defendant appeals. We reverse the judgment and remand the cause with directions to dismiss.
The accident happened at Owatonna, Minnesota. Plaintiff was the owner of the tractor. Union Transfer Company was the owner of the trailer. Its claim is assigned to the plaintiff. Plaintiff sues on the two alleged causes of action. The equipment was driven by an employee of Union Transfer Company. A Minnesota statute provides, in case of accident, that the driver is deemed the agent of the owner. The act of the driver is accordingly here deemed by the parties to be the act of the plaintiff on both causes of action.
Defendant moved for a directed verdict at the close of plaintiff's case and at the close of all the evidence. These motions were overruled. Defendant assigns these rulings, among others, as error.
*325 We consider the evidence as it stood at the close of the trial of the case.
Defendant's tracks run through the city of Owatonna in a northwest-southeast direction and in that direction cut across North Street and Cedar Street slightly west of the intersection of the two streets. North Street runs east and west. Cedar Street runs north and south. The right-of-way is 100 feet wide. Plaintiff's driver approached the scene of the accident from the west on North Street. From that direction on North Street there is first a standard "cross buck" railroad crossing sign on the right-hand side (or south), then a side track, then the main-line track, then a second side track, and then another "cross buck" sign on the left or north side of the street. The distance between these two "cross buck" signs is stated at about 96 feet.
The distance between the south siding and main track widens slightly to the southeast and is not definitely shown by any testimony. In between these two tracks on North Street and on the right-hand or south side is a pole upon which there was, at the time of the accident, a no-thoroughfare sign, the exact wording being in dispute.
Between these two tracks on the defendant's property to the south of North Street is a driveway called the cut-off road, which runs through to Cedar Street. It was originally intended for the use of the defendant and the Owatonna Canning Company, and has been and was being used up to the time of the accident by the public to go from North Street to Cedar Street. The canning company's places of business are to the west of the right-of-way on both sides of North Street.
The accident happened on the morning of January 5, 1951. It had been and was then snowing, and snow covered the tracks. The depth of the snow was fixed by plaintiff's witnesses at 8 inches and by defendant's witnesses at 3 to 5 inches.
Plaintiff's driver came to Owatonna to pick up a load of freight for Nebraska. He came east on North Street and stopped at the office of the canning company where he was told to locate the foreman in one of the buildings, which is not definite in the record. He then drove east past the cross buck sign, and saw both of the signs. He crossed the west-side track. He saw a freight car on the track to his right where men were unloading freight into a cannery building. He went to the left of the pole between the west side and main tracks and pulled in to the right-of-way property. In doing so he followed vehicle tracks leading to Cedar Street that were there in the snow. He stopped in those vehicle tracks so as to leave the equipment almost parallel to the main-line track and with the left-rear end of the trailer fouling the main-line track. The rear end of the trailer was about 20 feet south of North Street. The equipment was about 10 to 15 feet east of the box car to which reference has been made. He cut off the ignition of his motor, put on the emergency brakes, and put the equipment into gear. He got out the left-hand side of his tractor. Plaintiff's driver testified that he did not see the main-line track. He does not testify as to any investigation as to his location save as to the location in relation to the box car and being south of North Street. He did not testify as to any inquiry made of the men at the box car. The decision to park where he did was his own. He left his equipment and went into one of the buildings of the canning company. In about 4 or 5 minutes while he was still in the building a south-bound passenger train of defendant ran into the trailer unit. The point of impact was the right front of the engine and about 18 inches on the left rear of the trailer. Substantial damage was done.
It is undisputed that this passenger train had a regular stop at Owatonna. The air brakes were applied about half a mile away and the train had slowed down from a speed of 55 miles per hour to about 15 or 20 miles per hour when the collision occurred. Some distance to the west the customary whistle signals were blown. Plaintiff's driver heard the whistle and then the crash. Both the engineer and *326 fireman saw the trailer when about 100 feet north of North Street. Prior to that time a curve in the track interfered and then snow blocked vision when the point of impact might have been visible otherwise. The emergency brakes were applied, the bell was rung, and the tracks were sanded. The engine stopped about 100 feet east of the point of impact.
Plaintiff argues that because of the use for which the cut-off road was intended and because of the use of the cut-off road by the public he was an invitee and on the premises by permission. We have searched this record for evidence as to the boundaries of the cut-off road. It was somewhere between the main-line and west-side tracks. Plaintiff shows only that his driver was on a track that had been used by some one or more vehicles that day. Certainly it cannot be assumed or inferred that the carrier granted or allowed a use of its property which included a right to block movement of trains on its main line.
The plaintiff, as against a motion for a directed verdict, is entitled to have every controverted fact resolved in his favor and to have the benefit of every inference that can reasonably be deduced from the evidence. Davis v. Spindler, 156 Neb. 276, 56 N.W.2d 107.
The Minnesota rule as to contributory negligence pleaded and proven by the defendant here is as follows: If the plaintiff failed to exercise the care that a person of ordinary prudence would have exercised under similar circumstances, he was guilty of negligence; and, if his negligence contributed, proximately, in any degree to the injury, as a cause, he was, in law, guilty of contributory negligence, and cannot recover.
The above rule is taken substantially from the opinion in Eichhorn v. Lundin, 172 Minn. 591, 216 N.W. 537, 538. In the body of that opinion the court makes this statement also: "There are two necessary elements in contributory negligence.
First, a want or ordinary care, and, second, a causal connection between plaintiff's conduct and the accident. The rule is that a plaintiffs negligence is sufficient to bar a recovery, if it proximately contributes to the result in any degree."
The Minnesota court in Carlson v. Naddy, 181 Minn. 180, 232 N.W. 3, 4, citing the Eichhorn case, held: "The question is not as to the amount of a plaintiff's negligence, if any, but whether, if present at all, it contributed as a cause proximately to the result."
Under these circumstances, the cause of action having arisen in Minnesota, we recognize and follow the Minnesota rule as to contributory negligence. Whitney v. Penrod, 149 Neb. 636, 32 N.W.2d 131; Scott v. Scott, 153 Neb. 906, 46 N.W.2d 627, 23 A.L.R. 2d 1431; Smith v. Brooks, 154 Neb. 93, 47 N.W.2d 389.
Tested by the above rules it is patent that plaintiff's driver, under the circumstances which he relates, exercised a want of ordinary care in parking where he did and leaving the tractor and trailer unattended; that that want of care continued to the time of the accident without intervening event or condition altering it; that there was a causal connection between the conduct of plaintiff's driver and the accident and that it proximately contributed as a cause to the result; and that the Minnesota rule bars a recovery.
Plaintiff, however, denying his driver was guilty of any negligence which proximately contributed to the cause of the collision, argues that even assuming initial negligence it was not continuing and hence the doctrine of the last clear chance should be applied. Defendant argues that the Minnesota rule on last clear chance applies and that the Minnesota rule is less liberal to the person invoking it than is the Nebraska rule. Plaintiff argues that the Minnesota rule was not timely presented and hence we should follow the *327 Nebraska rule. We need not determine this question because it is clear that the Nebraska rule cannot be invoked under the circumstances here.
Plaintiff relies here on our decision in Whitehouse v. Thompson, 150 Neb. 370, 34 N.W.2d 385, 387. There we held: "When the negligence of the party seeking to invoke the last clear chance rule is active and continuous as a contributing factor up to the time of the injury, the last clear chance rule has no application." See, also, Carter v. Zdan, 151 Neb. 185, 36 N.W.2d 781; Bush v. James, 152 Neb. 189, 40 N.W.2d 667.
Plaintiff contends that his negligence, if any, was not continuing and relies on Whitehouse v. Thompson, supra. There we found that the plaintiff was negligent in driving his car to the place near the tracks. At that point the car became lodged in a water drain in such a manner that the icy condition of the street prevented its removal under its own power. We held that that fact was an "intervening condition" which imposed new duties on the parties irrespective of prior negligence and that the last clear chance doctrine applied. But here there was no new or intervening condition which made it impossible for plaintiff's driver to move the tractor and trailer to a place of safety. The act of plaintiff's driver in leaving the trailer and tractor unattended where he did is not a new or intervening condition. For anything that appears in this evidence plaintiff's driver was in control of the situation.
It necessarily follows that the doctrine of the last clear chance has no application here.
The trial court erred in overruling the motion to dismiss. Its judgment is reversed and the cause remanded with directions to dismiss.
Reversed and remanded with directions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583040/ | 462 N.W.2d 742 (1990)
Dennis Eugene DESY and Suzanne Desy, Husband and Wife, Appellees,
v.
Randy C. RHUE and Team Ford, Inc., A Corporation f/k/a Friendly Ford of Sioux City, Inc., Defendants, and
Charles E. Rhue, a/k/a C.E. Rhue, Appellant.
No. 89-923.
Court of Appeals of Iowa.
September 26, 1990.
*743 Emmanuel S. Bikakis and Larry A. Storm, of Bikakis, Vohs, Storm & Arneson, Sioux City, for appellant.
Maurice B. Nieland, of Kindig, Beebe, Rawlings, Nieland, Probasco & Killinger, Sioux City, for appellees.
Heard by SCHLEGEL, P.J., and HAYDEN and SACKETT, JJ.
SCHLEGEL, Presiding Judge.
Plaintiffs-appellees Dennis and Suzanne Desy sued defendant-appellant Charles E. Rhue seeking damages for injuries caused by the negligent operation of a motor vehicle by defendant Randy Rhue. Appellees also sued Team Ford on the same theory. Both Randy Rhue and Team Ford settled with appellees, for $20,000 and $60,000, respectively. Appellees proceeded to trial against appellant, the primary issue being whether appellant was an owner of the vehicle involved in the accident that injured appellees. Appellant seeks relief from an adverse verdict and judgment thereon on the grounds that the evidence was insufficient as a matter of law to submit the question of ownership to the jury. As we discuss below, we agree with appellant that the trial court should have directed a verdict in his favor, and we must, therefore, reverse and remand with directions for the trial court to enter the directed verdict.
During the 1985 Independence Day holiday, defendant Randy Rhue sought to purchase a used Jeep Wagoneer from defendant Team Ford of Sioux City. Randy's father, appellant Charles E. Rhue, at that time provided a blank, endorsed title to Randy for a 1971 Monte Carlo, apparently to be used as he wished. During the course of negotiations with the dealership, Randy disclosed that he had had financial problems. The dealership responded that it would be willing to sell the Jeep to him on credit only if he could obtain a co-buyer.
Over the course of a few days, Randy became interested in the Jeep in question and requested his father's help. Appellant agreed to become the co-owner of the vehicle. On July 6, Randy signed a purchase agreement, termed an offer to purchase, prepared by the dealership. The dealership did not sign the agreement, apparently preferring to wait until it had obtained appellant's signature on the offer. Randy took possession of the Jeep and left the Monte Carlo in the dealership's possession. Driving the Jeep, Randy left to obtain his father's signature on the proposed purchase agreement.
Randy then lived the car buyer's nightmare. On his way home from the dealership, Randy struck motorcyclist Dennis Desy. Desy suffered physical injuries, and his wife claimed damages for loss of consortium.
At trial, Charles Rhue was the sole defendant. The negligence of Randy Rhue was conceded, and the primary factual issue at trial was whether Charles Rhue had an ownership interest in the Jeep at the time of the accident.
The jury returned a verdict awarding the Desys damages of slightly over $109,000 from Charles Rhue. Charles later filed a *744 motion for pro tanto credit, seeking a credit for the entire $80,000 which the Desys had received in settlement from the former defendants (Randy Rhue and the dealership). The Desys responded that Charles was entitled to a credit only for the $20,000 they had received from Randy. The district court agreed with the Desys' position and granted Charles a credit only for the $20,000 settlement from Randy, not for the $60,000 settlement from the dealership. The district court then entered a judgment against Charles for slightly over $89,000. Charles has appealed from the judgment against him.
Appellant challenges the sufficiency of the evidence to permit a jury to find that he had any ownership interest in the Jeep at the time of the accident. Charles contends the evidence permitted only two possible conclusions about ownership: (1) that no sale had occurred at the time of the accident and the dealer remained the owner, or (2) that if a sale could be deemed to have occurred, Randy was the sole purchaser and Charles was involved in the transaction only to help Randy obtain financing.
Appellant also contends the district court erred by excluding certain evidence concerning the temporary paper license which was on the Jeep at the time of the accident, and which indicated that an application for registration had been made. A state trooper who investigated the accident was prepared to testify that the temporary license identified Randy Rhue as the only prospective owner for whom a registration had been sought.
Appellant contends the district court should have submitted to the jury several special interrogatories. The special interrogatories would have required the jury to make specific findings concerning whether appellant had paid any consideration to the dealership for the Jeep, whether the dealership had in any sense delivered possession of the Jeep to appellant before the accident, and whether Randy was acting as an agent for appellant when he signed a proposed purchase agreement for the Jeep. Appellant also argues that the district court erred in several of its jury instructions concerning principles of contract law, agency law, and sales law relevant to the question whether Charles had any ownership interest in the Jeep.
Appellant contends the district court erred by admitting the Desys' evidence that a few months after the accident, Charles had purchased a Jeep Cherokee vehicle from the same dealership. Appellant admits that the second Jeep was for Randy's benefit, but he notes this was because the accident (and a subsequent insurance dispute) had caused the State to suspend Randy's privilege to own and register a vehicle. Appellant argues that because of this factual distinction between the two transactions, the second transaction does not tend to prove or render probable the existence of any fact regarding the first transaction.
Finally, appellant contends the district court erred by giving him credit for only $20,000 of the $80,000 which the Desys received in settlement from the former defendants. He argues that if the case is deemed to be a comparative fault case concerning the negligence of multiple defendants, the Desys' settlement with a party later found to be 100% at fault (Randy) should discharge Charles' liability under the proportionate credit rule of Thomas v. Solberg, 442 N.W.2d 73 (Iowa 1989). In the alternative, if the case is not deemed to involve comparative fault and the pro tanto credit rule applies, appellant argues he should receive credit for the $60,000 settlement paid by the dealership, as well as for the $20,000 settlement paid by Randy; he argues that any other result gives the Desys a double recovery.
Our scope of review is limited to correction of errors at law. Iowa R.App.P. 4. We are bound by the trial court's findings of fact if supported by substantial evidence. Iowa R.App.P. 14(f)(1). We are not, however, bound by the trial court's determinations of law.
The parties agree that the central issue in this case is whether, at the time of the accident, appellant was an owner by bona fide sale or transfer of the vehicle in question. Appellant assigns as error that the *745 evidence is insufficient as a matter of law to establish that he was an owner and the failure of the trial court to grant a directed verdict. Because we find that the evidence presented failed to show that there was a bona fide sale or transfer to appellant, we hold that the trial court erred in failing to direct a verdict in favor of appellant.
Looking to chapter 321 of the Code, we find that section 321.1(36) defines the word "owner" to mean "a person who holds the legal title of a vehicle." In addition, section 321.493 provides, in full:
In all cases where damage is done by any motor vehicle by reason of negligence of the driver, and driven with the consent of the owner, the owner of the motor vehicle shall be liable for such damage.
A person who has made a bona fide sale or transfer of the person's right, title, or interest in or to a motor vehicle and who has delivered possession of such motor vehicle to the purchaser or transferee shall not be liable for any damage thereafter resulting from negligent operation of such motor vehicle by another, but the purchaser or transferee to whom possession was delivered shall be deemed the owner. The provisions of subsection 2 of section 321.45 shall not apply in determining, for the purpose of fixing liability hereunder, whether such sale or transfer was made.
There is no question of consent here. Regardless of "ownership," Randy clearly had the right to be operating the Jeep. Therefore, we focus on the second unnumbered paragraph of section 321.493. Under that paragraph, if appellant was a "purchaser or transferee to whom possession was delivered," he was an owner of the vehicle and may be held liable for the negligence of its driver.
Prior to the enactment of the second paragraph of section 321.493, there was a rebuttable presumption of ownership arising from issuance of a certificate of registration. Bash v. Hade, 245 Iowa 332, 339, 62 N.W.2d 180, 184 (1954). In fact, evidence of issuance of a certificate of registration made a prima facie case of ownership. Id. at 337, 62 N.W.2d at 183 (citing Sexton v. Lauman, 244 Iowa 570, 57 N.W.2d 200, 202-03 (1953)). That presumption, however, could "be so entirely overcome [that] no jury question remain[ed]." Id. at 339, 62 N.W.2d at 180 (citing Craddock v. Bickelhaupt, 227 Iowa 202, 288 N.W. 109 (1939)). The general assembly overturned this method of determining ownership and now requires us to determine whether there has been a bona fide sale or transfer and to discount the effect of the registration of the vehicle for purposes of establishing liability. Act approved April 28, 1955, 56 Iowa Acts 191, ch. 157, § 8 (codified at Iowa Code § 321.493 (1989) (second unnumbered paragraph)).
In Hartman v. Norman, 253 Iowa 694, 112 N.W.2d 374 (1961), the Iowa Supreme Court examined a question of whether there had been a bona fide sale. In that case, the defendant dealership sought to avoid liability for a vehicle which had been delivered to defendant Coy, who had negligently injured the plaintiff. Concerning the necessary evidence, the Supreme Court stated:
The official record raises an inference of ownership but it is at best a rebuttable presumption. Where it is fully overcome by the evidence, the issue is for the court; if the evidence is conflicting, it is for the jury.
Id. at 704, 112 N.W.2d at 380 (citation omitted). The evidence in Hartman indicated that the parties to the sale had executed a signed, written agreement and that all that remained were installment payments on an open account and registering the title. Despite the fact that defendant Coy was judgment-proof, the Court found the agreement valid, held that there was a bona fide sale, and ordered entry of a directed verdict for the defendant dealership. See id.
In keeping with Hartman, and by the terms of sections 321.1(36) and 321.493, we believe that to "hold[ ] the legal title" and to have "a bona fide sale or transfer," a purchaser must, at minimum, possess enforceable rights against the purported seller. This, by definition, is the essence of *746 a contract, see Matherly v. Hanson, 359 N.W.2d 450, 454 (Iowa 1984) ("one of the essential features of a contract is an obligation or liability to do or not do something" (citing Mullenger v. Clause, 178 N.W.2d 420, 428 (Iowa 1970)); therefore, a contract should be a prerequisite to imposing liability upon appellant. To hold otherwise would be to create liability for a vehicle in which appellant would have no legal rightsto impose the sanction of law without granting the concomitant protection of law.[1]
Unlike the Hartman case, however, we hold that there was no conflicting evidence sufficient to warrant a jury determination of whether an enforceable contract was created, hence whether ownership was transferred to appellant. The essential elements of a contract include communication of an offer and acceptance in a manner specified or required by law. The purchase agreement purported to be an offer from the buyer to the seller and stated in bold capital letters that "THIS AGREEMENT IS NOT BINDING UNTIL ACCEPTED BY THE SELLING DEALER OR HIS AUTHORIZED REPRESENTATIVE." Appendix at 329. The question thus may be rephrased as whether, at the time of the accident, the purchase agreement was an enforceable offer by the appellant accepted by the dealership.
Appellees contend that we should find a bona fide sale because everything was agreed and completed but the signing, but in the same breath, they tell us that there is no issue as to the enforceability of the purchase agreement. Appellees further state that "Iowa law is clear that when the terms of an agreement are definitely fixed so that nothing remains except to reduce them to writing, an oral contract will be upheld unless the parties intended not to be bound until the agreement was reduced to writing." Appellee's Brief at 9-10 (citing Severson v. Elberon Elevator, Inc., 250 N.W.2d 417, 420 (Iowa 1977)).
We will assume for the sake of argument that appellant had manifested enough intent to make an offer. Restatement (Second) of Contracts § 26 (1979), states a principle that we believe is well recognized in Iowa law:
A manifestation of willingness to enter into a bargain is not an offer if the person to whom it is addressed knows or has reason to know that the person does not intend to conclude a bargain until he has made a further manifestation of assent.
In this case, it could not be clearer than is expressed in the proposed purchase agreement and by the conduct of the parties to the proposed contract that the parties did not intend to, or believe that they would, be bound until appellant had signed and the dealer had accepted.[2]
Moreover, if there was an effective offer under this agreement which appellant had not even seen, much less signed, it is well within the power of the offeror to assign the time at which the offeree may accept the terms of the contract, see Restatement (Second) of Contracts § 60 (1979) ("If an offer prescribes the place, time or manner of acceptance its terms in this respect must be complied with in order to create a contract."); see also Shell Oil Co. v. Kelinson, 158 N.W.2d 724, 728 (Iowa 1968) (citing Restatement § 60), and of the parties to a contract to assign the risks associated with the contract. The statement in the purported agreement that *747 the parties would not be bound until acceptance clearly required the risks be assigned based on the status quo before contract negotiations until the agreement was, as it were, "signed, sealed, and delivered." Thus, because the purported agreement is clear as to the intent of the parties not to be bound, the jury should not have been asked to determine that issue.
We believe this finding comports with the spirit and the purpose of section 321.493. That statute is designed to absolve certain parties from liability and to fix liability on other parties. It removes the problem of registration of the certificate of title, but it imposes a minimum threshold of a bona fide sale or transfer. Preliminary negotiations or mere willingness to enter into a bargain do not rise to that level. By this we neither restrict nor expand the persons upon whom liability should be placed, but attempt to bring into focus who among the possible parties should assume or remain responsible for the negligence of a driver.
Finally, we are unconvinced by appellee's assertion that there was an agency relationship between appellant and his son. We find the following guidance in our case law:
The burden of proving an agency relationship is upon the party asserting its existence....
An agency results from the manifestation of consent by one person, the principal, that another, the agent, shall act on the former's behalf and subject to his control, and consent by the other so to act.
* * * * * *
An agency may be proven not only by direct evidence of an agreement between the parties but also by circumstantial evidence, such as their words and conduct, from which an intention to create an agency may be fairly implied.... The Question of whether there was a principal-agent relationship ordinarily is one of fact.
[A]s the case was tried at law, our review is limited to determining whether substantial evidence supports the trial court's finding that an agency relationship existed.
Kanzmeier v. McCoppin, 398 N.W.2d 826, 830 (Iowa 1987) (citations omitted). We find no such substantial evidence of record in this case. While it might be feasible to find an agency relationship in appropriate circumstances, the fact of the matter is that none of the parties to the purported agreement believed such an agency existed. Nor did they conduct themselves in such a manner that even an objective observer would believe that one existed. Because the dealership insisted upon appellant's signature before having the offer submitted for approval and acceptance, it clearly did not believe that Randy had any actual or apparent authority to consummate the deal and create binding rights between appellant and the dealership. It also is abundantly obvious that neither appellant nor his son Randy believed Randy had the powers of an agent.
We believe the evidence clearly shows that appellant was entitled to a directed verdict on the issue of ownership because appellee failed to prove that there was an enforceable contract between appellant and the dealership. Thus, the evidence failed to present a jury question on the issue of whether appellant was an owner of the vehicle. Because our holding is dispositive, there is no need to address the other issues presented. The judgment should be reversed and the cause remanded with directions for the trial court to enter a directed verdict for appellant.
REVERSED AND REMANDED.
HAYDEN, J., concurs.
SACKETT, J., dissents.
SACKETT, Judge (dissenting).
I would hold that sufficient evidence existed to support a finding the father had an ownership in the automobile. Furthermore, I agree with the trial court the father was not released. A release of one tortfeasor should not release the others when an express reservation is made.
*748 Iowa Code section 668.7 provides that a release entered into by a claimant and a person liable discharges that person from all liability, but does not discharge any other persons liable upon the same claim unless it so provides. I would hold that this code section controls this situation.
NOTES
[1] As we note below, we are not entirely convinced that an offer was extended, much less a contract. We would be loath to impose liability on one who merely proposes to enter into a contractual obligation, especially one who, for all practical purposes, does not yet know or has not adopted the contents of the purported offer.
[2] Were we to find that there had been agreement and that title had passed under these facts, we would be imposing much too heavy a burden on anyone who proposes to be bound by a contract. It is one thing for an agreement between two equally informed parties working together on preliminary matters to ripen into an enforceable contract, for which Appellees cite Severson v. Elberon Elevator, Inc., 250 N.W.2d 417, 420 (Iowa 1977); it is quite another to impose a contract when the supposed offeror has not seen the offer and both parties and the agreement itself indicate that there will be no binding contract until it is signed and finally accepted. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583034/ | 51 F. Supp. 889 (1943)
AMERICAN CASUALTY CO. OF READING, PA.,
v.
MORRIS et al.
Civil Action No. 19-F.
District Court, N. D. West Virginia.
September 30, 1943.
*890 Oscar J. Andre, of Clarksburg, W. Va. (Steptoe & Johnson and James M. Guiher, all of Clarksburg, W. Va., on the brief), for plaintiff.
Ernest R. Bell, of Fairmont, W. Va., for defendant David G. Morris.
Marion Meredith, of Fairmont, W. Va., for defendants Fred Motter and John Simon, administrator of Gerald Simon's estate.
HARRY E. WATKINS, District Judge.
This is a declaratory judgment action in which the American Casualty Company of Reading, Pennsylvania, has moved for summary judgment. Decision of the case turns upon the interpretation of a policy of casualty insurance issued by plaintiff to defendant, David G. Morris. More specifically, the issue is whether the negligent operation of the truck by an employe of Morris, resulting in the death of one *891 passenger and injury to another is within the coverage afforded by the policy.
Two actions have been instituted in the West Virginia court against Morris to recover damages for death and injury to these passengers. In order to settle the controversy over the interpretation of the policy, the casualty company brought this suit in the district court for a judgment declaring that the policy did not cover the liability, if any, of Morris, in the circumstances stated, and that it was not obligated nor liable in any way to defend the suits in the state court, nor to pay any judgment that might be rendered in them.
Plaintiff based its motion for summary judgment upon the following undisputed facts: It had issued an automobile liability indemnity policy to David G. Morris on a truck owned and used by him as a common carrier in the transportation of coal, stone and other such commodities for hire, and as a contract carrier of brick for Hammond Fire Brick Company. About October 3, 1942, Morris and Motter left their homes at Fairmont, W. Va., to go on a camping and fishing trip to a place near Glenville, W. Va., a distance of about 85 miles. They traveled in an automobile owned by Morris. The trip was solely for pleasure and in no way connected with the business conducted by Morris. After traveling about 45 miles the automobile became disabled, but the two managed to get a ride to their camping destination. Morris sent a message to one Anderson, his employe, requesting him to bring the truck in question in the evening of October 6, after Anderson had finished his day's work, to the place where they were camping for the purpose of taking them back home and of towing the disabled automobile back to Fairmont. Pursuant to this request, on the evening specified, after completing his day's work, Anderson drove the truck in question from Fairmont to the place where Morris and Motter were camping, passing the place where the disabled automobile was located. No goods or merchandise were transported in the truck on this occasion. Without the knowledge of Morris, Anderson took two young men, Wilborn Farmer and Gerald Martin Simon, with him as company on the trip. Farmer and Simon made the trip solely for their own pleasure as guests of Anderson. About 9:30 o'clock that same evening Morris, Motter, Anderson, Farmer and Simon left the camp and started back to Fairmont, all of them riding in the truck, with Morris driving. After traveling about three or four miles, and before reaching the place where the disabled automobile was located, the truck skidded off the road while rounding a curve. The truck went over a steep bank, resulting in the death of Simon and injuries to Motter. No other vehicle was in any way involved in the accident.
Chapter 24A of the West Virginia Code places the supervision and regulation of motor carriers in the Public Service Commission. Paragraph (g), Article 5, Section 5 of that chapter gives the commission power to require motor carriers to file with the commission a surety bond or policy of insurance, or other security "* * * for the reasonable protection of the traveling, shipping, and general public against injury, loss, damage, or default for which such carrier may be liable, and prescribed rules and regulations governing the filing of evidence of such insurance and such security with the commission. In fixing the amount of such insurance policy or policies, * * * the commission shall give due consideration to the character and amount of traffic, the value of the property transported, the number of persons affected, and the degree of danger involved in any such motor carrier operation."
By virtue of such authority the commission has prescribed certain rules and regulations concerning the issuance of permits to motor carriers. Rule 1 requires the motor carrier to file with the commission a policy of insurance or surety bond or other security conditioned to pay "* * * any final judgment recovered against such motor carrier for bodily injuries to or the death of any person resulting from the negligent operation, maintenance, ownership, or use of motor vehicles under such certificate or permit, or for loss or damage to property of others; * * *".
In order to meet these requirements and to qualify him as a carrier, Morris applied for and received the policy in question. One of the endorsements on the policy designated as "Exclusion of Passenger Hazard", is as follows: "In consideration of the premium at which this policy is written, it is agreed that such insurance as is afforded by the policy for Bodily Injury Liability and for Property Damage Liability does not apply to bodily injury, including death at any time resulting therefrom, *892 or damage to property sustained by any person while in or upon, entering or alighting from the automobile."
The premium actually charged by the plaintiff for that portion of the policy involved in this case, covering bodily injury liability, was $20.80. Had this exclusion of passenger hazard endorsement not been attached to the policy, the premium covering bodily injury liability which would have been charged by plaintiff would have been $35.25. It is this endorsement which forms the basis of plaintiff's denial of liability. The injured persons were both passengers, riding on the truck, and, unless there is some other provision superseding this endorsement, the policy would clearly furnish no coverage for these particular injuries.
Defendants contend that another endorsement attached to the policy (M. C. Form 13) provides such coverage. This endorsement is one which the Public Service Commission requires to be attached to all policies of insurance issued upon motor carriers used in the business of motor carriers. The pertinent part of this endorsement is as follows:
"The policy to which this endorsement is attached is an automobile bodily injury liability and property damage liability policy and is hereby amended to assure compliance by the Insured, as a motor carrier of passengers or property, with the pertinent rules and regulations of the Public Service Commission of West Virginia, promulgated in accordance with the provisions of Paragraph (g), Section 5, Article 5 of the Motor Carrier Law."
"In consideration of the premium stated in the policy to which this endorsement is attached, the company hereby agrees to pay any final judgment recovered against the Insured for bodily injury to or the death of any person * * * * *, resulting from the negligent operation, maintenance, ownership, or use of motor vehicles under certificate of convenience and necessity or permit issued to the Insured by the Public Service Commission of West Virginia, or otherwise under the Motor Carrier Law, * * *. The liability of the company extends to such losses, damages, injuries or deaths whether occurring on the route or in the territory authorized to be served by the Insured or elsewhere, except as follows: No exceptions."
"Nothing contained in the policy or any other endorsement thereon, nor the violation of any of the provisions of the policy or of any endorsement thereon by the Insured, shall relieve the company from liability hereunder or from the payment of any such final judgment."
"The Insured agrees to reimburse the company for any payment made by the company on account of any accident, claim or suit involving a breach of the terms of the policy, and for any payment that the company would not have been obligated to make under the provisions of the policy, except for the agreement contained in this endorsement."
Uncontroverted facts make it clear that at the time of the accident the truck was not being used for a purpose which required a motor carrier permit from the Public Service Commission. It was not being used to transport either persons or property for hire. While it was licensed and permitted to do so, at the time of the accident it was not actually being operated or used "under certificate of convenience and necessity or permit issued to the Insured by the Public Service Commission of West Virginia, or otherwise under the Motor Carrier Law", as provided in M. C. Form 13 endorsement. Defendants take the position that this endorsement is applicable, and supersedes all other provisions in the policy, without regard to whether the truck was being used in its business and under its permit as a motor carrier at the time of the accident. It may be that this endorsement would supersede all other provisions and endorsements in the policy, including the "Exclusion of Passenger Hazard" endorsement, for accidents occurring while the truck was in actual use as a motor carrier under its permit, or the Motor Carrier Law. Had the truck been transporting property for hire, or transporting brick as a contract carrier under its motor carrier permit, at the time of the accident in question, it may be that endorsement M. C. Form 13 would be applicable and would nullify the effect of the "Exclusion of Passenger Hazard" endorsement. This question is raised but not answered in Hawkeye Casualty Co. v. Halferty, 8 Cir., 131 F.2d 294, 299; Id., 63 S. Ct. 533, 87 L.Ed. ___. But here plaintiff says that the truck was not being used for a purpose requiring a permit from the Public Service Commission as contemplated by the statute; that, consequently, *893 the endorsement "M. C. Form 13" does not apply; that the contract of the parties controls; and by virtue of the exclusion of passenger hazard provision there is no coverage and no obligation on the part of plaintiff to defend Morris in any action arising out of the accident or to pay any judgment rendered against him in such accident. I am of the opinion that this construction of the contract by plaintiff is correct.
There is no statute in West Virginia which requires compulsory insurance upon motor vehicles used for private purposes. The statute cited applies only to motor vehicles being operated as "motor carriers" and while being used as such. The intent of the Legislature is shown in the first paragraph of the statute in which the purposes of the statute are stated "* * * to: (a) protect the safety and welfare of the traveling and shipping public in their use of transportation agencies by motor vehicle; (b) preserve, foster, and regulate transportation and permit the coordination of transportation facilities; (c) provide the traveling and shipping public transportation agencies rendering stabilized service at just and reasonable rates." The statute authorizes the commission to require insurance "* * * for the reasonable protection of the traveling, shipping, and general public against injury, loss, damage, or default for which such carrier may be liable." In fixing the amount of insurance to be carried, the commission shall give due consideration "* * * to the character and amount of traffic, the value of the property transported, the number of persons affected, and the degree of danger involved in any such motor carrier operation". Ch. 24A, Art. 2, Section 2 provides: "No common carrier by motor vehicle shall operate any motor facility for transportation of either persons or property for hire on any public highway in this state except in accordance with the provisions of this chapter * * ". This indicates an intent to exclude from the provisions of the statute any motor vehicle when not transporting either persons or property for hire. The same intent is even more definitely shown in Rule I promulgated by the commission pursuant to such statutes, wherein it requires an insurance policy or other security "conditioned to pay * * * any final judgment recovered against such motor carrier for bodily injuries * * * resulting from the negligent operation, maintenance, ownership, or use of motor vehicles under such certificate or permit". The endorsement relied upon by defendants, M. C. Form 13, required by the commission, contains the same pertinent language. Repeated use of the words "motor carrier", "such carrier", "for hire", "such motor carrier operation", "motor carrier of passengers and property", and "under such certificate or permit" indicates the intent of the Legislature and the commission to apply them to motor carrier operations only.
Defendants rely upon the third paragraph in the endorsement M. C. Form 13, to the effect that "Nothing contained in the policy or any other endorsement thereon, nor the violation of any of the provisions of the policy or of any endorsement thereon by the Insured, shall relieve the company from liability hereunder or from the payment of any such final judgment." They interpret this to mean that nothing in the policy or any endorsement shall relieve the company from any liability imposed by law upon Morris as a result of accidents occurring in the operation or use of his truck, whether such truck was engaged in his business as a common carrier or otherwise. Such a construction completely ignores the word "hereunder", as well as the purpose of the Motor Carrier Law. The prohibition of the endorsement is that no provision in the policy or any other endorsement shall relieve the company from liability hereunderthat is, liability "resulting from the negligent operation, maintenance, ownership, or use of motor vehicles under certificate of convenience and necessity or permit issued to the Insured by the Public Service Commission of West Virginia, or otherwise under the Motor Carrier Law", as fully set out in the next preceding paragraph of the endorsement. The effect of the language used was to invalidate any attempt on the part of the casualty company to limit by contract its liability resulting from operation of the truck in the owner's business as a common carrier. The language used did not operate to extend the liability imposed upon the insurer by the preceding paragraph of the endorsement, but to prevent limitation of that liability. Travelers Insurance Company v. Caldwell, 8 Cir., 133 F.2d 649, 655; Foster v. Commercial Standard Ins. Co., 10 Cir., 121 F.2d 117. See also 7 Appleman, Insurance Law and *894 Practice (1942) Section 4470, wherein this recent publication states the applicable rule as follows: "The standard commission endorsement to the effect that nothing contained in the policy or any endorsement thereto should relieve the insurer of liability thereunder does not operate to change the terms of the contract prescribed by statute so as to cover a truck when not engaged in operations of the carrier. It is no purpose of the act to require insurance for use other than for the purpose for which the protection under the act was designed." It was not the purpose of the Legislature or the commission to interfere with the operation of motor vehicles when not in fact transporting persons or property for hire. Caines v. Wheeler, 207 Ky. 237, 268 S.W. 1098; Motor Car Indemnity Exchange v. Lilienthal, Tex.Civ.App., 229 S.W. 703. The words used in the endorsement must be interpreted in the light of the power and authority of the Public Service Commission. When so interpreted they cannot control other provisions of the policy in no wise connected with assured's business as a common carrier.
Since the truck was being used for a purpose which did not require a permit, it was not being operated under such a permit or the Motor Carrier Law, and M. C. Form 13 does not apply. The effect of this is to leave the parties in the same position they would be had the truck never been used as a motor carrier. As such they had the right to, and did, enter into their own private contract of insurance. In the contract agreed upon was the endorsement excluding coverage to any person "while in or upon, entering or alighting from the automobile". Morris was evidently attempting to comply with the motor carrier law with the least expense possible. As long as he was only hauling brick and other low grade commodities as distinguished from passengers, the risk assumed by the casualty company was not great. By inserting the endorsement excluding the passenger hazard, the company could write the policy for a little more than half the ordinary cost, and this they agreed to do. "The risk upon the insurer in covering liability for injuries to passengers is entirely different from that assumed concerning liability for injuries to freight". Hawkeye Casualty Company v. Halferty, supra [131 F.2d 299]. Insertion of M. C. Form 13 to assure that nothing in the policy limited the liability of the casualty company while the truck was engaged in the trucking business as a common carrier, fully complied with the common carrier law.
A late case directly in point is the Halferty case, cited above, in which the Supreme Court denied certiorari in February, 1943. In order to qualify certain trucks as common carriers under regulations of the Public Service Commission of Missouri, the casualty company issued its policy of insurance. The commission required an endorsement similar in effect to that required in West Virginia, which contained a provision by which the insurer agreed to pay any final judgment rendered against the assured for personal injuries or death caused by any vehicle operated pursuant to the certificate issued by the commission. (In the case at bar the word "under" is used instead of the word "pursuant"). The endorsement, by its terms, took precedence over any other provision or endorsement attached to the policy. Another endorsement, similar to the one here, excluded liability for injuries or death sustained by any person while riding in or upon the trucks covered by the policy. On the face of the policy appeared the statement that the motor vehicles insured were to be used for commercial purposes. The term "commercial" was defined as "use principally in the business occupation of the named insured as stated in item 1(e), including occasional use for personal, pleasure, family and other business purposes". One of the trucks and a driver was furnished to a neighboring farmer for hauling farm products from one place on his farm to another, requiring the occasional use of a public highway. This use of the truck was of a commercial nature, since it was under contract for hire, but the use was one which did not require a permit from the Missouri Commission. After work had been completed, the driver was returning to town where the truck was kept. Riding in the truck as guests of the driver were 18 or more of the farm laborers. An accident occurred and several of them were injured, one fatally, resulting in a number of suits. As here, the casualty company declined to defend the suits on the ground that the liability, if any, was not covered by the policy. It claimed that the exclusion clause relating to persons riding in the truck absolved it from liability. In order to settle the controversy, the casualty company, as here, *895 brought suit in the district court for a judgment declaring that the policy did not cover liability, if any, in the circumstances stated, and that the casualty company was not obligated to defend the suits in the state courts nor pay any judgment that might be rendered. The district court decided against the insurance company, which appealed. The Circuit Court of Appeals reversed the judgment. It held that since the truck was engaged in a use which, though commercial, did not require the consent of the commission, the endorsement required by the commission was not applicable; and that by reason of the exclusion of passenger hazard endorsement, there was no coverage. The court said: "We are of the opinion that the appellant's construction of the insurance contract is the only one permissible. It is not denied that the only jurisdiction or power in the Missouri Public Service Commission with reference to the insurance involved here concerns the operation of motor vehicles as common carriers. Parties not engaged in such an operation are not required by the laws of Missouri to carry any insurance. It follows that under Missouri law the parties to the insurance contract were at liberty, so long as not operating as common carriers, to make any contract of insurance they thought proper or to limit the coverage in any contract made as their interests might dictate. Only as to their business as common carriers were the appellees required to take and the appellants to deliver insurance conditioned as required by the Missouri law. Since the jurisdiction of the Public Service Commission over the character of insurance carried by persons operating automobiles in Missouri extended only to the operations of common carriers, it must be assumed that the Commission did not attempt to exercise any power or authority over motor vehicles not being operated as common carriers. No reason appears why a common carrier operating motor vehicles in Missouri might not, after complying with the laws of Missouri in reference to insurance, applicable to its business, carry such other and further insurance as it deemed wise, or necessary to its protection. The endorsement of the Missouri Public Service Commission applied only to motor vehicles operated in the business of common carriers and was without application in the case of a motor vehicle not so used or operated."
The court considered the word "pursuant" in the Missouri endorsement synonymous to the word "under" in the West Virginia endorsement, for it said at page 299 of the opinion in 131 F.2d: "Since the truck involved in the accident under consideration was not engaged at the time of the accident as a common carrier of freight under the appellees' certificate of public convenience and necessity, the endorsement of the Missouri Public Service Commission, limited to such operations, has no application * * *. The situation in all respects is as if the appellees were not engaged as common carriers, and as if no such endorsement was contained in the policy."
In the case under consideration the policy stated that the purposes for which the truck was to be used were "commercial", which is defined as "use principally in the business occupation of the named insured * * * including occasional use for personal, pleasure, family and other purposes". Defendants contend that under this definition the truck was being used for a commercial purpose at the time of the accident, and that, if the use was commercial, the commission endorsement was applicable. I cannot subscribe to this conclusion. It is clear that the truck was being used for commercial purposes under the definition of the policy. This means that the truck was being used for the permissible purposes stated in the policy. It does not follow that if the use was commercial within the definition of the policy, that it was, therefore, a use under the motor carrier permit or certificate of convenience, or putting it another waya use for which such a permit was required. Hawkeye Casualty Co. v. Halferty et al., supra.
Defendants argue that their construction of the policy is supported by the last paragraph in the endorsement by which the insured agrees to reimburse the casualty company for any payment made which it would not have been obligated to make under the provisions of the policy, except for the agreement in the endorsement. Such provision was not intended to cover the situation which we have here. It was inserted to assure the existence of coverage when the truck was being used in the business for which the permit was required, irrespective of any violation by the assured, which would otherwise defeat coverage, such as violation of statutes or provisions *896 of the policy with respect to age of the driver, failure to give prompt notice of the accident, failure to cooperate in investigation and many others.
It is difficult to find cases so nearly in point as the Halferty case, cited above, on account of the difference in statutes and commission regulations in the various states. While not directly in point, the opinions in the following cases, in addition to those cited, support the conclusions herein reached: Smith v. Republic Underwriters, etc., 152 Kan. 305, 103 P.2d 858; Schoonover v. Clark et al., 130 P.2d 619, 155 Kan. 835; Flythe v. Eastern Carolina Coach Co., 195 N.C. 777, 143 S.E. 865; Basta v. United States Fidelity & Guaranty Co., 107 Conn. 446, 140 A. 816. The following cases cited by defendants can be distinguished for the reason that each of them involves accidents which occurred while the vehicle was being used for the very purpose for which a permit or certificate of convenience was required: Central Mutual Ins. Co. v. Tartar, 6 Cir., 92 F.2d 839; Central Mutual Ins. Co. v. Pippen, 271 Ky. 280, 111 S.W.2d 425; Continental Casualty Co. v. Shankel, 10 Cir., 88 F.2d 819; American Fidelity & Casualty Co. v. Big Four Taxi Co., 111 W. Va. 462, 163 S.E. 40; Black & White Cab Co. v. New York Indemnity Co., 108 W. Va. 93, 150 S.E. 521; Worrell v. Worrell, 174 Va. 11, 4 S.E.2d 343. It should also be noted that the endorsement involved in the Tartar and Pippen cases is much broader than the West Virginia endorsement, and that in these cases the suit was not founded on the requirements of the Motor Vehicle Act and rules of the Public Service Commission of Ohio, but on a contract for the benefit of "any person injured or killed through the negligent operation of the truck" [92 F.2d 840]. In Travelers Mutual Casualty Co., etc., v. Thornsbury, 276 Ky. 762, 125 S.W.2d 229, the court held the limitation of coverage contained in the policy was superseded by the statutory endorsement, and that it was immaterial that the accident occurred while the cab was being used for a private purpose. In reaching its decision the court relied strongly upon the Tartar and Pippen cases which involved Ohio trucks and in which the Kentucky statute did not figure, notwithstanding the important distinction that in the Tartar and Pippen cases the vehicle was being used for a purpose for which a permit was required. An examination of these cases leads me to believe that the Tartar and Pippen cases are not authority for the holding in the Thornsbury case. It is difficult to analyze the Thornsbury case because the Kentucky statute, if considered, was not quoted. However, it seems to be in conflict with the Halferty case, and the great weight of authority. The case of Rusch v. Mielke et al., 234 Wis. 380, 291 N.W. 300, can be distinguished because of the difference in the statutes of Wisconsin and West Virginia relative to the insurance coverage of the carriers. The Wisconsin statute provides indemnity for any damages recovered against the "owner or operator of each such motor vehicle by reason of the negligent use or operation thereof". St.1939, § 194.41. There is no language indicated that the provision is to apply only when vehicles are used as motor carriers such as are contained in the West Virginia statutes.
Defendants Motter and Simon say that the "Exclusion of Passenger Hazard" endorsement was illegal. This defense was mentioned for the first time in the oral argument. Without any mention of this defense in any of the pleadings, plaintiff and defendants, Motter and Simon, have offered affidavits on this issue, without objection or claim of surprise by anyone.
The defense of illegality must be affirmatively pleaded. Rule 8(c), Federal Rules of Civil Procedure, 28 U.S.C.A. following section 723c. But failure to plead an affirmative defense is immaterial if evidence of the defense is introduced and not objected to for failure to plead it, and no surprise is claimed. Tillman v. National City Bank of New York, 2 Cir., 118 F.2d 631. This means that the question of illegality is an issue in this case and must be decided.
Illegality is claimed because it is said that Edgar B. Sims, Insurance Commissioner of West Virginia, had not given his approval to the endorsement. The insurance company contends that such endorsement was submitted to the insurance commissioner and duly approved for use in West Virginia. Permission was given all parties to submit additional evidence upon this factual question and the case was then submitted to the court for final determination upon the merits as to all questions of law and fact.
An examination of the evidence on this issue convinces me that prior to the inclusion of this endorsement in the policy *897 in question, the same was duly approved by the Insurance Commissioner of West Virginia and notice given to the insurance company by such commissioner that such endorsement was duly filed in his office for future use in West Virginia. The defense of illegality is without merit.
The evidence submitted upon this issue shows that the Insurance Commissioner of West Virginia disapproved generally of provisions in policies of casualty insurance which exclude from coverage, liability for guests in a motor vehicle, and on March 5, 1936, he issued a ruling forbidding such exclusion of coverage. On March 4, 1940, the insurance company wrote the commissioner asking his approval for the rating of all dump body trucks as commercial class 4, "such rating to exclude coverage for passengers * *". On March 7, 1940, the commissioner gave his approval by stamping upon such letter the words "Filed for use in the State of W. Va. on and after this ___ day of ____, 19__. (Signed) Edgar B. Sims March 7-1940 State Auditor Insurance Commissioner". On or about October 1, 1941, the commissioner issued "Departmental Ruling No. 4", the effect of which was to establish minimum policy requirements, and required all casualty insurance companies to submit to the commissioner for approval on or before December 31, 1941, copies of forms of all policies and endorsements to be used by such companies in West Virginia on and after January 1, 1942. Accordingly, plaintiff wrote the insurance commissioner a letter enclosing its form of policy and a number of endorsements which it proposed to use in West Virginia on and after January 1, 1942. The letter stated that such endorsement forms were submitted for his approval, and enclosed a copy of each form, as well as a list of all forms submitted, such list showing the number and name of each endorsement. At the top of the second page of the list of endorsements, this particular endorsement was listed and described as follows: "P152-Exclusion of Passenger Hazard". Thereafter the commissioner's office approved plaintiff's policy and all the endorsements except two, one of which was disapproved, and the other was returned for further procedure. As evidence of approval of the endorsement in question, the following words were stamped upon the endorsement at the office of the commissioner: "Filed for use in the State of West Virginia on and after this 2 day of Jan. 1942. (Signed) Edgar B. Sims State Auditor Insurance Commissioner". The same words were stamped on each page of the list of endorsements, but appropriate words were used to show the two endorsements which had not been approved. Except as to the two endorsements which were not approved, check marks were placed after each endorsement, including the "Exclusion of Passenger Hazard" endorsement. This would clearly indicate that each endorsement was considered separately and either approved, disapproved, or returned for further action.
"Department Supplemental to Ruling No. 4" required insurance companies submitting policy forms and endorsements for approval to certify that they comply with the minimum requirements described in Departmental Ruling No. 4, and in submitting its policy and endorsements plaintiff made such certification. If such policy and endorsement did not meet every necessary requirement, it was the duty of the commissioner to disapprove the same and notify the insurance company, so that it would not use the endorsement in West Virginia in the future. Instead, the insurance commissioner indicated his approval by stamping upon the endorsement appropriate words to show that the endorsement was filed for future use in West Virginia on and after January 2, 1942. The policy in question was issued on August 23, 1942. Plaintiff was entitled to and did rely upon these words and the subsequent action of commissioner as indicating his permission to make use of the endorsement in West Virginia after January 2, 1942. The commissioner states in his affidavit that the expression "Filed for use in West Virginia" is commonly relied upon by insurance companies as indicating permission to make use, in West Virginia, of the form so stamped.
Harlan Justice, a deputy insurance commissioner who is responsible for the approval and disapproval of all insurance policies and endorsements, under direction of the insurance commissioner, stated that the use of the "Exclusion of Passenger Hazard" endorsement in any automobile liability policy written in West Virginia is against the rules promulgated by the Insurance Commissioner of West Virginia. With reference to the specific authority given the plaintiff to use such endorsement, *898 he says that plaintiff's letter dated March 4, 1940, asking approval for the rating of all dump body trucks as commercial class 4, "such rating to exclude coverage for passengers * * *" was received, but was stamped filed for use in West Virginia "through inadvertence and mistake". The letter was brief and specifically points out that the rating excludes coverage for passengers. It is difficult to understand how it could be misunderstood. He states that it was also through inadvertence and mistake that the endorsement in question was likewise stamped filed for use in West Virginia when submitted for approval on December 30, 1941, almost two years later; and that such stamping was done in reliance upon the letter of the insurance company submitting such endorsements for approval, wherein it stated that such endorsements complied with Departmental Ruling No. 4. Again it is difficult to understand how there could be any mistake about the effect of an endorsement, the title of which was "Exclusion of Passenger Hazard". There was no evidence of fraud or intentional misrepresentation on the part of the insurance company.
Irrespective of previous rules or regulations, the commissioner could make the use of the endorsement entirely regular by specific approval. He gave that approval, and its use under such circumstances was not illegal.
A declaratory judgment may be entered for the plaintiff in accordance with the views herein expressed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1918564/ | 730 So.2d 314 (1999)
Michael WHITFIELD, Petitioner,
v.
Harry SINGLETARY, Sec. of, Fl. Dept. of Corr., etc., Respondent.
No. 98-0531
District Court of Appeal of Florida, Third District.
February 10, 1999.
Opinion Denying Rehearing April 21, 1999.
*315 Michael Whitfield, in proper person.
Robert A. Butterworth, Attorney General, and Lara J. Edelstein, Assistant Attorney General, for respondent.
Before COPE, GERSTEN and FLETCHER, JJ.
PER CURIAM.
Michael Whitfield petitions for a writ of habeas corpus, alleging ineffective assistance of appellate counsel. Defendant-petitioner contends that his appellate counsel should have challenged the sufficiency of the evidence to support the four kidnapping convictions in this case. First, defendant's "boilerplate" motion for judgment of acquittal in the trial court did not raise with particularity this issue, and thus did not properly preserve it for appellate review. See Johnson v. State, 478 So.2d 885, 886 (Fla. 3d DCA 1985). But see Griffin v. State, 705 So.2d 572, 573-75 (Fla. 4th DCA 1998) (on facts presented, treating error as fundamental). Assuming that the point had been properly preserved for appellate review, it is without merit. The facts of the present case resemble Faison v. State, 426 So.2d 963 (Fla.1983), and the evidence was sufficient. Defendant relies on the decisions in Berry v. State, 668 So.2d 967 (Fla.1996), and Walker v. State, 604 So.2d 475, 477 (Fla.1992), but they are not controlling here. The Berry decision points out that the Faison test can be satisfied by showing either "movement" or "confinement" of the victims. See 668 So.2d at 970. Neither Berry nor Walker has overruled Faison, see id. at 668 So.2d at 970, 604 So.2d at 477, and we deny the petition on authority of Faison itself.
We find no merit in defendant's remaining claims.
Petition denied.
On Rehearing Denied
PER CURIAM.
In his motion for rehearing defendant reiterates his claim that appellate counsel was ineffective for failing to challenge defendant's predicate offenses for his habitual violent felony offender adjudication. Defendant's direct appeal was decided prior to the enactment of the Criminal Appeal Reform Act, see § 924.051, Fla. Stat. (Supp.1996), and we assume for present purposes that such a challenge could have been raised even though there was no objection to the predicate offenses in the trial court.
The judgments relied on by the State for habitualization were introduced into the trial court record. Among these is an adjudication of guilt for the offense of robbery imposed within five years of the offenses for which the defendant was habitualized. This qualifies defendant as a habitual violent felony offender. See § 775.084(1)(b), Fla. Stat. (1989).
It is true that the defendant was sentenced as a youthful offender for this crime, but that does not preclude its consideration as a predicate offense. That is so because adjudication was imposed, and the defendant was sentenced to a term of incarceration. The habitual offender statute precludes using as a predicate offense an offense for which adjudication was withheld and probation imposed (unless the habitualization offense was committed during the probationary period). See § 775.084(2), Fla. Stat. (1989); Overstreet v. State, 629 So.2d 125 (Fla.1993) (Youthful Offender Act). In this case, however, there was no withholding of adjudication on the robbery offense and therefore the robbery conviction was properly found to be a predicate offense for the habitual violent offender adjudication. It follows that defendant's appellate counsel was correct in not raising this claim in the defendant's direct appeal.
Rehearing denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582043/ | 110 Wis.2d 485 (1983)
329 N.W.2d 161
STATE of Wisconsin, Plaintiff-Respondent-Petitioner,
v.
Rita A. FELTON, Defendant-Appellant-Cross-Petitioner.
No. 80-1458-CR.
Supreme Court of Wisconsin.
Argued September 9, 1982.
Decided February 3, 1983.
*487 For the plaintiff-petitioner the cause was argued by Jeffrey Gabrysiak, assistant attorney general, with whom on the briefs was Bronson C. La Follette, attorney general.
For the defendant-appellant-cross-petitioner there were briefs and oral argument by Robert L. Gruber, Madison.
Affirming in part and reversing in part 106 Wis 2d 769, 318 N.W.2d 25 (Ct App).
HEFFERNAN, J.
This is a review and cross-review of an unpublished court of appeals decision dated December 28, 1981. The appeal to the court of appeals was from a judgment of the circuit court for Portage county, James H. Levi, Circuit Judge. The defendant, Rita A. Felton, was convicted of the second degree murder of her husband, Robert Felton, in violation of sec. 940.02 (1), Stats.
The appeal affirmed the judgment of guilty, but directed that the cause be remanded for the purpose of allowing the defendant to interpose the defense of not guilty by reason of mental disease or defect. The state petitioned this court for review in respect to the remand. The defendant petitioned for a cross-review, asking for a new trial on all issues because of the ineffectiveness of trial counsel. Both petitions were granted by this court. We reverse the conviction and remand for a new trial.
On January 2, 1979, Rita Felton shot her husband while he lay sleeping. She was charged with first degree murder. On July 5, 1979, her attorney filed a motion to amend her plea of not guilty to not guilty by reason *488 of mental disease or defect. On the day the trial began, the plea of not guilty by reason of mental disease or defect was withdrawn. After a lengthy trial, the jury found Rita Felton guilty of murder in the second degree. Her defense was that she was a "battered" spouse who acted in self-defense. After the close of testimony, the trial court instructed the jury on first degree murder, second degree murder, manslaughter (imperfect self-defense) sec. 940.05(2), Stats., and on the privilege of self-defense. There was no request for instruction on heat-of-passion manslaughter under sec. 940.05(1).
Defendant's appellate counsel filed a motion for new trial, which was denied by the trial court after an evidentiary hearing. The appeal to the court of appeals was from the conviction and the denial of the motion for a new trial.
It was contended on appeal that trial counsel was ineffective because he improvidently and without sufficient investigation withdrew the defense that the defendant should be exonerated of responsibility because of mental disease or defect. It was also alleged that counsel was ineffective when he failed, because he was unaware of the law, to consider as a defense the lesser crime of manslaughter heat-of-passion, as provided in sec. 940.05 (1), Stats.
It was also contended on the appeal that the record demonstrated erroneous and prejudicial limitations by the trial judge in counsel's questioning of witnesses in respect to acts of violence by the victim, Robert Felton. It is also urged that the admission of a statement elicited from Rita Felton in violation of Miranda was prejudicial. The court of appeals found the admission of the statement erroneous but not prejudicial; and in respect to the limitation on witnesses, it concluded that the evidence which would have been elicited in respect to *489 Robert Felton's acts of violence was cumulative, and, hence, the exclusion was not prejudicial.
Counsel also argues that the "bridging" instruction which was given in this case and which is applicable when the evidence arguably permits a finding of first or second degree murder or manslaughter, coerces the jury into returning a murder, rather than a manslaughter, verdict.
On this review we hold that trial counsel was ineffective, and accordingly the verdict and conviction must be set aside and a new trial ordered. We reverse that portion of the decision of the court of appeals that sustained the conviction adjudging guilt.
Because the defense proffered by Rita Felton was that she was a battered spouse and because she recounted that her maltreatment had persisted throughout almost the entire course of her twenty-three-year marriage with Robert, the facts developed at trial are extensive. We recount some of them, because they are essential to an understanding of her defense and to her defense which ought to have been undertaken or ought to have been considered had counsel been effective.
Rita testified that Robert commenced beating her after they had been married for about six months. He beat her during the course of her six pregnancies and on one occasion she miscarried. On another he beat her, held her down, and threatened to burn her with a blowtorch. On occasions she would wake up and find that Robert was choking her. One time he struck her with his fist so hard that her upper denture broke and it cut through her lip. On various occasions he threatened to kill her. She was forced to commit sexual acts which she considered degrading. Several times the police were called to quell these acts of domestic violence. The police were called either by the older children or by neighbors who heard the disturbances. She testified that she was frequently *490 bruised, and on one occasion she had several broken ribs.
In 1977, after Robert had severely beaten her, the police department removed Rita and the children from the house, and she hired a lawyer and filed for divorce. The Feltons were separated for about ten months. She testified that they got back together again because Robert was attempting to be nice to her and because she was having financial problems. Robert also persuaded her that the children would have fewer disciplinary and school problems if he were around to take care of them.
Rita testified that she had received counseling from a clergyman and was told that she should be a better wife. She stated that she felt guilty about the family problems and had the feeling that if she were a better wife Robert would not conduct himself in the way he did and would not beat her.
Apparently the relations between Robert and Rita and the rest of the family were comparatively tranquil during part of 1978; but, according to Rita's testimony and that of the children, around September of 1978 Robert's violence commenced to escalate. He struck the children and choked Greg, the seventeen-year-old son. During November and December, according to Rita, the situation got even worse. She said that Robert would wake up in the middle of the night and without provocation would commence to beat her.
She said that, about two or three weeks prior to the shooting, Robert beat her because their fifteen-year-old, Rhonda, was doing poorly in school. Rita testified that she attempted to commit suicide that night by taking a whole bottle of Librium. Greg, the seventeen-year-old, testified that his father had struck him a number of times, sometimes with his fist, and that in November and December, there were more fights and pummelings than usual.
*491 Rhonda testified her father beat her frequently and that he commenced beating her when she was twelve or thirteen years old. At the end of November, she said her father was angry more often than usual and hit her almost every day.
There was testimony that on an earlier occasion, without apparent provocation, Robert got a gun and shot a visitor to the house in the leg.
The trial court refused to allow other non-family witnesses to testify about specific acts of violence by Robert against Rita or the children. Two neighbors, however, were allowed to testify to Robert Felton's reputation. One said he had the reputation for getting drunk and abusing his wife and his family. The other said his reputation was that he was mean and beat up his children.
The shooting occurred on the evening of January 2, 1979. That day was the ninth birthday of the two youngest children, Kim and Kelly. Rita testified that she and Robert went to the bank that morning to cash her AFDC check. The record showed that, because of advanced emphysema, Robert was totally disabled from performing his work as a concrete worker. He received a disability payment from the Social Security Administration; and Rita was the recipient of some AFDC assistance.
After cashing the check, they both went to a bar and drank beer. Rita went to a bakery and ordered birthday cakes for the twins and then stopped at a bar. When Robert came into the bar, Rita said he looked furious and that his tone of voice was "scary." After they returned home, the altercation continued, and Robert continued to shout at her because the snowmobile suits they had bought for the twins were too large. Rita said that, because she was scared, she asked Charles, her nineteen-year-old son, to stay. Charles, however, left the house to return to his own living quarters.
*492 A fight then ensued between the deceased and Rhonda, the fifteen-year-old. According to Rita's testimony, after the fight Rhonda's lip was bleeding.
Greg, the seventeen-year-old, testified that, when his parents returned, it was obvious to him that both of them had been drinking. He also stated that his father and Rhonda got into a fight, which he broke up. Shortly thereafter, he left the house. Rhonda also testified that both of her parents were drunk and that her father was angry with her mother, and later her father came after Rhonda, hit her with his fist, and split her lip, and that Greg then came in and pulled the father off of Rhonda. She left the house with Greg.
Rita testified that she was frightened after Greg and Rhonda left the house and that Robert started yelling at her because the children were "brats." Robert followed her into the kitchen and took a swing at her, but at that point the nine-year-old twins grabbed Robert and pushed him away and into the livingroom.
Rita stated that at about 8 or 8:30 p.m., she went into her bedroom. She testified that she was scared and shaking. She testified, "Everything was everything was just it just looked it was like a powder keg, like something's gonna blow." She thinks she slept for a little while.
Then she got up, went to the kitchen, and looked in on Robert, who was sleeping on the couch. She stated that she went back and sat on her bed and was scared because Robert often woke up in the middle of the night and on some occasions when he woke up he would beat her. She was afraid that if he woke up he would kill her. She said that she never felt the way she felt that night it was more than just being scared.
She testified that she remembered sitting on the bed holding Robert's .22 caliber single shot rifle. She stated that she debated what to do, and she testified that she *493 knew there was no other way out without Robert killing her or the children. She said that she knew that she would be arrested but at least the children would be taken care of and that the twins would be placed in a foster home so they could have a real family life.
On cross-examination, Rita said that she knew then that she had to kill him and that she knew that it was wrong. She stated that she did not want to kill him but that she had to. She said she does not remember firing the shot, but she remembers standing by the couch with the gun against her shoulder and she remembers feeling the trigger. The next thing she said that she remembered was lying down on her own bed. She said she was still scared because she thought Robert would come and kill her. She heard footsteps in the hallway, but they stopped; and she testified that then she heard Robert snoring. The next thing she remembered was seeing Greg and Rhonda. She testified that, at that time, she was in a daze. She remembers that she called the police and remembers seeing the police come, but she does not remember making any statements to them. On re-direct examination, she testified that she intended to kill Robert.
Greg testified that he and Rhonda returned to the house at about 9 or 10 o'clock. He said that his father was yelling at his mother, and then Greg watched television for a while and then went to bed. He said that at this time his mother was in her bedroom and that he talked to her there. Greg stated that he thought he went to bed at about 10:30 p.m. He later heard a thud, woke up, and found his mother in the kitchen. She told him she "shot your dad." He told her to call an ambulance, but she followed him into his bedroom. Greg said Rhonda got up at about that time and she also told Rita to call an ambulance. He said his mother was in a daze and was weeping.
*494 Rhonda testified that, after she had gone to bed, she heard a noise and when she looked at her father he was making a noise like he was snoring. She then again looked at her father and, upon seeing the injury, told her mother to call an ambulance. When Rita did not, Rhonda called a neighbor, who came over and told Rita to call the police. Rita picked up the phone and then put it down and said, "I did that for you kids." The neighbor testified that when he came over and he asked Rita if she was going to call the police, she said "no" she wanted Robert to die. The neighbor testified that Rita said she was sick of being beat up all the time and that she shot him for the twins' birthday so they would not have to live with him. After Rita made the call, the police arrived and took her into custody.
Officer Kraklow, who came to the house, testified that Rita Felton said she pointed the gun between her husband's eyes and pulled the trigger but he would not stop breathing. He testified that Rita was calm and that she told him she had been living like this for twenty-three years and was glad that it was over.
After Rita was taken to the police station, she was given the Miranda warnings. She said she would not make a statement. Nevertheless, the officer asked her how long she had contemplated this, and she said, "A long time." Another officer testified that, when she was washing her hands to be fingerprinted, Rita said that, "I should have finished the job right away."
The principal defense witness was Dr. Joy Kenworthy, a clinical psychologist. She recounted that she had heard Rita's in-court testimony and said that she had spent over twenty-five hours in consultation with her. The essence of her testimony was that Rita's experience was typical of a battered spouse and that the evidentiary picture of Robert was typical of an assailant.
*495 She explained the mutual dependency of persons in such a relationship that an assailant such as Robert developed a dependency on the victim and that he felt he could not survive without her. On the other hand, over the years, one in the position of Rita had guilt feelings and became detached from reality in order to tolerate the unrelenting tension and fear. This, the witness said, explained Rita's calmness on the night of the shooting. Dr. Kenworthy stated that Rita was in a state that anyone would be in under similar circumstances. Dr. Kenworthy acknowledged she did not know the legal standard for non-responsibility for one's acts. She did state, however, that Rita functioned automatically to survive, and that her aggressive response was not in fact consciously thought out. On cross-examination, Dr. Kenworthy stated that Rita was not aware of her real reasons for her actions and the explanations given to the police officers were inaccurate.
Dr. Frederick Fosdal, a psychiatrist, appeared as a witness for the state. He testified that the killing stemmed from the very unusual and pathological marriage and that the shooting was the culmination of years of marital discord.
The jury returned a verdict of second-degree murder. Subsequently, appellate counsel brought a postconviction motion under sec. 974.06, Stats., based primarily upon the allegation that trial counsel was ineffective. An evidentiary hearing was held, at which the trial counsel testified.
The trial attorney acknowledged that he was not well versed in the criminal law. He stated that, although he had practiced law for over three years, it had not been in Wisconsin and that he had never handled an entire felony case. This case became his responsibility on the first day he actually assumed the duties as a public defender. He acknowledged that he was probably incompetent to handle *496 a case of this magnitude. He stated that he attempted to get experienced private counsel appointed, but his superiors encouraged him to undertake the defense. The administrators of the public defender's program provided him with the assistance of a more experienced attorney; but according to the trial attorney, he had only limited opportunity to consult with that attorney until just before the time of the trial.
He testified that his theory of defense was self-defense based upon the fact that he perceived, correctly as the record showed, Rita Felton as a battered spouse. He acknowledged that he was ignorant of the possible defense afforded by the Wisconsin law under sec. 940.05 (1), Stats., manslaughter heat-of-passion.
He also admitted that in his focus upon self-defense he never discussed the problems of mental disease or defect with Dr. Kenworthy. He was aware of the fact that Dr. Kenworthy did not hold herself out as a forensic psychologist and that it would be his responsibility as defense counsel to explain legal consequences to the psychologist, but he never did so.
Counsel admitted that he entered the plea of not guilty by reason of mental disease or defect without discussing it with his client and he withdrew that plea without any discussion with Rita of the legal consequences or the effect of the withdrawal.
There was also evidence that surfaced at this hearing that the trial attorney had some knowledge that Robert Felton had molested the daughters. Whether the trial attorney was fully aware of these molestations is unclear from his testimony, but Rita Felton said she had informed him of the molestations shortly before trial. One of the molestations allegedly occurred on the day of the shooting.
Dr. Kenworthy at the postconviction hearing stated that she did have expert knowledge of the problems of *497 battered women, but she did not have a knowledge of the problems involved in the criminal law. She said that, when she testified, she did not have an understanding of the heat-of-passion defense or of nonresponsibility by reason of mental disease or defect.
She testified that now that she knows these standards she would be able to testify that the battering was the provocation which caused Rita to be deaf to the voice of reason and to act from that impelling force rather than from wickedness, cruelty, or recklessness. The implication of her testimony was that she would have been able to so testify at trial if the attorney had properly prepared her as a witness. Significantly, she also testified that any other person in that battering relationship would experience the same emotions and have the reaction that Rita did.
She also testified that, now that she understands the plea of not guilty by reason of mental disease or defect, she could testify that Rita had a severe personality disorder and did not have the substantial capacity to appreciate the wrongfulness of her acts and was unable to conform her conduct to the requirements of the law.
Dr. Fosdal, the state's psychiatrist, in an affidavit stated that, had Felton's trial attorney asked him he would have recommended a plea of not guilty by reason of insanity, because the determination of mental nonresponsibility is for the jury. He also stated that the jury "might" have accepted the heat-of-passion defense. He did acknowledge telling the lawyer that Rita Felton, in his opinion, did not have a particular mental disease or defect at the time of the offense.
Following the evidentiary hearing, the trial judge denied the motion for a new trial. He made no formal findings of fact and entered no conclusions of law, but at the close of the hearing, he addressed himself to the *498 principal matter raised the ineffectiveness of counsel. His oral holding from the bench failed to refer to any of the facts adduced during the post-trial hearing in respect to ineffectiveness of counsel. Rather, he stated, referring to the lead attorney and to the attorney who furnished assistance at trial:
"[I]t is the Court's recollection that while they may not have presented a perfect defense, the Court is aware or was made aware of the fact that both of these attorneys had previous experience and that they handled themselves well in the Courtroom and they adequately represented the defendant and participated in her defense in an adequate manner. . . . [T]here may have been some shortcomings in the matters handled during the trial, but very often that is a matter of trial strategy, and in this case the defense relied on the battered wife syndrome defense, and results of the jury verdict indicate that they were successful and presented a defense by which the State . . . did not receive [a first degree murder conviction] . . . . [T]he Court finds that the defendant was adequately represented by her attorneys during the course of the trial, and that the defenses they put forth were a matter of choice and of trial strategy, and not grounds for a new trial."
The court also listed the seven other grounds which had been urged in the motion for a new trial. The court denied relief on these grounds. It merely restated its original rulings without any discussion whatsoever of either the evidence at trial or that produced at the hearing.
The motion for a new trial was coupled with a motion for reduction of sentence; and in respect to that motion, the judge gave a detailed statement of the facts adduced at the hearing and concluded that the original sentence was too severe. The judge found that Rita Felton was making rehabilitative progress and, accordingly, reduced the original sentence from sixteen years to ten years.
The basic question on this review, as on the appeal, is the one to which the trial court initially addressed its *499 attention on the motion for new trial whether counsel for Rita Felton had been ineffective.
The United States Constitution and the Constitution of the State of Wisconsin guarantee the right to counsel. The right to counsel is more than the right to nominal representation. Representation must be effective. Cuyler v. Sullivan, 446 U.S. 335 (1980); State v. Koller, 87 Wis. 2d 253, 274 N.W.2d 651 (1979); State v. Harper, 57 Wis. 2d 543, 205 N.W.2d 1 (1973).
Whether or not an attorney is experienced is not the criterion for determining whether counsel was effective in a particular case, and the fact that an attorney is ineffective in a particular case is not a judgment on the general competency of that lawyer. It is merely a determination that a particular defendant was not appropriately protected in a particular case. As Judge Bazelon has written:
"Ineffectiveness is neither a judgment of the motives or abilities of lawyers nor an inquiry into culpability. The concern is simply whether the adversary system has functioned properly: the question is not whether the defendant received the assistance of effective counsel but whether he received the effective assistance of counsel. In applying this standard, judges should recognize that all lawyers will be ineffective some of the time; the task is too difficult and the human animal too fallible to expect otherwise." Bazelon, The Realities of Gideon and Argersinger, 64 Georgetown Law J. 811, 822-23 (1976).
Accordingly, the trial judge's conclusion that the lead lawyer at the trial and upon whom we are obliged to focus our attention, "had previous experience," is irrelevant in respect to whether Rita Felton had effective assistance of counsel in this case. It is a fact, however, that the attorney was new to the practice of law in Wisconsin, had little criminal experience, and had never before tried a felony case. This, however, does not establish ineffective assistance of counsel. As the United *500 States Court of Appeals for this circuit said in U.S. ex rel. Williams v. Twomey, 510 F.2d 634, 639 (7th Cir. 1975):
"[E]very lawyer must begin his career without experience. His first case is not inevitably so ill-prepared or poorly presented as to justify a finding of his incompetence."
Thus, even inexperienced counsel may provide representation which is equal to that that would be given by an ordinarily prudent lawyer skilled and versed in the criminal law and, conversely, on occasions even experienced counsel may be ineffective. Accordingly, we judge not the attorney's general competency, but rather we focus upon whether the representation given in this case to Rita Felton was effective. Nevertheless, from an examination of the record, we are fully aware of the relative inexperience of the trial attorney and the fact that he felt he was obliged by his employment as a public defender to assume representation in this case although he had serious doubts of his ability to provide optimum representation.
The case was a complex and lengthy one, raising numerous issues, only a few of which we consider in this opinion. This case would have provided a substantial challenge to even the most experienced lawyer. Many of the challenges posed by the case were handled well by counsel. Nevertheless, we are obliged to judge effectiveness of counsel, not on the basis of whether a lawyer did his best in light of his experience, but rather on the basis of the standards for "effective" counsel that have been established by this court. This court adopted the modern standard for judging effective assistance of counsel in State v. Harper, supra, wherein we said:
"Effective representation is not to be equated, as some accused believe, with a not-guilty verdict. But the representation must be equal to that which the ordinarily *501 prudent lawyer, skilled and versed in criminal law, would give to clients who had privately retained his services." P. 557.
In Harper we specifically rejected the test previously accepted in this state and in numerous other jurisdictions that a new trial would not be granted upon the grounds of ineffective counsel unless counsel's performance was "so inadequate and of such low competency as to amount to no representation" or "so inadequate as to amount to no counsel at all and to reduce the trial to a sham and a mockery of justice." Harper emphasized the duty of a lawyer to investigate adequately the circumstances of the case and to explore all avenues which could lead to facts that are relevant to either guilt or innocence, and it specifically adopted sec. 4.1 of the American Bar Association Standards Relating to The Prosecution Function and The Defense Function.[1]Harper pointed out that courtroom performance and demeanor were not the sole criteria whether a proper antecedent investigation had been made. It emphasized that, in determining whether or not counsel had been effective, it is not appropriate by hindsight to insist on what would have been an ideal defense but rather that a defendant is entitled to a defense which, under all the facts, would have afforded reasonably effective representation.
Since Harper we have reiterated that trial counsel and the defendant may, on the basis of a considered judgment, select a particular defense from among the alternative *502 defenses that are available. Weatherall v. State, 73 Wis. 2d 22, 242 N.W.2d 220 (1976), cert den 429 U.S. 923 (1976); Lee v. State, 65 Wis. 2d 648, 223 N.W.2d 455 (1974). The defense selected need not be the one that by hindsight looks best to us.
This court has often stated that it disapproves of postconviction counsel second-guessing the trial counsel's considered selection of trial tactics or the exercise of a professional judgment in the face of alternatives that have been weighed by trial counsel. Weatherall, supra, p. 30; Kain v. State, 48 Wis. 2d 212, 222, 179 N.W.2d 777 (1970).
Nevertheless, it is apparent that the prudent-lawyer standard adopted in Harper implies that there be conduct that is more than just acting upon a whim. It implies deliberateness, caution, and circumspection. It is substantially the equivalent of the exercise of discretion; and, accordingly, it must be based upon a knowledge of all facts and all the law that may be available. The decision must evince reasonableness under the circumstances.
Consistent with the express language of Harper, a prudent lawyer must be "skilled and versed" in the criminal law. The prudent-lawyer standard requires that strategic or tactical decisions must be based upon rationality founded on the facts and the law. If tactical or strategic decisions are made on such a basis, this court will not find that those decisions constitute ineffective assistance of counsel, even though by hindsight we are able to conclude that an inappropriate decision was made or that a more appropriate decision could have been made. Thus, when we look to a lawyer's conduct and measure it against this court's standard to determine effectiveness, we cannot ratify a lawyer's decision merely by labeling it, as did the trial court, "a matter of choice and of trial strategy." We must consider the law and the facts as they existed when trial counsel's conduct *503 occurred. Trial counsel's decisions must be based upon facts and law upon which an ordinarily prudent lawyer would have then relied. We will in fact second-guess a lawyer if the initial guess is one that demonstrates an irrational trial tactic or if it is the exercise of professional authority based upon caprice rather than upon judgment.
[1]
An essential ingredient which must go into the determination of whether assistance of counsel is ineffective is prejudice to the defendant. As stated in the concurring opinion in State v. Fencl, 109 Wis. 2d 224, 241, 325 N.W. 2d 703 (1982):
"If the failure could have had no adverse effect on the defendant, the representation would not have been any more effective had that failure not occurred."
See also, Weatherall, supra, p. 32.
The omission or commission sufficient to make a failure of counsel prejudicial has not been defined with clarity or consistency by this court, or for that matter by courts in other jurisdictions. Nor do we have occasion in this opinion to explore in detail the boundaries of what failures of counsel are prejudicial. It is appropriate to continue as we have heretofore, that is, to make such determinations of prejudice on a case-by-case basis. See, Fencl, supra, Abrahamson, J. concurrence p. 256.
The question in this case is whether there was ineffective counsel where the lawyer failed to inform himself of a defense provided for in the statutes, and where he failed to adequately investigate the facts in respect to a potential defense, when the record indicates that, had these failures not occurred, a judge, after a proper evaluation of the record, could be impelled to instruct the jury in respect to these defenses and a jury could return a verdict based on one of these defenses.
*504 [2]
In the instant case the principal grounds for a claim of ineffective counsel are the admitted ignorance of trial counsel of the statutes authorizing the heat-of-passion manslaughter defense and the failure to give due consideration to the defense of not guilty by reason of mental disease or defect and to make any meaningful investigation of the facts in respect to that defense. The record clearly indicates that Rita Felton was deprived by the conduct of her counsel in this particular case of the benefit of these two crucial defenses. She was prejudiced in her defense, and counsel was ineffective. We accordingly reverse and remand for a new trial.
[3]
The court of appeals raised the question of the proper standard of review in this case where the issue is the ineffectiveness of counsel. The first step in the analysis of a claim of ineffective assistance of counsel is to determine what the attorney did or did not do and the basis for the challenged conduct. State v. Fencl, 109 Wis. 2d 224, 247, 325 N.W.2d 703 (1982) (Abrahamson, J., concurring). These are factual determinations. A trial court's findings of fact will ordinarily be upheld unless they are against the great weight and clear preponderance of the evidence. Wurtz v. Fleischman, 97 Wis. 2d 100, 107, 293 N.W.2d 155 (1980). This is the type of finding to which this court referred in applying the great weight and clear preponderance of the evidence standard in State v. Rock, 92 Wis. 2d 554, 556, 285 N.W. 2d 739 (1979).
In this case, the trial court did not make any findings of fact. However, the facts and the inferences to be drawn therefrom are undisputed. This court is not bound by a determination of the trial court which is based on undisputed facts, for, under those circumstances, only a question of law is presented. Compton v. *505 Shopko Stores, Inc., 93 Wis. 2d 613, 616, 287 N.W.2d 720 (1980). The ultimate conclusion of whether the attorney's conduct resulted in a violation of the right to effective assistance of counsel is a question of law. Only a question of law is presented in this case, so deference to the trial court's determinations is not appropriate.
One of the major aspects of the claim of ineffective counsel was the failure of the attorney to inform himself on the possible defense of heat-of-passion manslaughter. At the postconviction hearing, the trial attorney admitted that he was unaware of sec. 940.05(1), Stats., which provides:
"Whoever causes the death of another human being under any of the following circumstances is guilty of a Class C felony:
"(1) Without intent to kill and while in the heat of passion . . . ."
The trial counsel focused entirely upon self-defense as it applied to a battered spouse, as Rita Felton clearly had been over the course of the years. Because of his preoccupation with this defense, counsel failed to explore the statutes further, and he never discovered the heat-of-passion provision. Accordingly, he never was in a position even to consider whether, in light of the facts, heat of passion was an appropriate defense; and he never explored the circumstances to determine what evidence existed that would support a finding that Rita Felton acted in the heat of passion. That defense was unknown to him, and he asked for no instructions on heat-of-passion manslaughter.
The standards adopted in Harper, supra, mandate that, to be effective, counsel must act in a manner that demonstrates that he is versed in the criminal law. The failure to be informed of this defense in the circumstances of this case constitutes a glaring deficiency in trial counsel's knowledge of the law. Without that knowledge, *506 it was impossible for him to weigh alternatives and to make a reasoned decision consistent with the standard of performance expected of a prudent lawyer.
In Harper, we adopted the defense function standard 4.1 mandating the duty of a trial lawyer to fully investigate the facts of the case. The failure of counsel here to inform himself of the statutory defense of heat-of-passion manslaughter violates A.B.A. Defense Function Standard 5.1(a). That section provides:
"5.1 Advising the defendant.
"(a) After informing himself fully on the facts and the law, the lawyer should advise the accused with complete candor concerning all aspects of the case, including his candid estimate of the probable outcome."
This standard is explained in Commentary a:
"Advice on the plea.
"The duty of the lawyer to investigate fully the facts of the case, regardless of the anticipated plea, is discussed in section 4.1, supra. The lawyer's duty to inform himself on the law is equally and often more important; although the client may sometimes be capable of assisting in the fact investigation, he is not educated in or familiar with controlling law. The responsibility to know the law which the lawyer bears is a heavy one, given the rapid pace of change in many areas of criminal law and procedure." (Emphasis supplied.)
[4]
Although merely holding oneself out to be a "lawyer" by implication imposes the requirement that a "lawyer" be fully informed on the law pertinent to a case, we expressly adopt sec. 5.1(a), supra, and the portion of the commentary which we have quoted. Certainly, a prudent lawyer, skilled in the criminal law, would be certain to be informed of the elements of heat-of-passion manslaughter prior to undertaking a first-degree murder trial, especially when, as in this case, there was evidence of provocation.
*507 The court of appeals correctly concluded that the failure to consider the heat-of-passion manslaughter defense cannot be said to be a matter of trial strategy. As we pointed out above, "strategy" or "tactics" carry with them the connotation of familiarity with available choices as a prerequisite for a rational determination of a course of action based on pertinent law and facts. While this court is loath to interfere with a lawyer's exercise of professional judgment by a hindsight evaluation, we are satisfied that requiring lawyers to inform themselves of the relevant law prior to formulating a defense or determining a strategy or tactic will promote the exercise of rational, informed, and considered judgment.
There are, of course, a multitude of cases in which a lawyer's failure to inform himself of a particular defense could in no way be prejudicial, because that defense would not be pertinent to the facts. In the context of the failure to inform himself of the law, which prevents the exercise of professional judgment, and which prevents the opportunity to make a rational choice of trial strategy, prejudice does exist if the facts presented at trial or in the postconviction hearing would justify the submission of a defense or of a lesser-included offense to the jury. The facts revealed in this case must be such that the lawyer would, had he known the law, been able to introduce sufficient evidence to raise the heat-of-passion issue. State v. Lee, 108 Wis. 2d 1, 11, 321 N.W.2d 108 (1982).
[5]
The burden upon the defendant where a heat-of-passion defense is projected is merely the burden of production as opposed to the burden of persuasion. It is for the accused to come forward with some evidence in rebuttal of the state's case evidence sufficient to raise the issue of the provocation defense. The burden of persuasion, of course, always remains upon the state. *508 The provocation issue is sometimes implicitly, or explicitly, sufficiently raised by the prosecution. Hence, if it appears from the evidence, either that produced by the state or by the defense, that a jury, under a reasonable view of the evidence, could conclude that the state has not sustained its burden of disproving provocation beyond a reasonable doubt, the heat-of-passion manslaughter instruction must be given to the jury. See, State v. Lee, supra, at 11. We have pointed out that the heat-of-passion manslaughter defense is dual-faceted. We said in State v. Lee, supra, at 12:
"To be legally adequate, the heat of passion resulting from . . . provocation must satisfy both an objective and a subjective test. In State v. Williford, supra, 103 Wis. 2d at 113, we wrote: `The heat of passion element of this offense must be the result of adequate provocation and the defendant's state of mind at the time of the commission of the homicide; thus, heat of passion has both an objective (provocation) and a subjective (state of mind) facet.' In other words, the provocation must be such that would cause an ordinary, reasonable person to be overcome with emotion to the degree discussed in the Johnson line of cases. Furthermore, this provocation must have actually caused such a reaction in the particular defendant."
Although the court of appeals correctly concluded that the failure to raise the heat-of-passion manslaughter defense could not be overlooked as being trial strategy, it concluded, erroneously, that the failure in this respect was not prejudicial because neither the objective nor subjective tests set forth above could be satisfied. Because the facts would, had the law been known to counsel, have been sufficient to warrant an instruction on heat-of-passion manslaughter, the omission of counsel was prejudicial. The facts properly presented were such as would satisfy the accused's burden of creating an issue in respect to the defense of heat of passion.
*509 In State v. Williford, 103 Wis. 2d 98, 113, 307 N.W.2d 277 (1981), we said the provocation that would reduce murder to manslaughter must be sufficient to:
"`. . . so overcome and dominate or suspend the exercise of the judgment of an ordinary man as to render his mind for the time being deaf to the voice of reason: make him incapable of forming and executing that distinct intent to take human life essential to murder in the first degree, and to cause him, uncontrollably, to act from the impelling force of the disturbing cause, rather than from any real wickedness of heart or cruelty or recklessness of disposition. . . .'"
[6]
The court of appeals erred when it held that the objective test could not be met by the evidence produced at trial or the evidence which the postconviction hearing demonstrated could have been produced. It reasoned that, although Robert Felton's actions were violent and despicable, the ordinary person would not have responded to them in the way Rita Felton did. The court of appeals appeared to think that it would have been erroneous to consider how others of a similar background as Rita's would have reacted, but only to consider whether a person ordinarily constituted would have acted in the heat of passion in response to the immediate provocation. It declined to consider how an ordinarily constituted person who was a battered spouse would have reacted to the provocation. In this we consider the court of appeals erred. While it is true that a defendant's background is not in general relevant to the objective test for heat of passion, the question is how an ordinary person faced with a similar provocation would react. The provocation can consist, as it did here, of a long history of abuse. It is proper in applying the objective test, therefore, to consider how other persons similarly situated with respect *510 to that type, or that history, of provocation would react.
This question is not one of first impression in this court. Twenty years ago this court found it appropriate to instruct on heat-of-passion manslaughter in the case of battered spouses. In State v. Hoyt, 21 Wis. 2d 284, 128 N.W.2d 645 (1964) (rehearing), the defendant wife had been beaten, choked, and humiliated by the husband during the marriage. This court said:
"If we look solely at the action of Mr. Hoyt in the last few minutes before the shooting, it seems clear that such actions would not be sufficient to produce the required degree of disturbance in an ordinarily constituted person not previously subjected to the treatment visited upon Mrs. Hoyt by her husband and disclosed by the record. On the other hand, it seems reasonable that the treatment to which Mrs. Hoyt had been subjected for a long period of time, and the public humiliation of her within the previous hour would have a cumulative effect upon any ordinary person so that the provocation just before the shooting would be greatly magnified." 21 Wis. 2d at 291.
Thus, this court has held that the objective test may be satisfied by considering the situation of an ordinary person who is a battered spouse. Williford, at page 122, summarized the situation in Hoyt, stating the defendant:
". . . over a long period of time, had attempted to sublimate or repress her pent up frustrations with her husband's frequent insults and abuse and became something of a human time bomb . . . ."
[7]
The history of the relationship which has been recited earlier in the opinion provides evidence of provocation sufficient to support a conclusion that the objective portion of the test was sufficiently raised. Had the heat-of-passion manslaughter defense been asserted, a trial judge could reasonably give that instruction and a jury *511 could return a verdict based on facts satisfying the objective portion of the test for heat-of-passion manslaughter.
It should also be noted that, at the postconviction hearing, some evidence was introduced that Robert Felton had sexually abused two of his daughters, one of them just shortly before the shooting. The judge limited testimony on this issue, but it appears that, had Rita Felton's attorney been aware of the heat-of-passion manslaughter defense and had that defense been submitted to the judge, his ruling might have been markedly different.
It seems clear that the history of abuse, plus the provocation which occurred on the day of the shooting, was clearly sufficient under the rationale of Hoyt to raise a jury issue as to the objective facet of heat of passion. Moreover, Dr. Kenworthy, the psychologist, testified at the postconviction evidentiary hearing that Rita Felton reacted in a manner that she would expect any ordinary person eventually to react as a result of a course of abuse.
While the court of appeals, in concluding that the standards for heat-of-passion manslaughter could not be met in this case, attempted to analogize this case to Williford, we do not think the cases similar. In Williford, the physical and verbal abuse was mutual, and none of the provocative events occurred within two weeks prior to the shooting. We held that, under those facts, there was a lengthy cooling off period, and hence the objective test was not satisfied. Here, at the most, the last assault or provocation occurred within two or three hours. We cannot conclude, as did the court of appeals, that, under these circumstances, as a matter of law, the heat of passion in a reasonable or ordinary person would have dissipated in less than three hours. The objective facet of the heat-of-passion test was satisfied.
A jury could also have found that the subjective test was satisfied. The court of appeals reasoned that the *512 evidence showed that Rita Felton sat down and debated with herself whether to kill her husband, that she considered the consequences of her action, and that she finally determined that her action was necessary in order to save her own life and to improve the lives of her children. Under some circumstances, certainly this evidence would tend to show a deliberateness consistent with malice of forethought or the specific intent to kill another person, which is essential to murder in the first degree and which would negate a subjective provocation. However, there was evidence in this case that Rita Felton, just before the shooting, was overcome with extreme anger and terror. She testified that she was shaking and in a daze. As the testimony of Dr. Kenworthy pointed out, a person in the situation of Rita Felton could not in fact explain her motives and intentions, and that Rita was in a daze and was acting uncontrollably from the force of the disturbing provocation.
Although Rita Felton testified that she intended to shoot her husband, she testified that she had to shoot him. She was unable to recount much of what happened shortly before and after the time of the shooting. We said in Lee, supra, p 11:
"The heat of passion upon adequate provocation does negate the `distinct intent to take human life essential to murder in the first degree.'"
[8]
But we pointed out that intent or the volitional determination to take the life of another does not in itself abrogate heat-of-passion manslaughter. We stated in Lee, p. 9:
"The purpose of sec. 940.05(1), Stats., is clearly to punish homicides less severely if they result from the heat of passion. . . . This very intent is typically the result of the heat of passion. . . . This intent results from `the impelling force of the disturbing cause rather than from *513 any real wickedness of heart or cruelty or recklessness of disposition.'"
It seems clear, therefore, that there was evidence to show that, in respect to Rita Felton, the provocation could have been found sufficient to have caused a mental disturbance that overcame, dominated, or suspended her ability to exercise judgment, and rendered her mind temporarily deaf to the voice of reason and which caused her to act uncontrollably rather than from wickedness of heart. Because the evidence shows that trial counsel failed to inform himself about the law of heat of passion and because the evidence adduced, or which could have been adduced, clearly raised the jury issue as to whether the defendant was guilty of sec. 940.05(1), Stats., rather than first or second degree murder, the defendant was denied effective assistance of counsel. Clearly, the inability of Rita Felton to assert that defense was prejudicial.
We also note that the special materials volume of Wis. JI Criminal SM 6, points to the problems that confront a trial judge in a situation such as the one that arose during the trial of this case. Although a trial judge wishes to avoid impinging upon defense decisions, nevertheless there are circumstances where a court may sua sponte offer instructions. We said in Price v. State, 37 Wis. 2d 117, 130, 154 N.W.2d 222 (1967):
"[T]he battle might be so unequal due to the disparity of the skill of counsel that justice would require, in the unusual case, that such instructions be offered for counsel's consideration."
It is interesting to note from the record that, at the very beginning of the trial, the judge asked the lead attorney whether he would introduce expert testimony on the defendant's capacity to form a specific intent. The lawyer responded that he would. The judge then asked, *514 "Now, you are sure it's intent, not some other area such as provocation?" (Emphasis supplied.) Counsel's response was that it was only on intent and self-defense. Had either trial counsel or the judge followed up on the "provocation" question when it became apparent that provocation was an issue in the case which might implicate the heat-of-passion manslaughter defense, a new trial might have been avoided.
The other issue posed on the motion for new trial to demonstrate ineffective counsel involved the failure of trial counsel to consider asserting the defense of not guilty by reason of mental disease or defect. Trial counsel entered that plea and then withdrew it without consultation with his client. The A.B.A. Defense Function Standard 5.2(a) provides:
"5.2 Control and direction of the case.
"(a) Certain decisions relating to the conduct of the case are ultimately for the accused and others are ultimately for defense counsel. The decisions which are to be made by the accused after full consultation with counsel are: (i) what plea to enter; (ii) whether to waive jury trial; (iii) whether to testify in his own behalf."
This course of conduct was in itself violative of the standard expected of a prudent lawyer. It deprived the accused of the opportunity of decision-making where the decision is uniquely one that should be the client's, not the lawyer's.
In the instant case, there is no intimation that, at the time of trial or at the time of consultations with the lawyer, Rita Felton was incompetent or unable to make a rational decision. She was fully able to discuss the case with her attorney. The withdrawal of the plea was undertaken in open court, and she gave her acquiescence to that withdrawal. However, the record proves that there was no consultation with her whatsoever on the meaning or *515 consequences of the original plea or of its subsequent withdrawal. There is some indication in the record that the original entry of the plea was not taken seriously by counsel and that it was made only for delay. It would appear, however, that in the setting of this case, mental disease or defect could have been an important defense and could have posed a choice to counsel and to the defendant which should have been considered seriously by both of them.
As stated above, we have heretofore adopted in Harper sec. 4.1 of the Standards for the Defense Function in respect to the duty of the lawyer to conduct an investigation of the case and to explore all avenues leading to the facts relevant to guilt. We explicated this duty to investigate in Roe v. State, 95 Wis. 2d 226, 239, 290 N.W.2d 291 (1980):
"The duty to investigate extends to the exploration of whether the defendant possessed the requisite intent or capacity to commit the offense charged when it is not disputed that the defendant performed the act in question."
As the court of appeals pointed out, counsel's investigation was perfunctory at best. Prior to trial, trial counsel asked Dr. Fosdal, the state's psychiatrist, whether he thought the defendant had any mental disease or defect at the time of the offense. Fosdal told him that the defendant was not at that time suffering from any particular mental disease or defect. However, in an affidavit submitted by Dr. Fosdal at the postconviction hearing, the state's psychiatrist said that, had he been asked, he would have testified that, at the time of the offense, Rita Felton evinced a physical and mental disturbance, which was manifested by her despair, frustration, resentment, and fear, which impaired her judgment and which a jury could have considered to be a mental disease or defect. He stated that he would have recommended a plea of not *516 guilty by reason of insanity, because the determination of nonresponsibility was for a jury and that a jury under the facts could have come to the conclusion that Rita Felton was not responsible for her conduct.
Also, Dr. Kenworthy stated that there had been no consultation with her by counsel with respect to the possibility of the defense of mental disease or defect. She acknowledged that she was not a forensic psychologist, and without that prior consultation and instruction by counsel, she would not have given an opinion with respect to criminal responsibility. She stated at the post-trial hearing, however, that with her understanding then of the meaning of mental disease or defect, she could state, on the basis of the evidence in the case, that in her opinion the defendant suffered from a severe personality disorder that constituted a mental disease or defect and that Rita Felton, accordingly, did not have the substantial capacity to appreciate the wrongfulness of her acts or that she was unable to conform her conduct to the requirements of law.
[9]
It is apparent that the court of appeals correctly concluded that, because counsel's investigation was inadequate and violative of a prudent lawyer's duty to investigate, the determination to abandon the defense of not guilty by reason of mental disease or defect was not a considered judgment based on the facts and, therefore, its abandonment could not be considered a matter of trial strategy. It was not a reasoned and considered choice. By abandoning this defense without proper investigation, Rita Felton was deprived of a defense which under the facts could have been submitted to the jury. She was prejudiced by the deprivation, and counsel was therefore not effective.
We affirm the court of appeals' holding in this respect, and accordingly the defendant is entitled to a new trial *517 at which she may, if she wishes, assert the defense of not guilty by reason of mental disease or defect. We point out, however, that, having determined that counsel was ineffective for failure to assert the heat-of-passion manslaughter defense, the defendant is entitled to a new trial on all issues. In this respect, the decision of this court differs from that of the court of appeals, which declined to order a new trial on the issue of her guilt.
The defendant also contends that the trial judge unduly limited the testimony of other witnesses in respect to the violent acts committed by Robert. We agree with the court of appeals' conclusion that, if this was error, it was harmless, because the reputation testimony which was admitted and the testimony of the children supported Rita Felton's testimony about Robert's persistent abuse and repeated acts of violence. Hence, additional testimony on that issue was not crucial to Rita Felton's defense.
A statement was taken from Rita Felton following her arrest and in violation of the strictures of Miranda. The essential part of her statement was that she had been contemplating killing her husband for "a long time." This was elicited by interrogation following the Miranda warning and after she indicated that she did not wish to answer. The question was improper under the circumstances; and, as the court of appeals determined, the response should have been suppressed. The statement is not to be admitted at retrial. In the context of our present decision, which reverses the entire verdict on other grounds, the statement is, of course, irrelevant.
There was also an objection based upon what the parties refer to as a "bridging" instruction. The jury was instructed to try to agree that the defendant was not guilty of first or second degree murder before considering manslaughter self-defense. Wis. JI Crim. 1120. Ordinarily, a lesser-included offense does not require *518 proof of any fact in addition to those which must be proved for the crime charged. See, sec. 939.66(1), Stats. However, the situation is different with lesser-included types of homicide. Wis. JI Crim. 1140 recites that the elements of first or second degree murder must exist as a prerequisite to finding a defendant guilty of violation of sec. 940.05(2), Stats., manslaughter imperfect self-defense. Thus, it is argued by counsel for defendant on this appeal that it is only after finding a defendant's conduct conforms with the elements of first or second degree murder may the jury go on to mitigating conduct in the nature of manslaughter. It is asserted that these instructions are likely to prevent a jury from ever considering manslaughter and are likely to have the effect of coercing the jury to return a verdict of first or second degree murder when the appropriate conviction would be on a lesser degree of homicide.
Because of our disposition of other issues in this case, the propriety of the bridging instruction is not necessary to the disposition of this review, and we do not address that issue as a determinant of this case. Furthermore, we note that revised jury instructions on murder and heat-of-passion manslaughter were adopted by the Criminal Jury Instructions Committee on October 15, 1982, and have as of the date of the writing of this opinion been distributed to the bar and bench. The new instructions are directed to the very problem to which defendant's counsel points in the present review. Revised Jury Instruction 1130, after reciting the elements of first degree murder, carries with it the admonition:
"In this case, first degree murder also requires that the defendant was not acting in the heat of passion caused by reasonable and adequate provocation."
The instruction for second degree murder also carries that same admonition that there cannot be a conviction for second degree murder if the defendant was acting in *519 the heat of passion caused by reasonable and adequate provocation.
While a problem may remain in respect to possible jury coercion, it appears that the revised jury instructions eliminate the particular coercive effect allegedly caused by the instructions used in the instant case. Hereafter, a jury will be instructed to reject first or second degree murder if the elements of heat-of-passion manslaughter are present. We do not address ourselves to whether the instructions used in the present case were coercive or tended to impel the jury to overlook the mitigating defenses; nor are we in a position to give our advisory approval to the proposed instructions. We merely note that different instructions will be available and may be used on the retrial of this case.
Because we find counsel's conduct did not rise to the standard expected of a prudent lawyer reasonably skilled and versed in the criminal law and that the conduct of counsel prejudiced the defendant by depriving her of important defenses, we hold that counsel in this case was ineffective.
We reverse that portion of the court of appeals' decision which affirmed the trial court's judgment finding Rita Felton guilty, and affirm that portion of the court of appeals' decision ordering a new trial on the question of criminal responsibility.
By the Court. Decision reversed in part and affirmed in part; cause remanded to the trial court for a new trial on all issues.
BEILFUSS, C.J., took no part.
STEINMETZ, J. (concurring).
I agree with the result and reasoning of the majority opinion.
The attorney appointed in this case to represent the defendant was a recently hired attorney on the staff of the public defender. The attorney, in fairness to him, *520 told his superiors that he was not well versed in the criminal law. He had practiced law for over three years; however, he had never handled an entire felony case. This case became his responsibility on the first day he actually assumed the duties as a public defender. He acknowledged that he was probably incompetent to handle a case of this magnitude. He stated that he attempted to get experienced, private counsel appointed, but his superiors encouraged him to undertake the defense. The administrators of the public defender's program provided him with the assistance of a more experienced attorney; but he had only limited opportunity to consult with that attorney until just before the time of the trial. This assignment was in a potential first degree or second degree murder case with possible defenses of self-defense or manslaughter applying the fairly newly recognized theory of a battered spouse or mental disease or defect.
Before the creation of the state public defender's program, assignments of defense attorneys were made by the trial judge assigned to conduct the trial. There may have been some deficiencies in the old system, including allegations of patronage; however, the assignments, in at least the serious felony cases, were of experienced and capable private attorneys. The representation given to felony defendants was consistently high. Since the responsibility for these assignments rests with the public defender's office, persons in that agency responsible for defense attorney assignments must exercise their duties with the same care that was the custom and practice of the trial judges.
The public defender's office has established its own rules regarding the appointment of staff attorneys or private attorneys for serious felonies. The relevant portions of those rules, sec. SPD 1.04, Wis. Adm. Code, in effect since September 1, 1981, are:
*521 "(3) An attorney shall be certified for felony cases involving a felony offense bearing a maximum penalty of 20 or more years imprisonment if:
"(a) The attorney has requested certification;
"(b) The attorney is admitted to the state bar of Wisconsin;
"(c) The attorney has completed the continuing legal education requirements as provided in sub. (7); and
"(d) Either:
"1. Has served 2 years as a prosecutor;
"2. Has served 2 years as a public defender; or
"3. Has been trial counsel alone or with other trial counsel and handled a significant portion of the trial in 5 cases, civil or criminal, that has been tried to a jury to final resolution.
". . .
"(5) Attorneys employed by the state public defender shall meet the same criteria as certified private attorneys.
". . .
"(7) CONTINUING LEGAL EDUCATION. Any attorney certified under these rules shall complete seven hours of continuing legal education each calendar year in courses approved by the executive board of the criminal law section of the state bar of Wisconsin."
If the public defender's office had in effect its present rules at the time of this assignment, the deficiencies in this representation would not have occurred. If a truly qualified staff attorney had not been available for assignment to this difficult and serious case, then the defendant deserved a truly qualified, experienced private attorney to be appointed to represent her. If that had been done here, regardless of the existing rules of qualification, the interests of justice would have been better served. Moreover, from an economic standpoint, the state would have been better off with one well-prepared and presented defense than with two trials.
I am authorized to state that JUSTICES WILLIAM G. CALLOW and LOUIS J. CECI join in this concurring opinion.
NOTES
[1] "4.1 Duty to investigate.
"It is the duty of the lawyer to conduct a prompt investigation of the circumstances of the case and explore all avenues leading to facts relevant to guilt and degree of guilt or penalty. The investigation should always include efforts to secure information in the possession of the prosecution and law enforcement authorities. The duty to investigate exists regardless of the accused's admissions or statements to the lawyer of facts constituting guilt or his stated desire to plead guilty." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582054/ | 469 F. Supp. 563 (1979)
Walter MOSELY, Rev. C. O. Hall, William Land and Willie Lewis, Jr.
v.
Bernis W. SADLER, Maurice Conerly, Arthur J. Guidry, Joe L. James, Malcolm L. Clerk, C. Fred Huber and Ray Bernard.
Civ. A. No. B-78-69-CA.
United States District Court, E. D. Texas, Beaumont Division.
April 11, 1979.
*564 Donald J. Floyd, Kermit C. Morrison, Jr., Port Arthur, Tex., for plaintiffs.
Robert Q. Keith, Mehaffy, Weber, Keith & Gonsoulin, Beaumont, Tex., George B. Wikoff, Port Arthur, Tex., for defendants.
Robert P. Walker, Port Arthur, Tex., for intervenors.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
STEGER, District Judge.
FINDINGS OF FACT
In accordance with the mandate of Nevett v. Sides, 571 F.2d 209, 217 (5th Cir. 1978) and the cases decided therewith and cited therein, the Court, having heard and considered the evidence, makes the following "particularized determinations" relevant to an ultimate decision in this case.
GENERAL FACTS
I. HISTORICAL:
1. The City of Port Arthur was founded in 1898.
*565 2. It is located in Southeast Jefferson County, Texas.
3. Port Arthur is bounded by Lake Sabine, the Sabine-Neches waterway, and is near to the Gulf of Mexico and the salt-grass marshland adjacent to the Gulf of Mexico.
4. Port Arthur encompasses an area of 50.38 square miles of land area and 32.57 miles of water area.
5. Port Arthur is largely an industrial city whose people predominantly work in oil refining, petro-chemical manufacturing, sea-faring, and related occupations.
6. Two of the nation's largest oil refining and petro-chemical manufacturing facilities are located at Port Arthur.
II. POPULATION FACTS:
7. The population of Port Arthur has been:
(a) 1940 _ _ _ _ _ _ _ _ _ _ _ _ _ 46,140
(b) 1950 _ _ _ _ _ _ _ _ _ _ _ _ _ 57,530
(c) 1960 _ _ _ _ _ _ _ _ _ _ _ _ _ 66,676
(d) 1970 _ _ _ _ _ _ _ _ _ _ _ _ _ 57,371
8. Port Arthur has a somewhat heterogeneous population predominantly consisting of Mexican-Americans, Negroes, Caucasians, and among this group, a large influence of Frenchspeaking "Cajuns" who have come largely from South Louisiana to work in the oil refining and petrochemical industries but who have a distinct cultural background and ethnic character.
9. The heterogeneous population of Port Arthur is very different from the population of East Texas cities to the north wherein the white populous is normally Anglo-Saxon Protestant.
10. The population of Port Arthur is different from the south Texas cities wherein there is a large dominance of Mexican-American citizens.
11. Because of the Louisiana "Cajun" influence, Port Arthur has a large Roman Catholic population.
12. Port Arthur has a large percentage of older (62 or older) persons and retired persons. The 1970 census reflects 8,032 older persons, or 14% of the total population, compared to a national average of approximately 10%.
13. The racial composition of Port Arthur, according to the 1970 census, is:
(a) Total population _ _ _ _ _ _ _ _ _ _ _ _ 57,371
(b) Total Black population _ _ _ _ _ _ _ _ _ 22,994 _ _ 40.00%
(c) Total Hispanic population _ _ _ _ _ _ _ _ 3,799 _ _ 6.62%
(d) Total voting-age
population _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 37,856 _ _ 66.00%
GOVERNMENTAL FACTS AND POLICIES
III. PREVIOUS GOVERNMENTAL FORMS
14. Texas allows its cities to operate under a "home-rule amendment" which provides:
"Cities of more than 5,000 inhabitants may by a majority vote of the qualified voters adopt their own Charter;
. . ." Texas Constitution, Article XI, § 5.
15. Port Arthur adopted the home-rule amendment on March 8, 1932.
16. From 1898 until 1955 Port Arthur elected its city governmental officials by at-large vote.
17. From 1955 until 1962 Port Arthur elected its city governmental officials from wards or single-member districts.
18. From 1963 until the present Port Arthur elects its mayor and city council members in at-large elections.
19. The city council members must reside within residential subdistricts and are voted at large.
IV. CHARTER CHANGE:
20. Between 1955 and 1962 Port Arthur elected its city council members in and from single-member districts. Only those persons residing within the ward or single-member district voted on the council member from such district.
21. Port Arthur, during the time 1955 till 1962, became infamous for its corruption in local government.
22. The citizens of Port Arthur formed a charter-change commission in 1962.
*566 23. The citizens of Port Arthur concluded that much of its local governmental corruption was attributable to the ward or single-member district form of election.
24. In January, 1963, the present city charter was adopted by vote of the people.
25. The results of that charter-change election were: For, 6,829; against, 1,022.
26. The charter-change election of January, 1963 was supported by Black and White citizens alike and the vote carried favorably to charter change in every single voting box, both Black and White. The change from the use of single-member districts to the use of a multi-member districting scheme was rooted in a strong state policy allowing certain municipalities to choose their form of governance and the adoption of the multi-member districting by the City of Port Arthur was reasonably related to the desire of the citizens of Port Arthur, both Black and White, to eliminate the much publicized corruption in city government under the single member plan.
V. PRESENT CITY CHARTER:
27. Port Arthur operates under a council-manager form of government.
28. The council-manager form of government has generally been considered in the United States as the most enlightened and efficient type of local government.
29. In Port Arthur, city council members must serve the interests of the entire city, and not merely those in the ward or district of their residence.
30. The council-manager form of government calls for a mayor and city council elected by the general population and a professional city manager to operate the city and carry out the policies of the city council.
31. The city council in Port Arthur consists of six (6) council persons and a mayor.
32. Each elected official serves a term of two (2) years.
33. Each person is elected in an at-large vote.
34. Each of the six city council members must reside in a geographical subdistrict but are voted on by the entire electorate.
35. There is no filing fee for city council office.
36. The Charter calls for property ownership as a condition of qualification to the office of mayor or city council.
37. The City Attorney of Port Arthur has declared the property ownership requirements for candidacy unconstitutional and unenforceable.
38. No person has been excluded from candidacy or disqualified for lack of property ownership under the present city charter.
39. There are no provisions for primary elections under the present city charter.
40. All persons elected as mayor and city council persons have been chosen in non-partisan elections.
41. Each person elected must receive a majority vote, and there is a run-off provision to accommodate this requirement.
42. There is no "anti-single-shot" provision in the city charter.
43. The Charter may be changed by election of a majority of persons voting.
44. A charter-change election must be called upon petition of 5% of the total number of persons voting at the last general election of the city.
45. 14,443 persons voted at the last general election of the city.
46. Neither plaintiffs nor anyone else has petitioned to amend the present City Charter, although a petition of only 721 persons is required to call an election to amend the Charter.
*567 ACCESSIBILITY
VI. BLACK POLITICAL HISTORY:
47. The experience of the Negro citizen chronicled in White v. Regester, 412 U.S. 755, 93 S. Ct. 2332, 37 L. Ed. 2d 314, has not been the experience in Port Arthur.
48. While Blacks in Texas were generally excluded from participation in the Democratic Party primaries prior to World War II (cf. Nixon v. Herndon, 273 U.S. 536, 47 S. Ct. 446, 71 L. Ed. 759 [1927]), Blacks have participated fully in political elections in Port Arthur.
49. Beginning at least as early as 1921, Blacks have participated without discrimination in all municipal elections within the City of Port Arthur.
50. In 1927 a separate voting box was created at the Grannis Avenue Fire Station, within a Black residential area.
51. While in most cities of Texas Blacks were not permitted to vote in municipal elections, there was heavy Black participation in Port Arthur at least as early as 1927, and maybe much earlier.
52. The Black citizens have participated substantially in municipal and civic affairs in Port Arthur from its inception.
53. In 1921, the first year women were enfranchised under the XIX Amendment to the United States Constitution, Black women voted in Port Arthur municipal elections.
54. No Black person has been denied the right to vote in Port Arthur municipal elections, at least since 1916, on account of race.
55. No literacy requirements or similar bar to participation by the Blacks has been imposed in any municipal election within Port Arthur.
56. Beginning in the 1920's, and continuing up at least until the late 1960's or early 1970's, when there were several candidates for office in an at-large election, the Black vote has been the "swing vote" in a number of city elections.
57. The Black vote, when it voted as a bloc, has allowed the Black citizens substantial voice in the political process because this vote has represented the "balance of power" between competing factions within the municipality.
58. In 1955, a Black person was elected to the city council of Port Arthur. At all times since 1955, there has been a Black person as a member of the city council of Port Arthur. Port Arthur was one of the very first cities in Texas to elect a Black person to its city council.
59. When the State Democratic Party would not recognize or seat them, Black persons were represented as delegates to the Jefferson County and State Democratic conventions from the City of Port Arthur.
VII. MEXICAN-AMERICANS IN PORT ARTHUR:
60. The Mexican-American represents approximately seven percent (7%) of the population of Port Arthur.
61. Historically, the Mexican-American residential community was somewhat concentrated in an area west of Houston Avenue and north of Sixteenth Street.
62. Since World War II the Mexican-American population has disseminated throughout the City of Port Arthur and is now dispersed throughout the City and has no particular concentration in any one locale.
63. Mexican-American citizens reside rather uniformly throughout the City and are in small but substantially equal numbers in the majority of voting precincts.
64. There are few, if any, Spanish-speaking persons in Port Arthur who do not also converse in the English language.
65. Those few, if any, Spanish-speaking persons in Port Arthur who do not also *568 speak English are generally persons of advanced years who reside with family members who are fluent in the English language.
66. While Texas has a history of discrimination toward Mexican-Americans (see White v. Regester, supra), such discrimination did not occur in Port Arthur.
67. The Mexican-American, by reason of his cultural, ethnic and language affinity, has a separate identity within Port Arthur.
68. The Mexican-American community has, within Port Arthur, oftentimes banded together to express its vote on issues and candidates within Port Arthur.
69. The creation of single-member city council wards in Port Arthur will effectively dilute the voice and vote of the Mexican-American citizens in Port Arthur because the numbers are so small and the citizens so dispersed geographically that they cannot play any effective role in the election of any candidate from single-member districts, whereas at-large they can constitute a substantial and effective vote as an ethnic bloc.
PARTICIPATION
VIII. POLITICAL EXPERIENCES UNDER PRESENT CHARTER:
70. The system of election in Port Arthur, wherein each candidate must live in the district for which he or she is running, is very different from the at-large plans with no residency requirements.
71. Likewise, the impact upon minorities (Blacks, Browns and women) is also quite different.
72. The original purpose behind an election scheme like that in the City of Port Arthur is to allow the council member to bring both narrow (neighborhood) and broad (city-wide) perspectives into the decision-making process.
73. During the years 1970 through 1977, the City of Port Arthur has had a much higher voter turnout for its general elections than most United States cities.
74. The turnout of Black voters, and White voters, has been substantially the same.
75. The Black voter in Port Arthur has turned out in greater numbers than the White voters since 1975.
76. The Black persons have voted as a bloc since 1975, but this diminished substantially in both the mayor's election and the special election of 1977.
77. This bloc-voting power of the Black citizen is enhanced, rather than diminished, under the type of electoral system existing in Port Arthur.
78. Black turnout in special elections in Port Arthur has been only slightly lower than White turnout.
79. In the 1977 special election involving the consolidation of Pear Ridge, Lakeview and Port Arthur, Black turnout was, proportionately, only half that of White turnout.
80. In the 1977 special consolidation election, Blacks were nearly split in their support for consolidation, whereas Whites were almost unanimous in their support.
81. There was no racial polarization on the issue of consolidation in Port Arthur.
82. Until ninety percent of the Blacks vote one way, and ninety percent of the Whites vote another, racial polarization does not exist.
83. The electoral system itself, based upon election turnout data, does not appear to differ in its impact on Black participation as compared to White participation in elections.
84. There has been a long history of similarity in voting patterns between Black and White voters in Port Arthur. These voting patterns closely resemble each other until the year 1975.
*569 85. Since 1975, racially polarized voting patterns are observable in city council elections.
86. Such racial polarization results largely from an incident involving a Black prisoner, Clifford Coleman, who was fatally injured while escaping from jail.
87. Minority candidacy rates have consistently been higher in Port Arthur than in most municipalities in the country.
88. Forty minority candidates offered themselves for public office in Port Arthur between 1955 and 1977.
89. This is particularly impressive in view of the fact it has been common since 1955 for Black citizens to stand for public office, at a time when few cities were even allowing Blacks to register to vote, let alone run for office.
90. There have been minority candidates for the various district seats between 1955 and 1977 as follows: For District 1, 14 times; for District 2, 3 times; for District 3, 3 times; for District 4, 1 time; for District 6, 3 times.
91. A comparison of candidacy patterns prior to the present at-large plan and after adoption of the present at-large plan in 1963 indicates that prior to 1963, the only Black candidacies actually occurred in the District 1 race.
92. Since 1963 there have been fewer incidences of Black candidates running against other Black candidates, serving to enhance the strength of the Black bloc vote, rather than to divide it.
IX. BLACK PARTICIPATION IN THE PROCESS:
93. Local government in Port Arthur consists, as a practical matter, not only of the elected city council, but of a multitude of appointed boards, committees, commissions, and other appointive agencies which have very substantial input into the decision-making process.
94. Black persons have been appointed by city council and have participated very effectively in the following committees, commissions, agencies, and the like:
(a) Aging Commission;
(b) Advisory Committee on tax-repossessed properties;
(c) Board of Adjustment and Appeals;
(d) Board of Equalization;
(e) City Housing Authority;
(f) Civil Service Commission;
(g) Parks and Recreation Board;
(h) Planning and Zoning Commission;
(i) Pleasure Island Commission;
(j) Port Arthur Landmark Committee;
(k) Urban Renewal Agency;
(l) Community Development Committee;
(m) Clean City Commission;
(n) Port Arthur Convention and Tourist Association Committee;
(o) Port Arthur Civic Center and Activity Center Commission
95. The election of city council members and mayor each two years insures continued accountability to the electorate.
RESPONSIVENESS
X. FISCAL ACCOUNTABILITY:
96. When the 1962 Charter change occurred and the present election system was instituted, the City of Port Arthur, as an entity, was in poor financial condition.
(a) The City had reportedly the highest tax rate in Texas.
(b) Municipal salaries and wages were comparatively very low.
(c) The capital needs of the City to replace an archaic plant were enormous.
(d) The City had undertaken an urban renewal project (R-7) which was on the brink of default, an occurrence which would have severely penalized the City for generations to come.
97. The financial condition of the City of Port Arthur in 1963, and the years following, substantially prevented the City's delivering more than the basic *570 services to any of its citizenry and effectively precluded the expansion of services.
98. Beginning in 1976 the City of Port Arthur has dramatically improved its financial condition, increased employee salaries, reduced its tax rates from $1.73 per hundred to $1.35 per hundred, and greatly enlarged its ability to provide municipal services.
99. The City of Port Arthur, since 1963, reorganized and successfully completed the urban renewal project (R-7) which was on the brink of default, and then developed and successfully completed another urban renewal project (R-93).
100. Both urban renewal projects R-7 and R-93 have materially improved conditions within two areas of the City wherein the majority of the residents are Black.
101. The successful completion of urban renewal projects R-7 and R-93 materially improved the quality of life and living conditions within the neighborhoods affected.
XI. CAPITAL EXPENDITURES:
102. From October 1, 1963 through September 30, 1977, the City of Port Arthur has expended $40,599,983.00 on non-recurring capital expenditures.
103. From October 1, 1963 to September 30, 1977, the City of Port Arthur has spent approximately $31,281,702.00, or 77%, of its capital expenditures in census tract areas where, according to the 1970 census, minority population exceeds 50%.
XII. DECISION-MAKING PROCESS:
104. The successful completion of urban renewal projects R-7 and R-93 materially improved the quality of life and living conditions.
105. Texas law insures open meetings of city council. The City of Port Arthur has scrupulously complied with the intent of the Texas Open Meetings Law. Both city council meetings and work sessions are accessible and open to the public.
106. Black participation in city council meetings and work sessions has been full and effective, reflecting no subtle discrimination or estrangement from the process of government of Black persons.
107. In Port Arthur major capital improvement projects such as the Civic Center, Library, and street improvements, are usually formulated by citizen committees and approved by the voters at large.
108. Salaries comprise 70% of the municipal budget. The balance of the budget expenditures is determined based on input from citizens' organizations, the Mayor, city council and staff.
109. Exceptional sources of City revenue such as general revenue sharing and federal grants involve citizen surveys at public hearings and citizen input at the neighborhood level.
XIII. COMPLAINT PROCESS:
110. The City of Port Arthur has aggressively encouraged citizen input into its service provision functions.
111. The City has developed a "Complaint Process" and vigorously encouraged citizens to avail themselves of municipal services.
112. The City has a special telephone number for citizens to call and register complaints or seek assistance. This telephone number is advertised and is rather heavily utilized.
113. Citizens regularly list and register complaints through the telephone provided therefor, to the Mayor and his staff, to the elected council members, and to the City Manager.
114. A record of the complaint is made, the requested service is investigated, and if necessary, action is taken with respect thereto and a final report is made.
*571 115. During the year June 30, 1977 through June 30, 1978, there were 360 citizen complaints registered and recorded.
Of that number, 190, or 52.77% of complaints received and acted upon by the City of Port Arthur came from persons living in areas where the minority population exceed 50%.
116. There is no evidence of racial discrimination regarding the provision of services within this complaint process.
XIV. EMPLOYMENT POLICIES AND PRACTICES:
Fire and Police:
117. Article 1269m, Tex.Rev.Civ.Stat., governs the employment, promotion, and discipline of fire and police personnel in cities adopting the provisions of the Civil Service Act.
118. The City of Port Arthur, by vote of the citizens, adopted the provisions of Article 1269m in 1948.
119. The City has an entirely lawful nondiscriminatory employment and promotion policy and practice with respect to fire and police personnel.
120. The City of Port Arthur has aggressively recruited fire and police personnel among Black persons.
121. The City has engaged professional Black recruiters and specifically recruited at predominantly Black colleges and universities.
122. The City has aggressively and innovatively adopted a screening procedure which encourages rather than discourages Black persons to apply for and be admitted to the Police Academy at Lamar University.
123. Once a police candidate has completed a course of study at the Lamar University Police Academy and passes an examination required for certification of police personnel by the State of Texas, such applicant is automatically eligible for employment by the City of Port Arthur.
124. The City has engaged the United States Civil Service Commission to validate its police and fire tests and examinations to make certain that same are occupationally relevant and do not contain any racial or cultural bias which will tend to discourage or eliminate Black persons from application, employment, and promotion.
125. There are presently 118 persons within the Police Department of the City of Port Arthur, 13 of whom are Black persons.
126. There are presently 101 persons within the Fire Department of the City of Port Arthur, 2 of whom are Black persons. Beginning in 1964 and continuing through 1977, the City has employed 5 Black persons as firemen, and presently has one Black fireman in the rank of lieutenant.
127. The lack of Black persons on the Fire Department staff is not attributable to either racial discrimination or indifference by City personnel, but rather a combination of factors beyond the control of the City.
128. For the past six years, Mr. Hamilton Joseph, a Black person, has served as one of three members of the City's Civil Service Commission and is a former chairman of such Commission.
129. The Civil Service Commission is the body charged by law with supervising and administering recruitment, employment promotion, and discipline of police and fire personnel.
Non-Civil Service Employees:
130. The City of Port Arthur, on July 17, 1972, adopted an Equal-Employment Opportunity Ordinance.
131. The City of Port Arthur has an Affirmative Action Plan for the employment and promotion of Black persons.
132. The City of Port Arthur has 667 employees.
133. The City of Port Arthur has 231 Black persons as permanent employees.
134. The City of Port Arthur has aggressively recruited and employed personnel without regard to race.
*572 135. There is no evidence of racial discrimination in the recruitment, employment, promotion, and termination of personnel by the City.
136. The following factors reflect the City's continuing commitment to non-discriminatory employment practices:
(a) There are a large number of Black persons employed by the City.
(b) There are a large number of Black persons who apply for positions within the City who are local residents.
(c) It is the policy of the City to employ local citizens when they are able and available for work.
(d) It is the policy of the City to promote from within its own ranks of employees.
(e) It is the policy of the City to provide each of its employees continuing formal education, including the cost of books, tuition and fees at local technical and academic colleges and schools.
137. The City has a substantial number of upper-level Black employees in the departments of public health, inspection, environmental and housing code enforcement, sewer, sanitation, finance, and the office of the mayor.
138. Within the standard metropolitan statistical area (SMSA) which includes Port Arthur, the percentage of Black persons within the available labor force is 20%.
139. Within the City of Port Arthur, including fire and police personnel, the percentage of Black employees is 35%.
140. The City of Port Arthur, as an employer, must compete with local industry for personnel.
141. Presently, the wage offerings of local industry exceed those of the City of Port Arthur at entry level jobs by 30%.
142. There is no evidence indicating the City of Port Arthur is other than an equal-opportunity employer who has a high percentage of Black employees who are recruited, employed, and promoted free from racial discrimination.
XV. HOUSING:
143. The City of Port Arthur adopted on September 3, 1974 an ordinance prohibiting discrimination in housing.
144. There is no segregation of housing within the City of Port Arthur.
145. The City has published ads in local newspapers advising citizens of its anti-discrimination housing ordinances and encouraging complaints be filed in the event of violation. Such advertisements were affirmatively run by the City of Port Arthur April 28, 1977, May 1, 1977, and February 17, 1978.
146. Since adoption of its ordinance prohibiting discrimination in housing, there has been but one complaint brought under such ordinance, which was resolved in favor of the complainant on March 1, 1977.
147. Black persons, and White persons, are diffused throughout the City of Port Arthur, although housing patterns reflect that there are residential neighborhoods of persons dominantly of one race.
XVI. MINORITY BUSINESS RELATIONS:
148. The City has vigorously and successfully encouraged minority-owned businesses to contract with the City.
149. Since 1975 a community development block program has expended $1,998,239.00 in contracts. Of this, $432,256.00 (21.6%) was awarded to minority-owned firms. Under Economic Development Administration funds, the City has awarded contracts totaling $932,168.00. $135,083.00 (14.49%) was awarded to minority-owned businesses.
XVII. SERVICES TO BLACK RESIDENTIAL NEIGHBORHOODS:
Water:
150. All residential areas of the City have full municipal water services at the same uniform rates of service.
*573 151. No Black residential neighborhood is without full municipal water service.
Sanitary-Sewer:
152. All residential areas of the City have full municipal sanitary-sewer service available at the same uniform rates of service, with the exception of about six homes in the Montrose area in the extreme northern reach of the City.
153. There is no discrimination in the provision of sanitary-sewer service or rates for service among the races.
154. The City has undertaken a $32,000,000 sanitary-sewer improvement program which is necessary to bring its system into compliance with federal environmental regulations. This program commitment by the City is wholly free of racial discrimination and will insure service to each home and area of the City.
Other Municipal Services:
155. Full garbage, drainage, fire and police services are provided all residential areas of the City, without discrimination among the races in the provision of service or the rates therefor.
156. Health, park and recreation, and library services are fully provided by the City without discrimination among the races.
157. The City participates significantly in the provision of social services to the elderly, largely of low and moderate income means.
158. The provision of social services to the elderly, including the serving of meals, the provision of transportation, the engagement in daily activities, and employment is provided without racial discrimination.
159. Until 1970, the City of Port Arthur subsidized a private bus system operating within the City which was providing public transportation facilities for low and moderate income persons, largely of the Black race.
160. In 1970, the private transportation company withdrew its services from the City of Port Arthur.
161. Citizens requested the City of Port Arthur to provide public transportation facilities. In 1970, the lack of financial resources prevented the City's providing these services. In 1973, the City made application to the Department of Transportation and began developing a method of providing public transportation facilities. Beginning January, 1979, the City of Port Arthur will enter the area of public transportation and begin operating a public bus system.
162. The provision of public transportation facilities will largely benefit members of the Black race and will be provided without racial discrimination.
163. The City Hall in Port Arthur is an attractive public building used by many groups and organizations throughout the year.
164. The use of City Hall in Port Arthur is free to the citizens and citizen groups. A reservation system is maintained on a "first come-first served" basis. The use of the public building is completely free of racial discrimination.
ENHANCING FACTORS
165. The size of the City, both demographically and geographically, is such that campaigning city wide is done with relative ease and presents no burden or impediment to the candidate forcefully and effectively presenting his ideas to the voters.
166. Campaign cost in city-wide elections within Port Arthur are shown to be a rather nominal amount and do not in any way preclude effective presentation of qualifications and issues to the electorate.
167. Most elections within Port Arthur have involved only two candidates. Hence, the majority vote requirement within Port Arthur has practical similarity to plurality vote provisions in *574 larger communities and does not serve to stifle the expression of minority vote and opinion.
CONCLUSIONS OF LAW
In accordance with the decisions of Whitcomb v. Chavis, 403 U.S. 124, 91 S. Ct. 1858, 29 L. Ed. 2d 363 (1971), White v. Regester, 412 U.S. 755, 93 S. Ct. 2332, 37 L. Ed. 2d 314 (1973), Zimmer v. McKeithen, 485 F.2d 1297 (5th Cir. 1973) (en banc) aff'd on other grounds sub nom. East Carroll Parish School Bd. v. Marshall, 424 U.S. 636, 96 S. Ct. 1083, 47 L. Ed. 2d 296 (1976), Kirksey v. Board of Supervisors of Hinds County, 554 F.2d 139 (5th Cir. 1977); (en banc) cert. den'd 434 U.S. 968, 98 S. Ct. 512, 54 L. Ed. 2d 454 (1977), Nevett v. Sides, 571 F.2d 209 (5th Cir. 1978), Bolden v. City of Mobile, 571 F.2d 238 (5th Cir. 1978), Blacks United for Lasting Leadership, Inc. v. City of Shreveport, 571 F.2d 248 (5th Cir. 1978), Thomasville Branch of NAACP v. Thomas County, 571 F.2d 257 (5th Cir. 1978), the Court has made particularized findings of fact. The Court has considered carefully the four primary factors and the enhancing factors that bear upon the determination of unconstitutional dilution which operates to minimize or cancel out the voting strength of racial or political elements within the voting population. In the aggregate, the evidence and findings lead the Court to conclude that the at-large election of Mayor and City Council in Port Arthur, Texas since 1963:
1. Has not cancelled, diluted or minimized the vote or voting strength of Negro citizens of the City;
2. Does not deny equal protection of the laws nor abridge any rights secured by the Fourteenth or Fifteenth Amendment to the United States Constitution;
3. Was not racially motivated in its origin nor is it racially motivated in its maintenance;
4. Has neither the purpose nor effect of depriving any person full access to, participation in and response from the city government and its processes;
5. Converting the City of Port Arthur to a single-member district of councilmanic election will have the effect of severely impinging the vote of the Mexican-American citizens in the City of Port Arthur, Texas.
Any finding of fact which constitutes a conclusion of law shall be deemed a conclusion of law and any conclusion of law which constitutes a finding of fact shall be deemed a finding of fact.
Judgment shall issue accordingly.
FINAL JUDGMENT
The action came on for trial before the Court, the Honorable William M. Steger, District Judge, presiding, and based upon the Findings of Fact and Conclusions of Law that the existing at-large method of councilmanic election in the City of Port Arthur, Texas, does not contravene the rights of any person or group of persons under the XIVth or XVth Amendments to the Constitution of the United States and it is ORDERED, ADJUDGED and DECREED that plaintiffs shall take nothing by reason of Count One of their Complaint herein.
ORDER ON MOTION TO "SET ASIDE" ELECTION
On November 28, 1978 there came on to be heard and considered the motion of plaintiffs "to set aside election" held in the City of Port Arthur, Texas, on April 1, 1978, wherein the following propositions were submitted to the electorate:
(a) Shall the City Council of the City of Port Arthur be authorized to sell, and by proper instrument in writing, convey to such person, or persons whom the City Council deems advisable, and upon such terms and conditions as said City Council may deem advisable and proper, certain property being more particularly described as follows: All that tract of land commonly known as Pleasure Islet.
(b) Shall the City Council of the City of Port Arthur be authorized to convey to the Lamar University at Port Arthur, *575 upon such terms and conditions as the City Council in its discretion may determine, certain property commonly known as Gates Memorial Library, being a tract of land containing approximately 1.72 acres, bounded by the westerly line of Stilwell Boulevard from the Southerly line of Procter Street to the Northerly Line of Lakeshore Drive, by the Northerly line of Lakeshore Drive from the Westerly line of Stilwell Boulevard to the Easterly boundary line of Lions Park, by the Easterly boundary line of Lions Park from the Northerly line of Lakeshore Drive to the Southerly line of Procter Street, and by the Southerly line of Procter Street, from the Easterly boundary line of Lions Park to the Westerly line of Stilwell Boulevard.
Having determined that a majority of persons voting in said election voted "for" each of said propositions; that balloting was conducted throughout the City of Port Arthur, including the areas of the former cities of Pear Ridge and Lakeview; that separate voting boxes were operated in the former Town of Lakeview, and in the former City of Pear Ridge; that each proposition carried by a majority vote in each voting box provided in the City of Port Arthur as same existed, both before consolidation and after consolidation with the former municipalities of Pear Rige and Lakeview; and that the referendum election of April 1, 1978 involving the two propositions quoted above, based upon consolidation of Port Arthur, Pear Ridge and Lakeview, was not the product of a change in "voting qualification or prerequisite to voting" within the meaning of Section 5 of the Voting Rights Act, 42 U.S.C. § 1973c. It is, therefore
ORDERED that plaintiffs' application to declare void said election is in all things DENIED and the passage of each proposition is hereby CONFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3032076/ | FILED
NOT FOR PUBLICATION JAN 19 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
RICARDO TOPETE CURIEL, No. 06-71639
Petitioner, Agency No. A091-107-546
v.
MEMORANDUM *
ERIC H. HOLDER Jr., Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted January 11, 2010 **
Before: BEEZER, TROTT, and BYBEE, Circuit Judges.
Ricardo Topete Curiel, a native and citizen of Mexico, petitions for review
of the Board of Immigration Appeals’ order summarily affirming an immigration
judge’s (“IJ”) order denying his motion to reopen removal proceedings conducted
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously finds this case suitable for decision without
oral argument. See Fed. R. App. P. 34(a)(2).
LA/Research
in absentia. We have jurisdiction pursuant to 8 U.S.C. § 1252. Reviewing for
abuse of discretion, Celis-Castellano v. Ashcroft, 298 F.3d 888, 890 (9th Cir.
2002), we deny the petition for review.
The IJ did not abuse her discretion in denying Topete Curiel’s motion to
reopen because he did not meet his burden to establish that his panic attack
constituted “exceptional circumstances” under 8 U.S.C. § 1229a(e)(1). See id. at
892 (agency properly denied motion to reopen supported only by alien’s
declaration that he suffered an asthma attack and hospital form that did not indicate
severity of illness).
Petitioner’s remaining contentions are not supported by the record.
PETITION FOR REVIEW DENIED.
LA/Research 2 06-71639 | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1582059/ | 329 N.W.2d 660 (1983)
In re ESTATE OF Harold E. HAWK, Deceased; Margueritte Hudson; and Lois Owen, Appellees,
v.
Lorena A. LAIN, Appellant,
and Iowa Trust and Savings Bank, Defendant.
No. 67879.
Supreme Court of Iowa.
February 16, 1983.
*661 Dwight W. James and William A. Wickett of James & Galligan, P.C., Des Moines, for appellant.
Ronald L. Sutphin of Peddicord, Simpson & Sutphin, P.C., Des Moines, for appellees.
James G. Milani, Centerville, for defendant bank.
Considered by LeGRAND, P.J., and McCORMICK, McGIVERIN, LARSON, and SCHULTZ, JJ.
LARSON, Justice.
The defendant, Lorena Lain, appeals from a declaratory judgment that she is not the child of the decedent, Harold E. Hawk. She argues that although she was born while her mother was married to another man, blood tests and other evidence successfully rebutted the presumption that she was the husband's child. She contends Hawk was her natural father, and she is entitled to inherit from him because (1) Hawk and her mother were married after her birth, legitimatizing her under Iowa Code section 595.18; and (2) she is entitled to inherit under Iowa Code section 633.222 even if she was not legitimatized because of Hawk's "general and notorious" recognition of her as his child. On our de novo review, Iowa Code section 633.33, we conclude the presumption of paternity by her mother's husband was rebutted, that Hawk's paternity was established, and that Lorena was legitimatized through Hawk's marriage to Lorena's mother. Accordingly, we reverse.
Harold E. Hawk died intestate in 1980. When his estate was opened, Nancy J. Hawk was shown as his surviving spouse, and three children were listed as heirs: Margueritte Hudson and Lois Owen, Hawk's daughters by a prior marriage, and Harold Hawk, Jr., the son of Hawk and Lorena's mother. Later, a supplemental probate inventory was filed amending the value of certain assets and adding the name of Lorena Lain as a daughter. Daughters Margueritte and Lois filed this petition for declaratory judgment to establish that Lorena *662 is not a child of the decedent and therefore ineligible to share in his estate.
I. Presumption of Legitimacy.
At the time of Lorena's birth, her mother was married to Leslie Plants. Lorena's last name was Plants, and the evidence showed that, prior to Hawk's death, she had believed she was Plant's daughter. A child born in wedlock is presumed to be legitimate, although the presumption may be rebutted by "clear, strong and satisfactory" evidence. In re Marriage of Schneckloth, 320 N.W.2d 535, 536 (Iowa 1982); Kuhns v. Olson, 258 Iowa 1274, 1276, 141 N.W.2d 925, 926 (1966).
Lorena relies on testimony by her mother and the results of blood tests to show she could not have been the child of Leslie Plants. The trial court concluded the evidence fell short of rebutting the presumption, despite the blood test results which showed there was no possibility Plants could have been the father. The court further concluded that the testimony of Nancy Hawks, Lorena's mother, was "unpersuasive" and that the effect of evidence tending to show Plants was the father outweighed the blood test evidence. To reach any other conclusion, the plaintiffs now argue, would be tantamount to giving conclusive effect to the blood test.
In Schneckloth, we quoted from Little v. Streater, 452 U.S. 1, 6-7, 101 S. Ct. 2202, 2206, 68 L. Ed. 2d 627, 633 (1981), in assessing the weight to be given to modern blood tests for paternity:
As far as the accuracy, reliability, dependabilityeven infallibilityof the tests are concerned, there is no longer any controversy. The result of the test is universally accepted by distinguished scientific and medical authority. There is, in fact, no living authority of repute, medical or legal, who may be cited adversely. . . . [T]here is now. . . practically universal and unanimous judicial willingness to give decisive and controlling evidentiary weight to a blood test exclusion of paternity.
(quoting from 1 S. Schatkin, Disputed Paternity Proceedings § 9.13 (1975)). We did not give the blood test conclusive effect in Schneckloth, holding only that under our de novo review the statutory presumption that the husband was the father of the child had been successfully rebutted.
Similarly, while we do not hold the blood tests are conclusive here, we believe that the tests, together with the other evidence, particularly the testimony of Lorena's mother, have rebutted the presumption of legitimacy. We conclude Lorena was not the daughter of Leslie Plants.
II. Effect of Illegitimacy.
Showing she is not the daughter of Leslie Plants, of course, does not establish Lorena's right to inherit from Harold Hawk. She must establish (1) that she is the daughter of Harold Hawk and (2) either that she was openly and notoriously recognized by him as his daughter, Iowa Code section 633.222, or legitimatized by the marriage of Hawk and her mother. Iowa Code § 595.18.
A. Evidence of Hawk's paternity. A showing of paternity requires only a preponderance of the evidence. Forman v. Wilcox, 305 N.W.2d 703, 704 (Iowa 1981); Brown v. Middleton, 259 Iowa 1140, 1142, 147 N.W.2d 40, 41 (1966); Kuhns, 258 Iowa at 1276-77, 141 N.W.2d at 926-27; Spears v. Veasley, 239 Iowa 1185, 1186-87, 34 N.W.2d 185, 186 (1948). The blood grouping tests of the type showing nonpaternity of Leslie Plants are of no help in resolving this issue; no sample of Hawk's blood was available for analysis. We must look to other evidence on that question. While other evidence, including photographs, lend support to Lorena's claim, we believe the most compelling is the testimony of Lorena's mother that Hawk was the father.
While the trial court's findings are entitled to weight, see Forman, 305 N.W.2d at 704, especially since it had a better opportunity to weight the credibility of witnesses, we take a different view of the evidence. Nancy Hawk is obviously in the best position to know who the father of her child *663 was. It is true she had earlier demanded child support from Plants on the ground Lorena was his daughter, but the blood test showed that was not the case. And, while it is also true, there was speculation at the trial that other men had been seeing Nancy at the time Lorena was conceived, there was no evidence as to who they were, or the extent of their relationship with her.
Moreover, while the trial court found Nancy to be motivated by a "misguided sense of motherly protectiveness" in testifying to Hawk's paternity, we note that she stood to gain nothing financially from it, and in fact, acted against her own interests when she testified to this illicit relationship.
Upon examination of the whole record, we conclude that a preponderance of the evidence supports Lorena's claim that Harold Hawk was her father.
B. The effect of the marriage. Following Nancy's divorce from Plants, she moved in with Hawk, who was also divorced, and the two began a common-law marriage. No one disputes that the parties were legally married. See In re Marriage of Winegard, 278 N.W.2d 505, 510-11 (Iowa 1979) (recognizing common law marriages in Iowa).
Assuming, as we have found, that the presumption of legitimacy has been rebutted and Hawk's paternity is established, the issue presented is whether the common law marriage of Hawk and Nancy legitimatize Lorena under Iowa Code section 595.18, which provides:
Illegitimate children become legitimate by the subsequent marriage of their parents. Children born of a marriage in violation of section[s] 595.3 [license provisions] or 595.19 [void marriages] are legitimate.
These plaintiffs contend, and the trial court held, that this section is inapplicable because it applies only to an illegitimate child, which Lorena was not, and only if Lorena proves Hawk was her father, which she failed to do. We have, of course, resolved those issues adversely to the plaintiffs. Lorena was legitimatized by the common law marriage, under section 595.18. Other courts addressing this issue under similar statutes agree. See, e.g., In re Succession of Mitchell, 323 So. 2d 451 (La.1975); Sacks v. Sacks, 267 So. 2d 73 (Fla.1972) (birth made legitimate by common law marriage), Robinson v. Ruprecht, 191 Ill. 424, 61 N.E. 631 (1901); Annot., Legitimation by Marriage to Natural Father, 80 A.L.R. 3d 219 (1977).
We conclude that Lorena has established her right to share in the estate of Harold Hawk and accordingly reverse the trial court.
REVERSED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582051/ | 329 N.W.2d 107 (1983)
213 Neb. 322
CHAPMAN COMPANY, INC., Appellee,
v.
WESTERN NEBRASKA BROADCASTING CO., INC., et al., Appellants.
No. 81-744.
Supreme Court of Nebraska.
January 14, 1983.
*108 Thomas D. Brower and Paul E. Hofmeister of Van Steenberg, Brower, Chaloupka, Mullin & Holyoke, Gering, for appellants.
Harris & Lippstreu, Scottsbluff, for appellee.
KRIVOSHA, C.J., and BOSLAUGH, McCOWN, CLINTON, WHITE, HASTINGS, and CAPORALE, JJ.
KRIVOSHA, Chief Justice.
The instant appeal presents to the court a question of first impression concerning the proper interpretation of a broker's contract for the sale of a business. Following trial to a jury a verdict was returned by the jury in favor of the broker, Chapman Company, Inc., and against the owners of radio station KEYR in the amount of $21,650. For reasons which we more particularly set out in this opinion, we believe that the instruction given by the court to the jury was erroneous and therefore the verdict of the jury must be set aside and a new trial granted.
The undisputed record discloses that the appellants, Western Nebraska Broadcasting Co., Inc. (Western), Guy W. Embree (Embree), and Richard W. Baumgartner (Baumgartner), jointly referred to as (Western), owned and operated radio station KEYR in Terrytown, Nebraska. At some point they determined that they wished to sell the station and listed it with the appellee, Chapman Company, Inc. (Chapman), a broker engaged in the business of selling radio stations. In connection with this listing Western signed an exclusive brokerage agreement with Chapman on August 11, 1977. The agreement gave Chapman the exclusive right to sell the stock of Western and gave Western the right to terminate the contract at any time after the contract had been in effect 60 days, upon giving 30 days' notice. The evidence discloses the agreement to be a fairly simple document, setting out that Western was desirous of selling all of its stock for the price of $380,000. Under the terms of the agreement Chapman was likewise to perform certain activities on behalf of Western for the purpose of selling the stock. The agreement provided for a schedule of compensation to be paid by Western to Chapman in the event of a sale. The agreement further *109 contained a provision which is the issue of this lawsuit. The contract specifically provided that even if the agreement was terminated, "[o]n any sale during the ensuing 12 months to a prospect solicited by Broker during the authorization, Broker is to be paid the same commission." (Emphasis supplied.) The agreement does not define the term "solicit," and it is this absence of a definition which causes the difficulty. The provision quoted is what is generally referred to in the trade as an "extension clause" and, according to the evidence, is intended to protect the broker in the event that he obtains a purchaser for the owner and the parties simply delay closing until after the listing agreement expires. See, Whiting v. Johnson, 64 Wash.2d 135, 390 P.2d 985 (1964); Annot., 51 A.L.R. 3d 1149 (1973).
The evidence further discloses that in January of 1977 Chapman had been contacted by a James Bickling, who was interested in buying a radio station in the Montana, Minnesota, North Dakota, or South Dakota areas. At this same time Bickling also contacted four other radio station brokerage firms advising them of his interest in purchasing a radio station in that fourstate area. On January 24, 1977, he completed and returned Chapman's "buyer outline" form in response to a request for more specific information. Over the next 1½years, Bickling received numerous mailings from all five brokers with regard to various radio properties. In August of 1977, pursuant to the broker agreement, Chapman initiated a mass mailing to 171 potential buyers, including Bickling, announcing that KEYR was available for purchase. Bickling denies ever receiving this initial offering letter. It is, in any event, undisputed that he made no response to such letter even if, in fact, he received it.
On January 12, 1978, Western notified Chapman of its desire to terminate the listing contract with Chapman, effective March 1, 1978. Following receipt of the notice Chapman sent out a second mass mailing on January 16,1978, to an additional 152 people, bringing the total number of names on its mass mailing list to 323. This list was later mailed to Western in response to Western's request for a list of "prospects."
On March 16, 1978, Embree and Baumgartner listed KEYR with another radio brokerage firm by the name of Dan Hayslett & Associates. The evidence discloses that, by sheer coincidence, Hayslett had purchased the assets of a brokerage firm that Bickling had contacted in January of 1977. The assets purchased by Hayslett included a mailing list which contained Bickling's name as a potential buyer of radio stations.
On April 3,1978, Hayslett sent out letters and brochures to buyers it thought might be interested in purchasing KEYR. This mailing was received by Bickling and, according to Bickling's testimony, was the first notice he had that KEYR was for sale. Shortly thereafter, Bickling contacted Hayslett and preliminary negotiations began. The final agreement for the purchase of KEYR was signed on August 28, 1978, and the sale was consummated on November 1, 1978. Chapman admittedly was in no way involved with any of these negotiations or with the completion of the sale of KEYR to Bickling.
In September of 1978 Chapman read of the sale of KEYR in BROADCASTING MAGAZINE. As a result of that, he wrote a letter to Embree and Bickling requesting payment of the broker's commission as provided for in the listing contract. He maintained that Bickling was one of the 323 individuals that Chapman had "solicited" during the term of the agreement and that by reason of the extension clause he was entitled to be paid. Embree and Baumgartner rejected the claim and instead paid the commission to Hayslett. Thereafter, Chapman instituted this action. While a number of issues are raised, both by Western and by Chapman, the seminal question which must be addressed is whether Chapman "solicited" Bickling within the meaning of the broker agreement so as to entitle Chapman to a commission in the amount of $21,650 when Bickling purchased KEYR *110 from Western through Hayslett. Chapman argues that under the terms of the agreement all Chapman was required to do to earn its commission was to "solicit" or "contact" someone who purchased the station during the 12-month period, even if Chapman had no other contacts with the purchaser. The determination of the question in this case, therefore, depends upon the correctness of the trial court's instruction No. 7. By instruction No. 7, the trial court instructed the jury as follows: "The word `solicit' means `to ask, to urge, to appeal (for something), to invite, to try to obtain or to furnish information designed to persuade a person to do a particular act.' `Solicit' does not imply successful solicitation or require a response. Solicitation does not require any particular form nor does it require a particular degree of earnestness or persistance [sic]." If instruction No. 7 correctly reflects the law in Nebraska, then the verdict of the jury was correct. If, however, the instruction was not correct because the jury needed to be instructed that something more than an unsuccessful and unresponsive solicitation was required, then the verdict must of necessity be set aside. As we indicated at the outset, we believe that the instruction was not correct and therefore the judgment must be set aside.
Investigation discloses that there appears to be no specific Nebraska decision deciding what the word "solicit" in a business brokerage contract of this type means. In construing extension clauses other courts have generally resorted to two approaches in determining whether the broker is entitled to the commission claimed by reason of the "extension clause." One group, though by far the minority, has taken the position that the broker need only establish that his activities and efforts met or measured up to the conditions specified in or required by the language of the clause in question. These courts have made it clear that the parties to a listing contract are free to frame their agreement in whatever terms they may see fit, provided that such terms are neither unlawful nor contrary to public policy, and that in so doing they may make a broker's right to compensation depend upon the happening of any designated event or upon the fulfillment of any particular set of circumstances, even though neither the event nor the circumstances result in procuring a purchaser. The theory of those cases apparently is that if the owner wishes to impose a greater obligation on the broker, he should specify it in the agreement. See, Galbraith v. Johnston, 92 Ariz. 77, 373 P.2d 587 (1962); Leonard v. Fallas, 51 Cal. 2d 649, 335 P.2d 665 (1959); Delbon v. Brazil, 134 Cal. App. 2d 461, 285 P.2d 710 (1955); Wright & Kimbrough v. Dewees, 52 Cal. App. 42, 197 P. 957 (1921); Moore v. Holman Real Estate Co., 129 Ark. 465, 196 S.W. 479 (1917). In essence, this is the position which Chapman convinced the trial court to take and which is now urged upon us.
The majority of the courts, however, have not been willing to accept so unlimited a definition for the word "solicit" in a broker's agreement. Instead, the majority of courts have held that before a broker may be entitled to a commission, the broker must ordinarily be able to establish at least some causal connection between the broker's actions and efforts in regard to the listed property and the ultimate sale made to the purchaser under an extension contract of the type involved herein. While those courts have not gone so far as to require a showing that the broker was the "procuring cause" of the sale, unless the contract contained specific language making it incumbent upon the broker to be the procuring cause, they have required more than just a blanket mailing even to a selected group. The nexus between the broker's efforts and the ultimate sale will vary with the language of the clause in question. In every instance, however, more is required than a mere unresponded to solicitation by mass mailing, as was done in this case. See, Harkey v. Gahagan, 338 So. 2d 133 (La. App.1976); Lloyd Hammerstad, Inc. v. Saunders, 6 Wash.App. 633, 495 P.2d 349 (1972); Korstad v. Hoffman, 221 Cal. App. 2d 805, 35 Cal. Rptr. 61 (1963); Mellos v. Silverman, 367 So. 2d 1369 (Ala.1979).
*111 As we indicated at the outset, there appears to be no Nebraska case directly on point. In attempting to reach what we perceive to be an appropriate balance between protecting the rights of the broker, on the one hand, under such a "soliciting contract" and yet providing the owner of the property with some reasonable protection, on the other, we believe that the better-reasoned cases by far are those which have required that before a broker may recover for "soliciting" the broker must show some causal relation between his efforts and the ultimate sale. The language of the Louisiana Court of Appeals in the case of Harkey v. Gahagan, supra at 135, best explains that reason when it points out: "The purpose of the extension clause in a real estate listing contract is to insure the realtor's right to a fee when the property owner sells the property subject to the listing after the expiration of the primary term to a purchaser who had been located or otherwise interested in the property by the realtor's effort. The realtor does not have to be the procuring cause in order to activate the extension clause. He need not have been involved in active negotiation with the purchaser at the time of the expiration of the primary term. However, his activities must have been the cause of creating some minimal interest in the purchaser which contributed to bringing about the eventual sale." We see little difference between a contract to sell real estate and a contract to sell a business. We believe that this notion that the broker must have been "the cause of creating some minimal interest in the purchaser" is indeed the appropriate balance between the argument made by Chapman, on the one hand, that consenting adults ought to be permitted to enter into unambiguous agreements as they choose and the argument of appellants, on the other hand, that merely permitting one to send out a mass mailing should be insufficient to constitute a solicitation sufficient to entitle a broker to receive a commission. Obviously, were we to adopt the position taken by Chapman, and apparently accepted by the trial court, every broker need only send out a letter to every individual on a mass mailing list and thereafter be protected from any sale which might occur during the extension period. We believe that such a rule would serve no useful purpose and would only burden the owner's right to dispose of his property in spite of the original broker's inability to provide an interested buyer. We believe that the minimal contact rule is the rule which provides the best balance, and we now adopt that rule for this jurisdiction. The rule, therefore, in this jurisdiction is to the effect that where a broker and the owner of a business enter into a brokerage agreement which contains an extension clause entitling the broker to the payment of a commission in the event a sale occurs after termination of the brokerage agreement, but during the extension period, to any "prospect solicited by the broker during the contract period," the broker must show some minimal causal connection between the efforts of the broker and the ultimate sale before the broker may receive the compensation. Because of our holding, we must find that the court's instruction No. 7 was erroneous, and therefore we must reverse the judgment and remand this action back to the District Court with instructions to retry the case in accordance with this decision.
REVERSED AND REMANDED FOR A NEW TRIAL.
CLINTON, J., not participating. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582075/ | 122 Mich. App. 1 (1982)
329 N.W.2d 513
PEOPLE
v.
GARY WILSON
Docket No. 53430.
Michigan Court of Appeals.
Decided December 8, 1982.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward Reilly Wilson, Principal Attorney, Appeals, and A. George Best, II, Assistant Prosecuting Attorney, for the people.
Mark R. Hall, for defendant on appeal.
Before: DANHOF, C.J., and N.J. KAUFMAN and D.C. RILEY, JJ.
PER CURIAM.
Defendant was convicted of assault with intent to do great bodily harm less than murder in violation of MCL 750.84; MSA 28.279, following a jury trial. He was sentenced to serve from 6-1/2 to 10 years in prison. Defendant appeals his conviction as of right.
*2 The only issue defendant presents on appeal which merits discussion is his claim that the trial court failed to properly instruct the jury concerning his theory of the case. With respect to this issue, defendant appears to confuse two distinct concepts. He argues that a trial court is required to instruct sua sponte on defendant's theory of the case and the law as it relates thereto.
It is well-established that, where the theory presented to the jury by defendant is a central issue in defendant's trial, the trial court is required to instruct the jury as to the law on that issue even if defendant fails to request such an instruction. People v Ora Jones, 395 Mich. 379, 394; 236 NW2d 461 (1975); People v Stanley Jones, 69 Mich. App. 459, 461; 245 NW2d 91 (1976); People v Morris, 99 Mich. App. 98; 297 NW2d 623 (1980); People v Newman, 107 Mich. App. 535, 537; 309 NW2d 657 (1981); People v Hearn, 100 Mich. App. 749, 753; 300 NW2d 396 (1980); People v Rone (On Second Remand), 109 Mich. App. 702, 713; 311 NW2d 835 (1981); People v Paquette, 114 Mich. App. 773, 779; 319 NW2d 390 (1982); People v Jansson, 116 Mich. App. 674, 685-687; 323 NW2d 508 (1982). At least one panel of this Court has relied on these opinions to conclude that the trial court is also required to sua sponte present to the jury defendant's theory of the case. People v Gayton, 81 Mich. App. 390, 394; 265 NW2d 344 (1978). With this conclusion we cannot agree. The law by which a case is to be decided is distinguishable from a party's theory. People v Robinson, 79 Mich. App. 145, 162; 261 NW2d 544 (1977). The duty of the trial court to present a party's theory is governed by GCR 1963, 516.7:
"(a) The court shall present to the jury the issues in *3 the case and, if a party requests after the close of the evidence, that party's theory of the case.
"(b) After the close of the evidence each party shall submit in writing to the court a statement of the issues and, if a party makes a request under subrule .7(a), his theory of the case as to each issue. * * * The theory may include those claims supported by the evidence or admitted." (Emphasis supplied.)
In our opinion, the trial court is not required to present defendant's theory to the jury unless defendant makes a request for the same. People v Trammel, 70 Mich. App. 351, 353-354; 247 NW2d 311 (1976); People v Samuel Smith, 85 Mich. App. 404, 414; 271 NW2d 252 (1978), rev'd in part on other grounds 406 Mich. 945; 277 NW2d 642 (1979); People v Peery, 119 Mich. App. 207; 326 NW2d 451 (1982).
In the present case, defendant does not claim that a legally recognized defense was presented concerning which the trial court inadequately instructed the jury. Rather, he merely claims that reversal is required because the trial court failed to sua sponte present to the jury his theory of the case. For the reasons stated above, defendant's claim is rejected.
We have also examined defendant's remaining claims and find them to be without merit. People v Hampton, 407 Mich. 354; 285 NW2d 284 (1979); People v Delongchamps, 103 Mich. App. 151, 159; 302 NW2d 626 (1981); People v Coyle, 104 Mich. App. 636, 639; 305 NW2d 275 (1981).
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582053/ | 110 Wis. 2d 693 (1983)
329 N.W.2d 399
STATE of Wisconsin, Plaintiff-Respondent-Cross-Petitioner,
v.
Larry STUBBENDICK, Defendant-Appellant-Petitioner.
No. 81-908-CR.
Supreme Court of Wisconsin.
Argued December 2, 1982.
Decided February 3, 1983.
*694 For the defendant-petitioner there were briefs by Raymond E. Krek and Krek, Ebbott & Friederichs, S.C., Jefferson, and oral argument by Raymond E. Krek.
For the plaintiff-respondent-cross-petitioner the cause was argued by Chris Heikenen, assistant attorney general, with whom on the brief was Bronson C. La Follette, attorney general.
Reversing in part and affirming in part 107 Wis. 2d 739, 321 N.W.2d 364.
STEINMETZ, J.
The defendant was sentenced for six years as a result of a plea bargained no contest plea to second degree sexual assault. The issue is whether upon vacating that plea and sentence, the judge properly increased the sentence for a second conviction on the same charge. Also at issue is whether the judge is limited as to the sentence that may be imposed for a conviction of burglary which was a related offense to the sexual assault charge, but which had been dismissed as a result of the same plea bargain and then reinstated.
Larry Stubbendick was originally charged with burglary and second degree sexual assault arising from an incident in which the defendant entered the victim's premises without consent through a second-story patio *695 door and sexually assaulted her. By the terms of a plea bargain agreement reached April 18, 1979, the defendant originally pled no contest to the charge of second degree sexual assault. In return the state made no recommendation as to sentence and dismissed the additional pending charge of burglary. A judgment of conviction was rendered on July 12, 1979, by the Honorable Mark J. Farnum, circuit court of Rock county, and entered on July 16, 1979. The court imposed a six year sentence, based solely on the sexual assault charge.
In a decision entered June 26, 1980, the trial court granted the defendant's motion to withdraw his plea. The motion was granted on the grounds that at the time the defendant entered his plea, he was unaware of the mental state requirement of second degree sexual assault. The court vacated the conviction and sentence, and also the previously dismissed burglary charge was reinstated.
The defendant was tried by a jury on both counts, burglary and second degree sexual assault, on October 28-31, 1980, again in Rock county circuit court before Judge Farnum. The jury found the defendant guilty of burglary but was unable to reach a verdict on second degree sexual assault. Sentencing on the conviction for the burglary charge was withheld pending another trial on the sexual assault charge. On December 15-17, 1980, the defendant was tried before a second jury on the sexual assault charge and the jury returned a guilty verdict.
The defendant was sentenced once again on January 8, 1981, by Judge Farnum. The judge sentenced the defendant to concurrent terms of ten years on the burglary and sexual assault charges, less credit for time previously served.
On March 24, 1981, the defendant filed a motion before Judge Farnum requesting modification of his sentence. That motion was denied. The defendant appealed.
*696 The court of appeals held, in an unpublished opinion filed March 26, 1982, that the increase of sentence from six to ten years for the second degree sexual assault charge was not based upon objective facts which were unknown to the trial court at the time of the first sentencing, and reduced the defendant's sentence for sexual assault to six years. However, the court of appeals affirmed the ten year sentence for burglary since that was an original sentence and not a resentence. The court of appeals did not find actual vindictiveness on the part of the trial court in either sentence.
We accepted the defendant's petition for review and also the state's petition for cross-review on June 1, 1982.
In State v. Leonard, 39 Wis. 2d 461, 159 N.W.2d 577 (1968), this court first addressed the problem of resentencing after the successful pursuit of postconviction remedies. The rule adopted by the court was as follows:
"Hereafter, on resentencing following a second conviction after retrial, or mere resentencing, the trial court shall be barred from imposing an increased sentence unless (1) events occur or come to the sentencing court's attention subsequent to the first imposition of sentence which warrant an increased penalty; and (2) the court affirmatively states its grounds in the record for increasing the sentence." Id. at 473.
One year later, the United States Supreme Court in North Carolina v. Pearce, 395 U.S. 711 (1969), delineated the scope of judicial discretion in resentencing. The court stated:
"We hold, therefore, that neither the double jeopardy provision nor the Equal Protection Clause imposes an absolute bar to a more severe sentence upon reconviction. A trial judge is not constitutionally precluded, in other words, from imposing a new sentence, whether greater or less than the original sentence, in the light of events subsequent to the first trial that may have thrown new light upon the defendant's `life, health, habits, conduct, *697 and mental and moral propensities.' Williams v. New York, 337 U.S. 241, 245. Such information may come to the judge's attention from evidence adduced at the second trial itself, from a new presentence investigation, from the defendant's prison record, or possibly from other sources. The freedom of a sentencing judge to consider the defendant's conduct subsequent to the first conviction in imposing a new sentence is no more than consonant with the principle, fully approved in Williams v. New York, supra, that a State may adopt the `prevalent modern philosophy of penology that the punishment should fit the offender and not merely the crime.'" Id. at 723.
The Pearce majority then considered the impact of the due process clause of the Fourteenth Amendment on resentencing. The court stated:
"It can hardly be doubted that it would be a flagrant violation of the Fourteenth Amendment for a state trial court to follow an announced practice of imposing a heavier sentence upon every reconvicted defendant for the explicit purpose of punishing the defendant for his having succeeded in getting his original conviction set aside." Id. at 723-24.
The court continued:
"Due process of law, then, requires that vindictiveness against a defendant for having successfully attacked his first conviction must play no part in the sentence he receives after a new trial. And since the fear of such vindictiveness may unconstitutionally deter a defendant's exercise of the right to appeal or collaterally attack his first conviction, due process also requires that a defendant be freed of apprehension of such a retaliatory motivation on the part of the sentencing judge." Id. at 725.
The rule of North Carolina v. Pearce appears at 395 U.S. 726:
"In order to assure the absence of such a motivation, we have concluded that whenever a judge imposes a more severe sentence upon a defendant after a new trial, *698 the reasons for his doing so must affirmatively appear. Those reasons must be based upon objective information concerning identifiable conduct on the part of the defendant occurring after the time of the original sentencing proceeding. And the factual data upon which the increased sentence is based must be made part of the record, so that the constitutional legitimacy of the increased sentence may be fully reviewed on appeal."
This court considered North Carolina v. Pearce in Denny v. State, 47 Wis. 2d 541, 544, 178 N.W.2d 38 (1970) and recognized that Pearce contained an ambiguity regarding what constituted a proper objective factor. One portion of Pearce states that the reasons for imposing a harsher sentence must be based on "identifiable conduct . . . occurring after the time of the original sentencing proceeding." 395 U.S. at 726. Yet another section of the opinion says that a judge may increase the sentence "in the light of events subsequent to the first trial that may have thrown new light upon the defendant's `life, health, habits, conduct, and mental and moral propensities.'" 395 U.S. at 723.
We adopted Justice White's concurrence to resolve this ambiguity. Justice White stated a trial judge could consider "any objective, identifiable factual data not known to the trial judge at the time of the original sentencing proceeding." 395 U.S. at 751 (J. White, concurring in part), quoted in Denny v. State, 47 Wis. 2d at 545-46. Other courts have resolved the Pearce ambiguity similarly. See e.g., United States v. Hayes, 676 F.2d 1359 (11th Cir. 1982), petition for cert. filed on other issue, 51 U.S.L.W. 3341 (U.S. Sept. 29, 1982) (No. 82-684).
In summary, the Pearce-Denny rule is designed to prevent a trial judge from being vindictive against a defendant for exercising his rights. The possibility of vindictiveness is eliminated since a trial judge can increase a sentence only if new objective factors can justify a more severe sentence. A trial judge is allowed to consider *699 all events occurring subsequent to the first sentence or not known by the court at the time of the initial sentence.
[1]
Subsequent United States Supreme Court cases have developed the principles set forth in Pearce.[1] Most recently in United States v. Goodwin, ___ U.S. ___, 102 S. Ct. 2485 (1982), the court for the first time labeled the rule in Pearce as a presumption of vindictiveness. This characterization in Pearce is consistent with this state's doctrine of abuse of sentencing discretion. This state has long required that reasons be stated on the record for imposing a particular sentence, whether it be an original sentence or a resentence. McCleary v. State, 49 Wis. 2d 263, 282, 182 N.W.2d 512 (1971). For a trial judge not to state sufficient reasons for any sentence constitutes an abuse of discretion. This requirement eliminates the possibility of a judge being vindictive. Furthermore, the Leonard and Denny decisions limit the scope of that discretion when resentencing by requiring that the reasons stated be objective and identifiable. Where a sentencing or resentencing record exhibits actual vindictiveness, that too would constitute an abuse of discretion.
*700 In this case, when sentenced after trial, the defendant received an additional four years on the sexual assault charge and an original ten year sentence on the burglary charge. We will consider the propriety of each sentence separately.
Regarding the enhanced sexual assault sentence, there are essentially three newly known objective factors that justify the four year increase. They include: (1) leniency based on a plea agreement is not necessarily applicable at a resentencing after trial; (2) defendant's poor prospects for rehabilitation; and (3) amplified knowledge of the defendant's criminal activity obtained from the trial. Each factor will be discussed.
One consideration stated by the judge was that he extended leniency at the initial sentencing as a result of the plea agreement. The United States Supreme Court has accepted the practice of extending leniency in plea negotiations as a legitimate process. In Corbitt v. New Jersey, 439 U.S. 212, 223 (1978), the court stated: "[I]t is not forbidden to extend a proper degree of leniency in return for guilty pleas."
The judge at the initial sentencing described the crime as extreme and vicious in its nature. The defendant argues that since the judge gave a six year sentence for a "vicious-extreme" crime on the plea bargain, no leniency was in fact extended. Moreover, the defendant notes that at the first sentencing, the judge made no statement concerning leniency. Nonetheless, we believe that leniency was extended at the initial sentencing. Before the plea bargain, the defendant faced an exposure of 20 years, ten years for the burglary count and ten years for the sexual assault count. Receiving only a six year sentence for such a "vicious-extreme" crime can certainly be partially attributable to an extension of leniency.[2]
*701 Related to the factor of leniency granted on the plea bargain sentence is the judge's finding that the defendant lacked penitence and remorse for having committed the offenses. At resentencing, the judge commented:
"I feel that you obtained your new trial almost fraudulently, Mr. Stubbendick. Now, you can blame it on counsel, counsel can take the blame if they want to, maybe, but you are accountable for what's done and that reflects, then, on my belief in your penitence and remorse because the motion for new trial was predicated on your intoxication, if I recall correctly, or at least on your total lack of memory. And when we tried the case, both times, there wasn't an iota of testimony that had any bearing whatsoever on your mental capacity to commit the crime. . . .
"So under those circumstances, the Court feels that there was some misleading. While I can't hold you responsible for the total trial tactics employed, but to me it indicates a degree of lack of good faith in withdrawal of a plea, because if your mental state was not sufficiently material to be presented as a defense, then it certainly was not sufficiently material as a premise for withdrawal of plea under the circumstances. And I feel it reflects directly on the question of your penitence."
Defendant argues this statement evidences vindictiveness on the trial judge's part for punishing the defendant for withdrawing his plea based on his unawareness of the mental state requirement of the crime, and subsequently not presenting any evidence concerning his mental state at trial. However, this position ignores the fact that the statement relates only to the defendant's lack of penitence.
At the first sentencing, the defendant expressed remorse and penitence about his activities. After the judge had the opportunity to observe the defendant during two *702 trials, he became convinced that any remorse expressed by the defendant was feigned. Any leniency based on remorse was therefore no longer appropriate at the resentencing.
Since the defendant withdrew his plea, any leniency based on the plea need not be extended at resentencing. To hold otherwise, would permit defendants to make tentative pleas of guilty to obtain a ceiling for sentencing upon subsequent trials or pleas. In addition, defendants would be encouraged to set aside plea agreements because they would have everything to gain and nothing to lose by going to trial. The judge was correct to consider the factor of leniency present in a plea agreement at the resentencing.
A second factor was that at resentencing, the judge did not believe the defendant to be a good candidate for rehabilitation. In the presentence report for the second sentencing, the judge was informed:
"Since being received at the institution Larry had received no condition reports and has had excellent adjustment. In June, 1980, Larry was granted medium-out custody at the request of his job supervisor in the electrical maintenance and carpentry department. Such custody classification calls for retention in WCI, but does allow special privileges for work detail assignments off the grounds of the institution proper. The June, 1980, Institution Program Review indicates that Larry had been involved in a counseling program, but dropped out after one month because he disagreed with the particular counseling philosophy."
While the first two items are favorable to the defendant, the last item is not. The probation and parole agent working for the Bureau of Corrections in Rock county testified in regard to this last item as follows:
"Q. Would you tell the Court what reasons Larry gave you for dropping out of that program?
*703 "A. Larry indicated to me in a contact down at the County Jail that he dropped out of that counseling program due to the fact that they only wanted him to talk about a second-degree sexual assault charge and no other problems he may be encountering or may have encountered. He felt that was inappropriate and wanted to deal with total emotional difficulties as opposed to just a second-degree sexual assault charge."
Regarding this information, the court stated:
"You are not the person to judge the validity of a program that an expert in the field is putting you through directed toward your rehabilitation. And the fact that you will second guess these people rather than cooperate and accept has a very definite bearing on your ability to be appropriately rehabilitated."
The judge could properly base the increased sentence partially on this factor. The information demonstrated that the defendant was not cooperating with counseling efforts, and was therefore a poor candidate for rehabilitation.
A final reason justifying the longer sentence was the amplified knowledge of the crime gleaned from the trial by the judge. He stated at the resentencing:
"Now, I have heard the evidence for the first time, I have seen the victim. I have heard the witnesses. It's a lot different than a cold report that I get from the District Attorney or from what's embodied in the presentence report."
Other courts have held that Pearce allows an increased sentence based on enhanced knowledge obtained from trial of the defendant's criminal activity. United States v. Kienlen, 415 F.2d 557 (10th Cir. 1969); State v. Taylor, 22 Wash. App. 308, 589 P.2d 1250 (1979); United States v. Cunningham, 529 F.2d 884 (6th Cir. 1976). The Sixth Circuit in Cunningham noted:
*704 "Another factor which we see as almost inevitably influencing the decision of a trial judge is that in a plea of guilty, the crime pleaded is understood only as related in somewhat sterile fashion through the plea taking process or through a printed narration in the presentence report. The sentencing following a trial upon the merits, on the other hand, sees the trial judge in possession not only of more of the detailed facts of the offense itself, but of the flavor of the event and the impact upon any victims. It is for that reason a more real and accurate appraisal of the circumstances which brought the defendant to the bar of justice, and almost inevitably this added knowledge will affect the judge's consideration of what penalty appears most appropriate. This can, of course, work to the benefit or the detriment of the defendant according to the degree of culpability shown by the proofs." Id. at 889.
The court of appeals, relying on United States v. Tucker, 581 F.2d 602 (7th Cir. 1978), rejected this distinction between live testimony and a cold report as justification for a harsher sentence. Tucker is distinguishable on the basis that in that case the increased sentence was based on additional knowledge obtained at a second trial, and not from an initial trial after a vacated plea. We find this distinction significant. In a retrial situation, the judge has already been afforded a full-scale trial on the facts. The same is not true at a first trial subsequent to a withdrawn plea. United States v. Cunningham, 529 F.2d at 888-89.
[2]
In summary, we conclude that the defendant's increased sentence on the sexual assault charge was properly based on three objective factors. First, leniency in sentencing extended pursuant to a plea agreement need not carry over to sentencing after trial. Second, the record demonstrated the defendant's reduced chances for rehabilitation. Finally, the judge enhanced his knowledge of the circumstances surrounding the crime at trial.
*705 As for the original ten year burglary sentence, the defendant contends that the court of appeals erred by only applying the prophylactic rules of Pearce and Denny to the sexual assault sentence and not to the burglary sentence. The court of appeals held that since the burglary sentence was an original one, the protections of Pearce and Denny do not apply.[3] The defendant asserts that since the burglary arose out of the same course of conduct as the sexual assault, the protections of Pearce and Denny are applicable. Defendant finds support for his argument in 3 ABA Standards for Criminal Justice, Sentencing Alternatives and Procedures Standard 18-4.9 at 18.323 (1980), relating to resentencing, which provides as follows:
"(a) Except as authorized in paragraph (b), the new sentence imposed at a resentencing should not be more severe than the original sentence less time already served. Because the appearance of justice is maximized by imposing such a ceiling, this limitation should be observed regardless of whether
". . .
"(ii) the offense involved is the same offense or a different offense based on the same conduct . . . ." (Emphasis added.)
It is impossible to apply the rule of Pearce-Denny to the burglary conviction since there never was a previous sentence imposed for the burglary. In fact, pursuant to the original plea bargain agreement, the burglary charge was dismissed. Literally, Pearce refers only to the resentencing setting and the relevancy of new objective information learned by the judge since the first sentence was imposed. Pearce cannot be applied because there are no new factors to consider at an original sentencing. *706 While such reasoning may initially appear unreasonably formalistic, combined sentences are not to be viewed as package deals. Each sentence is for a separate and distinct criminal offense.
[3]
Nonetheless, we recognize that judicial vindictiveness could easily be concealed by handing down a heavy or maximum sentence on the reinstated charge (burglary), while leaving the original sentence of the related offense (sexual assault) intact. This is possible irrespective of whether the charges are related to a single episode of criminal conduct. In order to eliminate the vindictiveness concerns of Pearce-Denny, the judge must therefore state on the record: (1) new objective information learned since sentencing the defendant on the other charges, related or not, and, (2) give sufficient reasons for the length of the original sentence imposed for the reinstated charge as required by McCleary. The fulfillment of these requirements will act as a guide on a judge's sentencing discretion.
In this case, the new objective factors considered for increasing the sexual assault sentence are equally relevant to the burglary sentence. We recognize that although these factors are not new as they relate to the burglary charge, they are persuasive evidence of the lack of vindictiveness in the burglary sentence.
In addition to these objective factors, the judge also properly considered the severe nature of the burglary. When imposing the sentence, the judge remarked:
"I think that the two incidents, the two crimes are distinct in their nature in that there was not only a violation of the victim's property rights and invasion of her home, there was also a separate invasion of her body. This is not the case where the victim might have been walking down the street in a certain neighborhood or part of town and have been sexually assaulted. This is a case where the victim is now in a situation where it *707 took place in her own home and it was a grievous invasion of her right to privacy."
This statement is devoid of vindictiveness and accurately portrays the judge's reasoning for the ten year sentence. This defendant lived in the same residence complex as the victim. He obviously, with his demonstrated modus operandi, deliberately chose to attack her in the privacy of her living quarters. She will now no longer feel completely secure in her own home. The law respects the sanctity of a person's dwelling. No longer will this victim be able to relax and feel secure in the one area where all citizens should be able to feel safe, that is, in her home. She has been attacked in that "safe" area and will always have doubts concerning her security. This was not a burglary resulting in the loss of physical property, but a burglary perpetrated to violate a person's physical security. The sentence for burglary carried no indication of vindictiveness but was rather the judge's attitude that society needs the greatest protection from acts of this nature.
Even where a trial judge states new objective factors on the record when resentencing a defendant, the possibility of an abuse of discretion still exists if the record itself demonstrates vindictiveness. This court has examined the resentencing transcript. We admit that some of the judge's words, taken out of context, could arguably support allegations of vindictiveness. However, taken as a whole, we find no actual vindictiveness present in the record.
[4]
Since we find that the increased sentence for sexual assault and original sentence for burglary were based on objective information that was proper to consider at a resentencing following a vacated plea agreement and no evidence in the record to demonstrate actual vindictiveness, we hold that the defendant's increased ten year *708 sentence for sexual assault and the original ten year sentence for burglary do not violate Pearce and Denny.
By the Court. The decision of the court of appeals is reversed in part and affirmed in part.
SHIRLEY S. ABRAHAMSON, J. (dissenting).
The point of applying the Pearce-Denny due process doctrine in this case is to assure the public and the defendant that the defendant is subjected to punishment for the crime the state has proved, not for the "offense" of withdrawing a guilty plea. The withdrawal of the plea cannot at one and the same time be granted by the court and penalized by the court.
To ensure that the defendant is punished only for the crime committed rather than the defendant's choice to exercise his or her legal rights, the United States Supreme Court has looked skeptically at harsher sentences imposed after the defendant has exercised those rights. The United States Supreme Court is not concerned with looking for a particular subjective intent on the part of a particular judge when the punishment is increased at the second sentencing; the Court has recognized that such motive would be extremely difficult to prove. The Supreme Court has instead adopted a prophylactic rule in North Carolina v. Pearce, 395 U.S. 711, 725, note 20 (1969), to guard against the possibility that a particular judge might act on "vindictive" reasons in resentencing a defendant. The Pearce rule protects against the institutional hazard that a judge subconsciously might be motivated to respond in a retaliatory manner to a defendant's fruitless exercise of his right to obtain a retrial of a decided question. North Carolina v. Pearce, supra, 395 U.S. at 725; Colten v. Kentucky, 407 U.S. 104, 113, 114 (1972); Chaffin v. Stynchcombe, 412 U.S. 17, 18 (1973).
To guard against this hazard which is inherent in the resentencing process, the Court requires the trial court to *709 state, on the record, its reasons for imposing a harsher sentence. These reasons must meet several criteria: (1) they must be based on objective information; (2) they must concern identifiable conduct; (3) that conduct must be on the part of the defendant; (4) that conduct must occur after the time of the original sentencing proceeding. (Like the majority, I recognize that this fourth factor is ambiguous in light of other language in the Pearce opinion.)
The United States Supreme Court has set forth a difficult test which the trial court must pass on the record it creates. I write separately because I disagree with the majority's conclusion that the three reasons for increasing this defendant's sentence which the majority reads into the circuit court's statements at sentencing satisfy the Pearce-Denny criteria. I am persuaded that the factors "leniency" and "amplified knowledge of the defendant's criminal activity" as used in the majority opinion do not concern objective information, stated in the record, of defendant's identifiable conduct. These factors do not involve the defendant's acts, and these factors, as defined in the majority opinion, will be present in any case in which a defendant chooses to exercise his or her right to withdraw a guilty plea and go to trial.
The majority reads "leniency" into the record based on its understanding of the inherent nature of plea bargaining, but the record reveals that at the first sentencing the circuit court did not mention "leniency," and "leniency" does not appear to have been a concern at that hearing. The only possible "leniency" that the record reveals is the circuit court's reservations about the defendant's guilt because the circuit court believed the defendant may have had a defense. The two trials after the defendant's withdrawal of the plea revealed to the circuit court what the defendant had already told him by pleading guilty: that the defendant was, in fact, guilty. On resentencing it is clear that the circuit court believed *710 it had erroneously given the defendant the benefit of a doubt as to guilt in the original sentencing and at the resentencing the circuit court sought to take away that benefit.
Neither the "leniency" nor the "amplified knowledge of the defendant's criminal activity" involves any facts not previously known by the judge. The trials proved, as had the hearing on the guilty plea, that the defendant had committed the crime. The facts of the crime were set forth in the complaint and in the transcript of the preliminary hearing at which the victim had testified; the transcript was available to the circuit court at the first sentencing. The only "fact" that changed between the first and the second sentencing was the circuit court's perception of those facts. At the second sentencing, the circuit court attempted to rectify its previous mistake. However, as both parties agreed on oral argument, to allow the circuit court to increase a sentence on resentencing because it had had a mistaken perception of the offense or offender at the first sentencing violates due process under Pearce and Denny because a change of mind by the court is not objective "new" information of the defendant's identifiable conduct.
The court of appeals carefully compares in its opinion the facts the circuit court knew and considered on sentencing and resentencing and carefully explains that the resentencing was based on the circuit court's changed perception of the offender and offense. I am persuaded by the court of appeals' analysis that the record does not reveal that the circuit court affirmatively stated reasons for imposing a harsher second sentence on the sexual assault conviction based on its considering objective "new" information of the defendant's identifiable conduct. Instead of paraphrasing the opinion of the court of appeals, I set forth the relevant parts as follows:
"We conclude that the increased sentence for sexual assault deprived defendant due process because it was not *711 based on objective facts unknown to the trial court at the time of the first sentence. . . .
"As a factual basis for the plea bargain, the prosecutor told the court that about 3:00 a.m., September 11, 1978, the victim was asleep in her apartment when she was awakened by the defendant choking her. He was lying on her and was nude. Defendant told her that he wanted to have sex with her and pushed a fork against her neck. He threatened to hit her with his fist but put down the fork and grabbed a picture which he put against her neck. He told her he entered her second-floor apartment by climbing up to the balcony to a patio outside her apartment. He was in the apartment about forty-five minutes before the victim could put him out.
"The trial court adjudged defendant guilty of assault and committed him for a medical evaluation. At the sentencing the judge said he had examined the reports submitted by the doctors and the Department of Health and Social Services. The judge said defendant had a very substantial prior criminal record, that he had had opportunities for rehabilitation and that the case was `extreme,' a word the judge said he could not over-emphasize because of the risk to the victim. Stating that defendant's behavior was about as anti-social as it could be, the court sentenced him to six years' incarceration, less credit for time in the county jail.
"The trial court subsequently permitted defendant to withdraw his plea. The court vacated the conviction and sentence, and reinstated the burglary charge. Both charges were tried to a jury. The first trial resulted in a guilty verdict on the burglary charge but the jury could not agree on the sexual assault charge. Defendant was convicted of second-degree sexual assault in a second trial.
"The victim testified at each trial that she awoke in her apartment with defendant choking her and with a fork to her neck. He was naked and on top of her and demanded sexual intercourse. He unsuccessfully attempted vaginal and anal penetration and fondled her and demanded that she fondle him. During the struggle, he dropped the fork and picked up a picture with a glass front, which he broke, and pressed the picture to her neck. When she insisted on going to the bathroom, he went with her, grabbing her hair and continuing to fondle *712 her. She grabbed his hair but released him when he released her. Defendant then dressed and left the apartment. The victim had locked her front door. Defendant said he came up through her patio door. An investigating officer testified that shortly after the incident the victim was in semi-shock and had neck wounds consisting of three punctures and four scratches but no bleeding.
". . . .
"The trial court sentenced defendant to concurrent terms of ten years on the burglary and sexual assault charges, less credit for time previously served. The judge said that when imposing the original six-year sentence, he took into account that a plea bargain had been entered, that defendant was an excellent subject for rehabilitation, and that defendant was remorseful. The judge said that when sentencing on a plea bargain, he has reservations as to the guilt of a defendant, but that during the trial he became aware of the victim's complete innocence and the strength of the state's case. He believed that defendant had feigned remorse. One basis for that belief was that defendant obtained a new trial on his claim of intoxication at the time of the offenses but offered no evidence of intoxication at trial. The other basis for the judge's belief was defendant's unwillingness to accept the overwhelming evidence of his guilt. The judge was convinced on the basis of the presentence report that defendant was not a good subject for rehabilitation.
". . . .
"When imposing the ten-year sentence for sexual assault, the judge had before him essentially the same objective information in the presentence report as he had when sentencing defendant to six years. The report contained additional objective facts which are irrelevant to our inquiry. Those facts consisted of procedural history, defendant's employment record before his no contest plea, and an innocuous prison record. The judge did not state that he relied on any of those facts when imposing the longer sentence. He did not include those facts among his reasons for the harsher sentence, as he must under Pearce and Denny if the sentence is to be sustained.
"The statements in the presentence report regarding defendant's being a threat to the community, his rehabilitation *713 potential and the recommendation that he be sentenced for an appropriate period are new and objective in the sense that they involve the reported subjective reactions of another person. Those reactions, however, do not differ markedly from those strongly expressed by the judge himself at the first sentencing, and are therefore irrelevant to the Pearce and Denny standards.
"As the judge noted, he could not fault defendant for his counsel's trial tactic of not pursuing the intoxication defense. Rather, the judge concluded that raising that defense impeached defendant's previous claim to remorse for what he had done. The judge's belief that defendant may have feigned remorse when first sentenced and was not remorseful at the second sentencing is not an objective fact.
"The facts related by the prosecutor to the court regarding the assault as a basis for the plea bargain were substantially the same as the facts to which the victim testified. The important difference lies not in the facts themselves but in the reaction of the judge to how they were presented. As the judge put it, hearing the witnesses and seeing the victim is different from hearing the prosecutor's `cold report' and reading the presentence report.
"The state urges that the difference between live testimony and cold reports relating to the same facts justifies a longer sentence. The state asserts that we should adopt the view expressed in United States v. Kienlen, 415 F.2d 557 (10th Cir. 1969). Kienlen held that a harsher sentence following a new trial may meet the Pearce standard where the trial judge has heard the facts from a witness and a deposition rather than obtaining them from `a cold pre-sentence report.' 415 F.2d at 559-60. But United States v. Tucker, 581 F.2d 602, 607 n. 10 (7th Cir. 1978), when vacating a harsher sentence, rejected Kienlen for having failed `strictly to follow' the Pearce requirement for objective information or identifiable conduct by the defendant after the first sentence.
"We agree with Tucker's rejection of the distinction between live testimony and a cold report as justification for a harsher sentence. Judicial retaliation could be masked if the trial court's subjective reaction to the same evidence were allowed to justify a harsher sentence. *714 Because due process `requires that a defendant be freed of apprehension of such a retaliatory motivation on the part of the sentencing judge,' Pearce, 395 U.S. at 725, the potential for vindictiveness must be prevented.
"The state suggests that because defendant withdrew his original plea of guilty and went to trial, leniency based on his plea of guilty was inappropriate at the resentencing, and that the trial court simply sentenced him without extending that leniency. The state quotes from Corbitt v. New Jersey, 439 U.S. 212, 223 (1978), to the effect that `it is constitutionally permissible to take [a guilty plea] into account. . . . [I]t is not forbidden to extend a proper degree of leniency in return for guilty pleas.' The record does not show that the trial court granted leniency to defendant in return for his guilty plea.
"We conclude no showing was made of objective facts first brought to the attention of the trial judge when he imposed the second sentence for sexual assault. The longer sentence for sexual assault therefore does not meet the Pearce and Denny standards. The ten-year sentence must be reduced to the original sentence of six years. Denny, 47 Wis. 2d at 547, 178 N.W.2d at 42."
The circuit court's own words most clearly reveal its frustration with its previous sentencing and its attempt to rectify at resentencing what the court perceives as its own error:
"There were three principal considerations, at least on my part, when you were sentenced the first time. The first was it came before me on a plea agreement. . . .
"The second was that I was quite impressed that you were penitent and remorseful at that time and the third was that I was satisfied you were an excellent subject for rehabilitation. And I don't believe in the validity of any one of those three premises at this time . . .
". . . .
"I gave you the most lenient sentence that I thought I possibly could justify under the pre-sentence report and giving you also what I considered to be the benefit of the doubt as to your guilt because whenever a District Attorney comes before me and say `we are entering into a plea agreement and we are not making a statement and we *715 are dismissing a charge', despite whatever else is said, I always have some mental reservations regarding the guilt, real guilt of the defendant. I wonder if there wasn't some latent defect in the State's proof or some other problem that presents a hazard to the State in obtaining a conviction to such an extent that they are willing to make a compromise in a serious case like this so that you get the benefit of that consideration from the Court at the time of the original sentence.
"Now, I have heard the evidence for the first time, I have seen the victim. I have heard the witnesses. It's a lot different than a cold report that I get from the District Attorney or from what's embodied in the presentence report.
"And I'm convinced, despite the fact there was a hung jury on the one count the first trial, which in view of the well, I won't characterize it the way I feel about it, but I felt that the evidence of your guilt is overwhelming in this case, absolutely overwhelming. And consequently, I feel that that's an altogether different matter to be brought to the Court's attention at this time where I didn't hear the testimony and didn't hear the evidence in the first place.
"And it puts the case in an altogether different light from a sentencing standpoint, despite the fact that there was an admission on your plea the first time. The Court simply didn't have the detail into the complete innocence of the victim. I certainly didn't have the knowledge of the strength of the State's case and I'll have to admit I gave you the benefit of mental reservations concerning the State's case, the potential for possible acquittal and also, of course, the interest of protecting the victim.
"So from a guilt phase standpoint in this case, where we have a plea agreement abandoned and then a trial as contrasted with the kind of information I would have had had we tried the case the first time, I get an altogether different blush or view of your guilt than I had at the time of the plea agreement." (Emphasis added.)
For the reasons set forth herein and by the court of appeals, I would affirm the decision of the court of appeals.
I am authorized to state that Justice Nathan S. Heffernan joins in this dissent.
NOTES
[1] In Colten v. Kentucky, 407 U.S. 104 (1972), the court held that the Pearce rule does not apply to harsher sentences imposed after a trial de novo in states having a two-tier trial court system. The court noted that the possibility of vindictiveness was not inherent in Kentucky's two-tier system since the second sentence was imposed by a different court that was not asked to correct itself. Id. at 117. In Chaffin v. Stynchcombe, 412 U.S. 17 (1973), the court held that the Pearce resentencing restraints are inapplicable when the second sentence is imposed on retrial by a jury. The court found the likelihood of vindictiveness de minimis when resentencing was performed by a jury since the jury had no motive to engage in self-vindication, had no knowledge of the prior sentence, and was unlikely to be sensitive to institutional interests that may cause more severe resentences by a judge desirous of discouraging what he regards as meritless appeals. Id. at 26-27.
[2] Since this factor of leniency does not concern any new information concerning the defendant's conduct, technically speaking it is not a factor as contemplated by the Pearce and Denny decisions. Nonetheless, a statement in the record regarding this consideration negates the possibility of judicial vindictiveness, which is the paramount concern of Pearce and Denny.
[3] There is no issue in this case that the reissuance of the burglary charge was invalid due to prosecutorial vindictiveness. See Blackledge v. Perry, 417 U.S. 21 (1974), United States v. Anderson, 514 F.2d 583 (7th Cir. 1975). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582458/ | 329 N.W.2d 324 (1983)
Kit HYMANSON and Lucky Lanes, Inc., Appellants,
v.
CITY OF ST. PAUL, et al., Respondents.
No. 82-1459.
Supreme Court of Minnesota.
January 24, 1983.
*325 Dorfman & Hauge, Leo Dorfman and Alan Dorfman, Minneapolis, for appellants.
Edward P. Starr, City Atty., and Jane A. McPeak, Asst. City Atty., St. Paul, for respondents.
Considered and decided by the court en banc without oral argument.
*326 PETERSON, Justice.
By a resolution dated August 19, 1982, the St. Paul City Council unanimously revoked various liquor and entertainment licenses held by Lucky Lanes, Inc. (The business run by Lucky Lanes, Inc. is more commonly known as "Pudge's.") Plaintiffs Lucky Lanes, Inc. and Kit Hymanson (the sole shareholder and president of Lucky Lanes, Inc.) sought a permanent injunction against revocation of the licenses in district court. The permanent injunction was denied. We affirm.
Issues raised on appeal include: (1) whether the notice and hearing requirements of the contested case provisions of Minn.Stat. §§ 14.57 to 14.70 (1982), Minnesota's Administrative Procedure Act (APA), were followed; and (2) whether the APA requires the appointment of a hearing examiner to conduct initial liquor license revocation proceedings. Our discussion is brief because division in the court centered only upon the hearing examiner issue.
Before a liquor license may be revoked in Minnesota, a licensee is entitled to a hearing pursuant to the sections of the APA mentioned above.[1] Minn.Stat. § 340.135 (1982). We are satisfied that notice and hearing requirements were amply met in this case. A notice of a public hearing before the city council was sent to plaintiffs on July 8, 1982. The notice described the ordinance violations (an after-hours display of alcohol, and indecent exposure by male dancers performing at Pudge's) for which revocation or suspension of licenses might occur. The notice also mentioned that complaints by neighborhood residents near Pudge's would be heard. The hearing held on August 10, 1982, was orderly. Council Member Victor Tedesco presided, aided on legal questions by a city attorney. After listening to testimony presented, both adverse and favorable to Pudge's, the city council unanimously voted to revoke plaintiffs' licenses.[2] We uphold the decision, as falling within the grant of broad discretion given to municipal authorities to determine the issuance, regulation, and revocation of liquor licenses. Sabes v. City of Minneapolis, 265 Minn. 166, 120 N.W.2d 871 (1963); cf. Wajda v. City of Minneapolis, 310 Minn. 339, 246 N.W.2d 455 (1976).
A closer question is whether a hearing examiner should have been appointed to conduct initial liquor license revocation proceedings. We emphasize the word initial to relate an important point about the role of hearing examiners: their functions are subordinate to a reviewing agency's (in this case, the city council's) power. A hearing examiner presides at meetings and makes recommendations for decision. But the agency is not bound by the findings and recommendations of the hearing examiner. K. Davis, Administrative Law Text, § 10.07 (3rd ed. 1972). In this sense, the relationship differs from that of an appellate court reviewing a lower court's findings of fact: *327 an agency could make new findings and decide contrary to the hearing examiner's recommendation. Id. at § 10.04. A hearing examiner takes no power away from an agency.
The historical background and function of hearing examiners aids in analysis of legislative intent involved in Minn.Stat. § 340.135 (1982).[3] Since 1975, contested case provisions of the APA have provided the procedural framework within which governing authorities may revoke or suspend liquor licenses. Section 340.135, however, never explicitly incorporated the sections of the APA pertaining to hearing examiners, and their functions and duties, Minn.Stat. §§ 14.48 to 14.56 (1982).[4] The Attorney General found this omission telling, and advised the Minneapolis City Attorney that no hearing examiner need be appointed to conduct hearings concerning revocation or suspension of an intoxicating liquor license. Op.Atty.Gen., 218g-14, Nov. 5, 1976. Municipalities in Minnesota have followed this guidance ever since. And although the Attorney General opinion is not controlling, we are persuaded that this opinion reflects the true legislative intent embodied in Minn.Stat. § 340.135.[5] Similarly, when the city council incorporated section 340.135 by reference in its ordinance, it may be presumed that it intended the construction that the Attorney General had advised in its opinion. This is manifested by the council's action in not appointing a hearing examiner. The statute, by incorporating the contested case procedures, brought notice and hearing requirements to an area noted for its irregularity of process. Many jurisdictions had no notice or hearing requirements, nor were these constitutionally required. See, Annot., 35 A.L.R. 2d 1067 (1954). Nor did Minnesota municipalities have procedures for liquor license revocations matching the finely detailed notice and hearing requirements of the APA. See, e.g., St. Paul, Minn. Legislative Code § 308.14 (1976); Duluth, Minn. Legislative Code § 8-68 (1959) (automatic revocation upon conviction of the licensee of a gross misdemeanor or felony). Imposition of contested case procedures on widely varying procedures usually applicable for liquor license revocations did bring uniformity and this, we believe, was its intended result.
To go one step further to say hearing examiners are necessary before a liquor license can be revoked in Minnesota cities statewide comports neither with past interpretation of section 340.135, nor with what we believe this section sought to attain, nor with the historical functions of hearing examiners. Our interpretation of legislative intent leads to the following holding: Minn.Stat. § 340.135 does not require the appointment of a hearing examiner to conduct initial liquor license revocation proceedings.[6]
Affirmed.
*328 AMDAHL, Chief Justice (concurring specially).
I vote with the majority on the issue of whether a hearing examiner should have been employed in the instant case but only because we have not heretofore considered the issue directly and the parties to the present action had only inferential notice that we might require an independent hearing examiner in liquor license hearing cases and thus proceeded reasonably into the hearing without employing such an examiner. For future cases, barring some unforeseen and unusual circumstances, I would support the view of the minority.
SCOTT, Justice (dissenting).
I respectfully dissent. I would reverse the decision of the trial court on the ground that a hearing and decision by an independent hearing examiner must precede the city's revocation of a liquor license.
Minn.Stat. § 340.135 (1982) states:
The authority issuing or approving any license or permit pursuant to the intoxicating liquor act may either suspend for not to exceed 60 days or revoke such license or permit upon a finding that the licensee or permit holder has failed to comply with any applicable statute, regulation or ordinance relating to intoxicating liquor. No suspension or revocation shall take effect until the licensee or permit holder has been afforded an opportunity for a hearing pursuant to sections 14.57 to 14.70.
(Emphasis added.) A hearing conducted in accordance with Minn.Stat. §§ 14.57 to 14.70 (1982) (contested case and review provisions of the Minnesota Administrative Procedure Act) contemplates the appointment of an impartial hearing examiner. Minn. Stat. § 14.58 assumes that an independent hearing examiner will be utilized when it states, in part:
Prior to assignment of a case to a hearing examiner as provided by sections 14.48 to 14.56 [legislation relating to the office of hearing examiner], all papers shall be filed with the agency. Subsequent to assignment of the case, the agency shall certify the official record to the office of administrative hearings, and thereafter, all papers shall be filed with that office. The office of administrative hearings shall maintain the official record which shall include subsequent filings, testimony and exhibits. All filings are deemed effective upon receipt. The record shall contain a written transcript of the hearing only if preparation of a transcript is requested by the agency, a party, or the chief hearing examiner. The agency or party requesting a transcript shall bear the cost of preparation. When the chief hearing examiner requests preparation of the transcript, the agency shall bear the cost of preparation. Upon issuance of the hearing examiner's report, the official record shall be certified to the agency.
(Emphasis added.) In addition, Minn.Stat. § 14.61 provides:
In all contested cases the decision of the officials of the agency who are to render the final decision shall not be made until the report of the hearing examiner as required by sections 14.48 to 14.56, has been made available to parties to the proceeding for at least ten days and an opportunity has been afforded to each party adversely affected to file exceptions and present argument to a majority of the officials who are to render the decision.
(Emphasis added.) Thus, when the Saint Paul Legislative Code was amended in 1980 to explicitly incorporate Minn.Stat. § 340.135,[1] that statute in turn incorporated sections *329 of the Minnesota Administrative Procedure Act, which clearly contemplated the appointment of an impartial hearing examiner. The City of St. Paul's 1980 amendment evidences a clear legislative intent to have hearing examiners preside at liquor license suspension or revocation hearings.
The majority opinion relies upon a 1976 opinion of the Attorney General, Op.Atty. Gen., 218g-14, Nov. 5, 1976, as the basis for its contention that past interpretation of § 340.135 did not indicate that an impartial hearing before an independent hearing examiner was necessary prior to revocation of a liquor license. The Attorney General's opinion incorrectly interprets § 340.135 for two reasons. First, it wrongly contends that the Minnesota legislature could not have intended that § 340.135 require a hearing examiner at liquor license revocation proceedings because when § 340.135 was amended in 1975 to incorporate the contested case sections of the Administrative Procedure Act the office of administrative hearings had not been created. In fact, the office of administrative hearings was created by legislative act just two days after the amendment of § 340.135.[2] The legislature must have known that hearing examiners would be required in contested cases under the APA.
Second, Minn.Stat. § 645.31, subd. 2 (1982), requires that § 340.135 also adopt by reference any subsequent amendments to laws which it has incorporated. In addition, as mentioned above, the St. Paul Legislative Code was amended in 1980 to incorporate § 340.135. At that time a hearing examiner was clearly required in contested cases under the APA.
The majority also contends that imposition of APA contested case procedures, rather than the widely varying procedures formerly undertaken by municipalities, brought uniformity to liquor license proceedings. To the contrary, by ignoring the hearing examiner requirement within the APA contested case procedures, the majority opens Pandora's box. How are we to know which of the provisions of §§ 14.57 to 14.70 are to be followed and which are not? Clearly § 14.61 is not. Are there other sections which may also be ignored?
An impartial hearing examiner is necessary in order to insure a fair hearing. A proceeding characterized by bitter neighborhood complaints, a possibly less than neutral city council, and a presiding council member who is not well-acquainted with evidentiary rules all facets of the present license revocation proceeding hardly seems impartial. Procedural fairness in the decision-making process was not possible in this case without separating the decision-making functions from those of investigation and advocacy. Thus, in order to insure fairness to the appellants and compliance with legislative directive, I believe an impartial hearing examiner should have been appointed to preside over the revocation hearing.
TODD, Justice.
I join in the dissent of Justice Scott.
YETKA, Justice.
I join in the dissent of Justice Scott.
NOTES
[1] The notice and hearing requirements outlined by the APA rise above those constitutionally mandated. Under Minnesota law, there is no property right in a liquor license. Country Liquors, Inc. v. City Council of Minneapolis, 264 N.W.2d 821, 826 (Minn.1978), quoting Arens v. Village of Rogers, 240 Minn. 386, 401, 61 N.W.2d 508, 519, appeal dismissed, 347 U.S. 949, 74 S. Ct. 680, 98 L. Ed. 1096 (1954): "[N]o person has a vested property right to engage in or continue to engage in the liquor business."
[2] After extensive evidence was introduced, plaintiffs stipulated to the two aforementioned ordinance violations. The city council also found that the activities of the licensee also created a serious danger to public health, safety, and welfare. This constitutes an additional ground for adverse action against a licensee in St. Paul. St. Paul, Minn. Legislative Code § 310.06, subd. 2(7) (1981). Plaintiffs alleged that notice was inadequate to inform them of this possible ground for revocation. While the written notice was not as specific as it could have been, we are convinced that plaintiffs had actual notice both by previous meetings with neighborhood residents, the license inspector, city council members, and the mayor that Pudge's business was creating serious problems in the surrounding neighborhood. The possibility that the licenses would be revoked for this reason was discussed at the public hearing. Under these circumstances, we have no difficulty upholding the city council's decision against arguments that the decision was based on inadequate notice and was arbitrary and capricious. See, Sabes v. City of Minneapolis, 265 Minn. 166, 120 N.W.2d 871 (1963).
[3] Minn.Stat. § 340.135 (1982), provides:
The authority issuing or approving any license or permit pursuant to the intoxicating liquor act may either suspend for not to exceed 60 days or revoke such license or permit upon a finding that the licensee or permit holder has failed to comply with any applicable statute, regulation or ordinance relating to intoxicating liquor. No suspension or revocation shall take effect until the licensee or permit holder has been afforded an opportunity for a hearing pursuant to sections 14.57 to 14.70.
(Emphasis supplied.)
[4] As the dissent correctly notes, certain provisions of the contested case procedure do refer to these sections, but our further discussion demonstrates why we do not think these references are dispositive of the issue.
[5] Corroborative of this analysis is the fact that the legislature has never amended Minn.Stat. § 340.135 to specifically mandate use of hearing examiners despite a suggestion in a dissent in Flame Bar, Inc. v. City of Minneapolis, 295 N.W.2d 586 (Minn.1980) (Justices Yetka and Scott, dissenting) that hearing examiners be appointed. The majority opinion rested upon a jurisdictional ground, and never reached the hearing examiner issue. The legislative inaction in the face of some confusion is indicative, we believe, of a position favoring the nonappointment of hearing examiners.
[6] Even if we were inclined to read such a requirement into Minn.Stat. § 340.135, the facts of the case suggest a waiver of the right to have initial proceedings before a hearing examiner. Plaintiffs, assisted by counsel, had more than a month's notice of the meeting with the city council. Yet they never made a request to have a hearing examiner appointed. Rather, they chose to meet directly and to negotiate with the city council. Only when their efforts failed with the city council did the hearing examiner issue arise.
[1] St. Paul, Minnesota, City Charter and Legislative Code § 310.05(7) (1981) provides:
Where the provisions of any statute or ordinance require additional notice or hearing procedures, such provisions shall be complied with and shall supersede inconsistent provisions of these chapters. This shall include, without limitation by reason of this specific reference, Minnesota Statutes, Chapter 364, and Minnesota Statutes, Section 340.135.
[2] Section 340.135 was amended by Act of June 2, 1975, ch. 231, 1975 Minn.Laws 672. The office of hearing examiners was created by Act of June 4, 1975, ch. 380, § 16, 1975 Minn.Laws 1285, 1293. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645138/ | 40 So. 3d 916 (2010)
Jiten SHETH, Appellant,
v.
C.C. ALTAMONTE JOINT VENTURE, Appellee.
No. 5D08-457.
District Court of Appeal of Florida, Fifth District.
July 30, 2010.
Jiten Sheth, Sanford, pro se.
Robert W. Thielhelm, Jr., Brian C. Blair and Krista A. Sivick, of Baker & Hostetler LLP, Orlando, for Appellee.
PER CURIAM.
Dr. Jiten Sheth, appearing pro se, appeals a final judgment awarding attorneys' fees and costs in favor of C.C. Altamonte Joint Venture, ("AJV"), following its success in underlying litigation regarding Dr. Sheth's tenancy in a building owned by AJV. Dr. Sheth was liable for the fees and costs pursuant to a guarantee agreement that he signed, in which he agreed to reimburse AJV for expenses it incurred "in endeavoring to collect or enforce the. . . [underlying lease and] guarantee[.]" The trial court found that ATV's attorneys reasonably expended 228 hours in its enforcement efforts. Although Dr. Sheth vigorously disputes this finding, it is supported by competent and substantial evidence. Accordingly, the finding cannot be disturbed on appeal. E.g., Bill's Equipment and Rentals v. Teel, 498 So. 2d 536 (Fla. 1st DCA 1986). The trial court found $251.00 to be a reasonable blended hourly rate for the matter, and this finding is also supported by competent and substantial evidence. Multiplying the rate times the hours yields a fee amount of $57,228.00. Adding the awarded cost amount of $2,822.30 should yield a judgment in the amount of $60,050.30. However, the judgment awarded fees and costs totaling $70,980.30, which is inconsistent with the court's time, fee and cost findings. Accordingly, we affirm the trial court's findings but reverse the judgment. On remand, the trial court is directed to enter a corrected judgment in the amount of $60,050.30, plus post-judgment interest at the statutory rate.
AFFIRMED IN PART; REVERSED AND REMANDED WITH DIRECTIONS.
MONACO, C.J., LAWSON, J., and EDWARDS-STEPHENS, S., Associate Judge, concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515815/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
FRED LUSTIG, UNPUBLISHED
March 12, 2020
Plaintiff-Appellee,
v No. 346447
Ingham County Circuit Court
DEPARTMENT OF HEALTH AND HUMAN LC No. 17-000794-AA
SERVICES, and MICHIGAN CIVIL SERVICE
COMMISSION,
Defendants-Appellants.
Before: CAMERON, P.J., and SHAPIRO and LETICA, JJ.
PER CURIAM.
Defendants, the Department of Health and Human Services (DHHS) and the Michigan
Civil Service Commission (MCSC), appeal by leave granted1 the circuit court’s order reversing
the MCSC’s order upholding the DHHS’s dismissal of plaintiff, Fred Lustig, a DHHS employee.
We reverse the circuit court’s decision and reinstate the MCSC’s order upholding the hearing
officer’s determination that DHHS properly terminated plaintiff’s employment for just cause.
I. BACKGROUND
Plaintiff’s title at DHHS was an “Auditor Manager 13” in the Long Term Care Rate and
Reimbursement section and he had worked there since 1997. Plaintiff’s duties included reviewing
and approving approximately 40 to 80 audit plans from two auditors who reported to him and
completing audits on his own relating to long-term care providers in order to determine Medicaid-
eligibility and other funding issues.
Plaintiff’s first supervisor began to notice problems with his work performance sometime
in 2014. Plaintiff’s first and second supervisors issued a non-disciplinary “needs-improvement”
1
Lustig v Department of Health and Human Services, unpublished order of the Court of Appeals,
entered May 20, 2019 (Docket No. 346447).
-1-
ratings for May 2014 and 2015, which included a performance review plan from May through
August 2015, with ten work objectives plaintiff was required to meet. His second supervisor
assessed that plaintiff failed to meet seven of the ten performance objectives. Plaintiff was then
issued his first “interim service rating” for the “unsatisfactory” review he received of his prior
performance for the period of September to December 2015. This rating also included ten
performance objectives.
In October 2015, plaintiff’s second supervisor issued plaintiff a non-disciplinary
written/formal counseling regarding his errors in and the untimeliness of his work product. In
November 2015, plaintiff’s second supervisor issued plaintiff a disciplinary written reprimand
because he violated a work rule by failing to carry out instructions, work assignments, and was
otherwise derelict in the performance of his duties.
Plaintiff was again issued an interim service rating from December 2015 to March 2016
for failing to meet the ten previous performance objectives, and he was assigned 11 objectives for
the period. In February and March of 2016, plaintiff’s second supervisor issued written reprimands
to plaintiff for violation of the same work rule and noted many of the same inaccuracies and
untimeliness issues in plaintiff’s work performance.
At the conclusion of his second interim ratings period, plaintiff’s second supervisor issued
plaintiff his final performance rating on March 29, 2016. It identified many of the issues that had
been previously highlighted and described how plaintiff had failed to meet the performance
objectives placed on him during his ratings period. In other words, it specified in detail the
untimeliness of plaintiff’s work, the backlog of his assignments, and the errors that had passed
through his review. That same day, DHHS dismissed plaintiff.
Plaintiff filed a grievance with the MCSC, which assigned plaintiff a hearing officer.
Before the hearing, the hearing officer issued three orders requesting certain documents from
DHHS regarding plaintiff’s work assignments and the work assignments and objectives of other
employees. DHHS did not comply with all of these document requests, claiming that it no longer
had access to the documents because they did not exist or were destroyed in the normal course of
business prior to the action or because plaintiff had other means to obtain the information he
sought. The hearing officer agreed and, thereafter, rejected plaintiff’s arguments that the
allegations against him could not be proven absent that information. Thus, the hearing officer
upheld DHHS’s decision to terminate plaintiff.
Plaintiff then appealed to the Employment Relations Board, which issues recommended
decisions for the MCSC. The Board rejected plaintiff’s arguments and recommended that the
MCSC issue a final decision upholding plaintiff’s dismissal, which it did.
Plaintiff next appealed to the circuit court. The circuit court reversed the MCSC’s final
decision, determining that DHHS’s failure to produce the requested documents amounted to a
procedural due process violation as the MCSC had deprived plaintiff of the ability to present an
adequate defense.
This appeal follows.
-2-
II. ANALYSIS
Defendants first argue that the MCSC’s determination that the DHHS had just cause to
terminate plaintiff was supported by substantial evidence. Second, they argue that plaintiff’s due
process rights were not violated by DHHS’s failure to produce all of the requested documentation
because he had the opportunity to be heard and to defend himself by subpoenaing the testimony
of other employees to provide the information he sought. In response, plaintiff argues that he was
unable to present an adequate defense because he lacked requested documentation regarding his
work requirements and objectives in comparison to other similarly situated employees and thus he
was denied procedural due process. We agree with defendants.
A. STANDARD OF REVIEW AND LEGAL STANDARDS
The courts’ review of a final decision of the Civil Service Commission is governed by
Const 1963, art 6, § 28, Viculin v Dep’t of Civil Serv, 386 Mich. 375, 385; 192 NW2d 449 (1971),
which provides that:
All final decisions, findings, rulings and orders of any administrative officer or
agency existing under the constitution or by law, which are judicial or quasi-judicial
and affect private rights or licenses, shall be subject to direct review by the courts
as provided by law. This review shall include, as a minimum, the determination
whether such final decisions, findings, rulings and orders are authorized by law;
and, in cases in which a hearing is required, whether the same are supported by
competent, material and substantial evidence on the whole record[.]
“This language consists of two standards of review: ‘authorized by law,’ a minimum standard
applicable every time the constitutional provision applies, and ‘competent, material, and
substantial evidence on the whole record,’ applicable only in cases where a hearing is required.”
Henderson v Civil Serv Comm, 321 Mich. App. 25, 39; 913 NW2d 665 (2017). Thus, “when
reviewing a lower court’s review of agency action this Court must determine whether the lower
court applied correct legal principles and whether it misapprehended or grossly misapplied the
substantial evidence test to the agency’s factual findings. This latter standard is indistinguishable
from the clearly erroneous standard of review[.]” Boyd v Civil Serv Comm, 220 Mich. App. 226,
234-235; 559 NW2d 342 (1996). “[A] finding is clearly erroneous when, on review of the whole
record, this Court is left with the definite and firm conviction that a mistake has been made.” Id.
A decision is not authorized by law when: (1) it violates a statue or the Constitution; (2) it
exceeds statutory authority or the agency’s jurisdiction; (3) it is made upon unlawful procedures
that result in material prejudice; or (4) it is arbitrary and capricious. Wescott v Civil Serv Commn,
298 Mich. App. 158, 162; 825 NW22d 674 (2012). “This Court adopted this particular formulation
of the authorized-by-law standard, in part, because it focuses on the agency’s power and authority
to act rather than on the objective correctness of its decision.” Henderson, 321 Mich. App. at 44
(quotation marks omitted).
Under the substantial-evidence test, “it does not matter that the contrary position is
supported by more evidence, that is, which way the evidence preponderates, but only whether the
position adopted by the agency is supported by evidence from which legitimate and supportable
-3-
inferences were drawn.” McBride v Pontiac Sch Dist, 218 Mich. App. 113, 123; 553 NW2d 646
(1996). “The substantial evidence test requires that a decision be supported by evidence that a
reasonable person would accept as sufficient.” Cogan v Board of Osteopathic Medicine &
Surgery, 200 Mich. App. 467, 469-470; 505 NW2d 1 (1993).
Procedural due process imposes “constraints on governmental decisions which deprive
individuals of liberty or property interests within the meaning of the Due Process Clause of the
Fifth or Fourteenth Amendment[.]” York v Civil Serv Comm, 263 Mich. App. 694, 702; 689 NW2d
533 (2004). Due process “requires the opportunity to be heard at a meaningful time and in a
meaningful manner.” Id. (quotation marks omitted). This includes the ability to have “the chance
to know and to respond to the evidence against him[.]” Id. (quotation marks omitted). “Under
Michigan law, civil service employees are guaranteed continued employment absent just cause for
dismissal. This property interest is sufficient to merit due process protections.” Id. at 703. “The
Civil Service Commission is a constitutional body possessing plenary power and may determine,
consistent with due process, the procedures by which a State Civil Service employee may review
his grievance.” Viculin, 386 Mich. at 393.
“Once it is determined that due process applies, the question remains what process is due.”
Morrissey v Brewer, 408 U.S. 471, 481; 92 S. Ct. 2593; 33 L. Ed. 2d 484 (1972). “The very nature of
due process negates any concept of inflexible procedures universally applicable to every
imaginable situation.” Cafeteria and Restaurant Workers Union, Local 473, AFL-CIO v McElroy,
367 U.S. 886, 895; 81 S. Ct. 1743; 6 L. Ed. 2d 1230 (1961). Rather, due process “calls for such
procedural protections as the particular situation demands.” Morrissey, 408 U.S. at 481. “[W]here
governmental action seriously injures an individual, and the reasonableness of the action depends
on fact findings, the evidence used to prove the Government’s case must be disclosed to the
individual so that he has an opportunity to show that it is untrue.” Goldberg v Kelly, 397 U.S. 254,
270; 90 S. Ct. 1011; 25 L. Ed. 2d 287 (1970) (internal quotation marks and citation omitted).
“[C]onsideration of what procedures due process may require under any given set of circumstances
must begin with a determination of the precise nature of the government function involved as well
as of the private interest that has been affected by governmental action.” McElroy, 367 U.S. at 895.
According to the Civil Service Rules and Regulations, a state agency may discipline an
employee for “just cause,” which is defined as actions, not limited to: (1) failing to carry out duties
and obligations imposed by an agency, a work rule, or the law; (2) conduct “unbecoming a state
employee”; or (3) unsatisfactory performance or service. Civ Serv R 2-6.1(a) and (b). Agencies
are to “use corrective measures and progressive discipline[,]” but have the “discretion to impose
any penalty, up to and including dismissal, provided the penalty is not arbitrary and capricious.”
Civ Serv R 2-6.1(d). An employee who is disciplined is entitled to appeal that discipline to the
MCSC and argue it was imposed without just cause. Civ Serv R 8-2.2(c). In those cases, where
an employee is alleging that discipline lacked just cause, the MCSC places the burden of proof on
the appointing authority to “prove by a preponderance of the evidence that it had just cause to
discipline the grievant.” Civ Serv Reg 8.01(4)(H)(3)(a). If the appointing authority meets that
burden, “a hearing officer can only alter the discipline imposed if the grievant proves by a
preponderance of the evidence that the particular discipline imposed (1) violated a [MCSC] rule
or regulation, (2) violated an agency work rule, or (3) was arbitrary and capricious.” Civ Serv Reg
8.01(4)(H)(3)(b).
-4-
B. DISCUSSION
We first conclude that the circuit court erred in determining that plaintiff’s procedural due
process rights were violated by DHHS’s failure to produce the requested documentation regarding
his workload and other employees’ workloads. Defendants had procedural safeguards in place
that provided plaintiff with due process. Defendants provided plaintiff with the supporting
documentation for his disciplinary actions and gave him an opportunity to challenge the veracity
of that information and to examine and cross-examine that evidence during a hearing and an
appeal. The record overwhelmingly demonstrates that plaintiff was aware of the basis for DHHS’s
progressive discipline regarding his work performance and ultimate dismissal, and that he had
ample opportunity to confront and refute this evidence. Indeed, plaintiff admitted that the records
that DHHS produced were an accurate reflection of his work, and, therefore, production of
additional documents pertaining to plaintiff’s work and workload would not have impacted the
veracity of the documentation DHHS provided. Thus, plaintiff had a meaningful opportunity and
time to be heard as well as to examine and know the evidence against him. York, 263 Mich. App.
at 702. As this is all due process requires, the circuit court clearly erred when it imposed the
heightened requirement of mandating DHHS to produce all of the documentation that plaintiff had
requested, even those documents that the record demonstrates that, in part, DHHS did not have
access to. Id.; Boyd, 220 Mich. App. at 234-235.
Additionally, DHHS’s failure to produce documents relating to plaintiff’s coworkers did
not violate due process because, even absent such documents, plaintiff could present an adequate
defense. The agency determined, in part, that DHHS was not required to produce the documents
at issue because the information could be ascertained through other means. We find no reason to
disturb this finding. McBride, 218 Mich. App. at 123. There is no indication that plaintiff was not
permitted to subpoena any witness he wanted, including other auditor supervisors, to testify about
their workload or that his right to cross-examine on this issue was improperly limited. The Civil
Service Regulations provide a procedure for requesting and issuing such subpoenas and plaintiff
failed to fully utilize this procedure when mounting his defense. See Civ Serv Reg 8.01(4)(F).
Indeed, plaintiff elicited some evidence regarding his argument that his objectives were
disproportionate to others, and his argument was still rejected by the MCSC. Again, we have no
reason to disturb this factual finding. McBride, 218 Mich. App. at 123. Moreover, as the Board
and hearing officer’s decisions noted, plaintiff seems to misunderstand the difference between his
objectives and his work assignments. Thus, even if plaintiff was correct that the number of
objectives assigned to him during his review process were unreasonable, he did not refute the
evidence that his actual work assignments remained unchanged during the review process.
Plaintiff also had the ability to cross-examine his supervisor about how his supervisor’s workload
compared to plaintiff’s. Thus, the record and the MCSC’s rules and regulations belie plaintiff’s
contentions that he was not given the opportunity to present an adequate defense without receiving
all of the documentation that he had requested.
And, to the extent that it is at issue on appeal, we agree with the circuit court and the agency
that there is substantial evidence that DHHS demonstrated just cause for plaintiff’s termination by
a preponderance of the evidence. Even as the circuit court expressed concern that plaintiff was
not able to compare his workload to the workload of others similarly situated, which impacted his
ability to defend against DHHS’s allegations, it indicated that MCSC’s determination that just
cause had been demonstrated satisfied the substantial evidence test. We also conclude that the just
-5-
cause determination was supported by substantial evidence. In fact, DHHS provided
overwhelming evidence that plaintiff failed to perform his work tasks accurately and timely despite
having multiple opportunities to correct his deficiencies. Civ Serv R 2-6.1(a), (b), and (d). Indeed,
as the hearing officer noted, plaintiff admitted that the information DHHS had compiled about his
work performance was accurate. And the annual plans and performance objectives of other
employees is simply not relevant to the issue of plaintiff’s documented failure to meet the
objectives set for him. Stated otherwise, plaintiff’s performance as compared to the work
performance of others similarly situated does not shed light on the pertinent just-cause
determination of whether plaintiff met the requirements set for him. There was substantial
evidence that DHHS met its initial burden of demonstrating just cause, and thus, the MCSC
properly shifted the burden to plaintiff to demonstrate that it should alter DHHS’s discipline
against him. Cogan, 200 Mich. App. at 469-470.
Simply put, the record belies plaintiff’s contention that he was not afforded a fair
opportunity to present an adequate defense without receiving all of the documentation that he had
requested. Applying the wrong legal standards, the circuit court erred when it determined
plaintiff’s due process rights were violated and reversed the MCSC’s final decision, which was
not contrary to the law and was supported by substantial evidence. Accordingly, we reverse the
circuit court’s order and reinstate the MCSC’s decision upholding the hearing officer’s
determination that DHHS had just cause to terminate plaintiff’s employment.
Reversed.
/s/ Thomas C. Cameron
/s/ Douglas B. Shapiro
/s/ Anica Letica
-6- | 01-03-2023 | 03-13-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1582133/ | 469 F.Supp. 70 (1979)
Floyd WILLIAMS, et al., Plaintiffs,
v.
OWENS-ILLINOIS, INC., Defendant,
No. C-75-1197 RHS.
United States District Court, N. D. California.
January 8, 1979, as amended May 17, 1979.
Judgment, March 15, 1979, as amended May 17, 1979.
*71 George T. Withy, Allan C. Miller, Elaine Gertsler, Ginger Gould, Withy, Gould, Miller & Gertsler, Berkeley, Cal., for plaintiffs.
Marvin D. Morgenstein, Michael A. Kahn, Mary C. Castle, Steinhart, Goldberg, Feigenbaum & Ladar, San Francisco, Cal., for defendant.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
SCHNACKE, District Judge.
The Findings of Fact and Conclusions of Law herein are based upon the findings of the Court and, in those cases of unanimous agreement by the Jury, upon the Jury's verdict. As to matters not unanimously agreed to by the Jury, the Court has found the facts to be in accordance with the view of a majority of the jurors.
On or before January 19, 1979, the parties shall submit proposed forms of judgment, suggestions of the relief appropriate to the findings of fact relating to the class of female employees, memoranda relating to the back pay due plaintiff Alice Brice, and *72 any other matters properly to be brought to the attention of the Court. All of such matters will be heard at 9:30 a. m., on Friday, February 2, 1979.
THE CLASS OF BLACK EMPLOYEES
1. Defendant's Oakland Plant is located in Oakland, California, on the border of Alameda, California. It is within commuting distance of the California cities of Oakland, Hayward, Alameda, San Leandro, Fremont, Richmond, San Lorenzo, Union City and Berkeley. During the period January, 1971 through July 31, 1978 the following percentage of its employees were hired from those cities: Oakland 46.1%; Hayward 12.4%; Alameda 9.7%; San Leandro 8.6%; Fremont 4.0%; Richmond 3.13%; San Lorenzo3.1%; Union City 2.4%; Berkeley 1.8%; other cities 8.6%.
2. Of the persons hired in the period from March 7, 1971, through July 31, 1978, and still employed on July 31, 1978, 35% were Black, 41% were White, and 23% were non-Black minority; information on the remaining 1% was not available.
3. The work force statistics by race of all employees at the Oakland Plant for the following years was as follows:
1971: Minority 30.5%
Black 14.8%
Caucasian 69.5%
March 31, 1973: Minority 31%
Black 20%
Caucasian 69%
August 31, 1974: Minority 38.5%
Black 19%
Caucasian 61.5%
March 31, 1975: Minority 39%
Black 19%
Caucasian 61%
March 31, 1976: Minority 40%
Black 20%
Caucasian 60%
March 31, 1978: Minority 45%
Black 23%
Caucasian 55%
4. In the initial assignment of new hires, Owens-Illinois did not discriminate against Black employees. The evidence established that assignment of new employees was based upon job openings and qualifications of the employee without regard to the race of the employee.
5. With respect to all employees who were paid an hourly rate, which employees composed 90% of the work force of the Oakland plant, Black and non-Black employees were paid the amounts required to be paid to them pursuant to the collective bargaining agreements applicable to those jobs, and no Black employee was paid either less than the amount required to be paid pursuant to a collective bargaining agreement or less than a non-Black employee in a similar job.
6. With respect to salaried employees, Black employees were paid an amount equal to non-Black employees for similar work, and no Black employee was paid less than the amount established by a bona fide job evaluation system for the job performed.
7. The percentage of Black employees hired by the Oakland plant commencing March 7, 1971 when compared with the percentage of Black persons in the civilian work force for the cities from which it would be anticipated that employees for the Oakland plant would be hired, demonstrates that the Black percentage of persons hired was equal to or greater than the number of Black persons in the applicable civilian work force, so that no finding can be made that Owens-Illinois discriminated against Black persons in hiring from a comparison of the civilian work force statistics with the Oakland plant statistics.
8. Black employees were not placed in jobs within departments, or in special departments, because of their race. The placing of employees was based upon job vacancies in the departments and the qualifications of the employees seeking those vacancies, without regard to race.
9. When an employee was employed in a job covered by a collective bargaining *73 agreement, the promotion of that employee in hourly jobs was controlled by the system provided in the employee's collective bargaining agreement, and Owens-Illinois followed the procedure for promotion established by the collective bargaining agreements.
10. Promotion of employees, from hourly jobs to salaried jobs, and promotion of employees in the salaried jobs, was not made with regard to the employee's race, nor were Black employees as a class denied promotions because of their race.
11. The variance and regression analyses introduced into evidence by plaintiffs did not establish, or support a claim that Owens-Illinois discriminated against its employees in their pay on the basis of the race of the employee, or the sex of the employee.
12. Plaintiffs failed to prove that Owens-Illinois engaged in any policy, pattern, or practice of terminating Black employees because of their race.
13. Job vacancies in the hourly jobs at the Oakland plant have been filled without regard to the employee's race. Where a job vacancy was a promotion pursuant to a collective bargaining agreement, the job was filled pursuant to the terms of the collective bargaining agreement, without regard to the race of the applicant. Where the job was not a promotion within a department, but was an entry into the department, it was filled without regard to the race of the applicant.
14. Vacancies in salaried jobs at the Oakland plant were filled without regard to the race of the applicant.
15. Job vacancies in the Teamster, Warehouse, Corrugated and Mold Repair departments required that the vacancies be filled through hiring halls pursuant to collective bargaining agreements between Owens-Illinois and the unions which represented the employees within the departments. Entry into the Maintenance, Central Mold Shop, Machine Repair and Forming departments were through apprenticeship programs administered by the union which represented the employees in the department and Owens-Illinois. The use of the union hiring halls and the use of the apprenticeship programs did not discriminate against any Black employees because of their race.
16. There is no evidence that Black employees as a class were denied jobs for which there were vacancies since March 7, 1971.
17. Since March 7, 1971, the procedure for promotion of hourly employees and the pay of those employees has been covered by collective bargaining agreements between Owens-Illinois and the union representing the employees of the department. The requirements of the agreements for promotion and pay of union employees has been adhered to by Owens-Illinois at all times since March 7, 1971; and the effect and impact of the provisions of the collective bargaining agreements has not had any adverse impact or effect upon Black persons as a class and has not had the effect of denying any job or promotion or pay increase or any other term or condition of employment to any Black person because of his race.
18. Since March 7, 1971, there was no evidence that Black persons as a class were denied jobs for which there were vacancies in any department at the Oakland plant.
19. During the trial plaintiffs offered evidence of isolated acts or practices which had occurred prior to March 7, 1971 with respect to Black persons. There was no evidence that any of those acts or practices continued, or had any present effect or impact upon Black persons, subsequent to March 7, 1971.
20. Since March 7, 1971 Owens-Illinois has not engaged in any policy, pattern or practice in hiring employees at its Oakland plant which either discriminated against, or had any adverse impact or effect upon Black persons because of their race.
CONCLUSIONS OF LAW
1. This claim was brought pursuant to F.R.Civ.P., Rule 23(b)(2), by plaintiffs who sought to represent, and were certified to represent, a class of all Black employees *74 who were employed by Owens-Illinois at any time since March 7, 1971.
2. Since March 7, 1971, Owens-Illinois has not engaged in any pattern or practice which discriminated against its Black employees as a class in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
3. Such class of employees are not entitled to relief, injunctive or otherwise.
CLASS OF FEMALE EMPLOYEES
1. Since March 23, 1974 the Owens-Illinois Oakland plant has at all times employed between 1600 and 2000 employees in approximately 21 departments. Between 30% and 35% of the work force during this period of time have been female employees.
2. Since March 23, 1974 approximately 70% of the job vacancies at the Oakland plant have been in three job classifications: lehr attendant, carton assembler, and selector.
3. The job of selector requires the employee to inspect bottles which are moving along an assembly line and to pack them into cartons for delivery. The selector must check the quality of bottles and discard the defective ones. The job requires a small amount of manual dexterity but generally can be accomplished by anyone.
4. The job of carton assembler requires the employee to take flat pre-stamped pieces of corrugated cardboard and assemble them into cartons and place the separators inside of them. This job requires some small degree of manual dexterity and may require a degree of strength as occasionally cardboard blanks in bundles must be lifted; however, basically anyone can perform this job.
5. The job of lehr attendant requires the employee to remove cartons filled with bottles of various sizes from a rapidly moving conveyor and place them on trailers and pallets at the rate of between 10 and 30 boxes a minute. This job requires little manual dexterity, however, it is extremely physically demanding and exhausting and requires a great deal of endurance and physical strength.
6. At all times since March 23, 1974 the pay of lehr attendants, selectors, and carton assemblers have been set forth and required by collective bargaining agreements between Owens-Illinois and the Glass Bottle Blowers Association Union.
7. Since March 23, 1974 very few women have filled the lehr attendant job.
8. Since March 23, 1974 most of the carton assemblers and selectors have been women.
9. Since March 23, 1974 almost all selector job vacancies have been filled from outside Owens-Illinois. Applicants for this job were received from the Department of Human Resources Development, screened in the company personnel office, and sent to the selecting foreman for ultimate hiring or rejection. Most persons sent by the Department of Human Resources Development were ultimately hired.
10. Since March 23, 1974 carton assembler and lehr attendant job vacancies have been filled from outside of Owens-Illinois by the above described procedure and by job postings. The job posting is a procedure whereby a notice of the job opening is posted throughout the plant, union employees sign the job posting, and the job is filled on the basis of seniority. Since the job of lehr attendant continually has vacancies in it, a permanent lehr attendant job posting was kept in the personnel office. All persons signing a job posting for lehr attendant or carton assembler had priority over any non-Owens-Illinois employee for these jobs.
11. Since March 23, 1974 very few women signed job postings or otherwise applied for lehr attendant jobs despite the fact that the job postings on their face stated "females are encouraged to apply." Women who did sign up for the job of lehr attendant and were the most senior on the list were awarded the job with rare exception.
12. Lehr attendant job postings were, generally speaking, awarded to persons with low seniority. On the other hand, other jobs in the selecting department, such *75 as inspector and lehr foreman, were invariably awarded to persons with extremely high seniority (between 10 and 20 years). The result was that many women who were unable to achieve inspector jobs could easily have posted for and received lehr attendant jobs but elected not to take the lehr attendant job. On occasion, when Owens-Illinois laid off employees from the selecting department, women selectors with higher seniority than male lehr attendants elected to be laid off rather than take the lehr attendant job which they could have obtained.
13. The lehr attendant job is performed standing up and has not become physically less demanding over the years; whereas the selector job is performed sitting down and has become easier due to mechanization over the years.
14. There was no evidence that a single woman applied for or posted for the job of lehr attendant and was refused such job.
15. Since March 23, 1974, most of the women employed at the Oakland plant were employed in the finished products department and very few women, if any, were employed in the mold repair, central mold shop, corrugated, forming, trucking, warehouse, maintenance, and batch and furnace departments.
16. In the departments in which few women have been employed since March 23, 1974 there is a very low rate of turnover and most of the employees employed in those departments during this period of time were employed by Owens-Illinois prior to March 23, 1974. Approximately 75% of all job vacancies during this period of time have occurred in the lowest entry level positions at the Oakland plant classified in the EEO category of operatives and laborers.
17. Since March 23, 1974 women were employed when qualified and available in the vacancies in the eight departments in which few women are employed. Thus, since March 23, 1974 at least seven women were employed in the batch and furnace department as general laborers, at least two women were employed in the maintenance department as apprentices, at least one woman was employed in the machine repair department as a machinist helper, at least one woman was employed in the central mold shop as a mold inspector, at least six women were employed in the corrugated department as corrugators and a large number of women were employed in the maintenance department. Additionally, some women who were hired since March 23, 1974 in these departments subsequently quit or left Owens-Illinois for their own reasons and these persons are not reflected in either the exhibits or the plaintiffs' or defendant's statistics.
18. In the departments in which very few women were employed since March 23, 1974 all jobs above entry level were filled through job postings. Entry level jobs in trucking, warehouse, corrugated, and mold repair were filled exclusively from union hiring halls; maintenance, central mold shop, and forming from apprenticeship programs. The hiring hall and apprenticeship program mechanisms were established pursuant to union-management agreements and were administered jointly by the union and the company. There was no evidence that the hiring halls or apprenticeship programs had a discriminatory purpose or effect.
19. Most entry level jobs in the mold repair, trucking, central mold shop, machine repair, forming, warehouse, batch and furnace, and maintenance department, require a high degree of specialized skill or are extremely dirty, heavy work.
20. Since March 23, 1974 there was no evidence that a qualified woman applied for and/or was denied a vacancy in the machine repair, central mold shop, corrugated, forming, trucking, warehouse, maintenance, and batch and furnace departments. There was, however, evidence of women being offered and accepting or refusing entry level positions and apprenticeships in these departments.
21. Plaintiffs introduced a myriad of statistics during the trial. These statistics were, in large part, confused, and misleading. The statistics relied upon unreal and contrived wage and pay figures, excluded *76 large populations of the plant including new hires and non-Black minorities, and were deficient in other ways.
22. Since March 23, 1974 between 32% and 37% of the employees hired at the Oakland plant have been women. There was no evidence that any qualified woman applied for and was denied employment at the Oakland plant.
23. Since March 23, 1974 the terms and conditions of the employment including pay, promotions, terminations, and treatment of 90% of the female employees was governed, in large part, by the collective bargaining agreements between the company and the union which represented employees in each of the separate departments, and the Court finds these agreements to be non-discriminatory.
24. Since March 23, 1974 the Oakland plant had in effect salary and hourly job posting mechanisms whereby vacancies in 95% of the positions at the Oakland plant were brought to the attention of all employees who then had an opportunity to bid on such jobs. Approximately 90% of the time the job was then awarded to the senior person. If the senior person was not awarded the job, it was because such person lacked the necessary qualifications for the job.
25. During the course of the trial, plaintiffs introduced evidence of Owens-Illinois' dealings with the federal government compliance agencies, including the adoption by the Oakland plant of a special program for an "affected class" which included women who were purportedly not promoted out of the selector job between 1942 and 1973. However, this action and other activities between the office of the contract compliance and Owens-Illinois regarding enforcement of the Executive Orders 11246 and 11375 were not per se probative of any discriminatory activity at the Oakland plant after March 23, 1974.
26. That Owens-Illinois management has discretion to decide who will be promoted to a few union positions and all non-union positions by being the primary judge of whether an applicant has the ability for a particular job.
27. That Owens-Illinois has used its discretion to promote men over women because of their sex.
28. That there is a large available pool of women both within the plant and in the surrounding communities who are qualified for managerial positions.
29. That throughout the relevant period, Owens-Illinois has intentionally engaged in a pattern and practice of promoting only men into its management positions even though qualified women were available.
30. That there are no written standards or guidelines for promotion to management level jobs. All promotions except for the top five positions at the plant are determined by the individual supervisor of the departments in which there is a management vacancy. There is no system whereby any management job openings are publicized to the employees, and there is no system of applying for these jobs. Normally, supervisors choose a candidate for a job without the candidate's knowledge.
31. That throughout the relevant period, Owens-Illinois has had management training positions in which it has placed men both as new hires and as transfers from other jobs in the company. The position of student industrial engineer in the cost control department was the major training job for management employees. Women were not chosen for entry into this program even though qualified women were available at the plant and in the general population.
32. That despite the fact that most employees in the finished products/selecting department are women, virtually none of the supervisors of that department have been women during the relevant period.
33. That the policies and practices of Defendant regarding promotion, especially into management positions, have unduly restricted females both from promotions into these positions and from the promotion process itself, since the Oakland plant has had virtually no female supervisors or management personnel.
*77 CONCLUSIONS OF LAW
1. That Defendant has engaged in conduct with the purpose and effect of discriminating against women, on account of sex, in that Defendant has:
a. Unduly limited the initial hiring of women for management training positions.
b. Unduly limited the promotion of women to supervisory and management level positions.
2. That this Court shall determine appropriate relief in accordance with these findings.
CLAIM OF AUNITA JONES
1. Aunita Jones is a 31-year-old Black woman.
2. Aunita Jones was hired by Defendant Owens-Illinois on July 14, 1971 as a secretary in the personnel department at Defendant's Oakland Plant.
3. Aunita Jones was the first Black employee ever hired by Defendant in its personnel department at its Oakland Plant.
4. Before she was hired, Aunita Jones was interviewed by Defendant's assistant personnel director, Mike Lunny. During this interview Mr. Lunny asked Ms. Jones how she would respond if she were called a "nigger". He told her that as the first Black person hired in the personnel department, her performance would determine whether other Blacks were hired into personnel.
5. After she began working for Defendant, Aunita Jones was subjected to racial insults by a co-worker. Aunita Jones complained to her supervisors about this conduct including the director of personnel, but no apparent remedial action was taken, and Aunita Jones continued to be subjected to this treatment.
6. In November 1974, Mr. Joe Woods was placed in the assistant personnel director's job. Bart Oxley then asked Aunita Jones to train Mr. Woods even though he continued to maintain that she was unqualified for the job. In December 1974, Aunita Jones transferred out of the personnel office to the maintenance department as a secretary.
7. Thereafter on several occasions Aunita Jones complained to the personnel director about racially discriminatory policies of the company and about his conduct in particular in racial matters.
8. In June 1975, Aunita Jones was accused by Defendant of forging the name of a doctor employed by the company to a disability claims form which Aunita Jones had submitted to her own private insurance company.
9. Aunita Jones at all times denied she had committed this forgery.
10. Defendant did not in good faith believe that Aunita Jones had forged the form.
11. The claims form was not related to any job duties for which Aunita Jones was responsible.
12. Defendant terminated Aunita Jones on June 6, 1975. The reason stated for termination was that Aunita Jones had forged the claims form. Defendant also charged alternately that Aunita Jones had not recorded days she was sick on her attendance card.
13. In fact, Aunita Jones had recorded her days absent but she had mistakenly recorded the absence in the wrong week. Defendant was aware and informed that Aunita Jones had in fact recorded all her absent days.
14. The reasons stated by Defendant for terminating Aunita Jones were a mere pretext. In fact, Aunita Jones was terminated by Defendant because of her race and because of her outspoken opposition to discrimination against Black persons by Defendant.
15. The acts of Defendant described above were done intentionally and wantonly and for the purpose of discriminating against Aunita Jones because of her race and her actions to combat the racially discriminatory acts of Defendant.
16. Defendant did not subject its White employees to the treatment described above which Defendant subjected Aunita Jones to.
*78 17. That at the time Aunita Jones was terminated on June 6, 1975, she was employed in a Grade 4 position as a secretary in the Maintenance Department.
18. That she became employed at the rate of $600.00 per month in August, 1975.
19. That she received $50.00 raises every six months.
20. That as of July 24, 1978, she was earning $850.00 per month.
21. That therefore Aunita Jones earned $25,400 since her termination.
22. That Aunita Jones would have earned an additional $6,888.50 if she had continued to be paid at the same rate, with normal raises, as she was paid as of her termination date.
23. Since March 7, 1971, Owens-Illinois did not engage in any act or practice in her compensation, training, or promotion which either discriminated against, or had any adverse impact or effect upon, Aunita Jones because of her race.
24. Since March 23, 1974, Owens-Illinois did not engage in any act or practice with respect to her compensation, training, promotion, treatment, termination, or terms, conditions, or privileges of employment which discriminated against Aunita Jones, or had any adverse impact or effect upon her, because of her sex.
CONCLUSIONS OF LAW
1. Since March 23, 1974, Owens-Illinois did not discriminate against Aunita Jones because of her sex in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
2. Defendant Owens-Illinois did discriminate against Aunita Jones on the basis of her race in violation of 42 U.S.C. § 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and Aunita Jones is entitled to a judgment against Owens-Illinois, Inc. in the amount of $15,000 compensatory damages, $15,000 punitive damages and back pay of $6,888.50.
CLAIM OF ROBERT HAROLD
1. That Robert Harold is a Black male who worked for Owens-Illinois from April 9, 1968, to September 6, 1977. He became the first Black maintenance mechanic at the plant after completing the apprentice program.
2. That during the relevant period, Robert Harold was a temporary leadman eight or nine times and was the first Black temporary leadman.
3. That when Robert Harold was temporary leadman the Defendant failed to support his authority while it did support the authority of similarly situated White employees.
4. That on one occasion when Robert Harold was temporary leadman, one of his crew threw water in his face; and that the management official in charge and present at that time intentionally and wantonly did nothing to indicate company disapproval and in fact intentionally and wantonly joined in the amusement of the all-white crew thereby ratifying said action and failing to support the authority and dignity of a temporary leadman whereas the company did so support the authority and dignity of similarly situated White employees.
5. That on one occasion, when Robert Harold was a temporary leadman, a member of his crew named George set the time clock ahead so that he could leave early and still be paid for an eight hour day.
6. That Robert Harold reported this incident to the proper company official and yet the company paid George his full eight hour salary, thereby intentionally and wantonly failing to support the authority of Robert Harold as temporary leadman whereas the company did so support the authority of similarly situated White employees.
7. That on several occasions when Robert Harold was a temporary leadman, Steve Greenwood, a member of his crew, refused to carry out the assignment given to him by Robert Harold.
8. That Robert Harold reported this to the proper company official and that no action was ever taken by the company and *79 thereby the company intentionally and wantonly refused to support the authority of Robert Harold as temporary leadman whereas the company did so support the authority of White employees similarly situated.
9. Since March 7, 1971 Owens-Illinois did not engage in any act or practice with respect to his compensation, placement, promotion or termination, which discriminated against Robert Harold or had any adverse impact or effect upon him because of his race.
CONCLUSIONS OF LAW
Defendant Owens-Illinois did discriminate against Robert Harold on the basis of his race in violation of 42 U.S.C. § 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq., and Robert Harold is entitled to compensatory damages in the amount of $5,000, and punitive damages in the amount of $15,000.
CLAIM OF ALICE BRICE
1. Alice Brice is a Black woman who has been employed by Defendant from May 18, 1964 to the present time.
2. That Alice Brice has a B.S. Degree in business which she received prior to applying to Owens-Illinois for work.
3. That Alice Brice received a teaching credential as a result of her graduation from college in the State of Arkansas and subsequently in 1969 received one from the State of California.
4. That when hired at the company, Alice Brice was assigned the job of traffic clerk. She was promoted to the job of shift dispatcher on July 1, 1972 and was then promoted to traffic representative on August 16, 1974, to Traffic Supervisor on August 1, 1977, and she continued to hold that job as of the time of trial.
5. That despite her college degree and experience with the company Ms. Brice was refused on the basis of her race and sex a job in the industrial engineering department which is the normal position for management trainees, even though she requested such placement.
6. That a supervisor told Alice Brice that she was not to speak to another Black employee who was a teletype operator and who had to converse with Alice Brice in the course of her daily work. Other women in the department spoke to each other, but no White woman was ever told to cease speaking to other women in the department.
7. That Alice Brice took a leave of absence for her pregnancy on January 31, 1972. She was allowed only six weeks for pregnancy leave even though other employees were allowed six months.
8. As a result of discrimination experienced at the company, Alice Brice experienced serious hypertension while she was pregnant in 1972 and had to be treated for this. The diagnosis was confirmed by the company doctor as well as her treating doctor.
9. That Alice Brice, while in the traffic department did her work very well and needed very little supervision and was very accurate.
10. That Alice Brice complained to the Fair Employment Practices Commission of the State of California in 1971. A representative of the organization called Mr. Bart Oxley who stated that she did not have to pursue the complaint with the FEPC since he understood that her supervisor was a problem and he would try to take care of it. Nothing was changed as a result of this complaint.
11. Soon after this, upon return from maternity leave, Alice Brice was offered the job of shift dispatcher on the swing shift. She was told that this was to include a pay increase and an 8% shift differential and overtime pay for working on Sunday.
12. That because of her race and sex no pay raise was given to Alice Brice when she took over the job of shift dispatcher which was one grade level higher than her previous job; she was also not given a shift differential and overtime pay as had been promised to her.
13. That because of her race and sex when she became radio dispatcher she was *80 ordered to take on the additional duties of the shipping clerk on her shift, which included typing and filing. At that time there were three other radio dispatchers, all of whom were White males. Alice Brice was the first female radio dispatcher. None of the other radio dispatchers had to do the work of the shipping clerk. The shipping clerk who had previously worked on the same shift as Alice Brice was moved off the shift and only Alice Brice was told to do that work. There was no extra pay for doing this work.
14. Alice Brice was also ordered to take on additional duties of receiving records and time cards which the other dispatchers did not have to do.
15. Charles Santillanes, whose job Alice Brice took over, was directed by the supervisor of that department that he should not train her because he did not want her in the department.
16. During this time she worked as dispatcher and also doing the extra work as shipping clerk, she was suffering from glaucoma, dizzy spells, and general hypertension. She had to take medication for the hypertension from this time in 1973 and has continued to have to take it through the present time.
17. Alice Brice requested to be trained as a service representative in the spring of 1974. There was no posting system for higher level salaried jobs and she was never invited to take any jobs other than the shift dispatcher job up until that time. The only way to obtain a promotion in the higher level salaried range was to be offered a job by a supervisor or higher management person. Sometime after 1974 a promotion committee was set up to review some of the management promotions. It did not review all promotions as some supervisors still made their own decisions.
18. That Alice Brice, after making this request, approached Willie Huff, the EEO Coordinator at the plant, as a member of the promotion committee in an attempt to get promoted into the service department. She was informed that the head of the service department felt that women should stay home and have babies and she could not get the job. Upon objecting to the refusal to Bart Oxley, the personnel director, Alice Brice was told it was the feeling of the company that she would be offensive as a service representative although he would not explain the remark and had not so treated White employees. Alice Brice was qualified for that job.
19. That on September 23, 1972 Alice Brice, with other Black employees, signed a petition addressed to management officials of Defendant complaining of the lack of opportunities for Black employees. As a result she was called into the office of her supervisor and told that she was not discriminated against by him but he admitted her prior supervisor had discriminated against her.
20. In 1974 Alice Brice requested consideration for the traffic representative job which she discovered was to be vacant. She spoke to her immediate supervisor, but he did nothing to assist her in getting the job and therefore she wrote a letter to Mr. Willie Huff, the EEO Coordinator.
21. That Alice Brice was not considered as the primary candidate for the job by the plant manager and the personnel director at the promotion committee meeting. Subsequent to the meeting a letter was written by Mr. Huff, the EEO Coordinator, further recommending Alice Brice and subsequently on August 16, 1974 Alice Brice was then given the job of traffic representative, but only on condition that she take certain courses that White males before her had not had to take.
22. That because she was Black her authority was not supported by management when a White subordinate would not work for her and walked off the job. The employee was not penalized for her behavior and received a transfer to another department.
23. That when Alice Brice was given the traffic representative job she received a pay increase from $770 to $850 per month, the minimum salary range for her new job. Even though the job was ordinarily an exempt *81 job, her starting salary was too low to consider her exempt, so therefore she was initially considered a non-exempt employee and was paid for over-time.
24. That after receiving this job Alice Brice again requested to be trained as an Industrial Engineer and asked to be considered for distribution manager in the warehouse. Because of her race and sex no response was given to her by her supervisors and management officials on this request.
25. That on September 9, 1974, Alice Brice signed a letter directed to the President of the corporation complaining of racial problems in reference to the letter previously sent in 1972. Alice Brice was a signatory among six Black individuals who signed the letter (Exhibit # 70).
26. That because she was Black and a woman she was not allowed to take the Dale Carnegie course that was generally given to all management personnel at Owens-Illinois by her supervisor when she specifically requested it.
27. That because of her race and sex she was denied the job of trucking supervisor, for which she was qualified, since she knew about rates and tariffs and had previously worked in the shipping department. Upon complaining about this to management she was informed by her supervisor that the shipping supervisor, Dave Hattig, said he wasn't ready to have a woman report to him.
28. That Alice Brice continues to request and is qualified for promotions but, because of the intentional discrimination of Defendant she has received none since 1977.
29. The acts of Defendant described above had the purpose and effect of discriminating against Alice Brice because of her race and sex and her actions to combat the discriminatory acts of Defendant.
30. Alice Brice has suffered a loss in pay as a result of said discriminatory practices described above in an amount equal to the difference between the wages and salary actually received by her and the sum she would have received had she been earlier promoted to the jobs for which she was qualified, and which were filled by others. The amount shall be computed after further hearing.
31. That Alice Brice suffered a serious medical and nervous condition since 1972 due to the discrimination caused by Owens-Illinois for which she has been continually treated at Kaiser Hospital. Said discrimination also affected her private life and caused marital problems between her and her husband. She had a worsening of the glaucoma problem in her eye and has had rashes, hair loss and sleeping problems.
CONCLUSIONS OF LAW
Defendant Owens-Illinois did discriminate against Alice Brice on the basis of her race and sex in violation of 42 U.S.C. § 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and Alice Brice is entitled to a judgment against Owens-Illinois, Inc. in the amount of $50,000 compensatory damages, $15,000 punitive damages and back pay in an amount to be fixed by the Court after further hearing.
OTHER INDIVIDUAL CLAIMS
LOUIS ALTHEIMER
1. Louis Altheimer is a Black male employed at the Oakland Plant since July 22, 1963.
2. Louis Altheimer filed an EEOC charge against Owens-Illinois on April 7, 1977.
3. Since March 7, 1971, Owens-Illinois did not engage in any act or practice with respect to his compensation, terms of employment, promotions, demotion, or treatment, which discriminated against, or had any adverse impact or effect upon, Louis Altheimer because of his race.
4. Louis Altheimer was not offered the position of a salaried foreman at a salary less than the salary being offered to another person who was not Black.
5. Louis Altheimer was demoted in March, 1977 from relief foreman to fork lift driver because of his harassment of two *82 female employees at the Oakland Plant, his becoming involved in an altercation with a subordinate employee, his general poor work performance, and his inability to perform the job of relief foreman. The demotion was in no way based upon the fact that he was Black.
6. There was no credible evidence that Louis Altheimer was harassed or discriminated against in job assignments, or disciplined, or criticized in any manner because of his race.
MARSHALL DAILEY
1. Marshall Dailey is a Black male who was hired at the Oakland Plant on November 3, 1969 and was terminated on July 12, 1972.
2. Marshall Dailey filed an EEOC charge on August 3, 1972.
3. Since March 7, 1971 Owens-Illinois did not engage in any act or practice with respect to his promotion, termination, treatment, compensation, terms, condition or privileges of employment which discriminated against or had any adverse impact or effect upon Marshall Dailey because of his race.
4. Since March 7, 1971 Owens-Illinois did not assign the most difficult, onerous, or dirty jobs to Black employees as a class, or to Marshall Dailey individually.
5. On July 7, 1972 Marshall Dailey refused to perform work properly assigned to him by his foreman and he walked off the job without authority. He was terminated because of his refusal to work and his having walked off the job. Such termination was uniformly applied to Owens-Illinois employees who engaged in similar conduct, and was not applied to Marshall Dailey because of his race.
6. Since March 7, 1971 Owens-Illinois did not retaliate against any employees, including Marshall Dailey, because of their complaints to the EEOC, or to company management.
GAIL GARRETT
1. Gail Garrett is a Black female who was hired at the Oakland Plant on December 16, 1970. She was terminated on January 14, 1975.
2. Gail Garrett filed an EEOC charge on February 7, 1975.
3. Since March 7, 1971, Owens-Illinois did not engage in any act or practice with respect to her compensation, promotion, termination, treatment, terms, condition or privileges of employment which discriminated against Gail Garrett, or had adverse impact or effect upon her because of her race.
4. Since March 23, 1974, Owens-Illinois did not engage in any act or practice with respect to her compensation, promotion, termination, treatment, terms, condition or privileges of employment which discriminated against Gail Garrett, or had any adverse impact or effect upon her because of her sex.
5. Owens-Illinois did not refuse to rehire Gail Garrett after her termination because of her race or sex.
6. Owens-Illinois did not refuse to give Gail Garrett training as a PBX operator and a teletype operator because of her race.
7. The failure to promote Gail Garrett to keypunch supervisor was not because of her race or sex.
8. Gail Garrett was not required to do more work than either male or White employees doing the same job or receiving the same pay as she, nor was she required to do more work or work under more severe conditions because of her race or sex.
9. The request made to Gail Garrett to work during the strike in 1974, or the request for her to work during July 4, 1974, or during evenings, were requests made of other salaried employees and were not made to her in an attempt to harass her or mistreat her because of her race or sex.
10. Gail Garrett was discharged on January 14, 1975 for cause because of her insubordination and conduct which created an irreconcilable conflict between Gail Garrett and her supervisor, Mary Villa. The discharge *83 was not because of her sex, or because of her race.
CHARLOTTE HARRIS
1. Charlotte Harris is a Mexican-American female who was hired at the Oakland Plant on August 3, 1966. She entered an apprenticeship program at the Oakland Plant on January 30, 1975, and was terminated from that program on December 30, 1976. She is currently an employee at the Oakland Plant.
2. Charlotte Harris filed an EEOC charge on January 11, 1977.
3. Since March 23, 1974, Owens-Illinois did not engage in any act or practice with respect to her compensation, placement, training, promotion, treatment, terms, conditions, or privileges of employment which discriminated against Charlotte Harris or had any adverse effect or impact upon her because of her race or sex.
4. Since March 23, 1974, Owens-Illinois did not discriminate against Charlotte Harris in admission to, or termination from, any program established to provide apprenticeship or other training because of her race or sex.
5. The requirement that Charlotte Harris take certain courses in her apprentice program was a requirement uniformly applied to all apprentices, and was not a requirement of Charlotte Harris because of her sex or race.
6. The requirement that Charlotte Harris enter the apprentice program, and the refusal to make her a maintenance mechanic without such apprentice program was uniformly applied to persons of her ability and qualifications to perform the job of maintenance mechanic, and was not a requirement of Charlotte Harris because of her race or sex.
7. Charlotte Harris was not harassed, or subjected to treatment or requirements not required of other persons in the apprenticeship program.
8. The requirement that Charlotte Harris complete a mathematics course was a requirement uniformly applied to all apprentices. Charlotte Harris failed to complete the mathematics courses within the time required. She was terminated by the joint apprentice committee composed of (1) members of the union which represented persons in the maintenance department and (2) members of management. She was terminated because she failed to complete the mathematics course.
9. Charlotte Harris has been promoted and has received pay increases comparable to other employees of equal seniority and ability, without regard to their race or sex. There is no evidence that she was denied any promotion or denied any pay raise because of her race or sex.
10. When Charlotte Harris was terminated from the apprenticeship program, she returned to a job in the Selecting Department. This was the only vacancy available. The return of Charlotte Harris to this job was not a reduction in pay or mistreatment in terms or conditions of employment because of her race or sex. She has subsequently been promoted when other jobs became available as a result of her seniority.
JUDY WEEK
1. Judy Week is a White female who was employed at the Oakland Plant on June 16, 1965.
2. Judy Week filed an EEOC charge on June 29, 1976.
3. Since March 23, 1974, Owens-Illinois did not engage in any act or practice in connection with her compensation, training, promotion, treatment, or terms, conditions, or privileges of employment which discriminated against Judy Week, or had any adverse impact or effect upon her, because of her sex.
4. From March 23, 1974, to the time of trial, Judy Week was promoted to cost and budget clerk and later to cost accountant in the central mold shop. She was not denied any promotions because of her sex.
5. In late 1975, Judy Week was asked to perform additional duties. Her supervisors complained that she was unable to perform *84 these duties adequately, and Judy Week admitted that she was unable to perform these duties. The complaints of her performance were not harassment of Judy Week because of her sex.
6. In early 1976, Judy Week complained that she needed training for her job. A program was established to provide for her training. She was not denied training because of her sex.
CURTIS WILLIAMS
1. Curtis Williams was employed at the Oakland Plant on October 21, 1964. He was terminated on May 19, 1972.
2. Curtis Williams filed an EEOC charge on January 21, 1975.
3. In 1973, Curtis Williams sought reemployment at the Oakland Plant. He was denied employment at the Oakland Plant, but was hired by the Forest Products Division of Owens-Illinois at a plant in Union City, California. Curtis Williams voluntarily terminated his employment at the Forest Products Division plant in Union City, California on February 6, 1973.
4. Since March 7, 1971, Owens-Illinois did not engage in any act or practice with respect to termination, compensation, training, promotion, treatment, terms, conditions, or privileges of employment of Curtis Williams which discriminated against him, or had any adverse impact or effect upon him, because of his race.
5. The failure of Owens-Illinois to rehire Curtis Williams at the Oakland Plant was not because of his race.
6. Curtis Williams was not denied any promotions because of his race, or because of any retaliatory action against him because of complaints to management.
7. Curtis Williams was not denied a promotion to foreman because of his race.
8. Owens-Illinois did not harass Curtis Williams or treat him differently than other employees.
9. In May, 1972, Curtis Williams failed to report to work for a five day period and was terminated. Termination for failure to report to work for five days was equally applied to all employees, regardless of race, and Curtis Williams was not terminated because of his race.
10. At all times Curtis Williams was paid wages as provided by the agreement between Owens-Illinois and the union which represented the employees in the department where Curtis Williams worked. He was not denied any pay, nor was he treated differently with respect to pay, because he was Black.
EUGENE WILLIAMS
1. Eugene Williams is a Black male who has been employed at the Oakland Plant since July 10, 1964.
2. Eugene Williams filed an EEOC charge on September 3, 1971.
3. Since March 7, 1971, Owens-Illinois did not engage in any act or practice with respect to his compensation, training, promotion, treatment, or terms, conditions, or privileges of employment which discriminated against Eugene Williams or had any adverse impact or effect upon him because of his race.
4. Eugene Williams was promoted to a crew leader in 1974. At no time prior to that was he denied any promotion because of his race, and at no time prior to that was any person, less senior or less qualified, appointed to a crew leader job ahead of him.
5. Owens-Illinois did not deny Eugene Williams the right or ability to become a member of the International Brotherhood of Teamsters.
6. Owens-Illinois did not assist any persons to become members of the International Brotherhood of Teamsters and did not refuse to assist Eugene Williams to become a member of that union because of his race.
7. Eugene Williams was offered an apprenticeship position in the Maintenance Department, which he refused. Owens-Illinois did not permit any person to become a maintenance mechanic with similar or fewer qualifications than Eugene Williams. *85 He was not denied the opportunity to immediately become a maintenance mechanic because of his race, but was denied the job because of his inability to perform the work required of a maintenance mechanic without apprenticeship training.
8. Eugene Williams was not denied the position of supervisor of the Forming Department or supervisor of the Selecting Department because of his race, but because more qualified persons were appointed in each of those jobs when they became vacant.
9. Eugene Williams was not denied any training which would have permitted him to become a shift foreman.
10. AVO's placed into Eugene Williams' file because of performance or attendance were not placed there because of harassment or retaliation against him because he is Black, or because he has complained to management about discrimination. Such AVO's were customarily placed in the files of other employees, regardless of their race, because of conduct similar to that of Eugene Williams.
11. In 1976, Eugene Williams was appointed to the job of Assistant Selecting Foreman. At that time he had the lowest seniority of any of the persons who were appointed to that position.
12. The shift foremen who were appointed between 1970 and 1976, prior to Eugene Williams, all were employed by Owens-Illinois prior to the time Eugene Williams was employed by Owens-Illinois, and all had greater seniority.
FLOYD WILLIAMS
1. Floyd Williams is a Black male who was hired at the Oakland Plant on March 21, 1962. Floyd Williams was terminated on September 11, 1974.
2. Floyd Williams filed an EEOC charge on September 23, 1974.
3. Since March 7, 1971, Owens-Illinois did not engage in any act or practice with respect to his termination, compensation, training, promotion, treatment, or terms, conditions, or privileges of employment which discriminated against Floyd Williams, or had any adverse impact or effect upon him, because of his race.
4. Floyd Williams was interviewed for a job as sales representative for Owens-Illinois. His interview was conducted in the same manner in which all interviews of other employees were conducted. The persons interviewing Floyd Williams determined that he was not qualified for the position of sales representative. The decision of such persons was based upon his lack of qualifications, and was not based upon his race.
5. Floyd Williams was not denied the opportunity to participate in the glass bottle quality audits. He declined to participate in such audits because he had outside employment which did not permit him to work overtime.
6. Floyd Williams was not denied any training because of his race.
7. Floyd Williams was not denied any promotions because of his race. Because of his ownership of a motel, he took substantial leaves of absence and did not work overtime. As a result of such leaves of absence and inability to work overtime, he was not promoted. The failure to promote Floyd Williams was because of his outside activities, and not because of his race.
8. Floyd Williams was not harassed, nor was there any retaliation against him, because of his participation in group meetings where complaints of racial discrimination were made to management, nor was there any retaliation, or harassment, because of his complaints to the EEOC.
9. Floyd Williams was warned for being away from his work in June, 1974. Other employees who were away from their work were terminated. His treatment as a result of the incident was neither harassment nor retaliation.
10. Floyd Williams was terminated September, 1974, because he threatened his supervisor. He had previously been warned about conduct directed towards management. The termination of Floyd Williams *86 was because of his threatening conduct, and was not because of his race. Any other employee, who had engaged in similar conduct, would have been terminated regardless of that employee's race.
CONCLUSIONS OF LAW
1. Since March 7, 1971, Owens-Illinois did not discriminate against Louis Altheimer because of his race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
2. Since March 7, 1971, Owens-Illinois did not discriminate against Marshall Dailey because of his race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
3. Since March 7, 1971, Owens-Illinois did not discriminate against Gail Garrett because of her race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
4. Since March 23, 1974, Owens-Illinois did not discriminate against Gail Garrett because of her sex in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
5. Since March 23, 1974, Owens-Illinois did not discriminate against Charlotte Harris because of her race or sex in violation of Title VII of the Civil Rights Act of 1064, 42 U.S.C. § 2000e et seq.
6. Since March 23, 1974, Owens-Illinois did not discriminate against Judy Week because of her sex in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
7. Since March 7, 1971, Owens-Illinois did not discriminate against Curtis Williams because of his race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
8. Since March 7, 1971, Owens-Illinois did not discriminate against Eugene Williams because of his race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
9. Since March 7, 1971, Owens-Illinois did not discriminate against Floyd Williams because of his race in violation of either 42 U.S.C. § 1981 or Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.
The foregoing Findings of Fact and Conclusions of Law are made this Eighth day of January, 1979.
JUDGMENT
The trial of this action having commenced on July 12, 1978, before the Court and a jury, and the jury having reached both advisory and binding verdicts on October 2, 1978, and the Court having issued its Findings of Fact and Conclusions of Law on January 8, 1979,
IT IS HEREBY ORDERED AND ADJUDGED as follows:
1. This action is maintainable as a class action pursuant to Fed.R.Civ.P., Rule 23(b)(2), on behalf of the following two classes: (a) all blacks who were employed at defendant's Oakland plant at any time since March 7, 1971; (b) all women who have been employed at defendant's Oakland plant since March 23, 1974.
2. The certified class of all black employees who were employed at defendant's Oakland plant since March 7, 1971, is entitled to no relief, and its claims and the complaint on its behalf are dismissed.
3. The certified class of all female employees who have been employed at defendant's Oakland plant since March 23, 1974, is entitled to equitable relief in the terms of the Remedial Order which is attached hereto as Exhibit 1 and incorporated herein by reference.
4. Plaintiff Robert Harold shall recover from defendant, $5,000 compensatory damages and $15,000 punitive damages, for a total sum of $20,000, in accordance with the verdict of the jury.
5. Plaintiff Aunita Jones shall recover nothing on her claim of sex discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq., but shall recover from defendant Owens-Illinois, Inc., $15,000 compensatory damages and $15,000 punitive damages, in accordance with the verdict of the jury, and back *87 pay in the amount of $6,888.50 in accordance with the Court's Findings of Fact and Conclusions of Law, for a total sum of $36,888.50 for violation of 42 U.S.C. § 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq.
6. Plaintiff Alice Brice shall recover from defendant, $50,000 compensatory damages and $15,000 punitive damages in accordance with the verdict of the jury and back pay in the amount of $15,061.34 for violations of 42 U.S.C. § 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., and defendant is further ordered to pay Alice Brice, for services commencing on April 1, 1979, the sum of $1,866.24 per month and to continue payment at such rate until the salary rate of the job she is actually performing shall exceed such rate, at which time her salary shall then be fixed by the regular salary rate.
7. Plaintiffs Louis Altheimer, Marshall Dailey, Gail Garrett, Charlotte Harris, Judy Week, Curtis Williams, Eugene Williams, and Floyd Williams each shall take nothing, and all claims of these defendants are dismissed on the merits.
8. The prevailing plaintiffs are awarded: (a) their costs, taxable under 28 U.S.C. § 1920, pursuant to Fed.R.Civ.P., Rule 54(d), and (b) a reasonable attorneys' fee, which is fixed, after due consideration of all circumstances, at $50,000.
9. The Court retains jurisdiction for the purpose of determining the nature and extent of the relief to be awarded to the class of female employees under the Remedial Order.
EXHIBIT 1
REMEDIAL ORDER RE THE CLASS OF FEMALE EMPLOYEES
The Court having considered the parties' suggestions as to the relief appropriate to the Class of Female Employees, and a hearing thereon having been held on February 16, 1979, this Court now makes this Remedial Order in accordance with its Findings of Fact and Conclusions of Law entered January 8, 1979.
Injunctive Relief
I. Owens-Illinois is hereby enjoined from discriminating against women on account of their sex by unduly limiting the hiring of women for management training positions or by unduly limiting the promotion of women to supervisory and management level jobs.
II. Owens-Illinois is hereby ordered to implement the procedures and standards set forth below.
A. Development of Job Descriptions and Employee Qualification Standards and Training Opportunities
(1) Within sixty (60) days of entry of judgment Owens-Illinois shall develop job descriptions for all supervisory/management positions at the Oakland plant.[1] Such job descriptions shall specify the duties and functions of, and the job-related qualifications necessary to perform, each salaried supervisory/management job, including the salary, duties, hours, supervisor, employees supervised, responsibility, working conditions, and, where applicable, special qualifications, skills, strength, education, experience, prerequisite training, etc. Owens-Illinois shall revise these job descriptions whenever necessary to conform them to job-related changes with respect to efficient and safe performance of such job(s).
(2) Within ninety (90) days of entry of judgment Owens-Illinois shall perform a "skills inventory" questionnaire [in a format *88 substantially similar to Exhibit A] at the Oakland plant to ascertain for all current and future hourly and salaried employees their individual level of education, prior work experience [with Owens-Illinois and other employers], and interest in "placement" in salaried jobs at the Oakland plant which become vacant in the future. The "skills inventory" shall be periodically updated as necessary. An employee may elect not to complete the "skills inventory" questionnaire, but at any subsequent time such employee may request and complete a "skills inventory" questionnaire.
(3) Within sixty (60) days of entry of judgment Owens-Illinois shall notify all female employees of all current salaried supervisory/management training programs, including, where applicable, scheduled date(s) and the application procedure necessary to obtain consideration for enrollment.
B. Procedures for Selection of Employees to Fill Salaried Supervisory, Management, and Management Trainee Vacancies
(1) Owens-Illinois shall post conspicuously on one or more designated bulletin boards in the Oakland plant a JOB POSTINGNOTICE OF VACANCY (including, at least, job title, duties, salary, and any special qualifications reasonably required, together with the legend "Both Female and Male Applicants Encouraged"), for each salaried supervisory, management and management trainee job vacancy position at the plant and shall make available upon request the description of and qualifications for such job as developed in accordance with Paragraph II.A(1) above. (The notice should, unless otherwise necessary, be posted at least eight working days before the job is filled.)
(2) Owens-Illinois shall accept from interested employees or other applicants written applications for such posted job vacancies in a form similar to Exhibit B for a period of at least five working days. (Owens-Illinois may, if necessary, fill the job on a temporary basis until the full selection procedure can be accomplished.)
(3) Selection of the employee or other applicant for all salaried supervisory/management and management trainee position vacancies except the top five positions at the plant shall be made by the following procedure:
(a) All applications will be considered;
(b) All employees will be considered who have the necessary qualifications as reflected in the "skills inventory";
(c) If there are no female applicants or candidates for any salaried supervisory/management or management trainee vacancy, then Owens-Illinois shall solicit interest from qualified current Oakland plant female employees and/or from qualified females otherwise available.
(d) Owens-Illinois may also consider for any vacancy such qualified persons without regard to sex who may be otherwise available from outside the Oakland plant, including persons presently employed by the Company at another facility or "new hires" from the Oakland plant recruiting area.
(e) From the candidates selected under the procedures contained in B(3)(a)-(d) above, the supervisor or management official with a requirement to fill any salaried supervisory/management or management trainee vacancy will interview such candidates and thereafter will recommend in writing to the plant administrative manager the top three individual candidates deemed "best qualified", ranking them in order of selection choice with the reason(s) therefor.
(f) In making such recommendation, the supervisor or management official with a requirement to fill any salaried supervisory/management or management trainee vacancy shall consider the candidates' job qualifications, disciplinary records attendance and medical records, length of service (but length of service or seniority is not required to be a controlling factor entitling any candidate to be selected), experience, education, prior training, job performance ratings, interest in the vacant position, and any other factor unique to the job vacancy. The factors which are determinative shall *89 be reflected in writing in the recommendation made to the plant administrative manager.
(g) From the supervisor's or management official's recommendation and from the information available with respect to all other candidates based upon applications on file and the "skills inventory", the plant administrative manager shall select the "best qualified" person to fill the particular job vacancy.
(h) Those who file applications for the vacant job shall be notified promptly in writing who has been selected to fill the vacancy; and unsuccessful candidates, upon request, shall be advised of the reason(s) why they were not selected.
(i) All candidates not selected shall be offered counseling by the plant administrative manager and/or the supervisor or management official who was responsible for filling the vacant job as to how they should prepare for future vacancies in such job, such as specification of additional work, experience, education, training, or other such factors.
C. Record Keeping, Reporting, Dispute Resolution
(1) For a period of two years from the date of entry of judgment, Owens-Illinois shall maintain written records of the foregoing standards and procedures, including copies of all job descriptions, skills inventory records, notices of educational and/or training opportunities, notices of salaried supervisory/management and management trainee position vacancies, applications for such vacancies, supervisor or management official recommendations, notices of filling of vacancies, and requests of unsuccessful applicants for reason(s) required by this Order. For this two-year period, Owens-Illinois shall semiannually file with the Court on August 31 and February 28 of each year a report reflecting the manner in which it has complied with this Order.
(2) In the event that any claim of sex discrimination arises with respect to the filling of any supervisory/management or management trainee vacancy under this Remedial Order within two years from the date of entry of judgment which the job applicant desires to pursue to this Court, such claim shall be referred by this Court to a United States Magistrate for proposed findings of fact and recommendations for disposition pursuant to 28 U.S.C. § 636 and Local Rule 405.
Monetary Relief
I. Proceedings to determine whether back pay should be awarded to any individual member of the Class of Female Employees are referred to the Honorable Fred C. Woelflen, United States Magistrate, or if he is not available to such other Magistrate as the Chief Magistrate may designate.
II. On or before [a date 3 weeks after resolution of any post-trial motions], Owens-Illinois will give notice in substantially the same form as Exhibit C to the Class of Female Employees by distributing to each class member currently employed at the Oakland plant a copy of that notice and Claim Form (Exhibit D) with her paycheck. Notice to class members no longer employed at Owens-Illinois shall be by first-class mail (addressee only return receipt requested) to the most recent address for which Owens-Illinois has record. Copies of the notice shall also be posted on bulletin boards at the Oakland plant used for communication with employees. An official of Owens-Illinois shall certify to the Court compliance with this paragraph.
III. On or before [a date 30 days after the notice date], each class member who wishes to make a claim for back pay shall return to the Court the Claim form (Exhibit D). No back pay claims shall be considered unless the Claim form has been completed and returned to the Court by the specified date, or contains a postmark no later than the specified date.
IV. On or before [one week after return date], the Clerk shall make available for pick-up by counsel for each side copies of the Claim forms which have been submitted.
*90 V. On or before [two weeks after pickup of Claim forms], or at a later date convenient to the Magistrate's Calendar, a status conference shall be held before the Magistrate to which this matter has been referred. At the status conference the following matters, listed by way of illustration and not limitation, shall be discussed:
A. Procedures for determining individual back pay claims;
B. Hearing dates; and
C. Any other matters relevant to the conduct of the hearings.
The Magistrate shall file a written order setting forth the procedures to be followed in determining the validity of back pay claims.
VI. The Magistrate will handle these proceedings in accordance with the Federal Rules of Civil Procedure and Federal Rules of Evidence. At the conclusion of all of the back pay proceedings, the Magistrate shall submit to the Court his Findings of Fact and Recommendation for Disposition with respect to each claimant who has appeared at a hearing.
Special Defense in Proceedings Before Magistrate
In the proceedings before the Magistrate that are referred to in the Sections "Injunctive Relief" (Paragraph II.C.(2)) and "Monetary Relief," the Magistrate is precluded from considering the merits of a claim if defendant shows that claimant, in connection with the claim, had, at the relevant times, an adequate remedy under a collective-bargaining agreement.
Jurisdiction
The Court retains jurisdiction until the four semi-annual reports required by Paragraph C(1) above have been filed with the Court for the purpose of assuring compliance with the provisions of this Order. The action will be dismissed thirty (30) days after the filing of the last such report, unless a party hereto shows good cause for the Court to retain jurisdiction further.
EXHIBIT A
SKILLS INVENTORY FORM
NAME: __________________________________________ DATE: ________________________________
DEPARTMENT: ____________________________________ SHIFT: _______________________________
Background and Skills
1. Education (Circle highest year completed)
Grammar School 1 2 3 4 5 6 7 8
High School 9 10 11 12
College 1 2 3 4
2. Are you presently enrolled in any educational or training programs?
Yes ______________ No ___________
If yes, describe course(s).
3. List the skills you presently have (for example, typing, shorthand, computer,
engineering or other technical skills).
___________________________________________________________________________________
4. List skills you would like to learn. ______________________________________________
___________________________________________________________________________________
5. List or describe any other special skill or ability which you believe supports your
employment goals at Owens-Illinois. _______________________________________________
___________________________________________________________________________________
*91
Work Experience
Describe any employment (outside Owens-Illinois) where you gained experience
which supports your future goals. _______________________________________________
_________________________________________________________________________________
_________________________________________________________________________________
Areas of Interest
Consider each of the following areas of work and list the jobs in each area which
are of most interest to you.
1. Administrative
a. Industrial Engineering
_________________________________________________________________________________
_________________________________________________________________________________
b. Accounting
_________________________________________________________________________________
_________________________________________________________________________________
c. Purchasing
_________________________________________________________________________________
_________________________________________________________________________________
d. Industrial Relations
_________________________________________________________________________________
_________________________________________________________________________________
e. Others
_________________________________________________________________________________
_________________________________________________________________________________
2. Manufacturing
a. Finished Products
_________________________________________________________________________________
_________________________________________________________________________________
b. Quality Assurance
_________________________________________________________________________________
_________________________________________________________________________________
c. Selecting
_________________________________________________________________________________
_________________________________________________________________________________
d. Corrugating
_________________________________________________________________________________
_________________________________________________________________________________
e. Others
_________________________________________________________________________________
_________________________________________________________________________________
3. Production
a. Forming
_________________________________________________________________________________
_________________________________________________________________________________
b. Apprentice Programs
_________________________________________________________________________________
_________________________________________________________________________________
c. Batch and Furnace
_________________________________________________________________________________
_________________________________________________________________________________
d. Mold Repair
_________________________________________________________________________________
_________________________________________________________________________________
*92
e. Machine Repair
_________________________________________________________________________________
_________________________________________________________________________________
f. Others
_________________________________________________________________________________
_________________________________________________________________________________
EXHIBIT B
SALARIED JOB APPLICATION
JOB APPLIED FOR: ________________________________________________________________________
1. NAME: CLOCK #:
2. DATE OF HIRE WITH O-I:
3. CURRENT JOB AND SHIFT:
4. HAVE YOU READ THE JOB DESCRIPTION FOR THIS JOB?
5. DESCRIBE BRIEFLY ANY EDUCATION, TRAINING OR WORK EXPERIENCE
WHICH YOU THINK QUALIFIES YOU FOR THIS POSITION:
Date:
_______________________________________
Signature
EXHIBIT C
LEGAL NOTICE
TO: All females who were employed at the Oakland Plant of Owens-Illinois, Inc. since March 23, 1974.
On March 15, 1979, the United States District Court for the Northern District of California determined that from March 23, 1974 until January 8, 1979 Owens-Illinois, Inc. ("Owens-Illinois"), at its Oakland Plant, discriminated against its female employees on account of their sex by unduly limiting the initial hiring of women for management training positions and unduly limiting the promotion of women to supervisory and management level positions. You may have been affected by such discrimination.
Injunctive relief has been granted in the Remedial Order Re Class of Female Employees which is enclosed with this Notice. You should carefully study the provisions of the Remedial Order, and you should seek explanation of its terms if you are uncertain of its effect on you or your job.
Court proceedings will be held to determine whether any of you are entitled to back pay. To be entitled to back pay you must show that but for Owens-Illinois, Inc.'s discrimination against you during the period from March 23, 1974 to January 8, 1979, in refusing you management training, or refusing you a promotion to a supervisory or management level position on account of your sex, you would have a better job, or have earned more money than you did, in fact, earn. To be entitled to back pay, you must show that with respect to some job vacancy.
(1) You applied for that vacancy
or
You would have applied for that job but you were deterred from applying because you believed a Company policy made your applying a useless act because you are a woman;
(2) You were qualified for the job
*93 (3) You did not receive the job; and
(4) The job was awarded to a male.
Owens-Illinois can rebut your claim of discrimination by showing that it did not award you the vacant job for non-discriminatory reasons, for example, because a more qualified applicant was available. If Owens-Illinois makes such a showing you must then prove that the reason Owens-Illinois gave for not selecting you was a mere pretext, that is, that it was not the true reason for denying you the job and that the true reason was because of your sex.
In order to present a claim for back pay you must complete the attached Claim form and return it to the address shown below by no later than [date 30 days from notice].
Floyd Williams, et al. v. Owens-Illinois, Inc.
Clerk, United States District Court
Federal Office Building
450 Golden Gate Avenue
San Francisco, California 94102
If you do not return the Claim form, any claim to back pay which you may have as the result of discrimination on account of your sex by Owens-Illinois during the period March 23, 1974-January 8, 1979, will be waived, and when the final decree and judgment is entered in this case, you will be bound by that judgment whether or not you received a back pay award.
You are entitled to have an attorney represent you in these proceedings. You may choose to be represented by your own attorney. Otherwise, the plaintiffs' attorneys will represent you if you wish them to do so. They are the firm of Withy, Gould, Miller & Gertsler, 2222 Grove Street, Berkeley, California 94704. You may consult these attorneys for information regarding this case or any claim you may have in connection with it.
EXHIBIT D
CLAIM
1. Name:
2. Social Security Number:
3. Owens-Illinois Identification Number:
4. Date first employed by Owens-Illinois:
5. If employment not continuous,
(a) list any break(s) in service:
(b) list any re-employment dates:
6. List each specific job vacancy(ies) for which you believed yourself qualified:
7. List your qualifications for each such job vacancy:
8. For such job, list
(a) when you believe you were qualified for that job:
(b) the date when you applied or otherwise sought to be selected (If you did not apply, explain why):
(c) the result or response from Owens-Illinois:
(d) the name and sex of the person who was selected for that job, if you know:
(e) your supervisor at the time you applied for or sought the position:
9. If you are no longer employed by Owens-Illinois, list all jobs held since you left Owens-Illinois including:
(a) employer;
(b) employment dates;
(c) job title and description;
(d) pay (including all increases, fringe benefits and other compensation), and
(e) reason for leaving.
If you have not held a job since you left Owens-Illinois explain why not.
I declare under penalty of perjury that the above statements are true and correct.
Dated:
__________________________
Name
__________________________
Address
__________________________
NOTES
[1] The term "supervisory/management positions" as used herein shall be defined to include all management training positions, including but not limited to the position of student industrial engineer in the cost control department; all crew leaders and working foremen, union or non-union, who are responsible for supervising the work of one or more other persons, including but not limited to relief foremen and like foremen positions; and any other positions where the employee is responsible for supervising one or more employees in their work, but shall exclude the top five positions at the Oakland plant. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1011055/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4967
GREGORY ALLEN SCHNEIDER,
Defendant-Appellant.
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4968
GREGORY ALLEN SCHNEIDER,
Defendant-Appellant.
Appeals from the United States District Court
for the District of South Carolina, at Columbia.
Joseph F. Anderson, Jr., Chief District Judge.
(CR-98-522, CR-98-1116)
Submitted: May 20, 2003
Decided: July 7, 2003
Before WIDENER, MICHAEL, and SHEDD, Circuit Judges.
Affirmed by unpublished per curiam opinion.
COUNSEL
Katherine E. Evatt, Assistant Federal Public Defender, Columbia,
South Carolina, for Appellant. Dean Arthur Eichelberger, OFFICE
2 UNITED STATES v. SCHNEIDER
OF THE UNITED STATES ATTORNEY, Columbia, South Caro-
lina, for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
In these consolidated appeals, Gregory Allen Schneider appeals
concurrent eight-month sentences he received for his second violation
of two terms of supervised release imposed for two separate offenses
to which he pled guilty in 1999. Schneider’s attorney has filed a brief
pursuant to Anders v. California, 386 U.S. 738 (1967), in which she
certifies there are no meritorious issues for appeal. Schneider,
informed of his right to file a supplemental pro se brief, has not done
so. Because we find no plain error in Schneider’s sentence, for the
following reasons, we affirm.
Although not asserted by counsel, our review of the record pursu-
ant to Anders indicates Schneider should not have received a sentence
for again violating a term of supervised release predicated on his con-
viction for impersonating a federal officer, which is a Class E felony.
See 18 U.S.C. §§ 912, 3559(a)(5) (2000) (imposing a maximum of
three years’ incarceration for impersonating a federal officer and clas-
sifying offenses with less than five years maximum incarceration as
Class E felonies, respectively). When Schneider violated the initial
term of supervised release imposed for that conviction, a ten-month
custodial sentence was imposed. His service of that period of confine-
ment limited any subsequent term of supervised release to two
months. See 18 U.S.C. § 3583(h) (2000); see also United States v.
Maxwell, 285 F.3d 336, 341 (4th Cir. 2002). Consequently, because
the activity underlying Schneider’s most recent supervised release
violation occurred approximately six to eight months after any addi-
tional supervised release related to his § 912 conviction should have
UNITED STATES v. SCHNEIDER 3
concluded, Schneider should not have received an additional eight
months’ incarceration with respect to that conviction.
Nevertheless, we conclude there was no plain error, as Schneider
would have received an eight-month custodial sentence in any event.
We find no error in the district court’s imposition of a concurrent
eight-month post-revocation sentence related to Schneider’s convic-
tion under 18 U.S.C. § 1341 (2000) for mail fraud, as Schneider stipu-
lated to violating the conditions of his supervised release for that
conviction, and the district court was apprised of the recommended
sentencing ranges in fixing Schneider’s sentence. See United States v.
Davis, 53 F.3d 638, 642 (4th Cir. 1995). Because the foregoing error
did not in fact increase the term of incarceration imposed, the error
did not affect his substantial rights, and thus does not amount to plain
error. See United States v. Angle, 254 F.3d 514, 518 (4th Cir.) (en
banc), cert. denied, 534 U.S. 937 (2001).
We have reviewed the entire record in this case in accordance with
Anders and have found no meritorious issues for appeal. We therefore
affirm Schneider’s sentences. This court requires that counsel inform
his client, in writing, of his right to petition the Supreme Court of the
United States for further review. If the client requests that a petition
be filed, but counsel believes that such a petition would be frivolous,
then counsel may move in this court for leave to withdraw from repre-
sentation. Counsel’s motion must state that a copy thereof was served
on the client. We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
AFFIRMED | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1011074/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 02-6710
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
ALFRED GREEN,
Defendant - Appellant.
Appeal from the United States District Court for the District of
Maryland, at Baltimore. Catherine C. Blake, District Judge. (CR-
98-478-CCB, CA-00-1335-CCB)
Submitted: June 30, 2003 Decided: July 17, 2003
Before KING and SHEDD, Circuit Judges, and HAMILTON, Senior Circuit
Judge.
Dismiss by unpublished per curiam opinion.
Alfred Green, Appellant Pro Se. Donna Carol Sanger, OFFICE OF THE
UNITED STATES ATTORNEY, Greenbelt, Maryland, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Alfred Green seeks to appeal the district court's ruling
construing Green’s self-described Fed. R. Civ. P. 60(b) motion as
a motion to vacate under 28 U.S.C. § 2255 (2000), and dismissing it
as successive. This Court may grant a certificate of appealability
only if the appellant makes a substantial showing of the denial of
a constitutional right. 28 U.S.C. § 2253(c)(2) (2000). Where, as
here, a district court dismisses a motion to vacate 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.)
(quoting Slack v. McDaniel, 529 U.S. 473, 484 (2000)), cert.
denied, 534 U.S. 941 (2001). We have independently reviewed the
record and conclude that Green has not satisfied either standard.
See Miller-El v. Cockrell, 537 U.S. 322 (2003).
We must construe Green’s notice of appeal and informal brief
on appeal as an application to file a second or successive motion
to vacate under 28 U.S.C. § 2255. See United States v. Winestock,
F.3d , 2003 WL 1949822, at *7 (4th Cir. Apr. 25, 2003). In
order to obtain authorization to file a second motion to vacate, a
movant must assert claims based on either: (1) a new rule of
2
constitutional law, previously unavailable, made retroactive by the
Supreme Court to cases on collateral review; or (2) newly
discovered evidence that would be sufficient to establish by clear
and convincing evidence that no reasonable fact-finder would have
found the movant guilty of the offense. 28 U.S.C. § 2244(b).
Green’s claims do not satisfy either of these conditions.
Therefore, we decline to authorize Green to file a successive
§ 2255 application.
We deny a certificate of appealability and dismiss the appeal.
We dispense with oral argument because the facts and legal
contentions are adequately presented in the materials before the
court and argument would not aid the decisional process.
DISMISSED
3 | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1918570/ | 764 A.2d 101 (2000)
CITY OF PITTSBURGH, Appellant,
v.
FRATERNAL ORDER OF POLICE FORT PITT LODGE NO. 1.
Commonwealth Court of Pennsylvania.
Argued November 1, 2000.
Decided December 15, 2000.
Hugh F. McGough, Pittsburgh, for appellant.
Michael S. Sherman, Pittsburgh, for appellee.
Before COLINS, Judge, LEADBETTER, Judge, and McCLOSKEY, Senior Judge.
COLINS, Judge.
The City of Pittsburgh appeals the order of the Court of Common Pleas of Allegheny *102 County affirming the decision of an arbitration panel to decline jurisdiction and rescind the termination of city police officer Donald Mitchell without a hearing on the merits on the ground that the Act 111[1] arbitration hearing did not take place within 45 days of the request for arbitration as required under the terms of the collective bargaining agreement.
The City discharged Officer Mitchell effective December 22, 1998 after he admitted to stealing $835 from an unoccupied vehicle and failing to submit a report on the vehicle.[2] Officer Mitchell, through the Fraternal Order of Police Fort Pitt Lodge No. 1 (FOP), filed a grievance and requested review by a panel of arbitrators. By letter dated December 30, 1998, the City notified David Petersen that he had been chosen as the neutral arbitrator and requested that he submit available dates "in January or early February" for the arbitration hearing. Arbitrator Petersen (the arbitrator) suggested a hearing date of February 15, 1999, and the parties accepted that date.[3]
At the February 15 hearing, both sides raised procedural objections pertaining to the panel's jurisdiction, and the panel heard argument on the objections. Pertinent to this appeal are the objections of Mitchell and the FOP that the hearing was untimely because it was held beyond the 45-day period set forth in Section 19-8 of the collective bargaining agreement (CBA).[4] Before recessing to consider the objections, arbitrator Petersen advised the parties that according to the panel's understanding, if the City's objection was sustained, Mitchell's discipline would be final and not subject to further appeal, if the FOP's objection was sustained, the discipline would be rescinded and if both objections were denied, the hearing would be reconvened. (Board of Arbitration decision, p. 2.) Neither party objected to the arbitrator's characterization of the issues. Id. The panel refused to consider additional arguments or evidence submitted after the hearing recessed. (Board of Arbitration decision, p. 2 fn.2.)
The arbitrators sustained the FOP's timeliness objection. It concluded that under the terms of Section 19-8 the arbitration hearing must be held within 45-days after the request for arbitration, and that the 45-day period should be measured in calendar days rather than working days based on the CBA's use of both "working days" and "days" when describing two different time periods in Section 19-8. The panel rejected the City's contention that the FOP's failure to object to the arbitrator's suggestion of February 15, 1999 as the date for the hearing constituted a waiver of the 45-day limitation. In so doing, the panel noted that based on representations at the hearing, the City had refused to recognize the FOP president or its counsel as having the authority to waive Section 19 time limits on behalf of a disciplined officer, and that it was undisputed that Officer Mitchell did not waive the time limits. The panel also noted that the City's letter requesting hearing dates did not request a date within a 45-day period. The trial court dismissed the City's petition to review and vacate the arbitrator's award, and it affirmed the arbitrators' decision.
*103 On appeal to Commonwealth Court, the City argues: 1) the City has a contractual right to proceed to arbitration on the merits; and 2) the arbitrator's acceptance of the timeliness objection after accepting the parties' consent to proceed with the hearing on February 15 resulted in an irregularity in the proceeding. In appeals of an Act 111 grievance arbitration, our scope of review is narrow certiorari, which permits an appellate court to consider 1) the arbitrator's jurisdiction; 2) the regularity of the proceedings; 3) an excess of the arbitrator's powers; or 4) deprivation of constitutional rights. Pennsylvania State Police v. Pennsylvania State Troopers Association (Smith), 559 Pa. 586, 741 A.2d 1248 (1999) (citing Pennsylvania State Police v. Pennsylvania State Troopers' Association (Betancourt), 540 Pa. 66, 656 A.2d 83 (1995)). An error of law alone is not sufficient to support a reversal of an arbitrator's award. Id. An appellate court may not disregard an arbitrator's findings of fact or contract interpretation if the arbitrator is even arguably construing or applying the contract and acting within the scope of his or her authority. City of Philadelphia v. Fraternal Order of Police, Lodge No. 5, 720 A.2d 811 (Pa.Cmwlth.1998).
First, the City argues that the arbitrator erred when it concluded that it lacked jurisdiction to hear this matter on the merits. In essence, this argument disputes the arbitrator's interpretation of the terms of the CBA and its application of those terms. The City argues that the parties satisfied the terms of Section 19-8 when they requested a hearing date in January or early February and subsequently agreed to proceed with the hearing on February 15, 1999. It further argues that unlike the unambiguous time limitations set forth in Sections 19-2 through 19-7, the forty-five day period in Section 19-8 is not assigned to either party; therefore the arbitrator lacked the authority under the CBA to rescind the discipline on the ground that the City, as employer, failed to comply with the time limit.
An arbitrator acts within the scope of its authority in determining its own jurisdiction. Township of Sugarloaf v. Bowling, 563 Pa. 237, 759 A.2d 913 (2000). In concluding that it did not have jurisdiction, the arbitrator interpreted Section 19-8 of the CBA to provide that the hearing before the panel of arbitrators must take place within forty-five calendar days after the employee requests arbitration. Because the hearing did not take place within 45 calendar days in this case, the arbitrator applied Section 19-10 of the CBA and ruled that the discipline was rescinded.
Section 19-8 of the CBA[5] provides in pertinent part,
The arbitrator will be notified of the days within a forty five day period on which the Parties will be available for an arbitration hearing. In addition, the panel arbitrators shall be notified that the Arbitration Board's decision must be issued in writing within five working days of the hearing, and a supporting opinion, if one is requested, may be issued within thirty days of the hearing.
Section 19-10 states, "If the Employer does not comply with any of the time limits specified above, the disciplinary action will be rescinded." As set forth in detail above, the arbitrator's conclusion on this issue is based on a reasonable interpretation of the contract language and a rational analysis of the contract's distinction between "working days" and "days," the latter of which it interpreted to mean calendar days. As such, regrettably, we may *104 not disregard the arbitrator's interpretation of the CBA or its application, despite the unpalatable result.[6]
Next, the City argues that the arbitrator's award in this case may be set aside because the arbitrator's consideration of the FOP's timeliness objection after the parties consented to proceed on February 15, 1999 constituted an irregularity in the proceeding. The City cites no authority for the proposition that the arbitrator's entertaining the FOP's objection to the timeliness of the hearing constitutes an irregularity in the proceeding. The FOP presented its objection at its first opportunity, and the arbitrator rejected the City's contention that the issue had been waived. The arbitrator noted that the City made an open request for a hearing date rather than requesting a date within a specified 45-day period. It found that Officer Mitchell had not waived the limitation and that based on representations made at the hearing, the City had previously refused to recognize the authority of FOP counsel to waive time limits on the grievant's behalf.
The arbitrator's consideration of the FOP's procedural objection does not constitute an irregularity in the proceeding. The arbitrator reasonably interpreted the terms of the CBA to place the burden of complying with the 45 day limit on the City; and we may not disregard its finding that Officer Mitchell did not waive the timeliness issue.
Accordingly, the order of the court of common pleas is affirmed.
ORDER
AND NOW, this 15th day of December 2000, the order of the Court of Common Pleas of Allegheny County is affirmed.
LEADBETTER, Judge, concurring.
I respectfully disagree with the majority's conclusion that the arbitrator's interpretation of the CBA in this case was reasonable. Indeed, I believe it was manifestly unreasonable. However, I agree that this issue is outside our scope of review, and therefore that we must affirm the order of the court of common pleas.
NOTES
[1] Act of June 24, 1968, P.L. 237, as amended, 43 P.S. §§ 217.1-217.10. Act 111 pertains to collective bargaining by police and firefighters.
[2] Mitchell subsequently pleaded guilty to federal charges of stealing the money in the course of his employment.
[3] Nothing in the record documents "acceptance" of this date. The City alleges that the parties accepted the date, and the parties appeared before the panel on that date.
[4] The City objected that no written grievance had been filed as required under Section 19-6 of the CBA. The panel ruled that the FOP "timely filed with the City a writing" that conveyed Mitchell's intent to appeal the discipline and to arbitrate the dispute and that the writing fulfilled the requirements of Section 19-6 of the CBA.
[5] The Police Discipline Procedures in the CBA governing this matter are reproduced as Exhibit 2 attached to the FOP's petition to vacate the arbitrator's award filed with the trial court.
[6] See Pennsylvania State Police v. Pennsylvania State Troopers Association (Smith), 698 A.2d 688 (Pa.Cmwlth.1997), affirmed, 559 Pa. 586, 741 A.2d 1248 (1999) (reinstated trooper who after drinking heavily pulled his service revolver and threatened to blow a woman's head off); Pennsylvania State Police v. Pennsylvania State Troopers Association (Johnson), 698 A.2d 686 (Pa.Cmwlth.1997) affirmed, 559 Pa. 586, 741 A.2d 1248 (1999) (trooper reinstated after retail theft); Pennsylvania State Police v. Pennsylvania State Troopers' Association (Betancourt), 540 Pa. 66, 656 A.2d 83 (1995) (trooper reinstated after exposing his penis while on duty at troop headquarters during conversation with other troopers). Most particularly in Smith, we were bound to uphold the arbitrator's award of reinstatement even where we found it "incomprehensible" that an arbitrator would find no just cause for dismissal after such apparently egregious conduct. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2858969/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-94-008-CV
RAILROAD COMMISSION OF TEXAS; MARTHA WHITEHEAD, SUCCESSOR
TO KAY BAILEY HUTCHISON, TREASURER OF TEXAS;
AND DAN MORALES, ATTORNEY GENERAL OF TEXAS,
APPELLANTS
vs.
WESTAR TRANSMISSION COMPANY,
APPELLEE
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 345TH JUDICIAL DISTRICT
NO. 91-6105, HONORABLE F. SCOTT McCOWN, JUDGE PRESIDING
PER CURIAM
The parties have filed a joint motion for an agreed final order. The motion is
granted. Tex. R. App. P. 59(a)(1)(A).
The judgment of the district court is set aside, and the cause is remanded for entry
of judgment in accordance with the agreement of the parties.
Before Justices Powers, Aboussie and Jones
Judgment Set Aside and Cause Remanded for Entry of Judgment on Joint Motion
Filed: April 13, 1994
Do Not Publish | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1582477/ | 31 So. 3d 873 (2010)
John HERNANDEZ, Appellant,
v.
STATE of Florida, Appellee.
No. 4D08-2872.
District Court of Appeal of Florida, Fourth District.
March 17, 2010.
Rehearing Denied April 27, 2010.
*874 Samuel R. Halpern, Fort Lauderdale, for appellant.
*875 Bill McCollum, Attorney General, Tallahassee, and Melanie Dale Surber, Assistant Attorney General, West Palm Beach, for appellee.
POLEN, J.
Appellant, John Hernandez, appeals his convictions and sentences for two counts of lewd or lascivious molestation and one count of lewd or lascivious exhibition. First, he contends that the trial court erroneously permitted the State to call witness Sherill Hernandez for the sole purpose of introducing otherwise inadmissible impeachment evidence, which highly prejudiced appellant. Second, appellant claims error by the trial court in assessing points for victim contact pursuant to Blakely v. Washington, 542 U.S. 296, 124 S. Ct. 2531, 159 L. Ed. 2d 403 (2004), where the verdict form did not have a separate interrogatory for sexual contact. Although we must reverse for a new trial on the first issue, we also address appellant's sentencing issue, should this matter arise again.
Appellant was charged in Counts 1 and 2 with the lewd or lascivious touching of P.M.'s breast/genital area, or the clothing covering the breast/genital area, on one or more occasions, between October 31, 1999 and March 31, 2004. Count 3 alleged that on one or more occasions during the same time frame, appellant exposed his genitals to P.M. in a lewd or lascivious manner. P.M. was twelve years old when the alleged conduct began.
Appellant's wife, Sherill Hernandez, was P.M.'s cousin. P.M. referred to Sherill and appellant as aunt and uncle. During the time period in question, P.M. and her two younger sisters would sleep over at the Hernandez home every other weekend or so. It was during these weekends that the alleged molestation occurred.
P.M. described two incidents. In the first, she was sleeping in her cousin Jonathan's bedroom on the floor. Appellant entered the room and asked P.M. if she was awake and wanted to watch a movie with him in the living room. P.M. said okay and went into the living room with appellant. When she got cold, appellant put her on his lap. Appellant began to push her down onto his lap and began to grind his penis against her "butt" and genital area. Appellant then lowered his pants, unbuttoned P.M.'s "jumper dress" and continued to grind against her. P.M. still had her shirt and underwear on. She could see appellant's penis. When P.M. cried, appellant stopped and put her back in the other room. Another time, appellant entered the bedroom where P.M. slept, picked her up off the bed, laid her down on the floor and then laid on top of her. Appellant then began to grind against P.M., kiss her neck and touch her breast. Initially, P.M. testified that appellant touched her "naked" breast. Later, she testified that appellant never touched her underneath her clothes, although he attempted to do so.
The incidents occurred in the early morning hours when the house was dark and the rest of the family was asleep. P.M. said she screamed during the incident(s), but "never ... to the point where the whole house could hear [her]." The incidents all blurred together and P.M. did not know how many times appellant did this to her. P.M. did not make the allegations until she was eighteen years old, two years after the incidents had stopped. She first told her cousin, Sashana,[1] and then later, her mother, while in the car with Sashana. Upon hearing the allegations, P.M.'s mother drove straight over to the Hernandez residence. When appellant came to the door, he got down on his *876 knees, said, "I'm sorry," and asked for forgiveness. However, P.M.'s mother did not confront appellant with any specific allegations.
Later that day, P.M. went to the police station where she agreed to make a recorded phone call to appellant. The tape began with a conversation between appellant and P.M., and ended with a conversation between P.M. and Sherill Hernandez. Initially, the parties agreed that only the conversation between P.M. and appellant would be admitted as evidence. That section of the tape, which follows, was published at the end of the State's case, and without objection:
Unknown male: Hello.
P.M.: Hey, is Uncle John there?
Unknown male: One second.
P.M.: All right.
Male: Hello.
P.M.: Hello.
Male: Yeah.
P.M.: John?
Male: Yes.
P.M.: It's P.M.
Male: Hi, P.M.
Male: Forgive me.
P.M.: I can't.
Male: Huh?
P.M.: I can't. I just want to know why. Hello.
Male: I'm sorry, P.M.
P.M.: Uncle John, why?
Male: Can you, can you just forgive me?
P.M.: No, I just want to know why you were touching me? Why did you do this? Why?
Male: (No audible response).
P.M.: Can you please answer me? Hello. Answer me.
Male: I have to go.
P.M.: No, you don't have to go.
Male: I'm sorry, P.M.
P.M.: Hello.
Male: I'm sorry.
P.M.: I deserve the right to know why.
(Thereupon the tape was stopped).
After appellant spoke to P.M., the phone was passed to Sherill Hernandez. Sherill and P.M. then had a conversation, in which Sherill indicated that appellant had confessed to her.
The State called Sherill Hernandez over appellant's objection that the witness was being called for the sole purpose of impeaching her with the transcript of the controlled call. The defense advised that the witness had told defense counsel she was going to deny that appellant had ever confessed to her. The prosecutor responded: "I don't know what she's going to come in and say. My only good faith basis is that she is on tape making statements that her husband has admitted this molestation to her specifically." Defense counsel noted that the State had never deposed the witness.
Before Sherill testified, a proffer was taken and the tape was played for her with the aid of a transcript. Sherill recognized her voice on the tape and recalled part of the phone call, but could not understand what she was saying because "it was very difficult to hear."
Later, when she testified before the jury, Sherill denied that appellant had admitted to molesting P.M. and said that neither the tape nor the transcript refreshed her memory. When asked whether she recalled telling P.M. that appellant told her he did these things because he "wasn't psychologically well," Sherill said: "I may have said it, I don't remember." She later said, "he never said that." Sherill said she must have been referring to the person that molested her (Sherill) as a child. After the tape was played for her *877 again, outside of the jury's presence, Sherill testified that hearing her voice did not refresh her recollection about what was said in the conversation.
After extensive argument and objections, the court ruled that Sherill and P.M.'s taped conversation would be admitted as past recollection recorded. Appellant objected to the tape being admitted under that exception to the hearsay rule, citing a lack of predicate or foundation.
After Sherill's testimony, the conversation in its entirety was published to the jury:
Female: Hello.
P.M.: Hello?
Female: Hello.
P.M.: Hello?
Female: P.M.
P.M.: Hi.
Female: I'm sorry, baby.
P.M.: No, no, no. From when I was little. I was twelve years old and you knew.
Female: I did not know, I had no idea.
P.M.: He's your husband.
Female: I did not know.
P.M.: I'm your family, not him, me.
Female: I know.
P.M.: I'm blood, you're married to him.
Female: I know baby. I did not know, P.M. I did not know. I'm so sorry.
P.M.: I will never forgive nobody, never. The stuff I've been through, never. Can you please tell me, Uncle John?
Female: (Inaudible).
P.M.: Is he on the phone?
Female: No, he's not in the room.
P.M.: Can you just put him on the phone? I just want to know why. Hello.
Female: P.M.
P.M.: I just want to know why he touched my vagina, my breasts and he made me sit on him, can you, just please. I'm at an age, I'm grown, can somebody please
Female: I know, I asked him why he did all of that, and that's what he said, psychologically he wasn't well.
P.M.: Well, him and his psychological problems need to tell me why he did this to me.
Female: P.M. he said psychologically he wasn't well and (inaudible) he's sorry.
P.M.: Auntie, I have to talk to him, please.
Female: (Inaudible) P.M., I'm sorry, I had noif I knew I would have done the same thing, some relative or cousin did the same thing, I understand what you're going through.
P.M.: Okay, Auntie, are you going to put him on the phone?
Female: Are you tape recording this, P.M.?
P.M.: No.
Female: Where are you calling from? P.M.: I'm at my friend's house.
Female: (Inaudible) I know, I just (inaudible) I'm in so much pain right now. Travis, please don't pick up the phone.
P.M.: Well, I tried, all I wanted was an answer, so, I
Female: I know
P.M.: I don't want to hear it from you, you didn't do it, he did it, I wanted to hear it from him. Well, I got to go.
Female: P.M.
P.M.: I'm sorry, I got to go.
Female: P.M. P.M.
P.M.: Bye.
(Thereupon, the tape was stopped.)
Appellant argues that the trial court reversibly erred in allowing the State to call *878 Sherill Hernandez as a witness for the sole purpose of impeaching her with this inadmissible hearsay evidence. The State responds that the taped statement was admissible as a past recollection recorded, and alternatively, any error was harmless. We agree with appellant and reverse.
The standard of review on the admission of evidence is abuse of discretion as limited by the rules of evidence. Hudson v. State, 992 So. 2d 96, 107 (Fla.2008). Unless it falls within a statutory exception, hearsay evidence is inadmissible. See § 90.802, Fla. Stat. (2008).
Section 90.803(5), Florida Statutes (2008), provides an exception to the hearsay rule when a witness cannot recall matters of which he or she previously had knowledge.[2] If the proper foundation is laid, a tape-recorded statement may qualify as a recorded recollection. See Montano v. State, 846 So. 2d 677, 680-81 (Fla. 4th DCA 2003). To be admitted into evidence, the past recollection recorded must be offered by the witness who is either devoid of a present recollection, or possessed of an imperfect present recollection and desires to use a memorandum of a past recollection. See Kimbrough v. State, 846 So. 2d 540, 543 (Fla. 4th DCA 2003); § 90.803(5). "The witness must be able to assert now that the record correctly represented his knowledge and recollection at the time of making." Kimbrough, 846 So.2d at 543 (citing J. Wigmore, Evidence §§ 734, 746(2) (Chadbourne rev. 1970)); see also Montano, 846 So.2d at 681-82 (witness's tape-recorded statement given to police shortly after criminal incident was improperly admitted under recorded recollection exception to hearsay rule where witness did not acknowledge its accuracy at trial).
Here, Sherill Hernandez was unable, or unwilling, to attest to the accuracy of the taped conversation. As such, the State was not able to show it could introduce the document as a "past recollection recorded." Sherill testified definitively that appellant denied abusing P.M. This directly conflicts with the conversation on the tape. Sherill also denied that appellant had offered an explanation to her for abusing P.M., i.e., that he was not mentally or psychologically well. She testified that the tape did not refresh her recollection.
Section 90.608(1), Florida Statutes, states that "[a]ny party, including the party calling the witness, may attack the credibility of a witness by ... [i]ntroducing statements of the witness which are inconsistent with the witness's present testimony." However, the supreme court in Morton v. State, 689 So. 2d 259 (Fla.1997), receded from on other grounds, Rodriguez v. State, 753 So. 2d 29 (Fla.2000), has recognized the risk of abuse where a prosecutor calls a witness who has previously given a statement implicating the defendant but who has since repudiated that statement. Bateson v. State, 761 So. 2d 1165, 1169 (Fla. 4th DCA 2000). "[W]here a prosecutor knows that the witness' testimony at trial will be favorable to the defendant but, nonetheless, calls the witness for the purpose of impeaching [her] with [her] prior statement, the practice may be *879 considered abusive because `there is no legitimate forensic purpose in calling a witness solely to impeach him.'" Id. (emphasis added.) Recognizing that a single rule could not be created to encompass all of the circumstances in which a party will seek to impeach her own witness, the court stated: "Generally ... if a party knowingly calls a witness for the primary purpose of introducing a prior statement which otherwise would be inadmissible, impeachment should ordinarily be excluded." Morton, 689 So.2d at 264.
In determining whether a party calls a witness for the primary purpose of impeachment, courts may consider "(1) whether the witness's testimony surprised the calling party, (2) whether the witness's testimony affirmatively harmed the calling party, and (3) whether the impeachment of the witness was of de minimis substantive value." Senterfitt v. State, 837 So. 2d 599, 600 (Fla. 1st DCA 2003).
Recently, this court adopted the Third District's expanded explanation of the "primary purpose" analysis in State v. Richards, 843 So. 2d 962 (Fla. 3d DCA 2003), which noted that the witness's other testimony must be useful to prove a significant fact in the litigation:
Application of the "mere subterfuge" or "primary purpose" doctrine focuses on the content of the witness's testimony as a whole. If the witness's testimony is useful to establish any fact of consequence significant in the contest of the litigation, the witness may be impeached by means of a prior inconsistent statement as to any other matter testified to. In the words of one commentator, the pivotal question is whether the "party [is] calling a witness with the reasonable expectation that the witness will testify [to] something helpful to the party's case aside from the prior inconsistent statement."
Ruff v. State, 31 So. 3d 833, 837 (Fla. 4th DCA 2010) (quoting Richards, 843 So.2d at 965 (emphasis omitted) (quoting 1 McCormick on Evidence § 38, at 142-43 (John W. Strong ed., 5th ed. 1999)).
In the instant case, a review of Sherill's entire trial testimony reflects that it was useful only for the introduction of her prior inconsistent statements. First, we find the absence of the "surprise" factor. The State had never deposed Sherill, and the record reflects that the prosecutor had not even spoken with the witness prior to trial. Moreover, defense counsel specifically advised the State and trial court that Sherill had told defense counsel she was going to deny that appellant ever admitted to the allegations or that he had offered an explanation for doing so. During the initial proffer, the witness recognized her voice on the tape and recalled part of the phone call, but could not make out what she was saying. At the very least, then, the State should have been alerted to the possibility that Sherill's trial testimony would be favorable to appellant. The State could and should have requested a brief recess to interview or depose the witness. Sherill's testimony did, in fact, affirmatively harm the prosecution, because it directly opposed the point the State was trying to prove; namely, that appellant had confessed to his wife. The impeachment was not of de minimis value to the State because none of the State's other witnesses had testified that appellant admitted to the allegations. The only other evidence Sherill offered concerned the relationship between the families, appellant's age, and that P.M. was often an overnight houseguest in the Hernandez home. This testimony was either cumulative to that of the other witnesses or undisputed. "Paraphrasing McCormick, the prosecutor did not call [Sherill Hernandez] with any reasonable expectation that she *880 would testify to something helpful to his case, aside from the prior inconsistent statement." Ruff, 31 So.3d at 838.
We cannot say beyond a reasonable doubt that the admission of the tape, containing Sherill's prior inconsistent statements, did not contribute to the jury's verdict. See State v. DiGuilio, 491 So. 2d 1129, 1138 (Fla.1986). This is so despite the trial court's cautionary instruction(s).[3] "The pertinent question in a harmless error analysis is not the sufficiency or quality of the remaining, properly admitted evidence; rather, it is `whether there is a reasonable possibility that the error affected the verdict.'" Chavez v. State, 25 So. 3d 49, 54 (Fla. 1st DCA 2009) (citing DiGuilio, 491 So.2d at 1139); see also Ventura v. State, 29 So. 3d 1086, 1089 (Fla. 2010) (reiterating that the harmless error test is "not a sufficiency-of-the-evidence, a correct result, a not clearly wrong, a substantial evidence, a more probable than not, a clear and convincing, or even an overwhelming evidence test." (citing DiGuilio, 491 So.2d at 1139).
The subject conversation revealed the only admission of guilt by appellant, gave credence to the victim's testimony, and provided an explanation for appellant's non-specific requests for forgiveness, first to P.M.'s mother and later, to P.M. It was highly damaging and prejudicialparticularly, where the victim did not report the alleged conduct until two years after it had stopped and the State presented no physical evidence or corroborating witness testimony.
For the foregoing reasons, we reverse for a new trial.
We now comment on the sentencing issue in the event it becomes an issue following remand.
During sentencing, the defense objected to the points assessed for victim contact, pursuant to Blakely v. Washington, 542 U.S. 296, 124 S. Ct. 2531, 159 L. Ed. 2d 403 (2004). Counsel argued that the sexual contact points should not be included in the scoresheet calculation because the verdict form did not have a separate interrogatory for sexual contact. The State successfully argued that the victim contact inheres in the verdict and no separate jury determination was required. Accordingly, the trial court assessed sexual contact points for the two counts of lewd or lascivious molestation.
Appellant argues that sexual contact did not inhere in the verdict because the testimony was ambiguous as to whether appellant touched the clothing covering the breast or genital area or the flesh itself. Appellant correctly asserts that sexual contact is not defined in the applicable statutes. However, our courts have upheld sexual contact victim injury points in instances where the offender touched clothed sexual parts of the victim. See Altman v. State, 852 So. 2d 870 (Fla. 4th DCA 2003) (holding that appellant's act of lying on top of the victim with his clothed genitals pressed against hers and "humping" her constituted sexual contact for which victim injury points were appropriately scored); see also Fredette v. State, 786 So. 2d 27, 28 n. 2 (Fla. 5th DCA 2001) (holding that sexual contact includes touching a child's vaginal area, and opined that this would constitute sexual contact even if the touching was over the child's clothing); Louis v. State, 764 So. 2d 930 (Fla. 4th DCA 2000) (holding that touching the victim's chest through her shirt, along with touching her stomach and genital area, involved sexual contact for which victim *881 injury points were properly scored); State v. Milanes, 762 So. 2d 572, 573 (Fla. 5th DCA 2000) ("victim injury points can be assessed when the accused is adjudicated guilty of fondling the victim"); Mackey v. State, 516 So. 2d 330, 330-31 (Fla. 1st DCA 1987) (affirming victim injury points for sexual contact where defendant fondled a thirteen-year-old boy by touching him above the crotch).
We therefore find the sentencing issue to be without merit.
Reversed and Remanded.
WARNER and STEVENSON, JJ., concur.
NOTES
[1] Sashana was not called to testify at trial by either party.
[2] (5) RECORDED RECOLLECTION. A memorandum or record concerning a matter about which a witness once had knowledge, but now has insufficient recollection to enable the witness to testify fully and accurately, shown to have been made by the witness when the matter was fresh in the witness's memory and to reflect that knowledge correctly. A party may read into evidence a memorandum or record when it is admitted, but no such memorandum or record is admissible as an exhibit unless offered by an adverse party.
§ 90.803(5), Fla. Stat. (2008).
[3] The trial court gave the jury a limiting instruction both at the time the tape was played, and later, in the final charge to the jury. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1651019/ | 37 So. 3d 853 (2010)
MOORE
v.
STATE.
No. 1D10-0728.
District Court of Appeal of Florida, First District.
June 16, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582318/ | 976 F.Supp. 1212 (1997)
Paul M. MURPHY, Plaintiff,
v.
MILWAUKEE AREA TECHNICAL COLLEGE, Defendant.
No. 96-C-0117.
United States District Court, E.D. Wisconsin.
September 15, 1997.
*1213 Michael O. Bohren, Marola & Bohren, Milwaukee, WI, for Plaintiff.
Sarah J. Elliott, von Briesen, Purtell & Roper, Milwaukee, WI, for Defendant.
MEMORANDUM AND ORDER
GORENCE, United States Magistrate Judge.
Plaintiff Paul Murphy filed this action alleging reverse discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq. Specifically, the plaintiff, a licensed Wisconsin attorney, alleges that defendant Milwaukee Area Technical College (MATC) did not hire him for a full-time paralegal teaching position for which he was the most qualified candidate because of his race and sex. This case was assigned to this court according to the random assignment of civil cases pursuant to 28 U.S.C. § 636(b)(1)(B) and Local Rule 13.03 (E.D.Wis.). The parties have consented to United States magistrate judge jurisdiction. Presently pending is the defendant's motion for summary judgment which will be addressed herein.
STATEMENT OF FACTS
The relevant facts in this case are largely undisputed. The plaintiff, a white male, is an attorney licensed to practice law in the State of Wisconsin who taught part-time at MATC. In 1990, a full-time paralegal instructor position in the Business Division at MATC became vacant. Dr. Philip Langerman, MATC's Vice President of Academic Affairs, discussed filling the position with Patricia Holy, then Dean of the Business Division, and Ron Radtke, Associate Dean of the Business Division. A personnel requisition form was prepared and forwarded to the Human Resources Division which drafted a job posting for the paralegal instructor position. The job was posted on July 27, 1990. The personnel requisition form indicated that this was an "underutilized position" in regard to blacks and Hispanics. On August 14, 1990, the plaintiff submitted an application for the paralegal teaching position.
The "Qualifications" listed on the July 27, 1990, posting included the following: 1) a bachelor's degree and a law degree; 2) a minimum of two years of experience in the practice of law; 3) ability to meet state vocational, technical and adult education (VTAE) certification requirements; 4) ability to communicate effectively both orally and in writing; 5) ability to relate successfully with students and staff; 6) experience in the utilization of a paralegal is preferred; and, 7) previous teaching experience is desirable. The plaintiff states that by letter dated September 26, 1990, he was advised that the job was being reposted and that he would be considered for the position unless he affirmatively withdrew his name.
On October 2, 1990, the position was reposted based on changes in the job qualifications. The October, 1990, posting added to item 2 of the "Qualifications" section experience as a paralegal as an alternative to experience in the practice of law. Item 6 was changed to add experience as a paralegal as an alternative to experience in the utilization of a paralegal. The posting also added as Item 8: "Experience with computers in a law office was desirable."
Sixty-six applications were received and a screening committee consisting of Dorsey Kendrick, the Dean of the Business Division, Mike Walsh, Dean of Printing, James Miersma, Don Lubner and Ron Radtke, the Associate Dean of the Business Division, determined who would be interviewed. Miersma and Lubner were attorneys on the MATC staff who taught paralegal courses. The plaintiff was one of 15 candidates interviewed by the screening committee. He was interviewed on December 5, 1990. The plaintiff received the highest average score of all the candidates interviewed.
Initially, the screening committee recommended three candidates to proceed to the next level of interviews, a white female and two white males, one of whom was the plaintiff. A black male applicant who scored second highest in the interview was not recommended for the next step in the process. When Vicky Beckman, the personnel specialist in the Human Resources Department responsible for recruitment for the paralegal *1214 instructor position, noticed that the black male applicant had not been recommended for the next set of interviews, she asked Mr. Radtke if he would recommend four people for the next interviews. He agreed, and after discussing the list with Dr. Romanger Fredericks, the Director of Human Relations, Ms. Beckman added the black male applicant to the list of candidates. Thus, the plaintiff was one of four candidates recommended to the hiring authority.
In a memorandum dated January 11, 1991, Dr. Fredricks wrote to Ms. Beckman expressing concerns about the effect of the changes in listed qualifications, and several questions used in the interview sessions. He wrote as follows:
After a very careful review of the materials and the conversation that you and I had, I would like to share with you my: Findings....
That the job advertisement for the Paralegal Instructor was posted on July 27, 1990 and was changed inappropriately on October 2, 1990 to reflect the changes:
a. "Two (2) years of experience in the practice of law" changed to "2 years experience as a paralegal or in the practice of law."
b. "Experience in utilization of a paralegal is preferred" was changed to "experience as a paralegal or experience in the utilization of a paralegal is preferred."
c. "Experience with computers in a law office setting is desirable" was not a qualification on the first posting.
Qualifications included a law degree. A law degree may be preferred but it is not a qualification for the position. As you know, consideration of degrees or formal education in making hiring decisions may be unlawful when there is a disparate impact on some groups such as minorities and the employer is unable to show that a degree or education is necessary for the performance of job.
Several questions used in the interview session were inappropriate and/or unlawful:
Question # 2 ... Do you currently hold a license to practice law? In which state and what is your number?
Nowhere in your announcement was it indicated that a license was required or preferred. It must be understood that an employer may wish to inquire as to an applicant's educational history, but care should have been taken to ensure that only clearly job related education was considered.
Question # 8 ... "Other legal specialty courses in the program are Legal Research, Civil Procedure, Legal Writing, Litigation, Trusts and Estates, Collections, and Bankruptcy. Please indicate your qualifications and your interest in teaching each of these courses;"
Question # 9 ... "Do you have any other training or experience that might lead to initiation of additional legal specialty areas?;"
Question # 10 ... "Please give us a few examples which demonstrate your ability to relate to a culturally diverse student population;" and Question # 11 ... "Why did you leave your present position?"
All of the above questions were inappropriate and were not a part of the job descriptions, and added nothing to the selection process.
Concerns....
That applicants were not given an equal opportunity at this job.
That the legality of the entire hiring process for this position was eroded when the changes in the job description were made and inappropriate questions were used.
Recommendations....
That this position be readvertised and all candidates who applied be notified in writing.
That the announcement be reviewed by the Human Relations/
Affirmative Action Office before posting;
That the committee selected for interviewing candidates have an Affirmative
*1215 Action briefing before the interview process.
That questions be used (sic) in the interview process be approved by the Human Relations/Affirmative Action Office.
On February 6, 1991, the defendant notified the plaintiff by letter that the position had been re-evaluated, a new job description developed and that a new interview would be conducted. The plaintiff was further advised that if MATC did not hear from the plaintiff by February 22, 1991, it would assume he was still interested in the position. On February 9, 1991, the full-time paralegal position was reposted. Item 1 in the "Qualifications" section was changed to indicate that the applicant "Must have a Bachelor's degree. A law degree is preferred." The position was not designated as an "under-utilized position."
The screening process was re-initiated and Ms. Beckman made a list of candidates whose applications were received and who met the minimum qualifications. The plaintiff's name was not on the "Paralegal Instructor Applicant Review List" dated May 28, 1991.
A completely new screening committee was established which reviewed and narrowed the list of applications. The plaintiff was not among the ten candidates interviewed in June, 1991. The screening committee recommended three candidates to proceed to the next level a black female, a white male and a black male. The three finalists were interviewed by a four member committee. Carol Brady, a black female, was recommended for hire and was hired as the paralegal instructor. She received her bachelor's degree from Howard University in 1993, and graduated from Southern University School of Law in 1981, but was not licensed to practice law in Wisconsin.
The plaintiff filed a charge of sex and race discrimination with the Equal Employment Opportunity Commission (EEOC). He received a Notice of Right to Sue dated October 31, 1995.
SUMMARY JUDGMENT STANDARD
Summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); see also, Anderson v. Liberty Lobby, Inc. 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986); McNeal v. Macht, 763 F.Supp. 1458, 1460-61 (E.D.Wis.1991). "Material facts" are those facts that, under the applicable substantive law, "might affect the outcome of the suit." See Anderson, 477 U.S. at 248, 106 S.Ct. at 2510. A dispute over "material facts" is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. The burden of showing the needlessness of a trial (1) the absence of a genuine issue of material fact and (2) an entitlement to judgment as a matter of law is upon the movant.
However, when the nonmovant is the party with the ultimate burden of proof at trial, that party retains its burden of producing evidence which would support a reasonable jury verdict. Anderson, 477 U.S. at 267, 106 S.Ct. at 2519-20; see also, Celotex Corp., 477 U.S. at 324, 106 S.Ct. at 2553. "Rule 56(c) mandates the entry of summary judgment, ... upon motion, against a party who fails to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial." Celotex Corp., 477 U.S. at 322, 106 S.Ct. at 2552 (emphasis added). All inferences are taken in the light most favorable to the non-moving party. Matter of Wade, 969 F.2d 241, 245. (7th Cir.1992).
ANALYSIS
In moving for summary judgment, defendant MATC asserts that the plaintiff has failed to allege the requisite elements of a prima facie claim of reverse discrimination under Title VII. In the traditional Title VII action, a plaintiff can prove discrimination in one of two ways. He can meet his burden of proof by offering direct proof of discriminatory intent or he can rely on the burden shifting method of proof set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 *1216 S.Ct. 1817, 36 L.Ed.2d 668 (1973) for proving discrimination by indirect evidence. Sample v. Aldi, Inc., 61 F.3d 544, 547 (7th Cir.1995); DeLuca v. Winer Industries, Inc., 53 F.3d 793, 797 (7th Cir.1995). Under the McDonnell Douglas framework, the plaintiff first must establish by a preponderance of the evidence a prima facie case. St. Mary's Honor Center v. Hicks, 509 U.S. 502, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993); Hill v. Burrell Communications Group, Inc., 67 F.3d 665, 667 (7th Cir.1995). Once established, the burden of production shifts to the employer to articulate some legitimate, non-discriminatory reason for the adverse action about which the plaintiff complains. If the employer meets this burden, the plaintiff must demonstrate that the employer's stated reason was pretextual. Ultimately the plaintiff must demonstrate that the employer's real reason for the action was discriminatory. Hill, 67 F.3d at 667-668.
To demonstrate a prima facie case of discrimination, a plaintiff must show: 1) that he is a member of a protected class; 2) that he applied and was qualified for a job for which the employer was seeking applicants; 3) that despite his qualifications, he was rejected; and, 4) that, after his rejection, the position remained open and the employer continued to seek applicants from persons of plaintiffs qualifications. McDonnell Douglas Corp. v. Green, 411 U.S. at 802, 93 S.Ct. at 1824; Hill, 67 F.3d at 668.
Because the plaintiff is a white male, his claim is one of reverse discrimination. The plaintiff has produced no direct evidence of discrimination on the basis of his gender or race. Therefore, the McDonnell Douglas framework will be utilized, although this court notes that it is an open question in this circuit whether that analysis is the proper one where reverse discrimination is alleged. Hill, 67 F.3d at 668 n. 2; see also, Greenslade v. Chicago Sun-Times, 930 F.Supp. 323, 328 n. 1 (N.D.Ill.1996), affirmed. 112 F.3d 853 (7th Cir.1997).
Strict application of the McDonnell Douglas standard would eliminate all cases of reverse discrimination by preventing a plaintiff from making out a prima facie case because, by definition, the plaintiff is not a member of a protected class. Hill, 67 F.3d at 668. In reverse discrimination cases, some courts have modified the first McDonnell Douglas factor to allow a male plaintiff to establish a prima facie case of intentional disparate treatment if he alleges "background circumstances support[ing] the suspicion that the defendant is that unusual employer who discriminates against the majority." O'Patka v. Menasha Corp. 878 F.Supp. 1202, 1206-07 (E.D.Wis.1995) (citing Kelsay v. Milwaukee Area Technical College, 825 F.Supp. 215, 218-19 [E.D.Wis.1993] (quoting Parker v. Baltimore and Ohio R.R., 652 F.2d 1012, 1017 [D.C.Cir.1981]); Harding v. Gray, 9 F.3d 150, 153 (D.C.Cir. 1993). see also, Notari v. Denver Water Dept., 971 F.2d 585, 589 (10th Cir. 1992); Murray v. Thistledown Racing Club, 770 F.2d 63, 67 (6th Cir.1985)). The Court of Appeals for the Seventh Circuit has acknowledged but not expressly adopted this standard. See Christensen v. Equitable Life Assurance Society, 767 F.2d 340, 343 (7th Cir.1985), cert. denied, 474 U.S. 1102, 106 S.Ct. 885, 88 L.Ed.2d 920 (1986).
Courts have determined that this modification is necessary because a prima facie case under the McDonnell Douglas test raises an inference of discrimination "only because we presume these acts if otherwise unexplained, are more likely than not to be based on consideration of impermissible factors." Furnco Construction Corp. v. Waters, 438 U.S. 567, 577, 98 S.Ct. 2943, 2949, 57 L.Ed.2d 957 (1978). These presumptions are based upon a plaintiff's membership in an historically disfavored group which are not necessarily justified when the plaintiff is a member of a historically favored group. Livingston v. Roadway Express, Inc., 802 F.2d 1250, 1252 (10th Cir.1986).
In formulating this "background circumstances" test in reverse discrimination cases, courts have acknowledged that is not an additional hurdle for white plaintiffs. Harding, 9 F.3d at 154. Nor is designed to disadvantage the white plaintiff who is entitled to the same protection under Title VII as a minority plaintiff. Id.; McDonald v. Santa Fe Trail Transportation Co., 427 U.S. 273, 280, 96 S.Ct. 2574, 2578-79, 49 L.Ed.2d 493 (1976). Rather, this requirement "merely substitutes for the minority plaintiff's burden *1217 to show he is a member of a racial minority; both are criteria for determining whether the employer's conduct raises an `inference of discrimination.'" Harding, 9 F.3d at 153 (citing Bishopp v. District of Columbia, 788 F.2d 781, 786 [D.C.Cir.1986]).
"`Background circumstances' means simply that in our society, where `reverse discrimination' is the exception, white plaintiffs must show more than the mere fact that they are white before their non-selection in favor of a minority candidate will raise an inference of discrimination." Harding, 9 F.3d at 154. Background circumstances does not necessarily mean "some circumstances in the employer's background." Id. Thus, the non-minority plaintiff who establishes that he was better qualified than the minority candidate selected has stated sufficient background circumstances to establish his prima facie case. See Id.
This court finds the reasoning underlying the formulation of the background circumstances test persuasive and will use the "background circumstances" element in determining whether or not the plaintiff has made out a prima facie case of reverse discrimination.
The fourth prong of the McDonnell Douglas analysis also has been modified. In Hill, the court reasoned that the proper standard in reverse discrimination cases "would require plaintiff to prove that [he] was meeting the employer's legitimate expectations, was adequately qualified for the job, was fired or not hired, and that the employer found a replacement of a different race [or gender]." Id. (citing Pilditch v. Board of Education of City of Chicago, 3 F.3d 1113, 1116 [7th Cir, 1993], cert. denied, 510 U.S. 1116, 114 S.Ct. 1065, 127 L.Ed.2d 385 [1994].) However, in light of the Supreme Court's decision in O'Connor v. Consolidated Coin Caterers Corp., 517 U.S. 878, 116 S.Ct. 1307, 134 L.Ed.2d 433 (1996), the plaintiff need not prove that he was replaced by a person who was a member of a different group. "That one's replacement is of another race, sex or age may help to raise an inference of discrimination, but it is neither a sufficient nor a necessary condition." Carson v. Bethlehem Steel Corp., 82 F.3d 157, 159 (7th Cir. 1996). Thus, in modifying the fourth step of the analysis, the court stated that the proper question is "whether the plaintiff has established a logical reason to believe that the decision rests on a legally forbidden ground." Id.
With this overview, the court will now address whether the plaintiff has met his burden of establishing a prima facie case. The plaintiff asserts that the background circumstances support the suspicion that the defendant is that unusual employer who discriminates against the majority. The plaintiff questions the reposting and modification of the job description at the direction of Romanger Fredricks. He contends that the first interview met the defendant's affirmative action requirements and that there was no legitimate reason to have other postings. The plaintiff is basing his claim on the facts that: 1) the position was reposted and the qualifications were modified after the plaintiff was a finalist for the position, 2) that he was not included in the last posting process, and 3) a black female was chosen for the position.
The plaintiff does not present evidence that he was more qualified than the person selected for the position or that the defendant had some reason or inclination to discriminate individually against white males. See Harding, 9 F.3d at 153. He does not present facts to show to support the suspicion that the defendant is an employer that discriminates against the majority. The undisputed facts show that the defendant posted for a teaching position, revised the required job qualifications, reposted the position and interviewed the top candidates. Four candidates, a white female, a black male and two white males, one of whom was the plaintiff, were recommended to the hiring authority. Three months after this second posting, the defendant's human relations director questioned the changes in the listed job qualifications and expressed concerns about the lawfulness and appropriateness of several questions utilized in the interview process. The decision was then made to repost the job a third time.
Neither party offers any explanation as to why the plaintiff's name was not included in the third posting and selection process. The plaintiff merely states that "[l]osing or misplacing *1218 plaintiff's application for the second series of interviews, removed the strongest white male candidate from the interview process." (Plaintiff's Brief in Opposition to Defendant's Motion for Summary Judgment at 8). However, the reposting of the position was necessitated, in part, by the fact that the requirement of a law degree was not job-related and could not be justified.
The procedures employed by the defendant for recruiting and hiring a paralegal instructor are not a model for personnel practice and show little consideration for the applicants actively seeking employment. However, the defendant's scrutiny and modification of the posting and hiring process does not raise an inference of discrimination. The defendant's motivation was to ensure that the qualifications for the position and the questions asked of interviews were job related. Moreover, the final list of candidates recommended by the screening committee was comprised of a black female, a white male, and a black male. Thus, there is no showing that the selection of a white person or a male was foreclosed. The fact that the four-member committee which interviewed these applicants selected the black female for the position does not establish that the defendant had some reason or inclination to discriminate against white males.
The plaintiff has also failed to show that he was more qualified than the person selected for the position. The black woman chosen for the job was a lawyer as is the plaintiff, although she was not licensed to practice in Wisconsin. Since the job at issue was for a full-time paralegal instructor in the Business Division, a license to practice law was not a necessary job requirement. Moreover, a law degree was not considered a job-related qualification. There is no evidence that given the nature of the job, the plaintiff was more qualified. See Harding, 9 F.3d at 153 (citing Parker, 652 F.2d at 1017).
The plaintiff has failed to present facts and circumstances sufficient to raise an inference of discrimination. He has merely shown that he is a white male and that the person hired was a black female. This is insufficient to establish the suspicion that the defendant is that unusual employer who discriminates against the majority. Harding, 9 F.3d at 154. Thus, the plaintiff has failed to establish the first prong of a prima facie case of reverse discrimination.
The plaintiff has also failed to establish a logical reason to believe that the defendant's decision rests on a "legally forbidden ground." See Carson, 82 F.3d at 159. While hardly a model of good personnel procedures, the defendant's actions evince an attempt to make sure the job qualifications and hiring process were fair, equitable and legal. While the failure to include the plaintiff's application in the final application process is unexplained, that fact alone is insufficient to create an inference of discrimination in this case.
At the summary judgment stage, the plaintiff bears the burden of showing that there is a genuine issue of material fact because he has the burden of establishing his prima facie case at trial. Celotex, 477 U.S. at 322-23, 106 S.Ct. at 2552-53. Although the facts must be viewed in the light most favorable to the non-moving party, the plaintiff must support his claim with facts in the record.
The plaintiff has failed to establish a prima facie case of reverse discrimination and, thus, his claim is subject to dismissal upon summary judgment. The defendant's motion for summary judgment will be granted.
The court notes that in resolving summary judgment motions in discrimination cases, it ordinarily addresses the alternative issues of whether a defendant has demonstrated that it had a legitimate, nondiscriminatory reasons for its actions and whether a plaintiff has presented sufficient evidence to show that the legitimate, nondiscriminatory reasons are pretextual. However, those issues have not been addressed by the parties and therefore will not be addressed by the court.
ORDER
NOW, THEREFORE, IT IS ORDERED the defendant's motion for summary judgment be and hereby is GRANTED.
IT IS FURTHER ORDERED that the Clerk of United States District Court enter judgment accordingly. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645151/ | 994 So.2d 310 (2008)
FOSTER
v.
STATE.
No. 2D08-3990.
District Court of Appeal of Florida, Second District.
October 22, 2008.
Decision without published opinion. Mand.denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/608734/ | 995 F.2d 234
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.UNITED STATES of America, Plaintiff-Appellee,v.Jose Martin HUERTA, Defendant-Appellant.
No. 92-30185.
United States Court of Appeals, Ninth Circuit.
Submitted May 25, 1993.*Decided June 1, 1993.
Before: HUG, WIGGINS, and THOMPSON, Circuit Judges.
1
MEMORANDUM**
2
Jose Martin Huerta appeals from his 41-month sentence following entry of a guilty plea to conspiracy to possess with intent to distribute cocaine in violation of 21 U.S.C. §§ 841(a)(1), 846. Pursuant to Anders v. California, 386 U.S. 738 (1967), Huerta's counsel submitted a brief raising one possible issue for review: whether the district court erred by failing to depart downward from the applicable Guidelines range for sincere contrition. We have jurisdiction under 28 U.S.C. § 1291. We grant counsel's request to withdraw and affirm the district court judgment.1
3
At sentencing, Huerta stated "I just like to ask for your forgiveness for what I did. I am very repentant for it. I never want to do anything again that would separate me from my family the way I have been separated now. So I'm sorry." He did not request a downward departure.
4
Because Huerta failed to request a downward departure before the district court, we deem the issue waived and decline to reach the merits. See United States v. Quesada, 972 F.2d 281, 283-84 (9th Cir.1992) (defendant waived downward departure argument where he failed to raise it before the district court), cert. denied, 113 S.Ct. 1348 (1993).
5
AFFIRMED.
*
The panel unanimously finds this case suitable for decision without oral argument. Fed.R.App.P. 34(a); 9th Cir.R. 34-4
**
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3
1
Our independent review of the record pursuant to Penson v. Ohio, 488 U.S. 75, 83 (1988), discloses no other issues for review | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1918581/ | 764 A.2d 1031 (2001)
Michael KELLY, Plaintiff-Appellant,
v.
Thomas J. ELY, Defendant-Respondent.
Superior Court of New Jersey, Appellate Division.
Argued November 13, 2000.
Decided January 19, 2001.
William W. Graham, Manasquan, argued the cause for appellant (Carey & Graham, attorneys; Mr. Graham, of counsel and on the brief).
Stephen J. Foley, Jr., Asbury Park, argued the cause for respondent (Campbell, Foley, Lee, Murphy & Cernigliaro, attorneys; Dennis R. O'Brien, on the brief).
Before Judges WEFING and CUFF.
The opinion of the court was delivered by WEFING, J.A.D.
In 1960, the New Jersey Supreme Court adopted the fireman's rule in New Jersey, barring a firefighter from recovering damages in a tort action against a property owner for injuries received while battling that fire. Krauth v. Geller, 31 N.J. 270, 157 A.2d 129 (1960). Writing for the court, Chief Justice Weintraub held that "the owner or occupier [of a premises] is not liable to a paid fireman for negligence *1032 with respect to the creation of a fire." Krauth, supra, 31 N.J. at 273, 157 A.2d 129.
In 1994, the Legislature passed N.J.S.A. 2A:62A-21 which purports to abrogate the rule by permitting a firefighter injured "directly or indirectly [as] the result of the neglect, willful omission, or willful or culpable conduct or any person or entity ... [to] seek recovery and damages from the person or entity whose neglect, willful omission, or willful or culpable conduct resulted in that injury." The present case calls for us to consider the extent of a landowner's liability under this statute to a firefighter injured on the premises.
The underlying facts are undisputed. Accordingly the matter was presented to the trial court on defendant's motion for summary judgment. Plaintiff appeals from the trial court's order granting that motion; we now affirm.
Plaintiff is a volunteer fireman in Spring Lake Heights, New Jersey. On July 20, 1995, he responded to a report of a fire at defendant's home at 30 Apple Drive; defendant had been attempting to ignite his outdoor gas grill and the propane tank became engulfed in flames. Plaintiff described the incident in the following manner: "I carry all of my own gear in my truck. I had my gear on. I was running towards the fire scene. I was putting my jacket on, and called to another fire fighter and tripped over the curb." After the fire was extinguished, plaintiff learned he had fractured his elbow and wrist in his fall.
There was no evidence that plaintiff's fall was in any way occasioned by negligent maintenance of the curb upon which he tripped. Plaintiff did urge, however, that the fire itself was the result of defendant's negligence. He noted that a subsequent inspection of the grill disclosed a break in the hose between the tank and the grill. He also noted that the owner's manual for the grill stated that the hose should be inspected before each use. According to plaintiff, such an inspection would have revealed the existence of that break. Plaintiff contended defendant was negligent in attempting to light the grill without conducting such an inspection and, as a result, should be held responsible in damages for the injuries plaintiff sustained in his fall.
In Krauth v. Geller, supra, the Court explained the underlying rationale for the fireman's rule in the following terms:
Probably most fires are attributable to negligence, and in the final analysis the policy decision is that it would be too burdensome to charge all who carelessly cause or fail to prevent fires with the injuries suffered by the expert retained with public funds to deal with those inevitable, although negligently created, occurrences.
[Krauth v. Geller, supra, 31 N.J. at 274, 157 A.2d 129.]
The Court in Krauth spoke in terms of paid firemen. This court subsequently extended the rule to volunteer firemen in Ferraro v. Demetrakis, 167 N.J.Super. 429, 400 A.2d 1227 (App.Div.), certif. denied, 81 N.J. 290, 405 A.2d 834 (1979). Several years thereafter, the Supreme Court further extended the rule to encompass police officers. Berko v. Freda, 93 N.J. 81, 459 A.2d 663 (1983). In the course of its opinion in that case, the Court again recognized the policy underlying the rule.
We perceive more than mere dollars-and-cents considerations underpinning the fundamental justice of the "fireman's rule." There is at work here a public policy component that strongly opposes the notion that an act of ordinary negligence should expose the actor to liability for injuries sustained in the course of a public servant's performance of necessary, albeit hazardous, public duties. In the absence of a legislative expression of contrary policy, a citizen should not have to run the risk of a civil judgment against him for negligent acts that occasion the presence of a firefighter at the *1033 scene of a carelessly-set fire or of a police officer at a disturbance or unlawful incident resulting from negligent conduct.
[Berko v. Freda, supra, 93 N.J. at 88-89, 459 A.2d 663.]
The Court yet again extended the scope of the rule in Rosa v. Dunkin' Donuts, 122 N.J. 66, 583 A.2d 1129 (1991) when it concluded that the rule precluded a police officer, who was injured when he slipped on an allegedly negligently maintained floor while carrying an injured person from the scene, from recovering for his injuries.
In an apparent attempt to shield injured innocent parties from some of the rule's potentially adverse consequences, some courts have refused to extend it beyond fire fighters and police officers. Lees v. Lobosco, 265 N.J.Super. 95, 625 A.2d 573 (App.Div.1993), certif. denied, 136 N.J. 29, 641 A.2d 1040 (1994) (holding that it did not bar a suit by an emergency medical technician who slipped on snow and ice); Kiernan v. Miller, 259 N.J.Super. 320, 612 A.2d 1344 (Law Div.1992) (holding it did not apply to a volunteer ambulance attendant); see contra, Siligato v. Hiles, 236 N.J.Super. 64, 563 A.2d 1172 (Law Div. 1989) (extending the rule to volunteer emergency rescue squad members). Other courts have developed various exceptions to the rule. Boyer v. Anchor Disposal, 135 N.J. 86, 638 A.2d 135 (1994) (rule did not bar recovery for fire inspector who, while at a shopping mall to look for fire code violations, slipped and fell on a large oily spot on a driveway); Mahoney v. Carus Chemical Co., 102 N.J. 564, 510 A.2d 4 (1986) (rule inapplicable when willful and wanton misconduct creates the hazard that causes the injuries); McGriff v. Newark Housing Authority, 259 N.J.Super. 407, 613 A.2d 1172 (App.Div.), certif. denied, 133 N.J. 429, 627 A.2d 1135 (1992) (rule did not bar suit by police officer who slipped and fell on ice while walking to his car to retrieve his summons book because plaintiff was exposed to no greater risk of harm than anyone else walking through the parking lot); Vogel v. Skobo, 258 N.J.Super. 431, 609 A.2d 1316 (App.Div.), certif. denied, 130 N.J. 599, 617 A.2d 1222 (1992) (police officer pursuing a speeding motorcycle not covered by the rule when his injuries were the result of an independent and intervening act of negligence); Knoetig v. Hernandez Realty Co., 255 N.J.Super. 34, 604 A.2d 619 (App.Div.), certif. denied, 130 N.J. 394, 614 A.2d 617 (1992) (fireman who slipped and fell on accumulated ice and snow on public sidewalk in front of commercial premises while in the course of responding to an alarm not barred by the rule).
The fireman's rule exists in one form or another in many jurisdictions. Joseph Scholz, Rosa v. Dunkin' Donuts: The Fireman's Rule Revisited, 44 Rutgers L.Rev. 405, 407. The rule itself is basically rooted in a public policy judgment. Krauth v. Geller, supra, 31 N.J. at 274, 157 A.2d 129; Dobbs, The Law of Torts, 770-72; Lindahl, Modern Tort Law, § 39.13.
It has, however, come under criticism (see, e.g., Justice Handler's dissent in Rosa, supra, 122 N.J. at 82-86, 583 A.2d 1129) and some states have abandoned the law or limited its scope. Comment, Where There's Smoke, There's the Firefighter's Rule: Containing the Conflagration After One Hundred Years, 1992 Wis. L.Rev. 2031, 2032 n. 7; Mich. St. 600.2967; McKinney's General Municipal Law § 205-a; McKinney's General Obligations Law § 11-106; Virginia St. § 2.1-116.9:4.
Three years after Rosa, supra, the Legislature passed the statute in question. Plaintiff argues that the statute abrogated the fireman's rule in its entirety and thus that the trial court erred in granting defendant's motion for summary judgment. Defendant, not surprisingly, does not concur.
Research has not disclosed a reported New Jersey case analyzing the statute. Examination of the legislative history *1034 sheds no particular light on the statute's intended scope. Shortly after its passage, however, the Supreme Court did have occasion to note the legislative action. Boyer v. Anchor Disposal, supra. We recognize that the Court in that case began its opinion with the observation that "Because the Legislature has, in effect, abolished the firefighters' rule in New Jersey ... this case is probably the last in which this Court will consider an application of the rule." Boyer v. Anchor Disposal, supra, 135 N.J. at 87-88, 638 A.2d 135. We are satisfied, however, that such a statement cannot be interpreted as an authoritative holding that New Jersey had statutorily rejected all aspects of the fireman's rule, for the question confronting us was never presented to the Boyer Court for its consideration.
We thus turn to the statute itself for guidance. The statute affords a right of recovery to a firefighter who "suffers any injury ... while in the lawful discharge of his official duties and that injury... is directly or indirectly the result of the neglect ... of any person[; such firefighter] may seek recovery ... from the person ... whose neglect ... resulted in that injury." Plaintiff maintains that his claim against defendant should be submitted to the jury for determination, utilizing the traditional tort test of proximate cause.
We disagree, in the particular factual complex presented to us. The act of negligence to which plaintiff points relates to the outbreak of the fire itself, rather than to a condition of the premises encountered while responding to the fire. If plaintiff were alleging that his trip and fall were occasioned by defendant's negligent maintenance, we would agree that he would be entitled to proceed to a jury.
We have grave doubts, however, that the Legislature did, indeed, intend that a fireman injured while responding to a fire could seek damages for injuries received while in the course of responding to a fire simply because the fire itself was the product of negligence. Fires may result from many causes, including negligence, arson, or acts of nature such as lightening. The great majority are, most likely, related to negligence in some manner. Krauth v. Geller, supra, 31 N.J. at 273, 157 A.2d 129. According to the National Fire Data Center, of the 1.8 million fires reported in 1999, only 72,000 were classified as incendiary or suspicious. The National Fire Protection Association analyzed statistics from 1993 through 1997 and concluded that the leading cause of home fires and home fire injuries is cooking. Were we to adopt plaintiff's position, the scope of potential liability would be virtually unlimited.
Fire, moreover, poses a risk, not only to the responding firefighter and the owner and occupants of the burning premises, but to the surrounding properties and neighbors as well. We consider it highly unlikely that the Legislature would have intended to enlarge the scope of a property owner's liability in the manner plaintiff urges; we cannot ignore the potential consequence of encouraging an owner to delay summoning aid out of fear of incurring liability to a responding firefighter. Such delays can not only increase the risk when the firefighter finally arrives, they can also increase the risk to neighbors who are wholly without fault. Neither can we ignore that defendant is an individual homeowner and thus not able to pass on the likely higher cost of insurance. Principles of risk-distribution utilized in other contexts are thus inapplicable here. See, e.g., Brown v. St. Venantius School, 111 N.J. 325, 331, 544 A.2d 842 (1988). We decline to construe the statute in such a manner, absent a clearer declaration of the legislative intent to achieve such an end.
In our view, the statute was intended to restore the law to its pre-Rosa state and afford protection to a firefighter injured as a result of negligence unrelated to and independent of, the onset of the fire. It was not intended to make a homeowner responsible for a firefighter's injuries *1035 when the only negligence present related to the start of the fire itself.
We thus affirm the trial court's grant of summary judgment to defendant. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1918905/ | 106 B.R. 446 (1988)
In re LANNY JONES WELDING & REPAIR, INC. t/a Lanny Jones Contracting, Debtor.
UNITED STATES FIDELITY AND GUARANTY COMPANY, Plaintiff,
v.
LANNY JONES WELDING AND REPAIR, INC. and Internal Revenue Service, Defendants.
Bankruptcy No. 87-02001-RT, Adv. No. 88-0018-RT.
United States Bankruptcy Court, E.D. Virginia, Richmond Division.
May 12, 1988.
J. Stephen Buis, Taylor, Hazen & Kauffman, Richmond, Va., for United States Fidelity and Guaranty Co.
Pearson Liddell, Jr., Liddell & Liddell, Washington, D.C., for Lanny Jones Welding & Repair, Inc.
Richard F. Stein, Special Assist. U.S. Atty., Richmond, Va., for IRS.
S. David Schiller, Assist. U.S. Atty., Richmond, Va., for FAA.
SUPPLEMENTAL MEMORANDUM OPINION AND ORDER
DOUGLAS O. TICE, Jr., Bankruptcy Judge.
This matter is before the Court on United States Fidelity and Guaranty Company's (USF & G) Complaint to Determine Lien Priority, Relief from Automatic Stay, and Request for Turn-Over of Property. The *447 Federal Aviation Administration (FAA), which is holding funds which are at issue here, has been dismissed as a party. The parties have entered into a stipulation of facts and submitted briefs in support of their respective positions.
Findings of Fact
The facts have been fully stipulated. The Court adopts the parties' stipulation as its findings of fact.
In summary, the facts are as follows:
1. USF & G is a Maryland Corporation authorized to do business in the Commonwealth of Virginia.
2. The debtor (Jones Welding), a contractor, is a debtor-in-possession having filed a bankruptcy petition in this Court pursuant to 11 U.S.C. Chapter 11 on September 30, 1987.
3. On May 13, 1986, Jones Welding, among others, executed a Master Surety Agreement in favor of USF & G which provided conditions under which USF & G would furnish payment and performance bonds for construction contracts entered into by Jones Welding.
4. On or about September 25, 1986, the Small Business Administration (SBA), as prime contractor, entered into a contract with the United States Government (the FAA) for the installation of a wind shear detection system at Byrd International Airport, Richmond, Virginia (contract no. DT FA05-86-R-50353,LLWAS). This contract was in the original amount of $191,583.92, but the contract price was subsequently amended upward to $237,167.20. Jones Welding executed the contract as a subcontractor of the SBA. Though the contract was between the United States Government (the FAA), the SBA as prime contractor, and Jones Welding as the subcontractor of the SBA, payments were to be made directly to Jones Welding by the FAA.
5. On or about October 8, 1986, USF & G executed payment and performance bonds in favor of Jones Welding for the Byrd International Airport wind shear system contract.
6. Jones Welding completed its work on the wind shear system in August, 1987.
7. On March 11, 1987, the Internal Revenue Service (IRS) issued as to Jones Welding a Notice of Federal Tax Lien under Internal Revenue Laws in the amount of $41,601.40. This Notice of Tax Lien was recorded in the Clerk's Office, Hanover Circuit Court, Hanover County, Virginia, on March 16, 1987, and in the Virginia State Corporation Commission on March 16, 1987.
8. On April 2, 1987, the IRS issued as to Jones Welding a Notice of Federal Tax Lien in the amount of $66,470.19. This Notice of Tax Lien was recorded on April 7, 1987, in the Clerk's Office, Hanover Circuit Court, Hanover County, Virginia, and in the Virginia State Corporation Commission on April 8, 1987.
9. On April 22, 1987, the IRS executed a Request for Offset to the SBA as to funds due Jones Welding for its work on the wind shear project.
10. On April 24, 1987, the IRS issued a Notice of Levy to the SBA in the amount of $90,216.78, levying on all property, property rights, money, credits, and bank deposits held by the SBA and belonging to the taxpayer, Jones Welding.
11. Additionally, on April 24, 1987, the IRS issued a Notice of Levy on the Department of Transportation, FAA, as to all property, property rights, money, credits, and bank deposits which the Department of Transportation had in its possession and which belonged to Jones Welding. The Notice of Levy related to 941 taxes owed the IRS by Jones Welding. It is the position of the IRS that the April 24, 1987, Notice of Levy to the FAA constituted a Request for Offset to the FAA.
12. On April 24, 1987, the IRS issued a Notice of Levy to USF & G as to all property, property rights, money, credits, and bank deposits which USF & G had in its possession and which belonged to the debtor, Jones Welding. On May 27, 1987, USF & G wrote to the FAA requesting a status report on the project and levy information and further requesting that no money be paid to Jones Welding without permission of USF & G.
13. On June 16, 1987, the IRS filed a Notice of Federal Tax Lien as to Jones Welding in the amount of $2,579.42 in the *448 Clerk's Office, Hanover Circuit Court, Hanover County, Virginia, and in the Virginia State Corporation Commission on June 17, 1987.
14. On August 18, 1987, the IRS filed a Notice of Federal Tax Lien in the amount of $87,632.12 in the Clerk's Office, Circuit Court, Hanover County, Virginia.
15. Jones Welding also owes the IRS an additional $60,000.00 in unpaid Federal taxes for which no levy has been issued.
16. At the time of the completion of the project, Jones Welding had not paid its subcontractors or others who performed services or provided materials for it on the wind shear project; the debtor had failed to pay its subcontractors beginning in January 1987.
17. In October 1987, the IRS verbally advised the FAA that Jones Welding had filed a chapter 11 case and that notwithstanding the IRS request for offset, the FAA should continue to hold such funds until the bankruptcy court was requested to lift the automatic stay.
18. In November 1987, the FAA issued to Jones Welding's previous counsel a check in the amount of $86,000.00 for the Byrd International Airport wind shear project. Thereafter, this counsel paid to Jones Welding the sum of $80,000.00 from the FAA receipt. Jones Welding used approximately $40,000.00 of these funds to pay its creditors for work or services performed subsequent to the chapter 11 petition on jobs other than the wind shear project. Of the FAA funds, Jones Welding still holds in its debtor-in-possession account the sum of $30,000.00. Additionally, present counsel for the debtor is holding the sum of $10,500.00. The parties believe Jones Welding's previous counsel is still holding $5,000.00 of the funds.
19. Due to Jones Welding's failure to pay its subcontractors on the Byrd wind shear project, during the month of January 1988, USF & G paid the total amount of $97,594.05 to these subcontractors pursuant to the payment bond previously issued by it. These payments were made subsequent to the FAA release of $86,000.00 to the debtor and the debtor's use of $40,000.00 of these funds to pay its creditors. Also, these payments were made after consultation with and with the agreement of Jones Welding.
20. The FAA is presently holding additional funds in the approximate amount of $46,000.00 due Jones Welding on the Byrd wind shear project. The FAA is a mere stakeholder as to these funds and has agreed that it will remit them as directed by this Court.
CONCLUSIONS OF LAW
1. The Court finds the decision in United States v. Munsey Trust Co., 332 U.S. 234, 67 S.Ct. 1599, 91 L.Ed. 2022 (1947) to be controlling of the issue involved in this adversary proceeding.
2. Although USF & G argues that Pearlman v. Reliance Insurance Co., 371 U.S. 132, 83 S.Ct. 232, 9 L.Ed.2d 190 (1962) overrules Munsey Trust, this Court follows the logic and reasoning found in Aetna Insurance Co. v. United States, 197 Ct.Cl. 713, 456 F.2d 773 (1972) and Barrett v. United States, 177 Ct.Cl. 380, 367 F.2d 834 (1966). Contra, Home Indemnity Co. v. United States, 313 F.Supp. 212 (W.D.Mo. 1970). In Aetna and Barrett, the Court of Claims distinguished the Munsey Trust and Pearlman decisions, observing that the United States was a mere stakeholder in Pearlman but was a claimant to funds in its hands in Munsey Trust. Cf., Western Casualty and Surety Co. v. Brooks (In re Bruns Coal Co., Inc.), 362 F.2d 486, 492 (4th Cir.1966) (a case in which the Fourth Circuit noted this same factual distinction.).
3. In the case at bar, the United States is not a mere stakeholder. Although the FAA is a stakeholder of the funds in issue, the United States is a claimant to these funds through its agency, the IRS. The funds in issue refer to the approximately $46,000.00 being held by the FAA and the remainder of the $86,000.00 which was mistakenly transmitted by the FAA to the debtor's previous counsel in November 1987. The record reveals that these latter funds consist of (approximately) $5,000.00 held by debtor's previous counsel, $10,500.00 *449 being held by Liddell and Liddell, and the $30,000.00 in the debtor-in-possession account.
4. The inadvertent act of the FAA in releasing $86,000.00 of the retained funds to the debtor did not diminish or extinguish the set-off claim of the IRS. In re Krieger Steel Sections, Inc., 103 F.Supp. 351 (E.D.N.Y.1951), aff'd, 207 F.2d 83 (2nd Cir.1953), and In re Ram Industries, Inc., 80-1 U.S. Tax Cas. (CCH) ¶ 9406, 1977 WL 1344 (S.D. Ia.1977).
5. This Court holds that under Munsey Trust a set-off claim of the United States for taxes against retainages on a government construction contract is superior to the Miller Act payment bond surety's claim of equitable subrogation.
6. The Court does not disagree with USF & G's basic position that it has an equitable subrogation claim to the funds by virtue of its payments to the debtor's subcontractors and material suppliers. This position was of course recognized by the Supreme Court in the Pearlman case and in a number of subsequent court decisions. Although it is difficult to reconcile the Supreme Court's rationale in Pearlman with its Munsey Trust opinion, this Court after careful study has concluded that it must follow the rather broad holding in Munsey Trust and allow the United States to assert its set-off rights ahead of the surety's equitable subrogation claim.
IT IS THEREFORE ORDERED that the request of USF & G for turnover of the funds held by the FAA, the debtor and the debtor's present and former counsel is denied.
IT IS FURTHER ORDERED that the United States' set-off rights of the IRS are paramount to USF & G's equitable subrogation claim.
IT IS FURTHER ORDERED that the request of USF & G for relief from the stay and for adequate protection is denied as the issue is mooted by the Court's ruling. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582352/ | 329 N.W.2d 855 (1983)
213 Neb. 484
STATE of Nebraska ex rel. Paul L. DOUGLAS, Attorney General, Appellee,
v.
Joy SPORHASE et al., Appellants.
No. 43206.
Supreme Court of Nebraska.
February 11, 1983.
*856 Richard A. Dudden and Padley & Dudden, P.C., Ogallala, for appellants.
Paul L. Douglas, Atty. Gen. and G. Roderic Anderson, Asst. Atty. Gen., Lincoln, for appellee.
KRIVOSHA, C.J., BOSLAUGH, McCOWN, WHITE, HASTINGS, and CAPORALE, JJ., and COLWELL, D.J., Retired.
WHITE, Justice.
The Supreme Court of the United States in Sporhase v. Nebraska ex rel. Douglas, ____ U.S. ____, 102 S. Ct. 3456, 73 L. Ed. 2d 1254 (1982), reversed the judgment of this court and remanded the matter to this court, holding that since the reciprocity requirement of Neb.Rev.Stat. § 46-613.01 (Reissue 1978) violates the commerce clause, "[w]e leave to the state courts the question whether the invalid portion is severable." 102 S.Ct. at 3467.
In State exrel. Douglas v. Sporhase, 208 Neb. 703, 305 N.W.2d 614 (1981), this court held that underground water was not an article of commerce in this state, was the subject of public ownership, and thus regulations governing the use of such water, as well as prohibiting its export to nonreciprocating states, did not violate the commerce clause of U.S. Const. art. I, § 8, relying on Hudson Water Co. v. McCarter, 209 U.S. 349, 28 S. Ct. 529, 52 L. Ed. 828 (1908).
While declaring that this court erred in holding that underground water was not an article of commerce, the U.S. Supreme Court did not declare illegal the statutory scheme for conservation and preservation of ground water. Rather, on a variety of theories, the court approved the general scheme, e.g., "unexercised federal regulatory power" and "measures taken by a State to conserve and preserve for its own citizens this vital resource in time of severe shortage." Sporhase v. Nebraska ex rel. Douglas, 102 S.Ct. at 3463-64.
We are then called on to decide purely as a matter of state law whether the emphasized portion of § 46-613.01 is severable. That section provides: "Any person, firm, city, village, municipal corporation or any other entity intending to withdraw ground water from any well or pit located in the State of Nebraska and transport it for use in an adjoining state shall apply to the Department of Water Resources for a permit to do so. If the Director of Water Resources finds that the withdrawal of the ground water requested is reasonable, is not contrary to the conservation and use of ground water, and is not otherwise detrimental to the public welfare, he shall grant the permit if the state in which the water is to be used grants reciprocal rights to withdraw and transport ground water from that state for use in the State of Nebraska." (Emphasis supplied.)
This court has variously expressed the test to be applied in determining whether an unconstitutional clause in a statute may be severed from the remainder. (1) Whether, when absent the invalid portions, a workable plan remains. Nelsen v. Tilley, 137 Neb. 327, 289 N.W. 388 (1939). (2) Whether the valid portions of an act can be *857 enforced independently, and where the invalid portions do not constitute such an inducement to the valid parts that the valid parts would not have passed without the invalid parts. State v. Padley, 195 Neb. 358, 237 N.W.2d 883 (1976). (3) Whether the severance will do violence to the intent of the Legislature. Chase v. County of Douglas, 195 Neb. 838, 241 N.W.2d 334 (1976). (4) Whether a declaration of separability is included in the act, indicating that the Legislature would have enacted the bill absent the invalid portion. State ex rel. Meyer v. County of Lancaster, 173 Neb. 195, 113 N.W.2d 63 (1962); Nelsen v. Tilley, supra.
All the parties urge the court that the provision is severable in applying the tests described. We agree.
An examination of Chapter 46, article 6, reveals a comprehensive and complete approach to the conservation and beneficial use of ground water. The striking of the provision prohibiting transfer of water to nonreciprocating states does not weaken or otherwise impair the operation of the act. The valid portions present a complete, workable plan independent of the invalid portions.
The parties concede that no legislative history exists which proves or tends to prove that the invalid portions were an inducement to the passage of the act. Indeed, they point to a severability clause in 1969 Neb.Laws, Ch. 9, § 72, p. 145, containing amendments to § 46-613.01 as indicative of a contrary intent.
The briefs of the parties cite at great length the comments in floor debate and committee reports of members of the Legislature. The purpose of § 46-613.01 and the remainder of Chapter 46 was to conserve and apply to beneficial use an important Nebraska resource. No justification exists to assert that this important aim is frustrated by the severance of the invalid portion. On the contrary, the reverse appears to be abundantly clear.
We hold that severance of the portion of § 46-613.01, to wit, "if the state in which the water is to be used grants reciprocal rights to withdraw and transport ground water from that state for use in the State of Nebraska," did not constitute an inducement to the passage of § 46-613.01, does not make the act inoperative, and will not frustrate the intent of the Legislature. The remainder of § 46-613.01, after the unconstitutional portion is stricken, remains a viable statute.
JUDGMENT OF SEVERANCE. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1584960/ | 382 N.W.2d 300 (1986)
222 Neb. 126
Dwight BARTUNEK, Appellee,
v.
Kim BECKER, Doing Business As Becker Body Shop, Appellant.
No. 85-574.
Supreme Court of Nebraska.
Filed February 28, 1986.
Ted S. Griess, Sutton, for appellant.
Denzel R. Busick of Luebs, Dowding, Beltzer, Leininger, Grand Island, Smith & Busick, for appellee.
KRIVOSHA, C.J., HASTINGS, CAPORALE, and GRANT, JJ., and BUCKLEY, District Judge.
*301 KRIVOSHA, Chief Justice.
This appeal presents the question of whether an employee injured while working in an auto body shop is barred from recovery under the Nebraska workmen's compensation law because the body shop is located upon a farm site and the injured employee works both for the body shop and as a farmhand. On rehearing before three members of the Workmen's Compensation Court, the initial order of dismissal entered by a single judge of the Workmen's Compensation Court was reversed, and the three-judge panel found that the employee, Dwight Bartunek, had sustained an injury arising out of and in the course of his employment, for which he was entitled to compensation. In effect, the Workmen's Compensation Court further found that at the time of the injury Bartunek was not a farm laborer and therefore was not barred from recovery by reason of the provisions of Neb.Rev.Stat. § 48-106(2) (Reissue 1984). We believe that the three-judge panel was correct, and we affirm.
The three-judge panel found the following to be the facts. The appellant, Kim Becker, doing business as Becker Body Shop, owns and operates a body shop business located on a farm site in which Kim Becker and his father, Walter Becker, have an interest. The father coordinates the farming operations but has no interest in the body shop. The father does not charge the son any rental for the body shop's being located upon the farm site, nor does he in any way attempt to give directions regarding its operations. None of the employees of the father work in the body shop, although employees of the body shop work on the farm when so directed. The three-judge panel further found that Bartunek was employed by the son to work in the body shop but had worked on the farm in the harvests of 1982 and 1983. After the 1983 harvest was completed Bartunek worked in the body shop, returning to the fields in April of 1984. He nonetheless continued to work in the body shop when the weather was inclement. The three-judge panel further found that regardless of where Bartunek worked, most of his wages were paid from the body shop. The evidence indicates that the father and son maintain separate checking accounts, one for the farm business and one for the body shop, the latter in which the father has no interest.
On May 22, 1984, wet conditions prevented Bartunek from doing fieldwork, and as a consequence he was assigned by Kim Becker to work in the body shop. While assisting with putting fenders on a customer's car in the body shop, at the direction of Kim Becker, Bartunek sustained a back injury. As we have already indicated, the single question presented to us is whether Bartunek was covered by the workmen's compensation law of Nebraska or, by reason of the fact that he performed both covered work in the body shop and exempt work in the field, was not entitled to compensation for his injuries sustained while working in the body shop.
In beginning our analysis of this matter, we must keep in mind that findings of the Workmen's Compensation Court on rehearing have the same force and effect as a jury verdict and, if supported by sufficient evidence, will not be disturbed on appeal unless clearly wrong. Brown v. Leavitt Lane Farm, 215 Neb. 522, 340 N.W.2d 4 (1983). While it is true that § 48-106(2) generally exempts from workmen's compensation law "employers of farm or ranch laborers," the sole fact that one may be an employer of farm or ranch laborers does not answer the question. In Leppert v. Parker, 218 Neb. 63, 67, 352 N.W.2d 180, 182 (1984), we said: "It is clear from both the statute and the cases that it is the nature of the employer's business which determines the exemption, and not the work performed by the employee."
The question, then, turns on the nature of Kim Becker's business. It appears to us that he is engaged in two businesses, one a farming operation which is exempt under the law and the other an auto body shop which is not exempt. That an employer may be engaged in two businesses is not unique or unheard of in the law. It has *302 long been recognized in this jurisdiction. In Kaplan v. Gaskill, 108 Neb. 455, 459-60, 187 N.W. 943, 945 (1922), we said:
The fact that the employer, in this instance, was engaged in the business of buying and selling junk and in dealing in second-hand automobiles has no controlling influence upon the question of whether or not he was engaged in the regular business or vocation of renting houses. The act does not contemplate that a person can be engaged in only one regular business. He may be engaged in several. The question, then, of whether or not he was engaged in a regular business occupation in the holding and handling of the properties in question, and whether or not the employee was engaged in the usual course of the duties which were within the scope of that business, must be determined entirely aside from the question of whether or not the employer was engaged in any other kind or nature of business, as well as aside from the question of whether the employment was casual.
(Emphasis omitted.)
Moreover, we have recognized that it is not uncommon or strange for one to be engaged in both a farming operation exempt under the law and a nonfarming operation covered by the law. In Campos v. Tomoi, 175 Neb. 555, 557, 122 N.W.2d 473, 475 (1963), we specifically said: "The fact that the employer or employers are engaged in farming does not remove from the coverage of the statute other businesses or occupations carried on by the employer which are otherwise in the coverage of the statute." In Campos, supra, the employer was generally engaged in the farming industry but also conducted a hay-grinding business. When the employee was injured while operating the hay grinder, we found without difficulty that he was covered under the Workmen's Compensation Act and entitled to compensation. And, recently, in the case of Brown v. Leavitt Lane Farm, supra, we again reaffirmed our stand that one may be engaged in more than one business, saying, 215 Neb. at 527, 340 N.W.2d at 8:
"In accordance with the general rule ... that an employer may be engaged in a number of separate businesses and occupations, some within the compensation act and some not, the fact that an employer is engaged in farming does not remove from the coverage of the statute another business or occupation carried on by the employer which is otherwise within the coverage of the statute, nor does it subject the farming business to the statute."
We concluded in Brown, supra at 527-28, 340 N.W.2d at 8:
We hold that one employer may engage in two separate businesses, one subject to the workmen's compensation law and one exempt from that law, and that the employer's actions with regard to the business which is subject to the workmen's compensation law do not affect the employer's business which is statutorily exempt from the compensation law.
In the instant case the reverse must be true.
There can be little or no question that if this injury had occurred in town, everyone would acknowledge that the auto body shop was an industry covered under the workmen's compensation law of Nebraska. That it was located on the farm does not change that position. Bartunek, an employee of the body shop, was injured while working in the body shop. The fact that he was also compensated for doing farm labor which was exempted from the act does not change the coverage. The three-judge panel was correct in its findings, and its judgment must be affirmed. Appellee is awarded the sum of $1,000 for the services of his attorney in this court.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1584994/ | 382 N.W.2d 80 (1986)
The BOARD OF DIRECTORS OF the DAVENPORT COMMUNITY SCHOOL DISTRICT IN the COUNTIES OF SCOTT AND MUSCATINE, State of Iowa, Appellee,
v.
The QUAD CITY TIMES, AN UNINCORPORATED DIVISION OF LEE ENTERPRISES, INCORPORATED, Appellant.
No. 85-739.
Supreme Court of Iowa.
February 19, 1986.
John J. Carlin, of John J. Carlin, P.C., Davenport, for appellant.
Michael L. Noyes, of Rehling, Lindburg and Gosma, Davenport, for appellee.
Considered en banc.
WOLLE, Justice.
This case presents a question of public access to information on which a school board must take official action. The defendant newspaper sought to inspect the transcript of evidence generated by statutory proceedings in which the plaintiff school board undertook to decide whether to terminate the employment contract of a school administrator. See Iowa Code § 279.24 (1985). The board was not sure whether the transcript was exempted from public access, so it brought this action in district court requesting a declaratory ruling on the meaning of pertinent statutory language and also requested appropriate injunctive relief. The trial court on stipulated facts found that section 279.24 exempted the transcript from the public meeting and public record disclosure requirements of Iowa Code chapter 21 (the open meetings law) and chapter 22 (the public records law). We reverse, finding that the transcript constituted the record of a public hearing which was not exempt from disclosure.
Before analyzing and construing the language of several statutes which govern the public's right of access to this transcript, we first summarize the requisite statutory procedures of Iowa Code section 279.24 which the board properly followed in considering whether to terminate the contract of its non-probationary school administrator. (That statute prescribes a somewhat different procedure for terminating probationary administrators employed less than two years.) The board first gave notice to the administrator that it had voted to consider termination of his contract. The notice stated specific reasons for considering termination. Had the administrator not requested a hearing the board itself would have determined at once whether to continue or discontinue the contract.
Because the school administrator requested a hearing, a hearing officer was selected and an official record was made of *81 the evidence presented in the proceedings before the hearing officer. That transcript is the focal point of the public access issue now before us. The transcript was required by Iowa Code section 17A.12(7) (made applicable to the proceeding by Iowa Code section 272A.8) which specifies:
Oral proceedings shall be open to the public and shall be recorded either by mechanized means or by certified shorthand reporters.
At the conclusion of the reported hearing, the hearing officer submitted to the board and the administrator findings of fact and a proposed decision. That decision of the hearing officer would have become the final decision of the board in the absence of appeal by the administrator or further review of the matter by the board on its own motion.
Here, however, the administrator filed written notice of appeal to the board, and procedures governing that appeal to the board are also set forth in section 279.24. That statute's pertinent language respecting the public or private nature of proceedings before the board is as follows:
If the administrator appeals to the board, or if the board determines on its own motion to review the proposed decision of the hearing officer, a private hearing shall be held before the board.... The private hearing shall not be subject to the provision of chapter 21.
....
When the board has reached a decision, opinion, or conclusion, it shall convene in open meeting and by roll call vote determine the continuance or discontinuance of the administrator's contract. The record of the private conference and findings of fact and exceptions shall be exempt from the provisions of chapter 22.
The board presided at the private hearing and heard the case de novo upon the record made before the hearing officer. The board then convened in open meeting and by roll call vote announced that it had decided to continue the administrator's contract.
When the newspaper asked for the transcript of evidence and certain other records related to the termination proceedings, the board commenced this action seeking a declaratory judgment that the records were exempt from public disclosure. The parties stipulated that all information requested by the newspaper was within the evidence presented to the hearing officer. The parties also stipulated that the transcript of the proceeding before the hearing officer constituted the record used by the board in its private hearing conducted pursuant to section 279.24.
The newspaper contended it should have access to the transcript of the termination proceeding because sections 272A.8 and 17A.12(7) required that the proceedings before the hearing officer be open to the public. The board responded that the transcript developed before the hearing officer became the record before the board in its private hearing, and the transcript was therefore exempted from public disclosure by the specific language of section 279.24 which insulated the board's private hearing and conference from the open meetings and public records statutes, Iowa code chapters 21 and 22.
The trial court's declaratory judgment held the requested information exempt from disclosure. The court reasoned that to find the record before the hearing officer public, and the balance of proceedings before the board based on the same record private, would constitute an absurd interpretation of the statute and frustrate the legislative intent to make the board proceedings under section 279.24 private. The trial court found section 279.24 ambiguous and concluded that the legislature intended to deny the public access to all evidence in the record which the hearing officer presented to the board.
We disagree with the trial court's decision because we find in this statutory scheme a clear legislative intent to provide the public access to the information on which the board would make its decision. The newspaper points out, and the board acknowledges, that our construction of the *82 controlling statutes must give effect to established principles governing the examination of public records. Disclosure is favored over non-disclosure, and exemptions from disclosure are to be strictly construed and granted sparingly. City of Dubuque v. Telegraph Herald, Inc., 297 N.W.2d 523, 526-27 (Iowa 1980); Howard v. Des Moines Register & Tribune Co., 283 N.W.2d 289, 299 (Iowa 1979), cert. denied 445 U.S. 904, 100 S. Ct. 1081, 63 L. Ed. 2d 320 (1980).
Of pivotal importance is the impact of section 272A.8 on section 279.24 to which it directly makes reference. Section 272A.8 explicitly converts the section 279.24 proceeding before the hearing officer into a contested case hearing under chapter 17A, and that hearing must be "open to the public and shall be recorded" by the clear mandate of section 17A.12(7).
The board argues that we have narrowly limited the effect of section 272A.8 on section 279.24 proceedings, but the case it cites is inapposite. In Jones v. Loess Hills Area Education Agency 13, 319 N.W.2d 263, 264 (Iowa 1982), we merely refused to allow chapter 17A discovery proceedings in these termination proceedings because discovery would be incompatible with the tight time requirements section 279.24 prescribes. The openness of the proceeding before the hearing officer which section 17A.12(7) assures is not irreconcilably in conflict with other provisions of section 279.24. Any doubt must be resolved in favor of openness.
The trial court found "an inherent unfairness in allowing a bare transcript to be publicly disclosed without likewise allowing the findings and conclusions drawn by the hearing officer and the ultimate conclusions of the board to be disclosed as well." We disagree and find illuminating the newspaper's analogy between termination proceedings before the board and the partial confidentiality which accompanies trial by jury. Jury trials are for the most part open. The public is given free access to the evidence presented, the verdict of the jury, and the judgment rendered thereon. The deliberations of the jury, however, are confidential in nature. Iowa Rule of Civil Procedure 199(b) provides that jurors shall deliberate together privately, with no one communicating with them concerning the state of their deliberations.
As with evidence introduced in a jury trial, the evidence which first the hearing officer and then the board considers is made public by sections 272A.8 and 17A.12. As with jury deliberations, the board's consideration de novo of the evidence, deliberation toward a final decision, and findings of specific facts are private in nature and not subject to the provisions of chapters 21 and 22, by specific exemption in section 279.24 which makes those public meeting and records laws inapplicable. As with the return of a verdict and entry of judgment in open court, section 279.24 provides that the board shall reconvene in open meeting to announce by roll call vote whether it has decided to continue or discontinue the administrator's contract.
Viewed in the light of this analogy to jury trials, the several statutes here construed make sense and can readily be harmonized. The legislature did not intend to exempt from public access all evidence pertinent to the termination decision. It wrote the statutes to exempt the board's private hearing and conference in order that board members could in closed session examine de novo the transcript and findings of the hearing officer and through due deliberation arrive at a final decision. Specifically exempted from chapter 22, the public records statute, are the record of the private conference, findings of fact and exceptions. The transcript of evidence the board considers is not specifically exempted. This reading of the statutes squares with our cardinal rule of construction favoring public access to information on which public officials must take action affecting the public intent. Our so-called "sunshine laws" are creatures of statute which are to be construed in favor of openness, Telegraph Herald, Inc. v. City of Dubuque, 297 N.W.2d 529, 532-33 (Iowa 1980); Howard, 283 N.W.2d at 299; City of Dubuque, 297 N.W.2d at 527.
*83 We note that the issues in this appeal are now narrower than when the board commenced this action. The newspaper had initially requested more records than the transcript of evidence, and the board had alleged that some of the requested records should be declared confidential under Iowa Code sections 22.7 and 22.8. Those provisions within the general public records statute except from disclosure some specifically-described public records and also those whose disclosure would not be in the public interest and would substantially and irreparably injure someone. See Head v. Colloton, 331 N.W.2d 870, 873-74 (Iowa 1983) (citing cases interpreting those specific section 22 exemptions and holding they are to be narrowly construed, with injunctive relief from disclosure carefully circumscribed).
On this appeal the only question presented by he parties is the only issue decided by the trial court: whether Iowa Code section 279.24 exempts from public disclosure the transcript of evidence introduced at the hearing before the hearing officer. We conclude that the public character of that hearing makes the transcript a public record accessible to the newspaper.
The declaratory judgment of the district court is reversed. We construe Iowa Code sections 279.24, 272A.8, and 17A.12(7) (1985) to provide the newspaper, and the general public, access to the transcript made before the hearing officer in this proceeding concerning the proposed termination of the contract of a nonprobationary school administrator.
REVERSED.
All Justices concur except CARTER and HARRIS, JJ., who dissent, and LAVORATO, J., who takes no part.
CARTER, Justice (dissenting).
I respectfully dissent. There is no room in the present case for this court to pass judgment on the desirability of maintaining the confidentiality of the proceedings leading up to the board's vote on termination of school administrators. We are only asked to declare what the legislature has provided in this regard. In considering that question, I fully agree with the district court that the legislature intended, in enacting section 279.24, that all of the steps in the statutory process prior to the final roll call vote are to be accorded confidentiality.
In order to reach a different conclusion, it is necessary to attribute to the legislature an intent to induce consequences in the middle step of a three-step process which, by purpose and design, will necessarily defeat the clear declaration of intent which the same legislature has espoused in regard to the first and last steps. I submit that such self-defeating, statutory interpretation should be indulged in, if ever, only when the intent to self-destruct appears with unmistakable clarity on the face of the enactment.
The majority's attempt to draw an analogy between the present situation and the deliberations of a jury is of no assistance whatsoever in understanding the issues presented on this appeal. There simply is no analogy between the two situations. There are specific statutes which bear on the confidentiality issue in the situation involved in section 279.24 proceedings which are not involved in the normal jury trial situation. In addition, the majority uses its predetermined interpretation of the statutes at issue in order to frame the analogy. If the purpose of the analogy is to aid in arriving at the proper interpretation, this is bootstrapping the result.
The three steps required in the present proceeding, prior to the final roll call vote of the board, are:
(1) The decision of the board to consider termination of the administrator and notification of the administrator of that decision;
(2) At the option of the administrator, a hearing before a hearing officer concerning whether just cause exists for termination of the administrator. Such hearing culminates in a written recommendation by the hearing officer;
(3) At the option of either the administrator or the board, a private hearing *84 before the board for review of the record made before the hearing officer and the hearing officer's proposed decision.
Within the first step, the board, if it desires, is allowed to maintain confidentiality of its deliberations and the notice to the administrator by reason of section 21.5(1)(i) and section 22.7(11). Within the third step, confidentiality is permitted by both the foregoing statutes and also by specific provision in section 279.24 that neither the private hearing or the record thereof are subject to the provisions of chapter 21 or chapter 22.
Within the second step (the one at issue here), confidentiality may be accorded to the detailed findings and recommendations of the hearing officer under section 22.7(11) and also by reason of the express provisions in section 279.24, exempting matters considered at the private hearing from the provisions of chapter 21 or chapter 22. The majority of the court concludes, however, that the proceedings before the hearing officer during the second step must be open to the public and that the transcript of that hearing is a public record by virtue of section 17A.12(7).
A major flaw in the majority's analysis is a misplaced reliance on statutes contained in chapter 17A. The Iowa Administrative Procedure Act was not written so as to apply to section 279.24 hearings. For this reason, it is an unreliable source upon which to rely in seeking the meaning of section 279.24. The provisions of chapter 17A are only involved in these proceedings to the extent that section 272A.8 makes them applicable. All that is said in the latter statute is "[t]he hearing shall be held pursuant to the provisions of chapter 17A relating to contested cases." This limited description of how the hearing shall be conducted falls far short of the majority's claim that section 279.24 proceedings are converted into contested cases under chapter 17A for all purposes.
Rather than being inapposite, as the majority suggests, our decision in Jones v. Loess Hills Area Education Agency 13, 319 N.W.2d 263, 264 (Iowa 1982) is highly instructive on this point. In Jones, we interpreted the quoted provisions of section 272A.8 as only relating to how the hearing is to be conducted. We indicated that it should have no applicability with respect to anything before or after the hearing. Here, the preparation and custody of the transcript are matters subsequent to the hearing. We also recognized in Jones that, because of the special attributes of section 279.24 proceedings, requirements of chapter 17A which are inconsistent therewith need not be considered as incorporated by reference under section 272A.8.
We have often said that we must construe statutes by examining the objects and purposes which the legislature sought to accomplish and the evils and mischiefs sought to be remedied and seek to reach a result which will effectuate those purposes. E.G., State v. Peterson, 347 N.W.2d 398, 402 (Iowa 1984); Iowa National Industrial Loan Co. v. Iowa State Department of Revenue, 224 N.W.2d 437, 440 (Iowa 1974); Iowa Code §§ 4.2, 4.6(1), (5) (1985). If it appears from such an examination of the present statutes that it was the intention of the legislature to accord confidentiality to the proceedings before the hearing examiner, then we should not hesitate to give the statutes this interpretation as a result of misplaced reliance on rules of construction favoring public access to information.
The opinion of the court in the present case may serve to dissuade administrators facing discharge from requesting hearings which will require the presentation of sensitive material. The legislature acted wisely in protecting against such disclosure at the other stages of the proceeding in order to foster full disclosure of all pertinent facts to the board. No reason has been suggested by the court why the legislature would intend a lesser degree of confidentiality to prevail in those instances where the administrator exercises the statutory right to an independent fact finder. The fact-finding process is an integral part of a single statutory proceeding in which the *85 legislature's desire for confidentiality is clearly expressed.
HARRIS, J., joins this dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585004/ | 382 N.W.2d 425 (1986)
Coyle W. DUNCAN, Plaintiff,
v.
PENNINGTON COUNTY HOUSING AUTHORITY; Frank C. Aukerman, Edward L. Mazourek and Continental Casualty Company; Dan J. Brutger; John A. Wahl; Richard E. Schreifels; Norman A. Beekley; Joel Marthaler; Don Schaefer; Gary Nelson; Dale Barck; and Tom Rentz, Defendants, and
Frank C. AUKERMAN, Edward L. Mazourek and Continental Casualty Company, Defendants, Third-Party Plaintiffs and Appellants,
v.
DAN J. BRUTGER, INC., Third-Party Defendant and Appellee.
No. 14937.
Supreme Court of South Dakota.
Considered on Briefs January 16, 1986.
Decided February 26, 1986.
Portia K. Brown and Timothy L. Thomas of Morrill, Hansen, Hubbard & Brown, Rapid City, for defendants, third-party plaintiffs and appellants.
*426 Horace R. Jackson of Lynn, Jackson, Shultz & Lebrun, P.C., Rapid City, for third-party defendant and appellee.
HENDERSON, Justice.
ACTION
This is an appeal from a Judgment which dismissed a Third-Party Complaint with prejudice, for failure to prosecute. The propriety of the dismissal for failure to prosecute is the sole issue presented. We affirm.
FACTS
On January 9, 1975, Coyle W. Duncan (Duncan) was injured while working at a construction site in Rapid City, South Dakota. In August 1975, Duncan filed suit against the Pennington County Housing Authority; Aukerman and Mazourek, Inc., a Rapid City architectural firm; and nine employees of the construction site's general contractor, Dan J. Brutger, Inc. (Brutger, Inc.). On March 29, 1976, Aukerman and Mazourek, Inc., filed a third-party complaint against Brutger, Inc., seeking recovery of any judgment received by Duncan plus the costs and attorney's fees incurred in defending Duncan's action. In early 1977, the third-party action was severed from Duncan's primary action and the primary action was tried to a jury in March of that year. Prior to trial, however, the nine employees and the Pennington County Housing Authority settled with Duncan. The jury awarded Duncan $215,000, and Aukerman and Mazourek, Inc., appealed to this Court. Our decision therein was rendered on September 26, 1979. See Duncan v. Pennington County Housing Authority, 283 N.W.2d 546 (S.D.1979).
After the severance in early 1977, Aukerman and Mazourek, Inc., took no further action in the third-party case until November 7, 1984, when it filed a Motion to Amend the Third-Party Complaint. Several years prior to this latter date, however, Aukerman and Mazourek, Inc., was dissolved and the original trial judge, Judge Bottum, died. By this Court's order, Frank C. Aukerman, Edward L. Mazourek, and Continental Casualty Company were substituted for Aukerman and Mazourek, Inc., as third-party plaintiffs and appellants herein. These three parties will be hereinafter collectively referred to as Aukerman and Mazourek.
Brutger, Inc., responded to Aukerman's and Mazourek's motion to amend by moving, inter alia, to dismiss for failure to prosecute. A hearing was held on the respective motions on November 20, 1984, and by a Judgment dated January 16, 1985, the circuit court dismissed the third-party action with prejudice.
From this Judgment, Aukerman and Mazourek now appeal.
DECISION
DID THE CIRCUIT COURT ABUSE ITS DISCRETION WHEN IT DISMISSED AUKERMAN'S AND MAZOUREK'S THIRD-PARTY COMPLAINT FOR FAILURE TO PROSECUTE?
SDCL 15-6-41(b) provides, inter alia: "For failure of the plaintiff to prosecute... a defendant may move for dismissal of an action or of any claim against him."[*] In reviewing the grant or denial of such a motion, this Court's inquiry is whether the circuit court abused its discretion when acting thereon. Watkins Products, Inc. v. Lytle, 90 S.D. 122, 124, 238 N.W.2d 299, 300 (1976). During such reviews, this Court has made several observations. First, we have observed that the circuit court's power to dismiss an action for lack of prosecution is unquestioned and is founded upon SDCL 15-6-41(b) and the circuit court's inherent power, authority and "`control necessarily vested in courts to manage their own affairs so as to achieve the orderly and expeditious disposition of cases.' Link v. Wabash R. Co., 370 *427 U.S. 626, 82 S. Ct. 1386, 8 L. Ed. 2d 734." Chicago & North Western Ry. Co. v. Bradbury, 80 S.D. 610, 612, 129 N.W.2d 540, 542 (1964). See also, Simkins v. Bechtol, 86 S.D. 187, 189, 192 N.W.2d 731, 732 (1971). Second, we have observed that although the power to dismiss for failure to prosecute is "a discretionary power, because of drastic consequences it should be exercised cautiously and granted only in case of an unreasonable and unexplained delay in prosecution." Id. Third, we have observed that the
mere passage of time is not the test. The question of laches "does not depend, as does the statute of limitations, upon the fact that a certain time has elapsed since the cause of action accrued, but whether, under all the facts and circumstances of the particular case, the plaintiff is chargeable with want of due diligence in failing to proceed with reasonable promptitude."
Bradbury, 80 S.D. at 612-13, 129 N.W.2d at 542 (citation omitted). Fourth, we have observed that it is the plaintiff's burden to proceed with his action, Potts v. Starr, 76 S.D. 91, 94, 72 N.W.2d 924, 925 (1955), and that ordinarily we will not interfere with a circuit court determination to dismiss for failure to prosecute. Simkins, 192 N.W.2d at 732.
In the present case, Aukerman and Mazourek contend the circuit court abused its discretion by dismissing their third-party action and they assert five rationales for reversal. We delineate these rationales and address their merits seriatim.
First, Aukerman and Mazourek assert an abuse of discretion occurred because Brutger, Inc., will not be prejudiced by permitting the action to continue. Daley v. County of Butte, 227 Cal. App. 2d 380, 38 Cal. Rptr. 693 (1964). Although this Court has not specifically intimated that prejudice, or lack thereof, to the defendant, is a consideration when deciding such a motion, it does appear to be one of the relevant factors to be considered under the facts and circumstances of any particular case. In this case, however, it appears that Brutger, Inc., and its insurance company, have lost their files relevant herein and that the third-party action will concern complicated contractual indemnity issues. It thus appears that the third-party action will concern some of the contents of these files and that some prejudice to the defense does exist.
Second, Aukerman and Mazourek assert that former counsel's health problems delayed the prosecution of this action and that this constitutes a reasonable excuse for the delay. 24 Am.Jur.2d Dismissal § 59 (1983); Annot., 80 A.L.R. 2d 1399, § 9 (1961). A review of the record, however, reveals that these health problems were incurred only within a year prior to the dismissal for failure to prosecute. This leaves approximately four years of legal inactivity and no intimation of health problems during such time. Former counsel's recent health problems thus do not constitute a reasonable excuse for delay.
Third, Aukerman and Mazourek assert that former counsel's failure to prosecute deprives them of effective representation and they should not be charged with such attorney's inaction. Daley. Attorney inaction and dismissing the plaintiffs' case, however, is the very nature of a dismissal for failure to prosecute and we are not confronted herein with a case involving death or great personal injury which would make it unjust to dismiss. On the contrary, we are dealing with an action to recover costs and attorney fees incurred in defending previous litigation and we find no injustice for charging Aukerman and Mazourek with former counsel's inaction.
Fourth, Aukerman and Mazourek assert that the dismissal was an abuse of discretion because at the time of the dismissal motion, they were prosecuting their claim. Ayers v. D.F. Quillen & Sons, Inc., 5 Storey 481, 55 Del. 481, 188 A.2d 510 (1963). This Court, however, has previously ordered dismissal of an action even though the plaintiffs were then prosecuting their claim. In Simkins, the plaintiff's inactivity lasted eight years when it suddenly served a garnishment and requested a trial *428 date be set. The defendant moved to dismiss for failure to prosecute and the circuit court denied the motion. We remanded with directions to enter an order of dismissal, and in so doing, we determined that present counsel's diligence did not correct prior derelictions. Here, too, we determine that present counsel's attempts to move the case forward do not correct the prior derelictions.
Fifth, and finally, Aukerman and Mazourek assert that the legal policy of disposing of litigation on the merits outweighs the policy against stale claims and that they should be allowed to proceed with their claim. Daley. Whatever the validity of this contention, we hold that Aukerman's and Mazourek's inactivity has lasted too long to allow the continuation of this case. This third-party action to recover costs and attorney fees incurred in defending Duncan's primary action was begun in March 1976, and the extent of those costs and fees was resolved in September 1979. At the time of the motion to dismiss herein, more than eight years had passed since Aukerman and Mazourek began this third-party action, and more than five years had passed since all the information needed for trial had become available. We have previously affirmed motions to dismiss for failure to prosecute or ordered such dismissals where the inactivity lasted three years, Watkins; where the inactivity lasted four years, Potts, and Fox v. Perpetual Nat'l Life Ins. Co., 273 N.W.2d 166 (S.D.1978); and where the inactivity lasted eight years, Simkins. Under the circumstances herein presented, we are hard pressed to conclude that the circuit court abused its discretion when dismissing this slumbering action.
Accordingly, we affirm the circuit court's decision and thus end this case of antiquity. Inexcusable delay, as witnessed here, mires cases in our court system and cheats litigants of timely and just determinations. Such delay must be extracted like an impacted molar, lest it infect the judicial jawbone.
FOSHEIM, C.J., MORGAN and WUEST, JJ., and HERTZ, Circuit Judge, Acting as Supreme Court Justice, concur.
NOTES
[*] We also note that SDCL 15-11-11 provides: "The court may dismiss any civil case for want of prosecution upon written notice to counsel of record where there has been no activity for one year, unless good cause is shown to the contrary." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582491/ | 329 N.W.2d 865 (1983)
213 Neb. 513
Terry Smith CARADORI, Appellee and Cross-Appellant,
v.
FRONTIER AIRLINES, INC., Appellant and Cross-Appellee.
No. 82-208.
Supreme Court of Nebraska.
February 11, 1983.
*866 Baylor, Evnen, Curtiss, Grimit & Witt, Lincoln, for appellant and cross-appellee.
Spencer W. Dillon, Omaha, for appellee and cross-appellant.
KRIVOSHA, C.J., BOSLAUGH, McCOWN, WHITE, HASTINGS, and CAPORALE, JJ., and COLWELL, District Judge, Retired.
WHITE, Justice.
Appellee resided in Omaha, Nebraska, from January of 1978 until September of 1978. From September of 1978 until June of 1979 she resided in Denver, and in June of 1979 she returned to Omaha. On February 8, 1979, appellee was a flight attendant for Frontier Airlines, Inc., with her employment base of operations in Denver, Colorado. She was working on a Frontier Airlines flight from Denver to Kansas City, Missouri, when the plane suddenly veered and she fell off balance and received the back injury complained of. The appellee has a previous history of back injury, the most worthy of note being a 1978 incident. The Workmen's Compensation Court made an award and the employer appeals.
A number of issues are raised by appellant: (1) The scope of the jurisdiction of the Workmen's Compensation Court under Neb.Rev.Stat. § 48-115(2)(b) (Reissue 1978); (2) If we find that the compensation court had jurisdiction, whether an action based on these same facts filed in another state requires the Nebraska action to be abated, or stayed; (3) Whether the acceptance of benefits under the Colorado workmen's compensation law precluded recovery under Nebraska law; and (4) Whether the compensation court erred in finding that Caradori's disability arose out of and in the course of her employment by Frontier Airlines, Inc.
In view of our decision in this case, we will discuss only the fourth assignment of error.
It is well settled that findings of fact made by the Workmen's Compensation Court on rehearing have the same force and effect as a jury verdict in a civil case and, if supported by sufficient evidence, will not be disturbed on appeal unless clearly wrong. Renshaw v. Merrigol-Adler Bakery, 212 Neb. 662, 325 N.W.2d 46 (1982).
Essentially, the question which arises in this case is the same one which has with increasing frequency arisen in other compensation court appeals, namely, whether there has been sufficient proof of medical causation to establish that the disability is the result of an accident arising out of as well as in the course of employment. The medical evidence establishes that Caradori suffers from the effects of a cervical sprain with attendant pain and suffers a disability which the compensation court determined to be 10 percent of the body as a whole.
The testimony offered by Caradori relating to causation is by Dr. Louis Tribulato, an orthopedist, as follows: "Q. Regarding the history that she gave you of the two injuries, do you feel that these, her current condition, could have been caused by those injuries? A. Yes. MR. ZINC: Obtain [sic] as no proper and sufficient foundation. Go *867 ahead. BY MR. DILLON: Q. And would you state this conclusion based upon your skill, training and experience and with reasonable medical certainty? A. Yes."
Dr. John Goldner, a neurologist, testified that, with reasonable medical certainty, a cervical nerve impingement could have been caused by the first or second accident.
None of the physicians, whether testifying for Frontier Airlines or Caradori, stated that, in their opinion, Caradori's disability was the result of an accident arising out of as well as in the course of employment.
This is a difficult case. Whether by accident or design, counsel omitted asking expert medical opinion on causation. We are not free to retry cases on appeal, or to speculate on the answers treating physicians might have given to questions not asked.
Neb.Rev.Stat. § 48-101 (Reissue 1978) provides in part that "When personal injury is caused to an employee by accident or occupational disease, arising out of and in the course of his or her employment, such employee shall receive compensation therefor...." (Emphasis supplied.)
In Smith v. Stevens, 173 Neb. 723, 725-26, 114 N.W.2d 724, 726 (1962), this court stated that "The burden of proof is upon the plaintiff to prove an accident arising out of and in the course of his employment and the disability resulting therefrom. Plaintiff must show a causal connection between the accident suffered by him and the alleged disability." Although the Smith decision was rendered under a de novo review and not the present clearly erroneous standard, its logic remains applicable to the facts in the present case.
Also, in Mack v. Dale Electronics, Inc., 209 Neb. 367, 370, 307 N.W.2d 814, 816 (1981), we said: "`Where the claimed injuries are of such a character as to require skilled and professional persons to determine the cause and extent thereof, the question is one of science. Such a question must necessarily be determined from the testimony of skilled professional persons and cannot be determined from the testimony of unskilled witnesses having no scientific knowledge of such injuries.' The employee must show by competent medical testimony a causal connection between the alleged injury, the employment, and the disability."
An award of compensation may not be based on possibilities or speculative evidence. Welke v. City of Ainsworth, 179 Neb. 496, 138 N.W.2d 808 (1965). Thus, the mere possibility that a disability arose out of and in the course of employment does not satisfy the claimant's burden of proof.
The claimant, Caradori, having only proved that the disability could have been caused by an accident arising out of and in the course of employment has not sustained her burden of proof. The award must be reversed and the cause remanded with directions to dismiss the petition.
REVERSED AND REMANDED WITH DIRECTIONS TO DISMISS. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582497/ | 976 F. Supp. 1190 (1997)
Cheryl K. McPHAUL, Plaintiff,
v.
BOARD OF COMMISSIONERS OF MADISON COUNTY, Defendant.
No. IP 97-97 CB/S.
United States District Court, S.D. Indiana, Indianapolis Division.
July 28, 1997.
Roy D. Rogers, Haskin Lauter Cohen & Larue, Indianapolis, IN, for Plaintiff.
Nelson A. Nettles, Norris Choplin & Schroeder, Indianapolis, IN, for Defendant.
ENTRY DISCUSSING MOTION TO DISMISS
BARKER, Chief Judge.
I. BACKGROUND
Plaintiff, Cheryl K. McPhaul ("McPhaul") is suing Defendant, the Board of Commissioners of Madison County ("the Board"), for unlawfully discriminating against her because of her race and disability, in violation of the Americans With Disabilities Act of *1191 1990, 42 U.S.C. § 12101 et seq., as amended by 42 U.S.C. § 1981a, and the Civil Rights Act of 1870, 42 U.S.C. § 1981.
McPhaul is an African-American woman formerly employed in the Madison County Health Department WIC (women, infants, and children) division, (hereinafter, "WIC") from April 4, 1994 until her discharge on January 22, 1996. A Registered Nurse, McPhaul was originally employed in the Health Department as a nutritionist and was one of two African-American employees in WIC. The other employee allegedly left approximately one year after McPhaul's arrival due to a decrease in her hours. McPhaul contends that WIC did not hire any other African-Americans after this employee's departure.
McPhaul alleges that less than a year after she began working at the Health Department, she was diagnosed with colon cancer. In February 1995, she underwent surgery to treat the cancer, and consequently did not work through most of February and March of that year. McPhaul maintains that when she returned to work, she worked as a nutritionist for another month before WIC transferred her to an intake position.
While working intake, McPhaul allegedly experienced hostile treatment by her co-workers. She maintains that Marsha Shock ("Shock"), a white woman also working in intake, continually used racially derogatory terms in McPhaul's presence, including the word "nigger." Although McPhaul repeatedly complained to the WIC Program Coordinator, Arleen Horine ("Horine"), Ms. Shock's behavior did not abate, and Horine allegedly told McPhaul that she should overlook Shock's comments.
McPhaul also alleges that while she was having problems with Shock, she was experiencing additional physical problems, including extreme fatigue. When she asked Horine for a reduction in hours, Horine refused, explaining that because Shock's hours had already been reduced, she could not accommodate a second, similar request. At this time, McPhaul maintains that she also began to receive adverse personnel evaluations.
When McPhaul's doctors could not successfully pinpoint the cause of her fatigue, she went to the Mayo Clinic in Rochester, Minnesota in January 1996, where she was diagnosed with asthma, bacterial endocarditis, and fybromyalgia. McPhaul contends that when she tried to return to work after her visit, Horine refused to accept the Mayo Clinic's written diagnostic assessment of McPhaul's ailments. To return to work, McPhaul was told that she had to obtain a second statement from the clinic, necessitating a request to Mayo's that a second report be FAXed to WIC.
Shortly thereafter, McPhaul received her third adverse personnel evaluation and was notified that she would be terminated due to unsatisfactory performance. McPhaul alleges that this reason for her termination is purely pretextual.
McPhaul invokes the protection of 42 U.S.C. § 1981 in Count I of her complaint, maintaining the Board of Commissioners unlawfully discriminated against her because of her race. She alleges four instances of disparate treatment based on racial discrimination which she argues are actionable under § 1981:(1) her transfer from a nutritionist position to an intake position; (2) her placement on a 90-day evaluation period; (3) the denial of her request for a reduction in hours; and (4) her final discharge. She also alleges that she was required to work in a racially hostile environment. On this basis, McPhaul seeks an award of compensatory as well as punitive damages.
In Count II, McPhaul alleges that the four, above enumerated actions of disparate treatment were also based on her disabilities, in violation of the Americans With Disabilities Act of 1990 ("ADA"), but does not seek punitive damages under this Count.
II. LEGAL STANDARDS
When considering a motion to dismiss, the Court examines the sufficiency of the complaint, not the merits of the lawsuit. Triad Assocs. v. Chicago Hous. Auth., 892 F.2d 583 (7th Cir.1989), cert. denied, 498 U.S. 845, 111 S. Ct. 129, 112 L. Ed. 2d 97 (1990). Dismissal of a complaint is appropriate only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations in the complaint. Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. *1192 2229, 2232-33, 81 L. Ed. 2d 59 (1984) (citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S. Ct. 99, 101-02, 2 L. Ed. 2d 80 (1957)). We accept as true all well-pleaded factual allegations and draw all reasonable inferences in favor of the plaintiff. Dawson v. General Motors Corp., 977 F.2d 369, 372 (7th Cir.1992). See also Jones v. General Elec. Co., 87 F.3d 209, 211 (7th Cir.1996). On a motion to dismiss, the Court limits its inquiry to the pleadings.
III. ANALYSIS
In its Motion to Dismiss, Defendant first argues that government entities are not subject to liability under 42 U.S.C. § 1981. Citing Jett v. Dallas Independent School District, 491 U.S. 701, 735, 109 S. Ct. 2702, 2723, 105 L. Ed. 2d 598 (1989), Defendant argues that the exclusive federal damages remedy against a state actor for violation of § 1981 is available only under § 1983. Defendant contends that because McPhaul brought her race discrimination claim under the wrong statute, her claim must be dismissed. Plaintiff, in turn, maintains that Jett has been superseded by the 1991 Civil Rights Act and that federal damages claims now can be brought against state actors under § 1981.
Section 1981 provides that "all persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts ... as is enjoyed by white citizens." 42 U.S.C. § 1981(a).[1] Originally, § 1981 did not create a cause of action that would allow a plaintiff to obtain damages for substantive violations of § 1981 by state actors. Johnakin v. City of Philadelphia, No. 95-1588, 1996 WL 18821 at 1 (E.D.Pa., Jan.18, 1996). See also Jett, 491 U.S. at 721, 109 S.Ct. at 2715-16. Only § 1983 allowed plaintiffs to secure damages against state actors. Section 1983 states: "Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State ... subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress." 42 U.S.C. § 1983. Section 1983 thus created a cause of action against any person acting under color or state law who was responsible for a deprivation of constitutional rights. Philippeaux v. North Central Bronx Hosp., 871 F. Supp. 640, 652 (S.D.N.Y.1994).
The Supreme Court applied these rules in reaching its decision in Jett, where a white male teacher assigned to teach at a predominantly African-American high school brought suit against the school district under § 1981 and § 1983. Justice O'Connor held that a municipality may not be held liable for its employee's § 1981 violations under a respondeat superior theory § 1983 was the express "action at law" provided for the violation of rights guaranteed in § 1981. Jett, 491 U.S. at 733, 109 S.Ct. at 2721-22. Subsequently, courts have regularly applied Jett for the principle that "... the express `action at law' provided by § 1983 for the `deprivation of any rights, privileges, or immunities secured by the constitution and laws,' provides the exclusive federal damages remedy for the violation of rights guaranteed by § 1981 when the claim is pressed against a state actor." Maldonado v. Metra, 743 F. Supp. 563, 566 (N.D.Ill.1990) (citing Jett, 491 U.S. at 733-35, 109 S.Ct. at 2722).
However, in 1991, Congress passed the Civil Rights Act which amended § 1981 by adding subsections (b) and (c) to the statute. See Johnakin, 1996 WL 18821 at 3.[2] Section 1981(c) specifies that "[t]he rights protected by [§ 1981] are protected against impairment by nongovernmental discrimination and impairment under color of State law." 42 U.S.C. § 1981(c). See also Johnakin, 1996 WL 18821 at 3. In determining whether § 1981(c) overrules the holding in Jett, courts' decisions have varied widely.
Plaintiff cites a number of cases which support her argument that the 1991 Amendments to the Civil Rights Act overruled Jett, thus allowing a direct cause of action under § 1981 against state actors. The court in Gallardo v. Board of County Commissioners, 857 F. Supp. 783 (D.Kan.1994) reasoned that because Congress borrowed the "under color of State law" language from § 1983, it "presumably *1193 intended to borrow also the rules of municipal liability under § 1983". Gallardo, 857 F.Supp. at 786. The Gallardo court reasoned, "Indeed, Congress made no attempt in the amendment to differentiate municipal liability under § 1981 from § 1983." Gallardo, 857 F.Supp. at 786.
Many courts have ruled that by adding subsection (c) to § 1981, Congress was actually making it clear that both section 1983 and section 1981 may be utilized to redress discriminatory state action. See La Compania Ocho, Inc. v. U.S. Forest Serv., 874 F. Supp. 1242, 1250 (D.N.M.1995); see also Gallardo, 857 F.Supp. at 786. Several other courts, having issued blanket rulings to the effect that the amendment to § 1981 overruled Jett, did so without elaborating on their reasoning. See Jackson v. City of Chicago, No. 96 C 3636, 1996 WL 734701 at 8 (N.D.Ill. Dec.18, 1996); Morris v. Kansas Dept. of Revenue, 849 F. Supp. 1421, 1426 (D.Kan. 1994); Arnett v. Davis County Sch. Dist., No. 92-C-988W, 1993 WL 434053 at 5 (D.Utah Apr.5, 1993); Ford v. City of Rockford, No. 88-C-20323, 1992 WL 309603 (N.D.Ill. Oct.15, 1992); Robinson v. Town of Colonie, 878 F. Supp. 387, 405 (N.D.N.Y. 1995).
Defendant cites a line of cases which support its argument that Jett was not overruled by § 1981(c) and that therefore Plaintiff's § 1981 claim should be dismissed for failing to state a cause of action. In a footnote, the court in Dennis v. County of Fairfax, 55 F.3d 151, 155, n. 1 (4th Cir.1995) held that the portion of Jett which specifies the appropriate statute for bringing claims against municipalities was not affected by the 1991 Civil Rights Act, and explains further that the purpose of the addition of subsection (c) was not to overrule Jett but to codify the holding of the Supreme Court in Runyon v. McCrary, 427 U.S. 160, 96 S. Ct. 2586, 49 L. Ed. 2d 415 (1976).[3]See also Philippeaux, 871 F.Supp. at 655; Johnson v. City of Fort Lauderdale, Florida, 903 F. Supp. 1520, 1523 (S.D.Fla.1995) (where the court refers to the lack of legislative history supporting the theory that Congress intended to overrule Jett, and "declines to find such an intention without clear statutory language to that effect.")
The Seventh Circuit has not yet directly addressed this issue. Thus, it is left to us to determine whether Jett was, in fact, overruled or supplanted by § 1981(c). The explanations supplied by the courts which have ruled that the first part of Jett no longer applies are largely unsupported by legislative history and in our view apply faulty logic. For example, the court in Gallardo bases its ruling on the significance of § 1981(c) language, borrowed from § 1983, to wit, "under color of State law." 42 U.S.C. § 1981(c). Gallardo, 857 F.Supp. at 786. However, as explained in Philippeaux, "The language that gave rise to municipal liability was not the phrase "under color of state law," which merely provides for the liability of individuals who take action under color of state law." Philippeaux, 871 F.Supp. at 655. See also Jett, 491 U.S. at 719-21, 109 S.Ct. at 2714-16 (discussing scope of liability based on the language "under color of any law" in Section 2 of the 1866 Act.). Inasmuch as the borrowed phrase does not carry the meaning ascribed to it by the Gallardo court, its inclusion in § 1981(c) should not be read to invent a new cause of action under § 1981. Furthermore, when Congress borrows a phrase from another statute, it does not always follow that Congress necessarily intended to borrow the whole meaning of the parent statute.
In truth, § 1981's legislative history more convincingly supports the conclusion that subsection (c) had no effect on Jett and that Jett did not play any role in prompting Congress to amend § 1981. At no time, for instance, either in the floor debate or in the official summaries preceding the enactment of § 1981(c), was mention made of the Jett decision. Philippeaux, 871 F.Supp. at 655. The legislative history references subsection (c) only briefly, and then only in connection with Runyon v. McCrary, 427 U.S. 160, 96 S. Ct. 2586, 49 L. Ed. 2d 415 (1976) (see supra, n. 3). As the Philippeaux court points out, it would be inconsistent for Congress, while *1194 expressly codifying the holding of Runyon, to overrule Jett only by implication, thereby eroding the "bedrock of municipal liability." Philippeaux, 871 F.Supp. at 656, n. 9.
For these reasons, we find that Jett was not overruled by the Civil Rights Act of 1991 and accordingly § 1983 remains the sole avenue of relief against state actors for violations of § 1981. Plaintiff, therefore, may not bring her claim in this lawsuit against the Defendant Commissioners under § 1981. Defendant's motion to dismiss is granted, and Plaintiff's § 1981 claim in Count I is dismissed without prejudice.[4] Plaintiff's ADA claim, as advanced in Count II, is unaffected by this ruling.[5]
NOTES
[1] § 1981(a) is the entirety of the statute prior to the 1991 amendments.
[2] Section (b) of § 1981 is not pertinent to this decision.
[3] Runyon held that § 1981 protects rights from private discrimination as well as from discrimination by state actors. See Federation of African American Contractors v. City of Oakland, 96 F.3d 1204, 1212 (9th Cir.1996).
[4] Defendant also moved to dismiss Plaintiff's claim for punitive damages under § 1981. Because we have dismissed plaintiff's § 1981 claim, we need not address the question whether punitive damages are available under § 1981. Assuming Plaintiff refashions her § 1981 claim in Count I as a § 1983 claim, a punitive damage claim may be sustainable.
[5] Defendant also argued in its motion to dismiss that punitive damages are unavailable under the ADA and her claim for such should be dismissed. In her Response to Defendant's motion, Plaintiff has clarified that she is not seeking punitive damages on her ADA claim, so the Court regards this issue as moot. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1918862/ | 411 B.R. 496 (2009)
In the matter of Miguel C. CAMACHO, Debtor
Pearl Hebbard, Plaintiff
v.
Miguel C. Camacho, Defendant.
Bankruptcy No. 08-40960. Adversary No. 08-4054.
United States Bankruptcy Court, S.D. Georgia, Savannah Division.
May 14, 2009.
*499 Jeffrey M. Harvey, Law Office of Jeffrey Morton Harvey, LLC, Louisville, GA, Ramsey Austin Knowles, Taylor English Duma, LLP, Toronda M. Silas, Taylor, Busch, Slipakoff & Duma LLP, Atlanta, GA, for Plaintiff.
Barbara B. Braziel, Savannah, GA, Richard C.E. Jennings, Law Offices of Skip Jennings, PC, Savannah, GA, for Defendant.
MEMORANDUM AND ORDER ON PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
LAMAR W. DAVIS, JR., Bankruptcy Judge.
Defendant, Miguel G. Camacho ("Debtor"), filed Chapter 7 on May 30, 2008. On September 2, 2008, Plaintiff filed an Adversary Proceedings pursuant to 11 U.S.C. § 523(a)(2) and (6) for the purpose of determining whether the indebtedness owed by Debtor to the Plaintiff is nondischargable. *500 After Debtor filed his answer, a pretrial conference was held, and discovery was conducted, Plaintiff filed a Motion for Summary Judgment on February 6, 2009. Debtor filed his Response on March 13, 2009. On March 24, 2008, Plaintiff replied to Debtor's response.
Plaintiff argues that a judgment entered by the Superior Court of Gwinnett County, Georgia in favor of Plaintiff and against Debtor for fraud and wrongful eviction "precludes dischargeability under the doctrine of collateral estoppel based on 11 U.S.C. § 523(a)(2), (6)-`false pretenses, a false representation, or actual fraud' and `willful and malicious injury by the debtor.'" Motion for Summary Judgment, Dckt.No. 14, pg. 1-2. For the following reasons, Plaintiff Pearl Hebbard's Motion for Summary Judgment is GRANTED.
On or about August 23, 2001, Plaintiff entered into a sales agreement to sell property located at 9013 Hightower Trail, Snellville, Gwinnett County, Georgia to Glass-Cam Commercial Developers, Inc. ("Glass-Cam") for $475,000.00 (the "Sale Agreement"). At the time Plaintiff and Glass-Cam entered into the Sale Agreement, Debtor was an officer and/or agent of Glass-Cam. Complaint, Dckt.No. 1, ¶ 6; Answer, Dckt.No. 4, ¶ 6. Following the execution, of the Sale Agreement, a dispute arose among Plaintiff, Glass-Cam and other related parties, and on March 26, 2003, Plaintiff instituted an action against Debtor and others to recover damages for fraud, breach of contract, wrongful eviction and other causes of action in the Superior Court of Gwinnett County, Case No. 03-A-03433-1. Complaint and Answer, ¶ 7.
Debtor filed an answer and participated for part of the Gwinnett litigation but did not appear at trial. Brief, Dckt.No. 18, pg. 1-2; Complaint and Answer, ¶ 8. Because Debtor failed to appear at trial, the Gwinnett Court struck Debtor's answer and entered judgment against Debtor for fraud, wrongful eviction and punitive damages on a default jury verdict. Complaint, ¶ 9; Response, Dckt.No. 18, pg. 1. Specifically, the Judgment on Verdict as to Plaintiffs fraud claim stated that judgment was entered "in favor of Plaintiff and against Defendant Miguel Camacho in the sum of $187,833.00 compensatory damages and $0.00 punitive damages." As to Plaintiffs wrongful eviction claim, judgment was entered "in favor of Plaintiff and against Defendant Miguel G. Camacho in the sum of $25,000.00 compensatory damages and $10,000.00 punitive damages. The jury found that Defendant did act with specific intent to cause harm." Complaint, Dckt. No. 1, Exhibit A.
STANDARD OF REVIEW
Summary judgment is appropriate when "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." Fed.R.Civ.Proc. 5(c); Celotex Corp. v. Catrett, 477 U.S. 317, 106 S. Ct. 2548, 2552, 91 L. Ed. 2d 265 (1986). Rule 56 of the Federal Rules of Civil Procedure applies to motions for summary judgment in bankruptcy adversary proceedings. See Fed.R.Bankr. Proc. 7056. The party moving for summary judgment has the burden of demonstrating that no dispute exists as to any material fact. Adickes v. S.H. Kress & Co., 398 U.S. 144, 156, 90 S. Ct. 1598, 26 L. Ed. 2d 142 (1970). Once this burden is met, the nonmoving party must present specific facts that demonstrate that there is a genuine dispute over material facts. Finally a court reviewing a motion for summary judgment must examine the evidence in light most favorable to the nonmoving *501 party, and all reasonable doubts and inferences should be resolved in the favor of the non-moving party. In re Davis, 374 B.R. 362, 364 (Bankr.S.D.Ga. 2006).
DISCUSSION
The issue here is whether collateral estoppel as a matter of law precludes the discharge of Debtor's judgment against him. In the present case, Plaintiff brought the instant adversary proceeding claiming that the judgment of the State Court is excepted from discharge pursuant to 11 U.S.C. § 523(a)(2) and (6). Section 523 provides in pertinent part as follows:
(a) A discharge under section 717, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt
(2) for money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained, by
(A) false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor's or an insider's financial condition;
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity;
. . .
11 U.S.C. § 523(a)(2)and(6).
In Section 523(a) dischargeability actions, this Court recognizes the applicability of collateral estoppel. Chisholm v. Stevens (In re Stevens), 1996 WL 33401190 at *3 (Bankr.S.D.Ga. May 21, 1996) (Davis, J.); see Grogan v. Garner, 498 U.S. 279, 284, 111 S. Ct. 654, 112 L. Ed. 2d 755 n. ll (1991) ("collateral estoppel principles do indeed apply in discharge exception proceedings pursuant to § 523(a)."); In re Bilzerian, 100 F.3d 886, 892 (11th Cir. 1996); Bush v. Balfour Beatty Bahamas. Ltd. (In re Bush), 62 F.3d 1319, 1322 (11th Cir.1995): Hoskins v. Yanks (In re Yanks), 931 F.2d 42, 43 (11th Cir.1991); In re Latch, 820 F.2d 1163, 1164-65 (11th Cir.1987).
"Moreover, federal courts must give the same preclusive effect to prior judgments of state courts as those judgments have by `law or usage' in the courts of that state." In re Griffin, 1999 WL 33591982, at *2 (Bankr.S.D.Ga.1999)(Davis, J.)(citing 28 U.S.C. § 1738 (1994)). "Therefore, this Court must apply the law of the state of Georgia in order to determine the preclusive effect of the state court judgments against the Debtor." Id. (citing In re St. Laurent, 991 F.2d 672, 675 (11th Cir.1993)); see In re Bush, 62 F.3d at 1323 n. 6 (applying federal law to determine whether federal court default judgment had collateral estoppel effect and noting that state court judgment would be reviewed under law of that state). "While collateral estoppel may foreclose relitigation of issues decided in prior judicial proceedings, the ultimate issue of dischargeability is a legal question over which the bankruptcy court has exclusive jurisdiction." Id. (citing In re Halpern, 810 F.2d 1061 (11th Cir.1987)).
1. Collateral Estoppel under Georgia Law
Under Georgia law, a party may only assert the doctrine of collateral estoppel if the issue was (1) raised in a prior proceeding, (2) actually litigated and decided, and (3) necessary to final judgment. Boozer v. Higdon, 252 Ga. 276, 278, 313 S.E.2d 100, 102 (Ga.1984)("In order to successfully plead collateral estoppel, ... one must prove that the contested issues, even though arising out of a different claim, were actually litigated and decided and were necessary to the prior decision."); see also Kent v. Kent, 265 Ga. 211-12, 452 S.E.2d 764 (Ga.1995)("collateral estoppel *502 applies where an issue of fact or law is actually litigated and determined by a valid by a valid-judgment, and the determination is essential to the judgment.").
Plaintiff has easily proven factors 1 and 3: the default judgment issued by the Gwinnett Court was raised in a prior civil litigation and was necessary to the court and jury's final judgment which ultimately assigned liability for fraud and wrongful eviction to Debtor and his other co-defendants.
Debtor, however, asserts that the second factor above was not satisfied because his liability was not actually litigated and decided. Specifically, Debtor argues that he "participated in the litigation of the Gwinnett County case in the early stages. He paid an attorney to represent him in that case. During the years of litigation, Mr. Camacho found that he could no longer afford to pay his attorney to defend him against Plaintiffs lawsuit." Brief, Dckt. No. 18, pg. 3. Debtor also argued that he "could not afford to travel back and forth from Savannah to Gwinnett County to defend himself." Response, Dckt.No. 18, pg. 2. As a result, Defendant did not appear at the trial, thus his answer was stricken and a default judgment was entered against him.[1]
In the underlying state court case, Plaintiff specifically raised allegations of fraud as to Debtor. Debtor actively participated in the adversary process for "years." See Brief, Dckt.No. 18, pg. 3. He was represented by counsel. He answered the complaint. Yet, he elected not to appear at trial or defend the lawsuit. After the trial on the merits, the jury found Debtor liable for fraud. See Complaint, Dckt. No. 1, Exhibit A. This evidence undeniably establishes that the matters pertaining to fraud were actually litigated and decided in the state court.
*503 In light of the foregoing, this Court concludes that all the necessary requirements for the application of collateral estoppel under Georgia law are present in this proceeding, thus the doctrine of collateral estoppel will prevent Debtor from relitigating these factual issues.
Some decisions though have added another requirement to the analysis: that the party against whom preclusion is asserted must have had a "full and fair opportunity" to litigate.[2] Because of the origins of that element as noted in footnote 2, that element is not applied in this Order except to this extent. It should be self evident that the collateral estoppel could only arise out of a proceeding in which fundamental due process was accorded. That should always be an unspoken element for application of collateral estoppel. To the extent that courts have articulated the "full and fair opportunity" standard, I find that it requires nothing more than notice and an opportunity to be heard. That did not occur in In re Whelan because defendants were never served with an affidavit of damages and thus were not given an opportunity to contest damages before an order was entered against them. 236 B.R. 495, 508 (Bankr.N.D.Ga.1999) modified by Sterling Factors. Inc. v. Whelan (In re Whelan), 245 B.R. 698, 708-13 (N.D.Ga.2000). Indeed there is precedent for the notion that element is established if the "opportunity" was accorded to the defendant, and that a decision to disregard or avoid that opportunity does not negate it. See In re Hooks, 238 B.R. 880, 886-87 (Bankr.S.D.Ga. 1999)(Dalis, J.).
Here due process was accorded. Debtor knew about the case, had the opportunity to litigate, and did so for a time. He then decided not to participate for practical reasons, but not a reason which suggests that due process was not accorded to him.[3]
*504 2. Collateral Estoppel under Federal Law
Even though I have held that under Georgia law the doctrine of collateral estoppel prevents Debtor from relitigating these factual issues, it is also helpful to analyze whether collateral estoppel would apply under federal preclusion standards because both federal and Georgia law provide that collateral estoppel applies when the identical issue sought to be litigated in the action at bar was "actually litigated." See Brown v. Felsen, 442 U.S. 127, 139 n. 10, 99 S. Ct. 2205, 2213, 60 L. Ed. 2d 767 (1979) (stating federal preclusion requirements); In re Bush, 62 F.3d at 1322 (discussing federal preclusion); In re Barber, 316 B.R. 391, 393 (Bankr.M.D.Ga.2004)(Laney, J.)(discussing the state preclusion requirements); Boozer v. Higdon, 252 Ga. 276, 278, 313 S.E.2d 100, 102 (1984) (establishing the state preclusion requirements).
Under federal judgment issue preclusion, "the `actual litigation' requirement may be satisfied by showing substantial participation in an adversary contest in which the party is afforded a reasonable opportunity to defend himself on the merits but chooses not to do so.'" In re Bush, 62 F.3d at 1324 (quoting In re Daily, 47 F.3d 365, 368 (9th Cir.1995)). In the present case, Debtor did not simply give up at the outset. He actively participated in the adversary process for "years." See Brief, Dckt. No, 18, pg. 3. He was represented by counsel. He answered the complaint. However, he elected not to appear at trial or defend the lawsuit. Debtor's participation in the prior case was substantial. Therefore, even under the more stringent Federal rule, the fraud issue was "actually litigated" in the underlying state court action.
3. Mitigating Factors
Despite the fact that under Georgia law the default judgment issued by the Superior Court of Gwinnett County against Debtor meets all the requirements for collateral estoppel, Debtor argues that "[m]itigating factors are present in this case such that the application of collateral estoppel would not be in the interest of justice." Thus, Debtor asks this court to use its discretion and choose to decline applying issue preclusion in this case. Brief, Dckt.No. 18, pg. 4.
The Eleventh Circuit recognized that when applying federal preclusion standards "whether to allow issue preclusion is within the sound discretion of the trial court." It further stated
The presence of mitigating factors in another case might cause a court to exercise discretion to deny preclusion to a default judgment even if the doctrine's formal elements are otherwise met. In some cases, the amount of money at stake or the inconvenience of the forum might disincline a defendant to offer a defense. In the case of such an "ordinary" default, a subsequent court might decline to allow preclusion.
In re Bush, 62 F.3d at 1325 n. 8.
In arguing that mitigating factors are present, Debtor states:
Although there was a significant amount of money at stake in this case, Defendant did make his best efforts to participate in the Gwinnett County case until he could no longer afford to pay an attorney to represent him. Mr. Camacho *505 lives in Savannah; driving back and forth from Savannah to Gwinnett County is inconvenient and costly. Defendant could not afford to take time off of work to drive to Gwinnett County for frequent court hearings and thus was unable to represent himself in the Gwinnett County case.
Brief, Dckt.No. 18, pg. 4.
First, this "mitigating factors" argument only applies if federal preclusion standards govern, which is not the case here. Despite this, looking at the merits of Debtor's argument, I still do not find Debtor's argument persuasive. The amount of money at stake was substantial.[4]See Id.("there was significant money at stake in this case."). Also, as established above, Debtor did, in fact, substantially participate in the litigation. See In re Bush, 62 F.3d at 1325 n. 8.
Furthermore, application of collateral estoppel in this case is consistent with bankruptcy policy. Plaintiff has already litigated the question of Debtor's fraud. Debtor suffered a default judgment of fraud because he chose not to participate in the legal process. "To require Plaintiff to incur additional expense to litigate an issue which she has already pursued diligently is unreasonable and contrary to the Code's attention to both debtor and creditor rights." In re Hooks, 238 B.R. at 887.
Last, this decision accords proper deference to our Federal-State judicial system. The default judgment was issued by the Superior Court of Gwinnett County, Georgia. "Appeal of that judgment would appropriately proceed through the state court appellate system. The default judgment was not appealed. A bankruptcy court is not an alternate appellate court to a State court judgment." Id.
In sum, this Court holds that the judgment entered by the Superior Court of Gwinnett County, Georgia, in favor of Plaintiff and against Debtor, finding that fraud and wrongful eviction had been committed, and that damages awarded, collaterally estops Debtor from disputing that judgment and the nature of his conduct. However, as dischargeability was not expressly decided in that case that question remains a matter of exclusive bankruptcy jurisdiction.
4. Dischargeability
a. Fraud
"There is an identity of issues between the claim of fraud asserted in the Superior Court Case and dischargeability claim under § 523(a)(2)(A)." In re Cunningham, 355 B.R. 913, 918 (Bankr. N.D.Ga.2006). In order to prove that a debt was obtained by fraud under § 523(a)(2)(A), a creditor must show by a preponderance of the evidence: (1) that the debtor made a false representation with the intent to deceive the creditor; (2) that the creditor relied on the representation; (3) that the reliance was justified; and (4) that the creditor sustained a loss as a result of the representation. See In re Bilzerian, 100 F.3d 886, 892 (11th Cir. 1996); In re St. Laurent, 991 F.2d 672, 676 (11th Cir.1993). The tort of fraud under Georgia law requires: (1) a false representation made by the defendant; (2) which the defendant knew was false; (3) made with an intent to deceive the plaintiff; (4) justifiable and detrimental reliance by the plaintiff on such representation and (5) damages suffered by the plaintiff as a result. See Crawford v. Williams, 258 Ga. 806, 806, 375 S.E.2d 223, 224 (Ga.1989); Lister v. Scriver, 216 Ga.App. 741, 745, 456 S.E.2d 83, 86 (Ga.Ct.App.1995); Lykins v. Nationwide Mut. Ins. Co., 214 Ga.App. 577, 579, 448 S.E.2d 716, 717 (Ga.Ct.App. *506 1994). "The court finds the requirements for a fraud claim under Georgia law sufficiently identical to the elements requirement for a showing of fraud pursuant to 11 U.S.C. § 523(a)(2)(A) ..." Sterling Factors. Inc. v. Whelan (In re Whelan), 245 B.R. 698, 705-06 (N.D.Ga.2000); see also In re Hooks, 238 B.R. 880, 888 (Bankr.S.D.Ga.1999)(Dalis, J.).
b. Wrongful Eviction
Under 11 U.S.C. § 523(a)(6), a Chapter 7 discharge does not discharge a debtor from any debt "for willful and malicious injury by the debtor to another entity or to the property of another entity." In Kawaauhau v. Geiger, the Supreme Court narrowed the scope of Section 523(a)(6) in that the Court interpreted the statute such that "nondischargeability takes a deliberate or intentional injury, not merely a deliberate or intentional act that leads to injury." 523 U.S. 57, 61, 118 S. Ct. 974, 977, 140 L. Ed. 2d 90 (1998)(emphasis in original). The Court held that debts stemming from recklessly or negligently inflicted injuries will not be held nondischargeable under Section 526(a)(6). Id. at 64, 118 S. Ct. 974.
Since Geiger, courts have endeavored to articulate the precise standard to apply to determine whether an injury is willful and malicious. As I have previously noted, "engaging in a voluntary act with the desire to cause harm or the knowledge that injury will occur to a targeted person is sufficiently `willful and malicious.'" Henderson v. Woolley (In re Woolley), 288 B.R. 294, 301 (Bankr.S.D.Ga.2001)(Davis, J.)(citing Johnson v. Fors (In re Fors), 259 B.R. 131, 136 (8th Cir. BAP 2001)). Engaging in a voluntary act with the belief that harm is substantially certain to occur is also sufficiently willful and malicious. Further an injury is willful and malicious when there is objective substantial certainty of harm or a subjective motive to cause harm. Id.; see also In re Rowland, 316 B.R. 759, 763-64 (Bankr.S.D.Ga. 2004)(Davis, J.).
According to the Judgment on Verdict as to Plaintiff's wrongful eviction claim, judgment was entered "in favor of Plaintiff and against Defendant Miguel G. Camacho in the sum of $25,000.00 compensatory damages and $10,000.00 punitive damages. The jury found that Defendant did act with specific intent to cause harm." Debtor proposes that the jury's award for wrongful eviction is sufficient to satisfy § 523(a)(6). I agree for the following two reasons.
First, the jury found that Debtor had specific intent to cause Debtor harm in the wrongful eviction action. According to my previous decision In re Rowland, "an injury is willful and malicious when there is... a subjective motive to cause harm." 316 B.R. 759, 763-64 (Bankr.S.D.Ga. 2004)(Davis, J.); see also Henderson v. Woolley (In re Woolley), 288 B.R. 294, 301 (Bankr.S.D.Ga.2001)(Davis, J.)("if a debtor commits an intentional act and he or she can be shown to have actually intended harm, or if that act was substantially certain to result in harm, then the Geiger standard is met.").
Second, "[p]unitive damages may be awarded [in Georgia] only in such tort action in which it is proven by clear and convincing evidence that the defendant's action showed willful misconduct, malice, fraud, wantonness, oppression, or that entire want of care which would raise the presumption of conscious indifference to consequences." O.C.G.A. § 51-12-5.1; see Scott v. Battle, 249 Ga.App. 618, 621, 548 S.E.2d 124 (Ga.Ct.App.2001)("In Georgia, the purpose of punitive damages is to deter the repetition of reprehensible conduct by the defendant ...") (citing Hosp. Auth. of Gwinnett County v. Jones, 261 Ga. 613, 614(1), 409 S.E.2d 501 (Ga.1991)(footnotes omitted)). Absent willful misconduct, malice, *507 fraud, wantonness, or oppression, there can be no recovery of punitive damages. Colonial Pipeline Co. v. Brown, 258 Ga. 115, 118, 365 S.E.2d 827 (Ga.1988)("Negligence, even gross negligence, is inadequate to support a punitive damage award."); Lamb v. State Farm Mut. Auto Ins. Co., 240 Ga.App. 363, 365, 522 S.E.2d 573, 575-76 (1999); Davis v. Southern Exposition Management Co., 232 Ga.App. 773, 776, 503 S.E.2d 649, 652 (Ga.Ct.App.1998).
ORDER
Pursuant to the foregoing, IT IS THE ORDER OF THIS COURT that summary judgment for the Plaintiff on the question of dischargeability under 11 U.S.C. § 523(a)(2) and (6) is GRANTED. The March 3, 2008, judgment by the Superior Court of Gwinnett County, Georgia, in the amount of $222,833.00 is determined to be non-dischargeable.
NOTES
[1] Though collateral estoppel can apply to dischargeability proceedings, res judicata can not. In Brown v. Felsen, the Supreme Court held that litigants could not preclude the litigation of bankruptcy dischargeability claims by relying upon state court judgments. 442 U.S. 127, 138-39, 99 S. Ct. 2205, 60 L. Ed. 2d 767 (1979).
Collateral estoppel, or "issue preclusion" differs from res judicata in that it does not bar adjudication of the ultimate merits of a claim. Instead, it only precludes re-litigation of discrete issues which have a bearing on the outcome of subsequent cases. So [the fraud] issue which was decided in [the Georgia state court] need not be re-litigated in [this Courtjj but the prior determination of [fraud] is not ultimately dispositive of [dischargeability].
In re Williams, 282 B.R. 267, 272 n. 2 (Bankr.N.D.Ga.2002); see also Jones v. Martin (In re Martin), 2000 WL 33958187, at *2 n. 1 (Bankr.S.D.Ga. Aug. 24, 2000)(Davis, J.).
However, the res judicata statute does provide insight into applying collateral estoppel under Georgia law. Two Georgia statutes recognize the conclusive effect of judgments by providing as follows:
A judgment of a court of competent jurisdiction shall be conclusive between the same parties and their privies as to all matters put in issue or which under the rules of law might have been put in issue in the cause wherein the judgment was rendered until the judgment is reversed or set aside. O.C.G.A. § 9-12-40
Where the merits were not and could not have been in question, a former recovery on purely technical grounds shall not be a bar to a subsequent action brought so as to avoid the objection fatal to the first. For a former judgment to be a bar to subsequent action, the merits of the case must have been adjudicated. O.C.G.A. § 9-12-42
"A judgment of default is a `judgment on the merits' for purposes of § 9-12-42 ..." In re Griffin, 1999 WL 33591982, at *2 (Bankr. S.D.Ga. June 24, 1999)(Davis, J.)(citing Butler v. Home Furnishing Co., 163 Ga.App. 825, 825, 296 S.E.2d 121 (Ga.Ct.App.1982); Fierer v. Ashe, 147 Ga.App. 446, 249 S.E.2d 270 (Ga.Ct.App.1978)). Since collateral estoppel establishes a narrower bar to subsequent litigation, logically a judgment of default is a "judgment on the merits" for the purpose of collateral estoppel as well.
[2] The "full and fair opportunity" requirement originated in the 1996 bankruptcy decision League v. Graham (In re Graham), 191 B.R. 489 (Bankr.N.D.Ga.1996). Graham cited two Georgia Court of Appeals cases for the requirement: Winters v. Pund, 179 Ga.App. 349, 352, 346 S.E.2d 124 (Ga.Ct.App.1986) and Watts v. Lippitt, 171 Ga.App. 578, 579, 320 S.E.2d 581 (Ga.Ct.App.1984). At the time of the 1996 decision, those two cases were good law. However, those cases were overturned in 1997 by the Georgia Court of Appeals in Wickliffe v. Wickliffe Co., 227 Ga.App. 432, 489 S.E.2d 153 (Ga.Ct.App.1997) cert. denied (Jan. 5, 1998). After 1997, those cases were never cited by any Georgia state court requiring the "full and fair opportunity" factor in analyzing collateral estoppel. As a result. I now question whether this remains a factor that the movant must prove to establish collateral estoppel. Nevertheless, it has been articulated as an element in later cases, including this Court. See e.g., Sterling Factors, Inc. v. Whelan (In re Whelan), 245 B.R. 698, 704-05 (N.D.Ga.2000)(Forrester, J.); In re Cunningham, 355 B.R. 913. 918 (Bankr.N.D.Ga.2006)(Bihary, J): In re Sanders, 315 B.R. 630, 633-34 (Bankr.S.D.Ga. 2004)(Davis, C.J.); In re Williams, 282 B.R. 267, 272 (Bankr.N.D.Ga.2002)(Mullins, J.); Ozburn v. Moore (In re Moore), 2001 WL 1855340, at *3 (Bankr.M.D.Ga. March 8, 2001)(Hershner, C.J.); Jones v. Martin (In re Martin), 2000 WL 33958187, at *2 (Bankr. S.D.Ga. Aug. 24, 2000)(Davis, J.). In re Whelan, 236 B.R. 495, 501 (Bankr.N.D.Ga.1999)(Bihary, J.); In re Hooks, 238 B.R. 880, 884 (Bankr.S.D.Ga.1999)(Dalis, C.J.); Dement v. Gunnin (In re Gunnin), 227 B.R. 332, 336 (Bankr.N.D.Ga.1998)(Bihary, J); In re Pope, 209 B.R. 1015, 1021 n. 7 (Bankr.N.D.Ga.1997)(Drake, J.); Utica Mutual Insurance. Co. v. Johnson (In re Johnson), 203 B.R. 1017, 1023 (Bankr.S.D.Ga. 1997)(Dalis, C.J.); Wilcox, M.D. v. Hritz (In re Hritz), 197 B.R. 702, 705 (Bankr.N.D.Ga.1996)(Cotton, C.J.); In re Selmonosky, 204 B.R. 820, 826 (Bankr.N.D.Ga.1996)(Brizendine, J.); League v. Graham (In re Graham), 191 B.R. 489, 495 (Bankr.N.D.Ga.1996)(Drake, J.).
[3] Debtor also chose not to defend in the underlying state court action despite the foreseeability of the conclusive effect of his decision to withdraw. See In re Bush, 62 F.3d at 1325("Justice ... is probably better served if... collateral estoppel does not apply to ... default judgments ... unless ... the parties could reasonably have foreseen the conclusive effect of their actions.") (citation omitted). Debtor may therefore be held to the consequences of the default judgment in this bankruptcy proceeding without offending due process.
[4] The compensatory damages were over $200,000. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582319/ | 329 N.W.2d 1 (1983)
The COMMITTEE ON PROFESSIONAL ETHICS AND CONDUCT OF THE IOWA STATE BAR ASSOCIATION, Complainant,
v.
Larry J. O'CONNOR, Respondent.
No. 67724.
Supreme Court of Iowa.
January 19, 1983.
Rehearing Denied February 10, 1983.
Lee H. Gaudineer and Karen Shaff, Des Moines, for complainant.
Larry J. O'Connor, Waterloo, pro se.
Considered en banc.
CARTER, Justice.
This matter is before us for review of the decision of the Grievance Commission of the court recommending disciplinary action against respondent, Larry J. O'Connor. The Committee on Professional Ethics and Conduct filed a complaint charging respondent with several violations of the Iowa Code of Professional Responsibility for Lawyers. The matter was heard before the seventh division of the Grievance Commission which recommended suspension of respondent's license to practice law. Pursuant to Court Rule 118.10, we determine anew the appropriate discipline, if any, to be imposed. On our review of the record, we conclude that the serious violations which have been established warrant revocation of respondent's license to practice law.
Respondent is charged with unethical conduct in six separate counts involving four clients, Schoitz Memorial Hospital, Joan Osborn, James McCool, and If and When, Inc. The charges involving James McCool and If and When, Inc. both involve alleged conflicts of interest in respondent's representation of his clients. In the McCool matter, respondent purported to be representing James McCool's former wife in a proposed modification of the parties' dissolution of marriage decree while simultaneously representing James on a driving while intoxicated charge. In the If and When, Inc. matter, respondent formed a corporation with that name supposedly representing all of the shareholders and is accused of favoring the interests of certain shareholders over the interests of others in regard to certain corporate transactions. Because we find the evidence to be somewhat inconclusive in regard to the alleged breaches of professional responsibility, if any, by respondent in the McCool and If and When, Inc. matters, we give these transactions no weight in reaching our ultimate decision. The charges against respondent which do bear on our decision in this matter involve misappropriation of the funds of clients Schoitz Memorial Hospital and Joan Osborn. We separately consider these transactions.
I. Schoitz Memorial Hospital.
In June of 1978, Schoitz Memorial Hospital retained respondent to assist it in the collection of delinquent accounts. The party *2 acting for the hospital in initiating this transaction was assistant hospital administrator Claire Canfield. It appears without dispute that the fee arrangement agreed to by Mr. Canfield and respondent at this time was a percentage fee fixed at twenty-five percent of the amount collected.
Between June of 1978 and May of 1980, the total sum of $3258.79 was paid to respondent by obligors of these delinquent accounts and, in addition, the sum of $2915.76 was paid directly to the hospital by said obligors. It is not disputed that the base upon which respondent's percentage fee was to be computed is the sum of these figures or $6174.55. Prior to the time of the filing of the complaint against respondent in this disciplinary proceeding, the only remittance made by respondent to the hospital for its share of the account payments which had come into his hands was the sum of $556.13 remitted to the hospital on November 10, 1978, with an explanation that it represented seventy-five percent of collections which had been received up to that time.
In mid-November of 1978, Mr. Canfield left his employment with the hospital. His successor arranged to have the Waterloo Credit Bureau handle its collections, and on September 27, 1979, wrote to respondent advising him that he would no longer be handling the hospital collection business. This letter requested that hospital accounts turned over to respondent for collection now be delivered by him to the credit bureau, together with the pertinent files. The hospital offered in this letter to reimburse respondent for any expenses he had incurred in the handling of the accounts which were to be transferred to the credit bureau. Subsequently, Mr. Raymond Burfiend, associate administrator of the hospital, requested an accounting from respondent with respect to hospital funds, if any, in his possession as a result of his collection efforts.
When the requested accounting was not forthcoming, the files were not transferred to the credit bureau, and respondent neglected to return Mr. Burfiend's telephone calls, the hospital retained another Waterloo attorney to attempt to obtain respondent's cooperation. Beginning in April of 1980, that attorney attempted to obtain from respondent the desired accounting and transfer of the files with no success. After several oral and written demands were ignored, he contacted the Client Security and Attorney Disciplinary Commission about the matter. That contact resulted in a preliminary audit of respondent's trust account by that commission on May 7, 1980.
When questioned by the commission auditor, respondent stated that he had kept the hospital informed of the status of its accounts by periodic telephone calls to a hospital employee named Elinor Kock. Respondent told the auditor that during these conversations, he was advised by Ms. Kock that several obligors of the accounts respondent was collecting had made payments directly to the hospital; that when these payments were reconciled with the sums paid to respondent, it resulted in the hospital owing him money. When pressed for an accounting of the payments upon which this assertion was based, respondent sought to support such claims by means of a fee entitlement of fifty percent of amounts collected. When pressed by the auditor for documentation of a fifty percent fee agreement with the hospital, respondent said that he had a letter to that effect but could not locate it. In contrast to respondent's claims to the auditor, Elinor Kock denied that respondent had ever discussed the status of these accounts with her, and the hospital produced a letter confirming a twenty-five percent fee arrangement with respondent.
Following the May 7, 1980, preliminary audit by the Client Security and Attorney Disciplinary Commission, that commission and the hospital, each working independently of the other, determined that respondent, after being credited for fees of twenty-five percent of amounts collected owed the hospital either $1159.12 or $1061.49, depending on how certain out-of-pocket advances by respondent were credited. The commission audit of respondent's trust account reflected *3 that he had retained none of the funds collected for the hospital other than the $556.13 which was transmitted to the hospital on November 10, 1978, and for which credit was given in arriving at the final amount owed. On May 21, 1981, five weeks after the present complaint was filed against the respondent, he remitted the sum of $1061.49 to Schoitz Memorial Hospital.
At the hearing before the Grievance Commission, the respondent testified that the percentage fee arrangement with the hospital had been modified from twenty-five percent to fifty percent by an oral agreement between himself and Mr. Canfield in November of 1978. When pressed for the precise time of such agreement, respondent stated that it occurred between the time of his November 10, 1978, accounting to the hospital reflecting a twenty-five percent fee entitlement and Mr. Canfield's departure from the hospital staff in mid-November of 1978. Mr. Canfield testified at the hearing and denied that the twenty-five percent fee arrangement was modified. In addition, some internal records kept in respondent's law office subsequent to Mr. Canfield's departure from the hospital staff continued to reflect a twenty-five percent fee arrangement on Schoitz Memorial Hospital accounts.
II. Joan Osborn.
Those counts in the complaint involving Joan Osborn flow from the following transactions as shown by the record. Joan Osborn moved to Iowa from the state of Washington in September, 1979, and employed respondent to represent her in a post-dissolution decree dispute with her former husband. This dispute involved in part sums of money in Osborn's possession, which her husband claimed were owed to him under the decree. At the inception of the attorney-client relationship, Joan Osborn paid respondent a $1000 retainer and agreed to an hourly rate of $50 for legal services performed in this representation. During the time that respondent was representing this client, she gave respondent additional funds to place in his trust account. She gave him $6110.25 for this purpose on January 9, 1980, and $2000 on January 12, 1980.
Joan Osborn terminated respondent's representation on May 9, 1980, and asked him to return to her the funds he was holding in his trust account. At this time, respondent informed her that his bill to date for attorney fees and expenses totaled $5931.94 and that said charges had been applied in reduction of the $9110.25 which had been paid to him leaving only $3178.31 to be returned to her. Respondent had not given Joan Osborn an accounting of fees and expenses prior to this time.
During the May 9, 1980, meeting between Joan Osborn and respondent, she disputed his entitlement to the $5931.94 in fees and expenses but acquiesced in taking a check for $3178.31 from respondent's trust account until the matter was resolved. On May 9, 1980, the date this check was written, respondent did not have sufficient funds in his trust account to cover the check. Joan Osborn learned of this when she presented the check for payment at the drawee bank. On May 12, 1980, respondent made a deposit in his trust account sufficient to bring the balance thereof above the amount of the Osborn check. When she presented the check for payment a second time, respondent stopped payment on the check when the bank informed him that Joan Osborn had noted thereon that the check did not constitute full payment of sums owed. It was not until April 15, 1981, one day after the present complaint was filed by the Committee on Professional Ethics and Conduct that respondent made payment to Joan Osborn in the sum of $3178.31.
An audit of respondent's trust account conducted by the Client Security and Disciplinary Commission revealed that based upon respondent's own billing records, a substantial portion of the $5931.94 had been transferred from the trust account as "fees earned" prior to the time the services are shown to have been performed. In addition, the audit reveals that on May 1, 1980, *4 the total balance on deposit in respondent's trust account from all sources was only $238.95, at which time respondent concedes he still owed Joan Osborn at least $3178.31.
At the hearing before the Grievance Commission, Joan Osborn testified that only the initial $1000 paid to respondent was to be applied toward the costs of litigation. She testified that the remaining $8110.25 was placed in respondent's trust account with his knowledge and approval in order to make the facts fit the testimony which she had given in a deposition. She stated that she had testified in the deposition that $8000 in her possession, which her former husband was trying to locate, had been placed in respondent's trust account. She testified that in fact the funds were given to respondent after such testimony had been given. Respondent denied Joan Osborn's version of the transaction in his testimony before the Grievance Commission and stated that the entire $9110.25 was paid to him for purposes of being applied on his attorney fees and out-of-pocket advances.
III. Summary and Disposition.
Without question, the record establishes that respondent breached his professional responsibility as a lawyer by failing to account for clients' funds in his possession, failure to maintain clients' money separate from his own and failure to return clients' funds within a reasonable period of time after being requested to do so. This conduct constitutes serious violations of the Iowa Code of Professional Responsibility for Lawyers, Ethical Consideration 1-5; Disciplinary Rule 1-102(A)(1), (3), (4) and (6); Ethical Consideration 9-5; and Disciplinary Rule 9-102, calling for substantial discipline.
The more serious issue which we must resolve is the claim that respondent converted clients' funds to his own use. Our disciplinary decisions have quite consistently held that such conduct calls for revocation of license rather than suspension. Committee on Professional Ethics and Conduct v. Pappas, 313 N.W.2d 532 (Iowa 1981); Committee on Professional Ethics and Conduct v. Shaffer, 230 N.W.2d 1 (Iowa 1975); Committee on Professional Ethics and Conduct v. Rowe, 225 N.W.2d 103 (Iowa 1975); Committee on Professional Ethics and Conduct v. Bronemann, 210 N.W.2d 607 (Iowa 1973); Committee on Professional Ethics and Conduct v. Sturek, 209 N.W.2d 899 (Iowa 1973).
Our review of the present record is de novo. Committee on Professional Ethics and Conduct v. Rabe, 284 N.W.2d 234, 235 (Iowa 1979); Committee on Professional Ethics and Conduct v. Bitter, 279 N.W.2d 521, 522 (Iowa 1979). Allegations of misconduct must be established by a convincing preponderance of the evidence. Rabe, 284 N.W.2d at 235. Viewing the record before us in this light, we find that it clearly requires a finding that respondent did convert the funds of both Schoitz Memorial Hospital and Joan Osborn to his own use. Respondent's efforts to pass the Schoitz Memorial Hospital incident off as a mere fee dispute is unpersuasive. When pressed by the hospital for an accounting, he made no response. This conduct is inconsistent with his later claim that the hospital owed him money as a result of a change in the fee arrangement. Respondent's claim concerning the change in the fee arrangement did not surface until he was being audited by the Client Security and Disciplinary Commission, a circumstance which he must have realized would establish a shortage of client's funds under the existing percentage fee arrangement with the hospital. We find that respondent's claim that the fee arrangement had been modified was an attempt to conceal the conversion of client funds which had taken place.
In the Joan Osborn transaction, it appeared without dispute that on May 1, 1980, respondent's trust account balance was virtually depleted; yet, even when the evidence is viewed most favorably to him, he was holding at least $3178.31 of client funds. We note in this regard that the record will support a finding that an even larger amount of client funds were entrusted to his possession at this time. Respondent's only explanation for the condition of *5 his trust account on May 1, 1980, was to claim that the missing client money was not converted to his personal use but was applied on cost advances made on behalf of other clients. Respondent offered no documentation of this claim. In any event, application of clients' funds to the use and benefit of third parties is only slightly distinguishable, if at all, from a conversion to the lawyer's own use and benefit. Based upon the established charges of conversion of clients' property and the other violations of professional conduct which we have found to exist, we direct that the license of Larry J. O'Connor to practice law in this state be revoked.
LICENSE REVOKED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399909/ | 529 F.Supp.2d 881 (2007)
CANADIAN THERMAL WINDOWS, INC., and 420820 Ontario Limited Corporation, Plaintiffs,
v.
MAGIC WINDOW COMPANY, Defendant.
No. 07 C 1784.
United States District Court, N.D. Illinois, Eastern Division.
August 27, 2007.
Jerold B. Schnayer, John Aron Carnahan, Welsh & Katz, Ltd., Chicago, IL, for Plaintiffs.
Christina L. Brown, Michael Joseph H. Baniak, McDonnell Boehnen Hulbert & Berghoff LLP, Chicago, IL, Kristin L. Murphy, Mary Margaret L. O'Donnell, Tracy L. Zawaski, Rader, Fishman & Grauer, PLLC, Bloomfield Hills, MI, for Defendant.
MEMORANDUM OPINION AND ORDER
JAMES B. MORAN, Senior District Judge.
A plaintiff sometimes brings an action in a forum where it is unlikely that there is personal jurisdiction, but suit there is convenient for plaintiff or its counsel. Plaintiffs brought suit here, which was not convenient for them, but it was convenient for their Chicago-based intellectual property counsel. Defendant resisted, and plaintiffs eventually moved to transfer the action to the Eastern. District of Michigan.
Usually, in these circumstances the defendant is content to have the action transferred and seeks no other relief. But this is a case where the' mouse roared. Unhappy with having allegedly spent more than $50,000 in fees and costs on the procedural skirmishing before the transfer, defendant seeks recovery of those fees and costs, claiming abuse of the judicial system. See Methode Electronics, Inc., v. Adam Technologies, Inc., 371 F.3d 923, 927-928 (7th Cir.2004). Given the particular circumstances of this case, we agree. In determining reasonable fees and costs, the parties shall follow the dictates of LR 54.3.
In most cases of this nature the plaintiff can at least claim that it knew little, or certainly not enough, about defendant's activities in the designated forum"to rule out litigation there. But here the parties had *882 had an on-again/off-again relationship for almost a decade, and plaintiffs were well aware that defendant was a business localized in southeastern Michigan. Expedited discovery turned up nothing that plaintiffs did not already knownone of which bolstered a personal jurisdiction claim. Defendant has a passive website directed to southeast Michigan. Given the nature of websites, it can be viewed elsewhere, but that is no more basis for suit in Illinois than it is in Hawaii. See Jackson, et al., v. The California Newspapers Partnership, et al., 406 F.Supp.2d 893 (N.D.Ill.2005). Defendant does engage in continuing and systematic business contacts in Illinois, but only in the sense that it buys some supplies heresupplies that are wholly unrelated to this lawsuit. That is not doing business in Illinois any more than a local grocery defendant in a slip-and-fall case is doing business in Idaho because its potatoes come from there. And the inclusion of the company name, with addresses on the papers relating to ,those purchases, is clearly a use as a company name and not as a trademark. See Application of Walker Process Equipment, 43 C.C.P.A. 913, 233 F.2d 329 (1956).
Suit here was doomed from the start. Even if, to plaintiffs' surprise, something turned up that gave at least a colorable claim of jurisdiction in this district, there was nothing to keep it here. Neither of the parties has any contacts in Illinois relating to this lawsuit, and any alleged infringement took place in the Eastern District of Michigan. Therefore, the case would have been transferred there in any event, a conclusion plaintiffs belatedly accepted, but not until defendant had spent a considerable amount of money totally unnecessarily. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399916/ | 455 S.W.2d 177 (1970)
Haskle THURMAN, Plaintiff in Error,
v.
STATE of Tennessee, Defendant in Error.
Court of Criminal Appeals of Tennessee.
March 12, 1970.
Certiorari Denied May 18, 1970.
*178 Jack R. Brown, Chattanooga, for plaintiff in error.
David M. Pack, Atty. Gen., Thomas E. Fox, Deputy Atty. Gen., Nashville, Edward E. Davis, Dist. Atty. Gen., John R. Seymour, Asst. Dist. Atty. Gen., Chattanooga, for defendant in error.
Certiorari Denied by Supreme Court May 18, 1970.
OPINION
HYDER, Judge.
This is an appeal in the nature of a writ of error from a conviction of transporting more than one gallon of unstamped whiskey and a resulting sentence of two years in the penitentiary.
Haskle Thurman was arrested on the morning of October 29, 1968, by two Chattanooga City Detectives and an Agent of the State Alcohol Beverage Control Commission. The detectives approached the defendant when he was in a blue, 1958 Chevrolet automobile, identified themselves, advised him that they had information that he was hauling whiskey, and asked him if he would mind opening the trunk of the car. First, the defendant told them that he did not have a key for the trunk, and Officer Elsea told him: "we can obtain a warrant." According to the testimony of Detective Elsea, the defendant then said, "well, you've got me and reached into the floorboard and got the trunk key and got out of the car and opened the trunk." The trunk contained seventeen gallons of unstamped liquor or whiskey.
Detective Elsea testified, in the absence of the jury, that the night before this arrest he had received the following information:
"His information was that at approximately 7:00 A.M. the next morning that a 1958 blue Chevrolet would be in the two hundred block of Lookout Street. The car would be driven by a white male who usually wore overalls, dressed in overalls, and there would be around ten to thirty gallons of unstamped whiskey in the automobile."
He testified that he had known this informer for approximately two and a half years, that he had received information from him on many occasions, and that the information had always been reliable.
On cross examination counsel for the defendant asked Officer Elsea why he did not obtain a search warrant, and the officer replied: "The informant was not sure on the license number of the car so I couldn't obtain a search warrant." Counsel also inquired if the officer had asked the informer how he knew the whiskey would be in the car, and if he had asked the informer if he had seen whiskey in this car. Officer Elsea stated that he had not asked the informer these questions. He also asked Detective Elsea if he had any information that would have precluded him from stopping any white male driver in a '58 blue Chevrolet; and the officer responded: "No sir."
The officers saw the defendant at six fifty o'clock, A.M., as he drove past them and stopped the car in the two hundred block of Lookout Street, in Chattanooga. The record does not disclose how the defendant was dressed or that he was wearing overalls, nor does the record show that he was a white man.
Counsel for the defendant attempted to obtain the name of the informer, but the trial judge sustained the State's objections to his questions on this subject.
The record discloses that the trial judge had a discussion with Officer Elsea, which is reported as follows:
"THE COURT: In the trunk of this car. Now, Mr. Brown has raised the question of whether or not this information you received wascame from a reliable and dependable person. Now off the record
(Thereupon a discussion was had between the Court and witness out of hearing of court reporter and counsel.)"
*179 And the trial judge ruled:
"Well, let the record show that the Court has questioned the witness to determine in the Court's own mind whether or not this informant was a reliable and dependable person and whether his information came from a reliable and dependable source. Based on Wallace [Wallis] v. State, 417 S.W.2d 781, under a United States Supreme Court decision cited therein this Court is overruling your motions, Mr. Brown."
The first assignment of error contends that the verdict of the jury is contrary to the law and the evidence in the cause. The other five assignments of error complain that the trial court erred in failing to sustain the defendant's motion to suppress the evidence for the reason that the search of the defendant's car, and the arrest of the defendant, violated his legal and constitutional rights. It is also contended that the trial court erred in limiting defendant's counsel in cross examining the officer relating to the underlying circumstances of the informant's reliability and the credibility of the informant's alleged information; and the procedure followed by the trial judge in "going off" the record for the purpose of determining reliability of the informant and the credibility of the information is assigned as error. It is contended that the trial judge thus deprived the defendant of his right to cross examination and confrontation by this off the record procedure.
The State insists in its brief that the search of the car was reasonable and the evidence seized was admissible. The State bases this position on the theory that the information received by the officer was sufficient to justify the search.
We do not believe that it is necessary to consider the question of the sufficiency of the information received by the officer to establish the probable cause required in our law to authorize the search of the car without a warrant, because we find that the record is clear that the defendant, without coercion, permitted the officers to see in the trunk of the car with out a warrant. He admitted to them that "well, you've got me."
In Frix v. State, 148 Tenn. 478, 256 S.W. 449, three officers went to the defendant's home, and, before making their presence known, saw through an open door of an outhouse at the rear of the residence some barrels of "beer." The officers then knocked and when the defendant appeared they placed him under arrest. It was then shown, without contradiction, that one officer asked the defendant whether they would be required to go back to town and obtain a search warrant in order to search his premises, or whether he would be willing for them to search his premises without such a warrant. To this inquiry the defendant Frix replied: "Mr. Brown, you are welcome to go anywhere on my place you want to and search. Go to it." In sustaining the conviction of the defendant for unlawfully manufacturing whiskey, or attempting to manufacture whiskey, and in sustaining the search as having been done with the consent of the defendant, our Supreme Court said:
"Here, instead of announcing their intention to search whether permission was given or not, the officers informed defendant that unless permission was given they would be compelled to go back to town and procure a search warrant. There was no coercion about the defendant's subsequent agreement and consent that the search be made without a warrant. He therefore waived his right to require that the officers obtain a search warrant before searching his premises."
Our Supreme Court has rule consistently that a defendant may waive his rights relative to searches and seizures under the Constitutions of Tennessee and the United States; and that for such a search without a warrant to be valid the entry must be without coercion. Byrd v. State, 161 Tenn. 306, 30 S.W.2d 273; Simmons v. State, *180 210 Tenn. 443, 360 S.W.2d 10; Shafer v. State, 214 Tenn. 416, 381 S.W.2d 254; Fox v. State, 214 Tenn. 694, 383 S.W.2d 25; Deerfield v. State, 220 Tenn. 546, 420 S.W. 2d 649.
The decisions of the United States Courts are in accord. In an opinion in the United States District Court for the Middle District of Tennessee, Simmons v. Bomar, 230 F.Supp. 226, at 229, we find:
"There is no question that one's constitutional right to demand a search warrant can be waived or that one can consent to a search without a warrant. United States v. Jones, 204 F.2d 745 (7th Cir. 1953), cert. denied, 346 U.S. 854, 74 S.Ct. 67, 98 L.Ed. 368. However, this is not presumed, and the burden is upon the state to show that a competent and voluntary waiver has been made. Mere acquiescence or consent in the face of an announced or apparent intention to search with or without a warrant or permission does not constitute a waiver. See Amos v. United States, 255 U.S. 313, 41 S.Ct. 266, 65 L.Ed. 654 (1921); Catalanotte v. United States, 208 F.2d 264 (6th Cir. 1953); Judd v. United States, 89 U.S.App.D.C. 64, 190 F.2d 649 (1951); United States v. Evans, supra [194 F.Supp. 90, D.C.]
"However, where, as here, the consent is given in response to an announced intention to leave and secure a warrant if permission is not given, the waiver is competent and voluntary. Gatterdam, et al., v. United States, 5 F.2d 673 (6th Cir. 1925); United States v. Page, 302 F.2d 81 (9th Cir. 1962); Grice v. United States, 146 F.2d 849 (4th Cir. 1945); United States v. Haas, 106 F.Supp. 295 (W.D.Pa.1952); Frix v. State, 148 Tenn. 478, 256 S.W. 449 (1923)."
This proposition is well stated in 79 C.J.S. Searches and Seizures § 62(b), page 820, where we find:
"In order to constitute a waiver it must be clearly shown that consent given to an otherwise illegal search was voluntary, that is, that it was free from coercion, duress, or fraud, and not given merely to avoid resistance. Voluntary consent requires sufficient intelligence to appreciate the act as well as the consequence of the act agreed to. Since the constitutional guaranty is not dependent on any affirmative act of the citizen, the courts do not place the citizen in the position of either contesting an officer's authority by force or waiving his constitutional rights, but instead they hold that a peaceful submission to a search or seizure is not a consent or an invitation, thereto, but is merely a demonstration of regard for the supremacy of the law. It is not a waiver of objection to the illegal search, or a waiver of a valid warrant, or a waiver of the constitutional guaranty. However, a submission to search in response to a threat of the officers that they will procure a search warrant does not make it any the less voluntary, and the mere fact that a search and seizure is made at the instance of an officer or that accused knew the searcher to be an officer does not establish that the consent was involuntary. The party alleging the waiver must establish that the waiver was a free and voluntary act."
The only proof in the instant case on the subject of whether or not the defendant, without coercion, duress, or fraud, voluntarily waived his rights relative to searches and seizures under the Constitutions of the United States and Tennessee, was the testimony of Detective Officer Elsea. He testified:
"I walked up to the defendant's car, advised him who I was, I was a police officer, that we had information that he was hauling whiskey and asked him if he would mind opening the trunk of his car. He said I don't have a key to the trunk and I said, well, we can obtain a warrant. He said, well, you've got me and reached into the floorboard and got *181 the trunk key and got out of the car and opened the trunk."
This testimony was in no way disputed, even though a lengthy hearing was held in the absence of the jury and the defendant had opportunity to testify on that limited question. Certainly the State, having the burden of establishing that the waiver was free and voluntary, has borne that burden in the light of the cases we have cited. We find that the facts justifying our conclusion that the waiver was free and voluntary are even stronger than those established in Frix v. State, supra, because here we have more than the statement of the defendant consenting to the search; here, the defendant actually opened the trunk for the officers.
The State, in its reply brief, relies upon the recent opinion of the Tennessee Supreme Court in State v. William A. Tolden, 451 S.W.2d 432, filed December 15, 1969, which will be published. We concede that the facts in that case are quite similar to the facts in the instant case, but there the record does not show that the defendant consented to the search. The holding of our Supreme Court in Tolden would, of itself, perhaps support the conviction in this case, but there are some differences in the circumstances in the two cases.
In view of our holding that this search and seizure was with the consent of the defendant it follows that the evidence seized was admissible in the trial. There being no other evidence in the case it follows that the jury was certainly justified in their verdict of guilty. The defendant has not borne the burden which is his of showing that the evidence preponderates against the verdict of guilty and in favor of his innocence. McBee v. State, 213 Tenn. 15, 372 S.W.2d 173; Brown v. State, Tenn. Crim.App., 441 S.W.2d 485
The unstamped whiskey or liquor seized from the defendant's car was poured out, except one pint which was retained and admitted into evidence at the trial. It can not be contended successfully that, under the best evidence rule, it was incumbent upon the State to produce the liquor itself in court, though quite an argument was made during the trial on this point. Whiskey of the kind seized by the officers is a familiar article and its identity can be determined by sight, aided either by the sense of smell or by the sense of taste. The best evidence rule is not applicable to things of this nature and the production of such things in court is not required. Williams v. State, 179 Tenn. 247, 165 S.W. 2d 377.
The assignments of error contending that the trial court erred in failing to sustain defendant's motion to suppress the evidence, that the trial court erred in limiting defendant's counsel cross examining the officer relating to the informer and the credibility of the alleged information, and the assertion that the trial judge erred in "going off" the record for the purpose of determining reliability of the informant are all overruled. None of these contentions have any merit in view of our holding that the search and seizure were with the consent of the defendant.
The defendant was convicted of transporting more than one gallon of intoxicating liquors, and his maximum punishment was fixed by the jury at two years in the penitentiary. In imposing sentence the trial judge ordered that the defendant be confined in the penitentiary for a term of not less than two years nor more than two years. This was error, as is pointed out in the State's reply brief. The minimum sentence for this offense is one year and one day in the penitentiary. T.C.A. § 39-2509. Accordingly, we modify the judgment in this case to be a term of one year and one day to two years in the penitentiary and the costs. Leek v. State, 216 Tenn. 337, 392 S.W.2d 456.
As modified, we affirm the judgment of the trial court.
WALKER, P.J., and DWYER, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399919/ | 455 S.W.2d 670 (1970)
Clyde Ray GLOVER, Appellant,
v.
The STATE of Arkansas, Appellee.
No. 5479.
Supreme Court of Arkansas.
June 29, 1970.
*671 W. B. Howard, and Jack Segars, Jonesboro, for appellant.
Joe Purcell, Atty. Gen., Mike Wilson, Asst. Atty. Gen., Little Rock, for appellee.
*672 BYRD, Justice.
Appellant Clyde Ray Glover was found guilty of murder in the first degree and sentenced to death for the alleged killing of Judy Evans. The gruesome facts, as related by an accomplice and as told by appellant to his own sixteen year old son, will not be reiterated because the evidence is clearly sufficient to sustain the verdict. In fact the sufficiency of the evidence is recognized in appellant's brief as follows:
"The evidence of the state, if believed by the trier of fact, was abundantly ample to support his conviction and sentence to death by electrocution. In the prosecution of this appeal, it will not be our purpose to persuade the court that the evidence was not sufficient to sustain a conviction. As a matter of fact, the evidence of the State, if believed, reveals one of the more gruesome murders and subsequent attempt to conceal murder recorded in the annals of this State. There was and is a serious question about the credibility of each and every material witness for the State. The defendant's defense was predicated upon an alibi and upon the lack of credibility of all material witnesses called against him."
For reversal appellant relies upon the following points:
I. "The court erred in refusing to quash the search warrant issued on March 5, 1969, and in refusing to exclude evidence obtained pursuant to such search warrant.
II. The court erred in overruling appellant's challenges for cause to talesmen Ralph Shoe, Glenn T. Boyd, Wayne L. Britewell and Alvin Jackson White.
III. The court erred in refusing to allow the defendant to prove on cross-examination of the state witness Peggy Pitcher that said witness had been told that the defendant and her husband had been double-dating.
IV. The court erred in commenting on the weight of the evidence by stating in effect in the presence of the jury that there was no testimony justifying the inference that witness Leorn Pitcher had assaulted the decedent with an intent to kill her.
V. The court erred in allowing the accomplice Latham to testify that after the crime he showed the officers the place where a ring, allegedly taken from the finger of the decedent, was buried and that the officers recovered the ring at the place pointed out by the witness.
VI. The court erred in allowing Deputy Prosecuting Attorney Howard Mayes to comment on defendant's failure to take the witness stand.
VII. The court erred in refusing to give defendant's requested Instruction No. 1."
Because we are reversing the judgment for failure of the trial court to excuse from the jury talesmen Ralph Shoe, Glenn T. Boyd, Wayne L. Britewell and Alvin Jackson White we do not discuss Points IV and VI. They are not likely to arise on a new trial.
POINT II
The record, with respect to talesmen Shoe, Boyd, Britewell and Jackson, is as follows:
Juror Ralph Shoe when interrogated by the court stated:
"I just formed my own opinion. A witness could come on the stand and change everything. I formed an opinion from what I read about it and heard talked about it. As I say, a witness could change it all around. I would disregard whatever opinions I have formed in the past and base my verdict simply and strictly on the evidence given and the law given without regard to any opinions *673 which I may have previously held. I did not talk to any body who purported to be a witness."
When interrogated by defendant's counsel the juror stated:
"My present mental state is that I would attempt to follow what the court says about the evidence and the law and consider only the evidence heard from the witness stand and the law given me by the court. But, in that connection, until I hear evidence from the witness stand that gives me grounds to believe something which would cause me to change my ideas, I would still have those ideas. * * *"
Juror Glenn T. Boyd when questioned by the court said that he had formed an opinion and that he realized whatever he read in the paper was hearsay and if selected as a juror he would disregard it and try the appellant on the evidence he heard in court. But when interrogated by defendant's counsel, he said:
"I formed some tentative opinions about the matter which I presently entertain. While I indicated to His Honor that I would be willing to set this opinion aside and try the case on the law and the evidence, until some evidence is introduced to remove that opinion, I will still have it."
Juror Wayne L. Britewell testified as follows:
Interrogation by court:
"I recall reading about the death of the decedent. It is a little hard not to form an opinion. Regardless of the opinions I have formed and regardless of whether what I may have read or heard is true, I would try it on the evidence I hear in court to the best of my ability. I would set these opinions aside.
Interrogation by appellant's counsel:
"In answering Judge Light, I stated that what I had read and heard was the only evidence I had, that I believe that I was supposed to go by the evidence. Until such time as I did hear evidence in this case, I would entertain my present opinion.
Interrogation by court:
"The opinions I have formed were arrived at either from hearing about it from other people who did not purport to be witnesses or from what I read in the paper. This is an opinion which I could readily disregard. I would readily disregard such an opinion and base my verdict wholly and solely on the evidence in the case.
Interrogation by counsel:
"It would take some evidence to remove my present opinion."
Juror Alvin Jackson White after interrogation by the court finally stated to appellant's counsel:
"Although I have indicated an answer to his Honor's questions that I am perfectly willing to set aside my present opinions to the best of my ability and try the case on the law and the evidence, it would take evidence to remove that opinion and I would keep that opinion until I heard evidence to the contrary."
Both the U. S. Constitution, Amendment No. 6, and the Arkansas Constitution, Art. 2, § 10, guarantee the accused in all criminal prosecutions trial "by impartial jury". In a case involving a sensational killing and newspaper publicity it is almost impossible to find an informed citizen to serve on the jury who has not heard about the case and who has not formed some opinion based upon the newspaper accounts. In such cases it is the duty of the trial court to determine whether an opinion has been formed and whether the jurors can lay aside such opinion and give to the accused the benefit of all doubts that the law requires while trying him on the law and the evidence given to them during the trial. When a venireman states *674 that he can lay aside such preconceived opinions and give to the accused the benefit of the doubts to which he is entitled under law, it is generally conceded that the venireman qualifies as "impartial" under the constitutional requirements. See Rowe v. State, 224 Ark. 671, 275 S.W.2d 887 (1955), where we said:
"While it is true that some of the veniremen said that they had formed tentative opinions based upon newspaper reports or what someone had told them, all who were accepted stated that they could and would be guided solely by the testimony, giving to the defendant the benefit of all doubts that the law defines. There was no error in accepting these men. It is no longer practicable in an intelligent society to select jurors from a psychological vacuum or from a stratum where information common to the community as a whole is lacking."
In Irvin v. Dowd, 366 U.S. 717, 81 S.Ct. 1639, 6 L.Ed.2d 751 (1961), the U.S. Supreme Court, speaking through Mr. Justice Tom Clark, discussed the "impartial" juror requirement in this language:
"* * * In essence, the right to jury trial guarantees to the criminally accused a fair trial by a panel of impartial, `indifferent' jurors. The failure to accord an accused a fair hearing violates even the minimal standards of due process. Re Oliver, 333 U.S. 257, 68 S.Ct. 499, 92 L.Ed. 682; Tumey v. Ohio, 273 U.S. 510, 47 S.Ct. 437, 71 L.Ed. 749, 50 A.L.R. 1243. `A fair trial in a fair tribunal is a basic requirement of due process.' Re Murchison, 349 U.S. 133, 136, 75 S.Ct. 623, 99 L.Ed. 942, 946. In the ultimate analysis, only the jury can strip a man of his liberty or his life. In the language of Lord Coke, a juror must be as `indifferent as he stands unsworne.' Co.Litt. 155b. His verdict must be based upon the evidence developed at the trial. Cf. Thompson v. Louisville, 362 U.S. 199, 80 S.Ct. 624, 4 L.Ed.2d 654. This is true, regardless of the heinousness of the crime charged, the apparent guilt of the offender or the station in life which he occupies. It was so written into our law as early as 1807 by Chief Justice Marshall in 1 Burr's Trial 416 (1807). `The theory of the law is that a juror who has formed an opinion cannot be impartial.' Reynolds v. United States, 98 U.S. 145, 155, 25 L.Ed. 244, 246.
It is not required, however, that the jurors be totally ignorant of the facts and issues involved. In these days of swift, widespread and diverse methods of communication, an important case can be expected to arouse the interest of the public in the vicinity, and scarcely any of those best qualified to serve as jurors will not have formed some impression or opinion as to the merits of the case. This is particularly true in criminal cases. To hold that the mere existence of any preconceived notion as to the guilt or innocence of an accused, without more, is sufficient to rebut the presumption of a prospective juror's impartiality would be to establish an impossible standard. It is sufficient if the juror can lay aside his impression or opinion and render a verdict based on the evidence presented in court. Spies v. Illinois, 123 U.S. 131, 8 S.Ct. 21, 22, 31 L.Ed. 80; Holt v. United States, 218 U.S. 245, 31 S.Ct. 2, 54 L. Ed. 1021, 20 Ann.Cas. 1138; Reynolds v. United States (U.S.) supra.
The adoption of such a rule, however, `cannot foreclose inquiry as to whether, in a given case, the application of that rule works a deprivation of the prisoner's life or liberty without due process of law.' Lisenba v. California, 314 U.S. 219, 236, 62 S.Ct. 280, 86 L.Ed. 166, 180. As stated in Reynolds, the test is `whether the nature and strength of the opinion formed are such as in law necessarily * * * raise the presumption of partiality. The question thus presented is one of mixed law and fact. * * *' At p. 156 of 98 U.S. `The affirmative of the issue is upon the challenger. Unless he shows the actual existence of such an opinion in the mind of the juror as *675 will raise the presumption of partiality, the juror need not necessarily be set aside. * * * If a positive and decided opinion had been formed, he would have been incompetent even though it had not been expressed.' At p. 157 of 98 U.S. As was stated in Brown v. Allen, 344 U.S. 443, 507, 73 S.Ct. 397, 97 L.Ed. 469, 515, the `so-called mixed questions or the application of constitutional principles to the facts as found leave the duty of adjudication with the federal judge.' It was, therefore, the duty of the Court of Appeals to independently evaluate the voir dire testimony of the impaneled jurors."
Thus it appears to us that talesmen Shoe, Boyd, Britewell and White, in stating, that they would keep their opinion formed from reading the newspaper until they heard evidence to the contrary, did not qualify as "impartial" jurors within the meaning of either the U.S. Constitution or the Constitution of Arkansas. It follows that the trial court erred in not discharging the four talesmen for cause.
The error is clearly before us because the appellant used four of his peremptory challenges on the four talesmen involved and after all of his peremptory challenges were exhausted, he caused the record to show that if he had not been required to so exhaust his challenges on these four talesmen, he would have peremptorily challenged talesman Burns who sat on the jury.
POINT I
In examining the points raised by the appellant, we find no error in the trial court's refusal to quash the search warrant and exclude the evidence obtained thereby. Both the appellant and the state rely on our decision in Walton and Fuller v. State, 245 Ark. 84, 431 S.W.2d 462 (1968), for their respective positions on this point. In Walton we said:
"* * * While an affidavit for a search warrant may be based upon personal observations of the affiant, it may also be based, in whole or in part, on hearsay information. When it is based upon hearsay, the magistrate must be informed of some of the underlying circumstances from which an informant concluded that the object of a proposed search was where he said it was. He must also be advised of some of the circumstances from which the officer concludes that the informer (whose identity need not be then disclosed) is credible or his information reliable. An affidavit, which does not contain any affirmative allegation that affiant speaks with personal knowledge of the matters contained therein and also fails to show that information given by an unidentified source was not merely his suspicion, belief or conclusion, has been held not to show probable cause."
It will be noted that while an affidavit for a search warrant may be based upon personal observation of the affiant, it may also be based on hearsay information. When the affidavit is based upon hearsay, the magistrate must be informed of some of the underlying circumstances from which an informant concluded that the object of the proposed search was where he said it was. The rule, as we announced it in Walton, is simply designed to eliminate issuance of search warrants on mere suspicion expressed to the issuing magistrate by affiants based on hearsay. The affiants must give the magistrate the benefit of their personal observation when the warrant is sought on that basis, and the affiant must pass on to the magistrate the facts and circumstances the affiant obtained on hearsay information, when the warrant is sought on that basis. The rule as set out in Walton, goes no further than good common sense directs in the interest of justice and fair play. Neither this court nor any other court, insofar as we have been able to determine, has held that an affiant must prove beyond a reasonable doubt the truth of the contents of his affidavit for a search warrant *676 before a valid search warrant may be issued by the magistrate.
The object of the search in the case at bar was a revolving red light and the affidavit states that the officers had reasonable grounds for believing that "a revolving red light, DC current, was owned by Ray Glover and that said revolving red light is now located upon the property and premises of the said Ray Glover on Highway 1 North of Paragould, in Greene County, Arkansas; and that said revolving red light was used upon the highway in this county on or about March 1, 1969, to stop a vehicle driven by one Judy Evans; and the affiants have reasonable grounds for believing said Judy Evans was killed and murdered on that date by Ray Glover together with other person or persons." Now, concerning the information furnished by the officers in their affidavit as to the underlying circumstances from which their informant concluded that the red light was where he said it was; and as to the advice of some of the circumstances from which the officers concluded that the informer was credible or his information reliable, the officers state in their affidavit as follows:
"That affiants have been so informed by an informant known to these affiants, the informant stating that he was present with Ray Glover at the time the revolving red light was placed in a building upon the aforementioned property of Ray Glover.
That the informant is known to the affiants and that previous information supplied by said informant has proven reliable and accurate and that the affiants have reason to believe that the information herein is also reliable and dependable.
That on another occasion informant gave information that a certain ring was worn upon the person of the said Judy Evans at the time of her death; that the ring was removed by Ray Glover and in the presence of the informant buried at a certain location supplied to affiants and other investigating officers; that upon a search of the location given by the informant said ring was in fact found.
That on other occasions this informant has supplied information concerning theft of automobiles by person or persons when in fact said automobiles had been reported stolen.
That affiants further state that the said Ray Glover was at all times mentioned herein wearing a leather jacket, shirt, trousers, shoes, at the time of the killing of the said Judy Evans and upon informant's information said clothing is believed to be located upon the premises herein described; that said clothing is believed to contain evidence of the killing."
We simply hold that the affidavit in the case at bar furnished the magistrate all that it was necessary for him to know, and the court did not err in refusing to quash the search warrant or exclude the evidence obtained thereunder.
POINT III
As to appellant's third point, the State's witness, Peggy Pitcher, admitted that she was involved in civil litigation with the appellant and she readily admitted that she disliked him. Mrs. Pitcher and her husband had purchased a house trailer from appellant which he repossessed with its contents, which Mrs. Pitcher says was purchased from other parties and belonged to her. Mrs. Pitcher's dislike for the appellant and not the reason for her dislike, might have been such cause that would affect her credibility as a witness. Perkins v. State, 168 Ark. 710, 271 S.W. 326 (1925). Mrs. Pitcher had already admitted her dislike for appellant and we find no error in the court's refusal to permit appellant to cross-examine Peggy Pitcher concerning what she had been told about double-dating by her husband and appellant. The offer of proof on this point indicates an obvious effort to prove Peggy Pitcher's bias *677 against appellant. Under offer of proof, Mrs. Pitcher denied that she knew anything about her husband and appellant double-dating with one Alice Cannon and the decedent Judy Evans. We hold that the trial court was in the proper exercise of its discretion in limiting the scope of cross-examination of Peggy Pitcher as to what had been told her about double-dating.
POINT V
We find no merit in appellant's fifth point. There was no objection to Latham's testimony that he was present when the appellant drew a ring off decedent's finger and when appellant subsequently wrapped the ring in masking tape and buried it at the end of a bridge near Corning. Appellant concedes that a picture of Latham, offered in evidence and depicting him showing C.I.D. men where the ring was buried, was not objectionable because its reception would have been harmless, absent the testimony to which the appellant does object. Latham's testimony to which appellant objects appears as follows:
"Q. Where did Ray Glover wrap the ring up in that?
A. At his body shop.
Q. What did he do with the little package?
A. Put it in his pocket.
Q. Did you ever see it again after that?
A. I don't recall seeing it again.
Q. Did you see what Ray did with it? A. I saw him bury it at the bridge up this side of Corning.
Q. I show you here a picture, ask you to examine it?
A. Picture taken of me up at the bridge this side of Corning where I was showing the C.I.D. men where the ring was buried.
Q. Was the ring recovered there?
A. Yes. It was.
Mr. Pearson: Offer it in evidence.
Mr. Howard: I object. Extrajudicial statements made by one of the conspirators after confirmation of the conspiracy, improper.
THE COURT: Objection overruled.
Mr. Howard: Exception.
I further object on the ground of hearsay. And the defendant has the right to face the accuser, and, according to the testimony here, done outside the presence of the defendant.
THE COURT: Objection overruled.
Mr. Howard: Exception."
We do not follow appellant's reasoning in connection with his objection to this testimony, as we do not consider the testimony of Latham as constituting "acts and declarations after the termination of the conspiracy." Latham simply testified as to what he himself saw and did.
POINT VII
In appellant's seventh and last point, we find no error in the trial court's refusal to give appellant's requested Instruction No. 1, which was:
"In determining the truth on any issue involved in this case, mere numbers of witnesses should not be the sole criteria of your determination. Rather, you should consider the credibility or lack of credibility of the respective witnesses and the number of witnesses called to establish an alleged fact should be considered by you solely and alone in the light of probability or improbability as to the alleged fact to which the witnesses may have testified."
*678 Its content was sufficiently covered by other instructions, especially Instruction No. 14, as follows:
"You are the sole judges of the evidence in the case and of the weight thereof, and of the credibility of the witnesses, and in arriving at a conclusion as to what weight you shall attach to the evidence of any particular witness, you will take into consideration his or her interest in the result of the case, his or her conduct, demeanor and manner while testifying as a witness upon the stand, his or her means of ascertaining the knowing the truth of the facts concerning which he or she testified. If you find that a witness has sworn falsely as to any material point is issue, you may entirely disregard the testimony of such witness only if you believe all of his or her testimony to be false, or you may give regard to that part which you believe to be true and disregard that part which you may believe to be false. You have no right to disregard any statement you believe to be true simply because he or she may have sworn falsely as to some other fact."
For the reasons stated in Point II, this matter is reversed and remanded.
FOGLEMAN, J., not participating.
HARRIS, C. J., and JONES, J., dissenting.
JONES, Justice (dissenting).
I am unable to agree with the results reached by the majority in this case and I respectfully dissent for two reasons. In the first place, I find nothing in the record before us nor in the decision of the United States Supreme Court in Irvin v. Dowd, 366 U.S. 717, 81 S.Ct. 1639, 6 L.Ed.2d 751, cited and relied on by the majority, which should make the case at bar immune to the rules this court followed long before the United States Supreme Court ever heard of the Indiana case of Irvin v. Dowd.
In the second place, the appellant was not tried by any juror he challenged for cause. In effect, the appellant contends that had he not wasted four of his peremptory challenges on prospective jurors who should have been excused under his challenges for cause he would have exercised a peremptory challenge on a Mr. Burns who sat on the jury but who was not challenged by the appellant for cause.
Judy Evans was twenty years of age when the charred remains of her still smouldering body were discovered on the floor of her parents' 1966 Pontiac automobile which was found burning in a gravel pit off a county road in Greene County, Arkansas. Automobile tire and human footprints, together with the position of the automobile and other evidence surrounding the scene, even prior to autopsy, made it perfectly clear that Judy did not die as a result of her own negligence in the operation of her automobile, as someone had obviously attempted to make it appear. The physical evidence, even prior to the multiple skull fractures revealed on autopsy, pointed unmistakably to a stupid and thinly veiled effort to submerge the crime of murder in a crime of arson, and to destroy all evidence of the former by cremation aided by an ample supply of gasoline generously applied. James Allen Latham and Clyde Ray Glover were soon apprehended and charged with the crime of murdering Judy Evans.
From the record before us the above facts are all that any prospective juror knew, or could have known, prior to the trial of this case. At the trial, Latham admitted his part in the murder and explained in gruesome detail how Glover felt that Judy knew too much about automobile thefts, as well as house burglaries and arson in which Glover and others, including the witness, were involved. Latham explained in detail how he and Glover used a revolving red light to apprehend and stop Judy on the highway; how Glover drove Judy's automobile to a little used road while he followed in the automobile he and *679 Glover were using; how Glover started "pecking" at Judy in her automobile and how Judy ran to the automobile occupied by Latham and sought his protection against Glover, whom she erroneously thought to be drunk. Latham then gave a blow by blow description of how Glover beat Judy unconscious with his fist and how when she revived, he beat her head with an automobile bumper jack until they thought she was dead; how then, when they noticed that her heart was still beating, Glover pulled her head over by her hair and beat her head some more with the bumper jack, remarking at the time that it didn't bother him a bit. Latham explained how he, at Glover's request, went for the four gallons of gasoline he had purchased several days before for the purpose of cleaning an automobile part. Latham explained how they placed Judy's body upright in the automobile with her foot on the accelerator; how they then accelerated the automobile into the gravel pit; how they saturated the automobile and Judy's body with gasoline and how Glover ignited the gasoline. He related in minute detail how he and Glover disposed of the loot from Judy's purse. They divided the small change and he chewed the chewing gum. Latham testified as to how he helped Glover clean the blood from Glover's black leather coat. He described how Glover prepared and buried a ring he took from Judy's finger before they set her body on fire, and how he led the officers to the ring where he had seen Glover bury it. Latham attempts to explain his own participation in this crime by asserting his physical fear of Glover, but he denies that his testimony was prompted to any degree at all by his fear of the electric chair. Latham's testimony was fully corroborated by circumstantial evidence and the testimony of other witnesses, including that of Randy Ray Glover, the appellant's own sixteen year old son, who testified that on the day following the ghastly night's work related by Latham, his father casually remarked that they had killed Judy Evans and had missed some money because she had not cashed her pay check. Such was the nature of the crime committed, and such was the nature of the testimony offered by the state.
The appellant heard all of the testimony offered against him by the state in grisly detail and he failed to deny that he said and did everything the state's witnesses testified that he said and did. The burden was on the state to prove that Glover was guilty as charged and, of course, Glover was well within his rights in not testifying in his own defense. In failing to testify, or offer any other evidence to contradict the testimony of the state's witnesses however, the appellant leaves the state's evidence uncontradicted and unimpeached except as to such lack of credibility that may attend the casual commission of such a ghoulish crime by individuals who claim all the rights and privileges of civilized men; and such lack of credibility that may attend the testimony of an admitted thief and accessory to such crime.
Unlike the case of Irvin v. Dowd, supra, relied on by the majority, there is no evidence that any of the jurors, or any of the prospective jurors, heard anything at all about the details of Judy's murder until they heard it from the witnesses at the trial of the case. In so far as the record reveals, all they knew or could have known, was that Judy had been murdered and her body burned in her automobile; but the record does not reveal that they even knew she had been murdered. Unlike Irvin v. Dowd, the record is silent in the case at bar as to what was published in the newspapers from which the jurors could have formed opinions.
I fully agree with Glover and the majority of this court that Glover was entitled to a fair and impartial trial, but I do not agree with Glover and the majority of this court that Glover did not receive a fair and impartial trial. Glover contends, and the majority agrees, that the trial court erred in overruling appellant's challenges for cause to the talesmen Ralph Shoe, Lynn T. Boyd, Wayne L. Britewell, and Alvin Jackson *680 White. Each of these gentlemen stated on voir dire that they had formed opinions as to the guilt or innocence of the appellant by reading newspapers and hearing the case discussed by people in general, none of whom were witnesses or purported to actually know anything about the case. The news articles and the substance of general discussion are not in the record, but under questioning by the court these gentlemen stated that they could and would lay aside the opinions they had formed and render their verdict according to the law as instructed by the court and the evidence as presented at the trial. Under examination by appellant's counsel, these prospective jurors stated that it would take some evidence to change the opinion they had formed. They were not asked, nor did they state, what their opinions were; neither did they sit on the jury before whom the appellant was tried. These jurors were summarily discharged by the appellant through the exercise of his peremptory challenges.
The appellant's actual contention, therefore, is that the trial court committed prejudicial error by causing him to waste four of his twelve peremptory challenges on talesmen who should have been discharged for cause. This contention is ingeniously conceived and expertly presented; it has apparently impressed the majority of this court. The majority points out that the appellant caused the record to show that if he had not been required to exhaust his peremptory challenges on the four talesmen, he would have peremptorily challenged talesman Burns who did sit on the jury. It appears to me that if the appellant had been as concerned with the qualifications of juror Burns, as he now appears, he would have at least challenged Burns for cause, if he felt that Burns was not qualified, instead of asking for additional peremptory challenges which the law does not, and the court can not, give.
In Rowe v. State, 224 Ark. 671, 275 S.W. 2d 887, the first eight assignments of error related to the court's action in permitting jurors to serve when, from the defendant's point of view, the answers given on their voir dire disclosed prejudice, fixed opinion as to the defendant's guilt, or were in some position or relationship calculated to influence jury action irrespective of the evidence. In passing on the "fixed opinion" assignment in that case, this court said:
"While it is true that some of the veniremen said that they had formed tentative opinions based upon newspaper reports or what some one had told them, all who were accepted stated that they could and would be guided solely by the testimony, giving to the defendant the benefit of all doubts that the law defines. There was no error in accepting these men. It is no longer practicable in an intelligent society to select jurors from a psychological vacuum or from a stratum where information common to the community as a whole is lacking."
In Leggett v. State, 227 Ark. 393, 299 S.W.2d 59, the crime, as in the case at bar, was a sensational one. The assignment of error relating to the selection of the jury was so near on all fours with the case at bar, I feel justified in quoting fully from our opinion in that case on the point involved, as follows:
"It is apparent from the record that news about the crime and its investigation had been extensively reported in the press and by radio and television. Many veniremen who had formed opinions on the basis of such reports were excused by the court, but the appellant insists that four jurors whom he challenged for cause should also have been rejected. Each of these four men stated in substance that he had formed an opinion about the case and that evidence would be required to remove his opinion, but upon further questioning each man also declared he could lay aside his preconceived view and try the case impartially upon the law and the evidence.
It is settled by many decisions that a tentative opinion of this kind, based upon *681 newspaper reports and the like, does not disqualify a prospective juror. The appellant relies chiefly upon the early case of Polk v. State, 45 Ark. 165, but that decision was disapproved in Hardin v. State, 66 Ark. 53, 48 S.W. 904, and has not been followed in any later case. Sneed v. State, 143 Ark. 178, 219 S.W. 1019; Howell v. State, 220 Ark. 278, 247 S.W.2d 952."
In the case of Howell v. State, 220 Ark. 278, 247 S.W.2d 952, error was assigned in the court's refusal to dismiss on voir dire examination one L. L. Mack as one of the jurors, and particularly in view of the fact that all peremptory challenges were exhausted by appellant before the full jury was finally selected. Mr. Mack was asked and answered questions in that case as follows:
"`Q. Mr. Mack, do you have such an opinion on your mind at this time as would take evidence to overcome it?
A. Yes, sir, I don't know if the State supports what I have read of the thing, I have that opinion if that is true now. I am open minded on what the newspaper reported, but I have formed an opinion from that.
Q. Could you, and would you go into the trial of this matter with an open mind and discharge any preconceived notion or opinion and render your verdict on the facts and circumstances developed in evidence, applying the law given by the court, could you render a verdict and disregard any idea you might have?
A. I think I could.
Q. Would you say you know you could?
A. Yes, if the evidence warrants it.' Counsel for appellant then asked:
`Q. Are you telling this court that you at the present time have an opinion on your mind?
A. Based on newspaper reports.
Q. And that opinion would take evidence on the part of the defendant to remove it from your mind?
A. I wouldn't say that. I would say if the State presents evidence as outlined by the press and other things, it would take some other evidence to disprove that, I don't know what the State is going to show.'
The Court then asked:
`Q. In other words, it would be what the State develops the evidence?
A. Yes, sir.
Q. You could go into the jury box with a free and open mind?
A. I don't see how I could keep from forming an opinion if the facts are as reported by the press.
Q. But still you are open to discharge that from your mind and render a verdict as the State presents its case, also taking into consideration all the evidence which would include the defense, you could do that?
A. Yes, sir.'"
In that case this court said:
"It was not error for the court to refuse to dismiss the juror for cause under the many decisions of this court, such as: Dolan v. State, 40 Ark. 454; Daughtry v. State, 80 Ark. 13, 96 S.W. 748; Dewein v. State, 114 Ark. 472, 170 S.W. 582; and Borland v. State, 158 Ark. 37, 249 S.W. 591."
Presumptions may attend the source of information from which a juror may form an opinion as was clearly set out in the case of Rush v. State, 238 Ark. 149, 379 S.W.2d 29. In that case Fred Rush was being tried for the murder of his stepfather, Paul Rush, who owned and operated a furniture company in Fort Smith. On voir dire examination one of the veniremen stated that he rented a building to the furniture company and had discussed the case with *682 an employee of the company who was also listed as a witness in the case, and that he (the venireman) had an opinion which would take evidence to remove. He also stated that he could set aside his opinion and try the case on the law and on the evidence introduced at the trial. The defendant challenged the qualification of the venireman but the trial court held that he was qualified. In holding that the trial court erred, this court distinguished between opinions formed by reading newspaper accounts and hearing the case discussed generally, and opinions formed as a result of discussing the case with a prospective witness, in the following language:
"In numerous cases this court has held that although a venireman has formed an opinion, from rumor and the reading of newspapers, that would take evidence to remove, he is qualified if he can go into the jury box and give both the State and the defendant a fair and impartial trial and base his verdict on the evidence introduced in the case and instructions of the court. Hardin v. State, 66 Ark. 53, 48 S.W. 904; Ham v. State, 179 Ark. 20, 13 S.W.2d 805; West v. State, 150 Ark. 555, 234 S.W. 997; Niven v. State, 190 Ark. 514, 80 S.W.2d 644. There it was pointed out that the veniremen had not talked with any witness; Howell v. State, 220 Ark. 278, 247 S.W.2d 952; Leggett v. State, 227 Ark. 393, 299 S.W.2d 59. In Lauderdale v. State, 233 Ark. 96, 343 S.W.2d 422, it was pointed out that the venireman had not talked to a witness.
But we have been cited to no case, and we have found none, holding that one is qualified to serve on a jury who has talked with a witness in the case and has formed an opinion that would take evidence to remove. We have at least two cases holding to the contrary. Caldwell v. State, 69 Ark. 322, 63 S.W. 59; Lane v. State, 168 Ark. 528, 270 S.W. 974. The court erred in holding the venireman, Laws, to be qualified to serve as a juror."
As we said in Stout v. State, (1970), 448 S.W.2d 636, and later in Pointer v. State, (1970), 454 S.W.2d 91, an accused does not have the right to have a jury of his choice from the panel selected, but an accused only has the right to a competent, fair and impartial jury. As stated in Stout, the privilege of peremptory challenge in selecting a jury is not a right of selection, it is a privilege of rejection. 47 Am.Jur.2d, Jury, § 233.
I recognize, as I think everyone must, that intelligent inquiring minds acquire ideas and form opinions from what is read and heard, and that practically every law-abiding citizen is prejudiced to varying degrees against crime and criminals. Consequently, in the selection of a jury to try a criminal case, the important question is not so much whether a juror has formed an opinion or is prejudiced; the important question is whether the citizen, when carrying out his duties as a juror, can lay aside his opinions and prejudices and give the accused a fair trial. An accused is not entitled to a trial before a jury of robots, he is entitled to a trial before honest jurors who are intelligent enough to recognize their own opinions and prejudices and honest enough to say so if they are unable to fairly and impartially try the accused.
I feel that the majority have overreacted to the United States Supreme Court decision in Irvin v. Dowd, supra, and have let the results reached by the court on the facts in that case stand as a solemn mandate and rigid rule of law to be applied and followed in the case at bar under an entirely different set of facts. In other words, it appears to me that the majority are reading more into the decision in Irvin v. Dowd, than I am able to read out of it. In the Irvin case it is perfectly clear that the news media had fanned the flames of normal prejudice against crime and criminals to the point where mere opinions were converted into fixed and established facts, and reason was consumed, lost or abandoned in the process; even the reason of prospective *683 jurors. In other words, the newspapers had successfully kindled a fire of public opinion against Irvin and then fanned and fed the flame until no amount of cold reason could cool its searing effect, and nothing less than the life of Irvin could extinguish it. Such was the situation in the Irvin case, but such was not the situation in the case at bar.
As I view the decision in the Irvin case, it is actually a scorching, and well deserved indictment of the news media, aided and abetted by a sheriff and a prosecuting attorney, in pre-trying Irvin to the extent that he stood convicted before trial, not only for the crimes with which he was charged in Indiana, but for all the crimes and misdemeanors ever committed by him or of which he was ever accused. The syllabus alone in Irvin v. Dowd, sets it poles apart from the case at bar for it contains the following statement:
"At the trial, the jury panel consisted of 430 persons; 268 of these were excused for cause as having fixed opinions as to the guilt of petitioner; and 8 of the 12 who finally served on the jury admitted that they thought petitioner was guilty, but each indicated that, notwithstanding his opinion, he could render an impartial verdict." (Emphasis added.)
Irvin was accused of murdering six people; he was tried and convicted in Indiana and his case reached the United States Supreme Court by certiorari. The build up of prejudice through the newspapers in Irvin v. Dowd, went much further than the average person would conceive that responsible news media would go. As pointed out by Mr. Justice Clark, it was alleged, in the motion for a new trial, that curbstone opinions were solicited and recorded by the newspapers on the public streets and not only as to the appellant's guilt, but even to what punishment he should receive. A barrage of newspaper headlines, articles, cartoons and pictures were unleashed against the appellant during six or seven months preceding his trial. The news stories revealed the details of the appellant's background including reference to crimes committed when he was a juvenile, his convictions for arson almost 20 years previously, for burglary and by a court martial on AWOL charges during the war. He was accused of being a parole violator. The headlines announced his police lineup identification; that he faced a lie detector test, had been placed at the scene of the crime, and that the six murders were solved but petitioner refused to confess. The newspapers later announced his confession to the six murders and the fact of his indictment for four of them in Indiana. They reported petitioner's offer to plead guilty if promised a 99-year sentence, but also the determination on the other hand of the prosecutor to secure the death penalty, and that petitioner had confessed to 24 burglaries (the modus operandi of these robberies was compared to that of the murders and the similarity noted). One story dramatically relayed the promise of a sheriff to devote his life to securing petitioner's execution by the state of Kentucky, where the petitioner was alleged to have committed one of the six murders, if Indiana failed to do so. Another article characterized petitioner as remorseless and without conscience but also as having been found sane by a court-appointed panel of doctors. In many of the stories petitioner was described as "the confessed slayer of six," a parole violator and fraudulent-check artist. Petitioner's court-appointed counsel was quoted as having received "much criticism over being Irvin's counsel" and it was pointed out, by way of excusing the attorney, that he would be subject to disbarment should he refuse to represent Irvin. On the day before the trial the newspapers carried the story that Irvin had orally admitted the murder of Kerr (the victim in the case) as well as "the robbery-murder of Mrs. Mary Holland; the murder of Mrs. Wilhelmina Sailer in Posey County, and the slaughter of three members of the Duncan family in Henderson County, Kentucky." On the second day of Irvin's trial, which was devoted to the selection of the jury, the newspapers reported that "strong feelings, *684 often bitter and angry, rumbled to the surface," and that "the extent to which the multiple murders three in one family have aroused feelings throughout the area was emphasized Friday when 27 of the 35 prospective jurors questioned, were excused for holding biased pretrial opinions. * * *" A few days later the feelings were described as "a pattern of deep and bitter prejudice against the former pipe fitter." Spectator comments, as printed by the newspapers, were "my mind is made up"; "I think he is guilty"; and "he should be hanged."
The news reporting in Irvin v. Dowd was almost as revolting as the crime itself in the case at bar, and certainly I have no quarrel with the results reached in Irvin under the facts of that case. In Irvin we have only the facts as reported through the news media, and in the case at bar we have only the facts as testified by witnesses at the trial of the case. An additional important distinction stands out in Irvin in the following language:
"An examination of the 2,783 page voir dire record shows that 370 prospective jurors or almost 90% of those examined on the point (10 members of the panel were never asked whether or not they had any opinion) entertained some opinion as to guilt ranging in intensity from mere suspicion to absolute certainty. A number admitted that, if they were in the accused's place in the dock and he in theirs on the jury with their opinions, they would not want him on a jury."
The important and decisive point in Irvin v. Dowd, as well as further distinction from the case at bar, is stated in Irvin v. Dowd. as follows:
"Here the `pattern of deep and bitter prejudice' shown to be present throughout the community, cf. Stroble v. California, 343 U.S. 181, 72 S.Ct. 599, 96 L.Ed. 872, was clearly reflected in the sum total of the voir dire examination of a majority of the jurors placed in the jury box. Eight out of the 12 thought petitioner was guilty. * * * Where one's life is at stake and accounting for the frailties of human nature we can only say that in the light of the circumstances here the finding of impartiality does not meet constitutional standards. Two-thirds of the jurors had an opinion that petitioner was guilty and were familiar with the material facts and circumstances involved, including the fact that other murders were attributed to him, some going so far as to say that it would take evidence to overcome their belief. One said that he `could not * * give the defendant the benefit of the doubt that he is innocent.' Another stated that he had a `somewhat' certain fixed opinion as to petitioner's guilt. No doubt each juror was sincere when he said that he would be fair and impartial to petitioner, but psychological impact requiring such a declaration before one's fellows is often its father. Where so many, so many times, admitted prejudice, such a statement of impartiality can be given little weight." (Emphasis added.)
In my opinion the court in Irvin v. Dowd, indicates it would probably have reached a different result had the facts in that case been such as we have in the case at bar. Quoting from Reynolds v. United States, 98 U.S. 145, 155, 25 L.Ed 244, the court in Irvin v. Dowd, states:
"It is not required, however, that the jurors be totally ignorant of the facts and issues involved. In these days of swift, widespread and diverse methods of communication, an important case can be expected to arouse the interest of the public in the vicinity, and scarcely any of those best qualified to serve as jurors will not have formed some impression or opinion as to the merits of the case.
This is particularly true in criminal cases. To hold that the mere existence of any preconceived notion as to the guilt or innocence of an accused, without more, is sufficient to rebut the presumption of a *685 prospective juror's impartiality would be to establish an impossible standard. It is sufficient if the juror can lay aside his impression or opinion and render a verdict based on the evidence presented in court. Spies v. Illinois, 123 U.S. 131, 8 S.Ct. 21, 31 L.Ed. 80; Holt v. United States, 218 U.S. 245, 31 S.Ct. 2, 54 L.Ed. 1021; Reynolds v. United States, supra.
The adoption of such a rule, however, `cannot foreclose inquiry as to whether, in a given case, the application of that rule works a deprivation of the prisoner's life or liberty without due process of law.' Lisenba v. California, 314 U.S. 219, 236, 62 S.Ct. 280, 86 L.Ed. 166. As stated in Reynolds, the test is `whether the nature and strength of the opinion formed are such as in law necessarily * * * raise the presumption of partiality. The question thus presented is one of mixed law and fact. * * *' At 98 U.S. p. 156. `The affirmative of the issue is upon the challenger. Unless he shows the actual existence of such an opinion in the mind of the juror as will raise the presumption of partiality, the juror need not necessarily be set aside. * * * If a positive and decided opinion had been formed, he would have been incompetent even though it had not been expressed.' At p. 157. As we stated in Brown v. Allen, 344 U.S. 443, 507, 73 S.Ct. 397, 97 L.Ed. 469, the `so-called mixed questions or the application of constitutional principles to the facts as found leave the duty of adjudication with the federal judge.' It was, therefore, the duty of the Court of Appeals to independently evaluate the voir dire testimony of the impaneled jurors."
I fail to find authority, or even a suggestion in Irvin v. Dowd, that would justify us, on the facts in the case at bar, in abandoning the procedure we have followed in our own cases, supra, and adopting as a procedural rule of law, the results reached by the United States Supreme Court on the bizarre facts of an Indiana case completely different and foreign to the facts in the case at bar. I would continue to follow the rules we have heretofore followed, and continue to inquire in each given case, whether the application of the rule works a deprivation of the prisoner's life or liberty without due process of law. In the case at bar, I am convinced that it did not.
I would affirm the trial court on all points. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399920/ | 977 F.Supp. 1046 (1997)
FLUID COMPONENTS INTL., Plaintiff,
v.
CORPORATE BENEFIT CONSULTANTS; Executive Strategies and Insurance Services, Inc.; California Central Trust Bank Corporation dba Caltrust; Roger Renfro, Renate Renfro, and Does 1 Through 100, Inclusive, Defendant(s).
No. 96CV2069 BTM (CGA).
United States District Court, S.D. California.
July 30, 1997.
*1047 Michael Wischkaemper, Law Offices of Michael Wischkaemper, Carlsbad, CA, for Fluid Components Intl.
Michael L. Wachtell, Buchalter, Nemer, Fields and Younger, Los Angeles, CA, for Corporate Benefit Consultants.
Roger D. Renfro, Renfro and Associates, Irvine, CA, Michael L. Wachtell, Buchalter, Nemer, Fields and Younger, Los Angeles, CA, G. Forsythe Bogeaus, Buchalter, Nemer and Younger, Los Angeles, CA, for Excutive Strategies and Ins. Services, Inc.
Timothy R. Pestotnik, Luce, Forward, Hamilton and Scripps, San Diego, CA, Michael L. Wachtell, Buchalter, Nemer, Fields & Younger, Los Angeles, CA, for California Central Bank Corp.
Roger D. Renfro, Renfro and Associates, Irvine, CA, pro se.
Michael L. Wachtell, Buchalter, Nemer, Fields & Younger, Los Angeles, CA, for Roger Renfro.
Timothy R. Pestotnik, Luce, Forqard, Hamilton & Scripps, San Diego, CA, Roger D. Renfro, Renfro and Associates, Irvine, CA, Michael Wachtell, Buchalter, Nemer, Fields & Younger, Los Angeles, CA, for Renate Renfro.
ORDER DENYING MOTION TO DISMISS AND REMANDING THE CASE
MOSKOWITZ, District Judge.
I. INTRODUCTION
Plaintiff Fluid Components Intl. ("FCI") is the sponsor of a defined benefit plan (the "Plan") qualified under the Employer Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq. (First Amended Complaint ("Complaint") ¶ 10.) Defendants are companies and individuals who acted as professional consultants to FCI in the creation and operation of the Plan. Plaintiffs originally filed this case in state court and Defendants subsequently removed it based on ERISA preemption of Plaintiff's claims. Defendants have made a motion to dismiss on the basis of ERISA preemption. The parties have stipulated that should the Court deny the motion to dismiss, the entire action should be remanded to state court.
Plaintiff's claims are pleaded as state law claims for negligence, intentional misrepresentation, negligent misrepresentation, breach of common law fiduciary duty and nondisclosure of known facts. The question before the Court is whether ERISA preempts a state law claim for an outside consultant's malpractice based on consulting and administrative services performed for Plaintiff's ERISA plan. While the scope of ERISA preemption is broad, the Court finds that ERISA does not preempt these state law claims. Accordingly, Defendants motion to dismiss is denied and the entire action is remanded to state court.
II. FACTUAL ALLEGATIONS
Plaintiff FCI is an employer in San Marcos, California that sponsors and maintains a defined benefit plan for its employees. The Plan was established according to federal law under ERISA. (Complaint ¶ 10.) The purpose of the Plan is to provide Plaintiff's employees with a tax-sheltered retirement income. (Id.) Defendants contributed administrative and consulting services for the Plaintiff's Plan. (Id. ¶ 18.) Plaintiff asserts that some of the Defendants helped organize the Plan and assisted with its initial operation. (Id. ¶ 11.) The complaint also alleges that all Defendants provided consulting and administrative services for the Plan and that Plaintiff relied on Defendants as experts. (Id. ¶¶ 11, 12, 13.)
Plaintiff alleges three main problems with the advice provided to FCI by Defendants. Two of the problems involve advice given in the Plan's operation, while the third concerns incorrect calculations made by Defendants and communicated to and relied upon by Plaintiff. Plaintiff's first claim is that the *1048 Defendants advised them to use a sex-distinct mortality table called IAM-71 for purposes of calculating benefits. (Id. ¶ 49.) In 1983, the Supreme Court held that the use of sex-distinct mortality tables for benefit calculations resulted in unequal treatment of males and females and was, therefore, forbidden by Title VII of the 1964 Civil Rights Act (42 U.S.C. § 2000e et seq.) Arizona Gov. Comm., for Tax Deferred Annuity and Deferred Compensation Plans v. Norris, 463 U.S. 1073, 1095, 103 S.Ct. 3492, 3505, 77 L.Ed.2d 1236 (1983).
Plaintiff claims that Defendants advised FCI to utilize an Amended Defined Benefit Plan in 1985 which continued to include the mortality table IAM-71. (Id. ¶ 48-49.) Defendants proceeded to calculate benefits based on these sex-distinct tables until 1993. (Id. ¶ 52.) In 1993, Defendants changed their calculation method and decided to calculate benefits for both sexes with reference solely to the male table of IAM-71. (Id. ¶ 53.) Thus, from 1993 to 1996, Defendants calculated all female benefits by using the male mortality table, instead of the female table. (Id. ¶ 54.) This created a problem since the female table required higher payments. (Id.) As a result, Plaintiff contends that all of the benefits paid to females during that time were inadequate, and the Plan was required to compensate those females. (Id.)
The complaint further alleges that "[D]efendants advised FCI to have the Plan pay males based upon the male mortality table in IAM-71 and calculate all benefits by males based upon the same table, which was a violation of law." (Id. ¶ 55.) Plaintiff asserts that all of the calculated benefits paid by the Plan to males have not been adequate. (Id.) In its effort to compensate underpaid plan members and correct the problems caused by Defendants' acts, FCI claims it is now forced to contribute the necessary funds to the Plan. (Id. ¶ 61.)
Plaintiff also claims that starting in 1987, Defendants adopted an improper vesting schedule for the Plan which increased FCI's liability to the Plan. (Id. ¶ 56.) In addition, Plaintiff alleges that Defendants incorrectly calculated the projected benefit obligations of the Plan. (Id. ¶¶ 26-30.) "The Projected benefit Obligation is an estimate of the amount which the Plan is likely to be required to pay in the future." (Id. ¶ 23.) As a result of Defendants' miscalculations, FCI asserts that it was forced to freeze the Plan which caused all future Plan obligations to be based on the compensation rates before the Plan was frozen. (Id. ¶ 40.) FCI claims that had it known of the incorrect calculations, it would have revised the Plan to use a single mortality table for all participants, which would have created a smaller liability for FCI resulting in considerable savings. (Id. ¶¶ 41, 43.) Plaintiff claims that at all relevant times Defendants knew that the Plan was operating in violation of law by the use of a sex-based mortality table. (Id. ¶ 113.)
III. DISCUSSION
ERISA is "a comprehensive statute designed to promote the interests of employees and their beneficiaries in employee benefit plans." Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 90, 103 S.Ct. 2890, 2896, 77 L.Ed.2d 490 (1983). Congress sought to eliminate the problem of inconsistent state and local regulation in the area of employee benefit plans by enacting express statutory preemption provisions as part of ERISA. Under 29 U.S.C. § 1144(a), ERISA preempts "any and all State laws insofar as they may now or hereafter relate to any employee benefit plan." State law includes "all laws, decisions, rules, regulations or other State action having the effect of law." 29 U.S.C. § 1144(c)(1). "To ensure uniformity and consistency in such laws throughout the states, Congress included within ERISA `one of the broadest preemption clauses ever enacted by Congress.'" Aloha Airlines Inc., v. Ahue, 12 F.3d 1498, 1501 (1993), (quoting Evans v. Safeco Life Ins. Co., 916 F.2d 1437, 1439 (9th Cir.1990)).
A. Supreme Court Case Law on ERISA Preemption
In Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 95-96, 103 S.Ct. 2890, 2899-2900, 77 L.Ed.2d 490 (1983), the Supreme Court addressed the issue of ERISA preemption by determining whether the New York Human Rights Law and the New York Disability *1049 Benefits Law were preempted by ERISA. "In deciding whether a federal law prepreempts a state statute, our task is to ascertain Congress' intent in enacting the federal statute at issue." Id. "A state law `relates to' an employee benefit plan, in the normal sense of the phrase, if it has a connection with or reference to such a plan." Id. at 97, 103 S.Ct. at 2900. The Court also recognized that the ERISA preemption provision is unusually broad. The breadth of ERISA preemption was noted in Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 139, 111 S.Ct. 478, 482-83, 112 L.Ed.2d 474 (1990), when the Court stated that "even if the law is not specifically designed to affect such [a] plan[], or the effect is only indirect," it could still be preempted.
However, despite the expansive scope of ERISA's preemption clause, the Shaw Court recognized that it is not unlimited in its application. The Supreme Court noted that certain state laws which affect ERISA plans in "too tenuous, remote or peripheral a manner" do not "relate to" plans within the meaning of the preemption clause. Shaw, 463 U.S. at 100 n. 21, 103 S.Ct. at 2901 n. 21. Thus, a variety of state laws have not been preempted because courts have found that their connection to ERISA plans was too remote. See, e.g., Aetna Life Ins. Co. v. Borges, 869 F.2d 142, 147-49 (2d Cir.1989) (impact of Connecticut's escheat law on ERISA plans too remote to require preemption); Employee Staffing Serv., Inc. v. Aubry, 20 F.3d 1038 (9th Cir.1994) (California workers' compensation statute that required employer to maintain separately administered workers' compensation plan withstood preemption since it does not tell employers how to write their ERISA plans).
In Mackey v. Lanier Collection Agency & Service, Inc., 486 U.S. 825, 832-34, 108 S.Ct. 2182, 2186-88, 100 L.Ed.2d 836 (1988), the Supreme Court held that ERISA does not preempt every state law claim that relates to an ERISA plan. In particular, Mackey decided that a state law garnishment provision was not preempted when used to collect a judgment against an ERISA plan participant. The Court stated, "lawsuits against ERISA plans for run-of-the-mill state-law claims such as unpaid rent, failure to pay creditors, or even torts committed by an ERISA plan" are not preempted by ERISA. Id.
In New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 115 S.Ct. 1671, 131 L.Ed.2d 695 (1995), the United States Supreme Court again restricted the coverage of the "relate to" language of the preemption clause. The Court recognized the need to "go beyond the unhelpful text" of the preemption clause and "look instead to the objectives of the ERISA statute as a guide to the scope of the state law that Congress understood would survive." Id. at 656, 115 S.Ct. at 1677. Thus, the Court held that New York's hospital surcharge laws were not preempted even though these laws had an indirect economic impact on ERISA plans. Id. at 657-63, 115 S.Ct. at 1678-80.
B. Ninth Circuit Case Law on ERISA Preemption
The Ninth Circuit has stated that "distinguishing between state laws that `relate to' [ERISA] and those that have only a `tenuous, remote, or peripheral impact' upon such plans is not a simple task." Aloha Airlines, 12 F.3d at 1504. Some analytical assistance was provided in Gibson v. Prudential Ins. Co. of America, 915 F.2d 414, 416 (9th Cir. 1990), where the Ninth Circuit held that "[t]he ERISA preemptive provision is to be broadly construed and extends to common law tort and contract theories."
The Aloha Airlines court established four factors to consider in determining whether a state law "relates to" an ERISA plan and should be preempted. They are as follows:
(1) whether the state law regulates the types of benefits of ERISA employee welfare benefit plans; (2) whether the state law requires the establishment of a separate employee benefit plan to comply with the law; (3) whether the state law imposes reporting, disclosure, funding, or vesting requirements for ERISA plans; and (4) whether the state law regulates certain ERISA relationships, including the relationship between an ERISA plan and employer and, to the extent an employee benefit *1050 plan is involved, between the employer and the employee.
Aloha Airlines 12 F.3d at 1504 (citations omitted). The Court also noted that "laws of general application often traditional exercises of state power or regulatory authority whose effect on ERISA plans is incidental" are not preempted on account of having too remote or peripheral relationship with ERISA. Id.
C. Malpractice Issue
The Court now turns to the merits of this case, whether Plaintiff's state law claims are preempted by ERISA. It is important to bear in mind that the Defendants were an outside consultant hired to advise Plaintiff on setting up the Plan. The issue of whether a third party consultant can be sued under state claims for malpractice has not been adequately addressed by the Ninth Circuit. However, the Third and Tenth Circuits, as well as several district courts in the Ninth Circuit have discussed this issue.
The Third Circuit in Painters of Phila. Dist. Council No. 21 Welfare Fund v. Price Waterhouse, 879 F.2d 1146, 1153 n. 7 (3d Cir.1989), clarified that ERISA "does not generally preempt state professional malpractice actions." The court, relying on the Supreme Court's decision in Mackey, stated in pertinent part:
We feel that professional malpractice actions brought by a plan are directly analogous to the situation in Mackey, and that, in the absence of an explicit corresponding provision in ERISA allowing a professional malpractice cause of action, Congress did not intend to preempt a whole panoply of state law in this area. Thus, we conclude that ERISA does not generally preempt state professional malpractice actions.
Id. The Painters court further held that because malpractice is traditionally an area of state concern, and because there is absolutely no indication that Congress intended to imply a cause of action under ERISA for professional malpractice, state malpractice claims are not preempted. Id. at 1152-53.
The malpractice issue was also addressed by the Tenth Circuit in Airparts Co. v. Custom Ben. Services of Austin, 28 F.3d 1062 (10th Cir.1994). The Tenth Circuit relied on Painters to decide that state law claims of professional negligence, implied-indemnity, and common law fraud against a firm hired by the plaintiffs to provide expert benefit plan consultation were not preempted by ERISA. Id. at 1064. As in this case, the defendants were outside consultants hired to advise plaintiff about the plan. Id. The court held,
[I]t is clear that the state law claims here do not relate to an ERISA plan. The state laws involved do not regulate the type of benefits or terms of the plan; they do not create reporting, disclosure, funding or vesting requirements for the plan; they do not affect the calculation of benefits; and they are not common law rules designed to rectify faulty plan administration.... [S]tate laws of negligence, indemnity, and fraud are "laws of general application not specifically targeting ERISA plans that involve traditional areas of state regulation and do not affect `relations among the principal ERISA entities.'"
Id. at 1065-66, (quoting National Elevator Indus., Inc. v. Calhoon, 957 F.2d 1555, 1559 (10th Cir.1992)). The court concluded that there were no congressional purposes to be furthered by denying an ERISA plan a state cause of action against allegedly negligent third-party service providers. Id. at 1066. See also Custer v. Sweeney, 89 F.3d 1156 (4th Cir.1996) (holding Plan trustee's action against attorney for malpractice not preempted).
Recent decisions by district courts in the Ninth Circuit are consistent with Painters and Airparts. In Hanovi Corp. v. San Francisco Pension Corp., No. C-93-2822 MHP, 1993 WL 548809 (N.D.Cal. Dec.15, 1993), plaintiffs brought a professional negligence action against the consultants hired to advise them on their defined benefit pension plan. Id. at *1. As in Airparts and Painters, the court held that state negligence law, employed by plaintiffs to state a claim for professional malpractice, does not "relate to" the Plan so as to compel preemption of the claim by ERISA. Id. at *3. "State negligence law does not affect the parties in any ERISA capacity but rather in the way that all other *1051 professionals and their clients are affected." Id. The reasoning behind the court's decision was that since this was "an action for simple malpractice brought by a client against its consultant; there [was] no federal interest at stake to justify th[e] court's continued control of the action." Id. See also, Zandi-Dulabi v. Pacific Retirement Plans, Inc., 828 F.Supp. 760 (N.D.Cal.1993), Bourns, Inc. v. KPMG Peat Marwick, 876 F.Supp. 1116 (C.D.Cal.1994) (finding no preemption of state claims for professional negligence on services provided to the benefit plan). The Bourns court concluded that ERISA does not regulate the relationship between a plan (or plan sponsor) and its accountant in a matter that is comprehensive enough to justify ERISA preemption of related state claims. Id. at 1121. Similarly, the relationship between Plaintiff FCI and Defendants does not warrant ERISA preemption. As in Hanovi, the relationship at issue here is between professional consultants and their client. It is, therefore, entitled to the same analysis and conclusion.
The Defendants' reliance on Gibson v. Prudential Ins. Co. Of America, 915 F.2d 414 (9th Cir.1990) is misplaced. Gibson involved a suit by a plan beneficiary for disability payments under the plan. The Ninth Circuit held that the state claims against nonfiduciaries were preempted. However, the court made clear that preemption applied because the claim was essentially for benefits by a plan beneficiary. Id. at 417 n. 3. Similarly, Defendants' reliance on Concha v. London, 62 F.3d 1493 (9th Cir.1995) is unavailing as there, defendants, who were within the definition of "parties in interest" under 29 U.S.C. § 1002(14)(b), were sued for prohibited transactions under 29 U.S.C. § 1106(a)(1). No such claims exist here.
In light of present case law, the Court finds that Plaintiff's state law claims for negligence, intentional misrepresentation, negligent misrepresentation, breach of common law fiduciary duty and nondisclosure of known facts are not preempted by ERISA. All of the state claims relate to the alleged malpractice of a third party professional consulting firm hired to advise Plaintiff on the administration of their ERISA plan. Although ERISA preemption is broad enough to encompass most state claims, it is not unlimited in its scope. Where, as here, ERISA does not provide a corresponding remedy for malpractice by an outside party, it does not appear that Congress intended to foreclose the appropriate state laws of general application created to provide redress for professional negligence.
IV. CONCLUSION
For the reasons stated above, the Court hereby finds that the Plaintiff's state claims are not preempted. Defendants' motion to dismiss is hereby DENIED. The entire action is REMANDED to the Superior Court of California for the County of San Diego. The Court does not reach the remaining arguments for dismissal of the state claims as it lacks jurisdiction.
IT IS SO ORDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399921/ | 243 Pa. Superior Ct. 177 (1976)
364 A.2d 718
In re Appeal of Mickey George COWELL, Appellant (a juvenile).
Superior Court of Pennsylvania.
September 27, 1976.
*180 John Sughrue, Public Defender, Clearfield, for appellant.
Richard A. Bell, Dist. Atty., Clearfield, for appellee.
Before WATKINS, President Judge, and JACOBS, HOFFMAN, CERCONE, PRICE, VAN der VOORT and SPAETH, JJ.
CERCONE, Judge.
This is an appeal from an order of the lower court adjudicating Mickey George Cowell, a delinquent on the basis of an incident which occurred at a grocery store in Beccaria Township, Clearfield County.
On June 11, 1974, in the early morning hours, Miss Jean Skonier surprised prowlers in her grocery store who beat and robbed her. At that time a juvenile, Randy Kephart, was wounded, and subsequently died, allegedly as a result of the wounds he sustained. Miss Skonier identified appellant as the person who robbed her and beat her into insensibility. At the conclusion of the hearing in the Juvenile Division of the court in this matter in August of 1974, the court held that the charges of burglary, theft, robbery, recklessly endangering another person, and assault were sufficiently made out against *181 appellant and found him delinquent. The court committed appellant to the State Correctional Institution at Camp Hill, Pennsylvania.
Appellant's first contention is that the Juvenile Court lacked jurisdiction over his person, because he was returned to Clearfield County from Cleveland, Ohio in a manner not conforming to the Interstate Compact on Juveniles.[1] Although not all the details of appellant's apprehension and return to Pennsylvania are within the record, it is undisputed that neither of the procedures described in Article V of the Compact were followed.[2] The Cleveland Police received information concerning appellant's involvement in the incident, took him into custody some time between June 17 (the date the petition alleging delinquency was filed) and July 5, 1974, and placed him in the local Juvenile Detention Center. On the latter date the court in Pennsylvania issued an order authorizing and empowering John R. Anderson, Sheriff of *182 Clearfield County, and Trooper Wrabel to proceed to Cleveland for the purpose of obtaining custody of appellant and returning him to Clearfield County. Sheriff Anderson and Trooper Wrabel went to Cleveland, showed the person in charge of the Detention Center (a Mr. Robert Horley) the order and a copy of the petition, and were thereupon presented with appellant, whom they forthwith brought back to Clearfield County. No Ohio court passed judgment on the legality of appellant's detention or his removal to Pennsylvania.
The Commonwealth's argument that the Juvenile Court obtained jurisdiction over the person of appellant when the petition alleging delinquency was filed is without merit. Once Trooper Wrabel and Sheriff Anderson arrived in Ohio, their right to take appellant into custody was governed by Ohio law. Section 2151.31(B) of the Ohio Revised Code[3] provides that a child may be taken into custody pursuant to the laws of arrest. Our reading of Ohio arrest law discloses only one situation in which a Pennsylvania law enforcement official could make an arrest in Ohio, and that is when he enters that state in fresh pursuit of a suspected felon.[4] This provision obviously has no application to the instant case.
The illegality of the procedure here employed is manifest. However, the dispositive question is what relief does the manner of appellant's apprehension entitle him to? The manner in which a person is brought into a state, once he has been given notice of the charges against him by indictment or information, does not affect the right of the state to try him for crimes committed within its borders. Frisbie v. Collins, 342 U.S. 519, 72 S.Ct. 509, 96 L.Ed. 541 (1952); Ker v. Illinois, 119 U.S. 436, 7 S.Ct. 225, 30 L.Ed. 421 (1886); Commonwealth *183 ex rel. Eberle v. Rundle, 202 Pa.Super. 84, 195 A. 2d 161 (1963); Commonwealth ex rel. Master v. Baldi, 166 Pa.Super. 413, 72 A.2d 150 (1950). The general rule that illegal arrest or detention does not void a subsequent conviction was most recently reaffirmed by the Supreme Court in Gerstein v. Pugh, 420 U.S. 103, 119, 95 S.Ct. 854, 43 L.Ed.2d 54 (1975). The rationale for the rule was explained in In re Johnson, 167 U.S. 120, 125-26, 17 S.Ct. 735, 737, 42 L.Ed. 103 (1897):
"[I]t has been the settled doctrine of this court that a court having possession of a person or property cannot be deprived of the right to deal with such person or property until its jurisdiction is exhausted . . . .
Although it has been frequently held that, if a defendant in a civil case be brought within the process of the court by a trick or device, the service will be set aside, and he will be discharged from custody. . . . The law will not permit a person to be kidnapped or decoyed within the jurisdiction for the purpose of being compelled to answer to a mere private claim, but in criminal cases the interests of the public override that which is, after all, a mere privilege from arrest." (Citations omitted.)
Although a juvenile proceeding is not, strictly speaking, a criminal proceeding, it is clear that the interest of the state in protecting its citizens against criminal acts committed by juveniles is not a "mere private claim." This interest and the Commonwealth's interest in the welfare of the juvenile must be balanced against the desirability of deterring the shortcutting of legal process by law enforcement officials. On this basis we conclude that the Ker-Frisbie rule is equally applicable to juvenile delinquency proceedings.[5] It follows that the *184 only relief to which the manner of appellant's apprehension and detention entitles him (aside from any civil remedy he might wish to pursue) is the exclusion of any evidence obtained by exploiting the illegality. The record discloses that an application to suppress certain statements made while appellant was in transit was granted. Appellant's person is not suppressible. See Commonwealth v. Krall, 452 Pa. 215, 304 A.2d 488 (1973).
Appellant's second assignment of error is that the procedure by which he was adjudged delinquent denied him due process.[6] In support of this claim appellant cites several rulings of the court below. The first complaint under this heading is that all attempts by appellant's counsel for pre-trial discovery were frustrated. Prior to hearing, counsel filed two discovery motions, one labeled as such and one captioned "Demand for Brady material."[7] These motions called for all the information which the Commonwealth had in its possession relative to the case. Pennsylvania policy on discovery is set forth in Rule 310 of Pennsylvania Rules of Criminal Procedure, 19 P.S.Appendix (1975). The rule provides for discovery of written statements of a defendant, forbids discovery of statements of witnesses, and permits other discovery or inspection only on proof of "exceptional circumstances and compelling reasons." The court *185 held in Commonwealth v. Ware, 459 Pa. 334, 368-69, 329 A.2d 258, 275-76 (1974):
"The rule does not purport to grant defendant a hearing as of right in which to prove `exceptional circumstances and compelling reasons.' In order to be entitled to a hearing, he must at least allege circumstances and reasons, which, if established, would be exceptional and compelling."
Neither of appellant's motions contained any necessary allegations of exceptional and compelling reasons for additional disclosure. The court's summary dismissal of the demands at the beginning of the disposition hearing was therefore proper. As the Supreme Court observed in Moore v. Illinois, 408 U.S. 786, 795, 92 S.Ct. 2562, 2568, 33 L.Ed.2d 706 (1972): "We know of no constitutional requirement that the prosecution make a complete and detailed accounting to the defense of all police investigatory work on a case."
Appellant had a right under Brady to any exculpatory evidence in the possession of the prosecution. The only evidence fitting that description was a telephone call to Sheriff Anderson from a person in Cleveland who claimed that appellant could not have committed the acts charged because he was in Cleveland at the time they were committed. Upon ascertaining, at the opening of the hearing, that counsel had full knowledge of the telephone conversation, including the identity of the caller, the court pronounced itself satisfied that there was no exculpatory evidence held by the Commonwealth of which the defense was unaware.
Appellant also takes issue with the limitations the court imposed on his cross-examination of Trooper Wrabel. When defense counsel attempted to elicit from the Trooper the details of another person's involvement in the crime, the Commonwealth objected. The court *186 sustained the objection on the ground that counsel was "getting too far afield," and that the alleged involvement of the other person was not relevant to the allegations against appellant. Counsel responded as follows:
"Mr. Tumpson: Clearly that's correct, Your Honor, and I agree with everything this Court says, except we asked for scientific results in our discovery. We asked if they had any other suspects. Now, this officer has testified
The court's reaction:
Now, Mr. Tumpson, you've known for months that Mr. Moore was involved in this matter, or at least alleged to have been involved in this matter. That was in the newspaper. Proceed."
At that point counsel informed the court that he had every one of those clippings in his file. The colloquy between the court and appellant's counsel demonstrated that the exception taken to the court's ruling was quickly abandoned by appellant's counsel and fails to preserve for our review any other ground for excepting to the ruling. See Commonwealth v. Stoltzfus, 462 Pa. 43, 337 A. 2d 873 (1975).
Appellant's final due process argument asserts that the court erroneously refused to allow him to inspect the pretrial statements of Miss Skonier and Trooper Wrabel after those witnesses had completed their respective direct testimony. We agree. A defendant in a criminal case has a right to such inspection upon timely request once direct examination is completed. Commonwealth v. Morris, 444 Pa. 364, 281 A.2d 851 (1971); Commonwealth v. Kontos, 442 Pa. 343, 276 A.2d 830 (1971); Commonwealth v. Smith, 417 Pa. 321, 208 A.2d 219 (1965); Commonwealth v. Robinson, 229 Pa. Super. 131, 324 A.2d 441 (1974); Commonwealth v. Swierczewski, 215 Pa.Super. 130, 257 A.2d 336 (1969). The ideal time for such a request is at the end of direct *187 examination. Instantly, both requests were made during cross-examination. However, it is our opinion that a request is timely if it is made at any point at which granting it will enhance the effectiveness of cross-examination and not unfairly prejudice the Commonwealth. Among those rights which the Supreme Court extended by its decision in In re Gault, 387 U.S. 1, 87 S.Ct. 1428, 18 L.Ed. 2d 527 (1967) to juveniles facing determinations of delinquency was the right of cross-examination; and, none of the differences of philosophy or purpose between juvenile courts and adult criminal courts justify a refusal to extend the rule to delinquency hearings.
Accordingly, the case is remanded for a new hearing to be conducted in a manner not inconsistent with this opinion.
SPAETH, J., files a concurring and dissenting opinion.
SPAETH, Judge (concurring and dissenting).
In other areas of the law, both criminal and civil, the courts have been resourceful in fashioning remedies to deter lawless official conduct. For example, in the criminal law, the exclusionary rule was made applicable to the states in Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081 (1961), as a deterrent to official violations of the personal privacy and security guaranteed by the Fourth Amendment, and in the civil, the federal courts have not hesitated to order reapportionment of state legislatures where official inaction or purposeful discrimination has diluted a citizen's right to vote. See, e.g., Reynolds v. Sims, 377 U.S. 533, 567, 84 S.Ct. 1362, 1384, 12 L.Ed. 506 (1964) ("[t]o the extent that a citizen's right to vote is debased, he is that much less a citizen"); Gomillion v. Lightfoot, 364 U.S. 339, 347, 81 S.Ct. 125, 130, 5 L.Ed.2d 110 (1960) ([w]hile in form this is merely an act redefining metes and bounds, if the allegations *188 are established, the inescapable human effect of this essay in geometry and geography is to despoil colored citizens, and only colored citizens, of their theretofore enjoyed voting rights"). The reason for such decisions is set forth by Mr. Justice BRANDEIS in his dissenting opinion in Olmstead v. United States, 277 U.S. 438, 485, 48 S.Ct. 564, 575, 72 L.Ed. 944 (1928):
Decency, security, and liberty alike demand that government officials shall be subjected to the same rules of conduct that are commands to the citizen. In a government of laws, existence of the government will be imperiled if it fails to observe the law scrupulously. Our government is the potent, the omnipresent teacher. For good or for ill, it teaches the whole people by its example. Crime is contagious. If the government becomes a lawbreaker, it breeds contempt for law; it invites every man to become a law unto himself; it invites anarchy. To declare that in the administration of the criminal law the end justifies the means to declare that the government may commit crimes in order to secure the conviction of a private criminal would bring terrible retribution. Against that pernicious doctrine this court should resolutely set its face.
It is therefore not sufficient simply to invoke Frisbie v. Collins, 342 U.S. 519, 72 S.Ct. 112, 96 L.Ed. 651 (1952), to defeat appellant's jurisdictional claim without fashioning a remedy for the Commonwealth's disregard of the procedure delineated by the Interstate Compact on Juveniles, 62 P.S. § 731. It is unrealistic to assume that appellant will assert a civil claim against the officers who took him from Ohio to Pennsylvania, or that they will be criminally prosecuted. See Scott, Criminal Jurisdiction of a State Over a Defendant Based Upon Presence Secured by Force or Fraud, 37 Minn.L.Rev. 91, 101-102 (1953). Furthermore, failure to fashion a remedy for official misconduct calls into question the continued constitutional vitality of the Frisbie rule. See Pitler, *189 "The Fruit of the Poisonous Tree" Revisited and Shepardized, 56 Calif.L.Rev. 579, 600 (1968).
Since the violation of the Interstate Compact is inextricably related to the very power of the Commonwealth to assert its jurisdiction over appellant, I do not think we make our insistence on compliance with the Compact adequately emphatic by confining appellant's relief to suppression of the statements he made while in transit from Ohio to Pennsylvania. Therefore, although I agree that appellant must be afforded a new delinquency hearing, I would direct the court below to order the Commonwealth to disclose its entire file to appellant, including all of the discovery sought by appellant's pre-trial motions. Cf. Coleman v. Burnett, 155 U.S.App.D.C. 302, 477 F.2d 1187, 1210-1212 (1973); United States v. Pollard, 335 F.Supp. 868 (D.D.C. 1971) (subsequent indictment does not bar affording preliminary hearing to defendant where official misconduct aborts preliminary hearing or renders it meaningless.)
NOTES
[1] Act of June 13, 1967, P.L. 31, No. 21, art. 7, § 731, 62 P.S. § 731.
[2] The pertinent part of the Compact is Article V, providing for interstate rendition of juveniles who have escaped from confinement or have absconded from probation or parole supervision. (Appellant was on probation at the time of the incident.) The basic procedure under the Compact is, briefly, as follows: the court seeking custody of the juvenile presents to the appropriate court of the state where the juvenile is located a requisition for his return, the court where the juvenile is located issues an order to any law enforcement officer or other appropriate person to arrest and detain the juvenile; that court then holds a hearing to determine that the requisition is in order before delivering the juvenile over to the person acting as agent for the demanding authority. Alternatively, a person may be taken into custody without a requisition upon reasonable information that he is an absconder or escapee within the terms of the Compact, but in that event he must be brought forthwith before a judge of the appropriate court who shall determine whether sufficient cause exists for his detention under a detention order issued on a requisition. Appellant could not have been returned to Pennsylvania under Art. XVII, 62 P.S. § 731 (Supp. 1975), concerning rendition of juvenile alleged to be delinquent, as Ohio has not adopted that provision. See In Re S.A., 60 Pa.D. & C.2d 55 (1973), and Ohio Rev. Code Ann. § 2151.56-61.
[3] Ohio Rev.Code Ann. § 2151.31(B) (Supp. 1975).
[4] Ohio Rev.Code Ann. § 2935.30 (1975).
[5] We are not utterly without precedent in applying the rule to what is, technically, not a criminal proceeding. See Commonwealth v. Kenney, 80 Pa.Super. 418 (1923).
[6] Although we will consider this assignment as challenging all the rulings differed with in the corresponding part of appellant's brief, we would much prefer that claimed errors be catalogued more specifically. We suggest to all counsel that saving the court the trouble of translating allegations of error from boilerplate will expedite any relief to which their clients are entitled.
[7] Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963) held that the prosecution's suppression of unfavorable evidence, if that evidence is material and is requested by the accused, violates due process. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582331/ | 31 So. 3d 791 (2010)
RIEDEL
v.
STATE.
No. 5D09-4284.
District Court of Appeal of Florida, Fifth District.
March 30, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399922/ | 455 S.W.2d 31 (1970)
Barbara Ann McCALLISTER, Plaintiff-Appellant,
v.
James Frederick McCALLISTER, Defendant-Respondent.
No. 33501.
St. Louis Court of Appeals, Missouri.
May 26, 1970.
*32 Richard R. Russell, Kirkwood, for plaintiff-appellant.
Hale W. Brown, A. L. Tidlund, Kirkwood, for defendant-respondent.
BRADY, Judge.
The divorce decree in question in this appeal awarded defendant a divorce upon his cross bill and granted him custody of the two children. The decree provided for plaintiff to have reasonable rights of visitation and the right of temporary custody every other weekend beginning at 10:00 A.M. Saturday and ending at 7:00 P.M. Sunday, together with three weeks during summer vacation. Plaintiff's appeal is limited to the custodial grant.
The facts bearing upon the issue of custody are somewhat hidden in this transcript; the divorce was the issue really tried. However, we can discern that these children came to the parties by adoption when they were infants. At date of trial in October, 1968 Kevin was approximately four years of age while Sharon was some twenty months. There is no real issue as to plaintiff's housekeeping or her general care of the children. While defendant testified she did neither to his satisfaction, it appears his opinion is subject to question as being without proper facts to support it. For example, that the house was thoroughly cleaned only about once a week; that the dishes were not kept washed through the day; that on one occasion he found Kevin playing outdoors on a cold day with his nose running and he put a sweater on the boy; that the children were not bathed when he came home from work; that "Half of the time they're kind of sickly and colds all the time when I pick them up"; and that during the summer months he sometimes had to go find "him" (obviously Kevin) to bring "him" home. On the other hand, he admitted he never complained to her about her housekeeping, and his witnesses stated the house was clean and the children well cared for so far as their physical requirements were concerned, and their relationship with plaintiff was good. As one of defendant's own witnesses put it, "She certainly kept them as clean as mine ever was, if not at times perhaps more so." Plaintiff's witness described plaintiff as an able and concerned mother.
There was evidence concerning plaintiff's control of and supervision over Kevin. Defendant's witnesses testified the parties lived within four houses of a very busy street which they considered dangerous for children and to which plaintiff had testified the children were not to go. One witness testified she saw Kevin on this street five or six times while the other had seen him on two or three occasions. There was also testimony Kevin is often out at about 7:00 in the morning in his pajamas either in his yard or on the street they lived on "wandering around", frequently with a bottle of soda pop. One witness testified she considered Kevin a neglected child on the basis that "* * * since he was two years old he's just been let run all day long." He also comes over in her yard and bothers her when she's gardening. Another of defendant's witnesses testified Kevin could have more supervision but seemed to be "all boy" with more "steam" than the other children. There was also testimony that when plaintiff was working until 11:30 at a hospital (following the separation) she would leave the children alone while taking the baby sitter home, a trip of some fifteen to twenty minutes duration.
Another matter that bears upon plaintiff's control and supervision of the children has to do with an occasion when Kevin *33 and Jim, a boy who had just moved into the neighborhood, walked eight or ten blocks. Plaintiff had seen the boys about 2:20 or 2:30 when she gave them each an apple and they went back out to play. About 3:00 o'clock Jim's mother came looking for him. They couldn't find him and Jim's mother, understandably concerned, called the police after a neighborhood search. There was testimony plaintiff was opposed to calling the police. About 4:30 Jim's father picked the boys up a couple of blocks from the house. Plaintiff testified she called defendant about 4:00 o'clock to tell him the boys were missing. His testimony was she called him at about 5:00.
Some of the testimony as to plaintiff's affair with a Bill Friedman is pertinent to the issue here involved. Plaintiff admitted she had sexual relations with this man after the separation from her husband. It further appears that she had told her husband she was in love with Friedman during the month prior to completion of the adoption of Sharon. Defendant also so testified. About ten days after the adoption was completed plaintiff and defendant separated. Defendant testified that he had been checking on plaintiff during their separation and he had seen this man's automobile parked near her house as many as twenty times during the period from April to October, and it often stayed there until 2:00 o'clock in the morning; that on these occasions there were no lights on in the house. One of defendant's witnesses testified to the same general effect except that she went to bed at 10:30 or 11:00 when the car was still there and does not know how much longer it stayed. Defendant's witnesses testified that as a result of this affair plaintiff's reputation in the neighborhood was not good. Defendant testified that Friedman is now divorced and that he saw Friedman's ex-wife and the Friedman children at plaintiff's residence. He has not seen Friedman there but that is the inference he draws from his testimony as to the presence of the automobile in front of plaintiff's residence.
The evidence as to the parties' respective abilities to care for the children financially and otherwise is very meager. Plaintiff's evidence was that at the time the divorce action was heard she was working in Clayton, Missouri, at a salary of $350.00 per month. She works from 8:20 in the morning to 5:00 in the evening. She would take the children to the baby sitter at 7:15 in the morning and pick them up at 5:30 in the evening at the baby sitter's home. The baby sitter is a licensed practical nurse who has a nursery set up in her home and keeps four or five other children in addition to Kevin and Sharon. The children get hot meals while they are being cared for. After 5:30 she calls for the children and they go to her home where she prepares dinner. Then they play and watch television until bedtime. Her testimony was that she paid $80.00 per month for this service by the nursery. There was no description given of her living quarters.
Defendant testified that a family by the name of Thompson who have three children of their own, two of which are school age and the other the same age as Sharon, would take care of Kevin and Sharon in the event the court awarded custody to him. He did not give the amount they would charge for their services or any particulars of their care. He works from 8:00 in the morning until 5:00 in the afternoon, and gets home about 5:30. On weekends he takes the children to his father's house but his father and stepmother can't care for the children as the stepmother works all day. He testified that he makes $150.00 per week plus car expenses which sum he did not state. Plaintiff testified that her husband's income in 1965 was $9,200.00, in 1966 it was $8,500.00, and in 1967 it was $7,000.00. The only expenses he gave were the payments on his car of $126.00 per month. There was no testimony as to the physical surroundings in the home in which defendant intended to place the children for day care nor any description of his present living quarters. The only evidence as to the father's character and his concern for the children and *34 their mutual love and affection was the testimony of his witness that he talked to Kevin, corrected him gently and firmly when Kevin needed it, and got along very well with him.
It will do little good to comment upon the parties' action in completing Sharon's adoption when both knew the home into which they were bringing her was then, to all effects and purposes, a broken home. Both parties bear the guilt of their unconscionable action in not bringing this fact to the attention of the court approving the adoption. It is obvious that circumstance would weigh heavily with the court in determining whether to grant the adoption.
We reverse this judgment because from this record we cannot tell whether the result reached was correct or incorrect. The facts upon which such a decision must be based were not sufficiently developed. Having in mind the ages of these children, and in the absence of special extraordinary reasons for not doing so, their interest would normally best be served by placing them with the plaintiff providing all other circumstances were equal. Stockton v. Guthary, Mo.App., 415 S.W.2d 308; Cadenhead v. Cadenhead, Mo.App., 265 S.W.2d 426. See cases collected Mo. Digest, Divorce, This is not a presumption of law but a recognized fact of life based on human experience. Garbee v. Tyree, Mo.App., 400 S.W.2d 193. Are there abnormal or unequal circumstances present in the instant appeal? If there are and if the welfare of the children demands it, the above cited rule will give way. Copenhaver v. Copenhaver, Mo.App., 402 S.W.2d 612.
First, there is the fact plaintiff must work all day and therefore cannot be present to give the children the guidance they need. But that is equally true of the father. Another is the plaintiff's feeling for and actions toward and with Friedman. But the fact that she has engaged in extra-marital activities does not of itself alone mean that she is not a fit parent. Townsend v. Townsend, Mo.App., 358 S. W.2d 271. Evidence of immorality disqualifying a parent as custodian of a child exists only when that parent's character and conduct are such that the child would probably be subjected to substantial immoral and debasing influences in the home. Stockton v. Guthary, supra. The evidence of Friedman's involvement with plaintiff and her affection for him are factors to be considered in determining her character and conduct, but in and of themselves alone they cannot be said to show such substantial immoral and debasing influences as to require denial of custody to plaintiff. There is no direct evidence going to that issue. The only evidence is the inference defendant draws from the fact Friedman was spending long and late hours at plaintiff's residence with the residence in darkness after the parties had separated. While defendant is entitled to draw certain inferences from Friedman's presence there under such circumstances, there was not even evidence the children were then in the house, although, again, that may be inferred from the circumstances. In any event, absent other evidence we cannot hold these visits establish the substantial immoral and debasing influences of which the cases speak. Neither do Kevin's escapades rise to the degree of showing plaintiff to be an unfit mother. Even defendant's evidence established he was a somewhat precocious child and that the children were well cared for.
It may be argued that our decision should be based upon the rule of deference to the trial court. While we are aware the trial court had the parties before it and perhaps was able to arrive at some judgment regarding their credibility and other similar matters from that fact and from their demeanor on the stand, we do not think that by that brief appearance some rational judgment as to their ability to take care of children and as to the sufficiency or fitness of the arrangement made for the children's care can be arrived at.
*35 The fault with all considerations above mentioned is that they beg the question by focusing attention solely upon the wisdom of denying plaintiff custody. If we allow ourselves to be so diverted we ignore equally pressing issues; i.e., the wisdom of placing the children with defendant or even with third parties. Yet it requires no citation of authority that custody is not a matter to be awarded upon the basis of fault between the parties as to the divorce or as an award for the behavior of one parent and a punishment for that of the other. It was not sufficient for the trial court to determine plaintiff should not have the custody of these children; it must also determine that defendant should have. It is in this respect this record is deficient. All this record discloses is that defendant has made arrangements with a family named Thompson to keep the children during the day while he works. Contrast that evidence, or the lack of any further development of the arrangements, with plaintiff's evidence as to the physical surroundings and care given the children in the nursery she provided for them. In addition, there is no evidence as to where or how the Thompsons intend to keep them (except that it is to occur in their residence) or as to their fitness to do so. In addition, it is clear defendant intends to take the children after work and keep them each evening until he goes to work again in the morning, but there is no evidence as to how or where or in what circumstances he will keep them during that time. There are many other factors which should be gone into before the custodial grant as to these children is properly arrived at. No one of those factors will be determinative but certainly a better picture of the total arrangements for the care of these children should be presented before the court can make a conscientious and rational judgment as to where the children should be placed. We think this is particularly true when we note that the children are adopted. We are well aware that the adoption having been completed the children are in all respects to be considered as the parties' natural children. Nevertheless, we think that in a realistic appraisal of the situation made in the light of the children's very tender years, a home broken before Sharon's adoption was completed, and with legal separation occurring closely (ten days) thereafter, the adoptive nature of the parental relation cannot help but be a factor in this case, at least as to Sharon. It is possible it may be equally pertinent as to Kevin.
Neither do we think the proper answer in this case is to affirm the judgment and hope the matter will be determined on a motion to modify. The effect of such a motion is to place a burden upon the movant to show change of conditions requiring modification and occurring since the custodial grant. One result of a proper grant of custody will be to determine who will bear that burden. Under the circumstances of this case it is hardly an answer to a grant awarded upon insufficient evidence to state that thereafter conditions may change. What must be determined is the wisdom of the custodial grant in the first instance.
Our reticence to reverse this judgment is overweighed by the heavy burden placed upon us to determine custodial grants purely and solely from the standpoint of what is best for the children involved. Upon retrial inquiry should not be limited to plaintiff's situation. Further development as to defendant's arrangements for care of these children is necessary if he is to receive the award. Nothing we have held herein is to be taken as requiring custody be placed in either parent or in third parties, nor should the result reached at first trial in any way circumscribe the issues. The custodial grant should be fully and completely developed de novo.
The judgment decreeing the divorce was not appealed from and has become final. Beckmann v. Beckmann, 358 Mo. 1029, 218 S.W.2d 566, 1.c. [12]570. The judgment as to the custody of these children is reversed *36 and the cause remanded to the trial court with directions to hold a hearing on that issue only.
WOLFE, P. J., and DOWD, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582307/ | 976 F. Supp. 341 (1997)
RESIDENTIAL REROOFERS LOCAL 30-B HEALTH AND WELFARE FUND OF PHILADELPHIA AND VICINITY, et al.
v.
A & B METAL AND ROOFING, INC.
Civil Action No. 96-CV-5063.
United States District Court, E.D. Pennsylvania.
August 28, 1997.
*342 Sanford G. Rosenthal, Jennifer B. Liebman, Sagot, Jennings & Sigmond, Philadelphia, PA, for Plaintiffs.
David C. Onorato, Landis, Kerns and Onorato, Lansdale, PA, for Defendant.
MEMORANDUM
JOYNER, District Judge.
INTRODUCTION
Before the Court is Plaintiffs' Motion for Partial Summary Judgment on the issue of Defendant's liability for contributions to benefit funds. For the following reasons, summary judgment is granted.
BACKGROUND
Defendant A & B Metal and Roofing, Inc. ("A & B") is a roofing contractor. A & B's 1990 incorporation documents identify Gary Bentz as Vice-President, Secretary, and Treasurer of the company and Robert Andalis as President. Plaintiffs are Residential Reroofers Local 30-B (the "Union"), a labor union, and various multi-employer benefit funds (the "Funds"). This action concerning Defendant's liability for contributions to plaintiff Funds pursuant to a collective bargaining agreement ("CBA") which Defendant allegedly entered into with the Union.
On December 17, 1991, Eileen Nicastro signed a CBA under the signatory heading "contractor" which included A & B's name, address, and phone number. David McBride, a Union representative, signed the CBA for the Union.
The CBA provides for employer contributions to the Funds for time worked by or paid to qualifying employees. The CBA also requires that these contributions be submitted to the Funds no later than the fifteenth day following the month in which the work is performed. The CBA contains an "Evergreen Clause" such that it is automatically *343 renewed every year unless terminated by one of the parties. The termination procedure requires written notice to the other party before September 30th, in which case the CBA would terminate on November 30th of that year. Remittance reports show that Defendant made contributions to the Funds regularly from February 1991 to June 1992 and from October 1993 to March 1994.[1]
In July 1994, Gary Bentz became the president of A & B. Also in July 1994, the Union sent Bentz a renewal of the CBA with an assent page for his signature. Bentz never signed this renewal assent. Bentz also never wrote to the Union to terminate the CBA. In March 1996, Bentz sent a letter to the Funds, not to the Union, indicating his intent not to be bound to the CBA and not to pay contributions. His letter also stated, "In July 1994, Eileen Nicastro stepped down from being president of A & B," and that at that time he had become president. Pl.'s Memo in Supp. of Partial Summ. J. (Pl.'s Memo) Ex.3.
Plaintiffs commenced this action on July 16, 1996 to recover alleged delinquent contributions due the Funds. Plaintiffs move for partial summary judgment on the issue of Defendant's liability for benefit fund contributions.
DISCUSSION
I. Summary Judgment Standard
The court should grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986). Whether a genuine issue as to any material fact exists is determined by whether the evidence is such that the fact finder could find reasonably in favor of the non-moving party. See id. at 248, 106 S.Ct. at 2510. To survive summary judgment, the non-moving party must raise more than a scintilla of evidence. Williams v. Borough of West Chester, 891 F.2d 458, 460 (3d Cir.1989). Further, the non-moving party can not simply rely on the assertions in its answer but must, by affidavits or by the depositions and admissions on file, "make a showing sufficient to establish the existence of [every] element essential" to its case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S. Ct. 2548, 2552-53, 91 L. Ed. 2d 265 (1986). Summary judgment is a "useful procedure when there is no dispute about the critical facts and it serves to eliminate the expense and delay of unnecessary trials." Peterson v. Lehigh Valley Dist. Council, 676 F.2d 81, 83 (3d Cir.1982).
II. Defendant's Liability to the Funds
Plaintiffs move for partial summary judgment on two distinct grounds: (1) Defendant's course of conduct and signed writings referencing the CBA evidenced Defendant's intent to be bound to the terms of the CBA regarding benefit fund contributions such that it is liable for contributions even absent a valid, signed CBA; (2) A valid, signed CBA under which Defendant is liable for benefit fund contributions does exist since Eileen Nicastro had actual or apparent authority to sign the 1991 CBA on behalf of A & B.
In opposition to Plaintiffs' motion, Defendant claims that material issues of fact exist as to whether or not a signed, valid, enforceable CBA exists which would require benefit contributions. Defendant argues that Eileen Nicastro had no authority, actual or apparent, to sign the CBA on behalf of A & B and that the CBA is therefore invalid. Alternatively, Defendant argues that it terminated any valid CBA that may have existed when Bentz did not sign the renewal assent form or, at the latest, when Bentz wrote the Funds in March 1996.
For purposes of clarity, we will address Plaintiffs' course of conduct argument first even though we rest our decision to grant partial summary judgment upon Plaintiffs' claim regarding Eileen Nicastro's authority.
*344 A. Defendant's Liability Under a Course of Conduct Theory
Plaintiffs argue that, as a matter of law, a signed CBA is not necessary for the Court to find Defendant liable for contributions to the funds. However, Plaintiffs' argument is not persuasive, and we do not find that partial summary judgment should be awarded on this basis.
Section 302(c)(5)(B) of the National Labor Relations Act ("NLRA"), 29 U.S.C. § 186(c)(5)(B), permits an employer to contribute to employee benefit plans provided that "a detailed basis on which payments are to be made is specified in a written agreement with the employer...." The "written agreement" requirement is met where (1) "there is a writing that clearly refers to the collective bargaining agreements" and (2) "the conduct of the defendants in paying past contributions and liquidated damages evidences an intent to be bound by the collective bargaining agreements despite a lack of written consent." Central Pa. Teamsters Pension Fund v. Frey's Motor Express, Inc., No. CIV.A.93-2442, 1994 WL 2533, at *2 (E.D.Pa. 1994) (quoting Trustees of Washington Area Carpenters' Pension & Retirement Fund v. Mergentime Corp., 743 F. Supp. 422, 427 (D.Md.1990)). Plaintiffs claim that the "written agreement" requirement of § 302(c)(5)(B) does not require a signed CBA.
While courts have found employers liable for benefit contributions absent a signed CBA according to this "course of conduct" theory, the writings referencing the CBA or the benefit agreements in such cases provided stronger proof of the employers' intent than does the evidence here. For example, in some cases a signed but expired CBA existed which the employers' conduct continued to follow. See, e.g., Robbins v. Lynch, 836 F.2d 330 (7th Cir.1988) (finding employer liable for contributions where signed, expired CBA existed and signed promises to be bound by multi-employer association agreements existed); Composition Roofers Union Local No. 30 Welfare Trust Fund v. L.A. Kennedy, Inc., No. CIV.A.93-1558, 1996 WL 220975 (E.D.Pa. May 2, 1996) (finding employer liable for contributions where writings included signed, expired CBA). Absent a prior or expired CBA, courts have applied the "course of conduct" theory where there existed other specific promises, assents, agreements, memorandums or agreement or similar formal writings referencing the CBA or benefit agreements. See, e.g., Central States, Southeast and Southwest Areas Pension Fund v. Behnke, Inc., 883 F.2d 454 (6th Cir.1989) (finding employer liable for contributions where employer had signed certification of CBA). In our case, no prior valid CBA or other signed agreement, letter, promise, or assent exists.
Defendant's check and contributions do create a course of conduct suggesting intent to comply with the terms of the CBA, but the only "writings" referencing the CBA are the remittance reports initially signed by Eileen Nicastro, whom Bentz claims had no authority. See Bentz Decl. ¶ 5. The remittance reports do reference the terms of the CBA as to the Funds, but (assuming Eileen Nicastro had no actual or apparent authority to sign the reports for A & B) they are not signed by an officer of the Defendant. Also, unlike the writings in the cited cases, the remittance reports do not specifically assent to, agree with, or promise to uphold the CBA.
Plaintiff points us to Trustees of Flint Mich. Laborers' Pension v. In-Puls Constr. Co., 835 F. Supp. 972 (E.D.Mich.1993), in which the court applied the "course of conduct" theory and found an employer liable for contributions where no prior CBA or other signed agreements, assents, or promises existed. The writings in In-Puls consisted of payroll reports signed by the employer's president, remittance reports signed by an authorized agent, and a CBA on which the employer had written the company name but had not signed. See id. at 973. Unlike our case, in which the only writings are the check and the remittance reports, the remittance reports in In-Puls contained the following statement: "By filing this form the undersigned agrees to the terms of payment as set forth in the current Collective Bargaining Agreement and Trust Agreement..." Id. Also, the payroll reports in In-Puls "plainly refer[red] to contributions to the fringe benefit fund." Id. In our case, *345 no such specific language exists on the remittance reports, and Plaintiffs have not identified payroll reports referencing the CBA. Finally, assuming Eileen Nicastro lacked authority to act on behalf on A & B, the writings were not signed by an authorized agent or officer. Thus, we do not agree with Plaintiffs that Defendant's course of conduct and signed writings establish liability for contributions to the Funds.
B. Eileen Nicastro's Authority and the Validity of the CBA
Plaintiffs argue that the CBA between the Union and Defendant is valid and enforceable as a result of Eileen Nicastro's actual or apparent authority. Moreover, an agent's authority can be ratified by the acts of her principal. See IRS v. Gaster, 42 F.3d 787, 793 (3d Cir.1994). See also Restatement (Second) of Agency § 100 cmt. a (1958) ("The affirmance of the act of an unauthorized person by the purported principal...has the same effect as if such person had been originally authorized.") Though we find summary judgment inappropriate under an actual authority theory, we find that Ms. Nicastro did have apparent authority and that Defendant ratified Ms. Nicastro's actions such that Defendant became bound by the terms of the CBA.
Under Pennsylvania law, "an agent can bind his principal if the agent has actual or apparent authority." Richardson v. John F. Kennedy Mem'l Hosp., 838 F. Supp. 979, 985 (E.D.Pa.1993) (citing Volunteer Fire Co. v. Hilltop Oil Co., 412 Pa.Super. 140, 602 A.2d 1348, 1351-52 (1992)). Actual authority is "the authority expressly granted to an agent by his principal." Id. In this case, Ms. Nicastro signed the CBA on behalf of A & B Metal on June 17, 1991 and also signed a check from A & B for $1,000 to be deposited in the Funds' escrow account. Plaintiffs claim that at the time of the signing, Gary Bentz requested that Ms. Nicastro sign the CBA. Pl.'s Reply to Def.'s Memo in Opp'n to Partial Summ. J. at 4 ("Pl.,'s Reply"); Nicastro Decl. ¶ 2; McBride Dep. at 10. However, Defendant claims that Eileen Nicastro was never authorized to sign the CBA on behalf of A & B, and Gary Bentz specifically denies ever having authorized Ms. Nicastro to do so. Def.'s Memo in Opp'n to Partial Summ. J. at 2 (Def.s Memo); Bentz Decl. ¶ 5. There are, therefore, disputed factual issues precluding partial summary judgment on these grounds.
Plaintiffs argue in the alternative that the CBA is valid and enforceable under the doctrine of apparent authority. "Apparent authority exists where the principal, by words or conduct, leads people with whom the alleged agent deals to believe that the principal has granted the agent the authority he purports to exercise." Id. (emphasis added) This court in Constitution Bank v. DiMarco, 836 F. Supp. 304, 307 (E.D.Pa.1993), aff'd mem., 27 F.3d 556 (3d Cir.1994), discussing apparent authority, noted that "the intent to be bound to a third party flows from the principal's conduct and not from that of the agent." See also AT & T Co. v. Winback and Conserve Program, Inc., 42 F.3d 1421, 1439-40 (3d Cir.1994) (noting that doctrine of apparent authority is applicable to both agents and non-agents who are reasonably believed by third parties to have agency relationship with principal). Furthermore, "without actual knowledge of the agent's authority to bind the principal, the third party must exercise only reasonable diligence to ascertain the agent's authority." Id. (citing Bolus v. United Penn Bank, 363 Pa.Super. 247, 525 A.2d 1215, 1222 (1987)).
Here, Plaintiffs claim that Ms. Nicastro acted with apparent authority where, in the presence of Gary Bentz, she (1) signed the CBA under the signatory heading "contractor" which listed the contractor as "A & B Metal and Roofing" and (2) signed the A & B check for $1,000. Pl.'s Reply at 7; Nicastro Decl. ¶ 4; McBride Dep. at 9. Plaintiffs allege that the Union therefore believed that Bentz, then vice-president, secretary, and treasurer of A & B, approved of Ms. Nicastro's signing. While Bentz denies that he ever authorized Ms. Nicastro to sign on behalf of A & B, Bentz does not deny attending the signing, and Defendant provides no evidence that Bentz was not present at the signing. In fact, Defendant does not address this aspect of Plaintiffs' claim. Defendant's only contention regarding Ms. Nicastro's apparent authority is that she could not have *346 acted under apparent authority since the CBA did not indicate that she signed as an officer of the Defendant. Def's Memo at 2. Defendant cites no decision of any court which defines apparent authority in this way. Further, this contention conflicts with the Pennsylvania and Third Circuit cases cited above that clearly define apparent authority as based upon the words, conduct or representations of the principal.
Even if Bentz were not at the signing (an issue not disputed by the Defendant), Defendant's actions after Ms. Nicastro signed the CBA ratified her authority such that Defendant became bound to the agreement. "Consent sufficient to establish an agency relationship exists not only where there is prior authorization, but also where a principal ratifies acts done on her behalf after the fact." Gaster, 42 F.3d at 793. Furthermore, the concept of ratification in agency law binds a principal to an unauthorized agent's acts if the principal knows of the acts but fails to take affirmative steps to disavow them. See United States v. One 1973 Rolls Royce, 43 F.3d 794, 818 n. 26 (3d Cir.1994).
A & B not only failed to repudiate Ms. Nicastro's signing of the CBA, but also took affirmative steps which ratified her signing the CBA. A & B failed to cancel the check for $1,000 signed by Ms. Nicastro and made out to the Funds' escrow account, and A & B made contributions to the Funds according to the specific provisions of the CBA totaling well over $1,000. Additionally, A & B submitted reports to the Funds according to the provisions of the CBA. These reports were signed "Eileen Nicastro, Pres." for the four months following the signing of the CBA and "Eileen Nicastro" for forty-three more months.
In SEI Corp. v. Norton & Co., 631 F. Supp. 497 (E.D.Pa.1986), the court found that a similar failure to repudiate an unauthorized action amounted to ratification of the action. In SEI Corp., the defendant's authorized attorney discovered, well before trial, that an unauthorized attorney had accepted service of the complaint and filed an answer for the defendant. Id. at 501-02. When the defendant's authorized attorney waited until three days into the trial to repudiate the unauthorized attorney's representations, the court found that his failure to notify the court and the plaintiff of the unauthorized attorney's representations amounted to ratification of the representations. Id. at 502-03.
In the present case, Defendant did nothing to repudiate Ms. Nicastro's signing the CBA. Defendant allowed the $1,000 check to clear, made contributions to the fund according to the CBA, and submitted remittance reports according to the CBA. In fact, Defendant's first act in repudiating the validity of the 1991 CBA did not come until March 1996 when Bentz wrote, not to the Union, but to the Funds. Even this letter, though, did not repudiate the validity of the CBA or Ms. Nicastro's authority, but rather stated A & B' intention not to be "union" anymore. Pl.'s Memo Ex. 3. Indeed, this letter explicitly referred to Ms. Nicastro as the former president of A & B, further ratifying her signing the CBA by suggesting that she was president at one time.[2]
The Union and the Funds, therefore, reasonably believed that the CBA signed by Ms. Nicastro was a valid and enforceable agreement, while A & B's failure to repudiate Ms. Nicastro's signing the CBA and A & B's actions in accordance with the terms of the CBA ratified Ms. Nicastro's authority. No reasonable finder of fact could find otherwise. Thus, having failed to meet its burden of establishing that a material issue of fact exists, see Celotex, 477 U.S. at 323, 106 S.Ct. at 2552-53, Defendant's opposition to partial summary judgment on the basis of Ms. Nicastro's apparent or ratified authority fails.
C. Defendant's Termination of the CBA
Defendant contends that even if the CBA is valid and enforceable, it was terminated *347 by Bentz's failure to sign the renewal assent in 1994, or, in the alternative, by Bentz's March 1996 letter to the Funds. We find Defendant's argument to be without merit for two reasons. First, Bentz's actions did not constitute termination of the CBA according to its explicit terms. Second, the Third Circuit only recognizes three distinct defenses to actions by benefit funds for employer contributions, and contract termination is not among them. See Agathos v. Starlite Motel, 977 F.2d 1500, 1505 (3d Cir. 1992).
1. Defendant's Attempted Termination of the CBA
Defendant failed to terminate the CBA. The CBA contained an "Evergreen Clause" which stated that renewal was automatic barring "written notice duly given to the other party..." CBA at 44. Defendant cites no case law to suggest that Bentz's failure to sign the renewal assent form constitutes proper termination merely because Bentz intended so. Furthermore, Bentz sent the March 1994 letter to the Funds, not the Union, even though the CBA required written notice to the other "party." The Funds were not a party to the CBA. See generally Lewis v. Benedict Coal Corp., 361 U.S. 459, 80 S. Ct. 489, 4 L. Ed. 2d 442 (1960) (holding that absent specific language to the contrary, benefit funds are separate from union signatories to CBA's and that employers' obligations to funds are separate from obligations to unions under CBA's).
Courts consistently conclude that contracts with "Evergreen Clauses" requiring written notice are not terminated absent compliance with the terms of the contract. See, e.g., Local 257, Int'l Bhd. of Elec. Workers v. Grimm, 786 F.2d 342, 345-46 (8th Cir.1986) (holding that noncompliance with terms of agreement did not terminate agreement, failure to comply with date requirement in termination procedure rendered termination ineffective, and letter between non-party and party could not terminate agreement); Central States, Southeast, and Southwest Areas Pension Fund v. Gerber Truck Service, Inc., 854 F.2d 1074, 1079-80 (7th Cir.1988) (holding that oral termination was invalid where CBA called for written termination and that termination was effected only when written notice was given to the funds and the union according to the specific date requirements of the CBA); In re Baldanza Bakery, Inc., 149 B.R. 370, 371 (Bankr.D.N.J.1992) (stating that CBA which included "Evergreen Clause" and required written notice to terminate did not terminate absent such written notice). Having failed to comply with the explicit requirements set forth in the CBA, Defendant's efforts to terminate the agreement were ineffective.
2. Alleging Contract Termination as a Defense
The Funds in this case are third-party beneficiaries to the CBA between the Union and A & B, and Section 515 of ERISA, 29 U.S.C. § 1145 (1988), limits the defenses available to a defendant employer against third-party beneficiary benefit funds seeking contributions. See Agathos, 977 F.2d at 1505. The Third Circuit recognizes only three defenses that an employer may assert against employee benefit funds seeking contributions: (1) The fund contributions themselves are illegal; (2) The collective bargaining agreement is void ab initio; (3) The employees have decertified the union as its bargaining representative. See id.[3]
Here, Defendant does not maintain that the contributions are illegal or that its employees have decertified the union. Defendant instead based its defense upon an alleged contract termination. The defense of termination, though, is one of voidability of the contract, not that the contract is void ab initio. See id. Although Defendant does not address this issue of limited defenses, it *348 is instructive to examine the differences between a contract's being void ab initio, "such as where there is fraud in the execution of the agreement" and a contract's being voidable, "as in the case of fraudulent inducement." Id. While the former is a valid defense in a case such as this, the latter is not. See id. Fraud in the execution arises when a party enters an agreement "with neither knowledge nor reasonable opportunity to obtain knowledge of its character or its essential terms." Connors v. Fawn Mining Corp., 30 F.3d 483, 490 (3d Cir.1994). In our case no such situation exists; in fact, Defendant's claim here is that it terminated any valid agreement that may have existed. Clearly, Defendant is not claiming a defense of fraud in the execution of the contract where it claims that it terminated the CBA. Third Circuit law prevents Defendant from claiming termination of the contract in the alternative to its failed claim that Eileen Nicastro lacked authority to sign the CBA. See also Carpenters Health & Welfare Trust v. Bla-Delco Constr., Inc., 8 F.3d 1365, 1369 (9th Cir.1993) (holding that contract termination is defense that contract is voidable, not void, and that such defense is not available against third-party beneficiary benefit fund under § 515 of ERISA). Defendant, therefore, may not allege termination of the CBA as a defense in this action.
CONCLUSION
For the foregoing reasons, the Court grants Plaintiffs' Motion for Partial Summary Judgment as to the issue of Defendant's liability for benefit fund contributions.
NOTES
[1] Defendant submitted remittance reports for every month from February 1991 to January 1996. However, many of these reports show zero dollars contributed.
[2] However, Bentz claims in his deposition that he only wrote that Eileen Nicastro stepped down from being president because of what the Funds' manager told him, repudiating the suggestion that Ms. Nicastro was ever president. Bentz Dep. at 103. Bentz's deposition, though, also contains statements suggesting that Ms. Nicastro was the president. See Bentz Dep. at 102. Nonetheless, Bentz's letter suggesting that Ms. Nicastro had stepped down from being president acts to ratify her authority regardless of whether she was ever president.
[3] Section 515 is designed to effectuate employer contributions to multi-employer benefit funds. See Agathos, 977 F.2d at 1505. When Congress enacted Section 515 in 1980, it intended to reduce the cost to funds of employer delinquency by allowing funds to avoid the difficult and costly legal recourse then necessary to recover contributions. See id.; 126 Cong. Rec. 23039 (1980) (remarks of Rep. Thompson). Pursuant to these goals, "[c]ourts of appeals have interpreted § 515 as precluding employers from raising a variety of contract defense as a means of avoiding the obligation to contribute to employee benefit plans." Agathos, 977 F.2d at 1505. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582336/ | 110 Wis. 2d 469 (1983)
329 N.W.2d 150
John E. BANKERT, a minor, by his guardian ad litem, Robert L. Habush, Plaintiff-Appellant-Petitioner,
Rosa BANKERT and Ervin Bankert, Plaintiffs,
v.
THRESHERMEN'S MUTUAL INS. CO., and Watertown Mutual Insurance Company, Defendants-Respondents,
The OHIO CASUALTY INS. CO., Richard D. Mueller, Arnold J. Mueller, Margie Mueller, State Farm Mutual Automobile Insurance Co., Steven J. Johnston, Michael Johnston, Karen Johnston, and Mutual Life Insurance Co. of New York, Defendants.
No. 80-2058.
Supreme Court of Wisconsin.
Argued November 1, 1982.
Decided February 3, 1983.
*471 For the plaintiff-petitioner there were briefs by Howard A. Davis, Patrick O. Dunphy and Habush, Habush & Davis, S.C., Milwaukee, and oral argument by Mr. Dunphy.
For the defendants-respondents there was a brief by Thomas R. Schrimpf and Kluwin, Dunphy, Hankin & McNulty, Milwaukee, and oral argument by Mr. Schrimpf.
Affirming 105 Wis. 2d 438, 313 N.W.2d 854 (Ct App).
HEFFERNAN, J.
This is a review of a decision of the court of appeals which reversed an order of the circuit court dismissing a motion for summary judgment.[1]
[1]
The court of appeals held that, where the language of a farmowners policy provided that the coverage did not apply "to the ownership, operation, maintenance or use . . . of (1) automobiles while away from the premises or the ways immediately adjoining" (p. 441), there was no coverage for an accident on a public highway even though the plaintiff alleged that the parents' negligent entrustment of the vehicle or negligent supervision of the minor *472 driver occurred on the farm premises and not at the situs of the accident. We agree with the court of appeals and affirm its decision that the farmowners policy does not afford any coverage where the underlying "occurrence" the automobile accident took place away from the premises.
The facts which must be accepted at this stage of the proceedings are set forth in the complaint. On September 22, 1978, Richard D. Mueller, aged fifteen, was driving an unlicensed motorcycle, without functioning lights, when it crashed into a car illegally parked on the streets of Watertown. His passenger, John E. Bankert, also a fifteen-year-old, was injured.
The plaintiffs, John Bankert and his parents, sued Richard Mueller and his parents, Arnold Mueller and Margie Mueller. Plaintiffs claim that both Mueller parents are liable because they "negligently entrusted" the motorcycle to Richard and because they "negligently supervised" him on the night of the accident.
The plaintiffs claim that Threshermen's Mutual Insurance Company[2] (hereinafter Threshermen's or the company) was liable under a farmowners policy issued to the Muellers. Threshermen's has responded by asserting that, under its policy, no coverage is afforded even if the accident occurred exactly as alleged by the plaintiffs and even if the parents were negligent in the respects alleged.
Threshermen's moved for summary judgment, asking that it be dismissed because its policy did not afford coverage. In an order entered by the trial court, the motion of the company was denied. The trial court found that, although no coverage was afforded on the cause of action *473 for negligent entrustment, coverage was afforded on the cause of action for negligent supervision.
The Bankerts appealed from the portion of the trial court order holding there was no coverage for the negligent-entrustment action and the company cross-appealed from the portion of the order holding that coverage was afforded on the alleged negligence in respect to supervision.
The court of appeals concluded that the farmowners policy afforded no coverage under either alleged cause of action. The effect of its decision was to grant summary judgment dismissing Threshermen's and to reverse the trial court order. It improperly denominated its decision as one which "modified and, as modified, affirmed." We affirm the court of appeals decision reversing the order of the trial court.
We are not in this opinion concerned with the merits of plaintiffs' claim on either theory. We treat only the question of coverage under Threshermen's farmowners policy. For the purpose of determining the coverage question, we assume, although we do not decide, that the facts are sufficient to state a claim under both theories: Negligent entrustment of the motorcycle to Richard and failure to exercise proper control over Richard shortly before the accident. We conclude that in neither instance, although liability be found against Richard's parents, does the Threshermen's policy afford coverage.
In order to reach that conclusion, we must first consider the nature of the claim for "negligent entrustment" and the claim of "negligent parental control."
[2]
The common law does not make parents routinely liable for damages caused by their children. Prosser, Law of Torts (4th ed. 1971), sec. 123; 59 Am. Jur. 2d, Parent and Child (1971), sec. 130. However, in some circumstances parents would be held liable. Four general situations *474 resulting in parental liability have been recognized at common law: (1) Where the parent negligently entrusts the child with an instrumentality which may become a source of danger to others; (2) where the child is acting as the parent's agent; (3) where the parent knows of the child's wrongdoing and consents to it, or directs or sanctions it; and (4) where the parent fails to exercise control over the child, although the parent knows, or should know, that injury to another is a probable consequence. See, Comment, Parental Liability for a Child's Tortious Acts, 81 Dickinson Law Rev. 755, 759 n. 25 (1977). The commentators indicate that parental liability is based on ordinary rules of negligence, not the parent-child relationship.
Only two of these common-law types of possible liability are relevant here negligence entrustment and negligent failure to exercise control.
Hopkins v. Droppers, 184 Wis. 400, 198 N.W. 738 (1924), and 191 Wis. 334, 210 N.W. 684 (1926), appears to be the first Wisconsin negligent-entrustment case. Hopkins involved a fifteen-year-old child for whom his father purchased a motorcycle. On the first appeal of that case to the Wisconsin Supreme Court, it was assumed that, under the pleadings, young Droppers had used the motorcycle with the express consent and approval of his father.
This court recognized the general rule that no liability arises at common law by virtue of the parental relationship alone. It pointed out that some participation by the parent in respect to a tort of a minor child was an essential predicate for parental liability. It held, however applying the general rule that an owner may be liable for his own negligence in entrusting an instrumentality to a person that he knows will be incompetent or incapable of managing it that a parent could be liable for negligently entrusting an automobile or motor-cycle *475 to a minor child. Accordingly, this court affirmed the trial court's order holding that a cause of action for negligent entrustment had been stated.
At the trial following remand, the jury found that the father had failed to exercise ordinary care to prevent his son from operating the motorcycle. That verdict was reversed by this court, because there was no evidence to show that the child was habitually disobedient of his parents and that the father had twice just prior to the use resulting in an accident told the child not to operate the cycle unless accompanied by an adult. After reviewing the evidence relied upon to support the jury verdict and finding it insufficient, the court ruled as a matter of law that the father did not violate his duty to supervise his son and, accordingly, did not commit any act of negligence.
It is noteworthy that what in the first Hopkins v. Droppers case was referred to as "negligent entrustment" in the second case resolved itself into a problem of whether the parent was negligent in the "supervision" or control of a minor child. The two cases are instructive of the fact that the theories merge almost imperceptibly, depending on a court's interpretation of the facts. Hence, the Hopkins v. Droppers duo exemplifies this court's acceptance of both negligent entrustment and negligent control in finding a parent a joint tortfeasor when the parent's act is in conjunction with a negligent act by a minor.[3]
[3]
It is apparent, then, that in Wisconsin parental liability, at common law, never arises from the familial relationship alone; but in respect to the problem pertinent to this case, liability can arise when any person *476 (whether parent or not) who has a vehicle under his control permits another to use the vehicle if he knows, or should know, that the other is unable to manage the vehicle and, therefore, injury to others is likely to result.
Restatement (Second), Torts 2d, sec. 308, p. 100 (1965), states the rule in general terms:
"Sec. 308. Permitting Improper Persons to Use Things or Engage in Activities
"It is negligence to permit a third person to use a thing or to engage in an activity which is under the control of the actor, if the actor knows or should know that such person intends or is likely to use the thing or to conduct himself in the activity in such a manner as to create an unreasonable risk of harm to others."
[4]
Analysis of Wisconsin authority and the rule of the Restatement illustrates that the negligence of the entruster is a separate act of negligence. It is also apparent, however, that such negligent entrustment is irrelevant unless the person to whom a thing is entrusted acts in a negligent manner (creates an unreasonable risk) and in fact inflicts injury as the result of such conduct. For liability to ensue, the negligence of the entruster and the entrustee must result in the injury.
This was the express position taken by this court in the first Hopkins case when it quoted with approval Berry on Automobiles (3rd ed.), sec. 1040, p. 410:
"`In such a case of mere permissive use, the liability of the owner would rest . . . upon the combined negligence of the owner and the driver; negligence of the owner in intrusting the machine to an incompetent driver, and of the driver in its operation.'"
Hence, it is the negligent use and operation of the vehicle by the entrustee which makes the negligent entrustment relevant at all. Negligent entrustment is part *477 of the tort of negligent use and operation of the entrusted automobile.
The second theory upon which plaintiffs rely is one they denominate as "negligent supervision." This term has never been used by this court; and, consistent with our adoption of Restatement, Torts 2d, sec. 316 in Seibert v. Morris, 252 Wis. 460, 32 N.W.2d 239 (1948), we conclude the tort is more appropriately referred to as one of "failure to control."
In Seibert, p. 463, we adopted sec. 316:
"Sec. 316. Duty of Parent to Control Conduct of Child
"A parent is under a duty to exercise reasonable care so to control his minor child as to prevent it from intentionally harming others or from so conducting itself as to create an unreasonable risk of bodily harm to them, if the parent
"(a) knows or has reason to know that he has the ability to control his child, and
"(b) knows or should know of the necessity and opportunity for exercising such control."
[5]
The tort of negligent control has been considered by this court in Seibert, supra; Pawlak v. Mayer, 266 Wis. 55, 62 N.W.2d 572 (1954); and Gerlat v. Christianson, 13 Wis. 2d 31, 108 N.W.2d 194 (1961). In these cases, as in the negligent-entrustment cases, the parent who has failed to exercise proper control is treated as a joint tortfeasor, whose separate act of negligence, for the imposition of liability, only becomes relevant upon the negligent act and injury by the child, who should have been subject to proper control.
[6]
The tort differs from that of negligent entrustment, however. Although both the tort of negligent entrustment and of failure to control a child generally involve children improperly using an instrumentality which can *478 be dangerous, entrustment requires that the instrumentality be "entrusted" to the entrustee. Negligent control may be the failure to exercise ordinary care in allowing the instrumentality to be in the hands of a child, or it may be a failure in other respects, e.g., failure to properly instruct in use or a failure to warn of hazards.
In either negligent entrustment or negligence in respect to proper control of a child, a parent's (or entruster's) negligence is a separate act of negligence, but that negligence is nonactionable in the absence of a wrongful or negligent act of the child or entrustee. It is the act of the child or entrustee which is the cause in fact of the injury or "occurrence."[4]
The Wisconsin cases illustrate that the two theories alleged by the plaintiffs herein are devices for making one other than the person who actually inflicted the harm responsible for at least a part of the damages. There can, however, be no liability or responsibility in the absence of the underlying tort in the instant case, the negligent operation of the motorcycle by Richard Mueller and the injury of the plaintiff-passenger, John Bankert.
The insurance policy issued by Threshermen's does not insure against theories of liability. It insures against "occurrences" which cause injuries.
Coverage A of the insuring agreement provides:
"The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury or property damage to which this insurance applies, caused by an occurrence. . . ." (Emphasis supplied.)
An "occurrence" is defined in the policy as:
*479 "[A]n accident, including injurious exposure to conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured."
Because the Muellers are named insureds under the policy, in the absence of exclusions they would be covered for the damages incurred by the accidental injury to the Bankert boy. The policy provides, however:
"This policy does not apply. . . .
"(b) under any of the coverages, to the ownership, operation, maintenance or use, including loading and unloading of
"(1) automobiles while away from the premises or the ways immediately adjoining."
It is undisputed that the motorcycle is an "automobile" for the purpose of the exclusion.
The plaintiffs agree that the negligent act of Richard, who was driving the car, is excluded from coverage, but argue that, in respect to the negligence of Richard Mueller's parents, this exclusion is inapplicable, because their negligence did not take place "away from the premises," but rather that the negligent entrustment or the negligent failure to control took place on the farm premises.
According to the plaintiffs, it is not the place of the accident that controls, but rather the place of the negligent act. It is immediately apparent that this contention, if approved, would result in a strange and strained construction of the policy in numerous circumstances, e.g., in the case of negligently maintained tires which cause an accident or where brakes have been neglected. These acts of negligence could hardly have occurred at the situs of the accident. In part, the negligence would have occurred where the vehicle was garaged the farm premises. Under this argument, irrespective of where the accident occurred, all negligence which was attributable to conduct at the farm home would be covered. Acceptance *480 of this theory would convert the farmowners liability policy into an automobile policy.
However, we need not speculate as to what was intended by the company when it issued the policy or by the insured when he acquired it. As pointed out above, the company becomes legally liable to pay only when the insured incurs liability for personal injury or property damage caused by an "occurrence." An occurrence is defined as an accident. This is what is insured against not theories of liability. Accordingly, when the event insured against involves an automobile and happens away from the premises, the exclusion applies. There is no coverage.
The trial court and the court of appeals both indulged in what we consider to be superfluous rationales in order to conclude that the negligent acts alleged to be committed by Richard's parents were excluded in respect to "ownership, operation, maintenance or use, including loading and unloading" of the automobile. The court of appeals concluded that both alleged causes or theories of action were directly related to "ownership," "operation," "maintenance," and "use." While we cannot quarrel with this analysis, because it seems clearly correct, it also seems redundant. It would appear that the exclusions appear to run the entire gamut of possible coverage. Hence, a reasonable, plain reading of the exclusions leads to the conclusion that all automobile coverages are excluded when the occurrence, or the event insured against, happens away from the premises.
The court of appeals correctly reasoned that entrusting the motorcycle to Richard was either an exercise of "ownership" or of "use." We also agree with the court of appeals' analysis in respect to "negligent supervision" or, alternatively stated, "failure to control." This conduct by Richard's parents relates directly to the manner of operation of the vehicle, i.e., its negligent use. There appears to be no reasonable doubt that the two areas or *481 theories of liability on which the plaintiffs rely are intimately connected with the very types of coverages which are expressly excluded.
While we do not accept the proposition that whatever is covered in the standard automobile liability policy is ipso facto excluded from the farmowners policy by the provisions incorporated in the Muellers' policy, it is difficult to envision liability coverage greater than that excluded by sec. II. We think that the effect of the exclusion is to unambiguously exclude all coverage for liability for an automobile accident when the occurrence the event insured against takes place away from the premises.
It is "occurrences" that are insured against, not negligent acts. Here the occurrence was unequivocably "away from the premises."
The Connecticut Supreme Court in LaBonte v. Federal Mutual Ins. Co., 159 Conn. 252, 268 A.2d 663 (1970), construed a homeowners policy with exclusion language almost identical to that in the instant case. It reached the heart of the issue by holding that the language "away from the premises" was plain and unambiguous. It said that the obvious purpose was to limit the territorial scope of coverage to the premises of the home.
"That clause provides, in effect, that any liability, under any theory of recovery, whether personal negligence, master-servant, agency, or other theory of vicarious liability, which arises from an automobile accident off the premises, is outside the scope of the contract." P. 257.
It quoted with approval Service Welding & Machine Co. v. Michigan Mutual Liability Co., 311 Fed. 2d 612, 618 (6th Cir.), in respect to a similar policy:
"[A]t least as to automobiles, the creation of liability and the . . . injury . . . must all occur on the premises of . . . [the insured]." P. 257.
*482 In Barnstable County Mut. Fire Ins. Co. v. Lally, 374 Mass. 602, 373 N.E.2d 966 (1978), the Supreme Judicial Court of Massachusetts held, where a homeowners policy excluded coverage in the event of bodily injury arising out of the ownership, operation, or use of a vehicle if the injury occurs away from the residence premises, an action brought on the theory of negligent entrustment did not circumvent the exclusion, that negligent entrustment is derived from the general concepts of ownership, operation, and use of the vehicle. Moreover, it held that the meaning of the exclusion was plain it excluded coverage for bodily injuries from automobile accidents happening away from the premises; and, hence, the exclusion applied although there was a negligent entrustment.
The Washington Court of Appeals, in interpreting a similar exclusion, said:
"It is the place where the accident occurs, and not the place where the negligent commission or omission occurs, which controls the insurer's liability under such exclusionary language. . . ." St. Paul Fire and Marine Ins. Co. v. Circle Bar J Boys' Ranch, Inc., 1 Wash. App. 377, 379-80, 461 P.2d 567 (1969).
See also, Fidelity & Guaranty Ins. Underwriters, Inc. v. McManus, 633 S.W.2d 787 (Tex. 1982), and Cooter v. State Farm Fire and Casualty Co., 344 So. 2d 496 (Ala. 1977), both of which emphasized that, for liability, there must be negligent use by the person to whom the vehicle is entrusted. Hence, the exclusion is applicable by virtue of the use of the vehicle away from the premises. The same reasoning applies to a situation where the vehicle is in the hands of a child where there is a negligent failure of control.
As the Alabama court said in Cooter, supra, p. 499:
"It is the concurrence of these dual elements negligent entrustment by the owner or custodian of the instrumentality plus its negligent use . . . that is missing in the rationale of those cases upholding coverage."
*483 Plaintiffs place substantial reliance on Lawver v. Boling, 71 Wis. 2d 408, 238 N.W.2d 514 (1976). The plaintiffs assert that, where injuries are proximately caused by an insured risk and an excluded risk, the insurer is liable. We need not quarrel with that assertion in the instant case, for its application herein begs the question. The assumption of the plaintiffs is that negligence as to entrustment and negligence as to control are risks that are insured. In the instant case, it is clear that it is only the "occurrence" the accident that is insured against and, if the use of the automobile is away from the premises and the accident occurs there, there is no conduct that is insured. All coverage is excluded.
Moreover, Lawver relied upon State Farm Mut. Automobile Ins. Co. v. Partridge, 10 Cal. 3d 94, 109 Cal. Rptr. 811, 514 P.2d 123 (1973). In that case, the insured was hunting rabbits from his vehicle while driving and holding a gun. He turned off the road and hit a bump, causing the gun to discharge, wounding his passenger. The trial court found the defendant negligent in modifying his gun to give it a "hair trigger action" and in driving his vehicle off the paved road onto rough terrain. 10 Cal. 3d at 99. The Supreme Court of California emphasized that one of the negligent acts was auto-related and the other was non-auto-related. It concluded that an exclusion in a homeowners policy for injuries arising out of the use of a motor vehicle "does not preclude coverage when an accident results from the concurrence of a non-auto-related cause and an auto-related cause . . . ." 10 Cal. 3d at 97. The court acknowledged that a homeowners policy does not generally afford coverage for ordinary automobile accidents arising solely out of the use of an automobile.
The Partridge analysis does not result in coverage in this case. There is no "non-auto-related" cause here. The parents' alleged entrustment of the motorcycle to their son or failure to control his use of the motorcycle *484 was motor-vehicle related. If they are liable, it is not for a general failure to supervise the son, but for a failure to control his behavior in a specific respect driving the motorcycle. In Partridge, the modification of the gun could have resulted in an accident which would render the defendant liable without the involvement of an automobile. 10 Cal. 3d at 103. Here, the parents' acts could not render them liable without their son's operation of the vehicle. Therefore, there is no coverage under the homeowners policy.
The Lawver rationale, where there was a dispute as to the cause of the accident, auto-related versus non-auto-related, is not germane to the issue here. In the instant case, the parents of Richard Mueller could not be liable under any circumstance unless Richard used the vehicle. In addition, they owned it, and it was this evidence of ownership that made it possible to entrust the motorcycle to Richard. Most important, however, is the plain language of the exclusion, which demonstrates that all conceivable coverage is excluded when there is an automobile accident or occurrence resulting in bodily injury or property damage away from the premises.
By the Court. Decision affirmed.
NOTES
[1] Bankert v. Threshermen's Mut. Ins. Co., 105 Wis. 2d 438, 313 N.W.2d 854 (Ct. App. 1981), on appeal from an order of the circuit court for Jefferson county dated October 14, 1980, John B. Danforth, Circuit Judge. Although the court of appeals labeled its decision as modification and affirmance of the trial court's decision, it was in fact a reversal.
[2] The actual farmowners' insurer is Watertown Mutual, but it is 100 percent reinsured by Threshermen's. The same principles apply to both. For convenience and for the sake of consistency with the nomenclature of the court of appeals' decision, we will refer only to Threshermen's Mutual Insurance Company.
[3] See, McGee v. Hahn, 192 Wis. 121, 212 N.W. 66 (1927); Kempf v. Boehrig, 95 Wis. 435, 290 N.W.2d 562 (Ct. App. 1980), for recent discussions of Hopkins v. Droppers.
[4] We omit any discussion of statutory liability of parents; e.g., sec. 343.15(2), Stats., refers only to children who are, by nature of their parents' sponsorship, licensed to drive motor vehicles. Here, Richard Mueller was not licensed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582347/ | 121 Mich. App. 827 (1982)
329 N.W.2d 506
KELLY
v.
ZURICH INSURANCE COMPANY
Docket No. 62473.
Michigan Court of Appeals.
Decided December 7, 1982.
Green, Renner, Weisse, Rettig, Rademacher & Clark (by Richard C. Clark), for plaintiff.
Platt, Peacock & Lantzy, P.C. (by P. David Vinocur), for Zurich Insurance Company.
Butch, Quinn, Rosemurgy, Jardis & Valkanoff, P.C. (by Allen S. Bush), for Citizens Insurance Company of America.
Before: D.F. WALSH, P.J., and ALLEN and M.F. CAVANAGH, JJ.
D.F. WALSH, P.J.
Third-party defendant Citizens Insurance Company of America appeals from the determination of the Delta County Circuit Court that third-party defendant is responsible to Jonathan Hunter Kelly for no-fault personal protection insurance benefits.
This controversy is essentially a dispute between two insurance companies. Third-party plaintiff Zurich Insurance Company is the no-fault insurer of the owner and operator of a car which struck Jonathan Kelly, a minor, on August 26, 1979. Third-party defendant is the no-fault insurer of Stephen Merli, who lives with Jonathan and Jonathan's mother and who is the father of two of Jonathan's mother's children. Mr. Merli is not Jonathan's father and is not legally married to *829 Jonathan's mother. Neither Jonathan nor his mother was covered by no-fault automobile insurance as named insureds at the time of the accident.
The circuit court determined that Jonathan's mother was Mr. Merli's "spouse" for purposes of the no-fault act and that third-party defendant, therefore, was liable for personal protection insurance benefits to Jonathan. We reverse.
MCL 500.3114(1); MSA 24.13114(1), provides that no-fault personal protection insurance benefits are payable to the person named in a personal protection insurance policy, the person's spouse, and the relatives of either domiciled in the same house-hold.
In construing a different section of the no-fault act, this Court recently rejected a woman's claim for survivor's benefits under a provision establishing a wife's conclusive presumption of dependency on "a husband with whom she lives at the time of his death". MCL 500.3110(1)(a); MSA 24.13110(1)(a). Jacobs v Michigan Mutual Ins Co, 106 Mich. App. 18; 307 NW2d 693 (1981). The claimant had lived with the insured but had never been formally married to him. The Court's rejection of the plaintiff's "expansive meaning" of "wife" is equally applicable to the instant third-party plaintiff's request that Jonathan Kelly's mother be considered Mr. Merli's "spouse" for purposes of MCL 500.3114(1); MSA 24.13114(1):
"The American Heritage Dictionary of the English Language (New College Edition, 1976) defines `wife' as `a woman married to a man'. In Michigan, consent alone has not been enough to effectuate a marriage since January 1, 1957. See MCL 551.2; MSA 25.2. We note that plaintiff does not claim that she and Bennett contracted to live together before that date. Plaintiff *830 was not Bennett's `wife' according to the common and approved usage of that word." Jacobs v Michigan Mutual Ins Co, supra, p 22.
In the construction of a statute, words are to be given their common and approved meanings. MCL 8.3a; MSA 2.212(1). No citation of authority is necessary in support of the proposition that the common and approved meaning of the word "spouse" is husband or wife.[1] We hold, therefore, that "spouse", as that term is used in MCL 500.3114(1); MSA 24.13114(1), means "legal husband" or "legal wife". This holding comports with the primary principle of statutory construction that the Legislature's intent be effectuated. White v Ann Arbor, 406 Mich. 554; 281 NW2d 283 (1979). The Michigan Legislature, which has expressly provided that common-law marriages are no longer recognized in this state, clearly did not intend that "common law spouses" be treated as spouses for purposes of the no-fault act. MCL 551.2; MSA 25.2. Nor could no-fault insurers or insureds have reasonably so intended.
We vacate the circuit court's finding that Jonathan's mother is Mr. Merli's spouse, and we set aside the order directing third-party defendant to pay personal protection insurance benefits to Jonathan. Because the circuit court did not resolve third-party plaintiff's claim that Jonathan and Mr. Merli are "relatives" as that term is used in the no-fault act and in the insurance policy issued to Mr. Merli by third-party defendant, we remand to the circuit court for consideration of that claim.[2] We retain no further jurisdiction. Costs to third-party defendant.
NOTES
[1] In the Mental Health Code, the Legislature nevertheless provided a definition of "spouse" which reflects this common and approved meaning. MCL 330.1800(b); MSA 14.800(800)(b).
[2] See Hartman v Ins Co of North America, 106 Mich. App. 731; 308 NW2d 625 (1981), lv den 413 Mich. 915 (1982). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582344/ | 976 F. Supp. 1373 (1997)
Daniel HAGY, individually and as Personal Representative of the Estate of Tracia Hagy, deceased, Plaintiff,
v.
UNITED STATES of America, et al., Defendants.
No. C96-1181WD.
United States District Court, W.D. Washington.
May 6, 1997.
*1374 *1375 Craig E. Kastner, Law Offices of Craig E. Kastner, Issaquah, WA, Joel D. Cunningham, Luvera, Barnett, Brindley, Beninger & Cunningham, Seattle, WA, for Daniel Hagy.
Philip H. Lynch, U.S. Atty's Office, Seattle, WA, Elizabeth A. Russell, U.S. Dept. of Justice, Torts Branch, Civil Division, Washington, DC, for U.S.
Elizabeth K. Reeve, Robert F. Kehoe, Schwabe, Williamson, Ferguson & Burdell, Seattle, WA, for State of Maryland, Habor General Hosp.
ORDER ON MOTION OF DEFENDANT UNITED STATES FOR DISMISSAL PURSUANT TO FED.R.CIV.P. 12(b)(1)
DWYER, District Judge.
Plaintiff Daniel Hagy has sued the United States for the wrongful death of his wife Tracia. Tracia allegedly contracted a fatal neurological disease, known as Creutzfeldt-Jakob Disease, from contaminated humangrowth-hormone treatments she received as a child. Her doctor allegedly obtained the contaminated material from a government-funded program. The United States has moved to dismiss for lack of jurisdiction.[1] No party has requested oral argument, and none is necessary.
*1376 BACKGROUND
The human pituitary gland produces a hormone known as hGH. A deficiency of hGH during childhood results in hypopituitary dwarfism, which can be treated by hormone replacement. Until 1985, when the FDA approved the use of biosynthetic hGH, human pituitaries were the only source of hGH.
In 1963, the National Institute of Health (NIH) awarded Johns Hopkins University School of Medicine a cost-reimbursement contract, which provided funding for the establishment of the National Pituitary Agency. The Agency coordinated the collection of pituitaries and the extraction of hGH, and distributed hGH to "investigating" physicians throughout the country for use in the treatment of hGH-deficient children. The actual extraction and purification of hGH was done by several outside scientists, who also received funds from the NIH through research grants awarded to their respective universities. In 1967, the University of Maryland was awarded a similar contract to carry on the Agency's work. The University of Maryland operated the Agency, which was eventually renamed the "National Hormone and Pituitary Program" (NHPP), until 1992.[2]
Tracia Hagy received hGH treatments from an investigating physician at the University of California at San Francisco (UCSF) between 1975 and 1977. In 1993, Tracia died from Creutzfeldt-Jakob Disease. She allegedly contracted the disease from contaminated hGH treatments she received at UCSF.
Tracia's surviving husband, Daniel, brings this action for wrongful death against the United States pursuant to the Federal Tort Claims Act (FTCA), 28 U.S.C. §§ 1346(b), 2671-80. He claims that the government is liable for having provided UCSF with the contaminated hGH, and for having failed to discover and warn of the danger the hGH treatments posed to recipients. The United States has moved to dismiss, contending that plaintiff's claims fall within exceptions to the FTCA's general waiver of sovereign immunity.
DISCUSSION
The Federal Tort Claims Act is a limited waiver of sovereign immunity, rendering the United States liable to the same extent as a private party for certain torts of federal employees. 28 U.S.C. § 1346(b). The question of whether a plaintiff's claims fall within the scope of the waiver is one of subject matter jurisdiction. In that regard, no presumptive truthfulness attaches to the facts alleged in the complaint. St. Clair v. City of Chico, 880 F.2d 199, 201 (9th Cir. 1989). Rather, in determining whether it has jurisdiction, the court may review evidence beyond the pleadings and resolve factual disputes where necessary, so long as those factual disputes are not "so intertwined with the merits that their resolution depends on the resolution of the merits." Careau Group v. United Farm Workers of America, 940 F.2d 1291, 1293 (9th Cir.1991). The material jurisdictional facts in this case are not intertwined in that way, and are substantially undisputed.
Plaintiff bears the initial burden of pleading claims that fall within the FTCA's limited waiver of immunity. Prescott v. United States, 973 F.2d 696, 701 (9th Cir. 1992). He has satisfied that burden by alleging that the NIH negligently provided the contaminated hGH to UCSF. See First Amended Complaint, Dkt. # 10, at ¶ 6.4. He has also alleged that the United States is subject to liability for its negligent failure to discover and/or warn of the danger posed to hGH recipients. See id. at ¶ 7.1(3).
The government bears the burden of proving that the plaintiff's claims fall within an exception to the FTCA. Prescott, 973 F.2d at 702. Here, the government contends that each alleged jurisdictional basis falls before a different FTCA exception. First, the government argues that it cannot be held liable for providing UCSF with contaminated hGH because the hGH in question came from an independent contractor, not from the government. Second, the government says it cannot *1377 be held liable for an alleged failure to investigate and warn because any such failure would fall within the FTCA's "discretionary function" exception. Alternatively, the government argues that plaintiff's direct negligence claim should be dismissed because, under Maryland tort law, the United States had no duty to discover or warn of the alleged danger posed by the treatments.[3]
A. The "Independent Contractor" Exception
Although Plaintiff alleges in his complaint that the contaminated hGH came from the NIH, the government has submitted evidence, and plaintiff does not dispute, that the hGH in question came from the NHPP, not the NIH. See Tolman Dec. at ¶¶ 10-11. The government argues that it cannot be held liable for the negligence of the NHPP or the hGH extractors because it has not waived immunity for the torts of government contractors. Plaintiff counters that the NHPP was the NIH for purposes of the FTCA.
The FTCA's definition of "government employee" includes officers and employees of federal agencies, but excludes "any contractor with the United States." 28 U.S.C. § 2671; United States v. Orleans, 425 U.S. 807, 814, 96 S. Ct. 1971, 1976, 48 L. Ed. 2d 390 (1976). Government contractors, such as the NHPP, or grantees, such as the hGH extractors, are federal agencies for purposes of the FTCA only if "the government had the authority to control the detailed physical performance of the contractor and exercised substantial supervision over their day-to-day activities." Laurence v. Dept. of Navy, 59 F.3d 112, 113 (9th Cir.1995) (citing Orleans, 425 U.S. at 814-15, 96 S.Ct. at 1975-76).
The United States has submitted evidence that the NIH had no such authority and exercised no such control over the NHPP or the hGH extractors. Dr. Condliffe, the NIH's project officer for the NHPP from 1972-75, and Dr. Tolman, Dr. Condliffe's successor, have both explained that their duties were limited to monitoring the work at the NHPP. Condliffe Dep. at 8:8-12; Tolman Dep. at 34:12-35:14; Tolman Dec. at p. 4 ¶ 10. In his deposition, Dr. Tolman described his monitoring duties as follows:
I read progress reports, sometimes performed site visits to make sure that things seemed to be going all right, and if there were any comments from any of the investigators that were getting the material, why, of course, I would listen to what they had to say and so forth, but that was ... the way I monitored.
Tolman Dep. at 34:14-20; see also Tolman Dec. at p. 4 ¶ 10 ("I monitored work progress, evaluated work performance and participated in decisions regarding disposition of funds, all in order to assure that the work was being performed efficiently and in accordance with the contracts."). Tolman affirmed that his duties were similarly limited with regard to the hGH extractors. Tolman Dec. at p. 5 ¶ 11. Such monitoring duties are not the sort of substantial, day-to-day government supervision necessary to convert a government contractor into a federal agency for purposes of the FTCA.
Plaintiff argues that the requisite amount of government control is demonstrated by the fact that the NIH "put an immediate stop to the program" when it discovered an hGH recipient had contracted Creutzfeldt-Jakob Disease. But as Drs. Tolman and Condliffe explained in their depositions, the NIH could do no more than stop funding the program; it could not prevent the NHPP from continuing its program with private funds. See Tolman Dep. at 29:4-22; 37:6-17; Condliffe Dep. at 25:8-26:6. "[T]he granting of funds can be conditional without changing the basic relationship" between the federal government and its contractors and grantees. Orleans, 425 U.S. at 816 n. 6, 96 S.Ct. at 1977 n. 6. Further, the relevant question is not whether the NIH had the authority to shut down the NHPP, but whether the NIH exercised substantial control over the NHPP's daily activities. The United States has established that the NIH exercised no such *1378 control, even if the NIH did have the authority to shut the NHPP down.
Plaintiff also relies on numerous statutes and regulations for his claim that the NIH exercised the requisite amount of control over the NHPP. This reliance is misplaced. The government's "ability to compel [a contractor's] compliance with federal regulation does not change a contractor's personnel into federal employees." Letnes v. United States, 820 F.2d 1517, 1519 (9th Cir.1987). The question is not whether the contractor "receives federal money and must comply with federal standards and regulations, but whether its day-to-day operations are supervised by the Federal Government." Orleans, 425 U.S. at 815, 96 S.Ct. at 1976.
The government has submitted evidence establishing that the NIH did not supervise or direct the daily activities of either the NHPP or the hGH extractors. Plaintiff has introduced no evidence to the contrary. The independent contractor exception applies the government cannot be held vicariously liable for the negligence of the NHPP or the hGH extractors.
Plaintiff's request for additional discovery on the issue of governmental control of the NHPP is denied. The court has already granted one such request, see Dkt. # 20, and plaintiff unearthed no evidence of government control warranting further discovery.
B. The "Discretionary Function" Exception
Plaintiff argues that even if the United States is not subject to suit for the negligence of the NHPP or the hGH extractors, it may be sued for its own negligent failure to (1) discover or (2) warn of the risks associated with the use of hGH. Plaintiff correctly argues that such a claim is not barred by the independent contractor exception. The government contends, however, that these jurisdictional bases for plaintiff's suit are invalidated by the "discretionary function" exception to the FTCA.
28 U.S.C. § 2680(a) provides, in pertinent part, that the United States is not liable for any claim "based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused." 28 U.S.C. § 2680(a). This portion of section 2680(a), known as the "discretionary function" exception, "insulates the Government from liability if the action challenged in the case involves the permissible exercise of policy judgment." Berkovitz v. United States, 486 U.S. 531, 537, 108 S. Ct. 1954, 1959, 100 L. Ed. 2d 531 (1988).
The Supreme Court has articulated a two-part test for determining whether the discretionary function exception shields the United States from liability for a particular act or omission of a government employee. First, the exception only applies to acts that are discretionary in nature. United States v. Gaubert, 499 U.S. 315, 322, 111 S. Ct. 1267, 1273, 113 L. Ed. 2d 335 (1991). If the challenged act is prescribed, the exception does not apply. Id. Second, the discretionary decision must be "of the kind that the discretionary function exception was designed to shield" that is, a governmental decision "based on considerations of public policy." Id. at 322-23, 111 S.Ct. at 1274.
1. Failure to Discover the Danger
The NIH "failed to discover the danger" because it never undertook responsibility for investigating but, instead, left the responsibility for determining the risks of treating children with hGH with the NHPP. See Tolman Dep. at 20:15-21:3, 32:1-33:3; Condliffe Dep. at 13:25-14:17. The government contends that no statute, regulation or contract term proscribed such a decision or prescribed a different course of conduct, and plaintiff points to none. The decision was thus discretionary. The first part is satisfied.
As to the second part, the NIH's decision to delegate safety and warning responsibilities to the NHPP is the type of policy decision the discretionary function exception was designed to shield. Such a decision requires the agency "to establish priorities for the accomplishment of its policy objectives by balancing the objectives sought to be obtained against such practical considerations *1379 as staffing and funding." United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S. 797, 820, 104 S. Ct. 2755, 2767, 81 L. Ed. 2d 660 (1984). In light of such practical considerations, an agency may determine that operational safety will be enhanced through reliance on the contractor's special expertise. See Duff v. United States, 999 F.2d 1280, 1281 (8th Cir. 1993) (decision to delegate safety issues to contractor grounded in policy because the decision allowed government "to take advantage of a contractor's special expertise, thereby creating the opportunity for a safer, more efficient operation."); Layton v. United States, 984 F.2d 1496, 1502-03 (8th Cir.1993) (delegation of safety responsibility to contractor covered by exception). The discretionary function exception was designed to prevent judicial second-guessing of such policy decisions through tort actions. Varig Airlines, 467 U.S. at 814, 104 S.Ct. at 2764-65. The second part of the test is satisfied.
Plaintiff argues that the discretionary function exception "does not apply to decisions and actions regarding medical treatment." He relies on cases holding that the exception does not apply where "only professional, non-governmental discretion is at issue." Lather v. Beadle County, 879 F.2d 365, 367 (8th Cir.1989) (allegedly negligent medical judgment not covered by exception); see Collazo v. United States, 850 F.2d 1, 2 (1st Cir.1988) (same). This line of argument fails because the decision here whether to take responsibility for safety matters is a governmental decision, not a medical one.
Plaintiff also cites Berkovitz for the proposition that "the discretionary function exception does not shield decisions whereby `the government creates a dangerous medical risk by approving the release of a drug or other treatment which causes harm.'" But Berkovitz does not stand for that. In that case, the plaintiff alleged that the government agency failed to comply with a specific mandatory directive to review data and test all polio vaccine lots before release to the public. See 486 U.S. 531, 547, 108 S. Ct. 1954, 1964, 100 L. Ed. 2d 531 (1988). Because the decision to test was non-discretionary, the discretionary function exception did not shield the government from liability. Id. at 547-48, 108 S.Ct. at 1964-65. Plaintiff does not allege violation of a mandatory directive.
"When an agency determines the extent to which it will supervise the safety procedures of private individuals, it is exercising discretionary regulatory authority of the most basic kind." Varig Airlines, 467 U.S. at 819-20, 104 S.Ct. at 2767. Consequently, the court is without jurisdiction over plaintiff's claim that the United States is liable for its allegedly negligent failure to discover the danger.
2. Failure to Warn
Plaintiff's alternative claim that the NIH knew of the danger and failed to warn of it is subject to a similar analysis. First, plaintiff points to no directive requiring such a warning and the government submits that there is none. Any decision not to warn was thus discretionary. Again, the first part of the test is satisfied.
As to the second part, any decision not to warn the public of a danger posed by hGH is by nature policy-laden. The question of whether to take on the task of warning the public of such health dangers raises the same staffing and resource concerns as that of whether to investigate for risks; either action would require a substantial commitment of resources. Further, the decision to warn or not to warn in such a situation involves, among other considerations, balancing the importance of the given activity against the risks, if any, posed to the subjects. See Begay v. United States, 768 F.2d 1059, 1065 (9th Cir.1985) (decision not to warn uranium miners of danger of radiation exposure, even after risks had become known, covered by exception). The decision to warn or not to warn is susceptible to policy analysis. The second part of the test is thus satisfied, and this court is without jurisdiction to hear plaintiff's failure to warn claim.
Plaintiff argues that "[w]hile the precise manner and degree to which the public should be warned may involve a degree of discretionary judgment, the decision not to warn at all as to an obvious danger is not." The question, however, is not whether the *1380 danger was obvious, but whether the decision to issue a warning or not is susceptible to policy analysis. Plaintiff relies on cases where the court determined that the particular decision not to warn was not susceptible to such analysis. See, e.g., Schmoldt v. Wadco Industries, Inc., 941 F. Supp. 905, 909 (D.Ariz.1996) (failure to warn contractor of safety violation not policy based); Marin v. United States, 814 F. Supp. 1468, 1483 (decision not to warn known intended victim or local police of release of informant from custody not subject to policy analysis). Here, the decision not to warn the public of the danger of hGH treatments assuming such a decision was made is susceptible to policy analysis. Because there was no directive prescribing a different course of conduct, the discretionary function exception applies.[4]
Finally, plaintiff argues that a trial is necessary because the question of whether the discretionary function exception applies is "highly fact specific." But there are no material issues of fact remaining. Plaintiff concedes that no directive required particular government actions in this case, and the government has demonstrated that the decisions at issue are subject to policy analysis. That is sufficient to show lack of jurisdiction. Lesoeur v. United States, 21 F.3d 965, 967-68 (9th Cir.1994) (government need only prove that decision is subject to policy analysis, not that it actually balanced factors).
CONCLUSION
The United States cannot be held liable for the negligence of either the NHPP or the hGH extractors because it has not waived immunity for the torts of its contractors and grantees. The discretionary function exception prevents the FTCA from being applied to hold the United States liable for its own alleged failure to discover the danger of using human hGH to treat dwarfism, or for an alleged failure to warn the public of it. For the reasons stated, the court is without jurisdiction under the FTCA, and the motion of defendant United States for dismissal pursuant to Federal Rule of Civil Procedure 12(b)(1) is granted.
NOTES
[1] The lawsuit also names the Johns Hopkins University School of Medicine, the State of Maryland, Harbor General Hospital, and ten John Doe physicians as defendants. The University of Maryland was originally named as a defendant, but has since been dismissed without prejudice. See Dkt. # 27. The present motion involves only the United States.
[2] In 1977, Harbor General Hospital was awarded a cost-reimbursement contract for the extraction and purification of hGH, which it provided to the NHPP. The NHPP stopped distributing hGH in 1985.
[3] The NIH is located in Maryland. Plaintiff's direct negligence claims are thus governed by Maryland law. 28 U.S.C. § 1346(b).
[4] Because the discretionary function exception applies, the court need not reach the issue of whether plaintiff's direct negligence claims are cognizable under applicable state law. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2440488/ | 967 N.E.2d 504 (2008)
382 Ill. App. 3d 1228
359 Ill. Dec. 774
PEOPLE
v.
SHABEL.
No. 4-07-0579.
Appellate Court of Illinois, Fourth District.
July 14, 2008.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/599218/ | 984 F.2d 1083
UNITED STATES of America, Plaintiff-Appellee,v.Michael HUGABOOM, Defendant-Appellant.
No. 91-2275.
United States Court of Appeals,Tenth Circuit.
Jan. 21, 1993.
Charles S. Aspinwall, Albuquerque, NM, for defendant-appellant.
Tara C. Neda, Asst. U.S. Atty. (Don J. Svet, U.S. Atty. with her on the brief), Albuquerque, NM, for plaintiff-appellee.
Before BALDOCK, SETH and KELLY, Circuit Judges.*
PAUL KELLY, Jr., Circuit Judge.
1
On February 7, 1991, officers executed a search warrant for the residence of Robert Brown. A methamphetamine laboratory was discovered and Defendant-appellant Michael Hugaboom, who was present at the time, was arrested. The facts of the case are more fully set forth in United States v. Brown, 984 F.2d 1074 (10th Cir.1992).
2
Mr. Hugaboom was tried along with Robert Brown and Howard Beard and convicted of conspiracy to manufacture methamphetamine in violation of 21 U.S.C. §§ 846, 841(a)(1), and 841(b)(1)(C). Mr. Hugaboom appeals, arguing that no probable cause existed to support his arrest and evidence seized as a result of that arrest should have been suppressed. We affirm.
3
Defendant argues that his arrest was predicated on "mere presence." We disagree. Officers were executing a valid warrant when they encountered the very strong odor associated with a methamphetamine laboratory. United States v. Brown, 984 F.2d 1074. During the execution of a previous search warrant at this residence, Mr. Hugaboom attempted to escape the scene, but was apprehended. Officers testified that all those present, including Defendant, had the same smell of a methamphetamine laboratory. Drug paraphernalia as well as several packets of a substance suspected to be methamphetamine were found at the residence.
4
Probable cause exists "where the facts and circumstances known to the police are sufficient in themselves to warrant a prudent officer in the belief that an offense has been or is being committed." United States v. Borrelli, 621 F.2d 1092, 1095 (10th Cir.), cert. denied, 449 U.S. 956, 101 S. Ct. 365, 66 L. Ed. 2d 222 (1980) (citing McCray v. Illinois, 386 U.S. 300, 87 S. Ct. 1056, 18 L. Ed. 2d 62 (1967)). We hold that the circumstances described here are sufficient to establish probable cause to arrest. See United States v. Lillard, 929 F.2d 500, 502 (9th Cir.1991) (distinctive smell of methamphetamine together with other suspicious factors gave probable cause to arrest).
5
AFFIRMED.
SETH, Circuit Judge, dissenting:
6
I cannot agree with the majority opinion in this appeal. Thus, as I discussed in my dissent in United States v. Brown, 984 F.2d 1074 (10th Cir.), the officers were not executing a valid warrant when they detected the methamphetamine laboratory. The warrant was based on a prior warrant which contained language and was executed in a manner that converted it to a general warrant. Further, the warrant at issue here contained similar language. Both warrants were overbroad and thus did not conform to the Fourth Amendment's particularity requirement. For the reasons stated in my dissent in Brown, I would suppress the evidence and reverse the conviction. Accordingly, I dissent.
*
After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed.R.App.P. 34(a); 10th Cir.R. 34.1.9. The cause therefore is ordered submitted without oral argument | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1645149/ | 40 So.3d 929 (2010)
Teddy Keith WADE, II, Appellant,
v.
STATE of Florida, Appellee.
No. 1D09-6425.
District Court of Appeal of Florida, First District.
August 10, 2010.
Nancy A. Daniels, Public Defender, and Glenna Joyce Reeves, Assistant Public Defender, for Appellant.
Bill McCollum, Attorney General, and Sonya Roebuck Horbelt, Assistant Attorney General, for Appellee.
PER CURIAM.
Appellant, Teddy Keith Wade, challenges his conviction for Organized Fraud, Uttering a Forged Check, and Grand Theft. Because the State did not commence prosecution for the Organized Fraud and Uttering a Forged Check offenses before their respective statutes of limitations expired; and, because the State failed to demonstrate the delay in prosecution was reasonable, we find prosecution for these two offenses was time-barred. See § 775.15(5), Fla. Stat. (2005).
We reverse Mr. Wade's convictions for Organized Fraud and Uttering a Forged Check, affirm his conviction for Grand Theft and remand for the trial court to resentence Mr. Wade consistent with this opinion.
REVERSED.
HAWKES, C.J., KAHN and WEBSTER, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1011481/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
No. 02-4257
JOHN EDWARD JONES, JR., a/k/a
Liddy,
Defendant-Appellant.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
William N. Nickerson, Senior District Judge.
(CR-98-48-WMN)
Argued: May 9, 2003
Decided: September 12, 2003
Before WILLIAMS, MICHAEL, and SHEDD, Circuit Judges.
Affirmed by unpublished per curiam opinion. Judge Williams wrote
an opinion concurring in the judgment. Judge Shedd wrote an opinion
concurring in the judgment. Judge Michael wrote a dissenting opin-
ion.
COUNSEL
ARGUED: Sol Zalel Rosen, Washington, D.C., for Appellant.
Andrea L. Smith, Assistant United States Attorney, Baltimore, Mary-
land, for Appellee. ON BRIEF: Thomas M. DiBiagio, United States
Attorney, Jane M. Erisman, Assistant United States Attorney, Balti-
more, Maryland, for Appellee.
2 UNITED STATES v. JONES
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
The judgment of the district court is
AFFIRMED.
WILLIAMS, Circuit Judge, concurring in the judgment:
In an earlier appeal in this case, we vacated the sentence imposed
upon John Edward Jones, Jr., after his conviction under 21 U.S.C.A.
§ 846 (West 1999) for conspiracy to distribute narcotics and
remanded for resentencing in light of Apprendi v. New Jersey, 530
U.S. 466 (2000). See United States v. Jones, 2001 WL 1019398, 17
Fed. Appx. 240 (4th Cir. Dec. 18, 2001) (per curiam) (unpublished).
At resentencing, Jones raised, for the first time, the issue of whether
he had timely been served with notice, as mandated by 21 U.S.C.A.
§ 851 (West 1999), that the Government intended to proceed against
him as a repeat offender.1 The district court concluded that the § 851
information was timely filed, and Jones appeals. Because I conclude
that Jones waived his argument regarding the timeliness of the § 851
information by failing to raise it in his initial appeal, I would affirm.
1
Section 851 provides, in relevant part,
No person who stands convicted of an offense under this part
shall be sentenced to increased punishment by reason of one or
more prior convictions, unless before trial, or before entry of a
plea of guilty, the United States attorney files an information
with the court (and serves a copy of such information on the per-
son or counsel for the person) stating in writing the previous
convictions to be relied upon.
21 U.S.C.A. § 851 (West 1999).
UNITED STATES v. JONES 3
I.
Jones was indicted for conspiracy to distribute heroin and mari-
juana, in violation of § 846. Drug quantity was not specified in the
indictment. The jury was asked to return a general verdict on whether
the defendants were guilty of conspiracy to distribute narcotics, with-
out specifying the drug type (marijuana or heroin). The jury found all
four defendants guilty, and the court imposed a 210-month sentence
on Jones.
In his initial appeal in this case, Jones challenged both his convic-
tion and sentence on several grounds, arguing that: (1) the district
court erred in allowing the jury to return a general verdict not specify-
ing drug type where the indictment charged him with a conspiracy
involving both heroin and marijuana; (2) there was insufficient evi-
dence to support the conviction; (3) the district court’s factual find-
ings as to drug quantity violated Apprendi, and the district court erred
in relying on a government informant’s testimony to calculate quan-
tity; and (4) the district court erred in refusing to give an instruction
on the lesser-included offense of simple possession of marijuana.
Jones, 17 Fed. Appx. at 244 & n.2.
We rejected each of Jones’s contentions except his argument con-
cerning Apprendi. With respect to that argument, we concluded that
Jones’s sentence violated the rule dictated by Apprendi — "that in
order to authorize the imposition of a sentence exceeding the maxi-
mum allowable without a jury finding of a specific threshold drug
quantity, the specific threshold quantity must be treated as an element
of an aggravated drug trafficking offense." Jones, 17 Fed. Appx. at
248 (quoting United States v. Promise, 255 F.3d 150, 156 (4th Cir.
2001) (en banc)). Without a jury finding of a specific threshold quan-
tity of marijuana, the statutory maximum sentence for conspiracy to
distribute marijuana is ten years’ imprisonment if the defendant has
a prior felony drug conviction. See § 841(b)(1)(D). In light of Jones’s
prior felony drug conviction, we reasoned, the maximum sentence he
could receive was ten years, and we remanded for the district court
to sentence him in compliance with that limit. Jones, 17 Fed. Appx.
at 248.
At resentencing, Jones argued that the § 851 information filed by
the Government was untimely because it was filed after voir dire had
4 UNITED STATES v. JONES
begun. Jones contended that, for purposes of § 851, trial begins when
voir dire begins, and thus failure to file before that point constitutes
failure to file "before trial," as § 851 requires. Because the § 851
information was untimely filed, Jones argued, his sentence should be
limited to five years, the applicable statutory maximum sentence
where the defendant does not have a prior felony drug conviction and
there is no jury finding of drug quantity. See § 841(b)(1)(D). The dis-
trict court held that filing the information before the jury was sworn
constituted filing "before trial," and therefore that the Government
had complied with § 851. The district court sentenced Jones to ten
years’ imprisonment. Jones appeals, arguing only that the § 851 infor-
mation was untimely filed.
II.
I first consider whether Jones has waived his argument concerning
the timeliness of the § 851 information. As noted above, Jones did not
raise any objection at trial to the § 851 information2 and did not raise
the timeliness issue in his initial appeal. Responding in this appeal to
the Government’s contention that he has waived any argument con-
cerning timeliness, Jones asserts that failure timely to file a § 851
information deprives the district court of jurisdiction to impose an
enhanced sentence. An objection to the timeliness of such an informa-
tion, he argues, may be raised at any time because jurisdictional
defects cannot be forfeited or waived. See American Canoe Ass’n v.
Murphy Farms, Inc., 326 F.3d 505, 515 (4th Cir. 2003) (noting that
"a party can challenge subject matter jurisdiction for the first time on
appeal even though, in most contexts, issues not raised below are con-
sidered waived").
We have not addressed in a published opinion the question of
whether § 851’s requirements are "jurisdictional." Other circuits are
2
In fact, Jones testified at trial to his prior federal conviction as part of
his broader contention that the Government had concocted the instant
prosecution against him simply as a means of keeping him in prison. He
went on to testify that he was "embarrassed" to be in federal court
charged with such a paltry amount of drugs, and suggested that if he
were dealing drugs again, it would have been in much larger quantities
than the Government was alleging. (J.A. at 99.)
UNITED STATES v. JONES 5
split on the issue. Several circuits have stated, without detailed analy-
sis, the proposition that § 851’s requirements are jurisdictional in
nature. See, e.g., United States v. Lawuary, 211 F.3d 372, 376 n.6 (7th
Cir. 2000); Harris v. United States, 149 F.3d 1304, 1306 (11th Cir.
1998); United States v. Hill, 142 F.3d 305, 312 (6th Cir. 1998);
United States v. Wright, 932 F.2d 868, 882 (10th Cir. 1991); cf. Lawu-
ary, 211 F.3d at 378 (Easterbrook, J., concurring) (noting that while
"[i]t is easy to find opinions saying that § 851(a) is a jurisdictional
rule . . . [i]t is considerably harder to find an explanation for this
assertion"; joining all parts of majority opinion except a footnote stat-
ing that § 851’s requirements are jurisdictional). On the other hand,
at least three circuits have recently held explicitly that § 851’s proce-
dural requirements are not jurisdictional and are thus subject to the
ordinary rules of waiver and forfeiture. See United States v. Ceballos,
302 F.3d 679, 690-92 (7th Cir. 2002) (panel opinion overruling Lawu-
ary’s footnote statement that § 851(a)’s requirements are jurisdic-
tional and cannot be waived, because that statement was based on
circuit precedent unsupported by reasoning), cert. denied, ___ U.S.
___, 123 S. Ct. 924, 925, and ___ U.S. ___, 123 S.Ct. 1571 (2003));
United States v. Mooring, 287 F.3d 725, 727 (8th Cir. 2002) (conclud-
ing that § 851(a)’s requirements are not jurisdictional); Prou v. United
States, 199 F.3d 37, 43-46 (1st Cir. 1999) (same).
The Supreme Court has instructed that subject matter jurisdiction
is "the courts’ statutory or constitutional power to adjudicate the
case." United States v. Cotton, 535 U.S. 625, 630 (2002) (quoting
Steel Co. v. Citizens for Better Env’t, 523 U.S. 83, 89 (1998)). Not
all statutory delineations of the court’s power to act in a given case
are jurisdictional provisions, however. In Steel Co., the Court held
that a statute stating that "‘[t]he district court shall have jurisdiction
in actions brought under subsection (a) of this section . . . [to grant
certain relief],’" did not affect the jurisdiction of the court; instead,
the statute was properly read as "specifying the remedial powers of
the court, viz., to enforce the violated requirement and to impose civil
penalties." Steel Co., 523 U.S. at 90. Nothing in its jurisprudence, the
Court noted, suggested "the expansive principle that a statute saying
‘the district court shall have jurisdiction to remedy violations [in spec-
ified ways]’ renders the existence of a violation necessary for subject-
matter jurisdiction." Id. at 91-92.
6 UNITED STATES v. JONES
Nor does the omission from an indictment of a fact that enhances
the statutory maximum sentence affect the court’s jurisdiction to
impose an enhanced sentence. In Cotton, the Supreme Court held that
"defects in an indictment [in Cotton, the omission of drug quantity]
do not deprive a court of its power to adjudicate a case." Cotton, 535
U.S. at 630. Thus, the Court could conclude that there was no plain
error warranting relief in sentences exceeding the 20-year statutory
maximum for a detectable amount of cocaine or cocaine base even
though quantity had not been charged in the indictment or submitted
to the jury. Although the district court in Cotton erred in meting out
the sentences in the absence of a charge in the indictment or a jury
finding, its jurisdiction to impose the sentences was not affected by
the omission of the quantity element from the indictment.
The relevant principle from Steel Co. and Cotton is that only those
claims that concern the constitutional or statutory limits of the court’s
authority to adjudicate in a given action implicate jurisdiction. The
district courts have jurisdiction over drug prosecutions brought under
the federal drug laws pursuant to 18 U.S.C.A. § 3231, which states
that "[t]he district courts of the United States shall have original juris-
diction, exclusive of the courts of the States, of all offenses against
the laws of the United States." 18 U.S.C.A. § 3231 (West 2000).
"This jurisdiction necessarily includes the imposition of criminal pen-
alties." Prou, 199 F.3d at 45. As in Steel Co. and Cotton, a limitation
on the remedy that a district court may grant or the sentence it may
impose does not affect the court’s subject matter jurisdiction. The
court in Prou explained:
Once subject-matter jurisdiction has properly attached,
courts may exceed their authority or otherwise err without
loss of jurisdiction. See United States v. Wey, 895 F.2d 429,
431 (7th Cir. 1990) ("Courts may err, even offend the Con-
stitution, without losing subject-matter jurisdiction."); cf.
Blackledge v. Perry, 417 U.S. 21, 30 (1974) (indicating that
only claims that go "to the very power of the State to bring
the defendant into court to answer the charge brought
against him" implicate subject-matter jurisdiction). Thus,
the only question that legitimately arises from the prosecu-
tion’s late filing of a section 851(a)(1) information concerns
UNITED STATES v. JONES 7
the court’s authority to impose an enhanced sentence. This
is simply not a question of subject-matter jurisdiction.
Prou, 199 F.3d at 45 (parallel citation omitted). I agree. Accordingly,
I conclude that the provisions of § 851, like charges of drug quantity
in an indictment, are not "jurisdictional," and are thus subject to the
ordinary rules of waiver and forfeiture.
Jones does not dispute that he failed to raise any argument concern-
ing the § 851 information in his initial appeal. The result of such a
failure is waiver of the claim in question.3 See Rowland v. American
General Finance, Inc., ___ F.3d ___, 2003 WL 21912173 at *2 n.1
(4th Cir. Aug. 12, 2003) ("Given that she had the opportunity (indeed
the duty) to raise this and all other appealable issues in her initial
appeal, we conclude that she has waived appellate consideration of
this claim."); Omni Outdoor Adver., Inc. v. Columbia Outdoor Adver.,
Inc., 974 F.2d 502, 505 (4th Cir. 1992) (issues not raised on first
appeal will be considered waived and cannot be raised in a subse-
quent appeal); see also United States v. Husband, 312 F.3d 247, 251
(7th Cir. 2002) (noting that "any issue that could have been but was
not raised on appeal is waived and thus not remanded"); United States
v. Morris, 259 F.3d 894, 898 (7th Cir. 2001) ("[P]arties cannot use the
accident of remand as an opportunity to reopen waived issues.").
Because, as I explain below, Jones has waived his argument concern-
3
In addition to his jurisdictional argument, Jones asserts that he could
not have raised this issue in his first appeal because he was "of the opin-
ion that the other issues were more than sufficient to justify reversal of
the conviction," and that it would have been "improper" to argue to this
court both that he should have been convicted and sentenced only for
unlawful possession of marijuana and that his sentence for conspiracy to
distribute marijuana should have been limited based upon the Govern-
ment’s improper notice of intent to rely on a prior conviction. Inconsis-
tent defenses or appellate arguments are of course not prohibited. United
States v. Harbin, 377 F.2d 78, 80 (4th Cir. 1967). Further, as is explained
more fully in the text, Jones plainly had both an incentive and an oppor-
tunity to raise the issue in his first appeal — a five-year mandatory maxi-
mum would certainly have been relevant, as the district court initially
sentenced Jones to more than ten years, and as this court, in that appeal,
remanded with instructions to sentence him within the ten-year maxi-
mum for repeat offenders and a detectable amount of marijuana.
8 UNITED STATES v. JONES
ing the § 851 information’s timeliness, I need not consider whether
such an information filed after voir dire has begun, but before the jury
is sworn, is filed "before trial."4
While the ordinary result of failure to raise an argument in this situ-
ation is waiver, I might conclude that Jones has not waived the argu-
ment if he lacked either an opportunity or an incentive to raise the
argument at his initial sentencing in 1999 and in his initial appeal in
2001. See, e.g., United States v. Carpenter, 320 F.3d 334, 341 n.6 (2d
Cir. 2003). Even assuming that Jones lacked opportunity or incentive
to raise the § 851 issue at his initial sentencing, however, his current
challenge must fail because he not only had both an opportunity and
an incentive to raise the argument in his first appeal, but he also made
a strategic decision not to raise the issue in that appeal. See note 3,
supra.
At Jones’s initial sentencing, without the benefit of our decision in
Rhynes and the Supreme Court’s in Apprendi, the district court
assumed the propriety of its determining both drug type and quantity,
a process which led the district court to conclude under the guidelines
that a sentence of more than seventeen years was appropriate. After
the decisions in Rhynes and Apprendi, the course followed by the dis-
trict court was shown to be erroneous. This revelation made plain the
prospect of a sentence reduction to the statutory maximum applicable
to an indeterminate quantity of the least-punished drug that was an
object of the conspiracy, and it was on the basis of the decisions in
Rhynes and Apprendi that we "vacate[d] Jones’s sentence and
remand[ed] to the district court for imposition of a sentence that does
not exceed the ten-year statutory maximum set out in § 841(b)(1)(D)."
United States v. Jones, 2001 WL 1019398, 17 Fed. Appx. 240, 245
(4th Cir. Dec. 18, 2001) (per curiam) (unpublished). It hardly bears
4
As an alternative to his primary argument regarding jurisdiction,
Jones suggests that we ought to excuse his failure to raise the issue of the
§ 851 information’s timeliness on direct appeal because it was the result
of his counsel’s ineffectiveness. Ineffective assistance claims, however,
are generally not cognizable on direct appeal unless the trial record con-
clusively establishes such ineffective assistance. See United States v.
King, 119 F.3d 290, 295 (4th Cir. 1997). On the record before us, I do
not believe this is such a case.
UNITED STATES v. JONES 9
pointing out that Rhynes and Apprendi were both decided well before
Jones’s first appeal was argued, and if these decisions were the neces-
sary predicates to the excogitation of Jones’s argument, there can be
no reason why he lacked either opportunity or incentive to raise it in
that appeal. Yet the dissent, while conceding that Rhynes and
Apprendi made "the prospect of a five-year mandatory maximum"
apparent, would excuse Jones’s failure to argue for such a maximum.
Post, at 18.
Nor should we excuse Jones’s failure to raise the § 851 issue
because, at the time of his initial sentencing and first appeal, the issue
was somehow lurking in an unknowable future, becoming relevant
only after our decision in the first appeal. The § 851 issue became rel-
evant (i.e., became an argument that Jones had an incentive to raise)
not after our remand in the first appeal but when the Government
sought to rely on Jones’s prior conviction to enhance his sentence
pursuant to § 851. The dissent suggests that, at the time of Jones’s
first appeal, "the government . . . did not rely on or even mention the
§ 851 enhancement" and therefore Jones "had no reason to raise it in
his initial appeal." Post, at 18. The Presentence Investigation Report
(PSI) used at Jones’s initial sentencing, however, noted that the gov-
ernment had filed a § 851 notice and sought to rely on Jones’s prior
conviction to enhance his sentence. (J.A. at 189.) Morever, at his ini-
tial sentencing hearing, Jones’s attorney noted that the district court
had submitted a general verdict form to the jury, and his attorney
argued that because the jury had not determined the drug type
involved, the district court was limited to the statutory maximum term
applicable to the least-punished drug alleged in the indictment, in this
case marijuana. Jones’s attorney then stated
the maximum sentence to which [the defendants] could be
exposed is the five years for the marijuana, unless, as is the
case with Mr. Jones, the government has filed a notice of
subsequent offender, in which case they would double the
penalty, and he would be exposed to ten years.
(J.A. at 101 (emphases added).) Thus, even if its filing of a § 851
notice were insufficient to indicate the Government’s intent to rely on
a prior conviction to enhance Jones’s sentence, the issue plainly arose,
and was addressed, at sentencing. Indeed, Jones’s own attorney asked
10 UNITED STATES v. JONES
the court to remain within a ten-year, rather than a five-year, mini-
mum, assuming an enhancement under the very information he now
seeks to challenge as improperly filed.
The importance of the waiver rule in preventing piecemeal litiga-
tion of issues was expressed in Omni, where we stated:
The most rudimentary procedural efficiency demands that
litigants present all available arguments to an appellate court
on the first appeal. If parties who lost on appeal were
allowed to return to appellate courts to advance different,
previously available theories, cases could languish for years
before final resolution and already crowded court dockets
would swell even more.
Omni, 974 F.2d at 505; cf. also Greene v. United States, 880 F.2d
1299, 1305 (11th Cir. 1988) (petitioner’s failure to raise available sen-
tencing objection on direct appeal results in waiver for purposes of
habeas review). I cannot agree with the suggestion that we ignore this
rudimentary principle of procedural efficiency and permit Jones to lit-
igate now an issue that was available to him at the time of his first
appeal.
III.
For the foregoing reasons, I would affirm the judgment of the dis-
trict court.
SHEDD, Circuit Judge, concurring in the judgment:
On remand from our earlier decision, United States v. Jones, 17
Fed. Appx. 240 (4th Cir. 2001) (Jones I), Jones argued for the first
time that his sentence cannot exceed five years because of the govern-
ment’s alleged failure to provide timely notice that it would rely upon
a prior conviction to increase his sentence. See 21 U.S.C. § 851. The
district court fully considered and rejected Jones’ argument that the
notification was untimely and sentenced him to ten years’ imprison-
ment. Because Jones presented the § 851 argument on remand of the
initial appeal, the propriety of our consideration of the issue is not pri-
UNITED STATES v. JONES 11
1
marily a question of waiver (or forfeiture). Rather, the question is
more precisely analyzed within the framework of the mandate rule.
Jones’ argument that he faces a maximum sentence of five years does
not fall outside the parameters of our mandate in Jones I; therefore,
the issue is properly before us on this appeal. Jones’ contention that
the government failed to comply with § 851, however, is contrary to
the plain language of the statute, and the district court correctly deter-
mined that the government provided timely notice to him. Accord-
ingly, I would affirm the judgment of the district court.
I.
It is well established that a lower court is "bound to carry the man-
date of the upper court into execution and may not consider the ques-
tions which the mandate laid at rest." United States v. Bell, 5 F.3d 64,
66 (4th Cir. 1993). This doctrine, known as the mandate rule, "fore-
closes litigation on remand of issues decided by the district court but
foregone on appeal or otherwise waived." United States v. Aramony,
166 F.3d 655, 662 (4th Cir. 1999). If "the mandate of the appellate
court instructs or permits reconsideration of sentencing issues on
remand," however, the district court may consider the issues de novo.
Bell, 5 F.3d at 67 (emphasis added).
Because the mandate rule does not preclude the de novo consider-
ation of issues at resentencing, an argument presented for the first
time on remand is not necessarily waived. The conclusion that a par-
ticular argument has been waived is, of course, case-specific and
depends upon the mandate of the appellate court. For example, in
United States v. Henoud, 81 F.3d 484 (4th Cir. 1996), we vacated a
restitution order after determining that there were inconsistencies in
the record regarding the amount of restitution owed to each victim.
On remand, the defendant argued for the first time that a purported
victim should not have been considered as such because the victim
was not named in the indictment. On the second appeal, the govern-
ment argued that the defendant had waived the issue by not raising
1
See 18B C. Wright, A. Miller & E. Cooper, Federal Practice and
Procedure: Jurisdiction 2d § 4478.3, at 827 (2002) (discussing distinc-
tion between waiver and forfeiture). I will hereafter refer to this concept
as waiver.
12 UNITED STATES v. JONES
it at the initial sentencing. We noted, however, that because the pur-
pose of the remand was to determine the amount of restitution actu-
ally owed, the scope of our remand order reasonably encompassed the
arguments advanced by the defendant. Id. at 487 n.8. Accordingly, we
determined that the defendant did not waive the issue and that the
mandate rule did not preclude the district court from considering it on
remand. Id.
The scope of our remand in Jones I, therefore, is critical to deter-
mining whether the district court properly considered Jones’ § 851
argument at resentencing. In Jones I, we instructed the district court
to impose a sentence "that does not exceed the ten-year statutory max-
imum set out in § 841(b)(1)(D)." 17 Fed. Appx. at 245. While it is
arguable that we expected Jones to be sentenced to ten years, we did
not specifically rule on this point, and our mandate did not prohibit
the district court from imposing a sentence of less than ten years.
Jones’ argument that his sentence may not exceed five years, there-
fore, falls within the terms of the mandate, and the district court prop-
erly considered the issue at resentencing.2
We are here presented with a question that requires an analysis
under the mandate rule, and upon remand, Jones pressed the district
court for a sentence that was consistent with the mandate. Given these
facts, I do not believe that Jones waived his challenge to the timeli-
ness of the government’s notification in this case. Accordingly, we
may consider it on appeal.
II.
Turning to the merits, Section 851 provides, in pertinent part:
2
One leading commentator has noted that the complex nature of the
Sentencing Guidelines often results in numerous opportunities to chal-
lenge a sentence. If a sentence is set aside on appeal, "the process of set-
ting a new sentence within the Guidelines may require—or at least
justify—reconsideration of many aspects of the original determination."
Wright et al., supra, at 763 (2002). If a court of appeals intends to control
the resentencing process, therefore, it should clearly state what is
required of the district court. Id.
UNITED STATES v. JONES 13
No person who stands convicted of an offense under this
part shall be sentenced to increased punishment by reason
of one or more prior convictions, unless before trial, or
before entry of a plea of guilty, the United States attorney
files an information with the court (and serves a copy of
such information on the person or counsel for the person)
stating in writing the previous convictions to be relied upon.
(Emphasis added). This statute provides two reference points to deter-
mine the timeliness of the government’s notice: "before trial" and "be-
fore entry of a plea of guilty." Here, the government provided notice
to Jones that it would rely upon a prior conviction after jury selection
but before the swearing of the jury. Jones contends that "before trial"
means before jury selection and that the government, in filing the
information after jury selection had begun, did not comply with the
notice requirements of § 851.
The threshold question that we must address is whether the words
"before trial," as used in § 851, are ambiguous. See United States v.
Jennings, 323 F.3d 263, 266 (2003). If they are not, we are bound to
apply the statute according to its plain terms. Id. In addressing
whether there is an ambiguity, our determination is guided "by refer-
ence to the language itself, the specific context in which that language
is used, and the broader context of the statute as a whole." Id.; see
also Davis v. Michigan Dep’t of Treasury, 489 U.S. 803, 809 (1989)
("It is a fundamental canon of statutory construction that the words
of a statute must be read in their context and with a view to their place
in the overall statutory scheme.").
The parallel phrase "before entry of a plea of guilty" provides the
proper context in which to determine the meaning of "before trial."
This language unequivocally recognizes that notice at any time prior
to a guilty plea is timely. Thus, notice given after jury selection is
timely if the defendant subsequently pleads guilty. Were we to accept
Jones’ argument that "before trial" means before jury selection, how-
ever, a striking inconsistency would result. Notice given after jury
selection would be timely if the defendant ultimately pleads guilty,
but untimely if the defendant elects to proceed to trial. There is no
basis to adopt this incongruous result. See American Tobacco Co. v.
Patterson, 456 U.S. 63, 71 (1982) (noting that statutory interpretation
14 UNITED STATES v. JONES
should "avoid untenable distinctions and unreasonable results when-
ever possible"). I therefore conclude that the terms of the statute,
when considered in their proper context, are not ambiguous and that
"before trial" means before the swearing of the jury.
Admittedly, several courts have determined that for purposes of
§ 851, "before trial" means before jury selection.3 The Eighth Circuit
was the first court of appeals to address this question. In United States
v. Johnson, that court, without addressing the text of the statute, rea-
soned that notification before jury selection "allows the defendant
ample time to determine whether he should enter a plea or go to trial,
and to plan his trial strategy with full knowledge of the consequences
of a potential guilty verdict." Johnson, 944 F.2d at 407. I respectfully
suggest that this rationale, based upon the court’s perceived policy
concerns, fails to address the statute itself. As I have explained, the
words "before trial" are not ambiguous within the context of the stat-
ute and hence, there is no need to refer to extrinsic matters, even if
one considers them to be valid policy concerns. Here, consideration
of these extrinsic concerns is not necessary because the text of the
statute is clear.
One of the cases relied upon by the dissent, United States v. Jor-
dan, 810 F.2d 262 (D.C. Cir. 1987), not only reserved a determination
as to when trial begins for purposes of § 851, but also rejected the
argument—virtually indistinguishable from the rationale advanced by
Johnson and its progeny (and Jones here)—that notice must allow for
a "calm meditation period." Id. at 269 ("[T]hat § 851(a) merely
requires that the information be filed before entry of a plea of guilty
belies any inference that it guarantees a calm meditation period.")
(internal quotation marks omitted). The court in Jordan acknowl-
edged the fundamental weakness in the general policy argument that
3
See United States v. White, 980 F.2d 836, 842 (2d Cir. 1992); Kelly
v. United States, 29 F.3d 1107, 1110 (7th Cir. 1994), overruled on other
grounds by United States v. Ceballos, 302 F.3d 679 (7th Cir. 2002);
United States v. Gonzalez-Lerma, 14 F.3d 1479, 1484 (10th Cir. 1994);
United States v. Johnson, 944 F.2d 396, 407 (8th Cir. 1991). But see
United States v. Galloway, 57 F.3d 1071, 1995 WL 329242, at **8 (6th
Cir. 1995) (holding that trial begins when jury is sworn for purposes of
§ 851).
UNITED STATES v. JONES 15
Jones urges us to adopt. While § 851 requires that the defendant
receive notice, it does not guarantee the defendant "ample time" to
develop strategy for the simple reason that notification is timely if
given at any time before a guilty plea. Jordan, therefore, supports the
approach that I take.
For the foregoing reasons, I conclude that the government provided
Jones with timely notice under 21 U.S.C. § 851. Accordingly, I would
affirm the judgment of the district court.
MICHAEL, Circuit Judge, dissenting:
When Jones appealed the first time, we vacated his 17 1/2-year
prison sentence and remanded for resentencing "in accordance with
the statutory maximum for the least-punished object of the [drug]
conspiracy (distribution of marijuana)." United States v. Jones, 17
Fed. Appx. 240, 250 (4th Cir. 2001) (unpublished) (Jones I). At
resentencing Jones was subject to a maximum prison term of five
years or, if the government gave proper notice of its intent to rely on
his prior felony drug conviction, ten years. See 21 U.S.C.
§§ 841(b)(1)(D); id. § 851. The district court resentenced Jones to a
ten-year term of imprisonment, and our court affirms. I respectfully
dissent. The government did not file its § 851 notice "before trial" as
the statute requires. Rather, it waited until after jury selection was
under way to notify Jones that it intended to use his prior drug convic-
tion to enhance his sentence. Jones objected to the late filing at resen-
tencing, and he had not previously waived his right to object. Because
the § 851 notice was late, I would vacate Jones’s sentence once again
and remand for him to be resentenced in accordance with the five-
year statutory maximum.
I.
Section 851(a), the notice provision, reads: "No person who stands
convicted of an offense under this part shall be sentenced to increased
punishment by reason of one or more prior convictions, unless before
trial . . . the United States attorney files an information with the court
(and serves a copy of such information on the person or counsel for
the person) stating in writing the previous convictions to be relied
upon." 21 U.S.C. § 851(a) (emphasis added). The purpose of § 851’s
16 UNITED STATES v. JONES
notice requirement is to give a defendant ample time to decide
whether to plead guilty or go to trial. If he chooses trial, he does so
with full knowledge of the potential sentencing consequences of a
guilty verdict. See United States v. Johnson, 944 F.2d 396, 407 (8th
Cir. 1991).
It is true that Jones did not raise any argument about the late filing
of the § 851 information at his initial sentencing or in his initial
appeal. And it is true, as Judge Williams points out, that an issue not
raised on a first appeal is generally considered to be waived (or more
accurately, forfeited). Ante at 7. But an issue is not waived if the
defendant did not "have both an opportunity and an incentive to raise
it before the sentencing court or on appeal." United States v. Quin-
tieri, 306 F.3d 1217, 1229 (2d Cir. 2002) (emphasis added). Simply
put, a "‘defendant should not be held to have waived [a sentencing]
issue if he did not have a reason to raise it at his original sentencing.’"
United States v. Ticchiarelli, 171 F.3d 24, 32 (1st Cir. 1999) (quoting
United States v. Whren, 111 F.3d 956, 960 (D.C. Cir. 1997)). Cf.
United States v. Jennings, 83 F.3d 145, 151 (6th Cir.), amended by
96 F.3d 799 (6th Cir. 1996) (allowing de novo sentencing after
remand); United States v. Atehortva, 69 F.3d 679, 685 (2d Cir. 1995)
(same). The determination of whether a defendant had a sufficient
incentive to raise an issue in earlier proceedings requires a "fact-
intensive, case-by-case analysis." Tichiarelli, 171 F.3d at 33.
The record in this case amply demonstrates why Jones had no rea-
son to raise the § 851 issue during his first sentencing and appeal. At
trial the district court rejected Jones’s request for a special verdict
form that would have allowed the jury to specify whether it was con-
victing him and his co-defendants of a heroin conspiracy, a marijuana
conspiracy, or both. As a result, the jury returned a general verdict
that did not specify drug type. At Jones’s initial sentencing, the dis-
trict court sentenced him for conspiracy involving heroin. After con-
cluding that at least 100 grams of heroin were sold, and adding points
for Jones’s distribution of drugs in a detention facility, for his obstruc-
tion of justice, and for his role in the conspiracy, the district court sen-
tenced Jones to 210 months imprisonment, or 17 1/2 years. See
United States v. Jones, No. WMN-98-048, Sentencing Tr. at 77-98
(D. Md. Sept. 22, 1999). Section 841(b)(1)(B) of Title 21 subjects a
defendant involved in the distribution of 100 grams or more of heroin
UNITED STATES v. JONES 17
to a minimum prison term of five years; if the defendant has a prior
felony drug conviction, he is subject to a statutory enhancement that
raises the minimum prison term to ten years, assuming the govern-
ment complies with the requirements of § 851. At Jones’s original
sentencing, the routine calculations under the sentencing guidelines
allowed the district court to sentence Jones to 17 1/2 years in prison;
thus, the question of enhancing the five-year minimum to a ten-year
minimum did not come up. The court, in other words, used the guide-
lines to sentence Jones to more than ten years, and the government
therefore did not need to rely upon Jones’s prior felony drug convic-
tion to raise the five-year minimum to ten years. As a result, Jones
had no reason to contest the untimely filing of the § 851 information
at his original sentencing. See Ticchiarelli, 171 F.3d at 33 ("[W]aiver
doctrine does not require that a defendant . . . raise every objection
that might have been relevant if the district court had not already
rejected the defendant’s arguments."). The § 851 issue was simply not
in play when Jones was sentenced the first time, and he could not
have been expected to raise the issue "in anticipation of the possibility
that, upon remand, [it] might be relevant." Jennings, 83 F.3d at 151.
Judge Williams nonetheless contends that the § 851 issue was rele-
vant at Jones’s first sentencing. Ante at 9-10. She is correct that the
presentence report used in Jones’s initial sentencing "note[d] that the
government filed notice that the defendant is a second offender." J.A.
189. The question, however, is whether the § 851 notice came into
play at the first sentencing. It did not. The government did not rely
on or even mention the § 851 enhancement because the district court
sentenced Jones, based on the heroin conspiracy, to a term of impris-
onment that exceeded the enhanced ten-year minimum. As a result,
there was simply no reason for Jones to object to the untimeliness of
the § 851 notice at the first sentencing. It is also correct, as Judge Wil-
liams notes, ante at 10, that Jones’s lawyer at his first sentencing
referred to the government’s filing of "a notice of subsequent
offender," which would "double the penalty, and [Jones] would be
exposed to ten years." J.A. 101. That comment was made in passing
shortly before the district court once again rejected (as it had at trial)
Jones’s argument that the use of a general verdict was in error. See
United States v. Jones, No. WMN-98-048, Sentencing Tr. at 9-16 (D.
Md. Sept. 22, 1999). At Jones’s second sentencing, the district court
specifically found that this comment by Jones’s lawyer at his first
18 UNITED STATES v. JONES
sentencing did not amount to a waiver of Jones’s right to challenge
the untimely § 851 filing. J.A. 120. The district court was correct on
this point. Finally, Judge Williams suggests that "a five-year manda-
tory maximum would certainly have been relevant" at Jones’s original
sentencing. Ante at 7 n.3. But as our decision in Jones I makes clear,
see infra, the prospect of a five-year mandatory maximum for Jones
arose only after our decision in Rhynes and the Supreme Court’s deci-
sion in Apprendi, both of which were decided after Jones’s initial sen-
tencing. Jones could not have been expected at his initial sentencing
to raise an issue that was not on the radar screen and was made rele-
vant only by our decision on appeal. See Whren, 111 F.3d at 960
(concluding that "a defendant may argue at resentencing that the court
of appeals’ decision has breathed life into a previously dormant
issue").
Because Jones had no reason to raise the § 851 issue at his original
sentencing, it follows that he had no reason to raise it in his initial
appeal. In fact, the government concedes that Jones did not raise the
issue in his first appeal because "[s]imply stated, it was not at issue."
Appellee’s Br. at 12. Rather, in his first appeal Jones argued that the
district court erred in using a general verdict form. He also argued
that the court’s factual findings on drug quantity violated Apprendi v.
New Jersey, 530 U.S. 466 (2000). See Jones I, 17 Fed. Appx. at 244.
In light of our opinion in United States v. Rhynes, 196 F.3d 207, 238-
40 (4th Cir. 1999), we agreed with Jones that the district court erred
in using a general verdict form that did not distinguish between the
marijuana and heroin conspiracies. The government, in fact, conceded
the error and chose "the option of having Jones resentenced for con-
spiracy to distribute marijuana instead of retrying him." Jones I, 17
Fed. Appx. at 245. As to Jones’s Apprendi argument, we agreed that
"[t]he statutory maximum sentence for conspiracy to distribute mari-
juana without a jury finding of a specific threshold quantity of mari-
juana is five years imprisonment; the maximum sentence is ten years
imprisonment if the defendant has a prior felony drug conviction." Id.
at 248. Accordingly, we vacated Jones’s sentence and remanded "for
resentencing in accordance with the statutory maximum for the least-
punished object of the conspiracy (distribution of marijuana)." Id. at
250. "Because the scope of our remand order reasonably encompasses
those matters relevant to determining the appropriate [statutory maxi-
mum]," consideration of the § 851 issue at Jones’s resentencing was
UNITED STATES v. JONES 19
entirely appropriate. United States v. Henoud, 81 F.3d 484, 487 n.8
(4th Cir. 1996). Cf. United States v. Husband, 312 F.3d 247, 250 (7th
Cir. 2002) ("[T]his court does not remand issues to the district court
when those issues have been waived or decided."). Thus, Jones was
free to argue at his resentencing, as he did, that in his case the statu-
tory maximum for the marijuana conspiracy was five years. I recog-
nize that our Jones I opinion mentioned in passing that "[t]he
government filed an information indicating that Jones has at least one
prior felony drug conviction," Jones I, 17 Fed. Appx. at 245, but we
did not decide whether the § 851 information had been filed and
served on a timely basis.
In sum, because Jones did not have any reason to raise the § 851
issue either at his first sentencing or in his first appeal, he did not
waive the issue and therefore could raise it at his resentencing.
II.
Because Jones did not waive his right to object to the timeliness of
the § 851 filing, I would consider the merits of this issue. The govern-
ment filed the § 851 information after jury selection began, but before
the jury was sworn. The district court concluded that its "best guess
as to what the Fourth Circuit would conclude, is that what ‘before
trial’ means in the context of this particular statute, means that in this
particular case, filing and serving this notice before the jury was
sworn, satisfies the statute. Whether that may be true in every situa-
tion is difficult to say." J.A. 121. The court went on to say that Jones
was aware of his prior conviction and that he suffered no prejudice
by being served with notice after jury selection began. The meaning
of "before trial" should not vary from case to case. We should choose
one of two alternatives: before jury selection begins or before the jury
is sworn. I would adopt the prevailing view and hold that "before
trial" means before jury selection begins.
"[E]very court of appeals to have addressed this question [in a pub-
lished opinion] has concluded that before trial means before jury
selection begins (which is obviously also before the jury is sworn)."
Kelly v. United States, 29 F.3d 1107, 1110 (7th Cir. 1994), overruled
on other grounds by United States v. Ceballos, 302 F.2d 679 (7th Cir.
2002). See also United States v. Gonzalez-Lerma, 14 F.3d 1479, 1484
20 UNITED STATES v. JONES
(10th Cir. 1994); United States v. White, 980 F.2d 836, 842 (2d Cir.
1992); Johnson, 944 F.2d at 407; United States v. Weaver, 905 F.2d
1466, 1481 (11th Cir. 1990); United States v. Jordan, 810 F.2d 262,
268-69 (D.C. Cir. 1987). But see United States v. Galloway, 57 F.3d
1071, 1995 WL 329242, at *8 (6th Cir. May 31, 1995) (unpublished)
(concluding that "trial did not begin until the jury was sworn"). In
Johnson the Eighth Circuit gave thorough consideration to the issue
that Jones raises here — whether a § 851 notice is timely if it is filed
after jury selection begins but before the jury is sworn. The Johnson
court concluded that "section 851 requires filing before jury selection
begins." Johnson, 944 F.2d at 407. This interpretation was necessary,
the court said, to "allow[ ] the defendant ample time to determine
whether he should enter a plea or go to trial, and to plan his trial strat-
egy with full knowledge of the consequences of a potential guilty ver-
dict." Id. Cf. United States v. Ferebe, 332 F.3d 722, 733 (4th Cir.
2003) (indicating that for purposes of 18 U.S.C. § 3593(a)’s death
notice requirement, "before trial" means before "the judge gavel[s] the
trial’s voir dire to a start"). I agree and would adopt the rule followed
by the Eighth Circuit (and at least five others) that before trial means
before jury selection begins.
Judge Shedd argues that the interpretation of § 851 that I and many
circuits adopt leads to "a striking inconsistency." Ante at 13. Accord-
ing to Judge Shedd, "notice given after jury selection would be timely
if the defendant ultimately pleads guilty, but untimely if the defendant
elects to proceed to trial." Id. I do not see a striking inconsistency
here. Once a defendant decides to plead guilty, he no longer has the
need "to plan his trial strategy with full knowledge of the conse-
quences of a potential guilty verdict." Johnson, 944 F.2d at 407. Spe-
cifically, if a defendant pleads guilty after jury selection, any damage
to his trial strategy caused by the government’s untimely § 851 filing
is no longer of consequence. However, if he continues with his trial,
any damage done by the untimely filing is likely to remain.
Because the government here did not file the § 851 information
before jury selection began, the district court was without authority
to sentence Jones to double time (ten years) for the marijuana conspir-
acy conviction. See Ceballos, 302 F.3d at 691 (recognizing that "the
government’s failure to satisfy the requirements of § 851(a) deprives
the district court of authority . . . to impose an enhanced sentence due
UNITED STATES v. JONES 21
to prior convictions"); see also Weaver, 905 F.2d at 1481 ("Even
when the defendant is not surprised by the enhanced sentence, was
aware from the outset that his previous conviction could lead to an
enhanced sentence, never challenged the validity of the prior convic-
tion, and admitted it at the sentencing hearing, the statute prohibits an
enhanced sentence unless the government first seeks it by properly fil-
ing an information prior to trial.") (emphasis added). Thus, the maxi-
mum prison sentence that Jones should face for the marijuana
conspiracy is five years. I would therefore vacate his ten-year prison
term and remand for the imposition of a sentence in accordance with
the five-year statutory maximum. | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/591474/ | 976 F.2d 608
UNITED STATES of America, Plaintiff-Appellee,v.Winona CHIMAL, Defendant-Appellant.
No. 91-2223.
United States Court of Appeals,Tenth Circuit.
Sept. 24, 1992.
Ralph C. Binford, Deming, N.M., for defendant-appellant.
Robert J. Gorence, Asst. U.S. Atty. (Don J. Svet, U.S. Atty., with him on the brief), Albuquerque, N.M., for plaintiff-appellee.
Before BALDOCK, SETH and KELLY, Circuit Judges.
BALDOCK, Circuit Judge.
1
Defendant-appellant Winona Chimal was charged with eleven counts of embezzlement from an Indian tribe. 18 U.S.C. § 1163. She was convicted on two counts, acquitted on one count, and the district court declared a mistrial on the remaining counts because the jury could not agree. Defendant appeals, raising the following points of error: (1) the government failed to prove a corpus delicti; (2) the trial court erred in allowing the prosecutor to impeach Defendant with her pre-arrest silence; (3) the prosecutor's alleged misstatement of the law of double jeopardy during closing argument resulted in a conviction on improper grounds; (4) the district court erred in failing to grant a two-level reduction for acceptance of responsibility, U.S.S.G. § 3E1.1(a); (5) the district court erred in giving a two-level increase for more than minimal planning, U.S.S.G. § 2B1.1(b)(5); and (6) the district court erred in giving a two-level increase for Defendant's abuse of a position of trust, U.S.S.G. § 3B1.3. This court has jurisdiction under 28 U.S.C. § 1291 and 18 U.S.C. § 3742, and finding no error we affirm.
2
Defendant was employed as comptroller for the Inn of the Mountain Gods (the Inn), a resort near Ruidoso, New Mexico, which is wholly owned and operated by the Mescalero Apache Tribe. Defendant's duties included receipt of vendors checks, billing and receiving payment from groups who stayed at the Inn, overseeing others employed in the accounting office, and occasionally cashing checks for Inn guests. Defendant's normal duties did not include filling out deposit slips, but she did so occasionally.
3
Two coworkers, who worked in the accounting department under Defendant, became aware that Defendant was altering deposit slips. Defendant would add a check to the deposit ticket and remove an equivalent amount in cash, thus keeping the total amount of the deposit the same. Most of these substitutions involved commission checks that the Inn received from vending machine contractors. Defendant never recorded the receipt of the commission checks in the daily deposit log. When the coworkers confronted Defendant about altering the deposit slips, she acknowledged she had changed the deposit slips but stated she had done so in order to cash a check for someone because there was not enough cash in the safe. Both coworkers testified that the defendant often carried large amounts of cash at work.
4
During an internal investigation by the Inn, the Mescalero tribe's attorney questioned Defendant in front of a number of tribal officials, and Defendant offered no explanation for the altered deposit slips and missing cash. Later, when questioned at her home by a Federal Bureau of Investigation (FBI) agent, Defendant admitted that she had embezzled from the Inn on two specific occasions by exchanging vendors checks for cash in deposit tickets. The facts surrounding these two occasions later formed indictment Counts II and IX for which she was convicted.1 Defendant's story at trial was different from what the FBI agent said she said. She denied stealing any money using the check for cash exchange method. Defendant claimed that she had substituted the checks for cash but had immediately put the cash in the Inn's safe.2 However, the Inn's accountant testified that he did not find the cash in the safe or in any bank account.
I.
5
It would appear that Defendant's conviction was based primarily on her confession to the FBI agent. Other than Defendant's confession, only circumstantial evidence pointed to her guilt. There was no direct evidence of her guilt, and no cash was found in her home or on her person. Defendant argues that the government failed to prove a corpus delicti independent of her confession.
6
Corpus delicti is a common law concept literally translated as "the body of the crime." Black's Law Dictionary 310 (5th ed. 1979). Every crime has three component parts--(1) the occurrence of the specific kind of injury or loss (e.g., homicide, a dead person; larceny, property missing), (2) criminality as the source of the loss, and (3) the accused's identity as the perpetrator. United States v. Shunk, 881 F.2d 917, 918 (10th Cir.1989). The first two of these elements constitute the concept of corpus delicti--i.e., proof that a crime was committed and that someone, not necessarily the accused, committed it. Id. at 919. In Defendant's case, proof of the corpus delicti would be proof that the money was missing as the result of an employee's criminal activity.
7
At one time, several courts held that evidence independent of an extrajudicial confession must establish the corpus delicti. See, e.g., United States v. Fenwick, 177 F.2d 488, 489-90 (7th Cir.1949); Ercoli v. United States, 131 F.2d 354, 357 (D.C.Cir.1942); Pines v. United States, 123 F.2d 825, 829-30 (8th Cir.1942). However, in Opper v. United States, 348 U.S. 84, 75 S.Ct. 158, 99 L.Ed. 101 (1954), the Supreme Court rejected the requirement that the corpus delicti be established with independent proof. Id. at 93, 75 S.Ct. at 164. Rather, the evidence merely must tend to establish the trustworthiness of the confession. Id.
8
A criminal conviction cannot be sustained when the offense is proven solely by an uncorroborated extrajudicial confession. Smith v. United States, 348 U.S. 147, 152, 75 S.Ct. 194, 197, 99 L.Ed. 192 (1954). The corroborating evidence is adequate if it "supports the essential facts admitted sufficiently to justify a jury inference of the truth" of the confession. Opper, 348 U.S. at 93, 75 S.Ct. at 164. See also Sells v. United States, 262 F.2d 815, 820 (10th Cir.1958), cert. denied, 360 U.S. 913, 79 S.Ct. 1298, 3 L.Ed.2d 1262 (1959). The quantity and type of independent evidence depend upon the facts of each case. Opper, 348 U.S. at 93, 75 S.Ct. at 164. See also United States v. Henderson, 467 F.2d 904, 906 (10th Cir.1972). Circumstantial evidence can be used to corroborate a confession. See Cordoba v. Hanrahan, 910 F.2d 691 (10th Cir.), cert. denied, --- U.S. ----, 111 S.Ct. 585, 112 L.Ed.2d 590 (1990).
9
Our review of the record leads us to conclude that the evidence sufficiently corroborates Defendant's extrajudicial confession. Direct testimony from Defendant's coworkers indicated that she altered deposit slips and substituted vendor checks for cash. Testimony from the Inn's accountant indicated that Defendant had failed to record the vendor checks in the deposit log and that the cash taken from the deposits never appeared in the Inn's bank account or in the safe. Defendant was often observed by coworkers to carry large amounts of cash at work. This testimony sufficiently establishes the trustworthiness of Defendant's confession.
10
Once a court determines that evidence exists to corroborate the trustworthiness of the confession, the evidence as a whole must be sufficient to support a finding of guilt beyond a reasonable doubt. Martinez v. United States, 295 F.2d 426 (10th Cir.1961). In reviewing the sufficiency of the evidence, we must view the evidence in the light most favorable to the prosecution and determine whether any rational trier of fact could have found the essential elements beyond a reasonable doubt. Jackson v. Virginia, 443 U.S. 307, 99 S.Ct. 2781, 61 L.Ed.2d 560 (1979). After reviewing the evidence in this case, which consisted of Defendant's confession and the evidence corroborating her confession, we hold that the prosecution presented ample evidence from which the jury could have found Defendant guilty of embezzlement as to Counts II and IX beyond a reasonable doubt.
II.
11
Defendant next argues that the trial court erred in allowing the prosecutor to impeach Defendant with her silence during the Inn's internal investigation. At trial, Defendant testified that she had substituted the checks for cash but had immediately put the cash in the Inn's safe. On cross-examination, the district court permitted the prosecutor to ask Defendant why she did not offer this explanation to Tribal officials and the Tribe's attorney during the internal investigation.3 Defendant argues that her failure to offer an explanation before the tribal leaders and the tribe's attorney was an exercise of her Fifth Amendment right to remain silent and therefore an improper basis for impeachment. See Doyle v. Ohio, 426 U.S. 610, 619, 96 S.Ct. 2240, 2245, 49 L.Ed.2d 91 (1976) (prosecutor may not impeach defendant on his silence after defendant was in custody and had been read his Miranda rights); United States v. Burson, 952 F.2d 1196, 1201 (10th Cir.1991), cert. denied, --- U.S. ---- 112 S.Ct. 1702, 118 L.Ed.2d 411 (1992) (prosecutor may not address in case-in-chief defendant's pre-arrest refusal to speak to government criminal investigators).
12
It is well-established that a prosecutor may use a defendant's pre-arrest silence to impeach the defendant's credibility. Jenkins v. Anderson, 447 U.S. 231, 238-40, 100 S.Ct. 2124, 2129-30, 65 L.Ed.2d 86 (1980). See also Burson, 952 F.2d at 1201 (acknowledging that although general rule of law is that once defendant invokes his right to remain silent it is impermissible for prosecution to refer to that silence, there are exceptions to this rule such as use of silence for impeachment in certain circumstances). In Jenkins, a murder defendant turned himself in to governmental authorities two weeks after the fatal stabbing. The defendant testified at trial that he acted in self-defense. On cross-examination, the prosecutor asked the defendant why he did not wait for the police to arrive after the stabbing so that he could tell them that he had acted in self-defense and why he did not report the self-defense stabbing for two weeks. The Supreme Court found no error holding that the use of pre-arrest silence to impeach a defendant's credibility did not violate the Constitution because the "impeachment follows the defendant's own decision to cast aside his cloak of silence." Id. 447 U.S. at 238, 100 S.Ct. at 2129.
13
While the Court in Doyle held that a prosecutor cannot impeach a defendant with his silence invoked during a custodial interrogation, 426 U.S. at 619, 96 S.Ct. at 2245, Defendant Chimal was not in custody. Burson is also inapposite because the prosecutor did not bring up Defendant's silence during his case-in-chief. Rather, Defendant's non-custodial pre-arrest silence was admitted solely for impeachment. Accordingly, Jenkins controls, and we find no error.
III.
14
Defendant next argues that the prosecutor misstated the law of double jeopardy during closing argument resulting in her conviction on improper grounds. The prosecutor's statement was in response to defense counsel's statement in closing that Defendant was not charged with the embezzlement that she committed. The objectionable argument by the prosecutor was prompted by the following argument by defense counsel in closing:
15
And she finally admitted after questioning, yes, she had been doing that [taking cash in small increments from the safe]. But that's not what she was indicted for. That's not what we're in this lawsuit about. That's not what this indictment--you're going to get a copy. That's not what this is all about. They didn't charge her with that. They could and they can. But that's not what--she's admitted to that. But that's not what she's charged with.
16
Tr. 281. See also supra note 2. According to defense counsel's closing, Defendant had only embezzled small amounts of cash from the safe; whereas, the indictment charged embezzlement by exchanging checks for cash in deposit tickets.4 Defendant contends that the prosecutor's closing implied that if the jury acquitted Defendant on the embezzlement counts charged in the indictment, Defendant could not be retried later for embezzlements she may have committed by taking money in small increments directly from the safe. Defendant discerns this meaning from the following statement by prosecutor:
17
Lastly Mr. Binford [defense counsel] made the statement that she is an embezzler, but you didn't charge her, therefore acquit her of all 11 counts. And, quote, the Government can still charge her. That's an incorrect statement as well. If you believe her, acquit her. But if you don't believe her, return a verdict of guilty on the 11 counts. Because that's really what this trial is all about. And when Mr. Binford gets up and says it can be done again or redo it later on, that's not correct. The decision is binding.
18
Tr. 296. We do not characterize the prosecutor's statement in closing in the same light as Defendant. It seems to us that the prosecutor merely asked the jury to review the evidence presented at trial regarding the instances of embezzlement charged in the indictment. Then, the prosecutor requested that the jury return a verdict of guilty if they believed the evidence, because the government could not retry Defendant for those specific instances of embezzlement after Defendant was acquitted. Because we reject Defendant's characterization of the prosecutor's statement, we decline to address whether Defendant's characterization of the prosecutor's statement was an improper statement of the law.
IV.
19
In regard to sentencing, Defendant contends that the trial court erred in failing to grant a two level reduction for acceptance of responsibility. U.S.S.G. § 3E1.1(a). An acceptance of responsibility determination by a district court is a question of fact reviewable under a clearly erroneous standard. United States v. Spedalieri, 910 F.2d 707, 712 (10th Cir.1990). The burden of proof is on the defendant and the quantum of proof is by a preponderance of the evidence. Id. Whether a defendant should be granted a two level adjustment for acceptance of responsibility depends upon whether a defendant "clearly demonstrates a recognition and affirmative acceptance of personal responsibility for his criminal conduct." U.S.S.G. § 3E.1(a). Defendant denied any criminal wrongdoing relating to the counts charged in the indictment at trial, and she persisted in this denial following her conviction during her presentence interview. Therefore, the district court's failure to award a two level downward adjustment was not clearly erroneous.
V.
20
Defendant next argues that the trial court erred in giving a two level increase for more than minimal planning. U.S.S.G. § 2B1.1(b)(5). We review this factual determination for clear error. United States v. Williams, 966 F.2d 555, 558 (10th Cir.1992) (citations omitted). More than minimal planning is defined as "significant affirmative steps ... taken to conceal the offense.... [or] repeated acts over a period of time, unless it is clear that each instance was purely opportune." U.S.S.G. § 1B1.1, comment (n.1(f)). "In an embezzlement, a single taking accomplished by a false book entry would constitute only minimal planning. On the other hand, ... several instances of taking money, each accompanied by false entries [would constitute more than minimal planning]." Id. See also Williams, 966 F.2d at 558.
21
Defendant Chimal had access to the checks and concealed them until the time was right to make the switch for cash on the deposit slips. These actions involved repeated acts and required planning over an extended period of time. See United States v. Lee, 973 F.2d 832, 833 (10th Cir.1992) (sentencing level increase for more than minimal planning appropriate when defendant, who was customer service officer at bank, helped customers fill out deposit slips on six occasions and deposited funds in her own account); Williams, 966 F.2d at 558 (sentencing level increase for more than minimal planning was appropriate when embezzlements transpired over period of six months and involved numerous computer entries). Accordingly, the trial court's finding was not clearly erroneous.
VI.
22
Finally, Defendant argues that the trial court erred in giving a two level increase for Defendant's abuse of a position of trust. U.S.S.G. § 3B1.3. We review for clear error. United States v. Williams, 966 F.2d 555, 556 (10th Cir.1992).
23
The adjustment for abuse of a position of trust may not be employed when the elements of the underlying offense include abuse of trust. U.S.S.G. § 3B1.3. Although embezzlement by definition involves an abuse of trust,5 embezzlement by someone in a significant position of trust warrants the enhancement when the position of trust substantially facilitated the commission or concealment of the crime. Id.; Williams, 966 F.2d at 556. An ordinary bank teller, who steals from the till and adjusts the records, is not subject to the abuse of trust enhancement because the job is not considered a position of trust. U.S.S.G. § 3B1.3, comment (n.1). Unlike a bank teller, Defendant as comptroller held a position of trust. She essentially had complete control over the accounting department and rarely had to report her activities to a superior. See United States v. Lieberman, 971 F.2d 989, 991 (3d Cir.1992) (bank vice president with authority to balance the bank suspense account, who was not regularly supervised and who was able to conduct thirty-six transactions over four years without being caught, held a position of trust); United States v. Milligan, 958 F.2d 345, 347 (11th Cir.1992) (infrequent monitoring and infrequent audits placed postal window clerk in position of trust); United States v. Ajiboye, 961 F.2d 892, 895 (9th Cir.1992) (freedom from surveillance while delivering the mail and lack of accounting for particular pieces of mail placed postal carrier in position of trust); United States v. Hill, 915 F.2d 502, 505-07 (9th Cir.1990) (truck driver entrusted to carry family belongings half way across country for transport oversees and not subject to surveillance or frequent audit placed him in position of trust). But see United States v. Helton, 953 F.2d 867, 869 (4th Cir.1992) (defendant did not hold a position of trust because lack of supervision and delay in detection resulted from supervisors who were inept, sloppy and derelict in their duty).
24
Defendant's position of trust substantially facilitated her crime. Williams, 966 F.2d at 556. In Williams, we held that a military pay account technician who embezzled from an Air Force finance center held a position of trust which substantially facilitated his crime because his access to individual accounts which he personally audited enabled him to uniquely circumvent the finance center's system of checks and balances designed to guard against embezzlement. Id. at 558. A number of circuits have based the two level increase for abuse of trust on the ability to avoid detection. See United States v. Ehrlich, 902 F.2d 327 (5th Cir.1990), cert. denied, --- U.S. ----, 111 S.Ct. 788, 112 L.Ed.2d 851 (1991) (other bank employees could have executed same embezzlement scheme as defendant, but defendant's position of trust which gave her authority to routinely balance her own loan transactions facilitated her embezzlements); United States v. McMillen, 917 F.2d 773 (3d Cir.1990) (defendant's authority to approve loan applications, issue savings certificates and sign bank documents without supervisory approval facilitated concealment of crime and constituted abuse of trust). Similarly, Defendant had complete access to the vendor checks and her position enabled her to alter deposit slips without arousing suspicion. Perhaps, other accounting department employees could have obtained the vendor checks and switched them for cash in the deposits, but only Defendant, as comptroller and supervisor of the accounting department, had the ability to avoid detection over a long period of time. Defendant's position did not merely provide an opportunity which could as easily have been afforded to other persons. Williams, 966 F.2d at 556. Therefore, the district court's determination that Defendant abused her position of trust was not clearly erroneous.
25
AFFIRMED.
1
The FBI agent testified as follows regarding Defendant's confession to Counts II and IX:
Q: What about Count 2? That relates to the deposit slip that she alone prepared with the addition of Southwest Coke check for $431.
A: She advised on that one she had placed the Southwest Coke check in the deposit, taken out the cash and kept it for herself.
Q: She admitted that one?
A: Yes, she did.
Q: Count 9, which was the addition of two Bordens checks for $276 and $84 on a changed deposit ticket from Ms. Palmer. What did Ms. Chimal say about that?
A: It was on that count she advised me she probably did take those Bordens checks because she liked to take any checks from Borden.
Tr. 174, 177.
2
Defendant did admit at trial that she had taken approximately $1,500 over time from the Inn's safe in small $20.00 increments; however, these thefts were not charged in the indictment
3
During the government's case-in-chief, the district court did not allow the prosecutor to question the Tribe's attorney about Defendant's lack of explanation to tribal officials. The district court recognized that the tribal officials were similar to government agents, and thus the questioning might be prohibited by United States v. Burson, 952 F.2d 1196, 1201 (10th Cir.1991), cert. denied, --- U.S. ----, 112 S.Ct. 1702, 118 L.Ed.2d 411 (1992)
4
The indictment, however, did not outline Defendant's specific means of embezzlement--only the evidence at trial outlined Defendant's check-for-cash-exchange means of embezzlement. See n. 1
5
Embezzlement involves "the fraudulent appropriation to his own use or benefit, of property or money entrusted to [an individual] by another, by a clerk, agent, trustee, public officer, or other person acting in a fiduciary character." United States v. Christiansen, 958 F.2d 285, 287 (9th Cir.1992) (citing Black's Law Dictionary 614 (rev. 4th ed. 1968)) | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1011309/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4066
FRANCEYN SECOR,
Defendant-Appellant.
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4069
WILLIAM J. DOUGHERTY, JR.,
Defendant-Appellant.
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4195
JOHN L. BLANCHARD,
Defendant-Appellant.
Appeals from the United States District Court
for the Eastern District of Virginia, at Newport News.
Raymond A. Jackson, District Judge.
(CR-01-47)
Argued: April 4, 2003
Decided: August 11, 2003
Before WILKINS, Chief Judge, and TRAXLER and
GREGORY, Circuit Judges.
2 UNITED STATES v. SECOR
Affirmed by unpublished per curiam opinion.
COUNSEL
ARGUED: David Glenn Barger, WILLIAMS MULLEN, P.C.,
McLean, Virginia, for Appellant Dougherty; Thomas W. Carpenter,
THOMAS W. CARPENTER, P.C., Newport News, Virginia, for
Appellant Secor; Stephen John Weisbrod, WEISBROD & PHILLIPS,
P.C., Hampton, Virginia, for Appellant Blanchard. Raymond Edward
Patricco, Jr., Assistant United States Attorney, Alexandria, Virginia,
for Appellee. ON BRIEF: Edward W. Wolcott, Jr., Samuel W.
Meekins, Jr., WOLCOTT, RIVERS, WHEARY, BASNIGHT &
KELLY, P.C., Virginia Beach, Virginia, for Appellant Dougherty.
Paul J. McNulty, United States Attorney, Alexandria, Virginia; Rob-
ert J. Seidel, Jr., Assistant United States Attorney, Norfolk, Virginia,
for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
In this consolidated appeal, Franceyn Secor ("Secor"), John Blan-
chard ("Blanchard"), and William Dougherty ("Dougherty") challenge
their convictions and sentences resulting from charges that they
attempted to conceal Blanchard’s income from the Internal Revenue
Service ("IRS") in violation of several provisions of the Internal Rev-
enue Code (the "Code"). Separately, Secor and Dougherty also chal-
lenge the validity of several of the district court’s evidentiary rulings
and its refusal to give certain jury instructions. For the following rea-
sons, we find that their challenges lack merit and therefore affirm the
judgment below.
UNITED STATES v. SECOR 3
I.
In 1989, Franceyn Secor and John Blanchard married and moved
from New York to Williamsburg, Virginia, where Blanchard began
working as a commissioned salesperson for Berryman Chemicals.
Blanchard requested that Bob Berryman, the President of Berryman
Chemicals, direct deposit his commission payments into Secor’s bank
account in Buffalo, New York. The government alleges that Blan-
chard made this request in order to evade payment of an existing tax
liability to the IRS dating back to the early 1980s.
Shortly after moving to Virginia, Blanchard and Secor hired Wil-
liam Dougherty, a tax attorney and certified public accountant
("CPA"), to assist them with various tax-related matters. The forma-
tion of this business relationship would ultimately lead to the underly-
ing prosecution. Blanchard, Secor, and Dougherty would become the
brain trust behind the fraudulent tax scheme at issue. Dougherty’s role
in this scheme was both to assist Blanchard in avoiding his existing
tax liability and to limit Secor’s tax liability. To accomplish these
objectives, Dougherty prepared and filed false tax returns on behalf
of Blanchard and Secor throughout the early and mid-1990s. These
tax returns falsely indicated that Secor earned income from Berryman
Chemicals. In fact, Secor had never been employed by Berryman
Chemicals but was instead employed by a local real estate company
in Virginia.
In May 2001, a grand jury indicted Secor, Blanchard, and Dou-
gherty on charges that they: (1) conspired to defraud the United States
in violation of 18 U.S.C. § 371 (Count 1); (2) evaded payment of a
tax liability in violation of 26 U.S.C. § 7201 (Counts 2-6); (3)
attempted to evade tax payments in violation of 26 U.S.C. § 7201;
(Counts 7-11); (4) made a false statement to the IRS in violation of
26 U.S.C. § 7206(1) (Count 12) and 18 U.S.C. § 1001 (Count 13);
and (5) aided and abetted in the preparation of false tax returns in vio-
lation of 26 U.S.C. § 7206(2) (Counts 14-21).
During the course of a two-week trial in October 2001, the govern-
ment tried its case against Secor, Blanchard, and Dougherty. The gov-
ernment offered testimonial and documentary evidence to
demonstrate the existence of a scheme to avoid paying Blanchard’s
4 UNITED STATES v. SECOR
tax liability. First, the government offered Bob Berryman’s testimony
that Secor had never worked for his company, a fact which Blanchard
affirmed when he testified in his own defense.1 Second, the govern-
ment proffered Dougherty’s notes from meetings with Blanchard and
Secor, which documented his advice to the couple to prepare their
taxes in a manner that would permit Secor to evade tax liability and
conceal Blanchard’s ability to satisfy his existing tax liability. For
example, in October 1991, Dougherty noted that "in order to keep
[Secor] clear of [the] IRS," he would need to "redo[ ] [Secor’s] 1040s
showing all income to [Blanchard]" and that "[p]erhaps [B]lanchard
should file, all income to him, MFS (‘married filing single’) for
[19]89 and [19]90 — then wait two years — and go bankrupt." Addi-
tionally, in a February 5, 1996 letter to Blanchard, Dougherty wrote,
"Do you need to rehide this money?" "I don’t like the IRS having
photocopies of all the financial activity — but know of no way to (a)
suppress the date, not (b) delay any further."
Third, the government called IRS Agent Munn, who testified that:
(1) each time the IRS attempted to levy one of Blanchard’s accounts,
he and Secor would open a new account in Secor’s name and have
his commission payments from Berryman Chemicals deposited into
the new account; (2) Dougherty and Blanchard delayed the IRS’s
investigation of Blanchard by requesting numerous time extensions,
failing to appear at scheduled appointments, and failing to bring the
requested information with them when they did appear for the
appointments; (3) the IRS’s investigation of Blanchard revealed that
from 1995 to 1998, Secor claimed on her tax filings to earn $542,232
from Berryman Chemicals, which was actually income that was
earned by Blanchard; and (4) from the mid to late 1990s, despite
Blanchard’s protestations that his income was "very low," Blanchard
and Secor maintained a "lavish lifestyle," which included purchases
of items such as a cruise vacation, a membership to a golf club, and
a Lexus LS400.
At the close of evidence, a jury convicted Blanchard on Counts 1-
6 and 12 of the indictment, Secor on Counts 1, 7-11, and 13 of the
1
Indeed, on cross-examination, Blanchard conceded that the income
reflected on Secor’s 1099’s from 1988-2000 was income earned by him,
not Secor.
UNITED STATES v. SECOR 5
indictment, and Dougherty on Counts 14-21 of the indictment. The
jury acquitted Dougherty of conspiring to defraud the United States,
Count 1 of the indictment. In January 2002, the district court sen-
tenced Secor to 33 months of imprisonment on Counts 1, 7-11, and
13, to run concurrently, and ordered her to pay restitution in the
amount of $253,746.52, as well as the costs of prosecution. The dis-
trict court sentenced Blanchard to 57 months of imprisonment on
Counts 1-6 and 12, to run concurrently on each count, and ordered
him to pay $345,350.13 in restitution as well as the costs of prosecu-
tion. Finally, Dougherty was sentenced to 36 months of imprisonment
on Counts 14-21, to run concurrently on each count, and ordered to
pay restitution in the amount of $93,542.00 and the cost of prosecu-
tion. Secor, Blanchard, and Dougherty then timely filed this consoli-
dated appeal.
II.
In reviewing a challenge to the sufficiency of the evidence support-
ing a conviction, we must sustain the verdict if "there is substantial
evidence, taking the view most favorable to the Government, to sup-
port it." United States v. Gallimore, 247 F.3d 134, 136-37 (4th Cir.
2001) (quoting Glasser v. United States, 315 U.S. 60, 80 (1942)).
Questions concerning the admissibility of evidence or the propriety of
including jury instructions are reviewed for abuse of discretion. See
United States v. Chin, 88 F.3d 83, 87 (4th Cir. 1996) (noting that this
Court reviews the refusal to admit evidence for abuse of discretion);
United States v. Whittington, 26 F.3d 456, 462 (4th Cir. 1994) (setting
forth the standard of review applicable to a challenge to the content
or inclusion of a particular jury instruction). The district court’s con-
clusion that a government agent’s report does not contain statements
discoverable under the Jencks Act is reviewed for clear error. United
States v. Escamilla, 467 F.2d 341, 345 (4th Cir. 1972). Finally, this
Court reviews the findings of fact supporting sentencing for clear
error. United States v. Daughtrey, 874 F.2d 213, 217-18 (4th Cir.
1989).
III.
A.
On appeal, Blanchard raises four issues. First, he challenges the
sufficiency of the evidence supporting his conviction for conspiring
6 UNITED STATES v. SECOR
to defraud the United States in violation of 18 U.S.C. § 371 (Count
1). Second, he challenges the sufficiency of the evidence supporting
his conviction for attempting to evade payment of taxes in violation
of 26 U.S.C. § 7201 (Counts 2-6). Third, Blanchard contends that
there is insufficient evidence to support his conviction for violating
26 U.S.C. § 7206(1), which prohibits the making of false statements
to a government agency (Count 12). Finally, Blanchard argues that
the court should have instructed the jury regarding willful failure to
pay taxes, the lesser included offense of a § 371 violation. For the fol-
lowing reasons, we conclude that all of his arguments are devoid of
merit.
1.
In order to satisfy its burden in proving a violation of § 371, "the
government must prove that "an agreed upon objective of the criminal
conspiracy was to thwart the IRS’s efforts to determine and collect
income taxes." United States v. Hairston, 46 F.3d 361, 374 (4th Cir.
1995) (internal quotation omitted). "A conviction under § 371 will not
stand where impeding the IRS was only a collateral effect of the con-
spiracy." Id. Here, there is overwhelming evidence that Blanchard and
Secor conspired to thwart the IRS’s efforts to collect Blanchard’s tax
liability. The government proffered evidence that each time it
attempted to levy one of Blanchard’s bank accounts, he would open
a new account in Secor’s name. The government also demonstrated
that despite Blanchard’s putative penury, he and Secor maintained a
"lavish lifestyle." In addition, Blanchard admitted, upon cross-
examination, that the income reflected on Secor’s Form 1099’s from
1988 until 2000, was income that he, not Secor, earned. This evi-
dence, viewed in the light most favorable to the government, is
clearly sufficient to prove that Blanchard violated § 371.
2.
Blanchard also challenges the sufficiency of the evidence support-
ing his conviction under 26 U.S.C. § 7201. Section 7201 states in rel-
evant part:
Any person who willfully attempts in any manner to evade
. . . any tax imposed by this title or the payment thereof
UNITED STATES v. SECOR 7
shall, in addition to other penalties provided by law, be
guilty of a felony and upon conviction thereof, shall be fined
not more than $100,000 . . . or imprisoned not more than 5
years, or both, together with the costs of prosecution.
26 U.S.C. § 7201. To prove a violation of § 7201, therefore, the gov-
ernment must demonstrate: (1) that the defendant acted willfully; (2)
that the defendant committed an affirmative act that constituted an
attempted evasion of tax payments; and (3) that a substantial tax defi-
ciency existed. United States v. Wilson, 118 F.3d 228, 236 (4th Cir.
1997). In determining whether a defendant has attempted to evade
payment of his taxes in violation of § 7201, "[t]he jury may infer a
‘willful attempt’ from ‘any conduct having the likely effect of mis-
leading or concealing.’" Id. (internal citation omitted). In the instant
case, while there is no dispute that Blanchard owed a substantial tax
deficiency, Blanchard disputes that he took affirmative acts to evade
payment of this tax liability.
The government, however, introduced evidence demonstrating that
Blanchard: (1) requested that Berryman deposit his commission pay-
ments into an account held by Secor; (2) opened new bank accounts
in Secor’s name when the IRS attempted to levy on his old accounts;
and (3) misled IRS agents by informing them on at least one occasion
that his income was "very low" while, in fact, he had received sub-
stantial commission payments. Given the foregoing evidence and
Blanchard’s admission that the income from Berryman Chemicals
listed on Secor’s Form 1099’s was income earned by him, the jury
had ample basis to conclude that Blanchard took affirmative steps to
evade payment of his tax liability.
3.
Blanchard also contests his conviction under Count 12 — filing
false tax returns with the IRS in violation of 26 U.S.C. § 7206(1) —
contending that he did not make a false statement either on Forms
433-A or Form 433-B. We also find this argument to be contradicted
by the government’s proofs.
The government may prove a violation of § 7206(1) by proffering
evidence that: "(1) the defendant made and subscribed to a tax return
8 UNITED STATES v. SECOR
containing a written declaration; (2) the tax return was made under
penalties of perjury; (3) the defendant did not believe the return to be
true and correct as to every material matter; and (4) the defendant
acted willfully." United States v. Nocolaou, 180 F.3d 565, 572 (4th
Cir. 1999) (internal quotation omitted). The government produced
evidence at trial, which included Berryman’s testimony, that on Form
433-A, Blanchard falsely represented, inter alia, that he was
employed by Secor as a chemical trader. Blanchard himself conceded
this misrepresentation during cross-examination, when he admitted
that he, not Secor, was employed by Berryman Chemicals. In light of
this evidence, this Court concludes that there was sufficient evidence
to convict Blanchard for violating § 7206(1). We therefore affirm his
conviction on Count 12.
4.
Finally, Blanchard argues that the district court failed to charge the
jury with the lesser-included offense § 371, "willful failure to pay
taxes." This Court has noted, however, that defendants are not entitled
to instructions regarding lesser-included offenses as a matter of
course. See United States v. Wright, 131 F.3d 1111, 1112 (4th Cir.
1997). "In order to receive a lesser-included offense instruction,
‘proof of the element that differentiates the two offenses must be suf-
ficiently in dispute that the jury could rationally find the defendant
guilty of the lesser offense but not guilty of the greater offense.’"
Wright, 131 F.3d at 1112 (internal citation omitted). As explained in
section III.A.1, however, there is ample evidence supporting the
jury’s finding that Blanchard was guilty of conspiracy to defraud the
United States. Accordingly, we conclude that the district court did not
abuse its discretion in refusing to provide the jury with Blanchard’s
proffered instruction. We now turn to the merits of Secor’s appeal.
B.
On appeal, Secor challenges the sufficiency of the evidence sup-
porting her convictions for: (1) conspiring to defraud the United
States (Count 1); (2) attempting to evade tax payments in violation of
26 U.S.C. § 7201 (Counts 7-11); and (3) making false statements to
the IRS in violation of 18 U.S.C. § 1001 (Count 13). Like Blanchard,
she also argues that the district court erred in refusing to instruct the
UNITED STATES v. SECOR 9
jury on a lesser-included offense. Finally, Secor contends that the dis-
trict court erred not only in requiring her to pay restitution for Blan-
chard’s failure to pay his tax liability but also in refusing to recognize
that she was a "minor participant" in the conspiracy. After reviewing
the record and relevant case law, we affirm her convictions and sen-
tence.
1.
Based on the evidence discussed above, the jury reasonably con-
cluded that Blanchard and Secor conspired to defraud the United
States in violation of 18 U.S.C. § 371. The government produced evi-
dence demonstrating that Secor assisted Blanchard in concealing his
income from the IRS by filing tax returns falsely indicating that she
earned income from Berryman Chemicals. In furtherance of Blan-
chard’s scheme to avoid the IRS’s tax levies, Secor also permitted
him to open new bank accounts in her name. This evidence amply
buttresses the government’s theory that Secor and Blanchard con-
spired to thwart the IRS’s efforts to determine and collect Blanchard’s
income taxes. See Hairston, 46 F.3d at 374.
2.
Secor also argues that this Court should reverse her five convic-
tions for attempting to evade tax payments in violation of 26 U.S.C.
§ 7201. She contends that there was a benign purpose for the income
apportionment scheme that she and Blanchard implemented to report
their income tax; to wit, the couple sought to separate their respective
potential tax liabilities by filing separately. Alternatively, Secor con-
tends that the apportionment of the income between herself and Blan-
chard for tax filing purposes "was designed to recognize Secor’s
$10,000 financial investment in Blanchard’s re-entry into the chemi-
cal trading business in 1988 and to compensate her for foregoing her
degree in anthropology." Br. for Appellants, at 26. Finally, Secor
maintains that her convictions should be reversed because she not
only filed her income taxes but also paid any tax liability she owed.
Section 7201 applies not only to a taxpayer who owes a deficiency
but also to those who assist another in concealing his or her income
from the IRS. See, e.g., United States v. Wilson, 118 F.3d 228, 236
10 UNITED STATES v. SECOR
(4th Cir. 1997) (noting that an attorney who had assisted taxpayer-
defendant in concealing his income and who prepared and executed
false notes was guilty of violating § 7201); United States v. Frazier,
365 F.2d 316 (6th Cir. 1966) (finding non-taxpayer defendant guilty
of willfully attempting to evade taxes by assisting co-defendant in
concealing his assets). Thus, the issue is not whether Secor paid her
own tax liability, but rather whether there is sufficient evidence to
conclude that she assisted Blanchard in concealing his. As discussed
above, there is ample evidence to support this conclusion, including
Blanchard’s testimony that Secor’s tax returns falsely represented that
she earned income from Berryman Chemicals. We therefore affirm
her convictions under § 7201.
3.
Finally, Secor challenges the sufficiency of the evidence support-
ing her conviction for making a false statement to the IRS in violation
of 18 U.S.C. § 1001. "A person is guilty of making false statements
to a government agency when the government proves: (1) that the
defendant made a false statement to a governmental agency or con-
cealed a fact from it or used a false document knowing it to be false;
(2) the defendant acted knowingly or willfully; and (3) the false state-
ment . . . was material to a matter within the jurisdiction of the
agency." United States v. Sarihifard, 155 F.3d 301, 306 (4th Cir.
1998). This Circuit has explained that "[a] statement is material if it
has the natural tendency to influence, or is capable of influencing, the
decision-making body to which it was addressed." Id. (internal quota-
tion omitted).
The government alleges that on November 10, 1997, Secor told an
IRS agent that since 1988, Blanchard had worked for her in her chem-
ical trading business and that she had conversations with Bob Berry-
man concerning potential chemical purchases. Secor also claimed that
she directed Berryman to deposit commission payments into her bank
account because she would have a more active role in the chemical
trading business. However, Berryman and Blanchard testified that
Secor was not involved in Berryman’s chemical business. This evi-
dence supports the jury’s conclusion that Secor’s statement to the
contrary was false and made in a willful effort to conceal Blanchard’s
actual income from the IRS, which was of course material. We con-
UNITED STATES v. SECOR 11
clude that there is sufficient evidence to sustain Secor’s conviction
under 18 U.S.C. § 1001 and therefore affirm her conviction on this
count.
4.
In addition to her sufficiency of the evidence challenges, Secor
argues that the district court abused its discretion by refusing to
instruct the jury on the lesser-included offenses of (1) conspiracy to
fail to pay taxes, which Secor maintains is contained in § 371, and (2)
misdemeanor failure to pay income taxes under 26 U.S.C. § 7203. We
find that the district court did not abuse its discretion in refusing these
instructions.
First, we have concluded that there is sufficient evidence to sustain
Secor’s conviction under § 371, and thus, she would not be entitled
to a lesser included offense on this charge. See Wright, 131 F.3d at
1112. Second, as to her claim that she was entitled to an instruction
for misdemeanor failure to pay taxes, there is no evidence in the
record that she requested that the district court provide this instruc-
tion. Because Secor did not raise this objection at trial, we review the
district court’s failure to provide this instruction for plain error.
United States v. Stitt, 250 F.3d 878, 882-83 (4th Cir. 2001) (setting
forth the standard of review where defendant fails to object at trial).
To establish plain error, Secor must show that: (1) an error occurred;
(2) the error was plain; (3) the error affected her substantial rights;
and (4) the error seriously affects the fairness, integrity, or public rep-
utation of judicial proceedings. Id. (citing United States v. Olano, 507
U.S. 725, 732 (1993)).
Here, Secor fails to satisfy the plain error test. Even assuming that
Secor had proffered the misdemeanor failure to pay taxes instruction,
the Supreme Court has explained that under § 7201, a lesser-included
offense instruction is necessary only if "there were disputed issues of
fact which would enable the jury rationally to find that, although all
of the elements of § 7201 have not been proved, all of the elements
of the lesser included misdemeanor have been proved." Sansone v.
United States, 380 U.S. 343, 351 (1965). Secor would not be entitled
to the lesser included offense instruction because, as discussed above,
there is sufficient evidence to sustain her conviction under § 7201.
12 UNITED STATES v. SECOR
5.
Next, Secor argues that the district court abused its discretion by
refusing to admit a letter written by Dougherty to the IRS on January
1, 1998. Secor contends that the admission of this letter, which
attempted to persuade the IRS that Secor’s and Blanchard’s financial
activities were legitimate and not worthy of investigation, was rele-
vant to her reliance upon advice of counsel defense.2 The district court
properly excluded Dougherty’s letter because the statements con-
tained therein were offered to prove the truth of the matter asserted
— namely, that Secor’s and Blanchard’s income tax apportionment
scheme was lawful — and thus were inadmissible under Federal Rule
of Evidence 802. The district court therefore did not abuse its discre-
tion by refusing to admit this evidence.
6.
Having affirmed Secor’s convictions, we now turn to the two sen-
tencing issues she has raised on appeal. First, Secor challenges the
amount of tax loss the district court attributed to her at sentencing.
Second, Secor contends that the district court erred in refusing to rec-
ognize that she was a "minor participant" in the offenses committed,
a finding which would entitle her to a two to three-level decrease in
her total offense level. After reviewing the record and the relevant
statutory and case law, we affirm Secor’s sentence.
Section 2T1.1(c) of the United States Sentencing Guidelines estab-
lishes a formula for the determination of the tax loss attributable to
a defendant. Section 2T1.1(c) provides in relevant part: "If the offense
involved tax evasion or a fraudulent or false return, statement, or
2
Both Secor and Blanchard argue that they are entitled to invoke the
reliance on advice of counsel defense. In order to properly invoke this
defense, the defendant must demonstrate: (1) full disclosure of all perti-
nent facts to counsel; and (2) good faith reliance on counsel’s advice. See
United States v. Butler, 211 F.3d 826, 833 (4th Cir. 2000). Given the evi-
dence that Blanchard and Secor knowingly filed false tax returns, they
cannot satisfy the good faith prong of this defense. Accordingly, neither
Blanchard nor Secor may avail himself or herself of the protections
afforded under the reliance on advice of counsel defense.
UNITED STATES v. SECOR 13
other document, the tax loss is the total amount of loss that was the
object of the offense (i.e., the loss that would have resulted had the
offense been successfully completed)." U.S.S.G. § 2T1.1(c). At sen-
tencing, the district court relied upon the facts and calculations set
forth in Secor’s pre-sentence report and concluded that Secor was lia-
ble for $253,746.52, the amount of tax deficiency owed by Blanchard
during the years that Secor falsely claimed income from Berryman
Chemicals. We conclude that this finding is not clearly erroneous.
Lastly, Secor argues that the district court erred when it concluded
that she was not a "minor participant" in the tax evasion scheme, for
the purpose of determining her total offense level. In order to deter-
mine whether a defendant is a "minor participant," the critical inquiry
is . . . not whether the defendant has done fewer ‘bad acts’ than his
[or her] co-defendants, but whether the defendant’s conduct is mate-
rial or essential to committing the offense." United States v. Palinkas,
938 F.2d 456, 460 (4th Cir. 1991). Here, the jury found that Secor
filed false tax returns and made false statements to the IRS in an
effort to conceal Blanchard’s actual income from the IRS. Based on
this evidence, this Court concludes that the district court’s finding on
this point was not erroneous, let alone clearly erroneous. Having
affirmed Secor’s convictions and sentence, the Court will now review
the merits of Dougherty’s appeal.
C.
Dougherty raises a number of issues on appeal. First, Dougherty
argues that there is insufficient evidence to support his convictions for
aiding and abetting in the preparation of false tax returns in violation
of 26 U.S.C. § 7206(2) (Counts 14-21). Second, Dougherty contends
that four of his convictions for violating § 7206(2) — Counts 15, 17,
19, and 21 — should be reversed because there was a material vari-
ance in the indictment and the government’s proffered evidence on
these counts. Third, Dougherty claims that the district court abused its
discretion when it: (1) denied Dougherty’s Jencks Act request; (2)
refused to admit into evidence a taped conversation between Dou-
gherty and his former employee; (3) permitted the government to
argue, over Dougherty’s objection, that Dougherty had a legal duty as
power of attorney to produce Secor’s and Blanchard’s tax records;
and (4) provided the jury with a "deliberate ignorance" instruction.
14 UNITED STATES v. SECOR
Finally, Dougherty argues that the district court’s factual findings at
sentencing were clearly erroneous.
1.
Dougherty first challenges the sufficiency of the evidence support-
ing his convictions for aiding in the preparation of a false tax return
in violation of 26 U.S.C. § 7206(2). To prove a violation of this provi-
sion of the Internal Revenue Code, the government must demonstrate
that: (1) the defendant aided, assisted, or otherwise caused the prepa-
ration of a return; (2) the return was fraudulent or false as to a mate-
rial matter; and (3) the act was willful. United States v. Aramony, 88
F.3d 1369, 1382 (4th Cir. 1996). Dougherty does not dispute that he
prepared Blanchard’s and Secor’s tax returns. Instead, he argues the
government failed to prove that Dougherty knew that the tax returns
were fraudulent or that he willfully prepared false tax returns. For the
following reasons, we reject these arguments.
From 1995 until 2000, Dougherty prepared Secor’s tax returns,
which stated that she received income from Berryman Chemicals.
Dougherty insists he was unaware that Secor was not employed at
Berryman Chemicals. Blanchard, however, testified at trial that Dou-
gherty was aware since 1994 that Blanchard, not Secor, earned
income from Berryman Chemicals. Dougherty’s records, which
chronicle his practice of arbitrarily transferring income between Blan-
chard and Secor, similarly suggest he was aware that Secor was not
employed by Berryman Chemicals. For example, in October 1991,
Janel Lucas, a former employee of Dougherty’s, wrote:
With the chemical market "gone to hell[,]" apparently your
cash flow has "gone to hell[.]" This puts a whole new per-
spective on how to proceed in filing these returns. If we file
Franceyn’s return showing the income as we had considered
doing, she will of course owe tax. Now that cash flow is so
bad, she will not be able to pay the tax and will be in serious
tax trouble. That would make both of you in serious tax
trouble. If we file the income going back to John, we have
only one individual in trouble.
In Dougherty’s November 25, 1991 written notes, he opined: "The
original plan had been for [Secor] to be the primary money winner,
UNITED STATES v. SECOR 15
with John working for her . . . . [Secor] said they don’t have money
for tax . . . . Most important — Keep [SECOR] clear of IRS, which
I agree. This[ ] [will] mean redoing [ ] [Secor’s] 1040’s showing all
income to John."
In addition to arbitrarily transferring Berryman Chemical income
between Blanchard and Secor, Dougherty also prepared and filed
Secor’s tax returns, reporting "cost of goods sold" deductions for
chemical trade commissions Secor allegedly paid to Blanchard. As
discussed above, however, Bob Berryman testified that Secor was
never employed by, nor involved in any way with his chemical trad-
ing business, a fact which Blanchard affirmed. We conclude therefore
that there is sufficient evidence to support the jury’s finding that Dou-
gherty willfully prepared and filed false tax returns in violation of
§ 7206(2).
2.
Dougherty also argues that his convictions on Counts 15, 17, 19
and 21 should be reversed because of an alleged material variance in
the indictment and the government’s proffered evidence. According
to Dougherty, "the government charged [in the indictment] that
Secor’s Schedule C overstated her costs of goods sold in that she
reported $73,000, $43,000, $81,466, and $66,808, when she allegedly
should have reported ‘0.’" Br. of Appellants, at 27. At trial, however,
the government offered evidence that Secor overstated her income.
The inquiry for determining whether a material variance exists
requires this Court to assess whether "the government, through its
presentation of evidence and/or its argument, . . . broadened the bases
for conviction beyond those charged in the indictment . . . ." United
States v. Randall, 171 F.3d 195, 203 (4th Cir. 1999). In Randall, we
explained, however, that "not all differences in an indictment and the
proof at trial, rise to the ‘fatal’ level of a constructive amendment.
When different evidence is presented at trial but the evidence does not
alter the crime charged in the indictment, a mere variance occurs."
171 F.3d at 203. "A mere variance does not violate a defendant’s con-
stitutional rights unless it prejudices the defendant by either surprising
him at trial and hindering the preparation of his defense, or by expos-
ing him to the danger of a second prosecution for the same offense."
16 UNITED STATES v. SECOR
Id. This Court therefore must reverse a defendant’s conviction only
if the appellant demonstrates that the variance infringed on his sub-
stantial rights, resulting in actual prejudice. See United States v. Ken-
nedy, 32 F.3d 876, 883 (4th Cir. 1994).
Counts 15, 17, 19, and 21 allege that Dougherty prepared and filed
false tax returns in violation of 26 U.S.C. § 7206(2). Whether the gov-
ernment presented evidence that Secor’s tax returns overstated her
income, or it proffered evidence that Dougherty overstated Secor’s
cost of goods deductions does not alter the core criminal conduct
charged in the indictment — that Dougherty willfully assisted Secor
in preparing and filing false tax returns. Accordingly, we conclude
that there was no material variance in the indictment and the evidence
presented at trial and therefore affirm Dougherty’s convictions on
these counts.3
3.
Next, Dougherty alleges that the district court abused its discretion
when it made several evidentiary rulings and refused to provide the
jury with a "deliberate ignorance" instruction. We find these chal-
lenges to be without merit.
First, Dougherty contends that the government’s failure to produce
IRS Agent Turner’s Special Agent Report ("SAR") violated 18 U.S.C.
§ 3500 (the "Jencks Act") because "it was likely that Turner’s testi-
mony [at trial] fell within the scope of what he would have included
in his SAR." Br. of Appellant William J. Dougherty, at 26. Mere alle-
gations are insufficient to prove a violation of the Jencks Act. The
defendant must establish an adequate foundation. United States v.
Boyd, 53 F.3d 631, 633 (4th Cir. 1995). At Dougherty’s request, the
district court conducted an in camera review of the agent’s report and
concluded that "there [was] no Jencks material in this report that had
not been provided to [Dougherty]." Dougherty did not object to the
3
Secor also argues that her convictions on Counts 7 through 11 should
be reversed because there is a material variance in the indictment and the
evidence the government proffered against her at trial. As discussed in
greater detail above, there is no material variance in the indictment and
the evidence presented at trial and thus we affirm her convictions.
UNITED STATES v. SECOR 17
manner in which the district court conducted its review of the SAR
and thus without more, we cannot conclude that the district court’s
finding on this issue is clearly erroneous.
Second, Dougherty claims that the district court erred by refusing
to admit a taped conversation between himself and his former
employee. Dougherty contends that this audiotaped conversation, in
which he told his employee to "tell the truth" to the IRS, demonstrates
his lack of willfulness in committing the offenses at issue and should
have been admitted into evidence under Federal Rule of Evidence
803(3), as evidence of his then existing state-of-mind. At the time
Dougherty made these statements, however, he was aware that he was
under investigation by the IRS and that his employee had an appoint-
ment to meet with IRS agents later that day. Given the circumstances
under which Dougherty made these statements, therefore, the district
court properly excluded this evidence because Dougherty had time to
reflect and fabricate. See United States v. Reyes, 239 F.3d 722 (5th
Cir. 2001) (noting that for a hearsay statement to be admissible, it
must have been contemporaneous with the state of mind sought to be
proved and the defendant must not have had time to reflect and possi-
bly fabricate or misrepresent his thoughts). In any event, Dougherty
testified during trial that he told his former employee "just to tell the
truth" and "don’t lie." Thus, the district court properly refused to
admit the taped conversation as it would have been duplicative of
Dougherty’s trial testimony. See Fed. R. Evid. 403 (explaining that
the district court may exercise its discretion to exclude certain evi-
dence when its "probative value is substantially outweighed by the
danger of unfair prejudice, confusion of the issues . . . or by consider-
ations of undue delay, waste of time, or needless presentation of
cumulative evidence").
Third, Dougherty argues that the government improperly argued at
trial that Dougherty, as power of attorney for Blanchard and Secor,
had a legal duty to produce the couple’s tax documents, which were
requested by the IRS as part of its investigation. Dougherty claims
that the district court’s failure to instruct the jury that Dougherty was
under no such legal duty constituted an abuse of discretion. We dis-
agree.
The indictment charged that Dougherty engaged in "obstructive
behavior and delay tactics designed to conceal Blanchard and Secor’s
18 UNITED STATES v. SECOR
income and assets from the IRS," by refusing "to provide the IRS
with Blanchard’s and Secor’s bank statements and financial informa-
tion, despite numerous requests and contacts by the IRS and assur-
ances by Dougherty that he would provide them." The indictment did
not allege that, as a power of attorney, Dougherty had a legal obliga-
tion to provide the documents. During trial, it was Dougherty’s coun-
sel who on direct examination first questioned Dougherty regarding
his knowledge of any IRS rules or regulations that would obligate him
to produce Blanchard’s records. Dougherty responded that he was
aware of a provision in the Internal Revenue Code related to power
of attorneys. Thus, Dougherty’s counsel "opened the door" to the gov-
ernment to pursue this line of questioning, and thus, the district court
did not abuse its discretion in either permitting this testimony or
refusing to instruct the jury that Dougherty was under no such legal
duty. See United States v. Mohr, 318 F.3d 613, 626 (4th Cir. 2003).
Finally, Dougherty objects to the district court’s decision to instruct
the jury regarding "deliberate ignorance." A willful blindness or
deliberate ignorance instruction allows a "jury to impute the element
of knowledge to [a] defendant if the evidence indicates that he pur-
posefully closed his eyes to avoid knowing what was taking place
around him." United States v. Schnabel, 939 F.2d 197, 203 (4th Cir.
1991). The district court properly utilizes this instruction when the
evidence supports an inference of deliberate ignorance on the part of
the defendant. United States v. Abbas, 74 F.3d 506, 513 (4th Cir.
1996); Schnabel, 939 F.2d at 203 ("When there is evidence of both
actual knowledge and deliberate ignorance . . . a willful blindness
instruction is appropriate."). In this case, the issue was whether Dou-
gherty was aware that Secor was not employed by Berryman Chemi-
cals for purposes of convicting him under § 7206(2). Blanchard
testified that Dougherty was aware that Berryman Chemicals did not
employ Secor. Dougherty’s records, furthermore, indicate that he not
only willingly transferred income between Secor and Blanchard on
their tax returns but was also concerned about alerting the IRS to
Blanchard’s whereabouts. Thus, even assuming that Dougherty did
not have actual knowledge of this fact, the jury could reasonably con-
clude that Dougherty "closed his eyes to avoid knowing what was tak-
ing place around him." Schnabel, 939 F.2d at 203. Accordingly, we
conclude that the district court did not abuse its discretion by instruct-
ing the jury on "deliberate ignorance."
UNITED STATES v. SECOR 19
4.
Having affirmed Dougherty’s convictions, we now turn to his argu-
ment that the district court’s factual findings at sentencing were
clearly erroneous. After reviewing the record and the relevant case
law, we conclude that there are no infirmities in the district court’s
findings of fact.
Dougherty first contests the district court’s finding that he perjured
himself at trial and therefore was entitled to a two-level enhancement
under U.S.S.G. § 3C1.1. Section 3C1.1 permits the district court to
impose a two-level enhancement "if the defendant willfully
obstructed or impeded, or attempted to obstruct or impede, the admin-
istration of justice during the . . . prosecution of the instant offense."
U.S.S.G. § 3C1.1. In order to apply § 3C1.1 at sentencing, the district
court must review the evidence and make an independent finding that
the defendant: (1) gave false testimony; (2) concerning a material
matter; (3) with the willful intent to deceive, rather than as a result
of confusion or mistake. United States v. Dunnigan, 507 U.S. 87, 92-
98 (1993).
At Dougherty’s sentencing, the district court adopted the pre-
sentence report, which detailed the statements with which Dougherty
committed perjury. After reviewing the record, we are satisfied that
these findings of fact are not clearly erroneous. The district court sat-
isfied the evidentiary inquiry required under Dunnigan, and thus, we
affirm Dougherty’s sentence. See United States v. Gilliam, 987 F.2d
1009, 1014 (4th Cir. 1993) (explaining that a court may adopt the
findings of fact contained in a pre-sentence report at sentencing).
Dougherty also appeals the district court’s decision to impose a
$253,746.52 restitution order. The findings of fact set forth in the pre-
sentence report thoroughly detail the assistance Dougherty provided
Blanchard in Blanchard’s attempt to evade paying his tax deficiency.
Because the district court adopted these findings and we find that
these factual findings are not clearly erroneous, we affirm the district
court’s restitution order.
IV.
We have reviewed the record and the relevant statutory and case
law and conclude that there are no infirmities warranting reversal of
20 UNITED STATES v. SECOR
Blanchard’s, Secor’s, or Dougherty’s convictions or requiring re-
sentencing. Accordingly, the jury’s verdict and the district court’s
imposition of sentence in this matter are hereby
AFFIRMED. | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582499/ | 31 So. 3d 786 (2010)
TOWNLEY
v.
STATE.
No. 1D08-3164.
District Court of Appeal of Florida, First District.
April 13, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515799/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
RUDOLPH T. STONISCH, III, UNPUBLISHED
March 12, 2020
Plaintiff-Appellee,
v No. 347724
Oakland Circuit Court
DAVID M. CLAPPER, LC No. 2017-157223-CZ
Defendant-Appellant.
Before: STEPHENS, P.J., and CAVANAGH and SERVITTO, JJ.
PER CURIAM.
Following this Court’s opinion in Stonisch v Forthright IV, LLC, unpublished per curiam
opinion of the Court of Appeals, issued November 15, 2018 (Docket Nos. 335635, 335821,
339558, 340787 and 343741), the trial court granted defendant’s motion to dismiss plaintiff’s case
against defendant for personal liability relative to a previous judgment and sanctions against
defendant’s company, Forthright IV, LLC (Forthright), but denied defendant’s motion to return
his appeal bond. Defendant appeals as of right, challenging the court’s decision to not return the
appeal bond. We affirm.
Before the appeal, the trial court had entered a judgment and orders in a different case
requiring that Forthright pay a total of $51,052 to plaintiff. It then granted summary disposition
to plaintiff on his claim against defendant for personal liability. This Court affirmed the judgment
and orders as to Forthright but reversed with respect to defendant, concluding that plaintiff’s
complaint should have been dismissed as premature because it was not demonstrated that
Forthright could not pay the money it owed plaintiff.
This Court reviews a trial court’s decision on whether to return a bond for an abuse of
discretion. In re Forfeiture of Surety Bond, 208 Mich. App. 369, 375; 529 NW2d 312 (1995). The
trial court abuses its discretion when it chooses an outcome outside the range of reasonable and
principled outcomes. Maldonado v Ford Motor Co, 476 Mich. 372, 388; 719 NW2d 809 (2006).
An appeal of a trial court order or judgment “does not stay” its “effect or enforceability,”
with specific exceptions provided in MCR 2.614 or MCL 600.867, unless this Court orders a stay
or the trial court orders a stay pending appeal. MCR 7.209(A)(1). “Within the time for taking the
-1-
appeal, the appellant shall file in the court or the tribunal from which the appeal is taken . . . any
bond required by law as a condition for taking the appeal[.]” MCR 7.204(E)(3). “Unless
determined by law, or as otherwise provided by this rule, the dollar amount of a stay or appeal
bond in a civil action or probate proceeding must be set by the trial court in an amount adequate
to protect the opposite party.” MCR 7.209(B)(1). Under MCR 7.209, an appeal bond stays
execution of the judgment or order during proceedings before this Court until jurisdiction is again
vested with the trial court. See MCR 7.305(I) (stating that, when a stay bond has been filed in the
Court of Appeals, “it operates to stay proceedings pending disposition of the appeal in the Supreme
Court unless otherwise ordered by the Supreme Court or the Court of Appeals”).
The contents of an appeal bond are dictated in MCR 7.209(F)(1), which provides in
relevant part:
(1) Civil Actions and Probate Proceedings. In a bond filed for stay pending
appeal in a civil action or probate proceeding, the appellant shall promise in writing:
(a) to prosecute the appeal to decision;
(b) to perform or satisfy a judgment or order of the Court of Appeals or the
Supreme Court;
(c) to perform or satisfy the judgment or order appealed from, if the appeal
is dismissed;
***
(e) to do any other act which is expressly required in the statute authorizing
appeal.
In this case, the parties stipulated that an appeal bond would be executed. The stipulation
provided the reasoning for defendant obtaining an appeal bond, stating:
The Court granted Summary Disposition in Plaintiffs favor against Defendant
David Clapper. The Court’s Order on Motions for Summary Disposition and Entry
of Judgment, entered by the Court on March 27, 2018, ordered that Defendant is
liable to Plaintiff on all judgments entered to date in Case No. 2015-150628-CH
against Forthright IV, LLC, and in favor of Rudolph T. Stonisch, III, totaling, with
interest, approximately $54,215. Defendant filed an appeal of the Court’s March
27, 2018 Order and the Court’s Order denying Defendant’s Motion for
Reconsideration, dated April 19, 2018, before the Michigan Court of Appeals on
May 10, 2018. Defendant desires to stay enforcement of the judgments in Stonisch
v. Forthright IV, LLC, Case No. 2015-150628-CH, and this case during the
pendency of the appeals, and Plaintiff desires a bond.
The stipulation concluded:
Pursuant to MCR 7.209(E)(2)(a), an appeal bond in the form of cash in the sum of
$59,637 will be deposited by Defendant with the Clerk of the Oakland County
-2-
Circuit Court on or before May 25, 2018. Therefore, the parties, upon such deposit
being made, and acting through their respective counsel, stipulate that enforcement
of the judgments are stayed on the terms set forth in the Order Regarding Bond on
Appeal.
The trial court’s subsequent order stated that defendant was agreeing to
a. Diligently prosecute the appeal of the Order on Motions for Summary
Disposition and Entry of Judgment, entered by the Court on March 27, 2018, and
the Order denying Defendant’s Motion for Reconsideration, entered by the Court
on April 19, 2018, to decision and perform and satisfy the judgment or order
entered by the Court of Appeals or Supreme Court;
b. perform or satisfy the orders appealed if they are not set aside or reversed,
including costs and interest, if applicable; and
c. Perform any other acts required by law.
The trial court concluded:
IT IS HEREBY ORDERED that enforcement of the Judgment entered by this Court
on March 27, 2018, and the judgments entered in Stonisch v. Forthright IV, LLC,
Case No. 2015-150628-CH, are stayed during the pendency of the appeals in this
matter and the appeals in Case No. 2015-150-628-CH, upon a cash deposit of
$59,637 by Defendant with the Clerk of this Court on or before May 25, 2018. The
deposit shall remain with the Clerk until further order of this Court.
Defendant signed a form indicating that he had paid a $59,637 bond (on a judgment of $51,052);
the form included the language required by MCR 7.209(F)(1), specifically that defendant would
“[d]iligently prosecute this appeal to decision,” and “perform or satisfy the judgment or order
appealed including costs and interest.”
A stipulation by parties to a court case is a contract that is “governed by the legal principles
applicable to the construction and interpretation of contracts.” Bd of Co Rd Comm’rs for Co of
Eaton v Schultz, 205 Mich. App. 371, 379; 521 NW2d 847 (1994). The goal of contract
interpretation “is to determine and enforce the parties’ intent on the basis of the plain language of
the contract itself.” AFSCME v Detroit, 267 Mich. App. 255, 262; 704 NW2d 712 (2005). This
Court’s “primary goal in interpreting any contract is to give effect to the parties’ intentions at the
time they entered into the contract.” Bank of America, NA v First American Title Ins Co, 499 Mich.
74, 85; 878 NW2d 816 (2016). In this case, the language of the stipulation and the trial court order
regarding bond demonstrate that the parties intended for the bond to apply to the judgment in the
2015 Forthright case as well as the instant case.
The stipulation states that defendant had appealed the trial court’s order in the instant case
that “[d]efendant is liable to Plaintiff on all judgments” from the 2015 Forthright case (totaling
$54,215, including interest). Critically, the stipulation stated that defendant wanted to stay the
judgments of the instant case and the 2015 Forthright case “during the pendency of the appeals,”
-3-
and concluded that defendant’s deposit of a $59,637 appeal bond would result in a “stipulate[ion]
that enforcement of the judgments are stayed.” Thus, the term “appeals” in the stipulation refers
to a stay in the two appeals mentioned, and the stay was intended to apply to judgments that had
been mentioned—the instant case and the 2015 Forthright case. The language of the filed
agreement of the parties states an intention that the bond that defendant paid was to stay the
judgment in the 2015 Forthright case, as well as the instant case.
In the stipulation, the parties agreed to abide by the “terms set forth in the Order Regarding
Bond on Appeal.” The trial court’s order regarding bond ordered that, pursuant to defendant’s
deposit of the bond, the judgments of both the instant case and the 2015 Forthright case were
stayed “during the pendency of the appeals” in both matters. Thus, the trial court’s order embodied
the parties’ agreement that defendant would pay a bond in order to stay the judgments in this and
the 2015 Forthright case while defendant was appealing the orders and judgments in those cases.
The trial court’s order regarding bond states that defendant agreed to “prosecute the appeal”
of the trial court’s orders granting summary disposition, entering judgment, and denying
reconsideration in the instant case, and perform and satisfy orders pertaining to this case, without
similar language about the 2015 Forthright case. However, defendant had already been pursuing
appeals in the 2015 Forthright case for 18 months at the time of the order and the trial court ordered
that the bond was to stay the judgments in both cases during the pendency of both appeals, rather
than just the appeal in the instant case. Thus, the trial court’s order regarding bond does require
defendant to pursue his appeal of the 2015 Forthright case, and he was obligated to comply with
related orders as one of the conditions of the bond.
Defendant argues that the bond form governs the case and that the bond form only required
that defendant prosecute the appeal of the instant case. In this case, the bond form was filed in and
marked with the case number of the instant case, but did not specify which appeals defendant
would or would not pursue pursuant to the parties’ agreement. The trial judge did not sign the
bond on appeal, but did sign the order entered pursuant to the stipulation regarding bond, which
was submitted with the stipulation. “[A] court speaks through its written orders[.]” In re Contempt
of Henry, 282 Mich. App. 656, 678; 765 NW2d 44 (2009). Moreover, the parties’ agreement was
reflected in the stipulation and order, not the bond form, which would have been unilaterally
negotiated by defendant.
Defendant also argues that there was not a “meeting of the minds” sufficient to form an
agreement if the parties disagreed about whether the bond would serve to guarantee the judgment
in the 2015 Forthright case. However, defendant memorialized his agreement regarding the bond
with plaintiff and specified that he “desire[d] to stay enforcement of the judgments in Stonisch v.
Forthright IV, LLC, Case No. 2015-150628-CH, and this case during the pendency of the appeals,”
and that he would deposit $59,637 with the “stipulate[ion] that enforcement of the judgments are
stayed on the terms set forth in the Order Regarding Bond on Appeal.” Defendant argues that the
2015 Forthright case is only mentioned to clarify which judgment was stayed and would be
appealed. However, the parties’ words and the language of the trial court are unambiguous and
their meaning is apparent.
The purpose of a stay is “to preserve the status quo during the period an aggrieved party
has to file posttrial motions or an appeal.” In re Contempt of Calcutt, 184 Mich. App. 749, 755;
-4-
458 NW2d 919 (1990). In this case, the documents evidence the parties’ intent for the bond to
secure a stay of the judgments in this case and the 2015 Forthright case. Defendant does not
explain why plaintiff would agree to stay the judgments during his appeals in both the current and
2015 Forthright cases, but only require one bond. Defendant stated that his desire was to have the
judgments in both cases stayed, and defendant asked for a stay of the judgments in both cases at
the conclusion of the hearing on motions for disposition. Additionally, the amount of the appeal
bond was similar to the amount of the judgment in the 2015 Forthright case. A bond includes a
promise by the appellant “to perform or satisfy the judgment or order appealed from.” MCR
7.209(F)(1)(c). Both the stipulation and the order regarding bond state that both the judgment in
the instant case and in the 2015 Forthright case would be stayed by the payment of the bond.
Defendant received the benefit, and the purpose and intent of the bond was fulfilled because
enforcement of the judgments in the instant case and 2015 Forthright case was stayed pending
appeal. The stated original basis for filing the appeal bond, to stay enforcement of the judgments
and allow defendant to prosecute the appeals in this case and the 2015 Forthright case, continued
to exist beyond the dismissal of the current case. Because the evidence strongly supports the
conclusion that defendant paid the bond in order to achieve a stay on enforcement in the 2015
Forthright case and the instant case, the trial court did not abuse its discretion by denying
defendant’s motion for the return of the bond.
Affirmed.
/s/ Cynthia Diane Stephens
/s/ Mark J. Cavanagh
/s/ Deborah A. Servitto
-5- | 01-03-2023 | 03-13-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1496595/ | 31 F.2d 817 (1929)
SOUTHERN SURETY CO. et al.
v.
COMMERCIAL CASUALTY INS. CO. et al.
No. 3944.
Circuit Court of Appeals, Third Circuit.
February 6, 1929.
Rehearing Denied April 30, 1929.
J. L. Parrish, of Des Moines, Iowa, and Donald Thompson, Calvert Thompson & Berger, Patterson, Crawford, Arensberg & Dunn, and Charles F. C. Arensberg, all of Pittsburgh, Pa., for appellants.
W. Clyde Grubbs, Albert C. Hirsch, John M. Freeman, and Watson & Freeman, all of Pittsburgh, Pa., for appellees.
Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges.
PER CURIAM.
In the court below, the Commercial Casualty Insurance Company moved the court, and its motion was granted, to dismiss the bill brought by the Southern Surety Company and the National Surety Company, against it. Thereupon the latter companies took this appeal. The case was fully discussed, and the reasons which *818 *819led that court to dismiss the bill are fully discussed in its opinion, which is printed in the margin.[1] Finding ourselves in accord therewith, said opinion is adopted as expressive of our views, and the decree is affirmed.
NOTES
[1] "This bill is filed by the plaintiffs to compel contribution by the Commercial Casualty Insurance Company, one of the defendants, it being claimed that the other defendant, the county of Allegheny is, under the facts of the case, a necessary party. The case is before us on the motion of the casualty company to dismiss the bill as to it.
"Briefly stated, the situation disclosed by the bill, and from which it is claimed the right of contribution arises, is as follows:
"During 1924 and 1925, and prior thereto the county of Allegheny kept on deposit certain of its funds in the Carnegie Trust Company. To indemnify the county against loss, the trust company, as principal, gave three bonds, one for $1,100,000 with the Southern Surety Company, one for $150,000 with the National Surety Company, and one for $80,000 with the Commercial Casualty Insurance Company, as surety; copies of the three bonds being attached as exhibits to the bill.
"It is averred that each of the bonds were executed for the purpose of securing the same funds, viz., deposits made by the county in the said trust company; that in April, 1925, the trust company became insolvent and suspended business, and that its affairs are being liquidated by the commissioner of banking of Pennsylvania. That at the time of the failure, the said county had on deposit in the trust company a sum of money, the exact amount of which plaintiffs are unable now to state, but which they allege was in excess of the penalties upon bonds executed by the plaintiffs, to wit, in excess of the sum of $1,250,000.
"That thereafter, viz., on the 1st day of May, 1925, and again on the 14th of the same month, the county, acting through its proper officer, the county comptroller, made demand upon the plaintiff for the payment of the amount due to the county from the said trust company, on account of deposits made by the county, to the extent of the penalties on their bonds, and that plaintiffs are informed and believe that on the same dates, a similar demand was made on the defendant the Commercial Casualty Insurance Company for the payment of the amount due from the said trust company, to the extent of the penalty on its bond.
"That afterwards, the Southern Surety Company paid to the county, to apply on the amount of deposits due from the trust company, the sum of $1,099,427.32, with 6 per cent. interest thereon, and the National Surety Company paid in like manner the sum of $149,921.91 with interest; that the defendant the Commercial Casualty Insurance Company failed and refused to pay the county any sum whatever on account of its liability; that the secretary of banking, as plaintiffs are informed, on or about the 27th of June, 1926, paid to the county of Allegheny a dividend upon its deposit in the trust company, the sum of $132,930.74, and that the said payment of $132,930.74 more than pays and satisfies the amount due the county of Allegheny on account of said deposits.
"Plaintiffs aver that by reason of the facts thus set forth they are entitled to recover from Allegheny county the surplus in its hands after satisfying its claim against Allegheny county on account of said deposits, and is entitled to recover from the defendant contributions for its proportionate share of the amounts paid by the plaintiff to the county after crediting the Commercial Casualty Company with its proportion of the surplus recovered from the county.
"That about October 1, 1928, the complaints were reimbursed by the county of Allegheny out of the dividend received by it as aforesaid, viz., the Southern Surety Company receiving $39,196.09, and the National Surety Company, $5,344.92.
"The bill prays that the amount of the deposit made by Allegheny county at the time of failure be ascertained and determined, and that the amount in its hands above that sufficient to pay its claim against the trust company be determined, and that all further amounts received by the county be distributed between the plaintiffs, with due allowance to the defendant by way of credits, as their interests may appear, and that the liability of the defendant to the plaintiffs by way of contribution be fixed and determined.
"While a motion to dismiss admits those matters in the bill which are well pleaded, it does not admit conclusions of law, or averments as to the meaning of a contract when the contract itself is attached to the bill. And inasmuch as copies of the three surety contracts are attached to the bill, in determining whether a cause of action is set forth, the court is governed, not by the averments as to the meaning of the contracts, but by the true construction of the contracts themselves.
"I am constrained to hold that the bill does not disclose a cause of action for contribution against the Commercial Casualty Company, defendant, for the following reasons:
"First. The parties plaintiff and the casualty company, defendant, are not bound by a common burden in the same degree or by the same risk as is clearly disclosed by the contracts themselves. The policies of the plaintiff companies are blanket, unconditional, and unlimited. They assume liability for all deposits and property, and for all loss up to the penal amounts of their policies. The contract of defendant limits its liability to such deposits as result from `cash and cash items' actually and regularly deposited. Its liability is also limited by numerous express conditions. Among these are a limited liability clause, a coinsurance clause, a pro rata clause, a subrogation clause, and a clause securing a right of benefit from other securities.
"The cases are numerous and comparatively uniform that where the parties do not stand in equali jure there can be no contribution. Equality in bearing a common burden is the principle upon which contribution rests. It does not rest on contract, but on the broad principle that equality is equity; and where a number of parties stand on the same footing as to liability, one of the number cannot be compelled to assume the whole burden, but may compel his associates to share with him in the loss which he is compelled to pay Stone v. Fenno, 88 Mass. (6 Allen, 579); Bulkeley v. House, 62 Conn. 459, 26 A. 352, 21 L. R. A. 247; Turk v. Newark Fire Ins. Co. (D. C.) 4 F.(2d) 142; Meigs v. Insurance Co., 205 Pa. 378, 54 A. 1053; King v. Lancaster County Mut. Ins. Co., 45 Pa. Super. Ct. 464; 5 Pom. Eq. Juris. par. 2338, p. 5169.
"Second, The plaintiff's policies cover the whole risk, that is `all the County funds and property of said County that may come into its hands,' and judgment may be confessed `for the full amount of the money and interest and the full value of the securities, chattels and other properties that may be due and owing from' the trust company.
"The defendant's bond covers only `such cash and cash items as shall have been actually and regularly deposited * * * in an account subject to check.' The one covers `funds and property,' the other only `cash and cash items.' In such a situation, under the Pennsylvania rule, where one policy covers only a portion of the risk, it is held not to be double insurance, and neither insurer can claim contribution from the other. Meigs v. Insurance Co., 205 Pa. 378, 54 A. 1053, and cases there cited.
"This rule has been held to apply, in the federal courts, to cases arising in Pennsylvania. Turk v. Newark Fire Insurance Co. (D. C.) 4 F.(2d) 142. The same rule is laid down by Judge Woolley in this circuit, in Newark Fire Insurance Co. v. Turk (C. C. A.) 6 F.(2d) 533, 43 A. L. R. 496, where the authorities are cited.
Third. Under the coinsurance clause in defendant's contract, the defendant's obligation is separate and independent from the plaintiffs', and the payment by the latter of the defendant's pro rata share would not release it from its liability to the insurer. Each insurer had the right to make its own contract and to designate the conditions upon which it should be bound. The defendant having protected itself with the coinsurance clause, it became an independent obligor, and its contract is not affected by the contract of another insurer. Under the coinsurance clause of defendant's contract, it became liable, not for the entire loss up to the amount of its bond, but only for a certain percentage of the loss based on the total insurance which was carried. This principle is clearly established by the authorities. Scruggs & Echols v. American Insurance Co. (C. C. A.) 176 F. 224, 36 L. R. A. (N. S.) 92. In this case the authorities are gathered, and referring to the pro rata clause, the court said: `Where there are several policies containing this clause, they are all, and each, liable to pay the ratable portion mentioned in the clause, though it happen that some have voluntarily paid more than their share, and that there is no contribution between policies containing this clause.' See also Rochester German Insurance Co. v. Schmidt [C. C. A.] 175 F. 720.
"Fourth. Defendant's contract with Allegheny county is a separate and independent contract. There is no privity between plaintiffs and defendant, and plaintiffs could only recover by being subrogated to the rights of the county. The sole right of action of the county against the defendant would be under its contract with the defendant, and the plaintiffs' rights, if any, against the defendant, would be because they succeeded to the rights of the county of Allegheny. It would therefore be necessary both to aver and prove that defendant is liable on its contract to the county of Allegheny, and that they have succeeded to these rights through the right of subrogation.
"Fifth. It is a fundamental principle that in order to create a right of contribution, the plaintiffs must have been legally liable to pay, and must have actually paid under compulsion and obligation, that for which both plaintiffs and defendant were equally liable. This does not sufficiently appear by the averments of the bill taken in connection with the three contracts, the interpretation as to the true meaning of which is a question of law for the court.
"The motion to dismiss the plaintiffs' bill as to the Commercial Casualty Insurance Company, defendant, is therefore sustained, and the bill dismissed, with costs." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/723771/ | 91 F.3d 625
44 Fed. R. Evid. Serv. 963
OPUS 3 LIMITED, Plaintiff-Appellee,v.HERITAGE PARK, INCORPORATED, Defendant-Appellant, and PaulStein, Defendant,andJames O'Brien; David Kopp; David J. Mislin; John Does,Third Party Defendants.
No. 95-1863.
United States Court of Appeals,Fourth Circuit.
Argued April 1, 1996.Decided July 23, 1996.
ARGUED: Paul Mark Sandler, Freishtat & Sandler, Baltimore, Maryland, for Appellant. Edward W. Cameron, Odin, Feldman & Pittleman, P.C., Fairfax, Virginia, for Appellee. ON BRIEF: Raymond Daniel Burke, Freishtat & Sandler, Baltimore, Maryland, for Appellant.
Before ERVIN, NIEMEYER, and WILLIAMS, Circuit Judges.
Affirmed by published opinion. Judge NIEMEYER wrote the opinion, in which Judge ERVIN and Judge WILLIAMS joined.
OPINION
NIEMEYER, Circuit Judge:
1
At the outset of the bench trial in this case, which involved a claim for money due for construction services performed, Opus 3 Limited, the plaintiff, invoked Federal Rule of Evidence 615 to exclude witnesses from the courtroom during trial. The defendant, Heritage Park, Incorporated, opposed Opus 3's request to sequester its only witness, arguing that the witness was both its expert witness and designated representative at trial. The district court sequestered the witness and proceeded with trial, ultimately awarding Opus 3 damages.
2
On appeal, Heritage Park contends that the district court improperly excluded its witness from the courtroom because, as an expert witness, he was essential to the presentation of its cause under section (3) of Rule 615, and he was a corporate representative under section (2). Heritage Park also challenges the district court's damages award. For the reasons that follow, we affirm.
3
* In April 1993, Heritage Park, the owner of a residential apartment complex in Adelphi, Maryland, allegedly negotiated an agreement with Opus 3 to perform renovation work on the complex. Under the agreement, Heritage Park was to compensate Opus 3 on a time and materials basis, plus profit. Heritage Park retained Bryan Mack, a general contractor, to act as its on-site representative for the construction project.
4
As work progressed, Opus 3 submitted invoices for extra work approved by Mack. But Heritage Park disputed Mack's authority to approve any work, contending that he was an independent contractor hired by Heritage Park only to inspect the property and perform specific maintenance and construction tasks. When Heritage Park refused payment, Opus 3 filed this action.
5
In response to Opus 3's lawsuit, Heritage Park contended that Opus 3 had exceeded its authority to perform work; that it had charged excessively for its work; and that it had not properly supervised its subcontractors, causing "massive overtime charges." It also maintained that Mack had never been an agent, employee, or officer of Heritage Park and that therefore he was not authorized to approve the extra work performed by Opus 3. In the pretrial order, however, Heritage Park did identify Mack as its expert witness in the field of "general contracting and project management."
6
At the beginning of trial, Opus 3 invoked Federal Rule of Evidence 615, requesting "a rule on witnesses." It stated that its "request [was] really directed specifically at the primary witness[for] the defense in this case, Mr. Bryan Mack." While acknowledging that Heritage Park was offering Mack as an expert witness, Opus 3 explained that "he is also one of the key, in fact, the key fact witness that the defense would offer today as well."
7
Heritage Park confirmed that Mack, its only witness, was both a fact witness and an expert witness. It argued, however, that Mack should be exempted from sequestration because he was a "critical witness" who needed to hear "the very testimony he is going to give an opinion on." Heritage Park also argued that it had designated Mack as its trial representative, relying on a letter its president had sent Mack, which stated, "[S]ince I will not be going to the trial in Maryland, you are hereby authorized to act on behalf of Heritage Park, Inc. at the trial."
8
After considering both parties' arguments, the district court excluded Mack from the courtroom, explaining:
9
[S]ince [Mack] is not affiliated with the defendant by way of an agent or a high managerial position, I think it is unfair to have him sit in if he is going to address a factual issue in dispute.
10
On the issue of damages, Opus 3 introduced evidence of the work it had performed for Heritage Park, including the work that Mack had approved, as well as the expenses it had incurred. It introduced all of the invoices from its various suppliers and subcontractors that related to the construction work, as well as time records for labor, and evidence that the bills and invoices were reasonable and in line with industry standards in the area.
11
The district court credited Opus 3's testimony over Mack's and awarded Opus 3 $71,280.50, plus pre-judgment interest and costs. This appeal followed.
II
12
Upon a party's request for witness sequestration, Federal Rule of Evidence 615 requires the court to exclude witnesses so that one witness cannot hear the testimony of another. The rule is designed to discourage and expose fabrication, inaccuracy, and collusion. Fed.R.Evid. 615 advisory committee's note; see also United States v. Leggett, 326 F.2d 613, 613 (4th Cir.) (noting that witness sequestration "prevent[s] the possibility of one witness shaping his testimony to match that given by other witnesses at the trial"), cert. denied, 377 U.S. 955, 84 S.Ct. 1633, 12 L.Ed.2d 499 (1964). The merit of such a rule has been recognized since at least biblical times. The Apocrypha, vv. 36-64, relates how Daniel vindicated Susanna of adultery by sequestering the two elders who had accused her and asking each of them under which tree her alleged adulterous act took place. When they gave different answers, they were convicted of falsely testifying. See 6 John H. Wigmore, Wigmore on Evidence § 1837, at 455-56 (James H. Chadbourn ed., 1976). It is now well recognized that sequestering witnesses "is (next to cross-examination) one of the greatest engines that the skill of man has ever invented for the detection of liars in a court of justice." Id. § 1838, at 463.
13
Despite the powerful policies behind sequestration, the rule must yield to the yet more powerful confrontation and due process considerations of allowing the parties themselves to be in court and to present their cases. See Fed.R.Evid. 615 advisory committee's note. Thus, sections (1) and (2) exempt from sequestration parties to the litigation, deeming the party in the case of a corporation to be its designated corporate officer or employee. And section (3) exempts any person whose presence is found by the district court to be essential to the presentation of the party's cause.1
14
Because of its important role in reaching the truth, Rule 615 carries a presumption favoring sequestration. See United States v. Farnham, 791 F.2d 331, 335 (4th Cir.1986). Accordingly, we construe the rule's exemptions "narrowly in favor of the party requesting sequestration." Id. For the same reason, the party seeking to avoid sequestration of a witness bears the burden of proving that a Rule 615 exemption applies. See United States v. Jackson, 60 F.3d 128, 135 (2d Cir.), cert. denied, --- U.S. ----, 116 S.Ct. 487, 133 L.Ed.2d 414 (1995), and cert. denied, --- U.S. ----, ----, 116 S.Ct. 951, 1057, 133 L.Ed.2d 875, 134 L.Ed.2d 201 (1996); Government of the Virgin Islands v. Edinborough, 625 F.2d 472, 476 (3d Cir.1980).
15
Our review of a district court's application of Rule 615 depends on the nature of the district court's ruling. We review de novo the district court's order refusing sequestration or sequestering a person whom it finds exempt under section (1) or (2), and we review for clear error factual findings about who is a party, officer, or employee. But a ruling under section (3) resembles a trial court's evidentiary rulings, which fall within the courts' broad discretion over the conduct of trials. Accordingly, we apply an abuse of discretion standard to a district court's judgment about whether section (3) exempts a person as essential to a party's presentation of its cause. See Jackson, 60 F.3d at 134-35; Polythane Sys., Inc. v. Marina Ventures Int'l, Ltd., 993 F.2d 1201, 1209 (5th Cir.1993), cert. denied, 510 U.S. 1116, 114 S.Ct. 1064, 127 L.Ed.2d 383 (1994).
16
In the case before us, Opus 3 invoked Rule 615 because Mack's factual testimony was expected to be at the core of the dispute. And in response, Heritage Park argued that Mack should be exempted from sequestration because (1) he was its expert witness who needed to hear other testimony to form his opinions, and (2) he was Heritage Park's designated trial representative.
17
* In arguing that Mack was exempt from sequestration because of his role as expert witness, Heritage Park relies on section (3) of Rule 615, which exempts from sequestration persons essential to the presentation of its cause, and on Federal Rule of Evidence 703, which permits experts to base their opinions on facts and data made known to them "at or before the hearing."
18
Because Rule 615 is designed to preclude fact witnesses from shaping their testimony based on other witnesses' testimony, it does not mandate the sequestration of expert witnesses who are to give only expert opinions at trial. Indeed, an expert who is not expected to testify to facts, but only assumes facts for purposes of rendering opinions, might just as well hear all of the trial testimony so as to be able to base his opinion on more accurate factual assumptions. Nevertheless, we decline to adopt a per se rule exempting expert witnesses, even those who are expected only to render opinions, from sequestration. The rule does not provide such an exemption and section (3) vests in trial judges broad discretion to determine whether a witness is essential. See Morvant v. Construction Aggregates Corp., 570 F.2d 626, 630 (6th Cir.), cert. dismissed, 439 U.S. 801, 99 S.Ct. 44, 58 L.Ed.2d 94 (1978).
19
In the case before us, even if Mack were going to testify only as an expert, Heritage Park failed to establish that he needed to hear the trial testimony of the other witnesses in order to render his opinions. Mack had received and reviewed all of Opus 3's records, including its expert's records of the cost of services rendered, and had prepared a written analysis well before trial. Thus, Heritage Park never articulated why Mack's presence was " 'essential,' rather than simply desirable." Jackson, 60 F.3d at 135.
20
But Mack was not just an expert witness. He was a fact witness whose testimony was crucial to the disputed issues. Whether Heritage Park owed Opus 3 money hinged in part on the relative credibility of Mack on the one hand and Opus 3's witnesses on the other. And the district court excluded Mack not because he was an expert who would not benefit from testimony, but because he was a key fact witness. It is in precisely this circumstance that adherence to the sequestration rule is most important. See Farnham, 791 F.2d at 335. ("Scrupulous adherence to [the sequestration rule] is particularly necessary in those cases in which the outcome depends on the relative credibility of the parties' witnesses").
21
We conclude that the district court did not abuse its discretion in ruling that Mack was not exempt under section (3) of Rule 615.2B
22
Heritage Park also argues that Mack "was specifically employed, authorized and designated by Heritage Park to be its representative at trial," and that by excluding him from the courtroom during the trial, the court violated Heritage Park's right--"of constitutional dimension"--to be present during trial, in violation of section (2) of Rule 615.
23
Section (2) exempts from sequestration only "an officer or employee of a party which is not a natural person designated as its representative by its attorney." Yet, in the pretrial order in this case, Heritage Park stated that "Mr. Mack has never been an agent, employee, officer or director of Heritage Park." And Heritage Park never recanted its position that Mack was an independent contractor who was not authorized to bind the company in any respect. Moreover, we can find no evidence in the record that Mack was in fact a Heritage Park employee. There is no indication that the company paid him a salary, that it paid taxes or other assessments generally due in respect of employees, or that its officers controlled Mack. Because the district court's finding that Mack was not an officer or employee of Heritage Park for section (2) purposes is not clearly erroneous, Heritage Park failed to meet the exemption's requirements.
24
While Heritage Park had to concede under its theory of the case that Mack was not a corporate officer or employee, it falls back on the letter that Heritage Park's president sent to Mack before trial designating him "to act on behalf of Heritage Park, Inc. at the trial." Heritage Park argues that, by virtue of the letter, Mack became an employee of the company for Rule 615 purposes and therefore was entitled to be present at trial as Heritage Park's corporate representative. We cannot agree that a corporation's mere designation of a person to act on its behalf at trial converts the person into its employee. Moreover, to allow a corporate party to "employ" a person solely as its trial representative would render Rule 615 meaningless. A corporate party could avoid the rule in every case by designating its key witness or "employing" that witness as its trial representative. We decline to recognize the efficacy of such a practice.
III
25
Finally, Heritage Park challenges the sufficiency of Opus 3's damages evidence. While Heritage Park failed to present its argument to the district court, we need not determine whether Heritage Park has thereby waived it because the district court's damages award is well supported by the evidence in the record. Opus 3 introduced into evidence (1) all of the invoices from its various suppliers and subcontractors relating to its construction activities for Heritage Park, (2) the time records for its labor, (3) testimony from Opus 3's witnesses that Opus 3 had actually incurred the various expenses, and (4) expert testimony that the amounts of the invoices and labor charges were reasonable.
26
Accordingly, the judgment of the district court is
27
AFFIRMED.
1
Federal Rule of Evidence 615 provides:
At the request of a party the court shall order witnesses excluded so that they cannot hear the testimony of other witnesses, and it may make the order of its own motion. This rule does not authorize exclusion of (1) a party who is a natural person, or (2) an officer or employee of a party which is not a natural person designated as its representative by its attorney, or (3) a person whose presence is shown by a party to be essential to the presentation of the party's cause.
2
On appeal, Heritage Park also contends that Mack's presence in the courtroom was essential to the presentation of its cause because he was needed "to advise counsel in the management of the litigation." But Heritage Park failed to present this contention to the trial judge when he was ruling on Opus 3's sequestration request. Heritage Park argued only that Mack was a "critical witness." Such an assertion, however, is insufficient to justify the Rule 615(3) exemption. See Miller v. Universal City Studios, Inc., 650 F.2d 1365, 1374 (5th Cir.1981) (noting that defendants argument that expert witness was "crucial" to their case did not invoke Rule 615(3) exemption); Morvant, 570 F.2d at 629 (rejecting argument that expert was needed to advise counsel for failure to present it to district court). Moreover, even now Heritage Park cannot demonstrate that Mack's presence was essential to the presentation of its cause; it has not articulated any specific harm to counsel that resulted from Mack's sequestration | 01-03-2023 | 04-17-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/2588859/ | 61 N.Y.2d 106 (1984)
Merritt Hill Vineyards Incorporated, Respondent-Appellant,
v.
Windy Heights Vineyard, Inc., et al., Appellants-Respondents.
Court of Appeals of the State of New York.
Argued January 4, 1984.
Decided February 21, 1984.
Daniel R. Taylor for appellants-respondents.
John R. Kennedy for respondent-appellant.
Chief Judge COOKE and Judges JASEN, JONES, WACHTLER and MEYER concur; Judge SIMONS taking no part.
*108KAYE, J.
In a contract for the sale of a controlling stock interest in a vineyard, the seller's undertaking to produce a title insurance policy and mortgage confirmation at closing constituted a condition and not a promise, the breach of which excused the buyer's performance and entitled it to the return of its deposit, but not to consequential damages. On the buyer's motion for summary judgment seeking recovery of both the deposit and consequential damages, the Appellate Division correctly awarded summary *109 judgment to the buyer for its deposit and to the seller dismissing the cause of action for consequential damages, even though the seller had not sought this relief by cross appeal.
In September, 1981, plaintiff, Merritt Hill Vineyards, entered into a written agreement with defendants, Windy Heights Vineyard and its sole shareholder Leon Taylor, to purchase a majority stock interest in respondents' Yates County vineyard, and tendered a $15,000 deposit. The agreement provides that "[i]f the sale contemplated hereby does not close, Taylor shall retain the deposit as liquidated damages unless Taylor or Windy Heights failed to satisfy the conditions specified in Section 3 thereof." Section 3, in turn, lists several "conditions precedent" to which the obligation of purchaser to pay the purchase price and to complete the purchase is subject. Among the conditions are that, by the time of the closing, Windy Heights shall have obtained a title insurance policy in a form satisfactory to Merritt Hill, and Windy Heights and Merritt Hill shall have received confirmation from the Farmers Home Administration that certain mortgages on the vineyard are in effect and that the proposed sale does not constitute a default.
In April, 1982, at the closing, plaintiff discovered that neither the policy nor the confirmation had been issued. Plaintiff thereupon refused to close and demanded return of its deposit. When defendants did not return the deposit, plaintiff instituted this action, asserting two causes of action, one for return of the deposit, and one for approximately $26,000 in consequential damages allegedly suffered as a result of defendants' failure to perform.
Special Term denied plaintiff's motion for summary judgment on both causes of action. The Appellate Division unanimously reversed Special Term's order, granted plaintiff's motion for summary judgment as to the cause of action for return of the deposit, and upon searching the record pursuant to CPLR 3212 (subd [b]), granted summary judgment in favor of defendants, dismissing plaintiff's second cause of action for consequential damages. Both plaintiff and defendants appealed from that decision. This appeal raises two issues: first, whether as a matter of *110 procedure, the Appellate Division could grant defendants summary judgment in the absence of a cross appeal, and second, if so, whether the Appellate Division, on the merits, correctly determined that the failure to supply the title insurance policy and mortgage confirmation obligated defendants to return plaintiff's deposit but did not subject them to liability for consequential damages. Because the Appellate Division was correct both as to procedure and as to substance, we affirm.
I
As matter of procedure, the Appellate Division had the authority to grant summary judgment to defendants even in the absence of a cross appeal by them.
On plaintiff's appeal from the denial of its motion for summary judgment, the Appellate Division was required to review the record to determine if any issues of fact existed as to either of plaintiff's causes of action which required a trial. After searching the record, the Appellate Division determined that no issue of triable fact existed as to either cause of action, that plaintiff was entitled to judgment as a matter of law on the first, but that defendants were entitled to judgment as a matter of law on the second. CPLR 3212 (subd [b]), provides that "[i]f it shall appear that any party other than the moving party is entitled to a summary judgment, the court may grant such judgment without the necessity of a cross-motion." Pursuant to that rule, the Appellate Division properly entered summary judgment in favor of defendants and dismissed plaintiff's second cause of action.
The question that next arises, however, is whether the Appellate Division could grant such relief in the absence of a cross appeal by defendants. While it is clear that this court could not grant summary judgment to a nonappealing party (Manes & Co. v Greenwood Mills, 53 N.Y.2d 759, 761; Kelly's Rental v City of New York, 44 N.Y.2d 700, 702; New York Cent. R. R. Co. v Beacon Milling Co., 293 N.Y. 218, 222), the Appellate Division is not so precluded. (Compare People v Consolidated Edison Co., 34 N.Y.2d 646, 648, with City of Rye v Public Serv. Mut. Ins. Co., 34 N.Y.2d 470, 474.) This court has consistently upheld the Appellate *111 Division's authority to grant such relief pursuant to CPLR 3212 (subd [b]), even in the absence of an appeal by the nonmoving party. (Taterka v Nationwide Mut. Ins. Co., 91 AD2d 568, 569, affd 59 N.Y.2d 743; Wehringer v Helmsley-Spear, Inc., 91 AD2d 585, affd 59 N.Y.2d 688; Freidus v Todem Homes, 80 AD2d 575, 577, affd 56 N.Y.2d 526; Howell v Davis, 58 AD2d 852, 853, affd 43 N.Y.2d 874; Peoples Sav. Bank v County Dollar Corp., 43 AD2d 327, 334, affd 35 N.Y.2d 836.)
Our recent decision in Hecht v City of New York (60 N.Y.2d 57) does not require otherwise. In reviewing a judgment entered on a jury verdict against multiple parties, we held in Hecht that in the absence of express statutory authority the Appellate Division could not award affirmative relief to one of the multiple defendants who did not appeal. Here, the basis for the Appellate Division's authority is CPLR 3212 (subd [b]).
Unlike this court, which has no original jurisdiction over motions and limited authority to review facts, the Appellate Division is a division of the Supreme Court (see NY Const, art VI, §§ 4, 7) and shares that court's power to search the record and award summary judgment to a nonmoving party even where, as here, the nonmovant did not appeal. As was aptly explained in language adopted by this court in De Rosa v Slattery Contr. Co. (14 AD2d 278, 280-281, affd 12 N.Y.2d 735):
"Rule 113 of the Rules of Civil Practice [the predecessor of CPLR 3212] provides judgment may be awarded to the opposing party even in the absence of a cross motion. Defendant Slattery did not ask for summary judgment either at Special Term or on appeal. It may be entitled to that relief, however, if it has a good defense to the action. The material facts are undisputed and mandate summary judgment dismissing the complaint * * *
"The Appellate Division, as the successor of the General Term, possesses all of the original jurisdiction of the Supreme Court, including the hearing and determination of motions * * * On an appeal from an intermediate order resulting in a reversal or modification, the Appellate Division generally entertains jurisdiction of and decides the underlying motion * * * The Court of Appeals, unlike the *112 Appellate Division, has no original jurisdiction of a motion in an action or proceeding, and in the absence of an appeal therefrom it has held that it is without power to decide it." (Citations omitted.)
Ever since its first appearance in this State by legislative enactment in 1921, summary judgment has offered an effective means for resolving disputes which present only questions of law. (See Paston, Summary Judgment in New York, chs III-VI; Kahn v City of New York, 37 AD2d 520, 521, affd 30 N.Y.2d 690.) "[T]he practicalities of frivolous litigation and court congestion mandate a summary procedure upon the ascertaining that there is no cause of action." (Senrow Concessions v Shelton Props., 10 N.Y.2d 320, 326.) This is as true when the infirmity in a cause of action or defense is ascertained by the Appellate Division as it is when that decision is made at Special Term. Once it determined that no issue of material fact existed as to plaintiff's second cause of action and that defendants were entitled to judgment as a matter of law, the Appellate Division had the power and responsibility to award summary judgment.
Thus, the order below was correct as a matter of procedure.
II
On the merits, plaintiff's right to return of its deposit or to consequential damages depends upon whether the undertaking to produce the policy and mortgage confirmation is a promise or a condition.
A promise is "a manifestation of intention to act or refrain from acting in a specified way, so made as to justify a promisee in understanding that a commitment has been made." (Restatement, Contracts 2d, § 2, subd [1].) A condition, by comparison, is "an event, not certain to occur, which must occur, unless its non-occurrence is excused, before performance under a contract becomes due." (Restatement, Contracts 2d, § 224.) Here, the contract requirements of a title insurance policy and mortgage confirmation are expressed as conditions of plaintiff's performance rather than as promises by defendants. The requirements are contained in a section of the agreement entitled "Conditions Precedent to Purchaser's Obligation to Close," *113 which provides that plaintiff's obligation to pay the purchase price and complete the purchase of the vineyard is "subject to" fulfillment of those requirements. No words of promise are employed.[*] Defendants' agreement to sell the stock of the vineyard, not those conditions, was the promise by defendants for which plaintiff's promise to pay the purchase price was exchanged.
Defendants' failure to fulfill the conditions of section 3 entitles plaintiff to a return of its deposit but not to consequential damages. While a contracting party's failure to fulfill a condition excuses performance by the other party whose performance is so conditioned, it is not, without an independent promise to perform the condition, a breach of contract subjecting the nonfulfilling party to liability for damages (Restatement, Contracts 2d, § 225, subds [1], [3]; 3A Corbin, Contracts, § 663; 5 Williston, Contracts [Jaeger-3d ed], § 665). This is in accord with the parties' expressed intent, for section 1 of their agreement provides that if defendants fail to satisfy the conditions of section 3 plaintiff's deposit will be returned. It does not provide for payment of damages.
On the merits of this case the Appellate Division thus correctly determined that plaintiff was entitled to the return of its deposit but not to consequential damages.
Accordingly, the order of the Appellate Division should be affirmed.
Order affirmed, without costs.
NOTES
[*] Plaintiff contends that the failure to produce the policy and confirmation is also a breach of section 5, entitled "Representations, Warranties and Agreements." A provision may be both a condition and a promise, if the parties additionally promise to perform a condition as part of their bargain. Such a promise is not present here. The only provision of section 5 conceivably relevant is that "Windy Heights has good and marketable title to the Property and all other properties and assets * * * as of December 31, 1980". But this is quite different from the conditions of section 3 that a title insurance policy and mortgage confirmation be produced at the closing, which took place in April, 1982. Both the complaint and plaintiff's affidavits are premised on nonperformance of section 3 of the agreement, not section 5. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3043177/ | United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 06-2902
___________
United States of America, *
*
Appellee, *
* Appeal from the United States
v. * District Court for the Southern
* District of Iowa.
Ruben Castillo-Vargas, *
* [UNPUBLISHED]
Appellant. *
___________
Submitted: September 6, 2007
Filed: September 17, 2007
___________
Before MURPHY, SMITH, and SHEPHERD, Circuit Judges.
___________
PER CURIAM.
Ruben Castillo-Vargas (Vargas) appeals the 70-month prison sentence the
district court1 imposed upon his guilty plea to illegal reentry after having been
deported following an aggravated felony conviction, in violation of 8 U.S.C. § 1326(a)
and (b)(2). Vargas’s counsel has moved to withdraw and filed a brief under Anders
v. California, 386 U.S. 738 (1967), questioning the reasonableness of the sentence and
the denial of a downward departure.
1
The Honorable James E. Gritzner, United States District Judge for the Southern
District of Iowa.
We conclude the sentence is not unreasonable. The district court considered
Vargas’s Guidelines imprisonment range, along with other 18 U.S.C. § 3553(a) factors
and Vargas’s arguments for a departure or a variance, in determining the sentence.
Nothing in the record suggests the district court failed to consider a relevant factor that
should have received significant weight, gave significant weight to an improper or
irrelevant factor, or considered only appropriate factors but in weighing those factors
committed a plain error of judgment. See United States v. Booker, 543 U.S. 220, 260-
62 (2005) (§ 3553(a) factors will guide reasonableness review); United States v.
Haack, 403 F.3d 997, 1003-04 (8th Cir. 2005) (reasonableness of sentence reviewed
for abuse of discretion; defining ways in which abuse of discretion may occur). We
also conclude that any sentence disparity arising from the unavailability of an early-
disposition program in the Southern District of Iowa does not make an otherwise
reasonable sentence unreasonable, see United States v. Sebastian, 436 F.3d 913,
915-16 (8th Cir. 2006), and that the district court’s discretionary denial of Vargas’s
downward-departure motion is unreviewable, see United States v. Morell, 429 F.3d
1161, 1164 (8th Cir. 2005).
Having reviewed the record under Penson v. Ohio, 488 U.S. 75 (1988), we find
no nonfrivolous issues. Accordingly, we grant counsel’s motion to withdraw, and we
affirm.
______________________________
-2- | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1736284/ | 519 So. 2d 119 (1988)
Lester JACKSON, Individually and as Administrator for the Minor Child Kerick Jackson and Bertha Jackson
v.
Dr. Ta Yu HUANG and Insurance Company of America.
No. 87-C-2794.
Supreme Court of Louisiana.
January 29, 1988.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583047/ | 51 F. Supp. 733 (1943)
NEW YORK TRUST CO. et al.
v.
UNITED STATES.
Court of Claims.
October 4, 1943.
*734 Charles C. Parlin, of New York City (John A. Reed and Wright, Gordon, Zachry, Parlin & Cahill, all of New York City, on the brief), for plaintiffs.
Elizabeth B. Davis, of Washington, D.C., and Samuel O. Clark, Jr., Asst. Atty. Gen. (Robert N. Anderson and Fred K. Dyar, both of Washington, D.C., on the brief), for defendant.
Before WHALEY, Chief Justice, and LITTLETON, WHITAKER, and MADDEN, Judges.
LITTLETON, Judge.
Laura H. Jennings died July 8, 1939. February 13, 1924, she executed an irrevocable trust instrument under the terms of which the income from the trust was to be paid to her for life. At her death the principal or corpus of the trust was to be divided into shares, the income paid to her three children if then living and the principal to go ultimately to persons appointed by them or their children or their heirs.
The Commissioner of Internal Revenue held that the value of the trust property so transferred in this irrevocable trust of 1924 was includable in the decedent's gross estate for the purpose of determining the value of the net estate subject to tax as a "transfer to take effect in possession or enjoyment at or after death," under section 811(c), Internal Revenue Code.
The sole question presented here is whether the retention by the settlor-decedent during her life of the income of the *735 1924 trust requires the value of the corpus of the trust fund to be included in the gross estate upon her death July 8, 1939, as an interest intended to take effect in possession or enjoyment at or after death within the meaning of the applicable provisions of the estate-tax provisions of the pertinent taxing acts.
At the time the decedent created the trust in question on February 13, 1924, the Revenue Act of 1921, 42 Stat. 227, 278, was in effect and section 402(c) thereof provided: "That the value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated to the extent of any interest therein of which the decedent has at any time made a transfer, or with respect to which he has at any time created a trust, in contemplation of or intended to take effect in possession or enjoyment at or after his death (whether such transfer or trust is made or created before or after the passage of this Act), except in case of a bona fide sale for a fair consideration in money or money's worth." This provision was re-enacted in section 302(c) of the Revenue Act of 1924 and in section 302(c) of the Revenue Act of 1926, 26 U.S.C.A. Int.Rev.Acts, pages 67, 227. No change was made in the language of the Revenue Act of 1926 until the approval of the Joint Resolution of Congress on March 3, 1931, 26 U.S.C.A. Int.Rev.Acts, page 227. By that Joint Resolution subsection (c) was amended to read as follows (the italicized portion being the amendment added by the Joint Resolution): "To the extent of any interest therein of which the decedent has at any time made a transfer, by trust or otherwise, in contemplation of or intended to take effect in possession or enjoyment at or after his death, including a transfer under which the transferor has retained for his life or any period not ending before his death (1) the possession or enjoyment of, or the income from, the property or (2) the right to designate the persons who shall possess or enjoy the property or the income therefrom; * * *."
Prior to approval of Joint Resolution 529, of March 3, 1931, 46 Stat. 1516, 26 U.S.C.A. Int.Rev.Act page 227, no part of the value of trust property, or fund, under an irrevocable trust instrument, such as is involved in this case, was includable in the gross estate of the decedent as a gift or transfer to take effect in possession or enjoyment at or after death because the decedent retained the income of the trust during his lifetime. May et al., Executors, v. Heiner, 281 U.S. 238, 239, 50 S. Ct. 286, 74 L. Ed. 826, 67 A.L.R. 1244; Burnet v. Northern Trust Co., 283 U.S. 782, 51 S. Ct. 342, 75 L. Ed. 1412; Morsman, Administrator, v. Burnet, 283 U.S. 783, 51 S. Ct. 343, 75 L. Ed. 1412; McCormick v. Burnet, 283 U.S. 784, 51 S. Ct. 343, 75 L. Ed. 1413.
In May v. Heiner, supra, decided April 14, 1930, the income of the trust fund was payable to the husband of the settlor-decedent for his life and after his death the income was payable to the decedent during her lifetime with remainder over to her children. The court held that this was not a gift intended to take effect in possession or enjoyment at or after death. In Burnet v. Northern Trust Co., supra, and in the other two cases cited, which were decided at the same time on March 2, 1931, the court held that where under a trust instrument the income was payable to the settlor during his lifetime and upon his death the trust was to terminate and the property was to be distributed among his children, no part of the trust fund was includable in the gross estate of decedent as a gift intended to take effect in possession or enjoyment at or after death.
The Joint Resolution of March 3, 1931, amending section 302(c) of the Revenue Act of 1926, was passed as a result of decisions of the Supreme Court in the Northern Trust Company, Morsman, and McCormick cases above cited on March 2. The Joint Resolution of March 3, 1931, was not retroactive and did not apply to property transferred by an irrevocable trust created prior to date of its approval. Hassett v. Welch, et al. (Helvering v. Marshall, Administrator), 303 U.S. 303, 307, 58 S. Ct. 559, 82 L. Ed. 858. The Hassett and Marshall cases were decided in 1938 and held that no part of the value of a trust fund created prior to March 3, 1931, is subject to an estate tax because of the retention by the settlor of the income therefrom for his life.
Defendant argues that the decisions in May v. Heiner, supra, and Burnet v. Northern Trust Co., supra, were overruled in Helvering v. Hallock et al., Trustees, 309 U.S. 106, 60 S. Ct. 444, 84 L. Ed. 604, 125 A.L.R. 1368. We do not agree with this contention. The Hallock case dealt only with the effect, for tax purposes, of *736 the reservation by the settlor of a reversionary interest in the corpus of the trust property which it was held was a sufficient beneficial interest in the trust property to justify the inclusion of the value of the trust property in the gross estate as an interest which ceased by reason of death, the court saying, at page 112 of 309 U.S., at page 448 of 60 S.Ct., 84 L. Ed. 604, 125 A.L.R. 1368, in commenting upon Klein v. United States, 283 U.S. 231, 51 S. Ct. 398, 75 L. Ed. 996, "By bringing into the gross estate at his death that which the settlor gave contingently upon it, this Court fastened on the vital factor."
In the Hallock case the court decided only that the retention of a possibility of reversion of the trust property to the settlor required the inclusion of the value of the trust property in the gross estate, and made no reference to the effect of retention for life of the income of an irrevocable trust, a far different question which had been settled in prior decisions to which no reference was made. We cannot hold that the opinions in May v. Heiner, Burnet v. Northern Trust Co., and Hassett v. Welch, supra, were overruled by inference by the opinion in Helvering v. Hallock, supra.
In filing the federal estate-tax return on which a tax of $557,210.87 was computed and paid, the executors computed such tax by deducting the full 80 per cent credit for New York estate and inheritance taxes allowed by section 813(b) of the Internal Revenue Code (finding 3). Upon audit of the return the defendant asserted a net deficiency in Federal estate tax after making a provisional allowance of $357,048.62 on account of an allowable 80 per cent credit for state estate and inheritance taxes provided by section 813(b), supra. It is not possible at this time to determine the exact amount of overpayment of federal estate tax made by plaintiffs for the reason that the exact amount of the New York estate and inheritance tax liability cannot be ascertained until the issue in this case as to whether the trust property is or is not taxable is determined. The New York State tax officials have been unwilling to determine the amount of the estate-tax liability until the issue presented in this case is determined.
Judgment in favor of plaintiffs for the exact amount of overpayment of the federal estate tax made as a result of the erroneous inclusion in the gross estate of the value of the trust fund at the date of decedent's death, after allowance of the full 80 percent for New York estate and inheritance taxes, as provided for by section 813(b) of the Internal Revenue Code, will be entered upon the filing by the parties of a stipulation as to the amount of the credit for New York taxes and of the correct amount of refund of federal estate tax due. If the parties are unable to stipulate the correct amount of overpayment to be included in the judgment, the case will be referred to a commissioner of the court for the taking of proof and the making of a report to the court in the premises. It is so ordered.
JONES, Judge, took no part in the decision of this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583090/ | 728 N.W.2d 225 (2006)
IN RE N.A.C.
No. 06-1590.
Iowa Court of Appeals.
December 13, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583097/ | 31 So. 3d 538 (2010)
Terry SMITH, Individually and F & S EMT, Inc. Plaintiff-Appellant,
v.
RICHLAND PARISH POLICE JURY, Defendant-Appellee.
No. 44,951-CA.
Court of Appeal of Louisiana, Second Circuit.
January 27, 2010.
*539 Theodore J. Coenen, IV, Theo J. Coenen, III, Rayville, for Appellant.
David P. Doughty, Rayville, for Appellee.
Before BROWN, STEWART and CARAWAY, JJ.
CARAWAY, J.
An unsuccessful bidder sought an injunction against a parish police jury seeking to stop the award of a gravel hauling contract to another bidder on the grounds that the bidding process violated the public works law. The police jury reconvened for a declaratory judgment and filed exceptions to the petition for injunction. The trial court rendered declaratory judgment upholding the action of the police jury and granted both exceptions. The unsuccessful bidder appeals. Finding that the peremptory exception of no cause of action applies to all claims against the police jury, we affirm the dismissal of plaintiff's claims and find the declaratory judgment moot.
Facts
The Richland Parish Police Jury ("Police Jury") advertised for public bids for a contract for the hauling of gravel. In relevant part, the advertisement read as follows:
Separate sealed bids for furnishing the following materials for a period of one (1) year, effective January 1, 2009, through December 31, 2009, will be received by the Richland Parish Police Jury, Fourth Floor, Courthouse Building, Rayville LA, Until 6:00 P.M. (Local Time), Monday December 01, 2008. Bids will be opened and publicly read aloud during the regularly scheduled Police Jury meeting to be held December 01, 2008, beginning at 6:00 P.M.
* * *
The Richland Parish Police Jury reserves the right to waive any and/or all informalities and accept or reject any or all bids.
F & S EMT, Inc., through its president, Terry Smith (hereinafter "Smith"), submitted a bid in response to the advertisement. The bid contained the following notation: "Fuel surcharges will be applied according to the inflation of fuel cost."
At the scheduled December 1, 2008 meeting, four bids were received and opened for the 2009 gravel hauling contract. The bids included Smith's, on behalf of F & S, EMT, Inc., and a bid by Larry Harris ("Harris"), on behalf of Delhi Dump Truck, LLC ("DDT").
The time of Harris's submission of the DDT bid became the focus of dispute prompting this litigation. Harris claims that he was present at the meeting at 6:00 p.m. with the bid in hand and turned the bid in to the Police Jury on or before 6:00 p.m. by placing an unstamped and unidentified envelope on the police jury table prior to the beginning of the meeting. Conflicting versions of the event suggest that Harris placed the bid on the jury table just prior to the time that the bids were called, opened and publicly read at approximately 8:30 p.m. The parties agree *540 that the four bids were opened and read at that time.
The Police Jury took the award of the contract under advisement until the next scheduled regular meeting of January 12, 2009. At that meeting the Police Jury unanimously accepted the bid of DDT as the lowest bid for the hauling contract. At the February 2, 2009 regularly scheduled Police Jury meeting, a motion was made and carried "to turn over the acceptance of the hauling bids for 2009 to the District Attorney and call for a Special Meeting with the attorney and Police Jury." A special meeting of the Police Jury was convened on February 17, 2009. The minutes show that a motion was carried for the Police Jury to enter into executive session "to discuss hauling bids." Subsequently, a second motion was carried to reconvene the regular session and the meeting was adjourned.
On February 26, 2009, Smith filed this action as a petition for injunction against the Police Jury seeking to enjoin it "from executing any contract with Delhi Dump." The petition claimed that the DDT bid was not timely submitted before the 6:00 p.m. deadline for submission of bids. No order setting the date of an injunctive hearing was requested, and no date was ever officially set.
In a pleading entitled, "Petition for Declaratory Judgment and Exceptions," the Police Jury made response to Smith's injunction action on March 27, 2009. The pleading was filed under the same suit number. Yet, it did not set forth that is was a reconventional claim. The Police Jury named Smith and DDT as defendants in its reconventional claim to determine whether the acceptance of DDT's bid was proper under Louisiana Public Bid Law. The Police Jury alleged "that at the time of the District Attorney investigation into this matter, the Delhi Dump Truck, LLC bid had already been accepted as the low bid, and hauling was occurring by Delhi Dump Truck." The Police Jury further alleged that DDT's bid was not disqualified because all bids were opened together and that Smith's bid was non-responsive because the fuel surcharge was not defined. The Police Jury requested that the declaratory judgment be heard on April 27, 2009, the date allegedly scheduled for the preliminary injunction hearing.
The Police Jury also filed exceptions to Smith's petition for injunction on the grounds of prematurity and improper use of summary proceedings. In particular, because the contract was awarded on January 12, 2009, and the Police Jury had begun purchasing gravel from DDT, the Police Jury argued that Smith no longer had a right to seek injunctive relief.
Hearing on the declaratory judgment occurred on April 29, 2009. The case proceeded with the Police Jury calling its witnesses and presenting its case for declaratory judgment despite no answer to that action having been filed by Smith. The record does not clearly indicate that the hearing involved Smith's preliminary injunction request. Eight of the parish police jurors involved in the subject bidding process, who were present at the December 1 Police Jury meeting, testified. Additionally, both Smith and Harris took the stand.
Harris testified that this was his first public bid and that when he got to the fourth floor, "there was nobody there except for in the meeting." He testified that he did not "go to any office because nobody was[ ] in the office." He claimed that he had his bid in hand when he arrived for the meeting before 6:00 p.m. He stated that he walked into a preliminary meeting and a gentleman told him to give the bid to Larry Wheeler, the parish manager. Harris "put the envelope right in front of him *541 on the table" and then sat down. Harris testified that his bid was turned in before 6:00 p.m. Harris explained that the lack of his company's name on the envelope precipitated Wheeler to ask what the envelope was. Harris testified that he informed Wheeler that the bid was for DDT. Harris also stated that when the issue of the timing of his bid was made, DDT had begun work under the contract.
Terry Smith testified that he recalled Harris arriving at the Police Jury meeting after 6:00 p.m. and that the Police Jury got to the bids at approximately 8:30 p.m. Smith testified that he saw Harris turn in his bid at the time of the opening of the bids.
Larry Wheeler testified that at the subject Police Jury meeting, he opened the bids. Wheeler could not recall whether DDT's bid was handed to him prior to the meeting, but he knew that the bid was among the other bids that were placed on the table. He also remembered that the envelope was blank which caused him to inquire about what it was.
Each of the police jurors testified to their familiarity with the bidding process in question. The jurors were inconsistent in their testimony regarding whether Harris was present before the meeting began and when he placed the bid on the table. All agreed that the bids were opened and read together and that Wheeler inquired about DDT's bid.
After considering the testimony and evidence, the trial court granted declaratory judgment in favor of the Police Jury finding that "the Richland Parish Police Jury properly accepted the bid of Delhi Dump Truck, LLC for 2009 gravel hauling. The bid of Delhi Dump Truck, LLC was the lowest and most definite bid, and it is the Court's finding that the bid was timely received." The court also sustained the Police Jury's exceptions of prematurity and unauthorized use of summary proceedings. Smith now appeals contesting the declaratory judgment and the manner in which the DDT bid was accepted at the December 1 meeting.
Discussion
The initial action taken by Smith contesting his unsuccessful bid on a public contract is authorized under La. R.S. 38:2220, which provides, in pertinent part, as follows:
A. Any purchase of materials or supplies, or any contract entered into for the construction of public works, contrary to the provisions of this Part shall be null and void.
B. The district attorney in whose district a violation of this Part occurs, the attorney general, or any interested party may bring suit in the district court through summary proceeding to enjoin the award of a contract or to seek other appropriate injunctive relief to prevent the award of a contract which would be in violation of this Part, or through ordinary proceeding to seek appropriate remedy to nullify a contract entered into in violation of this Part.
The leading case interpreting the right of injunctive relief of an unsuccessful bidder is Airline Const. Co., Inc. v. Ascension Parish School Bd., 568 So. 2d 1029 (La. 1990). Airline was an action for damages by an unsuccessful bidder against a school board in which the supreme court sustained an exception of no cause of action. The court's ruling dismissing the suit noted that the petition did not state whether the project was completed when the suit was filed, whether a suit for injunction had been timely filed or whether "circumstances existed which made the filing of a timely suit for injunction impossible." Id. at 1035. In granting the exception of no cause of action, the court explained:
*542 The public contracts law is a prohibitory law, founded on public policy, which was enacted in the interest of the taxpaying public. The purpose of the law is to prevent public officials from awarding contracts on the basis of favoritism or at possibly exorbitant and extortionate prices.
In a public project advertised for public bidding, there is no contractual relationship between an unsuccessful bidder and the public body who advertises for bids. However, although an unsuccessful bidder does not have a cause of action in contract against the public body, the lowest responsible bidder does have a cause of action to challenge timely the rejection of his bid and to compel the award of the contract to him. Louisiana jurisprudence has long recognized that while a public body has some discretion in awarding public contracts, subject to judicial review, an unsuccessful bidder may sue to enjoin the public body from executing the contract or to set aside the award of the contract to another bidder when the public body acted arbitrarily in selecting the successful bidder.
In 1979 the Legislature amended La. R.S. 38:2220 to recognize expressly this right to injunctive relief when a public body violates the public contract law and to authorize a civil penalty against a member of the public body who authorizes the violation. The statute, however, neither authorizes nor denies a cause of action for damages against the public body.
In the present case the Board's exception of no cause of action asserts that an unsuccessful bidder does not have a cause of action under any circumstances to recover damages against a public body which awards a public contract in violation of the public bid law. We do not reach this broad issue, but rather decide this case on the narrower holding that an unsuccessful bidder on a public contract who fails to resort to the relief granted by statute by attempting to enjoin timely the execution or the performance of the contract, when the facts necessary for injunctive relief are known or readily ascertainable by the bidder, is precluded from recovering damages against the public body.
Airline Const., supra at 1032-1033 (citations omitted).
The overriding question which is therefore presented in this dispute is whether Smith followed the Airline ruling in filing this suit and pursuing his claim. Following the December 1, 2008 opening of the bids at the Police Jury meeting, Smith waited until February 26, 2009, to seek injunctive relief. He did so despite his belief regarding Harris's late arrival at the December meeting and the untimely submission of the DDT bid. Smith also knew that the Police Jury had not rejected DDT's bid at the December meeting and that it had in fact awarded DDT the contract in January. Smith's petition for injunctive relief made no allegation that circumstances existed which prevented him from filing the suit before the award of the contract, and indeed his actual testimony confirms his knowledge of DDT's filing of its bid which he alleges to have been untimely.
In partial response to Smith's claims, the Police Jury filed an exception which it labeled an "Exception of Unauthorized Use of Summary Proceedings." The legal reasoning presented in support of the exception, however, claimed that injunctive relief was unavailable to Smith since the public contract had been previously awarded and work on the contract had begun. With such argument, the Police Jury was effectively claiming that Smith no longer had a cause of action in accordance with *543 the ruling in Airline, even though the Airline decision was never specifically cited to the court. In addition, the Police Jury filed a separate claim for declaratory judgment in which it asserted its defense that the public bid law had not been violated.
From this review of Smith's claim and the narrow relief which the Airline ruling and La. R.S. 38:2220 afford to an unsuccessful bidder on a public contract, we affirm the trial court's grant of the Police Jury's exception which substantively raised the peremptory challenge of no cause of action.[1] We further deny any allowance for amendment of Smith's petition under La. C.C.P. art. 934 for any possible damage claim left unanswered by the Airline ruling, since the evidence demonstrates that Smith was not prevented by any circumstances from timely seeking mandatory injunctive relief for the award of the contract in his favor.
With this ruling, the issue of the trial court's judgment on the Police Jury's claim for declaratory relief is moot, as the matter has been fully adjudicated by the enforcement of the peremptory exception for the dismissal of all claims arising from this public bid law transaction.
Conclusion
For the reasons noted above, we grant the peremptory exception of no cause of action and affirm the dismissal of Smith's claims against the police jury thereby mooting the declaratory judgment. Costs of this appeal are assessed to Smith.
AFFIRMED.
NOTES
[1] The court shall give substance to the pleading and exception regardless of its label. Ken Lawler Builders, Inc. v. Delaney, 36,263 (La. App.2d Cir.8/14/02), 837 So. 2d 1; Steed v. St. Paul's United Methodist Church, 31,521 (La. App.2d Cir.2/24/99), 728 So. 2d 931, writ denied, 99-0877 (La.5/7/99), 740 So. 2d 1290. Additionally, the court of appeal on its on motion can raise the peremptory exception of no cause of action. La. C.C.P. art. 927 B. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582571/ | 62 N.W.2d 288 (1954)
157 Neb. 867
E. K. BUCK RETAIL STORES et al.
v.
HARKERT et al.
No. 33356.
Supreme Court of Nebraska.
January 15, 1954.
*292 Hotz & Hotz, Robert M. Kane, William F. Dalton, Omaha, for appellants.
Kennedy, Holland, DeLacy & Svoboda, Omaha, for appellees.
Before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.
CARTER, Justice.
This is a suit for a declaratory judgment brought by E. K. Buck Retail Stores, a corporation, and Earl K. Buck against Walter E. Harkert and Mercedes C. Harkert, and Harkert Houses, a corporation, to test the validity of a corporation control agreement entered into by the parties in their capacities as stockholders in Harkert Houses. The trial court disposed of the issues raised by holding two separate trials and entering two decrees. The first decree was entered on October 29, 1951, in which it was determined that the agreement was in all respects valid, the defendants, Harkert were restrained from violating said agreement, the defendants Harkert were ordered to perform in accordance with the terms of the agreement, the prayer of the plaintiffs for a declaration that the corporate election of January 16, 1950, was invalid was denied, and all claims of the defendants, including those for damages, were denied. A second agreement between the parties bearing date of July 7, 1938, similar in nature, was also held valid. The court granted permission to plaintiffs to seek further relief in damages based on the judgment and decree, and retained jurisdiction of the case for this purpose. The second decree was entered on January 14, 1953, in which it was determined that plaintiffs were entitled to judgment against the defendants Harkert in the amount of $33,612 and that defendants' motions for judgment notwithstanding the findings of the court should be overruled. On February 3, 1953, all motions for a new trial were severally overruled. This was a final order as to the decree of October 29, 1951, and that of January 14, 1953. The defendants Harkert have appealed from this order. In order to simplify the disposition of the issues we shall deal first with those involved in the first trial which resulted in the decree of October 29, 1951.
The record shows that Walter E. Harkert, hereafter referred to as Harkert, was on and before the latter part of 1937 the sole owner of a chain of restaurants or hamburger stands. His finances became impaired in the period prior thereto to the extent that he was compelled to seek financial aid from sources other than banking institutions. He engaged in a plan of selling the fixtures and equipment at a designated eating house or stand to the investor for cash and entering into an agreement to buy the fixtures and equipment back at the end of 5 years for a higher price, payment to be made in monthly installments over the 5-year period. Several of these sale and repurchase agreements had been entered into before Harkert became acquainted with Earl K. Buck, hereafter referred to as Buck. Harkert and Buck became acquainted, with the result that Buck entered into four purchase and resale agreements with Harkert prior to the incorporation of the Harkert restaurants. In the latter part of 1937 Harkert was desirous of improving his financial structure, and broached the subject to Buck. Buck advised Harkert to consult with Buck's lawyer with reference to the matter. The incorporation of the *293 Harkert interests under the name of Harkert Houses resulted, undoubtedly with the expectation that Buck would be interested in advancing more money in the furtherance of his interests and those of the new corporation. An auditor calculated the net worth of the business as this time to be $47,504.38. This figure was admittedly arrived at by not treating the payments on repurchase agreements, which became due more than 1 year thereafter, as a liability in his calculation of the net worth of Harkert. These deferred payments amounted to $41,042 and, if deducted as a liability, would have fixed Harkert's net worth at $6,462.38, exclusive of good will and the value of the business as a going concern. All of this Buck knew and no contention is made that he was misled thereby.
From this point on we shall refer to the E. K. Buck Retail Stores, Buck, and Devor, as Buck, their interests being identical so far as this litigation is concerned. The evidence shows that Harkert at this time was obligated on repurchase agreements and other forms of indebtedness in the sum of $44,750 to persons other than Buck. Harkert was indebted to Buck in the gross face amount of $55,650. An agreement was made whereby Buck would cancel this gross amount of $55,650 and pay $53,625 in cash into the business for which he was to receive as a consideration therefor 40 percent of the stock of Harkert Houses and equal representation on the board of directors of the corporation. Figuring the gross amount of the indebtedness of Harkert to Buck at its then present value, it appears that Buck actually invested a total of $90,725 in Harkert Houses. The evidence shows that Buck paid in the $53,625, $44,750 of which was used to pay the assumed obligations of Harkert by Harkert Houses, and $8,875 was paid to Harkert as a part of the stock transaction, all with the full knowledge of Buck.
As hereinbefore indicated, Buck and those for whom he acted were to receive 40 percent of the stock of the company and equal control on the board of directors of the Harkert Houses. The pertinent part of the contract so providing states: "That the number of the members of the Board of Directors of Harkert Houses be reduced from five, as it now is, to the number of four, and that the said four members of the new Board shall consist of said Walter E. Harkert, Mercedes C. Harkert, his wife, Earl K. Buck and Rodney B. Devor, and that the number of members of said Board of Directors shall be maintained at four in number, of which at all times two thereof shall be such persons as shall be nominated or designated by the said Walter E. Harkert or his heirs, representatives or legatees, and the other two thereof shall be such persons as shall be nominated or designated by the said party of the second part. And it is further mutually agreed between the parties that at all stockholders' meetings of the said Harkert Houses held for the purpose of election of directors or director (in case of vacancy on the Board of Directors), that all of the said shares of stock of parties of the first part and also of party of the second part and also any additional shares of stock of the Harkert Houses which may be subsequently acquired by the said parties or either of them, shall be voted in such manner and for such person or persons as will keep and maintain the Board of Directors four in number, of which two thereof shall be such persons as shall be nominated or designated by said Walter E. Harkert or his heirs, representatives or legatees, and two thereof shall be such persons as shall be nominated or designated by the said party of the second part."
It is contended by the defendants that the foregoing portion of the agreement violates Article XII, section 5, of the Constitution, and section 21-135, R.S.1943, and, in addition thereto, contravenes the public policy of the state and is void for that reason. It will be noted that the statute was enacted pursuant to the mentioned constitutional provision and that the two are similar insofar as their substance is concerned. They will therefore be considered together.
The pertinent part of Article XII, section 5, of the Constitution, is as follows: "The Legislature shall provide by law that in all *294 elections for directors or managers of incorporated companies every stockholder shall have the right to vote in person or proxy for the number of shares owned by him, for as many persons as there are directors or managers to be elected or to cumulate said shares and give one candidate as many votes as the number of directors multiplied by the number of his shares shall equal, or to distribute them upon the same principle among as many candidates as he shall think fit, and such directors or managers shall not be elected in any other manner; * * *."
The contract here involved was entered into on May 23, 1938, by Walter E. Harkert and Mercedes C. Harkert as parties of the first part and the E. K. Buck Retail Stores as the party of the second part. On the date of the agreement Harkert was the owner of 2,637 shares of stock in Harkert Houses and Mercedes C. Harkert was the owner of 300 shares. The E. K. Buck Retail Stores became the owner of 1,198 shares on the day the contract was made and Buck and Rodney P. Devor became the owners of one share each. Harkert retained 1,437 shares and Mercedes C. Harkert retained 300 shares. There were a number of shares of stock held by persons not signatory to the agreement after the completion of the stock transaction. The contract was between the parties as stockholders. They involved no action on the part of the corporation. So far as the record shows, the board of directors, officers, or stockholders as such had no knowledge of the transaction. The E. K. Buck Retail Stores was a corporation operating a chain of shoe stores and was not, consequently, a competitor of Harkert Houses in the restaurant business.
In considering the meaning of Article XII, section 5, of the Constitution, and section 21-135, R.S.1943, it is proper to consider the evil and mischief attempted to be remedied, the objects sought to be accomplished, the scope of the remedy its terms apply, and give it such an interpretation as appears best calculated to effectuate the design of the constitutional and legislative provisions. It is clear to us that the purpose of the constitutional provision and statute enacted pursuant thereto was to provide for cumulative voting in the election of directors or managers of incorporated companies in order to secure to minority stockholders a greater representation in the management of the corporation's business. In order to do this it was necessary that the law state the number of votes to which each stockholder was entitled and to insure against an involuntary loss of the right conferred. In the accomplishment of the latter, the Constitution provides that "such directors or managers shall not be elected in any other manner". The latter prohibition, as we view it, operates to prevent a corporation by its articles of incorporation, by-laws, or any act of its directors or stockholders from depriving a stockholder of the right to vote his stock in the manner specified in the Constitution and statute. But such provision does not purport to limit the right of the stockholder to contract with reference to his stock. It grants him a right or privilege which he may or may not exercise as he sees fit, but it is one of which the corporation or any agency thereof cannot deprive him. Neither the constitutional provision nor the statute purports to limit the right of the stockholder to contract with other stockholders with respect to such right. The nature of the right granted by the Constitution and statute appears to have been concisely stated in Tomlin v. The Farmers' & Merchants' Bank, 52 Mo.App. 430, wherein the court said: "The right is one guaranteed by the law, constitutional and statutory, it is personal to the stockholder, it can be exercised or not by such stockholder as he may himself elect. * * * It, therefore, cannot be taken from him by a resolution or by-law adopted by a majority of shareholders."
In State ex rel. Frank v. Swanger, 190 Mo. 561, 89 S.W. 872, 876, 2 L.R.A.,N.S., 121, the court in dealing with a similar provision said: "The object and purposes of this provision in our Constitution is well understood, and has been judicially expounded on several occasions. Its purpose *295 was to introduce the principle of cumulative system of voting in elections of stockholders so as to secure to the minority of stockholders a voice in the management of the affairs of the company in proportion to the number of their shares, * * *. A construction has nowhere been given to section 6, art. 12, within our knowledge or research, so as to constitute it a prohibition or restriction on the right of stockholders to make their contracts which violate no rule of the common law, and which affect no rights, except their own."
The result necessarily hinges upon the meaning to be given to the words "and such directors or managers shall not be elected in any other manner". It will be noted that Article XII, section 5, of the Constitution provides that every stockholder shall have the right to vote in person or proxy for directors or managers on a stock ownership basis for as many as there are directors to be elected, and he may cumulate his vote and distribute it among the candidates as he sees fit. Then follows the provision that directors shall be elected in no other manner.
We think the meaning of the constitutional provision is clear. Its purpose is to provide for cumulative voting in the accomplishment of which it was necessary to fix the voting power of the shares of stock. In many states cumulative voting is permissive,it could be properly included in the articles of incorporation, or not, as the incorporators might determine. The clause "and such directors or managers shall not be elected in any other manner" was placed in Article XII, section 5, of the Constitution, to make it mandatory that every corporation within the purview of the constitutional provision should permit cumulative voting.
It is contended that the provision intended much more than that from its plain, unambiguous language, that it meant also that any agreement between stockholders, even though accompanied by a valuable consideration, was voided by the provision that such directors shall not be elected in any other manner. We point out that the elections of directors after the agreement of May 23, 1938, were held in accordance with the method prescribed in Article XII, section 5, of the Constitution. For that matter, the elections held after the breach of the agreement likewise were held in the manner prescribed. It will be noted that each share of stock was given one vote, the right to cumulate was not denied and, for aught the record shows, the voting power of the stock was in no way reduced. It is asserted, however, that an agreement between stockholders as to how stock shall be voted at the election of directors ipso facto changes the manner of election prescribed by the Constitution. To so hold would have the effect of invalidating existing statutes relating to voting trusts and all other forms of voting combines by a majority of the stock to control the management of the corporation, which were recognized at common law. The Constitution so construed would be superior to any statute in conflict therewith. We do not think the framers of the Constitution had any such intention and, if they had, adequate language could easily have been found to have expressly so provided. It was clearly the purpose of Article XII, section 5, of the Constitution, to secure to minority stockholders a voice in the management of the affairs of the corporation in proportion to the number of their shares. We can find nothing in this section which purports to change the then existing rights of a stockholder to contract with another stockholder with reference to how he should vote his stock.
Elaborate briefs have been filed by the parties dealing with the issues of this case. To discuss all of the cases cited and the distinctions drawn by the parties would unduly extend this opinion. On the constitutional issue, however, the defendants rely mainly upon two cases upon which we will venture to comment. These cases are People ex rel. Arkansas Valley Sugar Beet & Irrigated Land Co. v. Burke, 72 Colo. 486, 212 P. 837, 30 A.L.R. 1085, and Brooks v. State ex rel. Richards, 3 Boyce, Del., 1, 79 A. 790, 51 L.R.A.,N.S., 1126.
*296 In the Burke case it appears that the water storage company, desiring to build an irrigating and storage system of its own, entered into an agreement with the receiver of the old canal company for the joint use of a part of its existing canal. A new canal company was organized and the old canal company stockholders were to receive stock in the new company. For the purpose of giving representation to the storage company, in the problems involved in maintaining and operating that part of the canal jointly used, the contract for the joint use of the canal provided also that the stockholders of the new canal company would annually vote for and elect as two of its five directors two stockholders of their own number to be designated by the storage company. The two corporations were rival and competitive companies whose rights and interests were antagonistic and adverse to the rights and interests of their own corporation. The right of the storage company was not contingent on its being a stockholder. It appears plain to us that the receiver was acting for the corporation and all of the stockholders thereof. If this be true, the provision for the election of the two stockholders nominated by the storage company to be directors constituted a corporate limitation on the power of stockholders to vote cumulatively or otherwise for all directors to be elected. Such a holding would, of course, be in line with our interpretation of Article XII, section 5, of the Nebraska Constitution,the constitutional provision of the Colorado Constitution being identical with ours for all practical purposes. In the decision, however, the Colorado court went further and held that the words [72 Colo. 486, 212 P. 841] "And such directors, trustees or managers shall not be elected in any other way" meant more than the establishment of a cumulative method of voting. The court said: "The language is plain and unambiguous. It is not susceptible of construction. It interprets itself. It is an absolute, unequivocal command that the directors shall not be elected in any other way than the way or ways which the section itself specifically provides. The sentence was not intended to establish cumulative voting. That object had been accomplished by previous provisions of the section. The inhibition is no more applicable or appropriate to cumulative voting than to voting by a stockholder of all his shares for as many directors as are to be elected; that is, two methods of votingcumulative and noncumulativeare provided, and the nominating and electing by either method is the same." The court held the contract viod on its face for the reasons set out in the opinion at considerable length. The court did not say, as the defendants here contend, that all agreements between stockholders relating to the voting of stock were void. It did say: "Such being our conclusion, it is unnecessary to determine whether all separations of voting power from beneficial ownership, all irrevocable powers of attorney for the voting of the stock, or all voting trust agreements, are invalid." We think that the Colorado court meant that the canal company violated the constitutional provision when it attempted to limit the right of its stockholders to elect its directors, by the cumulative method or otherwise, when it contracted with reference thereto with the storage company in the manner in which it did. But it was not a case where two stockholders contracted for a consideration with reference to the voting of their stock. If the holding of the Colorado court has the effect that the defendants claim for it, we have no hesitancy in saying that it is not sustained by the better reasoning.
In the Brooks case the Delaware court was called upon to determine the right of the owners of preferred shares of stock to vote at the election of directors. The constitutional provision was similar to Article XII, section 5, of the Nebraska Constitution. The articles of incorporation of the company involved purported to deprive the owners of preferred stock of the right to vote for directors. A statute enacted subsequent to the adoption of the *297 constitutional provision authorized such a provision in the articles of incorporation. The court held that the holders of the preferred stock were entitled to vote their stock under the constitutional provision. It will be noted that the prohibition of the constitutional provision operated against the corporation providing restrictive methods of electing directors. We find nothing in the opinion touching upon the right of stockholders to contract with each other with reference to how they will vote their stock. We think the defendants claim too much for the Burke and Brooks cases.
It is next contended that the agreement of May 23, 1938, was void as being against public policy. It is claimed that the public policy of this state is derived from Article XII, section 5, of the Constitution, and the implementing statute to which we have referred. Our discussion of the validity of the agreement as the constitutional provision relates to it tends to dissolve this issue. If, as we have said, control agreements between stockholders are not ipso facto void because of the constitutional provision, certainly no public policy can be gleaned therefrom which would void the agreement. No other source of public policy is asserted other than the constitutional provision and the implementing statute. We desire to make it clear, however, that in holding that the constitutional provision does not of itself void stock control agreements between stockholders, it does not mean that all such agreements are valid. The validity of the contract under the law, after determining the irrelevancy of the constitutional provision, will be subsequently dealt with herein.
Under the statutory law of this state, a corporation is to be managed by a board of directors elected by the stockholders. Section 21-111, R.S.1943. The contract here involved does not violate that provision. The stockholders elect the directors by the terms of the contract, and the power of the directors to manage Harkert Houses is not infringed. "It is not in violation of any rule or principle of law nor contrary to public policy for stockholders who own a majority of the stock of a corporation to cause its affairs to be managed in such way as they may think best calculated to further the ends of the corporation, and it is not against public policy or unlawful per se for stockholders to agree or combine for the election of directors or other officers, so as to secure or retain control of the corporation, at least where the object is to carry out a particular policy with a view to promote the best interests of all of the stockholders, and the agreement is fair to all the stockholders alike, and to the corporation. It is `the general inherent right, resulting from the ownership of stock in a corporation, to exercise the elective power such ownership confers, and to exercise it wisely or unwisely, alone, or pursuant to an agreement with other stockholders.' * * * Accordingly, it has been held that stockholders who own a majority of the stock of a corporation may elect themselves directors or appoint themselves its agents, or form and carry into effect policies of management as freely as if the business were their own, and so long as they act honestly, and do not devote the corporate assets or business to their own private gain or to the prejudice of other stockholders, no one can question their acts, which are purely intra vires. * * * If a control and voting agreement among stockholders aims at security of control without fraud on the corporation or others and does not sever stock ownership from stock control, it is not illegal. * * * In like manner a contract by the owners of more than one-half of the shares of stock of a corporation to elect the directors of the corporation so as to secure the management of its property, to ballot among themselves for directors and officers if they could not agree, to cast their vote as a unit as the majority should decide, so as to control the election, and not to buy or sell stock except for their joint benefit, is not dishonest, violative of the rights of others, or in contravention of public policy, so long as no fraud is committed or wrong done to other stockholders. * * * Hostility towards such agreements and combinations *298 seems to be lessening, or perhaps is becoming more discriminating between good and bad ends. Such agreements are distinct from voting trusts, and are not controlled by the same principles. The stockholders necessarily combine in the majority which passes the vote, whether they do so by previous agreement or not; and doing it by previous agreement is not of itself invalid. According to the weight of authority, the validity and legality of such combinations and agreements depend rather upon the objects thereby sought to be attained and the acts which are done under them, and the other circumstances, and an agreement may be a valid control agreement but invalid because of some other cause or effect. * * * The consideration for a voting agreement may consist in the purchase of stock on the faith of the promise of others to enter into the agreement." 5 Fletcher, Cyclopedia Corporations, § 2064, p. 249. This, we think, states the general law dealing with the subject of stockholders control agreements.
The evidence discloses that prior to the agreement of May 23, 1938, the defendants Harkert were financially involved to the extent that financial assistance was desired, if not necessary. Harkert had sold all of his restaurants for cash and taken back repurchase agreements calling for large monthly payments over a 5-year period. There were other obligations that had to be met. He approached Buck for the purpose of interesting him in providing fresh money for the business. Buck demanded that Harkert's business be incorporated as one condition precedent to financial aid by him. The business was incorporated and the issuance of 4,000 shares of stock at the par value of $100 per share authorized. Buck offered to cancel Harkert's obligations to him and pay $53,625 into the business in consideration of the transfer of 50 percent of the stock to him. Harkert was unwilling to sell 50 percent of the stock on this basis and offered Buck 40 percent of the stock and 50 percent of the control of the business. This arrangement was agreed upon. We point out that the written agreement provided that the board of directors was to be reduced from five to four in number and maintained at that number. This portion of the contract in itself prevented Harkert from electing more than two directors if Buck exercised the right to cumulate his vote. But the agreement went further and provided that each should vote for the two nominees of the other for directors so long as Buck was a stockholder. The evidence is clear that Buck cancelled the indebtedness of Harkert Houses to him and paid the $53,625 in cash on the strength of the control agreement. Without it he would not have agreed to the terms offered. We point out, also, that the agreement in no manner attempted to control the action of directors after they were elected. The claim that the agreement sterilized the board of directors is based on the assumption that the directors nominated by Buck would always vote together. This is probably a practical result, although not one dictated by the agreement. Our statute requires a corporation to have a board of directors of three or more. Section 21-111, R.S.1943. In other words, a board containing an even number of directors is authorized by statute. It would not be unusual for such a board to split evenly on some matters pertaining to corporate policy and thereby create a situation similar to the one before us. Such a situation, in itself, cannot be said to be illegal. The question before us is whether the contract makes it unlawful because of its terms.
It is the contention of the defendants that although a stockholder may vote as he pleases, public policy forbids the enforcement of a contract by which a stockholder undertakes to bargain away his right to vote for directors according to his best judgment, and in the interest of the corporation. They contend that he has no right to disable himself by contract from performing this duty. Defendants cite the following cases in support of this proposition: Haldeman v. Haldeman, 176 Ky. 635, 197 S.W. 376; Jackson v. Hooper, 76 N.J.Eq. 592, 75 A. 568, 27 L.R.A.,N.S., 658; Nickolopoulos v. Sarantis, 102 N.J.Eq. 585, 141 A. 792; Manson v. Curtis, 223 N.Y. 313, 119 N.E. 559, Ann.Cas.1918E 247; *299 Benintendi v. Kenton Hotel, Inc., 294 N.Y. 112, 60 N.E.2d 829, 159 A.L.R. 280; Seitz v. Michel, 148 Minn. 80, 181 N.W. 102, 12 A.L.R. 1060; and Smith v. California Thorn Cordage, Inc., 129 Cal. App. 93, 18 P.2d 393.
The plaintiffs assert that no public policy is violated in the making of an agreement between a majority and a minority stockholder to cause the voting rights in the corporation to be equal when it is beneficial to the corporation for the purpose of bringing fresh money into the business and injures no one except the majority stockholder in voluntarily giving up a part of his voting rights. The following cases are cited in support of this statement: Trefethen v. Amazeen, 93 N.H. 110, 36 A.2d 266; Ringling Bros.-Barnum & Bailey Combined Shows v. Ringling, 29 Del. Ch. 610, 53 A.2d 441; Thompson v. J. D. Thompson Carnation Co., 279 Ill. 54, 116 N.E. 648, Ann.Cas.1917E, 591; Bator v. United Sausage Co., 138 Conn. 18, 81 A.2d 442; Hart v. Bell, 222 Minn. 69, 23 N.W.2d 375, 24 N.W.2d 41; Wabash Ry. Co. v. American Refrigerator Transit Co., 8 Cir., 7 F.2d 335, certiorari denied 270 U.S. 643, 46 S. Ct. 208, 70 L. Ed. 776; and Hocking Valley Ry. Co. v. Toledo Terminal R. R. Co., 99 Ohio St. 35, 122 N.E. 35.
An individual discussion of each case cited by the parties is not practical. There are certain fundamentals pertaining to corporate control running through all the cases cited upon which there can be little or no dispute. Among them are the following: A corporation is a creature of the Legislature, and statutes and applicable law prevail over private agreements between stockholders. The property of a corporation belongs to the stockholders, but the possession and management thereof is in the hands of the directors. An agreement purporting to control the actions of directors after they are elected, in handling the ordinary business of the corporation, is ordinarily void. A partnership may not disguise itself as a corporation and any agreement purporting to do so is, generally speaking, void. The law imposes the business management of the corporation on its directors, who represent all the stockholders and creditors, and they cannot enter into agreements among themselves or with stockholders by which they purport to abdicate their independent judgment. Stockholders are powerless in this state to alter or reduce the voting power of any share of stock. As a general rule, stockholders cannot act in relation to the ordinary business of the corporation, nor control the judgment of directors in the performance of their duties. A board of directors acts through its majority and an agreement providing otherwise violates the intendments of the statutes. The separation of voting rights from stock ownership is frowned upon and will be sustained only when authorized by law, or when it is free from fraud of any kind. Many of the cases cited by the defendants involve one or more violations of the foregoing and do not decide the issue under discussion. It must be conceded, however, that the position of defendants does have support in the authorities cited by them.
But we think the correct rule is that stockholders control agreements are valid where it is for the benefit of the corporation, where it works no fraud upon creditors or other stockholders, and where it violates no statute or recognized public policy. "The propriety of the object validates the means, and must affirmatively appear." Cone v. Russell & Mason, 48 N.J.Eq. 208, 21 A. 847, 850.
It is not here established that the contract worked a fraud upon the corporation, creditors, stockholders, or any other person. Consequently, the following cases sustain the validity of the contract on the point under discussion.
Trefethen v. Amazeen, supra [93 N.H. 110, 36 A.2d 267], is a case in which the agreement between stockholders was for the purpose of securing additional working capital for the corporation and provided that the majority stockholder would waive his right to vote certain shares so long as either of the other two contracting stockholders *300 would own stock in the corporation, so that these two would be able to vote at least 50 percent of the voting stock. The case is very similar on its facts to the case at bar. The court in sustaining the agreement said: "The validity of a contract between stockholders is to be determined by the effects of its provisions. In Bowditch v. Jackson Co., 76 N.H. 351, 82 A. 1014, L.R.A.1917A, 1174, this Court upheld a stockholders' agreement for a voting trust applying as a test the conclusions that there was no wrong to the corporation, no special benefit to the parties to the contract and no turning over of management to strangers. The Court did not leave out of consideration other stockholders individually and creditors. * * * If we apply the above suggested tests to this agreement, it is clear that it is valid. Holden received no special benefit; his only benefit was the general one of all stockholders derived from a corporation with greater working capital. There was no injury to corporation, stockholders or creditors from the addition of new funds. The only detriment was to the parties to the contract and such as they themselves contemplated in the making of it, namely, the paying out of money by two of the parties and the loss of voting rights agreed to by the third party. There was no transfer of control of corporate management, whether for good or ill, to outsiders. The contract merely called for less voting power on the part of an assenting stockholder and relatively greater voting power on the part of other stockholders for a definite period. The effect of this upon other interests no one can say. `It is not in violation of any rule or principle of law nor contrary to public policy for stockholders who own a majority of the stock of a corporation to cause its affairs to be managed in such a way as they may think best calculated to further the ends of the corporation, * * *.' A stockholders' agreement reasonably intended to be beneficial to a corporation and injurious to no one save for the contemplated detriment to the contracting parties is valid. Violation of the present agreement by the defendant trustee would cause irreparable injury to the plaintiff and he is without adequate remedy at law."
In Ringling Bros.-Barnum & Bailey Combined Shows v. Ringling, supra [29 Del. Ch. 610, 53 A.2d 447], the court had before it the question of the validity of an agreement between two stockholders to vote together for a certain slate of directors. For 3 years the two stockholders voted together and elected five of seven directors. The third stockholder by cumulating his vote elected the other two. The two contracting stockholders, Edith Ringling and Aubrey Ringling Haley, each owned 315 shares of stock and the third stockholder, John Ringling North, owned 370 shares. At the 1946 annual stockholders meeting Mrs. Haley voted contrary to the agreement and maintained that the agreement was invalid, or at least revocable. Her contention was based on the proposition that there can be no agreement, or any device whatsoever, by which the voting power of stock of a Delaware corporation may be irrevocably separated from the ownership of the stock except by an agreement which complied with section 18 of the Corporation Law (voting trust statute), and except by a proxy coupled with an interest. It was conceded that the voting trust statute was without application. In holding the agreement valid the court said: "But the statute does not purport to deal with agreements whereby shareholders attempt to bind each other as to how they shall vote their shares. Various forms of such pooling agreements, as they are sometimes called, have been held valid and have been distinguished from voting trusts. * * * We think the particular agreement before us does not violate Section 18 or constitute an attempted evasion of its requirements, and is not illegal for any other reason. Generally speaking, a shareholder may exercise wide liberality of judgment in the matter of voting, and it is not objectionable that his motives may be for personal profit, or determined by whims or caprice, so long as he violates no duty owed his fellow shareholders. * * * The ownership *301 of voting stock imposes no legal duty to vote at all. A group of shareholders may, without impropriety, vote their respective shares so as to obtain advantages of concerted action. They may lawfully contract with each other to vote in the future in such way as they, or a majority of their group, from time to time determine. * * * Reasonable provisions for cases of failure of the group to reach a determination because of an even division in their ranks seem unobjectionable. The provision here for submission to the arbitrator is plainly designed as a deadlock-breaking measure, and the arbitrator's decision cannot be enforced unless at least one of the parties (entitled to cast one-half of their combined votes) is willing that it be enforced. We find the provision reasonable. It does not appear that the agreement enables the parties to take any unlawful advantage of the outside shareholder, or of any other person. It offends no rule of law or public policy of this state of which we are aware."
In Thompson v. J. D. Thompson Carnation Co., supra [279 Ill. 54, 116 N.E. 649], an agreement was entered into between stockholders to vote their stock for each for directors and for no other person. The Illinois court in upholding the agreement said: "It does not divest, or attempt to divest, J. M. Thompson of his control or ownership of his stock, or his right to vote the same, except that by the first clause it is provided that the parties to the same shall vote their stock for each other for directors and for no other person or persons. Contracts of this character, by which the owners of a majority of the stock in a corporation agree to vote for certain persons for directors so as to secure to themselves the control and management of the corporation, are not illegal or void so long as no fraud is committed on the corporation or wrong done to the other stockholders. * * * We held in the case cited that the owners of stock might lawfully contract with each other not to buy or sell stock except for their joint benefit, and that such contracts are not dishonest, violative of the rights of others, or in contravention of the public policy of this state. So far as the evidence shows, no fraud was practiced or intended to be practiced by the contract in question, and in our opinion, in so far as its validity is assailed on these grounds, it must be sustained as a valid exercise of the right of contract."
In Hart v. Bell, supra [222 Minn. 69, 23 N.W.2d 377], the court said: "Romig and C. W. Hart requested Bell to lend additional money to Sports Afield, but he flatly refused unless he were permitted to acquire enough common stock to give him absolute and permanent control. * * * The trial court by its findings, which are all reasonably sustained by the evidence, determined all these issues in favor of defendants, and specifically found that Bell had, in all his corporate activities and transactions, acted in good faith and to the best advantage and interest of Sports Afield and its stockholders. * * * It is not the province of courts to emasculate the liberty of contract by enabling parties to escape their contractual obligations on the pretext of public policy unless the preservation of the public welfare imperatively so demands. * * * `the power of courts to declare a contract void for being in contravention of sound public policy is a very delicate and undefined power, and, like the power to declare a statute unconstitutional, should be exercised only in cases free from doubt.' Cole v. Brown-Hurley Hardware Co., 139 Iowa 487, 491, 117 N.W. 746, 748, 18 L.R.A.,N.S., 1161, 16 Ann.Cas. 846. Quoted with approval in Hollister v. Ulvi, 199 Minn. 269, 280, 271 N.W. 493, 498, 499. * * * The practical conduct of a modern business corporation compels a frank recognition that `an agreement by a number of stockholders to combine their votes in order to effectuate a particular policy is not of itself unlawful in the absence of evidence of an intent to defraud the other stockholders or to secure a private benefit at the expense of the corporation or the other stockholders.' 66 U.S.L.Rev. (1932), pp. 562, 566. Illegality per se is no longer the inevitable consequence of every agreement *302 by a majority of the stockholders without regard to its purpose or effect."
The case of Manson v. Curtis, supra [223 N.Y. 313, 119 N.E. 561], cited by the defendants, is a leading case on the subject before us. In that case the agreement between stockholders was held to be void because it operated to force an abdication by the directors of the control of the business affairs of the corporation. But it does not hold that stock control agreements are void per se as is evidenced by the following from the opinion of the court in that case: "It is not illegal or against public policy for two or more stockholders owning the majority of the shares of stock to unite upon a course of corporate policy or action, or upon the officers whom they will elect. An ordinary agreement, among a minority in number, but a majority in shares, for the purpose of obtaining control of the corporation by the election of particular persons as directors is not illegal. Shareholders have the right to combine their interests and voting powers to secure such control of the corporation and the adoption of and adhesion by it to a specific policy and course of business. Agreements upon a sufficient consideration between them, of such intendment and effect, are valid and binding, if they do not contravene any express charter or statutory provision or contemplate any fraud, oppression, or wrong against other stockholders or other illegal object."
In a similar case the court said in In re Feinson's Estate, 196 Misc. 590, 92 N.Y.S.2d 87, 90: "It is now well established that stockholders of a corporation may validly agree to elect specified persons as directors. Clark v. Dodge, 269 N.Y. 410, 199 N.E. 641; Kassel v. Empire Tinware Co., 178 A.D. 176, 164 N.Y.S. 1033; Matter of Block's Will, 186 Misc. 945, 949, 60 N.Y.S.2d 639, 642. Moreover, the complete owners of a corporation may, by agreement among themselves, control the exercise of power and discretion by the directors of the corporation, provided that the interests of creditors of the corporation are not prejudiced and the public policy of the State is not offended. * * * Even though a contract might impinge somewhat upon the provisions of section 27, General Corporation Law, there is no reason for holding it illegal if the enforcement of it `damages nobodynot even, in any perceptible degree, the public.' Clark v. Dodge, supra, 269 N.Y. page 415, 199 N.E. page 642."
We conclude that stockholders control agreements are not invalid per se. If they are based on a sufficient consideration between the contracting stockholders they are valid and binding if they do not contravene any express constitutional or statutory provision or contemplate any fraud, oppression, or wrong against creditors or other stockholders, or other illegal object. Where such a situation appears it is not illegal or against public policy for two or more stockholders owning the majority of the shares of stock to unite upon a course of corporate policy, or upon the officers, including directors, whom they will elect.
The defendants contend, however, that even if the stock control agreements are generally valid under circumstances here shown, the one at bar is invalid for the reason that the agreement which provides that two of a total of four directors shall be nominated by the owners of 40 percent of the stock and elected by the contracting stockholders so long as the contracting party (Buck) shall be a stockholder, is void as being against public policy. While the cases heretofore cited indicate that such a provision in the agreement does not invalidate the contract under the circumstances, additional cases are cited on this specific point. That there is a division of authority on this point cannot be questioned. We point out once more that the agreement does not place Buck, the owner of 40 percent of the stock, in control of the corporation. It does give him a veto power over questions of corporate policy. It is plain that Buck would not have cancelled the gross indebtedness of $55,650 and paid in the $53,625 in fresh money without the stock control agreement being made. It must be assumed that the purpose of the agreement *303 was to prevent the corporation from getting into financial distress by a continuance of the corporate policy which brought about the necessity for its reorganization at the time Buck became a stockholder. It appears plain that Buck was insistent upon the corporation not spreading itself too thin in the enlargement of its business. The difficulties of Harkert and Buck arose after 11 years of successful operations on the very policy which Buck sought to have maintained when he brought the gross amount of $109,275 into the business by the purchase of 40 percent of the stock. Defendants rely upon Morel v. Hoge, 130 Ga. 625, 61 S.E. 487, 16 L.R.A.,N.S., 1136; Odman v. Oleson, 319 Mass. 24, 64 N.E.2d 439; Luthy v. Ream, 270 Ill. 170, 110 N.E. 373, Ann.Cas.1917B, 368; and cases of similar import to support their position. We think the more reasonable and more modern rule is to the contrary.
Stockholders control agreements which purport to supersede the powers of the directors of a corporation in handling its ordinary business affairs are held ordinarily to be in violation of statutes placing the power of management in the directors. The creation of a dummy board of directors, or, in the language of some of the cases, a sterilized board of directors, by a stockholder control agreement, is usually held to be void. But the mere fact that a board of directors of four members is created with the understanding that each shall nominate two, is not of itself unlawful. The validity of such a contract is determined by the nature of the restrictions placed upon the board in carrying out their duty to exercise their best judgment in managing the affairs of the corporation. Where the control agreement leaves the directors free to act after being selected, we fail to see where there is a violation of any law or established rule of public policy. The mere fact that a board is created which may split evenly on a matter of corporate policy is not a basis for voiding the contract. In the instant case the directors were free to manage the ordinary business affairs of the corporation without contractual restraint. It is not a dummy or sterilized board within the ordinary meaning of those terms. The following from Clark v. Dodge, 269 N.Y. 410, 199 N.E. 641, 643, seems to state the applicable rule: "Except for the broad dicta in the McQuade opinion [McQuade v. Stoneham, 263 N.Y. 323, 189 N.E. 234], we think there can be no doubt that the agreement here in question was legal and that the complaint states a cause of action. There was no attempt to sterilize the board of directors, as in the Manson and McQuade cases. The only restrictions on Dodge were (a) that as a stockholder he should vote for Clark as a directora perfectly legal contract; (b) that as director he should continue Clark as general manager, so long as he proved faithful, efficient, and competentan agreement which could harm nobody; (c) that Clark should always receive as salary or dividends one-fourth of the `net income.' For the purposes of this motion, it is only just to construe that phrase as meaning whatever was left for distribution after the directors had in good faith set aside whatever they deemed wise; (d) that no salaries to other officers should be paid, unreasonable in amount or incommensurate with services rendereda beneficial and not a harmful agreement. If there was any invasion of the powers of the directorate under that agreement, it is so slight as to be negligible; and certainly there is no damage suffered by or threatened to anybody. The broad statements in the McQuade opinion, applicable to the facts there, should be confined to those facts."
Defendants next assert that the control agreement is void because of the provision that Harkert be retained as president for an indefinite period at a fixed salary. On this question the authorities again appear to be in conflict, depending in most cases on the nature of the agreement. But we do not feel that we are called upon to decide it in this case. The defendant Harkert for some 11 years participated in carrying out this part of the agreement by accepting the benefits it gave him. It was a provision for the benefit of Harkert and not of Buck. After reaping the benefits for 11 years he now seeks to invalidate the *304 agreement because of the alleged invalidity of a provision made for his benefit. This he cannot do. It hardly requires a citation of authority to hold that one who has received the benefit of the provision for a period of 11 years may not now question the validity of the provision as a basis for invalidating the control agreement to which he is a voluntary party. He is estopped from questioning its validity. Under such circumstances there is no merit to the defendants' contention on this point.
It is also contended that the control agreement is void because it was to remain in effect so long as Buck retained any stock in the corporation. We think not. The purpose of the agreement was to give Buck such protection against mismanagement as to induce him to bring needed money into the corporation. It is reasonable that such protection should be afforded so long as he is a stockholder. It is not a contract which binds the parties in perpetuity, as defendants allege. It is definite as to the term of its existence. The rule was correctly applied in Trefethen v. Amazeen, supra [93 N.H. 110, 36 A.2d 267], wherein the court said: "Briefly, the present stockholders' agreement was for the purpose of securing additional working capital for the corporation and provided that Mr. Holden would waive his right to vote certain shares so long as either of the other two contracting stockholders should own stock in the company, so that these two would be able to vote at least 50% of the voting stock. * * * The contract merely called for less voting power on the part of an assenting stockholder and relatively greater voting power on the part of other stockholders for a definite period."
It is urged that the sale and repurchase agreements made by Harkert and Buck prior to 1938 were usurious. We do not deem it necessary to determine that question because of the nature of the consideration recited in the stockholders control agreement. The agreement in part provided: "That, whereas, said party of the second part has this day purchased from Harkert Houses, a corporation of Douglas County, Nebraska, and Walter E. Harkert, President of said corporation, 1200 shares of stock of said Harkert Houses of the par value of $120,000 as evidenced by Certificate No. 39 for 1198 shares issued to the party of the second part and one share issued to Earl K. Buck, President of party of the second part, and one share issued to Rodney B. Devor, Treasurer of party of the second part, and has paid therefor the sum of $53,625 in cash and has canceled and satisfied notes of said Harkert Houses, maker, and of said Walter E. Harkert, maker, which have heretofore been assumed by the said Harkert Houses, in the total gross face sum of $55,650; * * *." No attempt was made to calculate the net amount due Buck from Harkert Houses in the contract, nor to fix the actual value of the stock sold to Buck. The stated consideration was that Buck would pay $53,625 in cash and cancel the indebtedness of Harkert Houses to him in the "total gross face sum of $55,650." Whatsoever the net amount of the total gross face sum of $55,650 may have been, played no part in the transaction. As a matter of law, the consideration fixed by the agreement is controlling and the net amount due is immaterial to the issue. Defendants are in no position to assert that the "deals" made prior to the incorporation of Harkert Houses were usurious.
We conclude that the stockholders control agreements were valid under the circumstances here shown and that the declaratory judgment entered on October 29, 1951, was correct in so holding.
In its decree of October 29, 1951, the trial court, after holding that there was a breach of a valid contract on the part of the defendants, authorized the plaintiffs to institute ancillary proceedings to recover such damages, if any, resulting from the breach of contract. Jurisdiction to entertain such further application and to render complete relief in damages was therein specifically retained.
Plaintiffs thereafter filed a supplemental petition setting forth the damages they are alleged to have sustained. The nature of *305 such damages are summarized in plaintiffs' brief and for the purposes of the question to be considered, they will be accepted. It is claimed that the following items would not have been expended if the stockholders control agreement had not been breached by Harkert and his associates and, plaintiffs being the owners of 40 percent of the stock of the corporation are entitled to a personal judgment for 40 percent of the losses sustained. The items of damage, briefly stated, are: Attorney fees paid by the corporation in this litigation, $4,000; accountant fees paid by the corporation in this suit, $930.25; excessive expenditures at the Athletic Club location, $18,085.32; excessive salary paid to Fitzgerald, Schwentker, and Clara Harkert, $5,264.52; proceeds of corporate bonds used in purchase of Farnam Street building, $25,000; proceeds of corporate bonds used in establishment of the restaurant in Lincoln, $37,000; expenditure of corporate earnings in paying off the mortgage on the Farnam Street building, $25,000; expenditure of corporate funds on Lincoln restaurant over and above that derived from the sale of bonds, $15,639.60; and rent paid on location leased and not used by the corporation, from June to December 1951, $2,100. The total of these items is $133,019.69, 40 percent of which is $53,207.87 for which plaintiffs sought judgment. In addition to the foregoing, defendants are charged with waste and mismanagement of the corporate business, thereby causing the net profit for the first 6 months in 1951 to be only $25,009 as against $41,766.04 and $47,519.73 for the same periods in 1950 and 1949, respectively. The defendant Walter E. Harkert is charged with using funds of the corporation in the amount of $2,185 for the purchase of an automobile for his own use and in making loans of corporate funds to his friends and relatives in the amount of $2,890 which have been outstanding and unpaid for 2 years. Plaintiffs allege that they have been damaged by the breach of the stockholders control agreement on the part of the defendants in an amount not less that $100,000. A trial was had on the issues thus presented which resulted in the decree of January 14, 1953, awarding plaintiffs a judgment against the defendants Harkert in the amount of $33,612.
The defendants assert that plaintiffs had no personal cause of action against the defendants Harkert and that the damages alleged, if proved, run in favor of the corporation. In other words, the contention of the defendants is that any action to recover the damages alleged must be brought in the name of the corporation, either by the corporation itself or, upon its refusal or failure to do so, by a stockholder in a representative action. The plaintiffs contend that the action is personal to them because of the stockholders control agreement which was entered into between E. K. Buck Retail Stores and the defendants Harkert, personally, as stockholders.
The general rule is stated in Ruplinger v. Ruplinger, 154 Neb. 394, 48 N.W.2d 73, 75, as follows: "A stockholder may not bring an action in his own name to recover for wrongs done to the corporation or its property. Such a cause of action is in the corporation and not the stockholders. The right of a stockholder to sue is derivative in its nature and can be brought only in a representative capacity for the corporation."
We point out that every item of damage claimed, if the defendants are liable therefor, is a wrong committed against the corporation or its property. The damages alleged either deplete corporate funds, convert property of the corporation into unauthorized investments, or tend, because of inept management, to reduce the value of the stock of all stockholders. Such damages ordinarily fall within the general rule and create a cause of action on the part of the corporation or a representative suit by a stockholder. It is the contention of the plaintiffs that the stockholders control agreement calls for a different result in the present cause that raises the precise question to be decided.
In Smith v. Bramwell, 146 Or. 611, 31 P.2d 647, 648, the court after recognizing the general rule stated: "Appellant recognizes the rule as above stated, but asserts *306 that it has no application to the particular facts involved in this case. Plaintiff contends that his action is based upon a violation of the voting trust agreement and that, by virtue of such contractual relationship, he may maintain the action in his own behalf even though there was a direct damage to the corporation. * * * We cannot agree that the instant action is predicated upon a breach of the voting trust agreement. Some of the defendants were not parties to this trust agreement. When confronted at the commencement of the trial by the objection to the introduction of any testimony for the reason that the complaint failed to allege a cause of action, the plaintiff undertook to bring himself within the exception to the general rule, relative to actions by stockholders against officers of a corporation, by showing a contractual relationship under the voting trust agreement. But, as we have endeavored to show, a breach of this voting agreement did not confer upon the plaintiff a right to an individual and direct action, as distinguished from a derivative one, as any loss sustained by plaintiff by reason of the breach was, under the facts alleged, common to all stockholders."
In Green v. Victor Talking Machine Co., 2 Cir., 24 F.2d 378, 382, 59 A.L.R. 1091, the court said: "Nor does the allegation of a contractual duty to plaintiff's testator aid her. If it be assumed that the allegations of the complaint are sufficient to charge a contractual duty owing by defendant to the Pearsall Company, despite the indefiniteness of the terms of such a contract, and despite the fact that it was made with a shareholder, not with the corporation, nevertheless a breach of that duty would give a right of action to the corporation, not to its shareholders."
To like effect is Wells v. Dane, 101 Me. 67, 63 A. 324, 325, which states: "The plaintiff was not the corporation, notwithstanding he owned and controlled a majority of its stock. He did not own or control its property or make or cancel its contracts with the defendant Dane. * * * He was injured the same as every other shareholder because of and through the injury to the corporation property and rights. There was no special injury to the plaintiff different from that to all other shareholders, nor were his individual rights injured outside of the injury suffered by the collective entity, the corporation. `A shareholder cannot sue individually for damages caused by wrongful acts impairing the value of his shares through an invasion of the corporate or collective rights.' Morawetz, Pri.Corp. § 236a. In such cases, if the regular officers of the corporation are unable or unwilling to take the necessary steps to protect the corporate property and interests, a shareholder may proceed in equity on behalf of himself and other stockholders and the company. At law, however, the corporation itself representing all those rights can alone recover for such injury. Any other rule would admit of as many suits against the wrongdoer as there were stockholders in the corporation. * * * There may be cases of injuries to the individual rights of the shareholder where he, and not the corporation, must seek redress; such, for instance, as the levying of an unlawful tax on shares held by the individual stockholder, mutilation or destruction of his certificate, or circulating false and scandalous reports, or issuing spurious certificates thus creating uncertainty as to the title or validity of existing shares. In all such cases, however, the wrongful act affects the shares directly. They are readily distinguished from the case at bar where the plaintiff claims his shares were depreciated by wrongful acts making possible the issue of 600 shares of stock without payment therefor. Such a wrong being primarily against the corporation, the redress for it must be sought by the corporation."
Other cases to the same effect are: Commonwealth of Massachusetts v. Davis, 140 Tex. 398, 168 S.W.2d 216; Coronado Development Corp. v. Millikin, 175 Misc. 1, 22 N.Y.S.2d 670; and Liken v. Shaffer, D.C., 64 F. Supp. 432.
The plaintiffs rely upon the case of Ritchie v. McMullen, 6 Cir., 79 F. 522, 533, wherein the court said: "But we are of *307 opinion that this principle has no application where the wrongful acts are not only wrongs against the corporation, but are also violations by the wrongdoer of a duty arising from contract or otherwise, and owing directly by him to the stockholders." Other cases cited are: In re Auditore's Will, 249 N.Y. 335, 164 N.E. 242, 62 A.L.R. 551; R. G. Dun & Co. v. Shipp, 127 Tex. 80, 91 S.W.2d 330; Meyerson v. Franklin Knitting Mills, 185 A.D. 458, 172 N.Y.S. 773; and Keating v. Hammerstein, 125 Misc. 334, 209 N.Y.S. 769.
It is true that the line drawn by the cases determining when a stockholder may or may not sue in person is not too well defined. At least the reasoning contained in them does not uniformly point to the same result. The better rule seems to be that a stockholder may sue personally, as distinguished by suit in a representative capacity, when he has sustained a loss separate and distinct from that of other stockholders. The entry of the parties into the stockholders control agreement did not operate to confer upon plaintiffs the right to an individual direct action that did not exist before. We point out that the control agreement is upheld on the theory that it was for the benefit of the corporation and all stockholders alike. If it had operated to bestow special privileges upon one or both of the stockholders at the expense of stockholders not a party to the agreement, the validity of the agreement would appear doubtful. Plaintiffs assert no cause of action peculiarly their own as distinguished from other stockholders. The control agreement purports only to establish a business policy for the corporation, the continuance of which is assured by the contractual right of Buck to nominate two of the directors. The plaintiffs, therefore, find themselves in a situation where they must choose between two courses of action,sustain the control agreement and seek their remedy for damages by a representative suit or, on the other hand, assert special rights appurtenant to their shares of stock and have no cause of action at all for damages resulting to all stockholders. Plaintiffs clearly chose the wrong remedy under the facts presented.
To hold that plaintiffs could sue personally in the present case would authorize a suit by each stockholder and result in a multiplicity of suits. The damages alleged are to the corporation which is owned by all the stockholders. It follows that a right of a stockholder to sue under the facts pleaded is derivative only. The recovery, if any, would be in favor of the corporation and, indirectly to all stockholders. The supplemental petition sets forth the damages alleged to be due to the breach of the control agreement by the defendants. Plaintiffs pray that 40 percent thereof, based on their ownership of 40 percent of the stock of the corporation, indicating that plaintiffs recognize that the damages resulted to all stockholders, shall be awarded to them personally. In other words, for a direct injury to the stock of a stockholder, not common to all stockholders as such, plaintiffs may pursue a personal action. The plaintiffs do not come within this rule in the case at bar. When the injury is to the collective rights of stockholders and the corporate property has been augmented by restitution, the plaintiffs, who have suffered as one of these, will be fully indemnified. If a stockholder is permitted to bring an action personally to recover his proportionate share of the damages suffered by the corporation, a subsequent recovery by or for the corporation would be equivalent to a double recovery by him. To permit such an action by the stockholder individually could possibly injure the rights of creditors and taxing authorities. The reasoning of the cases that a stockholder cannot sue personally for damages where only his derivative or corporate rights have been infringed, appears unassailable. We hold, for the reasons stated, that plaintiffs have neither alleged nor proved any right to damages for which they could sue personally in their capacity as stockholders. The judgment in the amount of $33,612, bearing date of January 14, 1953, is therefore reversed and the *308 pleading designated as an ancillary and supplemental petition is dismissed.
For the reasons herein stated, the decree of October 29, 1951, is affirmed, and the decree of January 14, 1953, is reversed and the pleading designated an ancillary and supplemental petition is dismissed.
Affirmed in Part, and in Part Reversed and Dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545842/ | 77 F.2d 45 (1935)
FIRST SEATTLE DEXTER HORTON NAT. BANK et al.
v.
COMMISSIONER OF INTERNAL REVENUE.
No. 7326.
Circuit Court of Appeals, Ninth Circuit.
April 22, 1935.
*46 James H. Kane, of Seattle, Wash., for petitioner.
Frank J. Wideman, Asst. Atty. Gen., and Sewall Key and S. Dee Hanson, Sp. Assts. to the Atty. Gen., for respondent.
Before WILBUR and GARRECHT, Circuit Judges, and NORCROSS, District Judge.
NORCROSS, District Judge.
This petition for review involves an alleged deficiency in income tax against petitioners in the amount of $5,779.69 for the calendar year of 1926. There is no conflict in the testimony or other evidence in the case. Most of the facts are covered by stipulation. The material facts are as follows:
Some time prior to February 15, 1926, George Boole died testate, and the petitioners were appointed and now are the executors of his estate. Prior to the death of the testator there were two corporations each having the name A. M. Castle & Co. One was located in Chicago, and is hereinafter called the Chicago corporation; the other was located in Seattle, and is hereinafter called the Seattle corporation. At the time of his death, testator owned 2,913 shares of the preferred stock of the Seattle corporation.
As a part of the reorganization of the Chicago corporation, a written agreement was entered into on February 15, 1926, between petitioners, as executors and trustees under the will of George Boole, deceased, parties of the first part, and the said Chicago corporation, as party of the second part, under the terms of which the Seattle corporation merged and consolidated itself and its assets with the Chicago corporation. Pursuant to said agreement, petitioners sold and delivered to the Chicago corporation the stock hereinbefore referred to in the Seattle corporation, belonging to the estate of George Boole, deceased, and received in exchange therefor certain shares of stock and cash of the Chicago corporation.
The paragraphs of the agreement pertinent to the sale in question are as follows:
(1) "The parties of the first part (the executors) agree to convey, sell and assign to the party of the second part (A. M. Castle & Co. of Chicago) and the party of the second part agrees to buy, 2,913 shares of the preferred stock of A. M. Castle and Company of Washington, for $90.00 per share, subject, however, to all the other terms of this agreement."
(2) "Immediately upon the consummation of the sale provided for in paragraph one hereof, the parties of the first part agree to accept in payment of said 2,913 shares of the preferred stock of A. M. Castle and Company of Washington at $90.00 per share, 2,621 shares of preferred stock in the party of the second part of the par value of $100.00 per share, * * * and the sum of $70.00 in cash."
*47 (5) "As one of the conditions precedent to the sale and exchange of stock provided for hereunder, the party of the second part shall cause David B. Gann of Chicago, Illinois, attorney for the party of the second part, or someone in his behalf, to purchase from the parties of the first part for cash at par, together with accrued dividends thereon, $50,000.00 of the par value of the preferred stock in A. M. Castle and Company of Chicago sold to the said parties of the first part under Paragraph 2 hereof, said purchase to be simultaneous with the sale and exchange provided hereunder."
This agreement was carried out, the stock delivered, and the cash paid.
The only controversy in this proceeding is whether or not a taxable gain resulted from the above-described transaction. The Commissioner found that there was a net taxable gain of $50,070, composed of $50,000 received from the sale of 500 shares of the preferred stock of A. M. Castle & Co. of Chicago for $50,000, and $70 cash received upon the exchange of said stocks, whereas petitioners deny that there was any taxable gain. The determination of the Commissioner of Internal Revenue was sustained by the Board of Tax Appeals in a decision entered April 27, 1933, which decision petitioners now bring before this court for review.
The Commissioner of Internal Revenue determined a profit on the transaction here in question only to the extent of and measured by the total amount of cash actually received by petitioners; namely, $50,070. He used as a basis therefor the value of the stock of the Seattle corporation as appraised for federal estate tax purposes, and the par value of the stock of the Chicago corporation ($100), and asserted a deficiency accordingly.
In their assignments of error petitioners contend: First, that the contract of February 15, 1926, was divisible to the extent that the exchange of the preferred stock of the Seattle corporation for the preferred stock of the Chicago corporation was a distinct and separable transaction from the sale of the 500 shares of stock of the Chicago corporation for $50,000 referred to in paragraph 5 of the agreement hereinbefore set forth, and that the Board erred in not so finding; second, error is predicated on the act of the Board in affirming the Commissioner's determination that the preferred stock of the Chicago corporation had a fair market value at the time of the sale of at least $100 per share, it being the contention of petitioners that such stock at the time in question was without any "fair market value," and therefore no gain or loss was realized.
As to their first assignment of error petitioners maintain that under section 203 (b) (2) of the Revenue Act of 1926, 44 Stat. 9, 26 USCA § 934 (b) (2), no gain should be recognized in such an exchange of stock for stock pursuant to a plan of reorganization. Such conclusion is made dependent upon the premise that the said sale of the 500 shares of stock of the Chicago corporation was a separable transaction from the exchange of the preferred stocks of the two corporations, and that in this respect the terms of the contract were divisible. That portion of the act above referred to, and upon which petitioners rely as being controlling in the circumstances, is as follows: "(b) (2) No gain or loss shall be recognized if stock or securities in a corporation a party to a reorganization are, in pursuance of the plan of reorganization, exchanged solely for stock or securities in such corporation or in another corporation a party to the reorganization."
On behalf of the government it is claimed that the transaction is governed by section 203 (d) (1) of the same act (26 US CA § 934 (d) (1), which reads: "(d) (1) If an exchange would be within the provisions of paragraph (1), (2), or (4) of subdivision (b) if it were not for the fact that the property received in exchange consists not only of property permitted by such paragraph to be received without the recognition of gain, but also of other property or money, then the gain, if any, to the recipient shall be recognized, but in an amount not in excess of the sum of such money and the fair market value of such other property."
It appears, therefore, that if, as contended by the Commissioner, the contract here in question is not susceptible of division so as to come within section 203 (b) (2) and amounts merely to an exchange of stock for stock, it must necessarily fall within the provisions of section 203 (d) (1), in which case the Commissioner's determination of tax deficiency must be sustained, unless he erred in his finding relative to the market value of the said stock.
In passing upon the question of whether or not the contract is severable or entire, it is fundamental that the intention of the parties should be looked to, and that the contract should be construed so as to *48 effectuate such intention so far as the bounds of reason and justice permit. Obviously, courts cannot possibly know or judge what the parties may have intended to accomplish but failed to expressly provide for, and therefore such intention must be ascertained by a fair construction of the terms of the contract itself. So where parties enter into a written agreement which embodies and sets forth in full all the terms and conditions of the contract, their intentions must necessarily be determined from and governed by the language they have employed in such writing, and from the subject matter of the agreement. To do otherwise would be to frustrate the very end for which people contract in writing.
Thus upon an examination of the contract here in question we find that under the specific and unambiguous terms thereof, as set forth in paragraph 5, it is provided that, "as one of the conditions precedent to the sale and exchange of stock provided for hereunder," the purchase of the said 500 shares for $50,000 was "to be simultaneous with the sale and exchange provided hereunder." Such language would seem to clearly evince that it was the intention of petitioners that, unless they received the said $50,000 in cash in addition to 2,121 shares of the Chicago corporation's stock, they would not go through with and consummate the deal. Moreover, that the obtaining of the $50,000 in cash was the motivating cause and primary purpose of petitioner's entrance into the entire transaction is evidenced by the testimony of petitioner's attorney, James H. Kane. This witness, called by petitioners, testified in part, as follows: "* * * We insisted upon the provision which is in the contract, that after we got the stock of A. M. Castle & Company of Chicago they would furnish a buyer for it, or buy it themselves, at least 500 shares of the stock at par, in order to give us some assurance that we could settle up the estate and get money that we then needed. The estate needed money as there were many obligations to take care of. * * *"
It appears from the stipulation of facts heretofore referred to that the Chicago corporation accordingly agreed to and did purchase the said 500 shares of their stock for the agreed price. All of the provisions to that end were carried out at the same time. The net result at the conclusion of the transaction was that the petitioners held 2,121 shares of the Chicago corporation's stock plus $50,070 in cash, while the Chicago corporation obtained in return therefor 2,913 shares of the stock in the Seattle corporation. It is also to be noted that it is conceded by petitioners in their brief that the sale of the 500 shares of stock was concluded as a part of the same transaction.
The general rule of interpretation to be applied in deciding whether or not a given contract is severable or entire is well stated in 13 C. J. 561, § 525, as follows: "As a general rule it may be said that a contract is entire when by its terms, nature and purpose it contemplates and intends that each and all of its parts and the consideration shall be common to the other and interdependent."
To the same effect, holding that primarily the question whether a contract is entire or severable is one of intention, see Los Angeles Gas, etc., Co. v. Amalgamated Oil Co., 156 Cal. 776, 106 P. 55. See also Commissioner v. R. J. Darnell, Inc. (C. C. A.) 60 F.(2d) 82; In re Hellams (D. C.) 223 F. 460.
Therefore, taking into consideration the circumstances and evidence as they appear from the record, in the light of the above authorities, we cannot but conclude that the sale and exchange here in question constituted, in effect, one composite transaction designed to effect a single purpose.
With reference to petitioner's first assignment of error, the government further contends that, regardless of whether or not the contract in question is divisible, as argued by petitioners, the section of the Revenue Act of 1926 upon which they rely (section 203 (b) (2), supra, has no application to the situation in the case at bar. In this connection the following statement appears in the opinion of the Board of Tax Appeals: "* * * This contention (petitioner's), however, overlooks the fact that this section of the law (section 203 (b) (2) provides that no gain shall be recognized `if the stock or securities * * * are * * * exchanged solely for stock or securities', and that in this case in addition to stock the Chicago corporation also paid to petitioners cash of $70 at the least, which is sufficient to take the transaction out of the statute relied on. In any event, therefore, it appears that the transaction is governed by section 203 (d) (1) of said act. * * *"
While the government in its brief has not referred us to any judicial interpretations of this section of the act in accord with their contention, nor does it appear *49 that there are any such cases directly in point, we believe that the clarity of the language employed in said section limits its application to cases involving reorganization of corporations wherein the stock of one is exchanged solely for the stock of another. Since admittedly petitioners exchanged the stock of the Seattle corporation for that of the Chicago corporation and $70 in cash, the decision of the Board of Tax Appeals in this respect must be sustained. However, having already construed the contract in question as being entire rather than divisible, and thereby bringing it within the provisions of section 203 (d) (1), this point is not necessarily determinative of the issues herein presented, and need not be pursued in view of our disposition to treat the transaction as an entire one.
Moreover, in view of the principle that, in applying income tax laws, the substance, and not the form, of the transaction should control, the exchange and sale of stock which was required under the whole contract herein should be treated as a single, composite transaction for income tax purposes, regardless of the formalities followed. See S. A. MacQueen Co. v. Com'r, 67 F.(2d) 857, 858 (C. C. A. 3); Tulsa Tribune Co. v. Com'r, 58 F.(2d) 937, 940 (C. C. A. 10); Western Maryland Ry. Co. v. Com'r, 33 F.(2d) 695 (C. C. A. 4); United States v. Phellis, 257 U.S. 156, 158, 42 S. Ct. 63, 66 L. Ed. 180; Weiss v. Stearn, 265 U.S. 242, 254, 44 S. Ct. 490, 68 L. Ed. 1001, 33 A. L. R. 520. In dealing with a situation not unlike the one at bar, the court, in the case of West Texas Refining Co. v. Com'r, 68 F.(2d) 77, 80 (C. C. A. 10), quoting from Prairie Oil & Gas Co. v. Motter, 66 F.(2d) 309, 311 (C. C. A. 10), said: "If a taxpayer sought to avoid a tax on the profits of such a sale as this by asking the Commissioner to ignore the actualities, he would shortly and properly be reminded that taxation is an intensely practical matter and that the substance of the thing done, and not the form it took, must govern."
As we have already stated, as we see it what petitioners actually did was, in effect, to exchange 2,913 shares of stock in the Seattle corporation for 2,121 shares, net, of the Chicago corporation, and $50,070 in cash. Regardless of the interpretation or construction which petitioners seek to place upon their contract, in cases such as this matters of form should be disregarded for those of substance.
Having determined that section 203 (d) (1) of the Revenue Act of 1926 is controlling in the situation at bar, it now becomes necessary to examine its provisions in order to ascertain to what extent the property herein involved is taxable. The section provides that, in an exchange of property for other property or money, the gain, if any, to the recipient shall be recognized in an amount not exceeding the sum of such money and the fair market value of such other property. We shall proceed, therefore, to determine whether or not the Commissioner and the Board correctly valuated the property entering into the transaction. As heretofore stated, the determination of the Commissioner which was sustained by the Board was that the fair market value of the Chicago corporation's preferred stock was not less than $100 per share at the time of the sale in question. By their second assignment of error petitioners attack such finding as being erroneous; their contention being that said stock was wholly without any fair market value, and consequently no gain or loss could be realized from the transaction.
The record discloses that under the terms of the contract of February 15, 1926, it was provided in the form of a condition precedent that the Chicago corporation was to call in, redeem, or purchase all of the stock of a certain $250,000 issue which was at the time outstanding. After providing for the retirement of this old stock, the contract further provided for the issuance by the said Chicago corporation of a new preferred stock, such issue not to exceed $1,000,000, and to be the only preferred stock outstanding. The parties also agreed that, when this new stock was issued, it was to be sold for cash only and for not less than par ($100); that the said stock "shall be cumulative and the dividend rate shall be seven per cent per annum payable semiannually, and that the said stock shall be preferred as to dividends and assets in case of dissolution." The stock which petitioners received from the Chicago corporation in exchange for their stock in the Seattle corporation, as well as the 500 shares in question which the Chicago corporation bought back, was stock of this so-called new issue.
The Chicago corporation guaranteed that the dividends should be promptly paid in cash, when due, and in addition agreed "to redeem or purchase at par and accrued dividends" all preferred stock distributable *50 to Helen King Boole, petitioner and legatee under the will of her deceased husband, George Boole, "on or before three (3) years after the execution of this agreement"; it being provided, however, that said stock was not to exceed an amount in excess of five-sixteenths of the remaining stock held by the executors, petitioners herein. There being 2,121 shares of said stock remaining after the sale of the 500 shares for $50,000, the said five-sixteenths which might be allotted to the widow under the terms of the said contract would amount of approximately 662 shares, and these the Chicago corporation agreed to purchase at par ($100). Adding to this figure the 500 shares agreed to be bought back under the terms of paragraph 5 of the said agreement, there were 1,162 shares contracted for before the stock was issued.
It further appears from the record that during the course of the hearing the attorney for the petitioners stated that about $680,000 of this million dollar stock issue was issued after the reorganization. Petitioners introduced no evidence to show at what price this stock was sold. In the absence of any such evidence, as to the matter of the "fair market value" of this stock, the Board was warranted in assuming, as it did, that said stock was sold at par in pursuance of the terms of the agreement heretofore referred to.
Thus, having 1,162 shares contracted for before the reorganization and about 6,800 shares which were sold thereafter, it appears that over three-fourths of the whole authorized issue of $1,000,000 were sold at a price as great as par ($100).
The question of the value of the preferred stock here in controversy is one of fact, and the Board's decision affirming the Commissioner's determination, when supported by any substantial evidence, in the absence of a showing of clear and unmistakable error, is conclusive upon appeal. "* * * This is but another way of saying that the decision of the taxing board must prevail if it is not contrary to the `indisputable character of the evidence' or if the evidence is `legally sufficient to sustain' such finding. The evidence is legally sufficient to sustain the finding if there be substantial evidence to support it, and the record as a whole does not clearly, convincingly, or even possibly, `indisputably' require a contrary conclusion. * * *" Tracy v. Commissioner, 53 F.(2d) 575, 579 (C. C. A. 6), and cases cited; Phillips v. Commissioner, 283 U.S. 589, 51 S. Ct. 608, 75 L. Ed. 1289; Crowell v. Commissioner, 62 F.(2d) 51 (C. C. A. 6); Williams v. Commissioner, 45 F.(2d) 61 (C. C. A. 5); Old Mission P. Cement Co. v. Commissioner, 69 F.(2d) 676 (C. C. A. 9); Emerald Oil Co. v. Commissioner, 72 F.(2d) 681 (C. C. A. 10).
After reviewing the record in this case, we conclude that there was ample substantial evidence to warrant the Board in affirming the finding of the Commissioner that the fair market value of the stock in question was at least $100 per share.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2341963/ | 113 N.J. Super. 19 (1971)
272 A.2d 549
NOPCO CHEMICAL COMPANY, A CORPORATION OF NEW JERSEY, PLAINTIFF-APPELLANT,
v.
BLAW-KNOX COMPANY, A CORPORATION OF NEW YORK, ET ALS., DEFENDANTS-RESPONDENTS.
Superior Court of New Jersey, Appellate Division.
Argued October 5, 1970.
Decided January 8, 1971.
*20 Before Judges CONFORD, KOLOVSKY and CARTON.
Mr. Albert E. Fershing argued the cause for appellant (Messrs. Shurkin, Hersh & Fershing, attorneys).
Mr. Augustus Nasmith argued the cause for respondent Blaw-Knox Company (Messrs. Carpenter, Bennett & Morrissey, attorneys).
Mr. John Methfessel argued the cause for respondent Central New York Freightways (Mr. Samuel A. Gennet, attorney).
*21 Mr. Neil Reiseman argued the cause for respondent Harrison Warehouse Corporation (Messrs. Schreiber and Lancaster, attorneys).
Mr. Richard M. Icklan argued the cause for respondent Belby Transfer Company (Messrs. Lamb, Blake, Hutchinson & Dunne, attorneys).
Mr. Marvin A. Sacks argued the cause for respondent John S. Geiger & Sons, Inc. (Messrs. Feuerstein, Sachs & Maitlin, attorneys).
PER CURIAM.
We are constrained to agree with the judgment of dismissal as to all defendants in this case, notwithstanding the probability that the damage to the equipment occurred while it was being loaded or unloaded by crane and cable by one or more of defendants, Blaw-Knox, Harrison Warehouse, Geiger or Belby.[1]
The only substantial proof as to how the damage occurred was that it was by steel cables rubbing against the equipment in the course of hoisting it without protective spreaders between the object and the cables. Cables were used by Blaw-Knox in loading onto Central Freightways' truck; by Harrison Warehouse in unloading from that truck and later in loading onto Belby's truck, and finally by Belby (which may have been aided by Geiger) in hoisting the object to the third floor of plaintiff's plant, and possibly in moving it into final position for use at that plant.
Taken as a whole, the proofs do not establish a basis for reasonably finding, as a matter of probability, that the *22 damage was caused by any particular one of the four handlers mentioned. It could have been by any.[2] See Hansen v. Eagle-Picher Lead Co., 8 N.J. 133, 141 (1951). Hannett, plaintiff's representative at the time of the occurrence (but not employed by it at the time of trial), testified he saw a smudge and a slight tear in the protective wrapping paper around the drums (the item damaged) while the equipment was at Harrison Warehouse. He complained to no one. Contradictorily, however, he said he saw no tear on the paper after delivery to plaintiff's premises by Belby. However, he did see cable marks on the trunnion (axle) portion of the drums, a portion not protectively wrapped, while the equipment was on Belby's truck before being lifted into the plant. But giving Hannett's testimony the most favorable reading from plaintiff's point of view, it would justify at most only an inference that either Blaw-Knox or Harrison Warehouse had done the damage, not that it was more probably one than the other.
There is no prima facie case against Central Freightways by virtue of its status as an interstate common carrier or by reason of its having given a "clear receipt" to Blaw-Knox. It is true that a common carrier is liable for any damage to goods while in its custody. But the rub here is absence of proof that the damage (abrasion of the drums by cable) occurred during the carrier's custody. Admittedly, Blaw-Knox put the equipment aboard the truck and Harrison Warehouse took it off, both firms using a crane and cable. The "clear receipt" given Blaw-Knox constitutes prima facie proof merely that there was no apparent damage to the goods when taken aboard by Central Freightways. Silver Lining, Inc. v. Shein, 37 N.J. Super. 206, 214 (App. Div. 1955); Lincoln Farm Products Corp. v. Central R.R. of N.J., 81 N.J. Super. 161, 168-169 (App. Div. 1963). It does not admit there was no concealed unobservable damage to the equipment. Even plaintiff's representatives, Hannett *23 and Batchelar, both of whom saw the equipment before it was unwrapped at terminus, saw no damage to the drums at that time. Thus the giving of the receipt by Central Freightways, in the light of all the other proof would not furnish a basis to permit a jury to conclude that the goods were in worse condition when the carrier delivered them than when they were delivered to it a necessary prerequisite to liability. Silver Lining, Inc. v. Shein, supra, 37 N.J. Super. at 214.
Plaintiff's claim against Blaw-Knox for breach of warranty had to be dismissed because, on its own case, any defect in the article as manufactured was negatived by its own proofs that the defect was the result of abrasion by cable while in transit. Blaw-Knox could therefore be held, if at all, only for damaging the goods in placing them aboard the carrier at Buffalo a thesis not established against it by plaintiff's proofs on the basis of probability as distinguished from mere speculative possibility. Hansen v. Eagle-Picher Lead Co., supra.
We are not insensitive to the plight of the unsuccessful plaintiff manifested by the dissenting opinion herein. However, it will be noted that discovery efforts by plaintiff were confined to interrogatories. No depositions were taken by it. Second, the mere denial of the motion to dismiss would not improve plaintiff's proof position if defendants rested without offering proofs their undoubted right. Finally, the interests of justice are not served if, in the effort to make plaintiff whole, a jury is permitted at random to select any one out of three or four defendants for liability where the greater mathematical probability is that the negligence is that of another of them, if of any at all.
The commercial policy considerations advanced by the dissent might well call for a legislative solution through arbitrary placement of responsibility in a proof situation of this kind (compare the Carmack amendment, cited in the dissent). In the absence thereof, we see no justification for judicial remission here of the ordinary procedural principle *24 that a suitor must prove his case against a defendant by the preponderance of the probabilities.
Judgment affirmed; no costs.
CARTON, J.A.D. (dissenting).
The majority concede the probability that one or more of the defendants handling the dryer during the course of its journey from the manufactory to the purchaser's plant were responsible for its damaged condition. Yet they conclude that the law required the dismissal of the action at the end of plaintiff's case along with the dismissal of all cross-claims without imposing upon any defendant the obligation of coming forward with evidence as to what it did while the machine was in its possession and control.
The law does not compel such a "lame and impotent conclusion." Reason and ordinary common sence dictate that in such a commonplace, mercantile situation (involving as it does the handling and transportation by successive but unconnected carriers and other bailees for hire) existing procedures be adapted or a new remedy be devised which will cause those parties most likely to possess knowledge of the occurrence to come forward with the facts peculiarly within their possession. To me it seems indefensible that the court should stand idly by and lend itself to such an obvious thwarting of justice.
Such judicial reticence cannot be rationalized on any hypothesis that it is improbable any one defendant can be shown to be liable. This assumption discounts the possibility and perhaps likelihood that the defendants' proofs may well single out the one responsible from the group of those probably liable. Granting of judgment, at least at this juncture, is premature on any thesis.
The broader concept implicit in the majority's view that defendants have no responsibility to offer proof, and that the courts have no power to compel a full exposure of the facts, suggests a reverence to procedure which contravenes *25 the modern insistence that causes be determined on their merits.
There is no lack of feasible machinery to bring about a full disclosure of the facts and an ultimate determination on the merits in this case. A fuller review of the evidence than is related by the majority opinion will exemplify the inequity perpetrated simply because there exists no clear-cut precedent.
The dryer is a piece of machinery used to convert liquid chemicals into dry powders. It was purchased from defendant Blaw-Knox by plaintiff Nopco's purchase order dated November 23, 1964, specifically requiring that it meet a certain production capacity when installed and operated in accordance with drawings and instructions.
Blaw-Knox delivered it f.o.b. Buffalo to defendant Central New York Freightways, Inc. and loaded the machine onto Central's truck pursuant to a shipment contract. Central, an I.C.C. carrier, accepted the equipment on July 7, 1965 for shipment to Harrison Warehouse for Nopco as consignee. Upon acceptance of the equipment, Central issued a "clear receipt" to Blaw-Knox.
The next day Central transported the dryer on a flatbed truck to its Harrison destination as specified in the bill of lading. There defendant Harrison Warehouse Corporation's employees unloaded the dryer and placed it in the warehouse for storage. Harrison acknowledged that the dryer was received on July 8, 1965 for Nopco's account and that it was stored until on or about August 5 of that year.
On or about the latter date, Belby Transfer Company, under agreement with plaintiff, sent a truck-crane, which Belby had hired from defendant John S. Geiger & Sons, Inc., to Harrison Warehouse. The machine was loaded on Belby's truck by means of cables from an overhead crane operated by Harrison's employees. Belby delivered the dryer to plaintiff's plant. Either Belby's or Geiger's employees lifted the dryer to the third floor of the Nopco plant by means of a cable and crane operation. After the deposit of *26 the dryer in the proper location, Nopco's employees connected the steam piping and the electrical connections but did not move the dryer itself. Plaintiff's employees first discovered the damage which rendered the machine inoperable after its delivery to the Nopco plant when, in the presence of W.S. Woodhouse, Blaw-Knox's field engineer, the paper wrapping was removed from the drum.
There was credible evidence that the dryer was damaged in more than one area. The drum was damaged along the edge rendering the machine inoperable. This area had been covered by a heavy paper wrapping. Although that wrapping was smudged and scraped, the protective covering itself was not torn through. Damage to the trunnion or axle and flange was also present. This damage was visible at the time of the delivery to plaintiff. At that time Hannett, an engineer then employed by Nopco, determined that the markings on the trunnion would not interfere with the machine's operation, and that this damage was not caused by Belby. Thereupon, he issued a clear receipt to the Belby Transfer Company.
Further damage consisted of a series of small dents on the inside of the drum. However, it appears that this defect did not seriously affect the operation of the dryer.
Lastly, injury to the interior lining of the drum was caused by a revolving internal knife. This damage occurred after necessary repairs had been effected as to the previously listed defects.
Plaintiff offered no direct proof as to how the dryer was damaged. Nopco reasoned that since the machine was in a damaged and defective condition when it arrived at its plant, one or more of the defendants were responsible for the condition of the dryer. Plaintiff charged Blaw-Knox with negligence and with breach of contract and warranty as to fitness of the equipment for the use intended. Central New York Freightways, Inc. was included as a defendant on the basis of negligence and its absolute liability as an I.C.C. carrier. Plaintiff also charged John S. Geiger *27 & Sons with negligence, Harrison Warehouse with negligence based on breach of its duties as a warehouseman, and Belby for negligence as an intrastate carrier and bailee. No specific act of negligence was contended as against any defendant, nor did plaintiff offer to prove in whose hands the damage occurred.
In addition to the foregoing facts, plaintiff offered proof on the basis of interrogatories propounded to Blaw-Knox. It appears that Blaw-Knox's employees arranged with Central for delivery of the machine to the Harrison Warehouse as per Nopco's request; that Blaw-Knox used a crane and cable with wooden blocks between it and the drum when it loaded the machine onto Central's truck; that on or about September 15, 1965 its field engineer inspected the dryer at plaintiff's plant for the purpose of making a test operating run, and that as a result of that examination damage was discovered to the chrome plating on the drums. Visible cable marks were proximate to the damaged portions of the machine.
Central answered, in response to interrogatories, that Blaw-Knox loaded the machine onto the truck by crane; that the dryer was tied down on the truck by block chain and tarpaulin, and that on delivery to the warehouse the machine was unloaded by Harrison by use of a crane and cable.
Through similar interrogatories, Harrison stated that it took the dryer off the truck by means of an overhead crane; that Harrison received one crate, one skid, one motor and three boxes; that the "dryer was crated and skidded," and the "chrome plated roller assembled were within drier [sic] paper wrapped"; that the dryer was moved after being unloaded, and when reloaded onto Belby's truck was lifted by a cable and an overhead crane aided by slings placed under the skid and dryer; that Harrison's employees inspected the dryer on its arrival on July 8, and its departure on or about August 5, 1965, and that no damage was noted while the equipment was in Harrison's possession.
Belby, in answer to interrogatories, stated that when the dryer was being picked up inside the warehouse it was loaded *28 by means of an overhead crane operated by Harrison's employees using rope cables cable slings passed under the crated and skidded dryer and hooked to the crane's lifting cable; that upon delivery to Nopco the dryer was hoisted to the third floor of plaintiff's building by means of the truck crane in an operation in which "cables from truck crane were fastened to slings under skid and drier [sic] * * * [and was] placed in from bed of truck into third floor opening of Nopco building."
Plaintiff also offered the testimony of its plant engineer, Dennis Batchelar. He, along with Hannett, viewed the machine at the Harrison Warehouse several weeks after its arrival at the warehouse. At that time the machine was skidded, the drums were wrapped in paper and the remaining parts, the crates, hood and motor, were stationed beside them. He did not remove or look under the paper or see the drums themselves.
Batchelar procured the Belby Transfer Company to transport the machinery from the warehouse to the Nopco plant. Upon delivery to the plant, the dryer was lifted by crane to the third floor. He averred that Nopco did no lifting or hoisting of the machine and that no work was done by Nopco's employees on the dryer other than steam fitting and electrical connecting work. He testified that Woodhouse, Blaw-Knox's field engineer, showed him the damage after the dryer was delivered to the Nopco plant. Woodhouse found that "damage occurred on the edge of the drums where the cylindrical surface meets the flat end of the drums right on the corner" and in "several places where the chrome surface was broken."
Batchelar stated that there were cable marks on the trunnions, which are the "axles of the drums that fit in the end frames." The engineer expressed the opinion that a cable had been applied to the trunnions, attached to a crane or hook and drawn up. As it was being lifted, the cable pinched in against the flange and edge of the drum causing abrasion and damage. Batchelar was also shown photographs of the *29 dryer which he testified reflected the damage to the drums as well as the attempted repairs made by the Mirror Plating Company at the Nopco plant.
Batchelar added that Woodhouse, after inspecting repairs made by Mirror Plating at Nopco's premises, indicated that the machine was still not operable. After some discussion with Blaw-Knox's representatives, it was decided that rather than send the machine to the plating company directly, it should be sent to Blaw-Knox who would in turn send it to the plating people. Upon the return of the drums from Buffalo to Nopco, an operating test was conducted. At this time additional damage (having no connection with the original defect) was caused by the internal knives of the dryer. As a result of further discussions with Woodhouse, it was concluded that the drums had to be "stoned" to correct the damage. This stoning took place at the Nopco plant. On March 1, 1966 the machine performed satisfactorily for the first time.
Hannett testified that he was present at Nopco when the paper wrapping was removed. The damage to the dryer was first discovered in Woodhouse's presence. Hannett stated that he had visited Harrison Warehouse for the purpose of verifying that all the parts had arrived. Although he did not inspect the equipment, he did notice smudge marks on and slight tears in the paper covering the drums. He corroborated Batchelar's testimony as to the attempted field repair by Mirror, the negotiations with Blaw-Knox, and the subsequent knife damage. He expressed the opinion, as an engineer, that the damage to the drum was caused by the impression left by a steel cable attached on the trunnion end.
The trial court, in dismissing the action against all defendants, ruled that plaintiff had failed to sustain the burden of proof that any particular defendant was responsible for the damage. Over plaintiff's objection, the court also granted defendants' applications to withdraw their various cross-claims for contribution on the theory that since plaintiff *30 could show no right of recovery against any one of them, it was not entitled to insist they proceed to adduce evidence on the issues thus raised.
In large degree, plaintiff's dilemma arose because the equipment had to be shipped and handled by various unconnected concerns en route to its plant. This circumstance would render it unlikely that plaintiff, any more than any other purchaser of merchandise shipped by carrier and stored by warehousemen, would have acquired or could have readily obtained information as to when the alleged damage occurred or as to what or who caused it. Discovery procedures, of course, are available, but have practical limitations peculiar to the transportation sector of the commercial world. Moreover, elaborate and expensive discovery methods should not be a prerequisite to a cause of action in all situations. Would not almost the precise situation which confronted the trial court be presented if the item damaged in transit were a household refrigerator, a television, or even a radio? Could it reasonably be argued that in order for the purchaser to recover he ought to be required to take the depositions of all of the persons who successively handled the product?
The Uniform Commercial Code, "Sales," represents a recognition of an allocation of responsibilities between parties to commercial transactions generally in such a way that modern enterprise can be maintained in a practical and inexpensive manner. See, generally, N.J.S.A. 12A:2-201 et seq. So too, the responsibilities of those involved in transportation and warehousing commerce have been modernized by the Interstate Commerce Act (49 U.S.C.A. § 1 et seq.) and Uniform Commercial Code, "Documents of Title" (N.J.S.A. 12A:7-101 et seq.). These codifications embody, in large measure, judicially pronounced developments in the law merchant. These modernizations of commercial law include many situations which require the defendant in a commercial transaction such as that here involved to come forward with information peculiarly available to him.
*31 Plaintiff, of course, could have initially started a separate action against a single defendant. By doing so, the rights and duties existing between Nopco and the particular defendant would be placed in sharper focus. But such a course of action would also have jeopardized Nopco's right of probable recovery by facilitating the defense of the party initially sued that others rather than it were chargeable for the damage. And, if plaintiff failed in its first effort to fix responsibility, it would have no alternative except to proceed against each succeeding or preceding defendant and go through the same process. The public interest in avoiding circuity of action and in maintaining a rational relation between the cost of achieving justice and the value of the subject matter of the litigation allied with plaintiff's self-interest dictated the bringing of a single action.
Certain presumptions established for the protection of a receiver of property in interstate and intrastate commerce, including those where connecting carriers are involved and those concerning common carriers on through shipments, are not available to plaintiff in this case. See Herman v. Railway Express Agency, Inc., 17 N.J. Super. 10 (App. Div. 1951) (recognizing the presumption that injury resulted from negligence of last of line of connecting carriers); New Jersey Bell Tel. Co. v. Penna.-Reading S.S. Lines, 11 N.J. Super. 129 (Law Div. 1950) (establishing liability of delivering carrier under interstate through bill of lading for loss or damage in transit by any of connecting carriers). Compare Dantes v. McGann, 98 N.J.L. 55 (Sup. Ct. 1922), to the situation in this case. See also Prosser on Torts (3d ed. 1964), § 39; 2 Harper and James, The Law of Torts, § 19.7 at 1085, 1089 (1956).
Only one of the parties, Central New York Freightways, is a carrier subject to the jurisdiction of the Interstate Commerce Commission. Belby is the only other carrier. Furthermore, the goods were not shipped on a through bill of lading to plaintiff's plant, but were delivered to Blaw-Knox f.o.b. Buffalo for transportation only to Harrison Warehouse. However, this staggered delivery process should not derogate *32 from the fact that the procedures used were essentially one continuous transaction. The underlying considerations which prompted the common law to shift the burden of producing evidence to the party having peculiar knowledge of the occurrence is equally appropriate in this mercantile transportation transaction.
Here, Nopco was the purchaser of a piece of newly-manufactured machinery. If plaintiff's proofs that its employees merely made the connections and did not work on the dryer itself were given credence, defendants Blaw-Knox, Central New York Freightways, Harrison Warehouse, Belby, and Geiger were the only parties who had anything to do with the manufacture and delivery of this equipment prior to the discovery of the damaged condition. On the basis of such proof, the original damage to the drums and the trunnions had to be attributed to one or more of these defendants. No one contended that the damage was the result of an act of God for which plaintiff could have no recourse.
Whether the burden of coming forward should begin with the bailee last to be in control (see Julius Klugman's Sons v. Oceanic Steam Nav. Co., 42 F.2d 461 (S.D.N.Y. 1930)), or whether a procedure similar to that mandated by the Carmack amendment should be adopted, (49 U.S.C.A. § 20, par. (11)), plaintiff should have the benefit of such evidence.
As each bailee introduces evidence as to its part in the transaction, plaintiff would be entitled to the benefits of that evidence as against the succeeding or preceding bailee.
There is some indication that some, if not all, defendants were issued clear receipts upon their delivering the dryer to the successive party. Although such a receipt may be prima facie evidence of delivery visably in good order, the clear receipt does not have a like effect with respect to any concealed damage, nor does it relieve the respective party of the duty of coming forward with evidence on this score. Cf. Lincoln Farm Products Corp. v. Central R.R. of N.J., 81 N.J. *33 Super. 161 (App. Div. 1963); Silver Lining Inc. v. Shein, 37 N.J. Super. 206 (App. Div. 1955).
Since the record is not entirely clear as to whether Geiger & Sons supplied the truck-crane for use by Belby, or whether its men also participated in rigging the apparatus or in the unloading operation, disposition of the motion to dismiss as to this defendant should also be held in abeyance until the conclusion of the evidence. The record indicates that an indemnification agreement exists protecting Geiger. However, Belby's liability to Geiger under the agreement must await disposition as a cross-claim unless liability thereunder is previously stipulated.
If the successive bailees absolve themselves from liability, that evidence would then be available as against Blaw-Knox in plaintiff's action for breach of contract and implied warranty. N.J.S.A. 12A:2-314 and 315. That Nopco did not follow the method of recovery authorized by the express warranty may not foreclose its right of recovery against Blaw-Knox if that manufacturer did not validly disclaim its implied warranties. N.J.S.A. 12A:2-316. Moreover, since Blaw-Knox through its representatives, negotiated with Nopco to effectuate repairs through a particular means, the efficacy of the sole remedy authorized by the express warranty may have been waived. N.J.S.A. 12A:2-316.
Moreover, the secondary damage to the drum lining caused by the revolving knives occurred at plaintiff's plant after the other damage was already corrected. It appears that this malfunction was unrelated to the original damage. Blaw-Knox may be independently liable under its implied warranties for this apparent defect. See N.J.S.A. 12A:2-314, 315 and 316.
Plaintiff's evidence, together with all legitimate inferences therefrom, presented at least a sufficient basis for requiring that each of those defendants in whose custody and control the damage might have occurred to come forward with evidence as to their respective part in the transaction. Cf. Gould v. Winokur, 104 N.J. Super. 329, 332 (App. Div.), certif. *34 den. 53 N.J. 582 (1969). The decision on the motions for dismissal and on the defendants' various cross-claims should have been held in abeyance until the close of all the evidence. See R. 4:37-2(b) and (c) and 37-3.
Such action by the court represents no radical departure from existing procedures and imposes no onerous or unreasonable burden on any defendant already a party to the litigation. Most important, it permits an adjudication on the merits, the ultimate goal of every judicial proceeding.
I would reverse and remand for a new trial.
NOTES
[1] The nature of the damage strongly suggests it was done by only one of defendants Blaw-Knox, Harrison Warehouse, or Geiger and Belby (who worked together) However, there is also a slight possibility from the evidence that the damage was done by the steam-fitters, electricians or other workers who connected up the equipment for plaintiff after it was delivered and before the damage was discovered. Discovery of the damage, under the varying proofs, could have been three days or three weeks after delivery of the equipment.
[2] See footnote 1, above. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582602/ | 31 So. 3d 371 (2010)
Kathleen B. THALLER, Rose A. Evans, Helene Huddleston and Gina Cursain
v.
Michael D. HAYDEL.
No. 2010-C-0175.
Supreme Court of Louisiana.
April 5, 2010.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582598/ | 62 N.W.2d 537 (1954)
158 Neb. 143
Application of CITY OF SEWARD.
CITY OF SEWARD
v.
GRUNTORAD et al.
No. 33456.
Supreme Court of Nebraska.
February 5, 1954.
*538 *539 William L. Walker and Earl Ludlam, Lincoln, for appellants.
Paul H. Bek and Harry L. Norval, Seward, Leonard A. Flansburg, Lincoln, for appellee.
Heard before SIMMONS, C. J., and CARTER, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.
SIMMONS, Chief Justice.
This is a proceeding brought in the county court by the city of Seward to condemn two pieces of real estate. The property was alleged to be owned by Louis E. and Lillian Gruntorad, hereinafter called the appellants, and the Seward County Agricultural Society, hereinafter called the Society. Appraisers were appointed. On June 16, 1952, the appellants filed an answer in which they alleged a series of reasons to sustain the prayer of the answer that the petition of the city to condemn be dismissed. The appraisers reported June 17, 1952, fixing the damages of the appellants as $1,382, and of the Society at $255.
On June 20, 1952, the appellants filed a notice of appeal to the district court. On July 16, 1952, appeal bond and praecipe for transcript were filed. On July 17, 1952, the transcript was filed in the district court.
On September 18, 1952, the city filed a motion to dismiss for the reasons that (1) no appeal bond was filed as required by law, and (2) the appellants failed to file a petition in the district court.
On October 8, 1952, the appellants filed a pleading denominated an "Answer and Cross-Petition" together with interrogatories. On October 15, 1952, the appellants filed a motion for leave to file a petition, a copy of which was attached to the motion. This proposed petition sought a dismissal of the city's action, a decree directing a restoration of the property to the condition in which it was when taken in condemnation, a decree declaring that they owned all of the property, and if dismissal was not granted, that they recover consequential damages.
To this motion the city filed objections and renewed the motion to dismiss. The *540 date of the filing of this motion does not appear in the transcript.
On June 4, 1953, the matter came on for hearing in the district court. The journal recites that the Society offered to make an assignment of its award to the appellants "as a condition of dismissal of the appeal." The court ordered the appeal dismissed and required the Society to assign its award to the appellants. From that order the appellants appeal here. We affirm the judgment of the trial court.
The provisions of the eminent domain statute which are to be construed here are found in Chapter 76, article 7, R.S.Supp., 1953. This act was Chapter 101, Laws 1951. It became effective May 21, 1951. The title recites that it was an act, in part, "to provide a uniform procedure for the condemnation of property for public use".
Appellants contend that the act leaves the procedure in conflict and confusion. The conflict and confusion which appellants find disappear when the act is analyzed as to each step in perfecting an appeal and making of issues in the district court on appeal.
In In re Application of Silberman, 153 Neb. 338, 44 N.W.2d 595, 599, we restated these rules:
"`In construing a statute, the legislative intention is to be determined from a general consideration of the whole act with reference to the subject matter to which it applies and the particular topic under which the language in question is found, and the intent as deduced from the whole will prevail over that of a particular part considered separately.
"`Provided always that the interpretation of a statute is reasonable and not in conflict with legislative intent, it is a cardinal rule of construction of statutes that effect must be given, if possible, to the whole statute and every part thereof and it is the duty of the court, so far as practicable, to reconcile the different provisions so as to make them consistent, harmonious, and sensible. Just as an interpretation which gives effect to the statute will be chosen instead of one which defeats it, so an interpretation which gives effect to the entire language will be selected as against one which does not.'"
The above rules have been followed since in Allen v. Tobin, 155 Neb. 212, 51 N.W.2d 338, and Ledwith v. Bankers Life Ins. Co., 156 Neb. 107, 54 N.W.2d 409.
Section 76-715, R.S.Supp., 1953, provides that either the condemner or condemnee may appeal from the assessment of damages by the appraisers. The first step is the filing of a notice of appeal with the county judge within 30 days from the date of filing of the report of the appraisers.
Section 76-717, R.S.Supp., 1953, provides that within 30 days from the filing of the notice of appeal the county judge shall prepare and transmit to the clerk of the district court a duly certified transcript of all proceedings upon payment of the legal fee therefor.
Section 76-717, R.S.Supp., 1953, then provides: "The proceeding shall be docketed in the district court, showing the party first appealing as the plaintiff and the other party as the defendant." There can be no uncertainty as to the meaning of that provision. The Gruntorads as the parties first appealing became plaintiffs in the district court.
The section then provides: "After docketing of the appeal, the issues shall be made up and tried in the district court in the same manner as an appeal from the county court to the district court in a civil action."
Section 24-544, R.R.S.1943, provides that in civil actions either party may appeal from the judgment of the county court "in the manner as provided by law in cases tried and determined by justices of the peace."
Section 27-1303, R.R.S.1943, provides that the justice shall make a certified transcript of his proceedings, including the undertaking *541 on appeal, and deliver it to appellant who shall deliver it to the clerk of the court "within thirty days next following the rendition of such judgment."
Section 27-1305, R.R.S.1943, provides that in such an appeal "The plaintiff in the court below shall be the plaintiff in the district court". Appellants find a conflict between the above provision and that in section 76-717, R.S.Supp., 1953, with reference to the docketing of parties. There is no conflict in fact for the reference to the appeal procedure comes after the designation of the parties is definitely fixed in section 76-717, R.S.Supp., 1953.
Section 27-1306, R.R.S.1943, provides that in all cases of appeal from the county court or justice of the peace, the plaintiff in the court below shall "within fifty days from and after the date of the rendition of the judgment in the court below, file his petition as required in civil cases in the district court, and the answer shall be filed and issue joined as in cases commenced in such appellate court." This is the sentence that has caused in large part the contentions here.
Appellants say the "in the same manner" provision of section 76-717, R.S.Supp., 1953, does not include the time element involved. We see no merit in this contention. The Legislature did not leave a void in the procedure there. Our holdings are to the contrary. See In re Estate of Lindekugel, 148 Neb. 271, 27 N.W.2d 169. The 50-day provision applies.
Appellants say they were not the plaintiffs in the court below and hence the provision in section 27-1306, R.R.S.1943, cannot be applied. As pointed out above the Legislature made them, as parties appealing, the plaintiffs in the district court.
Appellants point out that the provision in section 27-1306, R.R.S.1943, calls for a petition to be filed in the district court "within fifty days from and after the date of the rendition of the judgment in the court below". They then point out that a period of 60 days could have elapsed under sections 76-715 and 76-717, R.S.Supp., 1953, before the filing of a transcript was required in this action in the district court, and they argue that if that provision is applicable, they could be required to file a petition 10 days before the filing of a transcript.
It is obvious that the Legislature intended that a plaintiff under section 27-1306, R.R.S.1943, should have at least 20 days after the filing of a transcript in which to file his petition in the district court. If the issues are to be made up "in the same manner" in the district court in eminent domain under section 76-717, R.S.Supp., 1953, the act should be construed, if it may properly be done, so as to give at least 20 days after the filing of the transcript for the filing of a petition.
Appellants here relate "after the date of the rendition of the judgment" in section 27-1306, R.R.S.1943, to the "filing of the report of appraisers" under section 76-715, R.S.Supp., 1953. They would start the 50-day period from the latter date. Therein is the fallacy of their position. The date of the rendition of the judgment under section 27-1303, R.R.S.1943, is also the date for the beginning of the 30-day period for the preparation and filing of the transcript. The 30-day period for the preparation and filing of a transcript, under section 76-717, R.S.Supp., 1953, begins with the filing of the notice of appeal. Reconciled on that basis the two provisions become consistent and in accord with the obvious legislative intent. Accordingly, we hold that the 50-day period for the filing of a petition in the district court on an appeal in eminent domain proceedings under Chapter 76, article 7, R.S.Supp., 1953, begins to run with the date of the filing of notice of appeal in the county court.
The 50-day period began here then on June 20, 1952, and expired 50 days thereafter, or on August 9, 1952. Appellants filed no pleading until their purported answer and cross-petition on October 8, 1952. Their motion for permission to file a petition came still later on October 15, 1952.
*542 The failure of appellants to timely file a petition in the district court does not affect or defeat jurisdiction. In re Estate of Myers, 152 Neb. 165, 40 N.W.2d 536.
Section 27-1307, R.R.S.1943, provides in part: "If the plaintiff in the action before the justice shall appeal from any judgment rendered against such plaintiff, and after having filed his transcript and caused such appeal to be docketed according to the provisions of this article, shall fail to file his petition within fifty days from the date of the rendition of such judgment by the justice, unless the court, on good cause shown, shall otherwise order, or otherwise neglect to prosecute to final judgment, the plaintiff shall become nonsuited; * * *."
We construed this statute in In re Estate of Lindekugel, supra. We applied it in In re Estate of Myers, supra, and held: "A discretionary duty is imposed upon a district court to determine whether or not good cause has been shown for the failure of a party to plead within the time required, and after the court has heard the reasons of the party in default for his failure to timely plead, and in the exercise of a legal discretion has decided that no sufficient cause has been shown, this court will not ordinarily disturb the decision of the district court."
The question then is: Was good cause shown?
In their motion for leave to file a petition appellants recited their contentions, heretofore determined, recited that they believed that it was the duty of the city to file a petition in the district court, and that it was not their duty to do so; they recited their contention that the procedure was confusing, uncertain, and doubtful, and stated that the court should prescribe rules of procedure and order issues made up accordingly. It is to be noted that this showing and request, if it be termed such, for rules of procedure was filed over 2 months after appellants were in default of a petition, and almost a month after the city had on file its motion to dismiss.
When this matter came on for hearing on the motion to dismiss on June 4, 1953, appellants offered their affidavit of counsel in evidence. It is preserved in a bill of exceptions as the only evidence offered at that time. This affidavit recites that appellants' first knowledge of the city's motion to dismiss was had on October 8, 1952, when the answer and cross-petition was filed; that after the statutory provision as to the first appellant being designated a plaintiff the procedure provided becomes uncertain, confused, and doubtful; and that the uncertainty, confusion, and ambiguity is sufficient reason and good cause for their failure to file a petition.
Appellants were in default of a pleading when the city filed its motion to dismiss on September 18, 1952; they remained in default 20 days thereafter when they undertook to file an answer to a petition which was not on file, and it was a week later that they undertook to get permission to file a petition and get guidance from the court. We find no abuse of discretion on the part of the trial court in dismissing the action.
Finally it is urged that the court erred in taxing all costs to appellants. The journal entry makes no reference to costs. Assuming, however, that the costs have been taxed to appellants, we determine the question to prevent a further appeal on that matter. The ordinary rule is that the successful party is entitled to a judgment for costs. Tobas v. Mutual Building & Loan Ass'n, 147 Neb. 676, 24 N.W.2d 870.
Section 76-720, R.S.Supp., 1953, provides: "If on any appeal, the appellant shall not obtain a more favorable judgment than was given by the report of the appraisers, the appellant shall be adjudged to pay all costs made on the appeal."
Appellants contend that they received a more favorable judgment in the district court than that given by the report of the appraisers because of the provision of the decree that the Society should make *543 an assignment of its award to appellants. The report of the appraisers remained exactly the same. It was not changed. The appellants, at best, received only an assignment of the award of a party not appealing. The statute does not relieve them from costs under these circumstances.
The judgment of the trial court is affirmed.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585034/ | 147 Mich. App. 282 (1985)
382 N.W.2d 769
FREEMAN-DARLING, INC.
v.
ANDRIES-STOREN-REYNAERT MULTI GROUP, INC.
Docket No. 78914.
Michigan Court of Appeals.
Decided November 19, 1985.
Federlein & Grylls, P.C. (by Walter J. Federlein), for plaintiff.
*283 Honigman, Miller, Schwartz & Cohn (by Ronald S. Longhofer and David B. Jaffe), for defendant.
Before: J.H. GILLIS, P.J., and CYNAR and R.L. EVANS,[*] JJ.
PER CURIAM.
The appellant, Freeman-Darling, Inc. (hereinafter Freeman), initiated this cause of action seeking the recovery of damages from defendant-appellee Andries-Storen-Reynaert Multi Group, Inc. (hereinafter ASR), due to ASR's allegedly negligent failure to properly perform its contract with the State of Michigan. The trial court granted the appellee's motion for summary judgment pursuant to GCR 1963, 117.2(1). The resulting appeal is as of right.
The instant case arose out of the construction of the Ypsilanti Correctional Facility by the State of Michigan under a "multi-prime" contract arrangement. Under this plan, rather than hire a general contractor to coordinate the construction, the state awarded nine different contracts covering various phases of the facility's construction. Each of the nine contractors entered into separate contracts directly with the state.
Under the terms of its contract with the state, ASR was required to furnish special locking hardware for a security system to be built into the facility's administrative/medical building. The basis of Freeman's complaint against ASR was that, in selecting a subcontractor to perform the installation of the security locking system, ASR caused an unreasonable delay which affected Freeman's ability to proceed with and fulfill its own contractual obligations. In causing the work delay, it was alleged that ASR breached certain duties owed to *284 Freeman, to-wit: the duty "to perform its work in accordance with the expressed and implied terms and conditions of defendant ASR's contract with the Owner [the state]", and the duty "to refrain from taking actions, inactions, and making omissions, which a similarly situated construction contractor would know, and otherwise should know, would injure plaintiff and plaintiff's conduct and execution of its work pursuant to plaintiff's contract with the owner".
In essence, the theory upon which Freeman seeks to recover against ASR is the "negligent interference with a contractual relationship". We are therefore presented with an action in tort based upon the defendant's failure to perform its contract with a third party. The issue to be resolved, then, is whether Michigan recognizes such a cause of action.
Appellant Freeman begins its argument on appeal by citing two Michigan Supreme Court cases, Clark v Dalman, 379 Mich. 251; 150 NW2d 755 (1967), and Williams v Polgar, 391 Mich. 6; 215 NW2d 149 (1974), for the broad generalization that "Michigan recognizes an action in tort in favor of a non-contracting party which arises out of a contractual relationship". We believe the import of Clark and Williams was more accurately described in Crews v General Motors Corp, 400 Mich. 208, 220-232; 253 NW2d 617 (1977) (opinion by WILLIAMS, J.), where Justice WILLIAMS indicated that Clark stood only for the proposition that "a duty underlying an action in tort may arise out of a contractual relationship". Crews, supra, p 225 (emphasis supplied). However, "a tort action will not lie when based solely on nonperformance of a contractual duty". Crews, supra, p 226 (emphasis in original).
The distinction between the above-stated propositions, *285 although difficult to make, is significant. The concepts with which we are concerned were fully explored by the Supreme Court in Hart v Ludwig, 347 Mich. 559;79 NW2d 895 (1956). The contract in Hart was for the care and maintenance of an orchard owned by plaintiffs which the defendant failed to complete. As in the present case, the plaintiffs alleged that defendant's omissions were contrary to the common law and constituted negligence. In analyzing the viability of an action in tort arising solely out of the breach of a contract, the Hart Court cited the following passage from a Massachusetts case, Tuttle v Gilbert Manufacturing Co. 145 Mass 169; 13 N.E. 465 (1887), which involved a suit by a lessee for injuries sustained when a barn floor, which the lessor had agreed to repair, collapsed:
"`The action of tort has for its foundation the negligence of the defendant, and this means more than a mere breach of a promise. Otherwise, the failure to meet a note, or any other promise to pay money, would sustain an action in tort for negligence, and thus the promissor be made liable for all the consequential damages arising from such failure.
"`As a general rule, there must be some active negligence or misfeasance to support tort. There must be some breach of duty distinct from breach of contract. In the case at bar, the utmost shown against the defendant is that there was unreasonable delay on its part in performing an executory contract. As we have seen, it is not liable by reason of the relation of lessor and lessee, but its liability, if any, must rest solely upon a breach of this contract.'" Hart, supra, p 563.
The Court went on to identify the important distinction as being one of misfeasance, which may support an action in either tort or contract, and nonfeasance of a contractual obligation, which *286 gives rise only to an action on the contract. The Court elaborated as follows:
"There are, it is recognized, cases in which an incident of nonfeasance occurs in the course of an undertaking assumed. Thus a surgeon fails to sterilize his instruments, an engineer fails to shut off steam, Kelly v Metropolitan R Co, [1895] 1 QB 944 (72 LT 551), a builder fails to fill a ditch in a public way, Ellis v McNaughton, 76 Mich. 237 (15 Am St Rep 308). These are all, it is true, failures to act, each disastrous detail, in itself, a `mere' nonfeasance. But the significant similarity relates not to the slippery distinction between action and nonaction but to the fundamental concept of `duty'; in each a situation of peril has been created, with respect to which a tort action would lie without having recourse to the contract itself. Machinery has been set in motion and life or property is endangered. It avails not that the operator pleads that he simply failed to sound the whistle as he approached the crossing. The hand that would spare cannot be stayed with impunity on the theory that mere nonfeasance is involved. In such cases in the words of the Tuttle Case, supra, we have a `breach of duty distinct from contract.' Or, as Prosser puts it (Handbook of the Law of Torts [1st ed], § 33, p. 205) `if a relation exists which would give rise to a legal duty without enforcing the contract promise itself, the tort action will lie, otherwise not.'" Hart, supra, pp 564-565.
Applying these concepts to the facts of Clark v Dalman, supra, reveals its inapplicability to the present situation. The defendant in Clark entered into a contract with the City of Otsego to repair, clean and paint a city water tank. Plaintiff was an employee of an engineering firm responsible for inspecting the defendant's work on the project. In carrying out its contract with the city, defendant coated the walls, floor and ladder inside the tank with an extremely slippery substance. When plaintiff went to inspect defendant's progress, he slipped *287 on the substance and fell to the bottom of the tank. Plaintiff sued, claiming that his injuries resulted from the defendant's failure to notify the engineering firm that the tank had been coated with a greasy substance. In reversing a directed verdict for the defendant, the Supreme Court addressed the crucial duty of care issue as follows:
"Actionable negligence presupposes the existence of a legal relationship between parties by which the injured party is owed a duty by the other, and such duty must be imposed by law. * * *
"* * * Moreover, while this duty of care, as an essential element of actionable negligence, arises by operation of law, it may and frequently does arise out of a contractual relationship, the theory being that accompanying every contract is a common-law duty to perform with ordinary care the thing agreed to be done, and that a negligent performance constitutes a tort as well as a breach of contract. But it must be kept in mind that the contract creates only the relation out of which arises the common-law duty to exercise ordinary care. Thus in legal contemplation the contract merely creates the state of things which furnishes the occasion of the tort. This being so, the existence of a contract is ordinarily a relevant factor, competent to be alleged and proved in a negligence action to the extent of showing the relationship of the parties and the nature and extent of the common-law duty on which the tort is based." 379 Mich. 251, 260-261.
Thus, while the contractual relationship brought the parties together and furnished the occasion of the tort, the defendant owned a general duty, imposed by the common law, "to act so as not to unreasonably endanger the well-being of employees of either subcontractors or inspectors, or anyone else lawfully on the site of the project * * *". 379 Mich. 262. To paraphrase Prosser, a relation existed which gave rise to a legal duty without enforcing the contract promise itself, and thus it *288 was properly held that a tort action would lie. Prosser, Torts (1st ed), § 33, p 205; Hart, supra, p 565.
The same cannot be said of the case now before us. Freeman's only allegation against ASR was that ASR failed to perform the work in accordance with the terms and conditions of its contract with the state.[1] More specifically, ASR allegedly caused an unreasonable delay in connection with its designation of a subcontractor to perform the security locking system installation. As in Hart, ASR did not violate a duty imposed upon all, for the common law does not insist that contractors perform their work without unnecessary delay. Rather, the duty in question was voluntarily assumed by ASR when it entered into a contract with the state.[2] The contractual relationship was not merely the occasion of a duty arising by operation of law; rather, the entire existence of the duty depended upon the contract promise. Therefore, the breach of those contractual obligations could not provide the basis for an action sounding in tort. The motion for summary judgment based upon the failure to state a claim upon which relief could be granted was properly granted.
Affirmed.
NOTES
[*] Recorder's court judge, sitting on the Court of Appeals by assignment.
[1] We note that the facts before us differ from those presented in Hart in that Hart concerned an action in tort based upon the breach of defendant's promise to the plaintiff, while here plaintiff Freeman has based its cause of action upon defendant ASR's breach of promise to a third party, i.e., the state. This distinction does nothing to change the analysis contained herein, however. Since ASR had no legal duty to perform the work in question without enforcing the contract, the legal concepts set out in Hart v Ludwig, 347 Mich. 559; 79 NW2d 895 (1956), require the identical conclusion, i.e., that no action in tort will lie.
[2] The resolution of this case does not require that we address to whom the duty to perform the contracted-for work was owed, and thus we need not consider the effect of Freeman's third-party status in regards to the ASR-State of Michigan contract. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582579/ | 31 So. 3d 1184 (2010)
Ronnie DAVIS and Rebecca Davis Husband and Wife, Plaintiffs-Appellees
v.
Thomas SWEENEY, Defendant-Appellant.
No. 44,997-CA.
Court of Appeal of Louisiana, Second Circuit.
March 3, 2010.
*1186 Malcolm X. Larvadain, for Appellant.
Nelson W. Cameron, for Appellee.
Before BROWN, CARAWAY, and DREW, JJ.
BROWN, Chief Judge.
Plaintiffs, Ronnie and Rebecca Davis, are the owners of a 1989 Glastron ski boat. Defendant, Thomas Sweeney, owns and operates a boat repair shop in Shreveport, Louisiana. Davis took his ski boat to Sweeney for customizing on September 28, 2004, and indicated that he needed the boat back by the summer of 2005. Sweeney agreed. The custom work to be done included, inter alia, painting the boat and trailer in LSU purple and gold, refitting the seats with LSU-colored fabric, and installation of a radio. The agreed upon price for the work was $3,500. A $1,000 down payment was made by Davis, with the balance to be paid upon completion of the work.
Sweeney began the repairs, but, according to him, it was impossible to finish the job at the agreed upon price. Plaintiffs refused to pay additional money, and the work ceased. According to plaintiffs, Sweeney would not let them take their boat, nor would he complete the repairs. Amicable attempts to settle the dispute failed, and the instant suit for breach of contract was filed in Shreveport City Court on December 5, 2006. The matter was tried on April 15, 2008, and the trial court's judgment was signed on April 24, 2008. Judgment was rendered in favor of plaintiffs ordering defendant to pay $2,500 for loss of value and $2,000 for loss of use of the ski boat, together with $600 in expert witness fees. Sweeney was also ordered to return plaintiffs' boat trailer and Evinrude 90 boat motor.[1] It is from this judgment that defendant has appealed.
Discussion
Defendant first urges that the trial court erred in awarding plaintiffs $2,500 for the loss of value of their ski boat. According to Sweeney, this award was improperly based upon the testimony of Barney Permenter, who was accepted as an expert in *1187 the structural, mechanical and electrical workmanship of boats, not as an expert in the valuation of boats.
The trier of fact, while not bound by expert testimony, must hear and weigh the testimony of experts in the same manner as other evidence. Reasonable and well-founded opinion should be considered. Head v. Head, 30,585 (La.App.2d Cir.05/22/98), 714 So. 2d 231; Watts v. Watts, 552 So. 2d 738 (La.App. 1st Cir. 1989). The weight to be given to an expert's testimony is dependent upon the professional's qualifications and experience of the expert and especially upon the facts on which that expert's opinion is based. Head, supra; Goodwin v. Goodwin, 618 So. 2d 579 (La.App. 2d Cir.1993), writ denied, 623 So. 2d 1340 (La.1993). The effect and weight to be given the expert's testimony depends on the validity of the underlying facts relied upon by the expert and rests within the broad discretion of the trial judge. Head, supra.
The record does not show an abuse of the trial court's discretion in this case. Plaintiffs' expert, Barney Permenter, was familiar with the boat and the repairs to it. He visited defendant's shop and examined the boat for 45 minutes to an hour. Permenter noted that the boat was practically a total loss because its hull had been detached. Permenter's opinion was based upon the assumption that the boat was in good operating condition at the time it was presented to defendant for refitting and repair. Davis testified to the condition of the boat at trial, and noted that he paid $5,000 for the boat. Permenter valued the boat at between $1,500 and $2,000. He also stated that the cost to complete painting the trailer would be another $1,000.
There was no contradictory expert evidence presented. Furthermore, as observed by Permenter, inasmuch as the boat had been taken apart and rendered unrepairable, it was impossible to determine the market value of the ski boat as of the time of trial. We cannot say that the trial court's award of $2,500 is clearly wrong or manifestly erroneous in light of the evidence presented at trial.
In his second assignment of error, defendant asserts that the trial court erred in awarding plaintiffs damages for loss of use. Sweeney contends that this award was an impermissible nonpecuniary damage award under La. C.C. art. 1998.
Damages for nonpecuniary loss may be recovered when a contract, because of its nature, is intended to gratify a nonpecuniary interest and, because of the circumstances surrounding the formation or the nonperformance of the contract, the obligor knew or should have known, that his failure to perform would cause that kind of loss. La. C.C. art. 1998.[2] Thus, if plaintiffs can show that they intended to gratify a significant nonpecuniary interest by way of the contract, and the nature of the contract supports this contention, and that Sweeney either knew or should have known that failure to perform would cause nonpecuniary damages to the Davises, then such damages are recoverable. Young v. Ford Motor Co., Inc., 595 So. 2d 1123 (La.1992); Stonecipher v. Mitchell, 26,575 (La.App.2d Cir.05/10/95), 655 So. 2d 1381. Whether the gratification of some nonpecuniary interest is a principal object of a contract is a question of fact. Id. When damages are insusceptible *1188 of precise measurement, much discretion is left to the court for the reasonable assessment of those damages. La. C.C. art. 1999; Stonecipher, supra.
Ronnie Davis testified about the pleasurable family experiences he, his wife and children had when they used their ski boat for camping, cruising or skiing. Davis also stated that when he left his boat in 2004 for refitting/customization, he told Sweeney that although there was no rush on the job, he needed the boat back for the summer of 2005. Mrs. Davis requested that the family be allowed to use the boat for the Christmas festival in Natchitoches, but Sweeney refused to return the boat, even for a weekend. Both plaintiffs testified to the loss of use and enjoyment of their ski boat. The trial of this matter was in April 2008; as of that time, plaintiffs' ski boat had been taken apart and was not able to be assembled for any kind of use due to the length of time that its hull had been removed. Plaintiffs lost the use of their ski boat forever; they recovered only the trailer, which did not have its license place, nor were there any taillights or running boards.
When Davis brought his boat to Sweeney, he talked to defendant about "pimping [his] boat out." The specific work they talked about included having the boat painted and the seats upholstered in LSU purple and gold, installation of a radio, and a few other things that were to come after the painting and upholstery work. The parties' agreement was not one for simple repairs, but involved the updating and upgrading of boat's exterior and seating in the colors of the Davises' favorite college team. If Sweeney did not have actual knowledge of the nonpecuniary interest the Davises intended to gratify as a result of the customizing work they wanted done to their boat, he certainly should have. Plaintiffs have established the requisite elements necessary to support the trial court's award of damages for loss of use. We cannot say that the trial court was clearly wrong or manifestly erroneous in its assessment of $2,000 for plaintiffs' loss of use of their ski boat. See, Heath v. Brandon Homes, Inc., 36,184 (La.App.2d Cir.08/14/02), 825 So. 2d 1262; Stonecipher, supra; Taylor v. Burton, 97-1348 (La. App. 3d Cir.03/06/98), 708 So. 2d 531; Isabelle v. Bayliner Marine Corp., 05-2593 (La.App. 1st Cir.11/03/06), not reported in So.2d, 2006 WL 3187573, writ denied, 07-0174 (La.05/11/07), 955 So. 2d 1279.
Finally, defendant argues that the trial court's $600 expert witness fee award is excessive. According to defendant, the trial court compensated plaintiffs' expert at an amount which is more than twice his hourly rate.
The trial judge has great discretion in fixing and awarding costs and expert witness fees. City of Shreveport v. Noel Estate, Inc., (La.App.2d Cir.09/27/06), 941 So. 2d 66, writ denied, 06-2774 (La.01/26/07), 948 So. 2d 171. A trial court's assessment of costs can be reversed by an appellate court only upon a showing of abuse of discretion. Id.; Allstate Enterprises, Inc. v. Brown, 39,467 (La.App.2d Cir.06/29/05), 907 So. 2d 904.
As to expert witness fees, witnesses called to testify as experts shall be compensated for their services, with the amount to be determined by the court and taxed as costs to the party cast in judgment. La. R.S. 13:3666. As noted by this court in City of Shreveport, supra, an expert witness is entitled to reasonable compensation for his court appearance and for his preparatory work. Factors to be considered in setting an expert witness fee include: the time spent testifying, the time spent in preparing for trial, the time spent away from regular duties while waiting to *1189 testify, the extent and the nature of the work performed, the expert's knowledge and attainments, and the helpfulness of the expert's report and testimony. Id.
In the instant case, the record supports the trial court's award of $600 for Barney Permenter's fee. While Permenter stated that his hourly fee was $70 per hour, he spent numerous hours preparing for and then testifying at trial. His in-court time was four hours. Permenter visited defendant's shop, which took 45 minutes to an hour. Permenter examined and investigated the list of supplies purchased by Sweeney, as well as the record of hours allegedly spent by defendant on the project. Finally, Permenter compiled a report for plaintiffs documenting his findings and opinions. We find no abuse of the trial court's discretion in this matter.
Conclusion
For the reasons set forth above, the judgment of the trial court is affirmed. Costs are assessed to defendant-appellant, Thomas Sweeney.
NOTES
[1] The boat had been disassembled and because the hull had been separated from the rest of the boat, it was plaintiffs' expert's opinion that the boat could not be repaired to its original condition. Defendant was allowed to keep the boat together with plaintiffs' $1,000 deposit.
[2] Civil Code article 1998 also provides that, regardless of the nature of the contract, nonpecuniary damages may be recovered when the obligor intended, through his failure, to aggrieve the feelings of the obligee. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582590/ | 976 F. Supp. 171 (1997)
Winifred EUBANKS, Plaintiff,
v.
LIBERTY MORTGAGE BANKING LTD. and its assignee Federal Home Loan Mortgage Corp., "John Doe No. 1" to "John Doe No. 10," inclusive, the last ten names being fictitious and unknown to plaintiff, the persons or parties intended being the persons or corporations, if any, having or claiming an interest in or lien upon the premises described in the declaratory complaint, Defendants.
Civil Action No. CV-96-4753 (DGT).
United States District Court, E.D. New York.
September 11, 1997.
*172 Winifred Eubanks, Freeport, NY, pro se.
James E. Robinson, Meyer, Meyer & Metli, LLP, Smithtown, NY, for Defendants.
MEMORANDUM AND ORDER
TRAGER, District Judge.
Background
Winifred Eubanks mortgaged her home at 40 Willow Street, Freeport, New York to Liberty Mortgage Banking Ltd. ("Liberty") on September 22, 1989. Liberty assigned the fixed-rate mortgage to Federal Home Loan Mortgage Corp. ("Freddie Mac") on the same day. See Exh. A to Compl't.
In November 1992, Freddie Mac commenced foreclosure proceedings against Eubanks. See Exh. 1 to Def. Aff. in Sup. Summ. J. Three years later, Eubanks defaulted in the proceedings and Judgment of Foreclosure and Sale was issued in favor of Freddie Mac. See Exh. 2 to Def. Aff. in Sup. Summ. J. On July 9, 1996, Freddie Mac bought the home at a court-ordered auction. See Exhs. 3 & 4 to Def. Aff. in Sup. Summ. J. On August 27, 1996 Eubanks filed this action pro se, alleging violations of the Truth in Lending Act ("TILA"), 15 U.S.C. § 1601 et seq., in Nassau County Supreme Court. She asks the court to declare that Liberty violated the disclosure provisions of TILA, to declare that damages are available for TILA violations, and to overturn the foreclosure of the state court. See Compl't at 4-5.
On October 1, 1996 Freddie Mac removed the suit to federal court pursuant to 12 U.S.C. § 1452(f) and 28 U.S.C. § 1446 and answered the complaint.[1] On November 7, Freddie Mac requested leave to move for summary judgment on the ground that the current action is barred by the doctrine of res judicata. The next day, Eubanks, in a letter to the court, urged that summary judgment be denied because her claim is a different controversy than the one litigated in the foreclosure action in state court.
Freddie Mac filed its summary judgment papers in February. Despite two letters from Freddie Mac and one from the court asking Eubanks to respond, plaintiff has not answered.
Discussion
Freddie Mac argues that summary judgment should be granted because the doctrine of res judicata bars this court from hearing Eubanks' TILA claims. It contends that any TILA disclosure violations are part of the same transaction that was actually litigated in the foreclosure action in state court. Freddie Mac argues that since Eubanks *173 could have raised TILA violations as counterclaims to Freddie Mac's foreclosure action, she should be precluded from raising them here. See Def. Aff. in Sup. Summ. J. In her letter opposing summary judgment, Eubanks argues that her suit is justiciable since it is based on a different cause of action.
Freddie Mac argues that the foreclosure and TILA claims arise from the same transaction. See Def. Mem. in Sup. of Summ. J. at 4. However, three of the four circuits that have ruled on the issue have held that the claims arise from separate transactions. See Whigham v. Beneficial Finance Co. of Fayetteville, 599 F.2d 1322, 1323-24 (4th Cir.1979). Accord, Maddox v. Kentucky Finance Co., 736 F.2d 380, 382-83 (6th Cir.1984); Valencia v. Anderson Bros., 617 F.2d 1278, 1291 (7th Cir.1980), rev'd on other grounds, 452 U.S. 205, 101 S. Ct. 2266, 68 L. Ed. 2d 783 (1981). Cf. Plant v. Blazer Financial Svcs., 598 F.2d 1357 (5th Cir. 1979). The Second Circuit implicitly endorsed the logic of Whigham in Adam v. Jacobs, 950 F.2d 89, 92-93 (2d Cir.1991).
Even if Whigham is the controlling precedent and the foreclosure and TILA claims are deemed separate, that does not end the matter. A district court must accord the grant of foreclosure in the state action the same preclusive effect that it would be given by New York courts. See 28 U.S.C. § 1738; Brooks v. Giuliani, 84 F.3d 1454, 1463 (2d Cir.1996). New York employs a transactional approach wherein a final decision on the merits bars any future claims based on the same transaction or series of transactions. See Brooks, 84 F.3d at 1463 (citing O'Brien v. City of Syracuse, 54 N.Y.2d 353, 357, 445 N.Y.S.2d 687, 429 N.E.2d 1158 (1981)). This broad rule, however, is usually cited in the context where the plaintiff in the first action brings a second action alleging slightly different facts or evidence or a different cause of action.
New York, however, does not have any compulsory counterclaim rule. Under New York law, "[a] counterclaim may be any cause of action in favor of one or more defendants." N.Y. C.P.L.R. § 3019(a) (emphasis added). Because New York's counterclaim rule is permissive, res judicata generally will not necessarily bar claims that could have been counterclaims in a prior action. See Henry Modell and Co. v. Minister, Elders and Deacons of the Reformed Protestant Dutch Church, 68 N.Y.2d 456, 462 n. 2, 510 N.Y.S.2d 63, 502 N.E.2d 978 (N.Y.1986). Only a defendant who is silent in the first action and then tries to bring a second action that would undermine "the rights or interests established in the first action" is barred under New York's res judicata rule. Id. at 461, 510 N.Y.S.2d 63, 502 N.E.2d 978 (citing Schuykill Fuel Corp. v. C. Nieberg Realty Corp., 250 N.Y. 304, 165 N.E. 456 (1929) (Cardozo, J.)) New York's res judicata rule thus has a narrower effect on a defendant who then brings her claim in a separate action than it does on the plaintiff who brings successive claims that arise from the same transaction.
New York's statute making all counterclaims permissive is in marked contrast to the federal rule which requires the defendant to "state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim...." Fed.R.Civ.P. 13(a). The only permissive or non-compulsory counterclaims under the federal system are those "not arising out of the transaction or occurrence that is the subject matter of the opposing party's claim." Fed.R.Civ.P. 13(b).
The federal counterclaim rule is intended to conserve judicial resources by requiring parties to resolve all claims arising from the same transaction in one suit. See Banco Nacional de Cuba v. Chase Manhattan Bank, 658 F.2d 875, 885 (2d Cir.1981). New York ensures that its permissive counterclaim rule will not result in inconsistent verdicts, see Henry Modell and Co., 68 N.Y.2d at 461, 510 N.Y.S.2d 63, 502 N.E.2d 978, but also gives greater autonomy to a defendant unwillingly haled into court to litigate her claim in a second action if that is her choice.[2]
Eubanks did not impose her TILA claim as a counterclaim in the foreclosure action. See Def. Mem. of Law in Sup. Summ. J. at 4. Following that `silence,' she sued in a second action in an attempt to overturn the decision *174 in the first action. Under New York's doctrine of res judicata, this court cannot overturn the decision of the state court in the foreclosure action or declare that she owns the home outright. Doing so would necessarily undermine the rights established in the foreclosure action.[3] Those forms of relief are barred.
TILA provides borrowers only two remedies for disclosure violations: (1) rescission, see 15 U.S.C. § 1635 and (2) damages. See 15 U.S.C. § 1640. Rescission is not an available remedy for residential mortgages. See 15 U.S.C. § 1635(e)(1)(A). Since Eubanks alleges that Liberty and Freddie Mac violated TILA in providing her with a fixed rate mortgage in her home, see Compl't at 4-5 & Exh. A, rescission is not available to her. Moreover, even if recission were available, then res judicata might well apply since such a remedy would undermine the judgment in the foreclosure action.
As for the damages remedy, an action for damages under TILA must be brought within one year from the alleged violation. See 15 U.S.C. § 1640(e). Though one court has held that the limitations on actions is subject to equitable tolling in instances of fraud, see Jones v, TransOhio Savings Ass'n, 747 F.2d 1037, 1041 (6th Cir. 1984), Eubanks has not alleged fraud with the particularity needed to toll the statute. She has filed a boilerplate complaint composed of entirely conclusory language seven years after the alleged violations occurred. Thus Eubanks' action for damages is time barred. Since Eubanks has no remedy available to her under TILA, her complaint must be dismissed for failing to state a claim upon which relief may be granted. See Fed. R.Civ.P. 12(b)(6).
It appears that defendant Liberty Mortgage Banking Ltd. has not been served in this action as no affidavit of service has been filed. However, even if Liberty has been served, Eubanks' claims against Liberty are barred for the same reasons stated above.
Conclusion
To the extent that the relief sought by Eubanks seeks to overturn the foreclosure action and declare that she owns the property outright, summary judgment is granted. Since there is no relief available to her under the Truth in Lending Act, the rest of her complaint is time barred and is, therefore, dismissed. The Clerk of the Court is instructed to enter judgment accordingly and close the case.
NOTES
[1] Liberty has not appeared in this action. According to Freddie Mac, Liberty was never served. See Def. Aff. in Sup. Summ. J. ¶ 6.
[2] Two complaints virtually identical to the one filed by plaintiff here were dismissed on res judicata and statute of limitations grounds. Nembhard v. Citibank, N.A., No. CV-96-3330, 1996 WL 622197 (E.D.N.Y. Oct.22, 1996) and Smith v. Prudential Home Mortgage Co., No. CV-96-1722 (E.D.N.Y. Feb. 27, 1997). Each of these opinions discussed New York's broad transactional approach to res judicata, but neither addressed the fact that in New York all counterclaims are permissive and can be brought in a separate action with the limitation that they cannot disturb the rights established in the first action. See N.Y. C.P.L.R. § 3019(a); Henry Modell and Co., 68 N.Y.2d at 462 n. 2, 510 N.Y.S.2d 63, 502 N.E.2d 978. Furthermore, neither decision contained a transactional analysis. For these reasons, I do not agree with these decisions.
[3] This court is also barred from disturbing the decision of the state court under the Rooker-Feldman doctrine under which inferior federal courts do not have the subject matter jurisdiction to hear cases that seek review of a decision of a state court. See Moccio v. New York State Office of Court Admin., 95 F.3d 195, 197 (2d Cir.1996). Also, material violations of TILA do not discharge an obligor of her obligation to pay the mortgage. See 15 U.S.C. § 1610. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582770/ | 339 Mich. 1 (1954)
62 N.W.2d 641
KROON
v.
KALAMAZOO COUNTY ROAD COMMISSION.
Docket No. 2, Calendar No. 45,897.
Supreme Court of Michigan.
Decided February 18, 1954.
Fox, Fox & Thompson, for plaintiff.
L.J. Carey and George J. Cooper (Bruce W. Griffin, of counsel), for defendants.
CARR, J.
On the 27th of June, 1951, Joseph Kroon, the son of the plaintiff herein, was working for the defendant Road Commission at a gravel pit in Kalamazoo county. Several pieces of equipment used in connection with the work were located in proximity *3 to the pit. Such equipment included a crane with a 40-foot boom raised approximately 30 feet in the air and a screening machine 13 feet in height. About 2:30 p.m. it began to rain, and Kroon started towards the screening machine for shelter. He was at the time carrying over his left shoulder a wooden handled shovel with a metal scoop, the scoop extending approximately one foot above his head. Before he had reached the screening machine and when he was approximately 300 feet distant from it he was struck and killed by a bolt of lightning. The record indicates that such bolt was the only one in the vicinity during the afternoon. Apparently the lightning struck the point of the shovel, melting it, burned a place on the handle, and thence entered the body of the deceased.
Plaintiff instituted the present proceeding, claiming partial dependency and that the death of her son resulted from a compensable injury arising out of and in the course of the employment. The deputy of the workmen's compensation commission before whom the proofs were taken found in plaintiff's favor. The award made, modified only as to the date of the injury, was affirmed by a majority of the commission, one member dissenting. Defendants, on leave granted, have appealed, claiming that there was no evidence before the workmen's compensation commission to support its finding.
On the hearing before the deputy, plaintiff offered the testimony of Dr. Paul Rood, chairman of the department of physics at Western Michigan College, who testified that he had studied electricity, including lightning, as a branch of physics, reading authoritative works on the subject. His testimony was received on the theory that he had been properly qualified as an expert. In answer to a hypothetical question he stated in substance that in his opinion the likelihood of Kroon being struck by a lightning *4 bolt was increased because of the fact that he was carrying the shovel over his shoulder and that it projected above his head. The following excerpt from his testimony indicates its general nature:
"Q. We have no idea of the area where a bolt of lightning is going to strike?
"A. Yes, I should say we do. I will put it this way: If we knew where the charge and the crack was in the cloud just moving by, if we knew where the charge was we would have a very good idea where the lightning might strike.
"Q. Well, over how large an area?
"A. We can't say because we can't measure where that charge is. It may be over quite a large area. It may be over a limited area.
"Q. Let's say a large area; how large would that be?
"A. I wouldn't be able to say.
"Q. Would you say over an area of a mile in circumference?
"A. It could be, I suppose. I would guess that it was not of that size. I would say smaller than that.
"Q. Would you say a half mile in circumference?
"A. Again I don't like to say definitely. I would say it could be over an area as small as a few feet in diameter, the charge concentration, or it could be over an area perhaps a half mile long. It depends entirely
"Q. Then if it were in an area let's say a half mile in diameter, it would be more likely that lightning would strike an object that was the highest in that immediate vicinity?
"A. That is true. * * *
"Q. In your studies, Doctor, the phenomena of lightning, have you run across very many cases where a man has been struck by lightning on level ground?
"A. Not in my own experience, but I have heard from other sources that this has happened. I'll take that back. I wouldn't say definitely when a man was *5 walking along on level ground, I don't know of a particular case, but I have heard of many cases of men being struck by lightning. Not specifying under what conditions, because I don't have the facts on that. * * *
"A. One thing I think we could say, we do know, and this also I believe is accepted by the man that studies lightning, is that if the man carrying the shovel 7 feet high is struck, he would receive the bolt of lightning which might have hit the ground in that area at any place over a circle of a diameter of 28 feet. They usually use a 4 to 1 ratio. That is, the man was in the center of a circle 28 feet in diameter, if anywhere in that circle a point on the ground would be struck without the man there, when the man is there he gets it, no matter where he is in that circle.
"Q. No matter whether he is carrying a shovel?
"A. I am assuming a man with a shovel 7 feet high, and 28 feet would be sort of a protected area, and 28 feet in diameter around this man he would get the charge of the bolt of lightning that might strike in this area.
"Q. Without the shovel?
"A. Four to one. It is 24.
"Q. Twenty-four if he didn't have the shovel, and also within this area the chances are he would be struck by lightning, if it was within an area of 24 feet?
"A. Yes.
"Q. Because he does have the shovel and puts the point up 1 foot higher, then we have an area of 28 feet?
"A. The chances are as 28 squared to 24 squared. It varies with the square. I figure it is about a 40% greater chance of being struck, this man, because he carried the shovel 1 foot higher than his head.
"Q. If lightning is in that area?
"A. Yes, sir.
"Q. But if lightning is in that 24-foot area, whether he has a shovel or not, he hasn't got a chance, has he?
*6 "A. If we could assume that the charge is in that area of 24 feet and lightning was going to strike there, it would strike him, let's put it that way.
"Q. We do know then that within a 24-foot area if a man is standing there he is going to get struck by lightning?
"A. No.
"Q. We don't know that?
"A. No.
"Q. By the same token
"A. If lightning was going to strike there. We can't tell. If it was going to strike there anywhere in the 24 foot, if he had no shovel, he would be the one that would be struck, that is the chance.
"Q. And with the shovel in a 28-foot area?
"A. Yes, sir; but I think that is misleading, just to leave it 28 and 24, because the chances don't depend on 28 to 24; it depends on 28 squared to 24 squared."
The award of the compensation commission was based on the testimony of Dr. Rood which, as the excerpts above quoted indicate, was somewhat theoretical in nature rather than factual. Assuming, however, that Kroon would have been struck by lightning had the charge or bolt been within the area of a circle having a radius of 12 feet, Kroon being at the center, without reference to the shovel, and that the presence of the tool over his shoulder increased the area of danger to a circle having a radius of 14 feet, may it be said with any degree of certainty that there was in fact a causal connection between the shovel which he had been using in his work and his death? While legitimate inferences may be drawn from established facts, an award may not be based on speculation and conjecture as to what might have happened. In Ginsberg v. Burroughs Adding Machine Co., 204 Mich. 130, 137, it was said:
"But the inferences drawn must be from established facts; inference may not be built upon inference, *7 possibilities upon possibilities, or inferences drawn contrary to the established facts, contrary to the undisputed evidence. If an inference favorable to the applicant can only be arrived at by conjecture or speculation the applicant may not recover. So if there are 2 or more inferences equally consistent with the facts, arising out of the established facts, the applicant must fail."
It must also be borne in mind that the burden of proof is on the plaintiff to show that the death of her son arose out of his employment, and that she is entitled to compensation as a dependent. This and other basic principles were recognized and expressly declared in Riley v. Kohlenberg, 316 Mich. 144, 148, 149, as follows:
"Since by recent amendments to the workmen's compensation act injuries and deaths resulting from occupational diseases have been made compensable, many borderline cases, of which the instant case is typical, have been presented. In deciding such controversies it seems imperative that 3 principles be kept in mind. (1) The burden of proving a right to compensation is on the party asserting that right. Pucilowski v. Packard Motor Car Co., 278 Mich. 240; Veek v. Wesley Freight Co., 306 Mich. 485. (2) In awarding compensation to a plaintiff, the department may not indulge in the assumption of a mere possibility in the nature of a guess as to whether plaintiff is entitled to compensation. Ginsberg v. Burroughs Adding Machine Co., 204 Mich. 130, 137; Marman v. Detroit Edison Co., 268 Mich. 166. (3) Workmen's compensation provided by the act is not intended to be either sickness, health, or life insurance or to provide benefits for employees suffering from ordinary diseases of life."
See, also, Nightlinger v. Giant Super Market, Inc., 334 Mich. 90.
Whether death by lightning may be regarded as a personal injury arising out of and in the course of *8 employment was considered by this Court in Klawinski v. Lake Shore & Michigan Southern Railway Co., 185 Mich. 643 (LRA1916A, 342). There the widow of an employee of defendant applied for dependency compensation because of the death of her husband by lightning. During a rainstorm Klawinski and other employees, members of a section gang on defendant's railroad, sought shelter in a barn. While therein Klawinski was killed by a bolt of lightning. It was in evidence that the employees had gone to the barn at the direction of their foreman or the assistant foreman. It was held that claimant's husband did not come to his death as the result of a personal injury arising out of and in the course of his employment within the meaning of the workmen's compensation act, the Court directing attention to the fact that the legislative intent was to allow compensation for injuries sustained by employees because of "industrial accidents."
Thier v. Widdifield, 210 Mich. 355, involved a factual situation more analogous to that in the instant proceeding than did the Klawinski Case. The defendant employer, Widdifield, was engaged at Charlevoix, Michigan, in the ice, coal and wood business. In connection therewith he maintained a barn located approximately 75 feet from his dwelling house and connected therewith by an insulated electric light wire which entered the barn about 6-1/2 feet above the ground. Thier was employed to deliver ice to customers. On the date of his injury Thier and his employer noticed that a storm was coming and in consequence they put in the barn the team of horses with which they had been working. Thier was standing in the doorway, within a few inches of the point where the electric light wire entered the barn, when he was struck by a bolt of lightning and killed. During the storm the dwelling house was also struck by lightning, but the barn was not. *9 Thier's widow brought proceedings for compensation on the theory that his death resulted from injuries arising out of his employment. An award of compensation was made by the industrial accident board, the predecessor of the present workmen's compensation commission, on the ground that the wire referred to was an agency of man and that it had combined with the elements to produce the injury to the employee. This Court came to the conclusion that the award could not be sustained, saying in part (p 359):
"A careful reading of the testimony contained in this record leads us to differ from the conclusion reached by the board. We are unable to find any evidence to warrant the finding `that the lightning which struck the house, damaging the electric lights, followed the electric wire to the barn and struck and killed the deceased.' Nor do we find any evidence to warrant the finding that the position of deceased was `more hazardous than that of others in the same community; that the deceased by reason of his employment was thereby exposed to injuries from lightning, other than the community in general in that locality, and in consequence thereof met his death.' With due deference to the opinion of the board, we think the findings above referred to were based upon mere conjecture and speculation."
In the more recent decision of Nelson v. Country Club of Detroit, 329 Mich. 479, plaintiff was employed by defendant as a caddy on its golf course. While so engaged a storm arose and plaintiff, with others, sought shelter under a nearby tree. Lightning struck the tree and plaintiff was injured. The deputy commissioner before whom the case was heard denied compensation on the ground that such injuries resulted from an act of God and did not arise out of the employment. The commission came to a different conclusion and awarded compensation. Defendants *10 appealed, claiming that the testimony in the case did not support the award. On the hearing before the deputy, plaintiff offered as a witness an electrical engineer, an expert, who testified in substance that a person in a wide open space is subject to greater danger from lightning than one in or near a building or in small open spaces. On the basis of such testimony it was urged that plaintiff was subjected to a greater risk of being injured by lightning because of his employment on the golf course than were others in the community generally. In setting aside the award and holding that plaintiff was not entitled to compensation, this Court rejected the claim advanced in plaintiff's behalf.
The foregoing decisions of this Court are decisive of the issue in the case at bar. As the testimony of plaintiff's expert witness clearly indicates, there is no way of fixing the area immediately beneath the bolt of lightning. Plaintiff's case rests wholly on the theory that because her son was carrying a shovel that he had been using in his employment the danger of his being injured was increased. However, if such bolt was directed to the area surrounded by a circle with a radius of 12 feet, with Kroon at the center thereof, the increased hazard, under the testimony in the case, would not enter into the result. Under the opinion of the expert witness, the shovel became a factor only in the event that the bolt of lightning struck more than 12 and less than 14 feet from him. An award may not rest on conjecture. Under this record it may not be said that the shovel was a contributing factor to the death of Kroon.
Counsel have cited decisions from other States sustaining the right to compensation, because of death or injury by lightning, under workmen's compensation acts similar to the Michigan statute. Decisions of such character were cited in Thier v. Widdifield, supra, this Court refusing to follow them. *11 Among other decisions so cited was the holding of the Minnesota supreme court in State, ex rel. Peoples Coal Co., v. District Court, 129 Minn 502 (153 N.W. 119, LRA1916A, 344), in which compensation was allowed because of death suffered as a result of being struck by lightning. The employee was engaged in the delivery of ice when a storm arose from which he apparently sought shelter under a tree. This Court in commenting on the case called attention to the fact that the decision had been criticized by the supreme court of Iowa in Griffith v. Cole Bros., 183 Iowa 415 (165 N.W. 577, LRA1918F, 923). Such reference by the Iowa court was quoted, in part, as follows:
"`The vice in this decision seems to us to be that, while it recognizes there must be more than the normal risk from lightning to which all are subject, and that the employment must necessarily accentuate the natural hazard from lightning, this is not followed to its logical end, and a recovery for injury by lightning is allowed where there was no such accentuation or abnormal risk. All that is requisite is that the employment be of such nature as that, in reason, the employee is more exposed to hazards from lightning than is one in some other employment. Cases that hold a given accident from lightning did not arise out of the course of the employment recognize that such injury may be related to the employment. See Hoenig v. Industrial Commission, 159 Wis 646 (150 N.W. 996. LRA1916A, 339).'"
In the course of its discussion the Iowa court quoted with approval from Hopkins v. Michigan Sugar Co., 184 Mich. 87 (LRA1916A, 310), where it was said (p 90):
"An employee may suffer an accident while engaged at his work or in the course of his employment which in no sense is attributable to the nature of or risks involved in such employment, and therefore cannot be said to arise out of it."
*12 Under principles recognized and applied by this Court in its prior decisions, the award in the instant case cannot be sustained. An order will enter remanding to the workmen's compensation commission with directions to set aside the award in plaintiff's favor and to enter an order denying compensation. Defendants may have costs.
BUTZEL, C.J., and BUSHNELL, SHARPE, BOYLES, REID, DETHMERS, and KELLY, JJ., concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1302057/ | 768 N.W.2d 63 (2009)
2009 WI App 56
BEDUHN
v.
UNITED STATES DHSS.[1]
No. 2008AP1549.
Court of Appeals of Wisconsin.
March 4, 2009.
Unpublished opinion. Affirmed and remanded.
NOTES
[1] Petition for Review Filed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582656/ | 31 So. 3d 357 (2010)
STATE of Louisiana
v.
Sean SMITH.
No. 2009-K-2102.
Supreme Court of Louisiana.
April 5, 2010.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582652/ | 31 So. 3d 290 (2010)
Desiderio CUEVAS, Appellant,
v.
The STATE of Florida, Appellee.
No. 3D07-184.
District Court of Appeal of Florida, Third District.
March 31, 2010.
*291 Bennett H. Brummer, Public Defender, and Andrew Stanton, Assistant Public Defender, for appellant.
Bill McCollum, Attorney General, and Lunar Claire Alvey, Assistant Attorney General, for appellee.
Before SHEPHERD and SALTER, JJ., and SCHWARTZ, Senior Judge.
SALTER, J.
Desiderio Cuevas appeals from a final order designating him a sexual predator under section 775.21, Florida Statutes (2006). The issue to be determined in this appeal is whether designation as a sexual predator may be ordered after a defendant has served his sentence and been released (rather than when "before the court for sentencing"[1]).
Cuevas entered a plea of guilty to charges of lewd and lascivious molestation on a child under 12 and lewd and lascivious conduct on a child under 16, in violation of sections 800.04(5)(b) and 800.04(6)(b), Florida Statutes (2000). He was sentenced to a term of 56 months of incarceration, but he was not designated as a sexual predator in a written finding at the time of the sentencing. Cuevas concedes that the convictions qualified him for designation as a sexual predator under the criteria established in section 775.21(4)(a).
In July 2006, as Cuevas neared the end of his term of incarceration, the Department of Corrections sent a written inquiry to the office of the State Attorney to inquire whether Cuevas qualified as a sexual predator. The State Attorney replied that Cuevas did qualify and then filed a motion to designate him a sexual predator. In the interim, Cuevas was released. The State's motion was then set for hearing. The trial court granted the State's motion, and this appeal followed.
We have previously determined that section 775.21 is "regulatory and procedural in nature," such that the provision does not violate the ex post facto clause or impermissibly modify a criminal sentence or punishment. Gonzalez v. State, 808 So. 2d 1265, 1266 (Fla. 3d DCA 2002). Cuevas's case also is not one in which his offense was not a qualifying offense for the sexual predator designation at the time of his sentencing, as occurred in Therrien v. State, 914 So. 2d 942 (Fla.2005).
The statutory analysis here is straightforward. Does the State lose its rightin fact, must it turn aside from its statutory duty[2]to seek the designation if it overlooks that right and duty at sentencing? *292 Cuevas and the dissent apply a strict and inflexible interpretive analysis that might be considered if the question involved the reach of a statute imposing a criminal penalty. But section 775.21 is not such a statute, as we held in Gonzalez. The statute expresses no intention that the consequence of a failure to make a written sexual predator finding at the time of sentencing is a waiver of the right to make the finding in the future. Cuevas and the dissent read such an intention into the fact that two specific categories of "overlooked" defendants are described in section 775.21(5)(c), but we disagree with that inference. A careful reading of the special language applicable to the two categories (section 775.21(5)(a)1. and 3.) reveals that those are special notice and venue rules for those special cases,[3] not exclusive descriptions of the only circumstances in which the State can perform its duty after the defendant is sentenced.
Nor would Cuevas's argument establish a waiver of the State's right to a tardy designation under the civil standard we described in Gonzalez. There is no evidence in this record that the State knowingly or intentionally waived its right to seek the designation, and Cuevas can hardly argue that he was prejudiced by the fact that he received the designation in 2006 rather than at sentencing four years earlier. Cuevas did not raise, and therefore we do not consider here, facts or issues relating to the doctrine of laches or to any statute of limitations.
Finally, the extensive legislative findings, purpose, and intent (expressly written into section 775.21(3)) also support our analysis. To conclude that a Legislature bent on addressing "an extreme threat to the public safety" intended to relieve Cuevas from registration is to engage in statutory destruction, not construction.
Affirmed.
SCHWARTZ, Senior Judge, concurs.
SHEPHERD J., dissenting.
The issue in this case is whether the State of Florida can haul a sexual predator back into court, after he has completed his entire sentence, to declare him a sexual predator as defined by section 775.21(4)(a) of the Florida Sexual Predators Act (2006),[4] in the absence of a statutory recapture provision. I find it cannot and would reverse the order on appeal.
On January 22, 2002, Desiderio Cuevas was sentenced to fifty-six months of incarceration pursuant to a guilty plea on the counts of lewd and lascivious molestation of a child under twelve years of age, *293 § 800.04(5), Fla. Stat. (2000), and lewd and lascivious conduct on a child under sixteen years of age, § 800.04(6), Fla. Stat. (2000). It is agreed that Cuevas is a sexual predator within the meaning of the Florida Sexual Predators Act. See § 775.21(4)(a), Fla. Stat. (2006). The Act requires that for such individuals, the trial court "must make a written finding at the time of sentencing that the offender is a sexual offender." See § 775.21(5)(a)2, Fla. Stat. (2006) (emphasis added).[5] The trial court did not do so. In April 2003, the Florida Department of Corrections recognized it did not have a copy of such an order, and sent a letter to the Clerk of the Court requesting a copy. The Office of the State Attorney also received a copy of the letter. The record contains no evidence that either the Clerk or State Attorney took any action in response to this letter. On July 27, 2006, approximately sixty days before Cuevas' release date, the Department inquired of the State Attorney concerning Cuevas' statutory status. On October 27, 2006, the Office of the State Attorney responded to the Department's July 27th request, stating only that Cuevas "does qualify as a sexual predator." In the interim, on September 6, 2006, Cuevas completed his sentence and was released. Nevertheless, the State continued to press the matter, and on December 15, 2006, the court entered the statutory order prescribed by section 775.21(5)(a)2 over Cuevas' objection.
The State concedes there is no express statutory authority in the Florida Sexual Predators Act of 2006 to haul Cuevas back into court. However, the State argues a fair reading of the statute reveals "the legislature intended to create a mechanism" to do so, which it submits is sufficient. As support for its argument, the State cites two separate subsections of the Act. The first section, 775.21(4)(c), authorizes the recapture of "an offender [who] has been registered as a sexual predator by the Department of Corrections, the [D]epartment [of Law Enforcement] or any other law enforcement agency ... if 1. The court did not, for whatever reason, make a written finding at the time of sentencing that the offender was a sexual predator...." (Emphasis added.) However, the State's reliance upon this subsection of the Act is misplaced. It is undisputed Cuevas was never registered as a sexual predator pursuant to the Act.[6] In *294 fact, he was released without any judicial consideration concerning whether he should be designated a "sexual predator," a clearly defined status within the meaning of the Florida Sexual Predators Act. See § 775.21(4)(a).
The other section of the Act upon which the State seeks affirmance of the trial court's action in this case is subsection 775.21(5)(c). This provision states:
If the Department of Corrections, the [D]epartment [of Law Enforcement], or any other law enforcement agency obtains information which indicates that an offender meets the sexual predator criteria but the court did not make a written finding that the offender is a sexual predator as required in paragraph (a), the Department of Corrections, the department, or the law enforcement agency shall notify the state attorney who prosecuted the offense for offenders described in subparagraph (a)1., or the state attorney of the county where the offender establishes or maintains a residence upon first entering the state for offenders described in subparagraph (a)3. The state attorney shall bring the matter to the court's attention in order to establish that the offender meets the sexual predator criteria. If the state attorney fails to establish that an offender meets the sexual predator criteria and the court does not make a written finding that the offender is a sexual predator, the offender is not required to register with the department as a sexual predator.
§ 775.21(5)(c) (emphasis added). However, this provision likewise is inapplicable on its face because subparagraph (a)1 pertains only to offenders who have been civilly committed under the Jimmy Ryce Act, § 394.910, Fla. Stat. (2000), and subparagraph (a)3 pertains to persons who have committed a similar violation in another jurisdiction. By its terms, this subsection does not include offenders described in section 775.21(a)2, the category in which Cuevas falls.
The language of the statute we are called upon to apply in this case is plain and unambiguous. Our task in this circumstance begins and ends with the application of the plain language. "[W]hen the language of the statute is clear and unambiguous and conveys a clear and definite meaning, there is no occasion for resorting to the rules of statutory interpretation and construction." See Holly v. Auld, 450 So. 2d 217, 219 (Fla.1984) (quoting A.R. Douglass, Inc. v. McRainey, 102 Fla. 1141, 137 So. 157, 159 (1931)). "[T]he legislative intent must be derived from the words used without involving incidental rules of construction or engaging in speculation as to what the judges might think that the legislators intended or should have intended." Tropical Coach Line, Inc. v. Carter, 121 So. 2d 779, 782 (Fla.1960). Thus, the statute's text is the most reliable and authoritative expression of the Legislature's intent. See V.K.E. v. State, 934 So. 2d 1276, 1286 (Fla.2006).
Moreover, there exists an articulable rationale for the statute as it appears. The Jimmy Ryce Act applies to "a small but extremely dangerous number of sexually violent predators." See § 394.910. The Legislature's desire to have registered sexual predators who commit crimes in other jurisdictions is plain. This rationale finds support in the 2004 amendments to the Sexual Predators Act. It was that year the Legislature redefined the (a)1 offenders subject to post-sentencing designation *295 as those falling under the Jimmy Ryce Act, and moved the Cuevas category of offenders, whose designation must be made at the time of sentencing, into subparagraph (a)(2) of the Sexual Predators Act. See § 775.21(5)(a)1, Fla. Stat. (2004). The amendment expressly deleted "offenders described in ... subparagraph (a)(2)" from the recapture portion of the statute. See S. Crim. Just. Comm. Rep. 2444-307, Reg. Sess. (Fla.2004). This was then and remains today the Cuevas category of offenders. See § 775.21(5)(a)2. It is not for us to judicially amend the Act. It may be that this unimpeachably obvious action of the State Legislature was improvident or unwise. However, we must apply the law we have, not the law we wish we had.
I would reverse the order on appeal.
NOTES
[1] § 775.21(5)(a)2, Fla. Stat. (2006).
[2] Section 775.21(4)(a) imposes a mandatory duty ("an offender shall be designated ...").
[3] In the case of Section 775.21(5)(a)1., a sexually violent predator under Section 775.21(4)(d), one of the three enumerated state offices must notify the state attorney who prosecuted the offense. In the case of Section (5)(a)3., a sexual predator who was convicted of a qualifying offense in another jurisdiction before establishing or maintaining a residence in a Florida county, notice is to be given to the state attorney of that new county. In the case of a person like Cuevas, indisputably qualified to be designated a sexual predator but not designated at sentencing as the Legislature directed, no special notifications or interjurisdictional rules are required, and Section 775.21(5)(c) then specifies (without limitation) that the "state attorney shall bring the matter to the court's attention in order to establish that the offender meets the sexual predator criteria."
[4] The State has at all timeshere and belowproceeded on the strength of the Florida Sexual Predators Act of 2006. The defendant has at all times acquiesced in the application of this iteration of the Act. Because there is no ex post facto consequence to the application of the 2006 version of the Act to the facts of this case, see Gonzalez v. State, 808 So. 2d 1265 (Fla. 3d DCA 2002), I accede to the parties' choice of governing statute in this analysis.
[5] Section 775.21(5)(a)2 reads in full as follows:
An offender who meets the sexual predator criteria described in paragraph (4)(a) who is before the court for sentencing for a current offense committed on or after October 1, 1993, is a sexual predator, and the sentencing court must make a written finding at the time of sentencing that the offender is a sexual predator, and the clerk of the court shall transmit a copy of the order containing the written finding to the department within 48 hours after the entry of the order ...
(emphasis added). This provision of the Act read the same in 2002, when Cuevas was sentenced, as it did in 2006, when he finally was declared a statutory sexual predator.
[6] A careful reading of the Act leaves one puzzled how an offender in Cuevas' position can be lawfully "registered" under the Florida Sexual Predators Act in the absence of an order declaring him a sexual predator within the meaning of the Act, unless, perhaps, the offender elects to voluntarily register himself. In seeming contradiction to section 775.21(4)(c) of the Act, section 775.21(5)(c) states, "The Department of Corrections, the department, or any other law enforcement agency shall not administratively designate an offender as a sexual predator without a written finding from the court that the offender is a sexual predator." (Emphasis added.) Furthermore, the provisions requiring self-registration appear to apply only to "an offender designated as a `sexual predator' under subsection (5)"i.e., an offender for whom a written order is in existence. See § 775.21(5)(a)3, Fla. Stat. (2006) (emphasis added); Reyes v. State, 854 So. 2d 816, 817 (Fla. 4th DCA 2003) ("A person who has been designated a sexual predator must register with the Department of Law Enforcement for the duration of his or her life."). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582668/ | 339 Mich. 62 (1954)
62 N.W.2d 626
CITY OF DETROIT
v.
WAYNE CIRCUIT JUDGES.
Calendar No. 46,054.
Supreme Court of Michigan.
Writs granted February 18, 1954.
Rehearing denied April 5, 1954.
Appeal dismissed October 14, 1954.
Paul T. Dwyer, Corporation Counsel, and Vance G. Ingalls, Helen W. Miller and Julius C. Pliskow, Assistants Corporation Counsel, for plaintiffs.
George E. Brand, and George E. Brand, Jr., for individual defendants.
Amici Curiae:
Automobile Club of Michigan, by Erickson, Dyll, Marentay. Van Alsburg & Slocum.
Downtown Property Association, Building Owners and Managers Association, Detroit Hotel Association, *65 Traffic Safety Association of Detroit, and Detroit Convention and Tourist Bureau, by Wilber M. Brucker, H. William Butler, and Clark, Klein, Brucker & Waples.
City of Ann Arbor, by William M. Laird, City Attorney, and Miller, Canfield, Paddock & Stone.
Appeal dismissed by the Supreme Court of the United States October 14, 1954.
BOYLES, J.
The city of Detroit files here a petition for writs of prohibition and mandamus, to prevent the circuit judges in Wayne county, and the plaintiffs in a certain chancery case now pending in their court, from taking any further steps or proceedings in said case. We issued an order to said defendants to show cause why the petition should not be granted. Responses have been filed, briefs filed by the parties and by amici curiae by leave of court, and oral arguments heard.
The bill of complaint in said case was filed December 15, 1953, by the Service Parking Grounds, a Michigan corporation, and 15 other owners or operators of privately-owned automobile parking lots in Detroit, to obtain a declaratory decree holding that proceeds from parking meters for on-street automobile parking in Detroit cannot be legally combined with those from city-owned off-street parking facilities for bond financing; that money collected from street parking meters cannot legally be used for off-street parking facilities; that Detroit ordinances 672-E and 804-E, which provide for acquiring off-street parking facilities and for issuing revenue bonds to finance the same, are invalid; and to declare that off-street parking facilities cannot be legally exempted from taxation. (This final question is premature and does not require consideration now. But see CL 1948, § 141.161 [Stat Ann 1949 Rev § 5.2426(1)].)
*66 The bill of complaint further asks that the city be enjoined from consummating the revenue bond financing for municipal off-street parking contemplated by the city, as provided for in said 2 city ordinances; from using money collected from street parking meters for municipal off-street parking facilities; and from using any surplus money from street parking meters to pay revenue bonds and interest.
No answer has been filed to said bill of complaint. On December 30, 1953, the city filed a motion to dismiss the case, which, however, has not been brought on for hearing. Instead, on December 31, 1953, the city filed in this Court the instant petition for a writ of prohibition to prevent further proceedings on said bill of complaint and for mandamus to require the circuit judges to dismiss the case. The controlling question is whether the bill of complaint sets up proper and sufficient grounds for the declaratory decree and the injunctive relief sought. The city claims that it has been filed purposely to delay the revenue bond financing.
Detroit is a home-rule city. By charter,[*] it has been authorized to acquire, establish, operate and maintain facilities for the parking of automobiles and to acquire the necessary land therefor. Such a provision in the city charter is authorized by the home-rule act, as follows:[]
"Each city may in its charter provide: * * *
"(6) For the acquiring, establishment, operation, extension and maintenance of facilities for the storage and parking of vehicles within its corporate limits, including the fixing and collection of charges for services and use thereof on a public utility basis, and for such purpose to acquire by gift, purchase, condemnation or otherwise the land necessary therefor."
*67 The city is also similarly authorized by the revenue bond act,[**] as follows:
"Any public corporation is authorized to * * * acquire * * * 1 or more public improvements and to own, operate and maintain the same, within and/or without its corporate limits, and to furnish the services, facilities and commodities of any such public improvement to users within and/or without its corporate limits: * * *
"(d) No commercial enterprise, other than the parking or storage of motor vehicles, shall be conducted or authorized at or upon any automobile parking facility authorized under the provisions of this act.
"The powers in this act granted may be exercised notwithstanding no bonds are issued hereunder."
In 1947 the city adopted ordinance 213-E creating a municipal parking authority, to have general supervision over all municipally-owned facilities for parking and storage of motor vehicles. In 1948 the city adopted ordinance 236-E amending a previous ordinance and providing that the coins collected from parking meters be deposited in a special parking-meter fund to be used for the cost of acquiring and installing parking meters, cost of supervision, inspection, maintenance, supply of parts, cost of collection, and enforcement of the ordinance. It further provided as follows:
"Any balance remaining after use of the funds as hereinbefore provided, shall be used, upon due appropriation by the common council, for the acquisition and installation of other traffic control devices and for the acquisition, construction and operation of off-street parking facilities."
In 1952 the city adopted ordinance 672-E. After reciting that the city was in urgent need of providing *68 accessible off-street parking facilities to relieve congestion, the ordinance provided for acquiring off-street parking facilities. It further provided that parking facilities, both on-street and off-street, should be operated as a single automobile parking system, and for issuing revenue bonds to pay the cost of acquiring and maintaining off-street parking facilities. In 1953, effective December 10th, the city adopted ordinance 804-E, amending ordinance 672-E above referred to. Essentially, it continued in effect the previous provisions authorizing the acquisition and operation of off-street parking facilities, the use of parking meter revenues and funds then or thereafter in the city treasury for those purposes, and the issuing of additional revenue bonds in the amount of $2,400,000 to pay for the cost of acquiring and making available for use the municipal off-street parking facilities therein referred to.
The plaintiffs, operators of privately-owned automobile parking lots, by their bill of complaint claim that the 2 city ordinances, 672-E and 804-E, above referred to, are invalid and that the city does not have the right to acquire, operate and maintain off-street automobile parking facilities or to issue revenue bonds for that purpose. Succinctly stated in their bill of complaint, the plaintiffs' claim is as follows:
"Under the circumstances, ordinances Nos 672-E and 804-E illegally bind the city of Detroit to subsidize each and every of said off-street facilities out of the excess money being or to be collected by the on-street parking meters and to pay the deficiencies in maintenance, operation and taxes of each of said facilities and to pay the principal of, and interest on, the revenue bonds out of said meter money, and to maintain said meters and such charges as may become necessary to meet said deficiencies for 30 years or until all bonds and interest shall be paid in full *69 regardless of the advisability of maintaining said meters upon the city streets and regardless of the expense of said regulation. * * *
"The city of Detroit has no right or power to acquire, own, maintain or operate off-street automobile parking facilities, either as contemplated by said ordinances or otherwise."
Plaintiffs' claims have been answered in the negative by several decisions of this Court where the same questions were involved.
Automobile parking meters are a "public improvement" within the meaning of the revenue bond act, although not a "public utility." Control of and revenue from street parking meters may be legally combined with municipally-owned-and-operated off-street parking facilities within said act, for the purpose of financing by the issuance of revenue bonds. Money collected from street parking meters may be used for off-street municipally-owned parking facilities. The expenditure of public funds to acquire and operate off-street parking facilities involves public safety and is lawful. Wayne Village President v. Wayne Village Clerk, 323 Mich. 592 (8 ALR2d 357). The minor variations between the instant situation and that in the Wayne Village Case, claimed by counsel for the plaintiffs, have no material bearing on the conclusions reached in that case.
Detroit city ordinances 672-E and 804-E, the legality of which is challenged by the plaintiffs in the chancery case, are copied from and are substantially the same as the ordinances considered by the Court in the Wayne Village Case, supra, and are substantially the same as the ordinances which were under like attack and held valid by this Court in Cleveland v. City of Detroit, 324 Mich. 527 (11 ALR2d 171). There is no merit in plaintiffs' present claim that the city cannot legally collect surplus or "profit" money from street parking meters, to be used to finance *70 off-street parking facilities. Wayne Village President v. Wayne Village Clerk, supra; Bowers v. City of Muskegon, 305 Mich. 676. The question whether or not the parking facilities will be operated at a profit is an administrative problem for the legislature and the municipal authorities. It is not a matter primarily to be decided by the courts.
In their bill of complaint the parking lot owners have set up at length the value and extent of their properties, their dependency on profitable operation of their parking facilities, and their loss or damage if the city is allowed to enter into competition with their business by off-street automobile parking. They ask that the city be enjoined from acquiring and operating off-street parking facilities because of those facts and circumstances. They claim that Detroit lacks authority to engage in a public improvement, such as automobile off-street parking, in competition with them, to their financial damage and loss. This Court has held to the contrary:
"In the exercise of proprietary and business powers of a municipal corporation, it is governed by the same rules which control a private individual or a business corporation: in such case the fact that a city engaging in a commercial line of activity competes with and damages one of its inhabitants in his trade or business does not entitle him to relief against municipal action for the city owes him no immunity from competition." Andrews v. City of South Haven (syllabus), 187 Mich. 294 (LRA1916A, 908, Ann Cas 1918B, 100).
The proviso in the revenue bond act hereinbefore quoted indicates that off-street parking is considered as a "commercial enterprise" which a municipality is authorized to acquire. In authorizing parking "without the corporate limits," it contemplates off-street parking. A municipality does not have city streets outside the corporate limits.
*71 Counsel for the city claim that the writ of prohibition should issue because of the lack of proper parties plaintiff, seeking relief as taxpayers. Assuming that the plaintiffs by their bill of complaint are seeking injunctive relief against the city, as taxpayers, counsel for the city argue that the plaintiffs should be prohibited from maintaining their bill of complaint because, as taxpayers, they have no standing in court. Were this the only question involved, we would agree to granting the writ to compel dismissal of the bill of complaint on that ground, having recently so held in Menendez v. City of Detroit, 337 Mich. 476, and Nichols v. State Administrative Board, 338 Mich. 617.
However, it should be noted that the plaintiffs, in their bill of complaint, ask for a declaratory decree, to settle controlling questions of law; and counsel for the city likewise ask that we decide the merits of the questions raised here in order to have an early decision, because of the need for prompt relief of congested traffic and parking conditions in Detroit and to avoid any further delay in the issuance of revenue bonds. With that in mind, instead of taking a short cut by deciding the matter on the ground that the plaintiffs have no standing in court, we have concluded to follow the method recently adopted in the Nichols Case, supra, and decide the merits of the questions raised.
The writs of prohibition and mandamus will issue. No costs, a public question being involved.
BUTZEL, C.J., and CARR, BUSHNELL, SHARPE, REID, DETHMERS, and KELLY, JJ., concurred.
NOTES
[*] Detroit charter, title 3, ch 1, § 12(v).
[] CL 1948, § 117.4h (Stat Ann 1949 Rev § 5.2081).
[**] PA 1933, No 94, as last amended by PA 1947, No 204 (CL 1948, § 141.104 [Stat Ann 1949 Rev § 5.2734]). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582737/ | 976 F. Supp. 383 (1997)
Joann HALL, Plaintiff,
v.
STORMONT TRICE CORPORATION, d/b/a Norfolk Marriott Hotel, Defendant.
No. 2:97 cv178.
United States District Court, E.D. Virginia, Norfolk Division.
September 11, 1997.
*384 Scott Meadows Reed, Scott M. Reed, P.C., Virginia Beach, VA, for Plaintiff.
Lisa Ann Bertini, Robert William McFarland, McGuire, Woods, Battle & Boothe, Norfolk, VA, for Defendant.
OPINION AND ORDER
MORGAN, District Judge.
This matter is before the Court on Defendants' Motions for Summary Judgment pursuant to Fed.R.Civ.P. 56, filed June 9, 1997. A hearing was conducted and the Court ruled from the bench on this matter on Tuesday, August 19, 1997. This opinion will further explain the rationale for the Court's ruling.
FACTS
Plaintiff Joann Hall ("Hall") was the employee of Norfolk's Waterside Marriott ("Marriott") from October 7, 1991 to December 20, 1994 as a Banquet Captain. Hall alleges that her termination was the result of racial discrimination in violation of Title VII of the Civil Rights Act of 1964 and 42 U.S.C. § 1981a. Defendant denies that the alleged discrimination took place.
On December 3, 1993, Hall alleges she was disciplined and on April 23, 1994, Hall alleges she was subject to unequal terms and conditions of employment based on inadequate staffing. As a result of each of these two incidents, she complained to the NAACP. On June, 6, 1994, June 13, 1994, and June 23, 1994, Hall allegedly was harassed in the form of disrespectful and confrontational treatment by management that impaired her ability to perform her employment responsibilities. All of the above incidents were the subject of an EEOC Complaint filed July 1, 1994.
On December 20, 1994, Hall was discharged from employment with Marriott. Hall filed another EEOC Complaint, dated December 20, 1994, alleging her discharge arose from unlawful discrimination. Hall filed a third EEOC Complaint in 1995 alleging that she was unlawfully denied a promotion to the position of Assistant Banquet Manager sometime before May 15, 1994.
Hall filed a complaint on February 14, 1997. The Complaint alleges four counts asserted against Marriott. Count 1 alleges Marriott management, supervisory employees and agents unlawfully discriminated against Hall during the entirety of her employment based on her race in violation of Title VII. Count two alleges unlawful racial discrimination from April 25, 1994 (the date of her NAACP Complaint) through June 25, 1994 based on the three episodes of harassment occurring in June, 1994 in violation of Title VII. Count three alleges unlawful discrimination based on the denial of Hall's promotion to Assistant Banquet Manager in violation of Title VII. Count four alleges retaliatory termination of Hall's employment based on the filing of the July 1, 1994 EEOC Complaint. Hall seeks recovery of back pay, front pay and compensatory damages for emotional pain, suffering, inconvenience, mental anguish and loss of enjoyment of life, attorneys' fees and other appropriate relief. No punitive damages were mentioned or sought. Hall is suing for $300,000 per count for a total of $1.2 million. Hall has demanded a jury trial in this matter.
In her Brief in Opposition to Defendant's Motion for Summary Judgment, Plaintiff stipulated to the fact that Defendant has more than 200 and fewer than 501 employees in each of 20 or more calendar weeks in the current or preceding calendar year.
Summary of Arguments
Hall stipulated to Defendant having between 201 and 500 employees. Defendant asserts that the statutory cap in 42 U.S.C. § 1981a(b)(3)(C) applies to the combination of all counts brought by a single plaintiff. Defendant further argues that it would be ineffective to apply the statutory cap to all punitive and compensatory damages awarded in a suit and then allow separate counts to warrant separate statutory caps. Defendant argues that Congress placed a general statutory *385 cap and applied it to both compensatory and punitive damages in order to limit the recovery received by an aggrieved plaintiff and to advise employers of the extent of their potential liability.
Plaintiff argues, however, that the statutory cap contained within § 1981 a only limits her damages to $200,000 for each of her four counts meaning a potential recovery of $800,000. Plaintiff claims she joined her four claims, under Fed. R. Civ P. 18(a), for the Court's convenience.[1] The Plaintiff argues that an action taken by the Plaintiff for the Court's benefit should not thereby limit her recovery to a total of $200,000 as opposed to $800,000.
Standard of Review
District courts may enter summary judgment only when there is no genuine issue of material fact and the movant is entitled to judgment as a matter of law. See Miller v. Leathers, 913 F.2d 1085, 1087 (4th Cir.1990) (en banc) cert. den., 498 U.S. 1109, 111 S. Ct. 1018, 112 L. Ed. 2d 1100 (1991). The facts and inferences to be drawn from the pleadings must be viewed in the light most favorable to the nonmoving party. See Nguyen v. CNA Corp., 44 F.3d 234, 237 (4th Cir.1995). Summary judgment is appropriate when the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-49, 106 S. Ct. 2505, 2509-11, 91 L. Ed. 2d 202 (1986).
Analysis
The issue presented in this case is whether the statutory cap imposed in 42 U.S.C. § 1981a(b)(3) is applied to the total recovery of the plaintiff or whether a separate recovery is available for each Title VII count presented. This issue seems to be one of first impression for the Court.
42 U.S.C. § 1981a(b)(3) reads:
(b) Compensatory and punitive damages
(1) Determination of punitive damages. A complaining party may recover punitive damages under this section against a respondent (other than a government, government agency or political subdivision) if the complaining party demonstrates that the respondent engaged in a discriminatory practice or discriminatory practices with malice or with reckless indifference to the federally protected rights of an aggrieved individual....
(3) Limitations. The sum of the amount of compensatory damages awarded under this section for future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, loss of enjoyment of life, and other nonpecuniary losses, and the amount of punitive damages awarded under this section, shall not exceed, for each complaining party
(c) in the case of a respondent who has more than 200 and fewer than 501 employees in each of 20 or more calendar weeks in the current or preceding calendar year, $200,000....
(emphasis added). The statute applies the statutory cap to the damages of "each complaining party." Id. If the statute had spoken of a cap for each complaint, issue or count, the Court may have interpreted the statute differently. Instead, the statute, by referring to "each complaining party," leads the Court to conclude that the Plaintiff's damages are limited to $200,000.
The precedents available on this issue include Beam v. Concord Hospitality, Inc., 1996 WL 455020 (D.Kan.1996) and Haltek v. Village of Park Forest, 864 F. Supp. 802 (N.D.Ill.1994). In Beam, the plaintiff alleged several counts including two federal discrimination claims under Title VII. See 1996 WL 455020 at *1. The U.S. District Court of Kansas did not directly address the issue of whether a single statutory cap applied to each of the Title VII discrimination claims. See id. at *6. The court did say that the statutory cap should be applied after the jury returns a verdict in excess of the statutory cap, implying that the cap applies to all counts as determined by the jury. See id. The court in Haltek, when faced with numerous Title VII claims, assumed that the statutory cap applied to all of plaintiff's claims together, but refrained from applying the cap until after a jury verdict was reached. See *386 864 F.Supp. at 807. Am. Jur. further supports this statutory reading. See 45C Am. Jur. Job Discrimination § 3000 (1993) ("The damage caps apply to each aggrieved individual, whether or not a respondent is subject to multiple damage awards...."). This interpretation is consistent with section 1981a(b)(1) which entitles a complaining party to punitive damages for "a discriminatory practice or discriminatory practices...." This language suggests that one punitive award within the statutory cap is available for multiple discriminatory practices. There is no language in the statute to suggest that a single cap would be applied to punitive damages and a different treatment accorded those forms of compensatory damages outlined in the statute.
An analogous question that has been decided by numerous courts is whether the statute applies the cap to the request for all compensatory as well as punitive damages. Recent federal court decisions have supported the reading that a plaintiff requesting both compensatory and punitive damages is entitled to a total award of $200,000 under similar facts as this. See Hogan v. Bangor and Aroostook Railroad Co., 61 F.3d 1034, 1037 (1st Cir. 1995) ("The statute is clear on its face that the sum of compensatory damages (including its various components) and punitive damages shall not exceed $200,000."); Solomon v. Godwin and Carlton, P.C., 898 F. Supp. 415, 415-16 (N.D.Tex.1995) ("The court holds that the cap imposes a single limitation on both types of damages, so that the total of compensatory and punitive damages awarded may not exceed the applicable cap amount."). It seems illogical to conclude that Congress intended to limit the amount of punitive and compensatory damages recovered, but also intended to allow separate recoveries on each count pleaded.
Based upon this reasoning, the statutory cap should apply to the total sum awarded to the Plaintiff. Plaintiff should not be able to recover additional damages because she or her attorney were able to envision multiple legal theories upon which to base her discrimination complaint. If the Plaintiff is permitted to allege multiple counts, each based on a different legal theory as a means of evading the statutory cap imposed by Congress, the purpose of the cap is thwarted. Therefore, Marriott is entitled to have a single statutory cap apply to the sum of the Plaintiff's claims.
Because this Court will not inform the jury of the damage cap, see Beam, 1996 WL 455020 at *5; Haltek, 864 F.Supp. at 807, the amount that can be requested from the jury will not be limited.[2] Therefore, Defendant's Motion for Summary Judgment in regard to the application of the statutory cap to the total sum of damages awarded to the Plaintiff including compensatory as well as punitive is GRANTED. However, the statutory cap will not be imposed unless and until the jury returns a verdict for greater than the statutory limit.
The Clerk is REQUESTED to send copies of this order to all counsel of record.
It is so ORDERED.
NOTES
[1] Defendant responds that the Court would most likely have ordered a joint trial for all these matters pursuant to Fed. R. Civ. P 42(a) if the counts had been brought as separate actions.
[2] The parties are cautioned that, where the damages are unliquidated, this Court does not ordinarily permit any party to mention to the jury the amount of damages sought. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582692/ | 976 F. Supp. 1431 (1997)
Johnny REYNOLDS, et al., Plaintiffs,
v.
ALABAMA DEPARTMENT OF TRANSPORTATION, et al., Defendants.
UNITED STATES of America, Plaintiff,
v.
Halycon Vance BALLARD, et al., Defendants,
Alabama State Conference of NAACP Branches, Amicus Curiae.
Civil Action Nos. 85-T-665-N, 2709-N.
United States District Court, M.D. Alabama, Northern Division.
September 10, 1997.
*1432 Laurie Edelstein, Special Master, Rabinowitz, Boudin, Standard, Krinsky & Lienerman, P.C., New York City, pro se.
Winn S.L. Faulk, Special Master, Mobile, AL, pro se.
Leonard Gilbert Kendrick, Montgomery, AL, Richard J. Ebbinghouse, Robert L. Wiggins, Jr., Jon C. Goldfarb, Gregory O. Wiggins, C. Paige Williams, Rebecca Anthony, Gordon, Silberman, Wiggins & Childs, Birmingham, AL, Julian L. McPhillips, Jr., McPhillips, Shinbaum, Gill & Stoner, Montgomery, AL, Rick Harris, Glassroth & Associates, Montgomery, AL, for Johnny Reynolds, Cecil Parker, Frank Reed, Ouida Maxwell, Martha Ann Boleware, Peggy Vonsherie Allen, Jeffrey W. Brown.
Leonard Gilbert Kendrick, Montgomery, AL, Richard J. Ebbinghouse, Robert L. Wiggins, Jr., Jon C. Goldfarb, Gregory O. Wiggins, C. Paige Williams, Rebecca Anthony, Gordon, Silberman, Wiggins & Childs, Birmingham, AL, Claudia H. Pearson, Longshore, Nakamura & Quinn, Birmingham, AL, Julian L. McPhillips, Jr., McPhillips, Shinbaum, Gill & Stoner, Montgomery, AL, Rick Harris, Glassroth & Associates, Montgomery, AL, for Robert Johnson.
Florence Belser, Montgomery, AL, pro se.
Raymond P. Fitzpatrick, Jr., David P. Whiteside, Jr., Whiteside & Fitzpatrick, Birmingham, AL, for William Adams, Cheryl Caine, Tim Colquitt, William Flowers, Wilson Folmar, George Kyser, Becky Pollard, Ronnie Pouncey, Terry Robinson, Tim Williams.
William K. Thomas, R. Taylor Abbot, Jr., Cabaniss, Johnston, Gardner, Dumas & O'Neal, Birmingham, AL, Jeff Sessions, Attorney General, Office of the Attorney General, Montgomery, AL, Patrick H. Sims, Cabaniss, Johnston, Gardner, Dumas & O'Neal, Mobile AL, for Gary Mack Roberts.
Bert S. Nettles, Lisa Wright Borden, London, Yancey, Elliott & Burgess, Birmingham, AL, William F. Gardner, William K. Thomas, R. Taylor Abbot, Jr., Cabaniss, Johnston, Gardner Dumas & O'Neal, Birmingham, AL, Jeff Sessions, Attorney General, Office of the Attorney General, Montgomery, AL, Patrick H. Sims, Cabaniss, Johnston, Gardner, Dumas & O'Neal, Mobile, AL, for Halycon Vance Ballard, Department of Personnel, State of Alabama.
Bert S. Nettles, Lisa Wright Borden, London, Yancey, Elliott & Burgess, Birmingham, AL, William F. Gardner, William K. Thomas, *1433 R. Taylor Abbot, Jr., Cabaniss, Johnston, Gardner Dumas & O'Neal, Birmingham, AL, Jeff Sessions, Attorney General, Office of the Attorney General, Montgomery, AL, Jack Franklin Norton, Alabama Department of Transportation, Legal Division, Montgomery, AL, Patrick H. Sims, Cabaniss, Johnston, Gardner, Dumas & O'Neal, Mobile, AL, for Department of Transportation, State of Alabama.
William F. Gardner, William K. Thomas, R. Taylor Abbot, Jr., Cabaniss, Johnston, Gardner Dumas & O'Neal, Birmingham, AL, Jeff Sessions, Attorney General, Office of the Attorney General, Montgomery, AL, Patrick H. Sims, Cabaniss, Johnston, Gardner, Dumas & O'Neal, Mobile, AL, for James E. Folsom, Jr.
ORDER
MYRON H. THOMPSON, Chief Judge.
These two race-discrimination lawsuits are now before the court on a motion to stay filed in Reynolds v. Alabama Department of Transportation, civil action no. 85-T-665-N, on September 4, 1997, by defendants Alabama Department of Transportation, Alabama State Personnel Department and several State officials.[1] The issue presented is whether, as defendants contend, the impending resumption of trial, now set for September 15, 1997, should be stayed pending this court's resolution of their motion, filed on August 27, 1997, to dismiss plaintiffs' disparate-impact claims.[2] In their dismissal motion, defendants contend that, in providing for the imposition of disparate-impact liability on the States and their officials under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C.A. § 1981a, 2000e through 2000e-17, the United States Congress exceeded its authority under the eleventh and fourteenth amendments to the United States Constitution. For the reasons that follow, the court concludes based principally on three cases, one from the First Circuit Court of Appeals, another from the Sixth Circuit Court of Appeals, and another from the Seventh Circuit Court of Appeals that the eleventh-hour stay motion should be denied as untimely.
I. BACKGROUND
To put the defendants' stay and dismissal motions in their proper context and, in particular, to show just how belated they are it is necessary to review the relevant and salient aspects of the 12-year history of the Reynolds litigation that preceded the filing of the motions with the court:
May 1985: Reynolds was filed.[3] The plaintiffs charged the defendants with employment discrimination based on race in the Alabama Department of Transportation. The plaintiffs are African-Americans, and they represent a class of African-American merit and non-merit system employees and unsuccessful applicants. The defendants include the Transportation Department, the Personnel Department, and several State officials. The plaintiffs base this lawsuit on the following: Title VII of the Civil Rights Act of 1964, as amended, codified at 42 U.S.C.A. §§ 1981a, 2000e through 2000e-17; the fourteenth amendment to the United States Constitution, as enforced by 42 U.S.C.A. § 1983; and 42 U.S.C.A. § 1981. The jurisdiction of the court has been invoked pursuant to 28 U.S.C.A. § 1343 and 42 U.S.C.A. § 2000e-5(f)(3).
1985: Answers filed over a period of time by defendants.[4]
October 8, 1986: The court entered an order certifying a plaintiff class as follows: (1) all black merit system employees employed by the Transportation Department at any time since May 21, 1979; (2) all black non-merit system employees of the department *1434 who have unsuccessfully sought employment as merit system employees with the department at any time since May 21, 1979; and (3) all black non-employees who have unsuccessfully sought employment as merit system employees with the department at any time since May 21, 1979.[5] Subclasses (1) and (2) therefore consist of employees of the department and subclass (3) consists of non-employees.
October 23, 1986: First pretrial hearing held.
October 31, 1986: First pretrial order entered, and case set for trial on March 3, 1987.[6]
February 18, 1987: Order entered continuing the trial setting until June 8, 1987.[7]
May 8, 1987: Court informed that case is settled, and trial is continued generally.[8]
September 21, 1987: Case did not settle, and an order was entered resetting trial for February 29, 1988.[9]
October 16, 1987: Second pretrial conference held.
November 5, 1987: Second pretrial order entered, again stating that trial is set for February 29, 1988.[10]
January 5, 1988: Order entered continuing the trial setting until March 7, 1988.[11]
January 21, 1988: Order entered continuing the trial setting until June 13, 1988.[12]
May 20, 1988: Order entered continuing the trial setting until June 20, 1988.[13]
1988: The parties again reached full settlement of this case, and an order was entered on June 20, 1988, continuing trial in general,[14] but the court refused to approve the proposed consent decree in the face of numerous objections from the members of the plaintiff class. Reynolds v. King, 790 F. Supp. 1101 (M.D.Ala.1990).
January 29, 1991: Revised proposed settlement presented to court, and court provisionally approved it.[15]
March 20, 1991: Defendants exercised option to cancel revised proposed settlement.[16]
April 10, 1991: Order entered setting trial for September 16, 1991.[17]
July 30, 1991: Order entered setting trial for November 4, 1991.[18]
October 4, 1991: Third pretrial hearing held.
October 7, 1991: Third pretrial order entered,[19] and trial reset for January 2, 1992.[20]
December 23, 1991: Order entered continuing the trial setting until June 15, 1992,[21] on which date the trial began.
1992: The trial extended over several months, but ended before completion when the parties announced that they might be able to settle the litigation again.
1993 and 1994: The parties reached a second, albeit only partial, settlement, subsequently *1435 embodied in three consent decrees. In the wake of this new settlement, the court allowed a group of non-class members consisting mostly of white employees of the Department of Transportation and now commonly referred to as the "Adams intervenors" to intervene and challenge any race-conscious provisions in the settlement. Reynolds v. Roberts, 846 F. Supp. 948 (M.D.Ala.1994).
March 16, 1994: The court approved one of the consent decrees, now known as consent decree I.[22] Consent decree I reaffirmed the certification of a plaintiff class, with sub-classes, as set forth in the order of October 8, 1986. Most importantly, it provided for extensive and detailed class-wide relief. The two other proposed consent decrees are currently under the court's consideration.
One of the provisions of consent decree I, article XX, governed how the parties were to proceed in dealing with claims of individual class members. The article provided that, if further negotiations were unsuccessful, the trial was to recommence within 120 days of March 16 as to the "claims for monetary and non-monetary remedies for individual members of the class." The article states as follows:
"ARTICLE TWENTY
FURTHER PROCEEDINGS REGARDING CLASS MEMBERS
1. Further negotiations and proceedings are required to resolve the claims for monetary and non-monetary remedies for individual members of the class (including the named plaintiffs and intervenors), provided however, that this Decree does not in and of itself entitle any such class member to such remedies. Such claims shall be resolved first by settlement negotiations and then, to the extent not resolved by settlement negotiations, by the Court.
2. The parties will make all reasonable efforts to resolve all such claims of the members of the class (including the named plaintiffs and intervenors) according to a schedule to be mutually agreed upon within 10 days after preliminary approval of this Decree by the Court or, in the event the parties cannot mutually agree on such schedule within such 10 day period, the Court will enter an Order embodying a schedule. Regardless of whether the schedule is mutually agreed upon by the parties or embodied in an Order entered by the Court, such schedule shall contain specific deadlines for the exchange of information and for offers and counter-offers to enable settlement negotiations on such claims to take place within 90 days after the effective date of this Consent Decree and, in the event such settlement cannot be achieved, for trial on that phase of the case to commence no later than 180 days after the effective date of this Decree.
3. Such schedule shall be presented to the Court for approval or modification, and once finalized shall be entered as an Order of the Court. In the absence of agreement on such schedule within 10 days of the preliminary approval of this Decree, the Court will enter its own schedule aimed at settlement negotiations taking place within 90 days after the effective date of this Decree and scheduling that phase of the trial of this case to commence no later than 180 days after the effective date of this Decree."
August 28, 1995: The parties entered into a global settlement of the monetary claims of many of the class members.[23] The non-monetary claims remained unresolved.
1995, 1996, and 1997: The parties litigated numerous aspects of the August 28, 1995, settlement for monetary relief. See, e.g., Reynolds v. Alabama Department of Transportation, 955 F. Supp. 1428 (M.D.Ala.1997); Reynolds v. Alabama Department of Transportation, 926 F. Supp. 1077 (M.D.Ala.1996). *1436 This litigation resulted in an order,[24] which is now on appeal. In tandem with this litigation, the parties also litigated defendants' extensive failure to comply with various substantive provisions such as training, recruitment, and setting up promotion and hiring procedures in the decree. See, e.g., Reynolds v. Alabama Department of Transportation, 972 F. Supp. 566, (M.D.Ala.1997); Reynolds v. Alabama Department of Transportation, 955 F. Supp. 1441 (M.D.Ala.1997); Reynolds v. Alabama Department of Transportation, 1996 WL 420834 (M.D.Ala. April 23, 1996). This aspect of the litigation has also resulted in an order, which is now on appeal.[25]
August 2, 1995: In anticipation of the resumption of trial (although not within the 120 days required by the consent decree and thus belatedly), defendants filed Rule 52 motions for judgment as a matter of law on the individual claims remaining from the 1992 trial but for which trial would now have to resume.[26]
September 7, 1995: Order entered setting trial for May 13, 1996.[27]
September 26, 1995: Order entered denying Rule 52 motions.[28]
April 23, 1996: Order entered setting trial to resume on May 13, 1996.[29]
May 2, 1996: Order entered continuing the trial setting until June 3, 1996.[30]
May 24, 1996: Order entered continuing the trial setting until August 19, 1996.[31]
August 27, 1996: Order entered continuing the trial setting until December 9, 1996.[32]
November 8, 1996: Fourth pretrial conference held.
November 19, 1996: Fourth pretrial order entered, restating case is set for trial on December 9, 1996.[33]
December 9, 1996: Order entered continuing the trial setting until December 18, 1996.[34]
December 20, 1996: Order entered continuing trial to a date to set later.[35]
March 26, 1997: Order entered continuing the trial setting until July 2, 1997.[36]
April 15, 1997: Defendants filed a motion asking to amend their answer to assert for the first time, after 12 years of litigation, an eleventh-amendment defense.[37]
May 19, 1997: Defendants filed a motion asking for clarification of burden of proof in their favor or for continuance of upcoming trial.[38]
May 21, 1997: Over the vigorous objection of plaintiffs, an order was entered granting the defendants permission to amend their answer,[39] and the defendants filed an amendment to their answer asserting eleventh amendment immunity from liability under any theory of discrimination that does not *1437 require proof of intentional deprivation of rights, including disparate-impact claims.[40]
June 25, 1997: Order entered continuing the trial setting to the current trial date, September 15, 1997.[41]
August 27, 1997: Less than 20 days before trial, defendants filed a motion to dismiss disparate-impact claims asserting that they are immune from liability under any theory of discrimination that does not require proof of intentional deprivation of rights, and that Congress's attempt to impose such liability on States is an invalid exercise of its power under the fourteenth amendment.[42]
September 2, 1997: The Adams intervenors filed a motion to dismiss disparate-impact claims,[43] which incorporated by reference the arguments made in defendants' August 27, 1997, motion.[44]
September 3, 1997: During a telephone conference between the court, parties, and the United States, defense counsel indicated that they needed 30 days to brief the dismissal motion and thus could not brief it before trial. They indicated that they would file a motion to stay the trial. The court ordered an expedited filing of any stay motion because of the impending trial.
September 4, 1997: The defendants filed their motion for stay of trial proceedings[45] and memorandum in support of motion for stay.[46]
September 4, 1997: Order entered setting dismissal motion for submission on October 21, 1997, with defendants to file their brief by September 30, 1997, as they requested, and plaintiffs to do the same by October 21, 1997.[47]
II. DISCUSSION
It is apparent from this extended history (four pretrial hearings, a partial trial lasting several months, a partial but extensive settlement, numerous continuances of the resumption of trial, and extensive litigation over related issues) that defendants' dismissal and stay motions (which come only days before trial resumes and thus, by their own admission, were filed too late even to be briefed by them (let alone by the other parties) and resolved before trial resumes) are not just belated, they are grossly so. However, this conclusion, while compelling, is not dispositive of the issue before the court: whether the upcoming proceeding, now set for September 15, 1997, should be stayed pending resolution of the immunity question. For, "[T]he Eleventh Amendment bars a citizen from bringing suit against the citizen's own State in federal court." Welch v. State Dep't of Highways and Pub. Transp., 483 U.S. 468, 472, 107 S. Ct. 2941, 2945, 97 L. Ed. 2d 389 (1987). This principle holds true except where a State waives its immunity from suit, an act that requires express language by the State or overwhelming implication from its actions, or where the State's immunity is abrogated by Congress under its power granted in § 5 of the fourteenth amendment to the United States Constitution. Id. at 473-744, 107 S.Ct. at 2946. By their motion to dismiss disparate-impact claims, defendants are attempting to reclaim this shield in an area where it was previously thought to have been abrogated by Congress. Their motion is a direct challenge to Congress's creation of disparate-impact in Title VII, claiming that Congress exceeded its power under the fourteenth amendment when it extended the Act's coverage to include holding States liable for discrimination that does not require proof of intent, an argument that is, to the best of the court's knowledge, novel.
The question before this court is how to pay appropriate homage to this important *1438 constitutional defense, while at the same time allowing for the orderly and expeditious progress of cases to trial, something in which not only the litigants, but also the public, has an interest. At least three Courts of Appeals have expressly addressed this concern.
A.
In Kennedy v. City of Cleveland, 797 F.2d 297 (1986), cert. denied, 479 U.S. 1103, 107 S. Ct. 1334, 94 L. Ed. 2d 185 (1987), the Sixth Circuit Court of Appeals was confronted with a belated assertion of immunity not to go to trial. The court succinctly summarized the governing principle: "The quid pro quo is obvious: in exchange for the defendant's right to interrupt judicial process, the court may expect a reasonable modicum of diligence in the exercise of that right." 797 F.2d at 301. In reaching this conclusion, the court reasoned as follows.
The court acknowledged that eleventh-amendment immunity, as with all types of immunity, is multi-faceted. "[A]bsolute ... immunity, once established, not only protects the holder against ultimate personal liability in damages but also from the onerous burdens of defense in much the same way that the Double Jeopardy Clause and the Speech and Debate Clause afford immunity from prosecution." Id. at 298; see also Puerto Rico Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 145, 113 S. Ct. 684, 688, 121 L. Ed. 2d 605 (1993) ("[V]alue to the States of their Eleventh Amendment immunity, like the benefit conferred by qualified immunity to individual officials, is for the most part lost as litigation proceeds past motion practice."). Thus, eleventh-amendment immunity has at least two facets: immunity from liability and immunity from going to trial at all. Here, in the two cases now before this court, the latter immunity from trial is the basis on which the defendants rest their motion for a stay. They contend that they will effectively lose their eleventh-amendment immunity if they are forced to go to trial.
The Sixth Circuit added, however, that eleventh-amendment immunity was not jurisdictional, but rather could be waived if not timely asserted. The court explained: "[N]either absolute nor qualified immunity is recognized so much as a matter of inherent right in the person claiming it as it is the result of the application of historical principles which reflect a proper balance between the protection of the rights of individuals to be free from constitutionally violative harm and the very real need of persons charged with governmental duties to get on with its business without harassment or intimidation. [The] immunity, whether qualified or absolute, is an affirmative defense which must be affirmatively pleaded; it is not a doctrine of jurisdictional nature that deprives a court of the power to adjudicate a claim." Kennedy, 797 F.2d at 300 (citing Mitchell v. Forsyth, 472 U.S. 511, 527-28, 105 S. Ct. 2806, 2816, 86 L. Ed. 2d 411 (1985); Gomez v. Toledo, 446 U.S. 635, 640-41, 100 S. Ct. 1920, 1923-24, 64 L. Ed. 2d 572 (1980); Harlow v. Fitzgerald, 457 U.S. 800, 815 n. 24, 102 S. Ct. 2727, 2736 n. 24, 73 L. Ed. 2d 396 (1982)). "Since immunity must be affirmatively pleaded, it follows that failure to do so can work a waiver of the defense." Id.[48]
The court then clarified that because eleventh-amendment immunity has at least two *1439 aspects the right to be shielded from damages and the right not to go to trial "the interests are procedurally distinct," such that "the failure to plead immunity may, at different stages of the litigation, work either a partial or complete waiver." Id. "Hence, ... it is possible that one might assert immunity as an affirmative defense to the complaint and thus as an affirmative defense to ultimate liability without putting in issue his or her right to be free of subjection to trial or, before that, to the burdens of discovery." Id. Therefore, the court concluded that trial immunity "is one which can be lost by failure timely to assert it," and, in particular, can be subjected to the authority of a trial judge "to maintain control of his docket and to assure the expeditious advancement of cases." Id.
Because of these potentially conflicting concerns the right to assert immunity not to go to trial at all and the authority of the trial court to manage a case the appellate court then emphasized the need for the early and expeditious resolution of immunity issues. Id. at 299; see also Puerto Rico Aqueduct & Sewer Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 144, 113 S. Ct. 684, 687, 121 L. Ed. 2d 605 (1993). It is not only disruptive to the orderly preparation of a case for trial, it can be a tremendous waste of private and public resources for a defendant to allow opposing parties and the court to go through time-consuming and expensive trial preparations, only to assert at the last minute a right not to go trial at all. The least a defendant asserting the defense owes to everyone else is an early presentation of the trial-immunity defense.
Applying the above principle "a reasonable modicum of diligence in the exercise of [trial-immunity] right," Kennedy at 301 the Sixth Circuit then concluded, after an extensive review of the proceedings in the trial court (similar to one this court has made of the Reynolds litigation), that the defendants' abusive delay waived their immunity from trial, though not their immunity from liability. Id. at 301-06.
B.
In Apostol v. Gallion, 870 F.2d 1335 (1989), the Seventh Circuit Court of Appeals wrestled with the same tension between the importance of resolving an immunity claim early on and the trial court's power to proceed with its resolution of the case. There, the defense was one of qualified immunity, and the posture of the case was slightly different in that the parties had already received a ruling on their qualified-immunity defense and were seeking a stay pending appeal. Nevertheless, the Seventh Circuit was confronted, as is this trial court, with a concern that the defense was being raised belatedly. The court, speaking through Judge Easterbrook, cautioned trial courts that, "Defendants may seek to stall because they gain from delay at plaintiffs' expense, an incentive yielding unjustified appeals. Defendants may take [automatic interlocutory appeals taken from denial of claims of qualified immunity] for tactical as well as strategic reasons: disappointed by the denial of a continuance, they may help themselves to a postponement by lodging a notice of appeal. Proceedings masquerading as [automatic interlocutory appeals taken from denial of claims of qualified immunity] but in fact not presenting genuine claims of immunity create still further problems." 870 F.2d at 1338-39. The court observed that such shenanigans "may injure the legitimate interests of other litigants and the judicial system." Id. at 1338.
Confronted with such, the appellate court continued, trial courts "are not helpless in the face of manipulation." Id. at 1339. "If [defendants] wait too long after the denial of summary judgment, or if they use claims of immunity in a manipulative fashion, they surrender any entitlement to obtain an appellate decision before trial. This is not to say that they lose the right to contend on appeal from the final judgment that they enjoy immunity from damages; the right not to pay damages and the right to avoid trial are distinct aspects of immunity, and the former may be raised on appeal at the end of the case even if defendants bypass their right to appeal ... before trial." Id. In other words, "defendants who play games with the district court's schedule forfeit their entitlement to a *1440 pre-trial appeal. A district court may certify that a defendant has surrendered the entitlement to a pre-trial appeal and proceed with trial." Id.
C.
Finally, in Guzman-Rivera v. Rivera-Cruz, 98 F.3d 664 (1996), the First Circuit confronted an untimely trial immunity defense. As in the Reynolds case, the defendant there waited far into the litigation, even after the pretrial order, to assert the defense. Although the defense at issue was for qualified immunity, the court's observations are still applicable. The court wrote: "[D]efendants raised the qualified immunity defense very late in the pre-trial, post-discovery phase, despite the fact that they had ample opportunity to have the issue resolved expeditiously earlier in the proceedings, rather than generating additional delay by filing this third motion for summary judgment." 98 F.3d at 668. The court then defined the issue as "whether the defendants waived the right to raise the defense at this stage by failing to do so in a diligent manner and by failing to offer an explanation for the delay." Id. The court then concluded that, "[T]he defense of qualified immunity [has] been waived for the current stage of the litigation: the defense has been available to defendants since early in the litigation and, as the district court correctly found, the plaintiff has been prejudiced by the defendants' intentional strategy of delay."[49]
D.
Here, with regard to the upcoming resumption of trial on September 15, it is not even a close call that defendants have failed to exercise "a reasonable modicum of diligence in the exercise of [trial immunity]," Kennedy, 797 F.2d at 301, and thus have forfeited their right to trial immunity. For the following reasons, their failure far exceeds the circumstances presented in even Kennedy and other cases where a waiver has been found:
Defendants filed their initial answers in 1985. But not until twelve years later did they seek to amend their answer to assert the eleventh-amendment immunity defense they now seek to assert.
Four pretrial hearings have been held, and four pretrial orders entered. But at none of these hearings and in none of these orders did defendants contend that the trial needed to be continued in order to resolve an eleventh-amendment immunity defense.
This case has even been partially settled on the issue of monetary relief, and not once did defendants assert they were entitled to eleventh-amendment immunity of the type asserted today.
In anticipation of the resumption of trial, defendants filed many Rule 52 motions for judgment as a matter of law, but failed in any of them to assert eleventh-amendment immunity of the type asserted today, including immunity from resumption of trial.
The 1994 consent decree, which was executed by defendants, expressly provides for the resumption of trial, indeed within 180 days after the entry of the decree. The decree does not provide for any continuance or any appeal based on an assertion of any trial immunity.
The impact of granting the motion to stay is also significant. In writing this order, the court finds itself within one week of trial, a trial that is projected to last many months. In fact, the court has already set aside over *1441 40 trial days.[50] But more importantly, the plaintiffs and the Adams intervenors have engaged in significant preparation for this trial. Witnesses, including expert witnesses, are now ready to testify. Staying the trial at this late date would work a significant hardship on the parties.
On a practical level, beyond the seeming manipulation as a result of defendants' timing of the filing of their motions, their need for a stay of trial seems to have little import here and really seems unnecessary. First, unlike assertion of immunity claims in many other cases, defendants will be going to trial in this case anyway. Success on their motion to reclaim immunity will not make them immune from trial altogether, and if plaintiffs' contentions are correct because State official are named as co-defendants, and they are not immune from injunctive relief the defendants will have to present the same evidence they would have had to present anyway. Unlike many other cases, success on the immunity claim certainly will not keep the defendants from going to trial at all, and may not even limit the trial on any of the claims.
Finally and most critically, defendants waited until 19 days before trial was to resume, knowing, as admitted during a September 3 telephone conference, that they needed at least 30 days to brief the eleventh-amendment immunity issue. Defendants did this despite the fact that the court allowed them back in May 1997 to amend their answers to assert a belated eleventh-amendment immunity defense. Defendants offer no excuse for waiting from May until late August and September to present the issue to the court for briefing and resolution, they offer no excuse for waiting five years after the recess of the first trial and three years after entry of the consent decree to present this issue to court only 19 days before resumption of trial, and they offer no excuse for waiting over a decade after this case was first filed to raise the defense at all.[51]
If this case is not one in which a defendant has forfeited its eleventh-amendment trial immunity, then the right simply cannot be forfeited at all. The court will therefore enter an order denying the stay motion. In addition, to allay any jurisdictional concerns, as suggested by the Seventh Circuit in Apostol, this court will formally certify that trial immunity was waived and that its extremely belated assertion is frivolous. The court notes, however, that this decision has no impact on the defendants' continued right to assert their claim of eleventh-amendment immunity from judgment.[52]
III. CONCLUSION
For the foregoing reasons, it is ORDERED that defendants' motion for stay of trial proceedings, filed on September 4, 1997 (Doc. no. 2071), is denied.
It is further CERTIFIED that trial immunity under the eleventh amendment has been waived and its extremely belated assertion is frivolous.
NOTES
[1] Doc no. 2071.
[2] Doc. no. 2063.
[3] Doc. nos. 1, 36, 76, 78, 139, 264a, and 407.
[4] Doc. nos. 10, 13-16, and 48-51.
[5] Doc. no. 82.
[6] Doc. no. 92.
[7] Doc. no. 104.
[8] Doc. no. 115.
[9] Doc. no. 119.
[10] Doc. no. 122.
[11] Doc. no. 129.
[12] Doc. no. 132.
[13] Doc. no. 176.
[14] Doc. no. 182.
[15] Doc. no. 243.
[16] Doc. no. 260.
[17] Doc. no. 270.
[18] Doc. no. 321.
[19] Doc. no. 339.
[20] Doc. no. 339.
[21] Doc. no. 381.
[22] 1994 WL 899259 (M.D.Ala.1994); Doc. no. 553.
[23] Doc. no. 726.
[24] Doc. no. 1785.
[25] Doc. no. 1760.
[26] Doc. nos. 688-694.
[27] Doc. no. 734.
[28] Doc. no. 773.
[29] Doc. no. 988.
[30] Doc. no. 1003.
[31] Doc. no. 1036.
[32] Doc. no. 1212.
[33] Doc. no. 1333.
[34] Doc. no. 1419.
[35] Doc. no. 1447.
[36] Doc. no. 1707.
[37] Doc. no. 1777.
[38] Doc. no. 1874.
[39] Doc. no. 1879.
[40] Doc. no. 1880.
[41] Order dated Doc. no. 1961.
[42] Doc. no. 2063.
[43] Doc. no. 2066.
[44] Doc. no. 2063.
[45] Doc. no. 2071.
[46] Doc. no. 2072.
[47] Doc. no. 2070.
[48] Eleventh-amendment immunity does "partake of the nature" of a jurisdictional bar in the sense that it can be raised at any time by defendant, Edelman v. Jordan, 415 U.S. 651, 678, 94 S. Ct. 1347, 1363, 39 L. Ed. 2d 662 (1974), and, if raised properly raised, can even deprive a court of the authority to hear an issue. Pennhurst State Sch. Hosp. v. Halderman, 465 U.S. 89, 99, 104 S. Ct. 900, 907, 79 L. Ed. 2d 67 (1984). But it differs from jurisdiction in the sense that it is still an affirmative defense which must be raised by the defendant and thus can be waived. In other words, unlike jurisdiction, it can be waived and a court cannot on its own raise the defense. Patsy v. Board of Regents of the State of Fla., 457 U.S. 496, 515 n. 19, 102 S. Ct. 2557, 2567 n. 19, 73 L. Ed. 2d 172 (1982) ("[B]ecause of the importance of State law in analyzing Eleventh Amendment questions and because the State may, under certain circumstances, waive this defense, we have never held that [eleventh amendment immunity] is jurisdictional in the sense that it must be raised and decided by this Court on its own motion.")
[49] The First Circuit also noted that its decision "does not imply, however, that the defense has been waived for other stages of the litigation. Because the defense of qualified immunity may be raised and appealed at multiple stages of the trial, it would be inappropriate to find waiver for all stages in the current case." 98 F.3d at 669. In a similar vein here, this court only holds that defendants have waived trial immunity for the upcoming resumption of trial; the court does not have before it and, thus, does not address whether they have waived trial immunity as to any other proceeding.
[50] The court must candidly admit that, with its current heavy docket, it could take up other matters during this period in the absence of the trial.
[51] Defendants imply that a change in the law has warranted the delay on the assertion of the defense. They point to the Supreme Court's decision Seminole Tribe v. Florida, ___ U.S. ___, 116 S. Ct. 1114, 134 L. Ed. 2d 252 (1996). This decision was handed down in March 1996, and defendants offer no explanation as to why they waited over a year after the decision, to almost the eve of the resumption of trial, to seek a pretrial ruling from the court. More importantly, Seminole has been the law of the Eleventh Circuit since January 1994, Seminole Tribe v. Florida, 11 F.3d 1016 (11th Cir.1994), three months before entry of the 1994 consent decree, and defendants have offered no explanation for this three-year delay and, in particular, why they did not raise the issue at the time of the consent decree. Finally, the arguments made in Seminole are reported in cases as early as 1991, see, e.g., Poarch Band of Creek Indians v. Alabama, 776 F. Supp. 550 (S.D.Ala.1991), and defendants offer no reason as to why they could not have presented the issue to this court back then, if not earlier.
[52] See also supra note 49. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545881/ | 40 B.R. 574 (1983)
In re SALEM BANK BUILDING LIMITED PARTNERSHIP, a Virginia Limited Partnership, Debtor.
Bankruptcy No. 7-82-01624.
United States Bankruptcy Court, W.D. Virginia, Roanoke Division.
November 18, 1983.
Helen P. Parrish, Charlottesville, Va., for Debtor.
Roy V. Creasy, Roanoke, Va., for John H. Adler.
MEMORANDUM OPINION
H. CLYDE PEARSON, Bankruptcy Judge.
This matter came on for hearing upon the filing by counsel for John H. Adler, d/b/a Adler Leasing & Development Co. ("Adler"), of a Motion to Permit Creditor to Vote on the Plan of Reorganization and a Motion for Hearing on an Executory Contract.
Salem Bank Building Limited Partnership, the Debtor, filed a Chapter 11 petition in this Court on December 20, 1982. Adler was listed on the petition as an unsecured creditor. Adler filed a proof of claim in the case on March 29, 1983.
A. Motion to Permit Creditor to Vote on Reorganization Plan
On August 22, 1983, Debtor filed a Disclosure Statement and Plan of Reorganization ("Plan"). Notice of hearing on the Disclosure Statement was given to all creditors, including Adler, who appeared by counsel at the hearing. Copies of the approved *575 Disclosure Statement, along with copies of the Plan and ballots were mailed to all creditors on September 13, 1983. October 12, 1983 was set as the last day for filing objections to confirmation of the Plan and the hearing on confirmation was set for October 27, 1983. Adler filed no objection to confirmation and cast no ballot. Counsel for Adler appeared at the confirmation hearing and orally objected to confirmation, but did not vote. At this hearing, counsel for Debtor personally gave Adler's counsel a copy of the approved Disclosure Statement and the Plan.
On November 10, 1983, Adler, by counsel, filed his Motion requesting that he now be allowed to vote on the Plan, stating that he never received copies of the Plan or a ballot because they were mailed to an incorrect address. The Debtor objects to granting Adler's Motion on the grounds that proper notice was received by the creditor to enable him to vote in a timely fashion.
The evidence consists of statements by the respective counsel and the Court's records. Adler was originally listed on Debtor's petition at 2711 Wildwood Road, Salem, Virginia 24153. All notices were mailed to this address, none of which were returned to the Court or to Debtor's counsel. No change of address was ever filed by Adler or his counsel with the Court or with Debtor's counsel. Adler appeared by counsel at both the hearing on the Disclosure Statement and the hearing on Confirmation of the Plan.
The Court concludes that Adler received notice of the Plan, ballot, and confirmation hearing. The Motion to Permit Creditor to vote will be denied.[1]
B. Motion for Hearing on Executory Contract
On or about July 11, 1975, Adler entered into an Agreement with Salem Investment Association (Debtor's predecessor in interest) whereby Adler was appointed as exclusive Agent for a period of fifteen years. Adler's duties as Agent included soliciting tenants for the building, negotiating lease extensions and renewals, and collecting monthly rentals. Compensations for services rendered was to be in the nature of 6% of the gross rental income due Owner from each tenant. The contract further provided that the Agent's right to compensation arose on the procurement of a tenant and continued so long as the tenant remained a tenant of the Owner or Owner's heirs, assignees, transferees, or purchasers, and regardless of whether the Agent was terminated or relieved of duties and obligations under the Agreement.
Article V of Debtor's Plan provides for the assumption and assignment of certain unexpired leases of tenants in the subject building to the contract purchaser of the building. Several executory contracts, including the Agreement with Adler, are rejected by the Plan. Counsel for Adler contends that the Debtor cannot assume and assign the tenants' unexpired leases without also assuming his executory contract; he further requests that Debtor's Plan be modified to provide for payment of the commissions due him under the terms of the Agreement.
11 U.S.C. § 365(a) authorizes the assumption or rejection of executory contracts and unexpired leases:
(a) Except as provided in sections 765 and 766[2] of this title and in subsections (b), (c), and (d) of this section, the trustee, subject to the court's approval, may assume or reject any executory contract or unexpired lease of the debtor.
Pursuant to 11 U.S.C. § 1107(a), a debtor-in-possession has the same rights, powers, and duties as a trustee.
The 1978 Code is silent as to the circumstances under which the trustee or debtor-in-possession may reject a contract. There is no fixed standard to be applied in determining the propriety of the trustee's actions *576 in rejecting a contract, leaving unanswered the question whether the trustee's discretion alone prevails or whether some type of equitable standard should prevail.
Cases decided under the 1898 Act sometimes applied a benefit/burden type of analysis in determining whether rejection of an executory contract was proper. The guidelines for rejection included factors such as whether the contract was a benefit or a burden to the debtor's estate; whether it would help or hinder corporate reorganization; whether the contract is "risky"; whether large sums of money are called for to continue performance of the contract; whether the debtor, if free from the burden of the contract, would be in a better position to make current payments to other creditors, See 9A Am.Jur.2d, Bankruptcy § 519, and cases cited therein.
Other courts deciding cases under the 1898 Act applied a "business judgment" standard, rather than an onerous and burdensome test. This view held that the assumption or rejection of executory contracts should rest in the trustee's sound business judgment and discretion. The leading case which set forth this view is Group of Institutional Investors v. Chicago, Milwaukee, St. Paul & Pacific R. Co., 318 U.S. 523, 52 Am.B.R.(N.S.) 526, 63 S. Ct. 727, 87 L. Ed. 959 (1943). Using this standard, the trustee would not be obliged to assume contracts that are even marginally profitable if he deems the best interest or administrative convenience of the estate to be otherwise. Re 1430 Equities, Inc., 18 C.B.C. 289, 4 B.C.D. 806 (Bankr.S.D.N.Y. 1978).
In the instant case, this Court is satisfied that the appropriate test for determining the propriety of the debtor-in-possession's actions is the "business judgment" approach. It has been followed by numerous Circuit, District, and Bankruptcy Courts. See Borman's Inc. v. Allied Supermarkets, Inc., 706 F.2d 187 (6th Cir. 1983); In re Minges, 602 F.2d 38 (2nd Cir. 1979); Matter of Tilco, 558 F.2d 1369 (10th Cir.1977); In re Sombrero Reef Club, Inc., 18 B.R. 612 (Bankr.S.D.Fla.1982); In re Lafayette Radio Electronics Corp., 8 B.R. 528 (Bankr.E.D.N.Y.1981).
Under the business judgment test, a court should approve the debtor's proposed rejection if such rejection will benefit the estate. In re Minges, supra, at 43. Some courts have suggested that the role of the Court in this determination is minimal, and that rejection should be denied only where the trustee's or debtor-in-possession's decision is clearly erroneous. In re Sombrero Reef Club, Inc., supra, at 617; In re Summit Land Co., 13 B.R. 310 (Bankr.D.Utah 1981). This Court holds that the debtor-in-possession's decision to reject the executory contract in the present cases is not clearly erroneous. Indeed, the debtor's election to reject the executory contract has further been confirmed by action of its other creditors. The debtor's plan calls for its rejection as being in the best interest of the debtor's rehabilitation efforts. This further benefits all creditors affected and aids the debtor in carrying out its plan. Other creditors have exercised their best judgment and accepted the Plan as required by statute, which the Court has now confirmed. To deny the debtor's efforts to reject this contract would be unwise.
Adler is not without remedy. Federal Bankruptcy Rule 3002(c)(4) provides procedural machinery for asserting his claim for any damages sustained as a result of the breach brought about by the rejection.
It is a rare event for a creditor to resist a trustee or debtor's effort to reject an executory contract. Indeed, in Chapter 7 liquidations pursuant to 11 U.S.C. § 365(d)(1), unless the trustee affirmatively assumes an executory contract or unexpired lease within the prescribed time, it is deemed rejected as a matter of law.
An appropriate Order will issue approving the rejection.
NOTES
[1] The Plan having been accepted by a substantial vote, this creditor's voting for or against the Plan would be of little consequence.
[2] §§ 765 and 766 deal with commodity broker liquidation cases and, hence, inapplicable here. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545877/ | 40 B.R. 344 (1984)
In the Matter of COMPUTERIZED STEEL FABRICATORS, INC., Debtor.
Arrangement No. 78 B 883.
United States Bankruptcy Court, S.D. New York.
May 8, 1984.
*345 *346 Arutt, Nachamie, Benjamin, Lipkin & Kirschner, P.C., New York City, for debtor.
Sipser, Weinstock, Harper, Dorn & Leibowitz, New York City, for Pension Fund for Iron Workers Local 455.
HOWARD SCHWARTZBERG, Bankruptcy Judge.
The reorganized Chapter XI debtor, Computerized Steel Fabricators, Inc. ("Computerized"), seeks to punish for contempt Pension Fund Iron Workers Local 455 ("Pension Fund" or "Fund") for the Pension Fund's post-confirmation efforts to collect from the debtor an alleged withdrawal liability under the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), Pub.L. No. 96-364, 94 Stat. 1208, amending the Employee Retirement Income Security Act (ERISA), codified at 29 U.S.C. §§ 1001 et seq., which provides that if an employer ceases operations and terminates its employees, a withdrawal liability shall be incurred by the employer to the union involved. At the hearing regarding this issue, Computerized noted that it was not pressing the contempt aspect of its motion but rather urged that this court's previous order of confirmation discharged Computerized's obligations under its union contract, including the potential withdrawal liability.
FACTS
On May 15, 1978, Computerized filed a voluntary petition for an arrangement under Chapter XI of the Bankruptcy Act of 1898 as amended. At that time, Computerized was a party to a collective bargaining contract with Shopmen's Local Union No. 455, International Association of Bridge Structural and Ornamental Iron Workers, AFL-CIO (Local 455). At no time during the course of the Chapter XI proceedings did Computerized seek to reject the collective bargaining agreement as an executory contract in accordance with the provisions of Section 313(1) of the Act. Indeed, a new collective bargaining agreement was executed by Computerized and Local 455 in April, 1980, effective from July 1, 1979 through the pendency of the Chapter XI proceedings. Moreover, at no time during the Chapter XI proceedings did the Fund or Local 455 make any claim for existing or prospective withdrawal liability under MPPAA. The only claim filed by the Fund in the Chapter XI case was for delinquent monthly contributions owed under the collective bargaining agreements. The Fund's proof of claim stated that the Fund reserved all claims which the Fund might have by reason of statutory mandates.
On November 23, 1981, Computerized was discharged pursuant to this court's order of confirmation with respect to the Chapter XI plan of arrangement. Computerized continued in operation as a going concern and continued its contributions to the Fund until June, 1982. Two months earlier, Computerized notified Local 455 by letter dated April 20, 1982, that it would not renew its contract with Local 455, which was to expire by its terms on June 30, 1982. In June, 1982, Computerized permanently ceased all operations.
By letter dated May 6, 1983, one and one-half years following confirmation of Computerized's plan of arrangement, the Pension Fund notified Computerized that *347 Computerized owed the Fund the sum of $201,342 as a withdrawal liability under MPPAA, which consisted of $33,800.79 for pre-petition debt; $142,137.77 for debtor-in-possession liability; and $25,403.44 for post-confirmation liability.
Paragraphs 3, 4, and 5 of the November 23, 1981 Order of Confirmation[1] provide that the arrangement shall be binding on all claims affected by the plan; that the debtor shall be discharged of all its unsecured debts; and that all creditors affected by the arrangement shall be enjoined from taking any action in connection with such discharged claims. Computerized maintains that as a result of this court's order of confirmation and discharge, there was no post-confirmation contract in existence between Computerized and Local 455 to which withdrawal liability could attach and that any such claim for pre-confirmation involvement was discharged.
DISCUSSION
Computerized questions Pension Fund's assertion of a post-confirmation claim for withdrawal liability in accordance with the provisions of The Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), Pub.L. No. 96-364, 94 Stat. 1208, codified in scattered sections of 29 U.S.C. §§ 1001 et seq. The rationale for MPPAA is the assurance of pension rights for employees who might otherwise lose vested pension benefits when plans are terminated. In 1974, Congress enacted the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001 et seq. Under ERISA, the Pension Benefit Guaranty Corporation was created to provide insurance coverage for pension plan benefits in the event that a plan was terminated. However, multiemployer plans were not insured absolutely as were single employer plans. The participants in a terminated multiemployer plan might receive from the Pension Benefit Guaranty Corporation, at its discretion, the difference between the value of their guaranteed benefits and the value of the plan's assets on the date of termination. 29 U.S.C. § 1381(c)(2) (1974). If a plan terminated within five years of an employer's withdrawal from such plan and there were insufficient plan assets to provide benefits, the withdrawing employer became liable to the Pension Benefit Guaranty Corporation for the employer's proportionate share of the benefits paid, up to thirty percent of such employer's net worth. 29 U.S.C. §§ 1362, 1364. The problem of employer withdrawal was crucial in declining industries because withdrawals reduced the pension plan's contribution base and increased the financial burden on the remaining employers in order to fund past service liabilities. H.R.Rep. No. 869, 96th Cong., 2d Sess. 53-54 (1980), reprinted in 1980 U.S. Code Cong. & Ad.News 2918, 2922. One of the loopholes under ERISA was that an employer could withdraw from a plan and hope that the plan would survive for more than five years, in which event the employer would escape any withdrawal liability.
In order to close the five-year escape hatch for withdrawing employers, Congress enacted legislation in the Spring of 1979 which ultimately became the MPPAA on September 26, 1980, with retrospective effectiveness back to April 29, 1980. See 29 U.S.C. § 1461(e)(2). The retroactive date was used to prevent an employer from withdrawing from a plan under *348 the lenient rules then current. 123 Cong.Rec. 20,234 (1980) (statement of Senator Matsunaga). Under the 1980 amendments, an employer who withdraws from an ongoing multiemployer pension plan becomes absolutely liable on the date of withdrawal for a proportionate share of the plan's unfunded vested liability. Textile Workers Pension Fund v. Standard & Finishing Co., Inc., 725 F.2d 843 (2d Cir. 1984). "No longer did such behavior [employer's withdrawal] give rise, as it had under ERISA, to a contingent liability payable to the PBGC." Peick v. Pension Benefit Guaranty Corporation, 539 F. Supp. 1025, 1033 (N.D.Ill.1982).
Pursuant to MPPAA, a complete withdrawal occurs when an employer
(1) permanently ceases to have an obligation to contribute under the plan, or
(2) permanently ceases all covered operations under the plan.
29 U.S.C. § 1383(a). The liability of a withdrawing employer as calculated under MPPAA is expressed in 29 U.S.C. § 1391(b), which in general terms consists of multiplying the plan's aggregate unfunded vested liability by a fraction whose numerator is the sum of all contributions required to have been made by the withdrawing employer during the previous five years. The denominator is the sum of all contributions made by all employers during this same five-year period. In view of the fact that Computerized ceased all covered operations under the plan in June, 1982, it is deemed to have effected a complete withdrawal from a multiemployer plan covered under MPPAA at that time. Hence, the withdrawal liability claimed by the Pension Fund in the instant case implicates Computerized's aggregate contributions for the plan years 1978 through 1982, notwithstanding that Computerized's Chapter XI plan of arrangement was confirmed on November 23, 1981.
DOES THE UNION CONTRACT SURVIVE CONFIRMATION?
Computerized's contract with Local 455 was not rejected during the Chapter XI case. Instead, a new collective bargaining agreement was executed in 1980 which was to continue until June 30, 1982. This contract was never rejected by the debtor before the entry of the order of confirmation on November 23, 1981. Computerized maintains that by reason of the confirmation order and the discharge granted under Section 371 of the Act,[2] its contractual liability to Local 455 and the Pension Fund was extinguished. However, this position misses the point that an executory contract may be rejected in a Chapter XI case under Section 313(1) only by affirmative action and that unless it is so rejected, the contract continues in effect. See Federal's Inc. v. Edmonton Investment Co., 404 F. Supp. 68, 71 (E.D.Mich.1975), aff'd, 555 F.2d 577 (6th Cir.1977); 8 Collier on Bankruptcy ¶ 3.15[6], at 204 (J. Moore 14th ed. 1978). Thus, the non-debtor party to such a contract does not have a provable claim because such party's claim does not arise under the Act until the contract has been rejected. In re Greenpoint Metallic Bed Co., Inc., 113 F.2d 881, 883-84 (2d Cir. 1940); Mohonk Realty Corp. v. Wise Shoe Stores, Inc., 111 F.2d 287, 290 (2d Cir. 1940); Collier on Bankruptcy, supra, ¶ 3.15[10], at 208. Accordingly there can be no discharge or extinguishment of the Pension Fund's claim by the order of confirmation because the Pension Fund did not have a provable claim while the union contract continued during the Chapter XI case and while the debtor continued to make contributions in accordance with MPPAA.
WHEN DOES WITHDRAWAL LIABILITY ARISE?
Pursuant to 29 U.S.C. § 1383(e), "the date of a complete withdrawal is the date of the cessation of the obligation to *349 contribute or the cessation of covered operations." Thus, Computerized's complete withdrawal from the multiemployer plan occurred in June, 1982, when it notified Local 455 that it did not intend to renew the union contract that terminated on June 30, 1982 and when it ceased all covered operations under the plan. This event occurred more than one and one-half years following confirmation. Manifestly, post-confirmation claims are not affected by the discharge. However, as stated in In re Kessler, 23 B.R. 722, 725 (Bkrtcy.S.D.N.Y. 1982), "the calculation of withdrawal liability, though triggered post-petition, is based . . . on pre-petition factors."
Computerized is disturbed by the fact that its post-confirmation liability embraces financial data with respect to its pre-petition and pre-confirmation status. Because MPPAA authorized a recovery for a post-confirmation liability calculated upon pre-petition and pre-confirmation factors, Computerized argues that such statutory liability clashes with the paramount discharge provisions of the Bankruptcy Act. For this proposition, Computerized relies upon NLRB v. Bildisco, ___ U.S. ___, 104 S. Ct. 1188, 79 L. Ed. 2d 482 (1984), where the Supreme Court ruled that the authority of the Bankruptcy Court to permit the rejection of executory union contracts was superior to the enforcement of collective bargaining agreements under the National Labor Relations Act. However, there is no perceived tension between MPPAA and the Bankruptcy Act. Computerized's post-confirmation withdrawal liability under MPPAA was neither provable nor dischargeable under the Bankruptcy Act. Hence, Computerized's discharge with respect to its pre-confirmation unsecured claims pursuant to Section 371 of the Bankruptcy Act did not affect its post-confirmation withdrawal liability. Merely because the calculations of amounts in arriving at such liability include pre-petition and pre-confirmation factors does not mean that such liability should be regarded as having accrued either during a pre-petition or a pre-confirmation period. See Wyle v. Pacific Maritime Association (In re Pacific Far East Line, Inc.), 713 F.2d 476, 478 (9th Cir.1983); In re Kessler, 23 B.R. at 725. The entire liability was triggered when Computerized completely withdrew from the multiemployer plan in June, 1982.
CONSTITUTIONALITY OF THE MPPAA's APPLICABILITY TO THE UNION CONTRACT
Computerized maintains that its liability under MPPAA violates due process because MPPAA was not enacted until after Computerized entered into its multiemployer contract with Local 455. However, as previously noted, MPPAA was enacted in 1980 to close a loophole that existed under ERISA where withdrawal liability was not imposed upon an employer who withdrew from a multiemployer plan if the plan survived more than five years after such withdrawal. MPPAA simply continued the potential liability that existed during the five year period, but calculated the measure of such liability based upon the five year period immediately preceding the employer's withdrawal. 29 U.S.C. § 1391(b). Thus, MPPAA was in effect when Computerized withdrew from the plan so that Computerized was bound by the known consequences attending such withdrawal. A somewhat harsher situation occurred in Textile Workers Pension Fund v. Standard Dye & Finishing Co., 725 F.2d 843 (2d Cir.1984), where two employers withdrew from multiemployer plans during the hiatus period between September 26, 1980, when President Carter signed MPPAA into law, and the earlier effective date of April 29, 1980, as expressed in the bill itself. The Second Circuit Court of Appeals sustained the constitutionality of the retroactive application of MPPAA in the context of the four factors previously considered in connection with ERISA's single employer plan termination in Nachman Corp. v. PBGC, 592 F.2d 947 (7th Cir.1979), aff'd on other grounds, 446 U.S. 359, 100 S. Ct. 1723, 64 L. Ed. 2d 354 (1980), namely (1) the reliance interests of the parties affected; (2) whether the impairment of the private interest is effected in an area previously *350 subjected to regulatory control; (3) the equities of imposing the legislative burdens; and (4) the inclusion of statutory provisions designed to limit and moderate the impact of the burdens. In discussing the first factor, Circuit Judge Cardamone said:
While the MPPAA had not been passed at the time both of these employers ceased operations, its existencetogether with its retrospective withdrawal liability provisionwas a matter of public knowledge.
725 F.2d at 850. Unlike the employers in the Textile Workers Pension Fund case who withdrew from a multiemployer fund before MPPAA was signed into law, Computerized withdrew from the plan when MPPAA was already in effect as an amendment to ERISA. Computerized may not now be heard to say that it was free to withdraw from the Multiemployer plan at any time without triggering a withdrawal liability simply because MPPAA had not been enacted when it entered into its contract with Local 455. The withdrawal liability of ERISA had been in effect since 1974. MPPAA merely modified ERISA so as to create mandatory rather than contingent liability. MPPAA simply requires a withdrawing employer to pay its agreed upon share of the already vested, but not funded, liabilities. The application of MPPAA to Computerized's then existing contract with Local 455 is neither retroactive nor unconstitutional. Cf. Textile Workers Pension Fund v. Standard Dye & Finishing Co., 725 F.2d at 849-54.
CONCLUSIONS OF LAW
1. Computerized's agreement with Local 455 was not rejected during the Chapter XI case and continued in effect until its expiration on June 30, 1982.
2. Computerized's withdrawal liability under MPPAA arose in June, 1982, when it permanently ceased all covered operations under the multiemployer plan required under its agreement with Local 455.
3. The Pension Fund's post-confirmation claim arising out of Computerized's withdrawal liability under MPPAA was neither provable in the Chapter XI case nor was it discharged when the order of confirmation was entered on November 23, 1981.
4. The applicability of the MPPAA to Computerized's contract with Local 455 is neither retroactive nor unconstitutional.
5. Computerized's application to hold The Pension Fund in contempt for attempting to collect Computerized's post-confirmation withdrawal liability under MPPAA is denied.
SETTLE ORDER on notice.
NOTES
[1] Paragraphs 3, 4 and 5 of the Order of Confirmation provide:
3. The arrangement and its provisions shall be binding upon the Debtor and all creditors of the Debtor whether or not they have accepted said Arrangement or have filed their claims or are affected by said Arrangement, and whether or not their claims have been scheduled or allowed and are allowable.
4. The Debtor herein, by the confirmation of the proposed Arrangement, be and it hereby is discharged of all its unsecured debts and liabilities provided for by the said Arrangement or in this Order, but excluding such debts as under Section 17 of the Bankruptcy Act are not dischargeable.
5. All creditors affected by the terms of the Arrangement be and they hereby are forever restrained and enjoined from taking any further action or proceeding in connection with their said claims, except to enforce the consummation of the terms of the Arrangement as confirmed herein.
[2] Sec. 371. The confirmation of an arrangement shall discharge a debtor from all his unsecured debts and liabilities provided for by the arrangement, except as provided in the arrangement or the order confirming the arrangement, but excluding such debts as, under section 17 of this Act, are not dischargeable. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545829/ | 40 B.R. 181 (1984)
In re ROBERT L. HALLAMORE CORPORATION, Debtor.
Bankruptcy No. 83-1401-JG.
United States Bankruptcy Court, D. Massachusetts.
June 25, 1984.
*182 Neal Satran, Boston, Mass., for debtor.
James J. Coogan, Attleboro, Mass., for buyer and bank.
MEMORANDUM
JAMES N. GABRIEL, Bankruptcy Judge.
Before the Court is the debtor's Motion for Issuance of an Order approving the Debtor's Notice of Intended Sale. The debtor requests an Order because the purchaser's lending institution is insisting on a judge's approval of the sale for recording purposes.
The 1978 Bankruptcy Code radically changed the procedure for selling property of the estate.[1] It is now 1984 and it is time that lending institutions, conveyancing attorneys, and title companies become familiar with the Code.
Section 363(b) provides that:
"The trustee, after notice and a hearing, may use, sell or lease, other than in the ordinary course of business, property of the estate." 11 U.S.C. Section 363(b).
For the purposes of this Section, a Chapter 11 debtor in possession and a Chapter 13 debtor also have a Chapter 7 trustee's powers of sale. See 11 U.S.C. Section 1107; 11 U.S.C. Section 1303 (1979).
Thus, in Chapter 7, Chapter 11 and Chapter 13 cases, Section 363(b) simply requires "notice and a hearing" before the debtor may sell property. The phrase "after notice and a hearing" is defined in Code Section 102(1) as:
"such notice as is appropriate in the particular circumstances and such opportunity for a hearing as is appropriate in the particular circumstances, but. . . . authorizes an act without an actual hearing if such notice is given properly and if such hearing is not requested timely by a party in interest . . .". 11 U.S.C. Section 102(1) (1979).
As the Notes of the Committee on the Judiciary of the Senate indicate, this rule of construction is central to the separation of the administrative and judicial functions of bankruptcy judges. Senate Report No. 95-989, 5 U.S. Code Cong. & Admin. News 5787, 5813 (1978). The Note continues:
"If there is no objection to the proposed action, the action may go ahead without court action. This is a significant change from present law, which requires the affirmative approval of the Bankruptcy Judge for almost every action. The change will permit the Bankruptcy Judge to stay removed from the administration of the bankruptcy or reorganization case, and to become involved only when there is a dispute about a proposed action, that is, only when there is an objection." Id. at 5813.
The notice procedure for sales is set forth in Bankruptcy Rules 2002 and 6004, which became effective on August 1, 1983. Rule 2002 Subsection (a)(2) requires a twenty day notice of a sale to all creditors. The purpose of the notice is to provide an opportunity for objections and a hearing before the Court if there are objections. H.R. Rep. No. 595, 95th Cong. 1st Session 345 (1978) 5 U.S. Code Cong. & Admin. News at 6301 (1978). A Notice of an Intended Private Sale is sufficient if it includes the terms and conditions of the sale, *183 if it states the time for filing objections, and if the estate is selling real estate, if it generally describes the property.[2] Bankruptcy Rule 2002(c)(1) (1983). Bankruptcy Rule 6004(b) requires that any objection to a proposed sale be filed within five days before the date set for the proposed action or as set by the Court. If a timely objection is filed, a hearing is held on the merits of the objection. Bankruptcy Rule 6004(a). The Court then determines the propriety of the proposed sale in light of the objection. If the Court finds the objection unmeritorious, an Order approving the sale and overruling the objection is appropriate. Rule 6004(e) requires the filing of a statement with the clerk of the Bankruptcy Court upon completion of the sale by the debtor, trustee, or auctioneer.
In the absence of objections or counter-offers, a sale in accordance with Section 363, Rules 2002 and Rule 6004 does not require court approval. See Bankruptcy Rule 6004, Advisory Committee Note, Subsection (e). The commentators agree that in the absence of a dispute, there is no judicial involvement in and no court supervision of a sale. E.g., L. King, Collier On Bankruptcy, Paragraph 363.03, at 363-19 (15th ed. Supp.1983); W. Norton, 1 Bankruptcy Law and Practice, Section 24.03, 145, n. 1 (Supp.1983). Pursuant to Section 102(1), absent a request for a hearing the sale will take place without court order. In Re Upright, 5 B.C.D. 1124, 1 B.R. 694 (Bankr.N.D.N.Y.1979). Under Rule 6004(e)(2) the debtor is required to execute all documents to effect the sale.
In this case, on May 16, 1984, the debtor sent notice of the sale to all creditors which stated that objections and counter-offers were to be filed by May 26, 1984. The time for objections had been shortened per Order of the Court for cause in view of the necessity for an immediate sale. The case docket reflects that no objections, counter-offers, or requests for hearing were filed. Accordingly, an Order approving this sale is inappropriate, and the Motion is denied.
This ruling is not intended to subvert the concerns of the bar, title companies, and lending institutions for certainty of title. It is only out of frustration with the repeated demands of the conveyancing bar and their clients, and their total unwillingness to accept change, let alone their defiance of the plain meaning of the law, that, after some four and one half years, the Court's patience has been tried by those who still insist on "comfort orders." A suitable procedure exists whereby a Clerk's Certificate for recording purposes may be obtained, which certifies that no objections or requests for hearing were filed. Recordation of this instrument is notice to the world of the trustee's or debtor's authority to sell and is the appropriate method of satisfying the concerns for title of the real estate field.
In accordance with this opinion, the lending institution should comply with its contractual committment to fund the purchase of the debtor's assets without a court order approving the sale.
NOTES
[1] Prior to enactment of the 1978 Bankruptcy Code, under the former Bankruptcy Act, property could not be sold without court approval. The Bankruptcy Act of 1898, Section 70f, 11 U.S.C. Section 110 (repealed 1978). Indeed, the Bankruptcy Court was considered the vendor of estate property. J. Moore, 4B Collier on Bankruptcy, Par. 70.97, at 1130 (14th ed. 1978).
[2] A suitable form commonly used in the District for a Notice of Private Sale under the Code is set forth in H. Lavien, Bankruptcy Forms, Section 195.5 at 72 (Supp.1983). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1545852/ | 40 B.R. 156 (1984)
In the Matter of RICHLAND BUILDING SYSTEMS, INC., Debtor.
Bankruptcy No. MM7-81-01425.
United States Bankruptcy Court, W.D. Wisconsin.
June 20, 1984.
Michael E. Kepler, Madison, Wis., Trustee.
Daniel W. Stolper, Stafford, Rosenbaum, Rieser & Hansen, Madison, Wis., for creditor.
Richard L. Binder, Fowell & Keegan, Richland Center, Wis., for debtor.
MEMORANDUM DECISION
ROBERT D. MARTIN, Bankruptcy Judge.
This matter is before the court on a motion for approval of attorney fees arising from post-petition services rendered by the debtor's non-bankruptcy counsel. The trustee who was appointed when this case was converted from chapter 11 to chapter 7 has objected to payment for the unauthorized services performed while the debtor was in chapter 11.
The facts are not disputed. Early in 1980, prior to filing in bankruptcy, the debtor, Richland Building Systems, Inc. ("Richland"), retained the law firm of Stafford, Rosenbaum, Rieser & Hansen ("Stafford") to pursue a contract action. Richland signed a retainer agreement which authorized Stafford to proceed with litigation under an hourly fee schedule. On May 7, 1981 Stafford filed suit on Richland's behalf in Richland County Circuit Court.
Represented by other counsel, Richland filed in chapter 11 on August 19, 1981. Stafford did not learn of Richland's bankruptcy until September 21, 1981, just prior to an appearance in the state court action *157 to argue its motion for summary judgment. Despite an awareness that professionals retained by a debtor in possession must have bankruptcy court approval, Stafford continued to represent Richland in the state court action for a considerable time without such approval, terminating its representation only after a partial summary judgment in favor of Richland had been obtained. Under the retainer agreement the charge for Stafford's services and disbursements up to the time of Richland's filing was $1,455.90. Similarly calculated, the post-filing fees amount to $4,142.28, approximately $2,386.48 of which was incurred on and before September 21, 1981 and approximately $1,755.80 of which was incurred between that date and December 22, 1981, the last date on which Stafford provided services to Richland. Stafford contends that its withdrawal any time prior to December 22, 1981 would have seriously harmed Richland and that its unique efforts permitted Richland to obtain summary judgment on the issue of liability.
A damage award was negotiated to settlement by the trustee after his appointment on March 11, 1982. Stafford asserts that it has an equitable lien upon the settlement proceeds. The trustee objects to payment on the basis that no lien exists. The trustee further asks that if the court finds that a lien does exist, the lien be limited to those fees earned prior to the bankruptcy filing, because Stafford was never appointed as attorney for the debtor in possession as required by 11 U.S.C. § 327.
In bankruptcy, state law controls questions of attorney's liens. In Re Fitterer Engineering Associates, Inc., 27 B.R. 878 (Bankr.E.D.Mich.1983). The leading case on attorney's liens in Wisconsin is Wurtzinger v. Jacobs, 33 Wis. 2d 703, 148 N.W.2d 86 (1967). In Wurtzinger, the court recognized three types of attorney's liens. The first is the statutory lien under WIS.STAT. § 757.36. That lien requires an express grant of lien, and notice to the opposite party to preserve lien rights in settlement. The statutory lien when properly noticed is superior to the rights of other creditors in the action. Although there was a written fee agreement between Richland and Stafford, there is no specific written grant of a lien nor is there statutory notice of an intention to enforce the lien. Thus, even if the problems arising upon the filing of bankruptcy are ignored Stafford has not met the statutory requirements for a lien under WIS.STAT. § 757.36.
The second type of lien available to attorneys in Wisconsin is one on the client's papers. Stafford does not claim a retaining lien.
The third type of lien available to attorneys in Wisconsin is an equitable lien. In other states this is referred to as a common law attorney's charging lien and arises by operation of law upon a judgment in a contract or tort action. Wurtzinger, supra, at 712. Equitable liens generally arise when there is a written contract showing the intention to charge some particular property with payment of the debt for the services. Bartholomew v. Thieding, 225 Wis. 135, 273 N.W. 468 (1937).[1] That general statement of lien principles was ignored, however, in Wurtzinger where there was no showing of a written agreement between the attorney and the client regarding payment. Thus, the requirements for an attorney's equitable lien under Wisconsin law are not completely clear. The trustee in this case contends that at minimum a contingent fee arrangement either written or, if extraordinary circumstances are shown, oral, is necessary. That contention receives some support from the facts of the reported cases.
In Wurtzinger the Wisconsin Supreme Court does not state the nature of the parties' arrangement for payment of attorney's fees in that wrongful death action. However, many Wisconsin decisions on equitable liens rely on an agreement to charge the judgment with a lien. In Stanley *158 v. Bouck, 107 Wis. 225, 83 N.W. 298 (1900), the client assigned the past and future judgment to the attorney.[2] In Courtney v. McGavock, 23 Wis. 619 (1869), the client agreed to pay the attorney out of the proceeds of judgment, but then settled the case without the knowledge of his attorney.[3] In Liberty v. Liberty, 226 Wis. 136, 276 N.W. 121 (1937), the parties had a written agreement that the attorney would receive 50% of the proceeds.[4] Therefore, although the Wisconsin Supreme Court has never stated that a contingent fee agreement or other express intention to create a lien on the recovery is necessary, and has indeed suggested otherwise in dicta, the cases it has analyzed have contained this factor.
Nonetheless, the fact of the equitable lien's continued separate existence suggests that some purpose not served by other liens must be sought. The statutory lien already provides a means for attorneys to contract with their clients for liens on the proceeds of the action. The retaining lien allows an attorney to hold his clients' papers hostage. Additional protection for contingent fee agreements would not therefore seem necessary. The equitable lien appears more broadly to be a remedy to prevent unjust enrichment to a client whose attorney has performed well and secured a judgment. To serve such a broad purpose there is little reason to differentiate between contingency and hourly methods of calculating the fee. So long as the result achieved is directly related to the services for which the fee is sought and the result is a favorable money judgment, the basis of the fee would not have any significant impact on whether the client would be unjustly enriched at the expense of the lawyer who provided the service. Equity may thus allow a lawyer to have a lien for some or all of the services and disbursements leading to the recovery without regard to the terms of the fee agreement when such a lien is necessary to prevent unjust enrichment of the client.
Wisconsin has not directly addressed the issue of whether the equitable lien relates back to when the services were first rendered. Other states with common law attorneys charging liens have decided that the lien does relate back. In Re TLC of Lake Wales, Inc., 13 B.R. 593 (Bankr.M.D. Fla.1981); In Re Fitterer Engineering Associates, Inc., 27 B.R. 878 (Bankr.E.D. Mich.1983), cf. 7 Am.Jur.2d Attorneys at Law, § 332 (1980). This is consistent with the policy of preventing unjust enrichment. It would be inequitable to allow a debtor to use an attorney's services to create a specific fund and then defeat payment by filing bankruptcy before judgment. The soundness of permitting the law firm to reach back in time has not been actively disputed here.
How far forward the fees in this case ought to be protected by the lien is a more difficult question. Stafford asserts that their equitable lien should extend to services rendered after Richland filed bankruptcy. However, the services performed after the filing were performed for the estate, not the debtor, and the retainer agreement Stafford had with Richland, unless properly assumed, would not bind the estate to accept any professional services. However, if the debtor in possession or the trustee had sought and received either the *159 assumption of the agreement between Richland and Stafford or the appointment of Stafford as special counsel under 11 U.S.C. § 327(e), the fee incurred after the appointment clearly could be charged to the estate as an administrative expense.
Section 327 allows the court to assess the competency and experience of an attorney. It also provides an opportunity to evaluate the necessity of the services which the attorney is to perform. Both of these evaluations can be performed with equal or greater accuracy after the services have been performed. But that acknowledgment does not suggest that evils sought to be avoided by prior approval of professional services contracts should be readily ignored, or that a professional by rendering services to a trustee or debtor in possession can unilaterally bind an unwilling client. In this case the willingness of Richland to continue to retain Stafford arose prior to Mr. Kepler's appointment as trustee and may have been demonstrated as early as the first time that Stafford was allowed to proceed after it had requested of Richland but did not receive a motion for appointment. The success of the further proceedings led directly to the production of the settlement payment which the trustee was later able to negotiate and therefore is the basis for an equitable lien. But the common law right to enforce a lien does not provide a license to avoid approval of professional services by this court.
It has been argued that the necessary approval can be granted after the fact. Specifically it is argued that in the Seventh Circuit a bankruptcy court in certain circumstances, if the requirements of 11 U.S.C. § 327(c) are met, may make such an order appointing special counsel nunc pro tunc to the date on which the case was filed. Stolkin v. Nachman, 472 F.2d 222 (7th Cir.1973). See also In Re Triangle Chemicals, Inc., 697 F.2d 1280 (5th Cir. 1983). Both Stolkin and Triangle Chemicals, Inc. involve cases where the attorney served the debtor in preparation for bankruptcy as well as the other matters for which payment was sought. But in the present case Richland had separate bankruptcy counsel who waited more than one month after filing to advise Stafford that their joint client was in chapter 11. That delay may have provided tacit approval by Richland's bankruptcy counsel to Stafford's representation on the summary judgment motion, but once Stafford knew of the bankruptcy filing it was also aware that court approval of its further representation was necessary. Stafford initiated efforts to convince the bankruptcy counsel to prepare and file a motion for that approval, and continued to serve when those efforts proved fruitless.
The present case is materially different from both Stolkin and Triangle Chemicals, Inc. in other respects as well. Unlike the lawyer in Triangle Chemicals, Inc., Stafford was aware of the necessity of court approval for its continued service after September 21, 1981. Unlike Stolkin, there is no evidence that the trustee in this case is merely trying to avoid paying for services rendered to him in good faith. Because the trustee was not yet appointed when the unauthorized services were rendered, he was not in a position to condone the representation and then refuse to pay for it. His objection to the fee now is a technical objection to the allowance of claim in the prior chapter 11 due to Stafford's failure to obtain proper appointment by the bankruptcy court. There is no suggestion that Stafford's representation was not in Richland's best interest. Certainly a favorable result was obtained. But this court cannot find that Stafford's continued representation without court approval was made necessary by an emergency or by the nature of the state court's procedures. Stafford chose to proceed with its representation and not press for court appointment aware of the risk it was taking. The circumstances did not justify that action.
Thus, although there is no reason to doubt either the quality of the services provided by Stafford or the good faith with which they were provided, the firm's awareness that after September 21, 1981, it performed services to the estate without authority is sufficient to preclude the *160 court's approval of those fees retroactively. The claim of Stafford shall therefore be allowed in the amount of $3,842.38 calculated on the basis of fees earned and expenses incurred prior to September 22, 1981, and denied as to amounts earned or incurred thereafter. That allowed claim shall be charged as a lien upon the proceeds of settlement held by the trustee. Judgment may be entered accordingly.
NOTES
[1] But see the court's broad dictum that equitable liens arise "where an attorney or an accountant renders services which result in the production of the fund"225 Wis. at 138, 273 N.W. 468 which appears not to require a writing.
[2] But significantly, the Wisconsin Supreme Court stated in this opinion that, apart from the statutory lien, "when judgment has been recovered in an action, whether in contract or tort, the rule is well established that the attorney has an equitable lien thereon, by operation of law, for his services and disbursements in that action." 107 Wis. at 230, 83 N.W. 298. Such a lien "whether resting upon agreement or raised by operation of law, is complete without notice to the opposite party." Id. at 231, 83 N.W. 298 (dicta). Research does not disclose any later opinion overruling this view.
[3] Here the lien failed because defendant must have notice for lien to attach to settlement proceeds. 23 Wis. at 622-623 (ruling now enacted as statute, WIS.STAT. §§ 757.36, 757.37).
[4] But cf. the court's broad dictum that "[a]n attorney has a lien by operation of law upon a judgment obtained by his efforts to the extent of the value of his services and his expenses and disbursements." 226 Wis. at 139, 276 N.W. 121. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582829/ | 31 So.3d 390 (2010)
Dr. Benedict E. IDOWU, et al.
v.
Jeanne PURDOM, et al.
No. 2010-CC-0270.
Supreme Court of Louisiana.
April 9, 2010.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1587732/ | 783 N.W.2d 855 (2010)
2010 WI 57
William C. McCONKEY, Plaintiff-Appellant-Cross-Respondent,
v.
J.B. VAN HOLLEN, in his role as Attorney General of Wisconsin, Defendant-Respondent-Cross-Appellant.
No. 2008AP1868.
Supreme Court of Wisconsin.
Argued November 3, 2009.
Decided June 30, 2010.
*857 For the plaintiff-appellant-cross-respondent there were briefs by Lester A. Pines, Tamara B. Packard, and Cullen Weston Pines & Bach LLP, Madison, and Edward S. Marion and Edward S. Marion Attorney-At-Law LLC, Madison, and oral argument by Lester A. Pines.
For the defendant-respondent-cross-appellant the cause was argued by Lewis W. Beilin, assistant attorney general, with whom on the briefs was Raymond P. Taffora, deputy attorney general, and J.B. Van Hollen, attorney general.
An amicus curiae brief was filed by Brian W. Raum, James A. Campbell, and Alliance Defense Fund, Scottsdale, Ariz., and Samuel R. Taylor, Jr. and Samuel R. Taylor Jr. LLC, Kenosha, on behalf of the Wisconsin Family Council.
An amicus curiae brief was filed by William M. Conley, Callie M. Bell, Katherine C. Smith, and Foley & Lardner LLP, Madison, and Laurence J. Dupuis and ACLU of Wisconsin Foundation, Inc., Milwaukee, on behalf of Lambda Legal Defense and Education Fund, Inc., Fair Wisconsin, and ACLU of Wisconsin.
An amicus curiae brief was filed by Matthew W. O'Neill, Sara Elizabeth Dill, and Friebert, Finerty & St. John, S.C., Milwaukee, on behalf of League of Women Voters of Wisconsin Education Fund.
An amicus curiae brief was filed by Michael D. Dean, Michael D. Dean, LLC, and First Freedoms Foundation, Inc., Waukesha, and Richard M. Esenberg, on behalf of Community Leaders Dedicated to Children Raised by Married Mothers and Fathers.
¶ 1 MICHAEL J. GABLEMAN, J.
In November 2006, the people of Wisconsin approved the adoption of the following amendment to the Wisconsin Constitution:
Only a marriage between one man and one woman shall be valid or recognized as a marriage in this state. A legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid or recognized in this state.[1]
¶ 2 In July 2007, William McConkey, a voter and taxpayer, filed suit alleging, among other things, that this amendment (the "marriage amendment") was submitted to the people in violation of the constitution's requirement that voters must be allowed to vote separately on separate amendments (the "separate amendment rule"). In other words, McConkey claimed that the two sentences of the marriage amendment constituted two amendments, not one, and that because voters were not able to vote for or against each sentence, the marriage amendment was not validly adopted. The Attorney General countered that McConkey did not have standing to bring this claim because he suffered no *858 actual injury, and maintained that the amendment was adopted in conformity with the separate amendment rule.
¶ 3 The Dane County Circuit Court, Richard G. Niess, Judge, held that McConkey did have standing to bring suit because, assuming his claims are true, his rights as a voter were violated. Regarding the substance of his claim, the circuit court held that the two sentences of the amendment related to the same subject and furthered the same general purpose. Therefore, the two sentences constituted only one amendment. The court of appeals certified the case to this court, and we accepted review.
¶ 4 The two issues before us are:
(1) Does McConkey have standing to challenge the marriage amendment?
(2) Was the marriage amendment adopted in violation of the Wisconsin Constitution's separate amendment rule?
¶ 5 Though the precise nature of McConkey's alleged injury is difficult to define, we conclude that the policy considerations underlying our standing doctrine support addressing the merits of McConkey's claim, which we therefore choose to do.
¶ 6 We hold that Article XIII, Section 13 of the Wisconsin Constitutionthe marriage amendmentwas adopted in conformity with the separate amendment rule in Article XII, Section 1 of the Wisconsin Constitution, which mandates that voters must be able to vote separately on separate amendments. Both sentences of the marriage amendment relate to marriage and tend to effect or carry out the same general purpose of preserving the legal status of marriage in Wisconsin as between only one man and one woman.
I. BACKGROUND
¶ 7 During both the 2003 and 2005 sessions, the Wisconsin State Assembly and Senate adopted a joint resolution to amend the Wisconsin Constitution. Though the 2003 and 2005 versions contained minor procedural variations, the text of the resolution itself was identical. Both versions of the resolution contained what the parties have referred to as the title: "To create section 13 of article XIII of the constitution; relating to: providing that only a marriage between one man and one woman shall be valid or recognized as a marriage in this state." The substance of the resolution contained two sections. Section 1 stated the text of the proposed marriage amendment. Section 2 of the resolution addressed the numbering of the new proposed amendment.[2]
¶ 8 Because the joint resolution was passed by two successive legislatures, the amendment was submitted to the people for ratification.[3] Wisconsin voters were asked the following question:
*859 Marriage. Shall section 13 of article XIII of the constitution be created to provide that only a marriage between one man and one woman shall be valid or recognized as a marriage in this state and that a legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid or recognized in this state?
On November 7, 2006, Wisconsin voters approved this amendment by a vote of 59 percent to 41 percent.
¶ 9 William McConkey is a registered voter and taxpayer who opposed both propositions contained in the marriage amendment and voted against it. He filed suit on July 27, 2007, challenging the marriage amendment on the grounds that it violated the due process and equal protection guarantees in the Wisconsin and United States Constitutions, and on the grounds that it was adopted in violation of the separate amendment rule in Article XII, Section 1 of the Wisconsin Constitution. The Attorney General countered that McConkey suffered no actual injury and therefore did not have standing to bring any of his claims. The Attorney General further argued that neither the substance of the amendment nor the process by which it was adopted violated the state or federal constitutions.
¶ 10 On a motion to dismiss by the Attorney General, the Dane County Circuit Court, Richard G. Niess, Judge, held that McConkey did not have standing to bring his due process and equal protection claims, but did have standing as a voter to challenge the process by which the amendment was adopted. If an amendment were invalidly submitted to voters, the circuit court reasoned, all voters were injured no matter how an individual would have voted had the different propositions been submitted separately. On the merits of McConkey's claim, the court held that the marriage amendment satisfied the requirements of the separate amendment rule, explaining that both propositions related to the subject matter of marriage and were designed to accomplish the same purpose: "the preservation and protection of the unique and historical status of traditional marriage."
¶ 11 McConkey appealed, challenging the circuit court's holding on the merits of his separate amendment rule challenge.[4] The Attorney General cross-appealed, challenging the circuit court's grant of standing. The court of appeals certified both questions to this court, and this court accepted certification.
II. STANDARD OF REVIEW
¶ 12 Whether a party has proper standing to bring suit is a question of law that we review de novo. Krier v. Vilione, 2009 WI 45, ¶ 14, 317 Wis.2d 288, 766 N.W.2d 517. Whether an amendment to the Wisconsin Constitution was adopted in conformity with the proper procedures is also a question of law that we review de novo. Milwaukee Alliance v. Elections Bd., 106 Wis.2d 593, 604, 317 N.W.2d 420 (1982).
III. DISCUSSION
¶ 13 Before we can address the merits of McConkey's challenge, we must first confirm *860 whether McConkey's suit is properly before usthat is, whether McConkey has standing to bring his claim. Part A examines this question, concluding that the policies undergirding our standing doctrine support addressing the merits of McConkey's challenge. In Part B, we address whether the marriage amendment violates the constitution's separate amendment rule, concluding that it does not.
A. Does McConkey Have Standing?
¶ 14 The Attorney General argues that McConkey does not have standing to challenge the marriage amendment. He asserts that because McConkey would have voted "no" on both propositions, which McConkey concedes is true, he suffered no actual injury to a legally protectable interest.[5] McConkey, on the other hand, frames this case as a violation of his basic voting and speech rights.
¶ 15 As a general matter, a litigant advancing a constitutional claim must have suffered an actual injury to a legally protected interest. See State ex rel. First Nat'l Bank v. M & I Peoples Bank, 95 Wis.2d 303, 308, 290 N.W.2d 321 (1980). The law of standing in Wisconsin is construed liberally, and "even an injury to a trifling interest" may suffice. Fox v. DHSS, 112 Wis.2d 514, 524, 334 N.W.2d 532 (1983). Unlike in federal courts, which can only hear "cases" or "controversies,"[6] standing in Wisconsin is not a matter of jurisdiction, but of sound judicial policy.[7]Zehetner v. Chrysler Fin. Co., 2004 WI App 80, ¶ 12, 272 Wis.2d 628, 679 N.W.2d 919.
¶ 16 Standing requirements in Wisconsin are aimed at ensuring that the issues and arguments presented will be carefully developed and zealously argued, as well as informing the court of the consequences of its decision. See Moedern v. McGinnis, 70 Wis.2d 1056, 1064, 236 N.W.2d 240 (1975) ("[T]he gist of the requirements relating to standing . . . is to assure that the party seeking relief has alleged such a personal stake in the outcome of the controversy as to give rise to that adverseness necessary to sharpen the presentation of issues for illumination of constitutional questions."); In re Carl F.S., 2001 WI App 97, ¶ 5, 242 Wis.2d 605, 626 N.W.2d 330 (2001) ("The purpose of the requirement of standing is to ensure that a concrete case informs the court of the consequences of its decision and that people who are directly concerned and are truly adverse will genuinely present opposing petitions to the court.").
¶ 17 We sympathize with the argument that all voters are harmed by an amendment invalidly submitted to the people. Still, it is difficult to determine the precise nature of the injury here, and we are troubled by the broad general voter standing articulated by the circuit court. However, whether as a matter of judicial policy, or because McConkey has at least a trifling interest in his voting rights, we believe the unique circumstances of this case render the merits of McConkey's claim fit for adjudication.
¶ 18 Numerous reasons support our conclusion. First, McConkey has competently *861 framed the issues and zealously argued his case. Second, it is likely that if his claim were dismissed on standing grounds, another person who could more clearly demonstrate standing would bring an identical suit, raising judicial efficiency concerns. Third, the consequences of our decision are sufficiently clear; a different plaintiff would not enhance our understanding of the issues in this case. Fourth, a detailed analysis of the nature of an injury here might inappropriately require us to prematurely interpret the substance of the amendment. Fifth, as a law development court, we think it prudent that the citizens of Wisconsin have this important issue of constitutional law resolved. The question of whether an amendment was effectually adopted weighs heavily in favor of addressing the merits of McConkey's challenge. Finally, none of our prior cases concerning the separate amendment rule involved a challenge on standing grounds. Instead, we addressed the issue without articulating a specific injury, and were animated by policy considerations similar to those articulated today. See, e.g., State ex rel. Hudd v. Timme, 54 Wis. 318, 332-33, 11 N.W. 785 (1882) (deciding to address the separate amendment claim because "forcible" arguments against the amendment's validity were presented and because of the importance of settling whether an amendment is part of the constitution or not).
¶ 19 Because we conclude that the merits of McConkey's claim are fit for consideration, we now move to the substance of his claim.
B. Was the Marriage Amendment Adopted in Violation of the Separate Amendment Rule?
¶ 20 Article XII of the Wisconsin Constitution defines the procedures for amending the constitution. Section 1 provides that a proposed amendment passed by each house in successive legislatures is to be submitted "to the people in such manner and at such time as the legislature shall prescribe." Wis. Const. art. XII, § 1. It further specifies that if a majority of the voters approve the amendment, it shall become part of the constitution "provided, that if more than one amendment be submitted, they shall be submitted in such manner that the people may vote for or against such amendments separately." Id. This is the separate amendment rule.
¶ 21 After passage by both houses in two successive legislatures and approval by voters in a referendum on November 7, 2006, Section 13 of Article XIII of the Wisconsin Constitution was created to read:
Only a marriage between one man and one woman shall be valid or recognized as a marriage in this state. A legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid or recognized in this state.
This is the marriage amendment.
¶ 22 McConkey argues that the marriage amendment was adopted in violation of the separate amendment rule. Specifically, McConkey argues that the marriage amendment is comprised of two amendments that should have been presented to the voters separately, and that because it was not so presented, the marriage amendment was not properly adopted and is invalid, i.e., not currently part of the Wisconsin Constitution.
¶ 23 To be clear, the question before us is not whether the marriage amendment is good public policy or bad public policy, nor is its interpretation or application before us today. The issue before us is whether the marriage amendment was adopted in conformity with the constitutional requirement that the people be allowed to vote separately on separate amendments. See Milwaukee Alliance, 106 Wis.2d at 602, 317 N.W.2d 420 ("What is not before this court is the wisdom or constitutionality of *862 the substance of the amendment. The issue, instead, is whether the legislature met the constitutional and statutory requirements for submitting the amendment to the electorate.").
¶ 24 We begin our analysis in Part 1 by reviewing the text of the constitution's separate amendment rule and the three prior cases that have applied it. In Part 2, we define the test for determining whether an amendment violates the separate amendment rule. Finally, in Part 3, we apply the test to McConkey's challenge of the marriage amendment in this case.
1. The Constitution and Prior Case Law
¶ 25 Article XII, Section 1 states that amendments may be submitted to the people "in such manner . . . as the legislature shall prescribe." Thus, the constitution assigns considerable authority and discretion to the legislature in the way it submits amendments to the people for a vote. Our inquiry is "whether the legislature in the formation of the question acted reasonably and within their constitutional grant of authority and discretion." Milwaukee Alliance, 106 Wis.2d at 604, 317 N.W.2d 420.
¶ 26 This is not to say the legislature's discretion is without limit. The constitution is clear that the people must be able to vote for or against each amendment "if more than one amendment be submitted." Wis. Const. art. XII, § 1 (emphasis added). On its face, this language does not prohibit a single constitutional amendment from being complex or multifaceted, or from containing a variety of specific prescriptions and proscriptions. The constitutional text suggests that the separate amendment rule is implicated only when the substance of an amendment cannot be said to constitute a single amendment.
¶ 27 Our case law affirms this understanding. This court has examined whether a constitutional amendment violates the separate amendment rule on three prior occasions. Each merits discussion.
¶ 28 This court first encountered a separate amendment rule challenge in State ex rel. Hudd v. Timme, 54 Wis. 318, 11 N.W. 785 (1882). In that case, the constitutional amendment contained four distinct propositions: (1) members of the Assembly would serve two-year terms instead of one-year terms, and be elected from single districts; (2) senators would serve four-year terms instead of two-year terms, and be elected alternately in odd and even numbered districts every two years; (3) the legislature would meet no more than once every two years; and (4) legislative salaries would increase to $500. Id. at 326, 11 N.W. 785.
¶ 29 We rejected as absurd the contention that each distinct proposition must be submitted separately. Such an approach would make amending the constitution unduly difficult, especially for complex issues or when an overall change might be impossible to effectuate if the voters could choose to adopt certain parts of the proposed amendment and not others. Id. at 335-36, 11 N.W. 785.
¶ 30 Instead, we construed the separate amendment rule to require separate votes on "amendments which have different objects and purposes in view." Id. at 336, 11 N.W. 785. As such, we stated the following test: "In order to constitute more than one amendment, the propositions submitted must relate to more than one subject, and have at least two distinct and separate purposes not dependent upon or connected with each other." Id.
¶ 31 Applying this test to the facts of the case then before us, we concluded that all of the propositions related to the purpose of changing from annual to biennial sessions of the legislature. Id. Most interesting and relevant to McConkey's claim was our discussion of the legislative pay raise. This proposition was "less intimately and necessarily connected with the change to biennial sessions, yet it was clearly connected *863 with it." Id. at 337, 11 N.W. 785. We explained that it was "proper" to increase the pay of legislators because of the increased duties and service required by the amendment. Id. Though the legislature certainly could have submitted the propositions as separate amendments, it did not need to do so because the constitution grants the legislature discretion in this area. Id. As long as there is one general purpose, and the items are connected with that purpose, the legislature has great latitude as to how it drafts amendments. Id.
¶ 32 Our opinion went further and discussed other amendments that had been adopted. Article IV, Section 31 (since amended twice), for example, prohibited the legislature from passing special or private laws in nine different circumstances, and required the legislature to enact general laws for anything not prohibited by the amendment. Id. at 337-38, 11 N.W. 785. We noted that this amendment was far more open to challenge than the change from an annual to biennial legislature, but no one thought to challenge its validity. Id. Even so, we stated that the amendment constituted a single amendment. Id. at 338, 11 N.W. 785. The general purpose of the amendment was to "restrict the power of the legislature in the matter of enacting special and private laws." Id. Again we stated that while each of the specifically prohibited types of private or special laws could have been submitted separately, the legislature had the discretion to submit them together. Id. In fact, all of the seven amendments that had been adopted up to that point were subject to similar objections, we explained, but all were acceptable because they had "one general purpose in view." Id. at 339, 11 N.W. 785. All of the propositions in each "were connected with and intended to carry into effect" the one general purpose. Id.
¶ 33 We addressed the separate amendment rule again (among other issues) in State ex rel. Thomson v. Zimmerman, 264 Wis. 644, 60 N.W.2d 416 (1953). In that case, a constitutional amendment approved by the people made the following changes: (1) State Senate districts were to be created taking land area and population into account, not just population; (2) military personnel and "Indians not taxed," who were previously not counted in creating Senate and Assembly districts, were now to be counted; (3) Assembly districts were to be created using town, village, and ward lines, where previously they were to include county, precinct, town, and ward lines; and (4) Assembly districts no longer needed to fall entirely within a single Senate district. Id. at 653-54, 60 N.W.2d 416. The referendum question submitted to voters asked: "Shall sections 3, 4 and 5 of article IV of the constitution be amended so that the legislature shall apportion, along town, village or ward lines, the senate districts on the basis of area and population and the assembly districts according to population?" Id. at 651, 60 N.W.2d 416.
¶ 34 The Attorney General argued that the amendment followed the requirements announced in Hudd because all of the provisions were "necessary, or at least convenient and proper, for the accomplishment of the main purpose" of taking area as well as population into account in apportioning Senate districts. Id. at 656, 60 N.W.2d 416. The Thomson court accepted without discussion[8] that the main purpose was to take area as well as population into account in apportioning Senate districts, but *864 concluded that two of the propositions did not support this general purpose. Id. The changes to the Assembly districts eliminated the previous requirement that Assembly districts were to contain whole counties, a "drastic, revolutionary alteration" to the current constitutional scheme. Id. Relying on Hudd, we held that this change had "no bearing on the main purpose of the proposed amendment, . . . nor does it tend to effect or carry out that purpose." Id. Similarly, we held that the counting of untaxed Indians and military personnel was also "not a detail of a main purpose to consider area in senate districts." Id. at 657, 60 N.W.2d 416. Therefore, we concluded that the amendment was adopted in violation of the separate amendment rule. Id. at 660, 60 N.W.2d 416.[9]
¶ 35 The most recent case challenging an amendment under the separate amendment rule is Milwaukee Alliance v. Elections Bd., 106 Wis.2d 593, 317 N.W.2d 420 (1982). In that case, the amendment contained a series of changes to Article I, Section 8 permitting courts to deny or revoke bail for certain accused persons, and allowing courts to set conditions for releasebail among themfor the purposes of assuring the accused person's appearance in court, protecting the community, or preventing intimidation of witnesses. Id. at 602, 317 N.W.2d 420. The changes included both general statements of a court's power, as well as specific conditions tied to certain crimes. Id. at 601, 317 N.W.2d 420.
¶ 36 In that case, the issue was "whether the legislature in the formation of the question acted reasonably and within their constitutional grant of authority and discretion." Id. at 604, 317 N.W.2d 420. Citing Hudd, we asserted, "It is within the discretion of the legislature to submit several distinct propositions as one amendment if they relate to the same subject matter and are designed to accomplish one general purpose." Id. at 604-05, 317 N.W.2d 420.
¶ 37 We explained that the purpose of the amendment was "to change the constitutional provision from the limited concept of bail to the concept of `conditional release.'"[10]Id. at 607, 317 N.W.2d 420. We concluded that the anti-monetary bail and conditional release provisions did not need to be submitted separately because defeat of one of the propositions would have destroyed the overall purpose of the amendment.[11]Id. The Hudd standard was again *865 keythe legislature may submit multiple propositions within one proposed amendment so long as those propositions tend to effect and carry out one general purpose and are connected with one subject. Id.
2. Defining the Test
¶ 38 This is the fourth case challenging the validity of an amendment under the separate amendment rule. The dispute between the parties can be broken down into three issues. First, the parties disagree about the proper way to test the validity of an amendment under the separate amendment rule. Second, while both parties agree that the general purpose of the amendment is an important element of the test, they diverge over the method the court should use to determine the purpose. And third, the parties disagree over how the amendment in this case fares under the applicable test.[12]
¶ 39 First, the parties offer dramatically different versions of the operative test arising from these cases. McConkey focuses on the anti-logrolling purpose[13] of the separate amendment rule and contends that, in order to survive review, the various propositions in an amendment must be aimed at a single purpose and be interrelated and interdependent such that if the propositions had been submitted as separate questions, the defeat of one proposition would destroy the overall purpose of the multi-proposition proposal. The Attorney General, quoting Milwaukee Alliance, counters that "[i]t is within the discretion of the legislature to submit several distinct propositions as one amendment if they relate to the same subject matter and are designed to accomplish one general purpose." 106 Wis.2d at 604-05, 317 N.W.2d 420. He rejects the claim that propositions must be mutually dependent in order to be submitted as a single amendment.
¶ 40 We agree with the Attorney General. We reaffirm this court's repeated holdings that the constitution grants the legislature considerable discretion in the manner in which amendments are drafted and submitted to the people. The inquiry is "whether the legislature in the formation of the question acted reasonably and within their constitutional grant of authority and discretion." Milwaukee Alliance, 106 Wis.2d at 604, 317 N.W.2d 420. An otherwise valid amendment will therefore be construed as more than one amendment only in exceedingly rare circumstances.
¶ 41 The proper test is laid out in Milwaukee Alliance: "It is within the discretion of the legislature to submit several distinct propositions as one amendment if they relate to the same subject matter and are designed to accomplish one general purpose." Id. at 604-05, 317 N.W.2d 420. As we stated in Thomson, all of the propositions must "tend to effect or carry out" the purpose. Thomson, 264 Wis. at 656, 60 N.W.2d 416.
¶ 42 McConkey's position is inconsistent with the constitution's grant of discretion to the legislature, and is irreconcilable with these prior holdings. The distinct propositions need not be, as McConkey urges, interconnected and dependent upon one another such that if one proposition failed, the total purpose would be destroyed. While Hudd uses the phrase "dependent upon," the Hudd court did not use it to suggest an interdependency requirement as McConkey asserts. Instead, Hudd established the principle *866 that the propositions must relate to the same subject and be "dependent upon or connected with" the same general purpose. Hudd, 54 Wis. at 336, 11 N.W. 785 (emphasis added). In Hudd, we explicitly rejected the notion that the propositions had to be interdependent; we required only a "connection" between the provisions. Hence, the legislative pay raise did not doom the amendment in Hudd because, though it was "less intimately and necessarily connected with the change to biennial sessions," it was nonetheless "clearly connected with it" and "proper." Id. at 337, 11 N.W. 785. McConkey's approach undoubtedly would have required striking down the legislative pay raise in Hudd, and likely would have also doomed the amendment challenged in Milwaukee Alliance because of some of its specific provisions.[14] The propositions, then, need only relate to the same subject and tend to effect or carry out one general purpose.[15]
¶ 43 This, of course, raises the second issue on which the parties spend considerable timehow should the general purpose of an amendment be determined? McConkey proposes that the best method for determining the purpose is to look to the "relating to" clause in the title of the joint resolution. In this case, the joint resolution states the amendment relates to "providing that only a marriage between one man and one woman shall be valid or recognized as a marriage in this state." Going further, McConkey argues that this is the only source the court can use to determine purpose. This approach, he asserts, is consistent with the approach used in Article IV, Section 18 of the Wisconsin Constitution[16] relating to private bills, and utilizes the rules of statutory construction by focusing on a plain reading of the joint resolution's title. The Attorney General counters that an amendment's purpose should be determined from its text and the context in which it was adopted following the constitutional interpretive approach outlined in Dairyland Greyhound Park v. Doyle.[17]
*867 ¶ 44 The general purpose of a constitutional amendment is not an interpretive riddle. Text and historical context should make the purpose of most amendments apparent. A plain reading of the text of the amendment will usually reveal a general, unified purpose. A court might also find other extrinsic contextual sources helpful in determining what the amendment sought to change or affirm, including the previous constitutional structure, legislative and public debates over the amendment's adoption, the title of the joint resolution, the common name for the amendment, the question submitted to the people for a vote, legislative enactments following adoption of the amendment, and other such sources.
¶ 45 This appears to have been the general approach followed in Hudd. In that case, this court identified the four propositions contained in the amendment from its text, and the general move from an annual to biennial legislature was apparent. The amendment was also known to the public as the "biennial sessions amendment." Hudd, 54 Wis. at 325, 11 N.W. 785.
¶ 46 In Milwaukee Alliance, the court described the purpose of the amendment with particularity:
The purpose of the amendment was to continue the guarantee of bail to those entitled to it, to allow release of some persons without requiring money bail but with other reasonable conditions, and at the same time, under a structured system, to hold persons for limited periods without the option of bail when a court determines that such action is necessary to protect the community from serious bodily harm or to protect society's interest in the administration of justice by preventing the intimidation of witnesses.
Milwaukee Alliance, 106 Wis.2d at 608, 317 N.W.2d 420. This purpose appears to be gleaned from the text of the amendment. The court also described a general purpose of changing "from the limited concept of bail to the concept of `conditional release.'" Id. at 607, 317 N.W.2d 420. The court appeared to decipher this purpose by comparing the previous constitutional structure with the provisions in the new amendment.[18]
¶ 47 The method for determining the purpose advocated by McConkeyadopting verbatim the "relating to" clause in the title of the joint resolutionis supported neither by case law nor by common sense. None of our cases follow McConkey's approach. Neither Hudd nor Thomson even discuss the title of the joint resolution. In Milwaukee Alliance, we noted the statement of purpose contained in the title of the joint resolution, but did not adopt it as McConkey suggests we must do here.
¶ 48 McConkey's analogies to the restrictions on private bills in Article IV, Section 18 are also inapposite. The text of that provision itself states that private or local bills may encompass only one subject, "and that shall be expressed in the title." Wis. Const. art. IV, § 18. The separate amendment rule, however, contains no similar stricture, strongly suggesting the joint resolution's title should not be the conclusive, much less exclusive, statement of purpose. See Weber v. Town of Saukville, 209 Wis.2d 214, 231, 562 N.W.2d 412 (1997) (stating the rule of construction that when the terminology of similar provisions is different, an inference is drawn that different meanings are intended).
*868 ¶ 49 Finally, while the statement of purpose in the title is relevant and helpful, limiting review to the title alone makes little practical sense. McConkey argues that limiting review to the text of the title is akin to statutory construction. It is not. McConkey's approach does not even allow the court to read the text of the amendment itself, much less the text of the entire joint resolution! Far from being comparable to statutory construction, McConkey's approach requires the court to put on blinders with regard to the amendment's content.
¶ 50 In summary, "It is within the discretion of the legislature to submit several distinct propositions as one amendment if they relate to the same subject matter and are designed to accomplish one general purpose." Milwaukee Alliance, 106 Wis.2d at 604-05, 317 N.W.2d 420. The general purpose of an amendment may be deduced from the text of the amendment itself and from the historical context in which the amendment was adopted. And all of the propositions must "tend to effect or carry out" that purpose. Thomson, 264 Wis. at 656, 60 N.W.2d 416.
3. Applying the Test
¶ 51 The marriage amendment contains two propositions: (1) "Only a marriage between one man and one woman shall be valid or recognized as a marriage in this state"; and (2) "A legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid or recognized in this state." The text of this amendment and historical context in which it was adopted make its general subject and purpose plain.
¶ 52 A plain reading of the text of the amendment, in which both propositions expressly refer to "marriage," makes clear that the general subject of the amendment is marriage. McConkey does not seem to dispute this point.
¶ 53 Before the marriage amendment was adopted, marriage in Wisconsin was already limited by statute to the unions of one man and one woman. See Wis. Stat. § 765.001(2) (2005-06)[19] ("Under the laws of this state, marriage is a legal relationship between 2 equal persons, a husband and wife."); § 765.01 ("Marriage, so far as its validity at law is concerned, is a civil contract, to which the consent of the parties capable in law of contracting is essential, and which creates the legal status of husband and wife.").[20] This amendment was therefore an effort to preserve and constitutionalize the status quo, not to alter the existing character or legal status of marriage.
*869 ¶ 54 The first sentence preserves the one man-one woman character of marriage by so limiting marriages entered into or recognized in Wisconsin. The second sentence, by its plain terms, ensures that no legislature, court, or any other government entity can get around the first sentence by creating or recognizing "a legal status identical or substantially similar to that of marriage."[21] We need not decide what legal statuses identical or substantially similar to marriage are prohibited by this clause in order to understand its plain and general purpose.
¶ 55 Why preserve the status quo through a constitutional amendment? This is no secret either. The sponsors of the amendment were quite clear that state supreme court decisions overturning the marriage laws of other states were the primary reason for the amendment.[22] In short, the sponsors of the amendment wanted to protect the current definition and legal status of marriage, and to ensure that the requirements in the first sentence could not be rendered illusory by later legislative or court action recognizing or creating identical or substantially similar legal statuses. The purpose of the marriage amendment, then, was to preserve the legal status of marriage in Wisconsin as between only one man and one woman. Both propositions in the amendment tend to effect or carry out this general purpose.[23]
¶ 56 To conclude, the two propositions contained in the marriage amendment plainly relate to the subject of marriage. *870 And as the text of the amendment and context of its adoption make clear, the general purpose of the marriage amendment is to preserve the legal status of marriage in Wisconsin as between only one man and one woman. Both propositions in the marriage amendment relate to and are connected with this purpose. Therefore, the marriage amendment does not violate the separate amendment rule of Article XII, Section 1 of the Wisconsin Constitution. Rather, the marriage amendment was adopted by the people of Wisconsin using the process prescribed by the constitution, and is properly now part of our constitution.
IV. CONCLUSION
¶ 57 In summary, though the precise nature of McConkey's alleged injury is difficult to define, we conclude that the policy considerations underlying our standing doctrine support addressing the merits of McConkey's claim, which we therefore choose to do.
¶ 58 We hold that Article XIII, Section 13 of the Wisconsin Constitutionthe marriage amendmentwas adopted in conformity with the separate amendment rule in Article XII, Section 1 of the Wisconsin Constitution, which mandates that voters must be able to vote separately on separate amendments. Both sentences of the marriage amendment relate to marriage and tend to effect or carry out the same general purpose of preserving the legal status of marriage in Wisconsin as between only one man and one woman.
The judgment and order of the circuit court are Affirmed.
NOTES
[1] Wis. Const. art. XIII, § 13.
[2] The 2003 joint resolution also contained a further resolution that the "proposed amendment be referred to the legislature to be chosen at the next general election and that it be published for 3 months previous to the time of holding such election." The 2005 version contained additional resolutions related to the submission of the amendment to the people, including the question to appear on the ballot.
[3] Article XII, Section 1 of the Wisconsin Constitution, which contains the separate amendment rule, specifies one of the procedures for amending the constitution (the other is via a constitutional convention, see Wis. Const. art. XII, § 2). It provides in relevant part:
Any amendment or amendments to this constitution may be proposed in either house of the legislature, and if the same shall be agreed to by a majority of the members elected to each of the two houses, such proposed amendment or amendments shall be . . . referred to the legislature to be chosen at the next general election . . . and if, in the legislature so next chosen, such proposed amendment or amendments shall be agreed to by a majority of all the members elected to each house, then it shall be the duty of the legislature to submit such proposed amendment or amendments to the people in such manner and at such time as the legislature shall prescribe; and if the people shall approve and ratify such amendment or amendments by a majority of the electors voting thereon, such amendment or amendments shall become part of the constitution; provided, that if more than one amendment be submitted, they shall be submitted in such manner that the people may vote for or against such amendments separately.
[4] McConkey's due process and equal protection arguments are not before us on appeal.
[5] It is important to note that McConkey's standing argument comes to us under the procedural mechanism of a motion to dismiss, meaning that we take all facts alleged by McConkey to be true in determining whether he has standing to bring his claim. See Repetti v. Sysco Corp., 2007 WI App 49, ¶ 2, 300 Wis.2d 568, 730 N.W.2d 189.
[6] The United States Constitution limits the jurisdiction of federal courts to only "cases" or "controversies." See U.S. Const. art. III, § 2, cl. 1.
[7] We do, however, look to federal case law as persuasive authority regarding standing questions. Wisconsin's Envtl. Decade, Inc. v. Pub. Serv. Comm'n, 69 Wis.2d 1, 11, 230 N.W.2d 243 (1975).
[8] The beginning of the Thomson opinion does discuss the legislative "agitation" for including land area as well as population in the formation of legislative districts. State ex rel. Thomson v. Zimmerman, 264 Wis. 644, 649, 60 N.W.2d 416 (1953). It is unclear how important this was in the court's determination of the general purpose of the amendment.
[9] We also struck down the amendment on the grounds that the referendum question was invalid and "did not present the real question." See Thomson, 264 Wis. at 657-61, 60 N.W.2d 416.
[10] The joint resolution stated that the amendment related to "revising the right to bail and authorizing the legislature to permit circuit courts to deny release on bail for a limited period to certain accused persons." Milwaukee Alliance v. Elections Bd., 106 Wis.2d 593, 600, 317 N.W.2d 420 (1982). This "relating to" clause was certainly very similar to our articulation of the purpose. Nevertheless, we did not adopt or appear to consider it in our formulation of the purpose.
[11] We explained as follows:
The Alliance argues that the issues of conditional release and anti-monetary bail should have been submitted to the voters as separate questions, because the successful adoption of either one would not have destroyed the usefulness of the other. That is not realistic. When the purpose of the proposed amendment was to change the historical concept of bail with its exclusive purpose of assuring one's presence in court, as defined by common law, to a comprehensive plan for conditional release, the defeat of either proposition would have destroyed the overall purpose of the total amendment.
Milwaukee Alliance, 106 Wis.2d at 607, 317 N.W.2d 420.
[12] This third issue is discussed in Part 3.
[13] "Logrolling" is the joining of "unrelated provisions and creating a union of interests to secure passage" of legislation, or here, a proposed constitutional amendment. State ex rel. Wisconsin Senate v. Thompson, 144 Wis.2d 429, 445, 424 N.W.2d 385 (1988).
[14] One provision in the amendment at issue in Milwaukee Alliance, for example, stated, "In determining the 10-day and 60-day periods [specified in the amendment], the court shall omit any period of time found by the court to result from a delay caused by the defendant or a continuance granted which was initiated by the defendant." Wis. Const. art. I, § 8(3). The defeat of this proposition would surely not have defeated the overall purpose of the amendment of changing "from the limited concept of bail to the concept of `conditional release.'" Milwaukee Alliance, 106 Wis.2d at 607, 317 N.W.2d 420. However, it was connected with and tended to effect or carry out that purpose, and its inclusion therefore did not violate the separate amendment rule.
[15] Our prior cases have described, and we affirm here today, a test inquiring into both the subject matter and purpose of an amendment, suggesting a two-part test. See Milwaukee Alliance, 106 Wis.2d at 604-05, 317 N.W.2d 420. In practice, however, the analysis in our prior cases has blended these two, often neglecting to discuss or analyze the subject matter of an amendment. See, e.g., Hudd, 54 Wis. at 337-39, 11 N.W. 785 (generally neglecting the discussion of the "subject" component of the test in its analysis). This is probably why the parties focus their arguments on how the purpose of an amendment should be determined; they do not debate how the subject of an amendment should be determined.
[16] Article IV, Section 18 provides: "No private or local bill which may be passed by the legislature shall embrace more than one subject, and that shall be expressed in the title."
[17] Dairyland states that the constitution should be construed by reference to the plain meaning of the provision, the debates and practices at the time, and the earliest legislative action following adoption. Dairyland Greyhound Park, Inc. v. Doyle, 2006 WI 107, ¶ 19, 295 Wis.2d 1, 719 N.W.2d 408.
[18] The Thomson case, on the other hand, is a bit of an anomaly with regard to the determination of purpose. The court appeared to accept the statement of purpose proffered by the Attorney General, the officer charged with defending the amendment. See Thomson, 264 Wis. at 656, 60 N.W.2d 416. The court did not attempt to craft a purpose of its own, and seemed to suggest that the parties agreed on the purpose of the amendment.
[19] All subsequent references to the Wisconsin Statutes are to the 2005-06 version unless otherwise indicated.
[20] Wisconsin Stat. § 765.001(2) states the public policy objectives and intent of the legislature in its regulation of marriage. It provides in relevant part:
It is the intent of chs. 765 to 768 to promote the stability and best interests of marriage and the family. It is the intent of the legislature to recognize the valuable contributions of both spouses during the marriage and at termination of the marriage by dissolution or death. Marriage is the institution that is the foundation of the family and of society. Its stability is basic to morality and civilization, and of vital interest to society and the state. The consequences of the marriage contract are more significant to society than those of other contracts, and the public interest must be taken into account always. . . . The impairment or dissolution of the marriage relation generally results in injury to the public wholly apart from the effect upon the parties immediately concerned. Under the laws of this state, marriage is a legal relationship between 2 equal persons, a husband and wife, who owe to each other mutual responsibility and support.
[21] McConkey argues that the second sentence has nothing to do with the first, an assertion that strains credulity. While the second sentence attempts to accomplish something different than the first sentence, it is plainly related to and connected with the overall purpose of the amendment.
[22] In the appendix to its brief, the Attorney General provided a copy of a memo dated January 29, 2004, from the sponsors of the amendment to fellow state legislators soliciting co-sponsorship of the proposed amendment. A copy is also available online at http://graphics2.jsonline.com/graphics/ multimedia/media/oct06/legis3.pdf. (last visited June 25, 2010). The sponsors explained their proposal as follows:
We are introducing LRB 4072/2 for first consideration. LRB 4072/2 is a proposed constitutional amendment that would preserve the institution of marriage in this state as it has always beenbetween a man and a woman.
Last fall, the Massachusetts Supreme Judicial Court used the Massachusetts State Constitution to completely redefine marriage.. . .
Nothing in our state constitution presently protects against our State Supreme Court doing the same thing the Massachusetts Supreme Court did in 2003 (or the Vermont Supreme Court did in 1999 or the Hawaii Supreme Court did in 1993, followed up by a state constitutional amendment there) and legislating from the bench to radically alter marriage in this state and judicially impose same-sex marriage on this state. . . .
This proposal would prevent same-sex marriages from being legalized in this state, regardless of the name used by a court or other body to describe the legal institution. The proposal preserves "marriage" as it has always been in this state, as a union between one man and one woman. In addition, the proposal states that a legal status identical or substantially similar to that of marriage for unmarried individuals shall not be valid in this state, regardless of what creative term is used. . . .
[23] Five other state supreme courts have addressed similar questions regarding similarly worded marriage amendments and challenges under their own separate amendment rules. All have reached the same result we do here. See Arizona Together v. Brewer, 214 Ariz. 118, 149 P.3d 742 (2007); Advisory Opinion to the Attorney General Re Florida Marriage Prot. Amendment, 926 So.2d 1229 (Fla.2006); Perdue v. O'Kelley, 280 Ga. 732, 632 S.E.2d 110 (2006); Forum for Equality PAC v. McKeithen, 893 So.2d 715 (La.2005); Albano v. Attorney General, 437 Mass. 156, 769 N.E.2d 1242 (2002). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3344580/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.] MEMORANDUM OF DECISION RE: DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
The plaintiff, Cecelia Arendt, brings this action for injuries and losses sustained when she tripped over a ridge in the street while attempting to walk across Methodist Street in New London, CT. The plaintiff alleges that the defendant, City of New London, was under a duty to keep and maintain said street in good repair.
On April 27, 1999, the defendant filed a motion for summary judgment and a memorandum of law in support.
On May 14, 1999, the plaintiff filed an objection to the motion and a supporting memorandum of law.
"Summary judgment shall be rendered forthwith if the pleadings, affidavits and other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." (Internal quotation marks omitted.) Doucette v. Pomes, 247 Conn. 442, 452,724 A.2d 481 (1999).
The defendant argues that the exclusive remedy of the plaintiff in this action is General Statutes § 13a-149, which requires that a claimant give written notice to either the selectman, City Clerk, or other officer of the municipal corporation, prior to maintaining a cause of action. The defendant further argues that the plaintiff has failed to comply with the this notice requirement because the only notice given by the plaintiff was an accident report filed with the City Manager.
In opposition, the plaintiff argues that the filing of a written notice with the City Manager of New London is the same as CT Page 10205 filing such notice with the first selectman and, therefore, there is statutory compliance.
General Statutes § 13a-149 provides that "any person injured in person or property by means of a defective road or bridge may recover damages from the party bound to keep it in repair . . . No action for any such injury shall be maintained against any town, city, corporation or borough, unless written notice of such injury and a general description of the same and of the cause thereof and of the time and place of the occurrence, shall within ninety days thereafter be given to a selectman orclerk of such town or to the clerk of such city or borough, or tothe secretary or treasurer of such corporation." (Emphasis added.) General Statutes § 13a-149.
"Whether notice is sufficient [to satisfy the statutory requirements] is normally a question of fact for the jury,"Bassin v. Stamford, 26 Conn. App. 534, 539, 602 A.2d 1044 (1 992). "Before submitting the question to the jury, however, the trial court must first determine whether, as a matter of law, a purported notice patently meets or fails to meet . . . the statutory requirements." (Citation omitted; internal quotation marks omitted.) Ozmun v. Burns, 18 Conn. App. 677, 681,559 A.2d 1143 (1989).
The giving of notice, sufficient to satisfy the requirements of the statute, is a condition precedent to the maintenance of an action under it. Marino v. East Haven, 120 Conn. 577, 578-79,182 A. 225 (1935). "The obligation to comply with the statute in this respect rests upon the plaintiff, and lacking such sufficient notice he has no cause of action which he can maintain against the defendant town." Id., 579. The purpose of requiring a notice is to furnish the government entity involved such information as will enable [it] to intelligently investigate the facts upon which the claim is based." Id.
Here, the plaintiff filed an accident report with the City Manager of New London, wherein the plaintiff gave a general description of the injury sustained, the defective condition complained of, and the time and place of the injury.
The defendant does not argue, nor does the court find, that the notice was inadequate because of its content. Hence, the sole issue presented is whether notice to the City Manager satisfies the notice requirement of General Statutes § 13a-149. CT Page 10206
Exceptions to the manner in which the notice of injury is to be given has been made where the notice, although addressed to the wrong official, reaches the right hands within the requisite period of time. See Costello v. City of Norwalk, Superior Court, judicial district of Fairfield at Bridgeport, Docket No. 268834 (April 25, 1991, Katz, J.) ("an improper address should not prove fatal so long as the notice reaches the right hands within the requisite period of time"). See also Bliss v. City of Norwalk,
Superior Court, judicial district of Stamford/Norwalk at Stamford, Docket No. 135308 (February 9, 1995, D'Andrea, J.) (a notice improperly addressed to the Town Clerk, instead of the City Clerk, satisfies the requirements of 13a-149 because it "reached the right hands . . . within the requisite period of time"); Sbriglio v. Town of Wethersfield, Superior Court, judicial district of Hartford/New Britain at Hartford, Docket No. 439399 (October 18, 1996, Hennessey, J.) (18 Conn. L. Rptr. 72) (notice improperly addressed to Town Manager but which reached Town clerk satisfied requirements of notice under 13a-149).
Here, the City Clerk for the City of New London, Clark Van Der Lyke, by way of affidavit, swears that he is the official responsible for maintaining the statutory notices filed with the City of New London, and that a search of his files reveals no statutory notice filed by or on behalf of the plaintiff. Hence, unlike the aforecited cases, the statutory notice never reached the requisite official within the requisite period of time.
Moreover, the savings clause contained within General Statutes § 13a-149 does not cure the defective notice.
The savings clause provides that "[n]o notice given under the provisions of this section shall be held invalid or insufficient by reason of an inaccuracy in describing the injury or in stating the time, place or cause of its occurrence, if it appears there was no intention to mislead or that such town, city, corporation, or borough was not in fact misled thereby." General Statutes § 13a-149.
Based on the plain language of the statute, the savings clause is intended to apply to defects in the content of the notice rather than to the manner in which the notice is served.
Consequently, since notice was not received by the requisite city official within the requisite period of time, the notice is CT Page 10207 patently defective. The motion for summary judgment is hereby granted.
Mihalakos, J. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1584963/ | 382 N.W.2d 16 (1986)
222 Neb. 33
Douglas Michael DELANEY, Appellant,
v.
Linda Fern DELANEY, Appellee.
No. 85-265.
Supreme Court of Nebraska.
February 21, 1986.
*17 William G. Line and David G. Hartmann of Kerrigan, Line & Martin, Fremont, for appellant.
John R. Bellavia, Jr., of Bellavia Law Office, Fremont, for appellee.
KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.
PER CURIAM.
The petitioner-appellant father, Douglas Michael Delaney, appeals from that portion of the trial court's dissolution decree which places custody of the parties' minor child, Melinda, with the respondent-appellee mother, Linda Fern Delaney. We reverse and remand for the entry of a decree which places custody of the child with the father.
The parties were married at Fremont, Nebraska, on April 20, 1979. Melinda was born on November 2, 1980, making her 4 years old at the time of trial. The father was 39 years old at the time of trial and the mother 36.
The parties lived in Fremont until late 1982 when they moved to Texas. The father returned to Fremont in August of 1983; the mother moved first to one town in Colorado and then to Cripple Creek, Colorado, where she was living at the time of trial.
The father has been a truckdriver most of his adult life. At the time of trial he traveled and was able to spend only about 1½ to 2 days a week at home. He testified that if he were to be awarded custody of Melinda, he would try to get work which would keep him at home more. During the time the father had Melinda's custody under a prior order of the court, from July 1984 to the time of the dissolution decree, February 19, 1985, the child lived with the father's parents at their farm. The evidence is that Melinda was happy and enjoyed being with her paternal grandparents, whom the mother characterizes as good and loving people.
The evidence establishes that beginning in 1982, the mother began to spend the nights away from the parties' home, until the early morning hours. She admits to having had three sequential sexual relationships, one in Fremont and two after the move to Texas. In fact, she moved from Texas to Colorado to live with one of the men, whom the child calls "Daddy Don," but she left his mountain home a few weeks before the trial and moved into a two-bedroom house in town so that her two sons from a prior marriage could be nearer their school. Although at one time she thought of marrying the man with whom she had lived, she now describes their relationship as that of good friends. The mother was not employed at the time of trial but had worked from time to time as a waitress and as a barmaid. Her income at the time of trial consisted of child support payments for her two sons, food stamps, and financial help from her mother. She testified that she hoped to obtain employment at the mine in Cripple Creek or at one of the curio shops.
While there is evidence that the father at times drank to excess and mistreated the *18 mother, the mother herself admits that he never at any time mistreated the child.
Custody matters are initially entrusted to the sound discretion of the trial judge, which matters, on appeal, will be reviewed de novo on the record and affirmed in the absence of an abuse of the trial judge's discretion. In that review we will, where the evidence is in conflict, give weight to the fact that the trial judge observed and heard the witnesses and accepted one version of the facts rather than another. Chalupa v. Chalupa, 220 Neb. 704, 371 N.W.2d 706 (1985).
Our review convinces us that the trial court did abuse its discretion. The father has demonstrated a better ability to provide the child with a stable and wholesome environment than has the mother. It is true that placing custody with the father will likely mean the child will spend more of her time with his parents than with him. On the other hand, the mother's future employment just as likely means that neither will she be able to spend all of her time with the child.
In view of that determination we need not, and therefore do not, consider the father's other assignments of error.
The cause is remanded for the entry of a decree placing custody of the child in and with the father and giving the mother reasonable rights of visitation.
REVERSED AND REMANDED WITH DIRECTION. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1584969/ | 382 N.W.2d 406 (1986)
WESTERN BANK, Sioux Falls, South Dakota, Plaintiff and Appellee,
v.
RaDEC CONSTRUCTION COMPANY, INC., Defendant and Appellant.
No. 14858.
Supreme Court of South Dakota.
Considered on Briefs November 20, 1985.
Decided February 12, 1986.
*407 Robert E. Hayes, Davenport, Evans, Hurwitz & Smith, Sioux Falls, for plaintiff and appellee.
James T. Goetz, Goetz, Hirsch & Klimisch, Yankton, for defendant and appellant.
*408 HERTZ, Acting Justice.
This civil appeal arises from a directed verdict in favor of Western Bank ("Bank"), from which RaDEC Construction Company, Inc. ("RaDEC"), was ordered to pay the sum of $11,718.71 to Bank plus costs and disbursements associated with this action. We affirm.
Statement of Facts
Located in Hartington, Nebraska, RaDEC is a general contractor engaged in the construction of commercial buildings. At all times pertinent to this action, RaDEC was involved in the construction of a medical center in Huron, South Dakota. One of RaDEC's sub-contractors on this job was Jerry Ball ("Ball"), d/b/a Contractor's Carpet Center ("Carpet Center").
RaDEC became aware of the fact that Carpet Center was having difficulty furnishing the necessary materials and labor required to complete the job at the medical center. This was apparently due to Carpet Center's financial problems. Thereafter, RaDEC's president, Clarence Hoesing ("Hoesing"), had a telephone conversation with Carpet Center on December 13, 1982, in which Hoesing agreed to forward a check for $8,743.52 to Ball provided, however, that Ball (1) furnish certain paid invoices for material delivered, (2) provide necessary additional material, and (3) perform certain assurances pertaining to the installation of the material on December 14, 1982.
Hoesing then proceeded to make out a handwritten check to Carpet Center. In the lower lefthand corner of the check, (in the spot which generally indicates "memo"), Hoesing typed the phrase, "Payee must prove clear title to material." At trial, Hoesing testified that he considered the check to be "conditioned" upon Carpet Center's performance of the three foregoing requirements which Ball agreed to in their telephone conversation. Hoesing further testified that he had employed this practice (e.g. writing "conditional checks") three or four times a year for many years under similar circumstances.
The check was delivered to Carpet Center, in Huron, on December 14, 1982. Ball deposited the check with Bank on the same day. Bank handled the deposit as a "cash" item and thereby permitted Carpet Center to take immediate withdrawal.
Also, on December 14, 1982, RaDEC learned that Carpet Center had not performed the three requirements pursuant to their discussion the day before. As such, RaDEC stopped payment on the check. However, RaDEC was unaware of what financial institution Carpet Center would use, thus, Bank learned of the stopped payment on December 30, 1982, through normal banking channels. Thereafter, Bank attempted to recover the amount of the check from Carpet Center but was prevented from doing so by Carpet Center's insolvency. Consequently, Bank brought suit against RaDEC claiming that Bank was a holder in due course.
At trial, Bank stated that it had the option of handling the check as a "cash" or "collection" item. Bank also stated that the check in question was a "typical cash item" which required no special handling. In reference to the fact that Carpet Center's account with Bank was overdrawn by $36 at the time relevant to this action, Bank stated that, "very little attention was paid to that $36 overdraft. For a commercial account to be overdrawn $36 is rather a minor sum, very little attention would have been paid to that."
By contrast, RaDEC argues that its check was conditional in nature; that Bank should have been put on notice by the phrase "payee must prove clear title to material" which appeared on the face of the check, and thereafter, treated the check as a "collection item." Finally, RaDEC contends that Bank could not be a holder in due course because RaDEC's check did not contain an unconditional promise to pay, and therefore, Bank took it with notice of RaDEC's possible defense.
The issues raised by this appeal will be hereafter separately stated under appropriate headings.
*409 I
WHETHER THE CHECK IN QUESTION CONTAINED AN UNCONDITIONAL PROMISE TO PAY?
The trial court directed a verdict for the Bank at the close of all the evidence, holding as a matter of law, that the phrase typed in at the lower left corner of the check, "payee must prove clear title to material," did not have the effect of making the check conditional, and that Bank was a bona fide holder in due course. This was a law question properly addressed by the trial court. Although determination of whether notice has been given is a question of fact for the jury, construction or sufficiency of the notice is for the court. Great Central Insurance Co. v. Bowery Savings Bank, 142 Ga.App. 630, 236 S.E.2d 772 (1977).
SDCL 57A-3-104(1) sets forth four elements necessary to constitute a writing as a negotiable instrument. (a) It must be signed by the maker; (b) contain an unconditional promise or order to pay a sum certain in money and no other promise, order, obligation or power given by the maker or drawer except as authorized by this chapter; (c) be payable on demand or at a definite time; and (d) be payable to order or to bearer.
In this case, there is no dispute that elements (a), (c) and (d) have been fulfilled. RaDEC claims, however, that element (b) has not been met because the check was a "conditional instrument" and therefore subject to his defenses.
RaDEC relies heavily on our decision in Bank of America v. Butterfield, 77 S.D. 170, 88 N.W.2d 909 (1958). In that case, the draft in question stated: "Subject to approval of title, pay to the order of Vernon H. Butterfield and Laura E. Butterfield." It is important to note that the phrase "subject to approval of title" immediately precedes the standard phrase, "Pay to the order of." The Bank of America, nevertheless, claimed it was a holder in due course and that the Butterfields should be held liable for the amount of the draft. In affirming the trial court we said:
In addition to other requirements, an instrument to be negotiable `must contain an unconditional promise or order to pay a sum certain in money.' The promise or order to pay money contained in the draft in question is clearly not unconditional. The payment therein ordered is subject to approval of title. Consequently, it is not a negotiable instrument.
Negotiability is determined from the face, the four corners, of the instrument without reference to extrinsic facts. The conditional or unconditional character of the promise or order is to be determined by what is expressed in the instrument itself. Holsonback v. First State Bank, etc., 394 So. 2d 381 (Ala.Civ.App.1980).
RaDEC claims that the check was not a negotiable instrument because of the condition written on its face. Moreover, RaDEC argues that the location of the conditional language in the place usually reserved for "memo" is of little consequence, since the language itself was sufficient to give Bank notice that RaDEC's obligation to pay was conditioned upon Carpet Center's having proved clear title to the material.
The Bank, on the other hand, argues that the instant factual situation can be distinguished from that of Bank of America, supra, because in that case the conditional language, i.e., "subject to approval of title," preceded the words "Pay to the Order of" the Butterfields. Further, a witness for the Bank testified that RaDEC's "conditional" phrase was located at the place reserved for "memos" by the maker or drawer of the check, and as such were not calculated to draw the specific attention of the Bank's personnel in the ordinary day to day processing of checks.
We conclude that the phrase "payee must prove clear title to material" written where it was, did not make the check "conditional" thereby depriving the Bank of its status as a holder in due course. It appears that the notation in the "memo" area of the check is nothing more than a self-serving declaration by RaDEC *410 for its own benefit and record keeping and for informational purposes only. An otherwise unconditional negotiable instrument cannot be rendered conditional by such a device.
What was written by the Minnesota Supreme Court in Eldon's Super Fresh Stores, Inc. v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 296 Minn. 130, 207 N.W.2d 282 (Minn.1973), is pertinent here:
Courts are often confronted with the obligation of applying rules to determine which of two relatively innocent persons must suffer a loss due to misconduct of a third person. The instant case is such a situation. The Minnesota cases dealing with situations such as the one at bar have indicated that the loss must fall on the drawer rather than upon the payee (or other holder) because it was the drawer who created the situation and opportunity for defalcation by its agents.
II
WHETHER BANK TOOK THE CHECK WITHOUT NOTICE OF A CLAIM OR DEFENSE?
In order for the holder of an instrument to attain the status of a holder in due course, he must take the instrument for value, in good faith, without notice that it is overdue or has been dishonored or of any defense against or claim to the instrument on the part of any person, and the instrument must be something other than consumer paper. SDCL 57A-3-302.
As we have already noted, there is no issue concerning whether the Bank took the check for value and in good faith, and it is also clear that the check was not consumer paper. Therefore, it appears the real issue before this court is whether the inscription on the check was such as to put the Bank on notice of a defense against enforcement of the instrument.
A person has notice of a fact when he has actual knowledge of it, has received a notice or notification of it, or from all the facts and circumstances known to him at the time in question he has reason to know that it exists. SDCL 57A-1-201(25).
RaDEC suggests that the Bank had a duty of investigation as a result of its notation on the check. No such duty is imposed by statute or our case law. As the Minnesota Supreme Court noted in Eldon's Super Fresh Stores, Inc., supra:
Notice ... is restricted to actual knowledge of the fact, receipt of notification of it, or knowledge of facts from which the fact in question is inferable and they all exclude the situation in which a person does not have actual or inferable knowledge but merely could discover the fact by reasonable investigation.
It appears that SDCL 57A-3-304(4)(b) is applicable to the instant fact situation:
Knowledge of the following facts does not of itself give the purchaser notice of a defense or claim ...
(b) that it was issued or negotiated in return for an executory promise or accompanied by a separate agreement, unless the purchaser has notice that a defense or claim has arisen from the terms thereof.
In First National Bank of Linton v. Otto Huber & Sons, Inc., 394 F. Supp. 1284 (D.S.D.1975), in applying Section 3-304 the court stated that a person has notice of a claim or defense if "a reasonably prudent person exercising normal commercial standards would immediately be put on notice that there was something very irregular about the terms of the note." We believe that the check in this case was not, under normal commercial standards, so "very irregular" as to put a person on notice that a defense to the instrument existed.
More importantly, the record is absolutely devoid of any evidence tending to establish that Bank had notice or knowledge that the agreement between Carpet Center and RaDEC had not been fully performed. It is not sufficient to constitute notice of a defense that the instrument simply make reference to an executory agreement. It must further be shown that the Bank had, at the time it took the instrument, *411 inferable knowledge that a defense or claim had arisen under the terms of the executory agreement. 11 Am.Jur.2d, Bills and Notes § 460.
In City of Deerfield Beach v. Florida National Bank of Palm Beach County, 35 U.C.C.Rep. 1218, 428 So. 2d 779 (Fla.Ct.App.1983) is found the following pertinent statement:
We see no reason to require banks to scrutinize any check for payor language intended to operate as an accord and satisfaction, compromise or release and then monitor any changes made by the payee in avoidance. Appellant would require banks to determine contractual relationships between payor and payee which are totally outside the contract of the check itself. Such a requirement would be destructive and an unjustified impediment to the flow of commerce.
RaDEC urges that when a bank officer testified that the check "could" be conditional, that this is sufficient to make the check conditional in law. At most this is a mere legal conclusion by a lay person, which is not binding on this court.
It is undisputed that Carpet Center was overdrawn by some $36 at the time the check was presented to Bank. RaDEC contends this should have put Bank on notice that Carpet Center was near insolvency. The relevancy of this contention is questionable. There is nothing in Carpet Center's apparent financial problem to give the Bank any reason to believe that RaDEC would not perform its contract as evidenced by the check in question. The fact that immediate credit was given to Carpet Center for the check in question cannot be considered as notice of defense or even lack of good faith. Various jurisdictions have remained unimpressed by the claim that an existing overdraft in an account gives a bank notice of a possible defense to enforcement of an instrument. Frantz v. First National Bank of Anchorage, 25 U.C.C.Rep. 240, 584 P.2d 1125 (Alaska 1978); Bowling Green Inc. v. State Street Bank and Trust Company, 425 F.2d 81 (1st Cir.1970); St. Paul Fire & Marine Insurance Company v. State Bank of Salem, 412 N.E.2d 103 (Ind.Ct.App.1980).
Accordingly, the judgment of the trial court is affirmed.
FOSHEIM, C.J., and MORGAN and WUEST, JJ., concur.
HENDERSON, J., specially concurs.
HENDERSON, Justice (specially concurring).
Although the inscription on the check does not, under these circumstances, via the majority opinion, defeat the Bank's holder in due course status, certainlyas between the Carpet Center and RaDECthe "memo" is of great significance. Most people in the business world pay by check. A denomination on the check can create an account stated, compromise, accord and satisfaction, or payment in full status. As between the Carpet Center and RaDEC, this is simply not a self-serving declaration or for recordkeeping or for informational purposes. It is a common practice to use a check for a transfer of funds and the payment of bills. Most families do so and banks widely advertise that checks are excellent receipts and proof of payment. I am not trying to impugn the language of the majority opinion but wish to restrict my vote so that I am not, in futuro, married to any language which would preclude me from recognizing binding commercial practices which transpire by the thousands in banks, each day, all over the nation. Nor do I wish to estop businesses or individuals from asserting the validity of memos on their checks.
It is fully appreciated by this author that the wheels of commerce could grind to a quick halt if a bank had the onerous burden of "looking behind" the circulation of all commercial paper and the negotiation of each check. Banks cannot be investigators or mini-tribunals. Holders in due course of a negotiable instrument were historically developed for the avowed purpose of promoting commercial transactions. See generally, Western State Bank of South Bend, Indiana v. First Union Bank & *412 Trust Co. of Winamac, Indiana, 172 Ind.App. 321, 360 N.E.2d 254 (1977); and Bowling Green, Inc. v. State Street Bank & Trust Co., 425 F.2d 81 (1st Cir.1970). However, there are notes and checks bearing conditional characteristics which can destroy negotiability. This is built into the Uniform Commercial Code. See SDCL 57A-3-104(1)(b); Booker v. Everhart, 294 N.C. 146, 240 S.E.2d 360 (1978) (suit on installment note; terms incorporated by reference). In Booker, the North Carolina Supreme Court held that this particular note was not a negotiable note, making reference to the substantive provision which I have just cited.
[T]he conditional or unconditional character of the promise or order is to be determined by what is expressed in the instrument itself. When the instrument itself makes express reference to an outside agreement, transaction or document, the effect on the negotiability of the instrument will depend on the nature of the reference.
Booker, 294 N.C. at 151, 240 S.E.2d at 363. The present case is very difficult for me. Appellate decisions are not always set in jurisprudential cement. We are not visited with simple cases in the Supreme Court very often. Appellate justice is many-sided and multifaceted. All, in academic pursuit, is not black and white. When areas of gray surface, gnawing doubt sets in, and it is nettlesome to a would-be scholar. The case at bar is, perhaps, closer than the majority opinion suggests. Competing values are delicately balanced; we have the "wheels of commerce must go" concept equated against the fact that this particular check contained language which might arouse a great circumspection by the Bank. It is doubtful that the inscription is "highly irregular," a plateau of certitude which was required by Federal District Judge Bogue in First Nat'l Bank of Linton, 394 F. Supp. 1284. In Bank of America, 88 N.W.2d 909, we had the words "Subject to Approval of Title" immediately preceding the words "Pay to the Order of"; here, we have "Payee must prove clear title to material." Both involve "title." Both have reference to an outside matter. One ponders as to the distinction of these two phrases. The language appears stronger in Bank of America to set up a condition; in Bank of America, as the majority opinion points out, it is very significant that the phrase immediately preceded "Pay to the Order of." Divergent authority to the majority's stance is found at 10 Am.Jur.2d Banks § 554, at 527 (1963).
Where a check is presented for payment bearing a condition upon its face, it is the duty of the bank before paying it to make inquiry of the drawer to ascertain whether or not the condition has been performed; payment without such inquiry is at the peril of the bank, so that it will not be protected in charging the payment to the account of the drawer where the condition has not been performed. If the condition has in fact been performed, the absence of inquiry by the bank as to performance does not prejudice it, but in any event, a bank must be circumspect when a conditional check is presented for payment, since the condition renders the instrument nonnegotiable, thereby precluding the presumption of delivery to a holder in due course which prevails as to negotiable paper. (Emphasis supplied mine.)
This American Jurisprudence citation begs, of course, the legal conclusion that the check is a conditional check. And this Court's holding is, of course, that the check at bar is not conditional. It is academically irksome to further note that the Bank admits that it had a choice of either handling the check as a cash item or as a collection item but independently chose, of its own volition, to handle it as a cash item. Another layer of exasperation on academic certainty is tiered when one reads in the transcript that a Bank officer testified that the language could be construed as being conditional and that the language could be construed as a condition.
Thus, I concur specially to elaborate on my vote and, hopefully, to save the integrity of that little note, often written in the lower left-hand corner of a check, which *413 affixes a legal relationship between the parties when the check is tendered and cashed. To an umpire, sometimes it's a strike and sometimes it's a ball. Sometimes it just shaves the plate. You call `em, as "you see's `em." This is a plate shaver for me. Although Professor Rosenberg, in Judicial Discretion of the Trial Court, Viewed from Above, 22 Syracuse L.Rev. 635, 640 (1971), was referring to the review of the executed discretionary powers of a trial judge, there are appellate umpires, also. He observed:
An episode of that kind gives special point to the well-known fable that has three baseball umpires arguing about how they distinguish balls from strikes during the game. The first one says: "It's simple. I call `em as I see 'em." The second one snorts: "Huh! I call `em as they are!" And the third one ends the debate with: "They ain't nothin' `til I call `em!" | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1584990/ | 147 Mich. App. 658 (1985)
382 N.W.2d 842
IN THE MATTER OF RIFFE
Docket No. 83171.
Michigan Court of Appeals.
Decided December 16, 1985.
Christopher S. Boyd, Prosecuting Attorney, and Christopher A. Picard, Assistant Prosecuting Attorney, for petitioner.
O'Farrell, Basner, Smith & Popielarz (by Donald T. Popielarz), for respondent Shirley Riffe.
John L. Denton, for the minor children.
*660 Before: J.H. GILLIS, P.J., and CYNAR and R.L. EVANS,[*] JJ.
CYNAR, J.
Respondent Shirley Riffe appeals as of right from the probate court's order terminating her parental rights in her two minor sons pursuant to MCL 712A.19a(e); MSA 27.3178(598.19a)(e). Respondent Charles L. Riffe has not appealed the order terminating his parental rights. We affirm.
Respondents are the parents of two boys, David Allan Riffe, born in 1983, and Charles L. Riffe, Jr., born in 1982. On August 20, 1984, the Saginaw Valley Department of Social Services (DSS) filed a petition alleging that the probate court had jurisdiction over the minor child David pursuant to MCL 712A.2(b); MSA 27.3178(598.2)(b). On August 24, 1984, a petition was filed alleging that the probate court should exercise jurisdiction over both of the minor children of the parties, Charles, Jr., and David, for the following reasons:
"A. On 05-18-84 David Allan Riffe was diagnosed a `failure to thrive' child.
"B. Said parents failed to bring David in for his scheduled doctor's appointment on 06-04-84 thereby jeopardizing his health and well-being and also failed to reschedule another appointment with the doctor.
"C. David's present height and weight measurements are below the chart for normal development.
"D. David's weight has severely dropped.
"E. On 08-24-84 Charles had a severe urine burn in which both the penis and testicles were red.
"F. On 05-25-80, a petition was filed in Saginaw County Probate Court by Kathryn Morley, alleging that Rosalie Marie McKinnon, said child of Shirley Riffe, was the victim of neglect and, on 07-16-80 Rosalie Marie McKinnon was adjudicated a temporary ward of *661 the Court under neglect jurisdiction and not returned to the care of the mother."
A temporary order of care was entered for David on September 5, 1984, and he was placed in foster care.
On October 8, 1984, a further petition was filed with respect to Charles, Jr., alleging:
"Said parents neglect to provide proper support and necessary care and said child is deprived of his emotional well-being.
"A. On 10-06-84 a physical confrontation occurred within the home over how said child should be disciplined, thereby placing the child in danger.
"B. On 10-06-84 said child was found wearing extremely dirty clothing and had very poor personal hygiene.
"Said home by reason of cruelty is an unfit place for said child to live in.
"C. On 10-06-84 Charles, Jr. was found to have old bruises and fresh welts on the buttocks; lower back, and upper thighs.
An order of temporary care was entered on October 8, 1984, placing Charles, Jr., in the care and custody of the Saginaw Child Receiving Home and he too was eventually placed in foster care.
A hearing was held in probate court on November 28, 1984, on the various petitions. A tentative agreement had been worked out between DSS and the respondents whereby the department would recommend that the probate court take temporary wardship of both children if respondent Shirley Riffe would enter into a parenting agreement with the department with the understanding that she would eventually be allowed to regain custody of the children if her situation improved. Respondent father pleaded no contest to the charges and indicated *662 he would give up any rights he had in the children. Respondent mother indicated, however, that some of the allegations in the petition were false and that she desired to go to trial. At that point, counsel for respondent Charles Riffe pointed out to the court that he had originally represented both parties. Separate counsel had been subsequently appointed for respondent Shirley Riffe because she and respondent Charles Riffe had separated. Counsel for respondent Charles Riffe was allowed to withdraw because of the potential conflict of interest. Therefore, because respondent Charles Riffe was without counsel, the hearing was adjourned to a later date.
The hearing resumed January 22, 1985, with new counsel representing Charles Riffe. As a preliminary matter, counsel for respondent Shirley Riffe moved to strike allegation (F) of the first petition which alleged that a daugther of Shirley Riffe, Rosalie Marie McKinnon, had been made a temporary ward of the court on July 16, 1980, under neglect jurisdiction and had not been returned to the care of her mother. The trial court ruled that allegations of prior neglect of other children of a parent are properly considered by a trial court in neglect cases. The court then proceeded with the adjudicative phase of the juvenile hearing.
Respondent Charles Riffe admitted allegations (A) through (F) of the August 24, 1984, petition and allegations (A) and (B) of the petition filed on November 8, 1984. However, as respondent Shirley Riffe continued to contest the truth of the allegations, several witnesses were called.
Dr. David Booth testified that David, diagnosed as a failure-to-thrive child, had been scheduled for an office visit with him on June 4, 1984, but the appointment had not been kept. When he finally *663 saw 10-month-old David on August 13, 1984, his height and weight were below the 5th percentile and he had received none of the appropriate immunizations normally administered to children. From August 13 to September 19, 1984, David was resident of the child receiving home. Dr. Booth saw David again on September 19, 1984. During the intervening period, David had gained two pounds, 10 ounces, and his weight was at or slightly above the 5th percentile and his height slightly below that percentile. When last seen by Dr. Booth on January 17, 1985, David's weight had increased to the 10th percentile and his height to the 25th percentile. The increases indicated to Dr. Booth that originally David's growth was not within the normal growth range for David, and that since his placement in a more nurturing environment of a foster home he had done extraordinarily well. Dr. Booth concluded that David's failure to thrive was the result of a poor home situation and that a combination of emotional and physical neglect had been responsible for David's failure to thrive.
Officer Cheryl Courtney, a member of the Saginaw Township Police Department, testified that on October 6, 1984, she and two other officers were dispatched to the Riffe home to handle a family dispute. Respondent Charles Riffe and his half-brother David Ozark had been in a fight, apparently because Ozark objected to the way respondent Charles had disciplined Charles, Jr., age 15 months. Both respondents were living in the home along with Joanne Edwards, respondent Charles Riffe's girlfriend, David Ozark, respondent Shirley Riffe's boyfriend, and Lea McKinnon, respondent Shirley Riffe's mother. Officer Courtney testified that Charles, Jr., was bruised and dirty, especially his feet, and all parties, including respondents, *664 agreed that Charles, Jr., would be better off if he were removed from the home. Officer Courtney took the child to Saginaw General Hospital for treatment and made arrangements with probate court officials to take Charles, Jr., to Saginaw County Child Receiving Home.
Dr. Clare Johnson testified that he treated Charles, Jr., at Saginaw General Hospital after he was brought to the hospital by police officers. He reported that Charles, Jr., had several fresh bruises across the buttocks area as well as some older bruises in the same area and on the top portion of the buttocks. The child was not "awfully dirty" when treated, but rather "medium dirty".
Rita Brown, a registered nurse at Saginaw County Child Receiving Home, examined Charles, Jr., on August 21, 1984, the day after he had been removed from the Riffe home. She reported that he had a diaper rash, a rash under his neck and chin, was below weight and length for his age, and had low hemoglobin. She also reported that Charles, Jr., gained three-quarters of a pound in two days and that when he left on August 29, the rash had cleared up.
Marilyn Schreiner, an employee at Mid-Michigan Child Care Center at the First Congregational Church, testified that David came to the center on July 23, 1984. At that time he was 14 months of age. He attended the center for less than a month, only once or twice each week. However, he was so dirty when he first arrived that she bathed him. On July 23, she sent a new bottle home for him since the one he had brought was "black" and the nipple was wrapped with hair, and "there was green slime all over the nipple". She occasionally saw Charles, Jr., who was kept cleaner than David. On August 24, 1984, she observed that David's genital area was covered with a urine burn "like *665 he had been in a Pamper maybe all weekend because he was so raw".
Respondent Shirley Riffe testified that she regularly fed David three meals a day and that she never beat him. However, she objected to the way respondent Charles Riffe disciplined Charles, Jr., although she was afraid to do anything about it for fear he would hit her and place her in the hospital, as he had done in the past. Neither of the parties worked, and their daily routine was to split up the care of the children, respondent Charles Riffe being primarily responsible for the care of Charles, Jr., and respondent Shirley Riffe being primarily responsible for the care of David. Respondent Shirley Riffe testified that the responsibility was split up so that respondent Charles Riffe had more responsibility for the care of Charles, Jr., because taking care of two children was too much for her to handle and because she was trying to learn how to care for the younger child.
David Ozark, the boyfriend of Shirley Riffe, testified that the mother took care of David and that respondent Charles Riffe cared for Charles, Jr. He testified that respondent Shirley Riffe fed the children three times a day when they had money for food. He related the details of the fight he and respondent Charles Riffe had had concerning respondent Charles Riffe's excessive disciplining of Charles, Jr., and that respondent Shirley Riffe was able to care for the two children.
Lea McKinnon testified that she lived with respondent Charles Riffe, his girlfriend Joanne Edwards, her daughter Shirley, and her two grandsons, and that respondent Shirley Riffe fed the children three times a day. A friend of the respondents, Christie Reinhard, also testified that respondent Shirley Riffe regularly fed the children.
Respondent Charles Riffe contested only allegation *666 (C) of the second petition. He testified that the old bruises on Charles, Jr.'s lower back and buttocks were the result of the child's attempting to "break dance" and falling on the floor or a toy. He and respondent Shirley Riffe had decided to divide the responsibility of the children between themselves because they might get divorced. He claimed that respondent Shirley Riffe did not regularly feed David three meals a day. He also indicated that the children would be better off if they were adopted.
After reviewing the testimony, the probate judge determined that the DSS had met its burden of proving each allegation, as amended, by a preponderance of the evidence, and that the allegations were sufficient to bring both David and Charles, Jr., within the jurisdiction of the probate court.
The dispositional phase of the proceeding was conducted February 6, 1985, approximately two weeks after the adjudicative phase. Laura Patterson, a psychologist with Saginaw Psychological Services, testified that respondent Shirley Riffe refused to submit to psychological testing, although it had been scheduled on two separate occasions. The first time, she failed to show up for her appointment, and the second time, she refused to submit to the testing unless she could consult with her lawyer after she found out that the test results could be used in court. Ms. Patterson attempted to contact respondent's attorney, but was unsuccessful.
John Szott, a protective services case worker for the DSS, testified that he initiated the investigation of the Riffe children after being informed by Dr. Booth's office that David Riffe had been diagnosed as a failure-to-thrive child. He recommended that both children be made permanent wards of the court and be placed for adoption. This differed *667 from his earlier recommendation that the children be placed in a temporary wardship. He stated six reasons for recommending that the children be made permanent wards of the probate court: (1) Over the course of his involvement with both Charles and Shirley Riffe, there was little effort on either parent's part to improve their situation or to make an attempt to regain custody of the children. (2) Visitations by the parents were very irregular since August; visitations were scheduled, but not kept, and there were long periods of time with no visitation. (3) Both parents have limited mental functioning. (4) The parents have failed to cooperate in submitting to a psychological evaluation so as to better assist the DSS. (5) The general level of both parents' parenting skills is poor. (6) Respondent father has indicated that he intends to terminate his rights in both children and place them for adoption and that both children are at an ideal age where they could easily be placed on a permanent basis.
Szott indicated he had changed his recommendation from temporary to permanent wardship because of the long pattern of neglect, because Shirley Riffe had made very little effort to improve her situation in spite of her recent signing up for parenting classes, and because Shirley Riffe's visitation with the children was very irregular. He also indicated that the children were young and at an easily-adoptable age and that he felt that adoption was in the children's best interest. Szott testified that both respondents had been the victims of neglect as children and that respondent Shirley Riffe was also a victim of sexual abuse as a young girl. The department had attempted to have both respondents evaluated and had attempted to get both parents to attend parenting classes, but to no avail. The home respondents lived in at the time *668 the children were made temporary wards was dirty, cluttered, and disorganized. Szott described the apartment Shirley Riffe currently resided in with Ozark and her mother as not dirty, appropriately maintained, and not cluttered.
Respondent Shirley Riffe testified that she believed it would take about two weeks of classes for her to become a good parent.
All counsel stipulated that the probate court could take judicial notice of the probate file of Rosalie McKinnon, the daugther of respondent Shirley Riffe.
The court concluded in a lengthy opinion that there was a sufficient basis by clear and convincing evidence to support the termination of the respondents' parental rights and that the best interests of the children warrant and mandate termination.
The respondent (hereinafter, "respondent" refers to appellant Shirley Riffe) submits two issues for our consideration. First, the respondent contends that the probate court did not use the correct burden of proof standard in assuming jurisdiction. We disagree.
The probate court cannot consider termination of parental rights without first properly establishing jurisdiction. In the Matter of Taurus F, 415 Mich. 512, 526; 330 NW2d 33 (1982).
Proceedings in juvenile court are of two general types: adjudicative and dispositional. JCR 1969, 8.1 and 8.3 [now MCR 5.908(A) and 5.908(C)] describe the two types of proceedings:
"(A) Adjudicative Phase. The adjudicative phase determines whether the child comes within the court's jurisdiction under MCLA 712A.1 et seq.; MSA 27.3178(598.1) et seq., as alleged in the petition. There is a right to jury trial.
*669 "(B) Dispositional Phase. The dispositional phase determines measures to be taken by the court with respect to the child and adults properly within its jurisdiction if the court has determined at the adjudicative phase that the child comes within the statute. There is no right to jury trial." JCR 1969 8.1. 403 Mich. lxvi.
The admissibility of evidence and the standard of proof vary according to the type of proceeding involved.
"(A) Adjudicative Phase. Absent a valid plea in confession, only competent, relevant, and material evidence is admissible at the adjudicative phase. In a case involving an offense by a child, the rules of evidence for a criminal proceeding and the standard of proof beyond a reasonable doubt apply. In a case involving an offense against a child, the rules of evidence for civil proceeding and the standard of proof by a preponderance of the evidence apply.
"(B) Dispositional Phase. In the dispositional phase only relevant and material evidence may be considered. Clear and convincing evidence is required to terminate parental rights." JCR 1969, 8.3. 403 Mich. lxvii. (Emphasis added.)
The probate court assumed jurisdiction after finding by a preponderance of the evidence that the material allegations in the petitions were true. It is argued that reliance on the preponderance of the evidence standard was error. Respondent, relying on In the Matter of Kurzawa, 95 Mich. App. 346; 290 NW2d 431 (1980), contends that the probate court could only assume jurisdiction using a "clear and convincing evidence" standard. The Kurzawa Court stated that "[t]he state carries the burden of proving the need for the court's exercising jurisdiction by clear and convincing evidence". 95 Mich. App. 354. As authority, the Kurzawa Court cited In the Matter of LaFlure, 48 Mich App *670 377; 210 NW2d 482 (1973), lv den 390 Mich. 814 (1973), and JCR 1969, 8.3(B) [now MCR 5.908(C)].
We believe that this Court's reliance on In the Matter of LaFlure and JCR 8.3(B) in Kurzawa, for the proposition that the state carries the burden of proving the need for the court's exercising jurisdiction by clear and convincing evidence, was incorrect. The court rule clearly states that during the adjudicative phase the court determines whether or not the child comes within the court's jurisdiction, and that the burden of proof is that of a preponderance of the evidence. A close reading of In the Matter of LaFlure reveals that in that case this Court was concerned with the dispositional phase, in which the court rule clearly provides that the state must prove by clear and convincing evidence that termination is warranted. See also In the Matter of Campbell, 129 Mich. App. 780, 785; 342 NW2d 607 (1983).
It is also noted that in Kurzawa the parents of the minor child initially sought the resources available through DSS to help their problem child. The factual allegations by the Kurzawas in their initial petition referred to the delinquency provisions of the probate code and not the neglect portions. Jurisdiction under the statute must be based on evidence of parental neglect and not on delinquency. Neither the initial nor later petitions alleged any neglect by the Kurzawas. Since the Kurzawa Court held that the probate court erred in assuming jurisdiction and therefore the proceedings were void ab initio, determining the burden of proof standard in exercising jurisdiction to be clear and convincing evidence was unnecessary in that case.
The respondent also contends that the petitioner did not prove by clear and convincing evidence *671 that the termination of parental rights was warranted. We disagree.
The appropriate standard of review in cases involving termination of parental rights is whether the findings of the probate court are clearly erroneous. In re Cornet, 422 Mich. 274, 277; 373 NW2d 536 (1985). A finding is "clearly erroneous" when, although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been made. Mazur v Blendea, 413 Mich. 540, 547; 321 NW2d 376 (1982); Tuttle v Dep't of State Highways, 397 Mich. 44, 46; 243 NW2d 244 (1976).
The statute pursuant to which the trial court terminated respondent's parental rights is MCL 712A.19a(e); MSA 27.3178(598.19a)(e). Section 19a(e) reads in relevant part as follows:
"Sec. 19a. Where a child remains in foster care in the temporary custody of the court following the initial hearing provided by section 19, the court may make a final determination and order placing the child in the permanent custody of the court, if it finds any of the following:
* * *
"(e) The parent or guardian is unable to provide a fit home for the child by reason of neglect."
The state bears the burden of proving by clear and convincing evidence that termination of parental rights is warranted. JCR 1969, 8.3(B) [now MCR 5.908(C)(2)], In the Matter of Bidwell, 129 Mich. App. 499, 504; 342 NW2d 82 (1983); In the Matter of LaFlure, supra.
Although the amount of neglect necessary to justify termination of parental rights under section 19a(e) is not capable of precise or exact definition, *672 the entry of an order taking permanent custody due to neglect must be based upon testimony of such a nature as to establish or seriously threaten neglect of the child for the long-run future. Fritts v Krugh, 354 Mich. 97, 114; 92 NW2d 604 (1958); In the Matter of Bidwell, supra, p 505. The proper standard is whether the parent has been shown by clear and convincing evidence to be unfit and unable to become fit within a reasonable period of time. MCL 712A.19a; MSA 27.3178(598a); In the Matter of Atkins, 112 Mich. App. 528, 541; 316 NW2d 477 (1982), lv den 413 Mich. 912 (1982).
After reviewing the record of the instant proceeding, we are not left with a definite and firm conviction that the trial court made a mistake in terminating the parental rights of respondent Shirley Riffe. The minor child David was removed from the home after being diagnosed by a physician as being a failure-to-thrive child. The minor child Charles, Jr., was removed from the home as a result of a police call to the family home wherein his father and mother's boyfriend were engaged in a fistfight over the father's disciplining of the child. At that point Charles, Jr., was bruised and dirty and was removed from the home.
Another child of respondent Shirley Riffe, Rosalie McKinnon, had been made a temporary ward of the court in 1980. At that time, respondent Shirley Riffe submitted herself to psychological evaluation, and attempts were made at counseling to improve respondent's parenting skills. Eventually, however, the DSS recommended that Rosalie be placed with the father. In 1982, the child was discharged from probate jurisdiction, with permanent custody in the father's care. With respect to the father's care of Rosalie, the psychological report indicated that respondent "will most likely *673 always be a minimal parent, without mental ability to change".
When difficulties arose with the care of Charles, Jr., and David, the DSS provided respondent with the opportunity to submit to psychological testing and counseling. Respondent Shirley Riffe refused to submit to psychological testing and signed up for parenting classes only a week before the final dispositional hearing was scheduled. When asked how long she felt she should attend parenting classes in order to become a fit parent, she responded it would take her "about two weeks". She also testified that the parties had split up the care of the children partially because taking care of two children was too much for her to handle.
The trial court found that the mother has a long history of neglectful behavior toward her children and that she has done very little to improve her parenting skills. We believe that the state met its burden of proving by clear and convincing evidence that the children were subjects of continuing neglect and that there is every indication that the pattern of neglectful behavior will continue and will not be remedied at any time in the foreseeable future. Therefore, the decision of the trial court that the children must be removed from the parental home and that respondent's parental rights be terminated permanently is not clearly erroneous.
Affirmed.
NOTES
[*] Recorder's Court judge, sitting on the Court of Appeals by assignment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585015/ | 147 Mich. App. 487 (1985)
382 N.W.2d 804
PETOSKEY
v.
KOTAS
Docket No. 81013.
Michigan Court of Appeals.
Decided December 3, 1985.
Thomas Peralta, for plaintiff.
Max D. McCullough, for defendant.
Before: GRIBBS, P.J., and T.M. BURNS and M. WARSHAWSKY,[*] JJ.
PER CURIAM.
Defendant appeals from an "order amending judgment of divorce and setting amount of child support arrearages" which increased defendant's child support obligations from $25 per week per child to $40 per week per child.
On December 22, 1980, a default judgment of divorce was entered in the trial court which ordered defendant to pay child support of $25 per week per child. Plaintiff and defendant have four children so the weekly child support payment totalled $100. This amount was $80 per week less than the friend of the court's recommendation. Approximately three years later, plaintiff filed a motion alleging that defendant refused to make *489 support payments and failed to report raises in his income. This matter was referred to the friend of the court which concluded that the child support should remain at the same amount. Both defendant and plaintiff filed written objections to the friend of the court's recommendation. Plaintiff argued that the child support payments should be increased and defendant argued that they should be decreased. The circuit court then referred this matter back to the friend of the court for further recommendation in light of the parties' objections. The friend of the court then recommended that defendant should pay child support in the sum of $172 per week. Plaintiff accepted this recommendation, but defendant objected arguing that plaintiff failed to present any proofs as to any increased need or change in circumstances with the minor children and that the friend of the court's recommended minimum support schedule should not be used without other proofs. The trial court granted plaintiff's motion for acceptance following brief oral argument. Defendant objected to entering the order, and the trial court stated: "Your client told me that he takes home $350 per week". When defense counsel did not disagree with this fact, the court denied the request for an evidentiary hearing and entered an order increasing child support to $150 per week. The terms of the final order required defendant to pay $40 per week per child.
Defendant now appeals as of right from the circuit court's decision. It is well-settled that the trial court has the discretion to modify child support orders, including the discretion to cancel arrearages retroactively. Ozdaglar v Ozdaglar, 126 Mich. App. 468, 473; 337 NW2d 361 (1983). Before a court can modify a child support provision contained in a divorce decree, either parent or the friend of the court must petition for the modification. *490 McCarthy v McCarthy, 74 Mich. App. 105; 253 NW2d 672 (1977). If the parties fail to consent to the modification and there exists a factual dispute concerning the circumstances relating to the petition for modification, the court is obliged to hold an evidentiary hearing. Cochran v Buffone, 137 Mich. App. 761, 766; 359 NW2d 557 (1984). The trial court must consider all relevant factors in determining whether there has been a sufficient change in circumstances to justify modification of the child support provisions. Jacobs v Jacobs, 118 Mich. App. 16; 324 NW2d 519 (1982). In reaching its determination, the trial court may consider the report of the friend of the court, but the report is inadmissible as evidence unless all the parties agree to the contrary. McCarthy, supra. Review of the trial court's decision is de novo; however, great weight is to be given to the trial judge's finding of fact. Krachun v Krachun, 355 Mich. 167; 93 NW2d 885 (1959); McCarthy, supra.
We feel that the trial court erred in denying defendant's request for an evidentiary hearing. The defendant objected to the friend of the court's recommendation, claiming that there has been no changed circumstances since the divorce judgment was entered. Plaintiff argued that there was a sufficient change in circumstances and the friend of the court accepted plaintiff's argument. Despite this, the trial court seemed to be solely concerned with defendant's income, noting that there was no dispute as to that amount. We note, however, that defendant's income had decreased approximately $20 per week since the judgment granting the divorce was entered. In McCarthy, supra, p 109, this Court stated:
"There is no question that the trial court erred in its modification order of February 26, 1975, both procedurally *491 and substantively. The order was made without a hearing and there was no agreement expressed or implied to allow the court to utilize the Friend of the Court's recommendation. [Citations omitted.] Additionally, the recommendation was based totally upon the fact of defendant's increase in salary. All relevant factors are to be considered in determining whether there has been a sufficient change in circumstances. [Citations omitted.] The isolated consideration of income is error. [Citations omitted.]"
Likewise, in the instant case, the trial court erred in relying solely on defendant's income as a basis for increasing child support. The trial court should have granted defendant's request for an evidentiary hearing on this matter. We therefore remand for a hearing in accordance with Cochran, supra, pp 767-768. We do not retain jurisdiction.
NOTES
[*] Circuit judge, sitting on the Court of Appeals by assignment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1585010/ | 641 So. 2d 1086 (1994)
STATE of Louisiana, Appellee,
v.
Orland D. STEWART, Appellant.
No. 26168-KA.
Court of Appeal of Louisiana, Second Circuit.
August 17, 1994.
*1087 Kurt J. Goins, Asst. Indigent Defender, Shreveport, for appellant.
Richard Ieyoub, Atty. Gen., Baton Rouge, Paul J. Carmouche, Dist. Atty., Ronald R. Inderbitzen, Asst. Dist. Atty., Shreveport, for appellee.
Before HIGHTOWER, VICTORY and WILLIAMS, JJ.
WILLIAMS, Judge.
The defendant, Orland D. Stewart, was indicted by a grand jury for the second degree murder of Darlene Johnson and the attempted second degree murder of Stephanie Proctor. After a jury trial, the defendant was found guilty of second degree murder, a violation of LSA-R.S. 14:30.1 and aggravated battery, a violation of LSA-R.S. 14:34. He was sentenced to life imprisonment at hard labor without benefit of parole, probation or suspension of sentence for the second degree murder, which is to be served concurrently with a two-year hard labor sentence for the aggravated battery conviction.
On appeal, defendant relies on four assignments of error to obtain a reversal of his *1088 convictions and sentences. Finding no merit to any of the assignments, we affirm.
FACTS
On November 10, 1992, the defendant returned to Shreveport, Louisiana, from Phoenix, Arizona, where he had been living and working. He visited Stephanie Proctor, with whom he previously had a relationship. Proctor and the defendant had one daughter named Cree. During the earlier part of the day, defendant drove Proctor and her two oldest children to a shopping mall.
Afterwards, defendant left the home where Proctor lived with her grandmother, Ms. Darlene Johnson, and returned later that evening to find Proctor with Norris Frazier, her current boyfriend. No altercation resulted at this point, but Ms. Johnson would not allow the defendant to enter the house. Proctor went outside and spoke with the defendant. He then left the house.
Approximately thirty minutes later, the defendant returned to the house and knocked on the door. Ms. Johnson answered the door, but she again refused to allow the defendant to come inside. When the defendant was leaving, Frazier decided to go outside to talk with him in an attempt to make peace. Proctor warned Frazier not to go outside but the defendant told her to let Frazier come outside to talk. When Frazier attempted to shake the defendant's hand, the defendant pulled a knife from his pants and attempted to stab Frazier. Unable to catch the fleeing Frazier, the defendant ran up to Proctor, who was standing on the front porch, and stabbed her on the arm.
In response to the defendant's attack, Proctor ran inside the house and locked the front door. The defendant smashed the door open, breaking its glass and sustaining cuts to his face and arm. He chased Proctor through the house with the knife drawn, but she was able to escape through the back door. The defendant then confronted Ms. Johnson and stabbed her several times. As the defendant left the scene, he punctured two of the tires on Frazier's car and broke one of its windows. An emergency unit took Ms. Johnson to a nearby hospital where she was pronounced dead on arrival. Shortly thereafter, law enforcement officers located the defendant at a relative's residence and took him into custody.
DISCUSSION
ASSIGNMENTS OF ERROR NOS. 1 and 3(A):
By these assignments, the defendant contends the trial court erred in finding that Keoni King, the four-year-old daughter of Stephanie Proctor, was competent to testify. He also contends that because of this erroneous ruling, the trial court should have granted his motion for a new trial. In sum, the defendant argues that the totality of the child's testimony did not meet the "proper understanding test" set forth in LSA-C.E. Art. 601; State v. Foy, 439 So. 2d 433 (La. 1983); State v. Bennett, 591 So. 2d 1193 (La. App. 1st Cir.1991), writ denied, 594 So. 2d 1315 (La.1992); and State v. Bean, 582 So. 2d 947 (La.App. 2d Cir.1991), writ denied, 586 So. 2d 567 (La.1991).
Every person of proper understanding is competent to be a witness except as otherwise provided by legislation. LSA-C.E. Art. 601. The competency of a person to be a witness is a question of law to be determined by the trial court and not a factual matter for the jury to decide. LSA-C.E. Art. 104(A); State v. Peters, 441 So. 2d 403 (La.App. 4th Cir.1983).
Proper understanding, not age, is the single general test of witness competency. LSA-C.E. Art. 601, Comment (b); State v. Bean, supra. The previous rules set forth in LSA-R.S. 15:469 for determining the competency of witnesses under 12 years of age were abandoned with the passage of the Code of Evidence. See LSA-C.E. Art. 601, Comment (d).
A child's sometimes hesitant or unresponsive answers do not necessarily indicate incompetency. State v. Humphrey, 412 So. 2d 507 (La.1982); State v. Sampson, 480 So. 2d 952 (La.App. 2d Cir.1985). Instead, such actions may be a part of the child's overall demeanor caused by the child being simply unfamiliar with the courtroom experience. *1089 State v. Sharp, 338 So. 2d 654 (La. 1976); State v. Sampson, supra.
Great deference is to be given to a trial court's determination of competency because of its opportunity to observe the witness. Such a determination is not to be overturned unless manifest error is shown. State v. Crandell, 604 So. 2d 123 (La.App. 2d Cir.1993); State v. Bean, supra.
After reviewing the record, we find no manifest error in the trial court's decision to allow this witness to testify. Out of the presence of the jury, counsel for the state and the defense and the trial judge examined the witness to determine her competency to testify. At the conclusion of the predicate, the trial court ruled that although the child had been uncomfortable and afraid during her testimony the day before, her demeanor and answers indicated she was somewhat more relaxed and could answer counsels' questions. Defense counsel objected to this ruling stating that he felt the child was "borderline on [the issue of] competence."
It is obvious that the witness was timid and confused by the courtroom proceeding. However, the child indicated that she understood the difference between the truth and a lie. She seemed to have the intelligence that one of a similar age and under similar circumstances would possess.
We also agree with the trial court's ruling on the defendant's motion for a new trial. Assuming arguendo that the witness' testimony was improperly admitted, the trial court was correct in concluding that this witness' testimony was merely corroborative and cumulative in nature. The record reflects that prior to the child's testimony, both Roy Clay and Norris Frazier testified the child had informed them immediately after the offense that she had seen the defendant stab the victim. Moreover, the defendant did not contest the fact that he had stabbed the victim. His entire defense was that he acted with "sudden passion" or "heat of blood" such as to reduce the offense from second degree murder to manslaughter. Accordingly, in light of the cumulative nature of the witness' testimony, we find no reversible error in the trial court's ruling on the competency of the witness or on the defendant's subsequent motion for a new trial based on this ground.
These assignments lack merit.
ASSIGNMENTS OF ERROR NOS. 2 and 3(B):
By these assignments, the defendant challenges as error the trial court's denial of his motion for a new trial and post-verdict motion for modification of verdict because the evidence supported a verdict of manslaughter rather than a verdict of second degree murder.
The refusal to grant a motion for new trial based on the ground that the verdict is contrary to the law and the evidence is not subject to appellate review. LSA-C.Cr.P. Art. 858; State v. Bartley, 329 So. 2d 431 (La.1976); State v. Combs, 600 So. 2d 751 (La.App. 2d Cir.1993), writ denied, 604 So. 2d 973 (La.1993).
LSA-C.Cr.P. Art. 821(B) provides that a motion for post-verdict judgment of acquittal, or modification of verdict, shall be granted only if the court finds that the evidence, viewed in a light most favorable to the state, does not reasonably permit a finding of guilty. This is a question of legal sufficiency. State v. Combs, supra.
Under Jackson v. Virginia, 443 U.S. 307, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979), the proper standard of appellate review for a sufficiency of evidence claim is whether, after reviewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime proven beyond a reasonable doubt. State v. Bellamy, 599 So. 2d 326 (La.App. 2d Cir.1992), writ denied, 605 So. 2d 1089 (La.1992).
The Jackson standard is applicable in cases involving both direct and circumstantial evidence. An appellate court reviewing the sufficiency of evidence in such cases must resolve any conflict in the direct evidence by viewing that evidence in the light most favorable to the prosecution. When the direct evidence is thus viewed, the facts established by the direct evidence and inferred from the circumstances established by that *1090 evidence must be sufficient for a rational trier of fact to conclude beyond a reasonable doubt that defendant was guilty of every essential element of the crime. State v. Sutton, 436 So. 2d 471 (La.1983); State v. Lott, 535 So. 2d 963 (La.App. 2d Cir.1988).
LSA-R.S. 14:31(A)(1) states in pertinent part:
A homicide which would be murder under... Article 30.1 (second degree murder), but the offense is committed in sudden passion or heat of blood immediately caused by provocation sufficient to deprive an average person of his self-control and cool reflection. Provocation shall not reduce a homicide to manslaughter if the jury finds that the offender's blood had actually cooled, or that an average person's blood would have cooled, at the time the offense was committed.
"Sudden passion" or "heat of blood" are not elements of the crime of manslaughter; rather, they are mitigatory facts in the nature of a defense which exhibit a degree of culpability less than that present when the homicide is committed without them. State v. Lombard, 486 So. 2d 106 (La.1986); State v. Ruff, 504 So. 2d 72 (La.App. 2d Cir.1987), writ denied, 508 So. 2d 64 (La.1987). Therefore, a defendant who establishes by a preponderance of the evidence that he acted in "sudden passion" or "heat of blood" is entitled to a manslaughter verdict. Where such proof is sufficient, a second degree murder verdict is inappropriate. State v. Lombard, supra; State v. McCray, 621 So. 2d 94 (La. App. 2d Cir.1993).
The defendant claims he acted in anger and jealousy triggered by Proctor's apparent rejection. In support of this claim, the defendant points to his statement or "mumbling," made shortly after his arrest, as indicative of his true feelings: "If she would have only told me she didn't want me, none of this would have happened." Defendant argues this spontaneous, unsolicited utterance, when coupled with his rendezvous with Proctor and the two children at the mall that day, undermines any claim that his relationship with Proctor was over.
The defendant admits it may be argued that he had time to "cool off" during the 30-35 minute interval between his second and third visits. However, he argues the true provocation was Frazier's approach to shake the defendant's hand as the defendant was withdrawing from any conflict by leaving the premises. The defendant asserts that Frazier's act of following him to the gate and attempting to shake his hands ignited his anger and was the final link in a chain of events, which resulted in a rage or frenzy that would place this killing squarely within the "sudden passion" category. Defendant submits that his initial pursuit of Frazier, his smashing his way into the house despite his own cuts from the glass, and the damage to Frazier's car are further evidence of his rage, frenzy or "sudden passion." Apparently, the defendant also argues that the victim's act of twice refusing him entry into the home, coupled with the above events, was sufficient provocation to deprive him of his self-control.
Contrary to defendant's assertions, the record shows that the defendant not only knew that Proctor was dating Frazier, but he also knew that Frazier was at Proctor's home when he returned for the third time. On his third visit, defendant was armed with a knife which was described as a "butcher knife," rather than a pocket knife ordinarily carried on the person. He had ample time to reflect on the termination of the relationship, Proctor's new relationship with Frazier, and his banishment from the Johnson home before he returned to the scene for the final time.
Provocation for killing is a question of fact for the jury. State v. Knowles, 598 So. 2d 430 (La.App. 2d Cir.1992). The verdict of guilty of second degree murder in this case reflects that the jury concluded the events of the day, culminating with Frazier's attempt to shake defendant's hand, were not provocation sufficient to deprive an average person of his self-control and cool reflection.
Under the facts of this case, a rational trier of fact could have concluded that the developments of the day were not provocation sufficient to deprive an average person of his self-control to the extent he would commit a homicide. Accordingly, the trial *1091 court did not err in its denial of the post-verdict motion for modification of verdict.
These assignments lack merit.
ASSIGNMENT OF ERROR NO. 4:
By this assignment the defendant requests this Court to review the record for error patent. We have reviewed the record and have found none.
CONCLUSION
For the reasons assigned, defendant's convictions and sentences are affirmed.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1583652/ | 427 So. 2d 1341 (1983)
Janice Murphy HART, Plaintiff-Appellant & Defendant-in-Reconvention,
v.
Lloyd D. HART, Defendant-Appellant & Plaintiff-in-Reconvention.
No. 15212-CA.
Court of Appeal of Louisiana, Second Circuit.
February 22, 1983.
Writ Denied April 15, 1983.
Blackwell, Chambliss, Hobbs & Henry by Sam O. Henry, III, West Monroe, for plaintiff-appellant & defendant-in-reconvention.
*1342 Michael S. Ingram, Monroe, for defendant-appellant & plaintiff-in-reconvention.
Before JASPER E. JONES, SEXTON and NORRIS, JJ.
SEXTON, Judge.
Lloyd D. Hart appeals a trial court judgment decreeing Janice Murphy Hart to be his good faith putative spouse. He also contests the decree of the trial court which awarded the custody of Daniel Wade Hart, a five year old child born of the Hart union, to Mrs. Hart. We affirm.
The events involved in this case span almost two decades. In 1963 Mrs. Hart, then Janice Murphy, married James W. Lowery. Elizabeth Christian "Chris" Lowery was born of the marriage in 1964. The two spouses ceased living together in about February of 1967. Sometime after August 9, 1967, Mrs. Hart, (then Mrs. Lowery) went to El Dorado, Arkansas, for the sole purpose of obtaining a divorce. On September 29, 1967, her Arkansas attorney filed a petition for divorce. On November 1, 1967, the Chancery Court of Union County, Arkansas, granted the divorce. Neither Mrs. Hart nor her witness appeared before the court and the case was decided on affidavits.
In 1967, Mrs. Hart met Mr. Hart. The two were married on January 3, 1974, in Marshall, Texas. After a brief time they began living together in Ouachita Parish at the Magnolia Motel which is owned by Mr. Hart. Daniel Hart, the subject of the custody action, was born on July 18, 1977. Mr. Hart subsequently bought a home on Love Road into which Mrs. Hart moved in November of 1978 after extensive renovations were completed. Mr. Hart remained at the motel. It appears that the already deteriorating marriage had essentially collapsed at about this time.
On August 12, 1981, Mrs. Hart filed a petition for separation from Mr. Hart on grounds of cruel treatment. In addition, she requested custody of Daniel and alimony and child support. Mr. Hart filed a reconventional demand contending that the marriage was a nullity because of infirmities in the Arkansas divorce Mrs. Hart obtained from her first husband. Mr. Hart alleged that Mrs. Hart contracted the marriage with him in bad faith and was therefore not entitled to receive any civil effects from the marriage between them. He also sought custody of the child.
The custody issue was originally litigated by rule in late August of 1981. Mr. Hart apparently had physical control of the child at that time, but by judgment dated September 10, 1981, the trial court transferred custody of Daniel from Mr. Hart, then age 64, to Mrs. Hart, then age 39, in "the best interests of the child."
In written reasons for this judgment the trial court made a number of significant observations. The court noted that Mr. Hart had not seen or talked to a daughter of his from a previous marriage for a period of 30 years. The court observed that Mrs. Hart had conceived a child out of wedlock approximately 18 years ago, and that Mrs. Hart had given up the child for adoption.
The court further observed that Mr. Hart continued to live at the motel subsequent to the purchase of the home on Love Road, although he did occasionally visit the Love Road residence. Mrs. Hart worked at the motel during the day, and returned to the Love Road residence at night. The child, similarly, stayed at the motel during the day, and returned home with his mother at night.
There was a dispute as to when Mr. Hart gained physical control of the child. Mr. Hart asserted that he obtained physical control of the child in April of 1980. Mrs. Hart adamantly contended that Mr. Hart's control did not occur until February of 1981 when she became ill. Notwithstanding this factual dispute, the trial court stated that while in the physical custody of the father the child ate all his meals in various restaurants and had no association with other children. His only associates were his father's friends. Although the child was nearing school age, the father was evasive and non-committal about school plans for the child. The father was found to be possessive and unwilling to allow the child to spend time with his mother.
*1343 The trial from which this appeal was taken began April 2, 1982, and the cause was concluded by written reasons filed April 22 and a judgment signed April 30, 1982. The major issues at the trial, aside from the validity of the Arkansas divorce, concerned the contention that Mr. Hart harassed his wife, the allegation that Mrs. Hart was a poor housekeeper, and the charge that Mrs. Hart and her daughter Chris had beaten the child. Mr. Hart introduced photographs he took of the Love Road home on January 10, 1982, in order to support the factual allegation of poor housekeeping. Mr. Hart also introduced photographs taken of the child showing a minor injury to the eye.
Mrs. Hart contended that the photographs depicting an unkempt premises were staged and asserted that Daniel had injured his eye by tripping and falling. Chris Lowery supported her mother's assertions in this regard. Mrs. Hart further asserted that the motel owned by Mr. Hart and at which he lives was used for immoral purposes.
The trial was characterized by the presentation of directly conflicting testimony on several issues. It is apparent, however, that the marriage was marred by violent arguments between the spouses.
At the conclusion of the trial, the court held that the Arkansas court had no jurisdiction to divorce Mrs. Hart from her first husband.[1] The trial court declared that Mrs. Hart had never been legally divorced from her first husband, and that her marriage to Mr. Hart was therefore a nullity. The court noted that the invalid divorce decree which allegedly dissolved Mrs. Hart's first marriage was granted in 1967, and that Mrs. Hart did not marry Mr. Hart until 1974. The trial court obviously inferred from these facts that Mrs. Hart had not gone to Arkansas for the purpose of obtaining a speedy divorce and facilitating a subsequent marriage. The court noted that Mrs. Hart was unable to testify as to exactly when she went to Arkansas, when she left, or whether she had obtained a copy of the judgment. However, the court felt that she was relying on her attorney there to handle the proceedings properly and therefore was in good faith in contracting the marriage with Mr. Hart. The court thus held her to be a putative spouse entitled to receive the civil effects of her marriage to Mr. Hart and awarded Mrs. Hart alimony.
In awarding custody of the child Daniel to Mrs. Hart, the court noted the high level of animosity between the parties and pointed out that each spouse was using the child to hurt the other. The court took note of the photographs showing the residence in an unkempt situation and noted Mrs. Hart's contention that Mr. Hart had deliberately caused the condition depicted. The court did not specifically resolve this conflict, but implicit in the court's ruling is an acceptance of Mrs. Hart's position in this regard.
The trial court concluded by finding that, while Mrs. Hart's situation was not ideal, she should still retain custody thus strongly implying that her environment was superior to the situation at Mr. Hart's motel.
Mr. Hart now appeals asserting that the trial court erred in finding that Mrs. Hart married him in good faith, and also erred in awarding custody of the child to Mrs. Hart. These assignments form the two issues for our consideration in this appeal.
As to the first issue concerning putative effects, we note that the trial court's ruling that the marriage is a nullity is not before us as Mrs. Hart has not appealed or answered the appeal. We therefore assume the correctness of that ruling and proceed directly to the question of the correctness of the trial court's determination that Mrs. Hart contracted her marriage to Mr. Hart in good faith and is thus entitled to the *1344 effects thereof as per LSA-C.C. Arts. 117 and 118.[2]
The basic principles with respect to good faith under these circumstances were succinctly noted by Judge Price in Galbraith v. Galbraith, 396 So. 2d 1364, at 1368, (La.App.2d Cir.1981):
"Good faith in the context of this putative marriage doctrine is defined as an honest and reasonable belief that the marriage was valid and that no legal impediment to it existed. See Funderburk v. Funderburk, 214 La. 717, 38 So. 2d 502 (1949). The question of whether a party is in good faith in entering into an invalid bigamous marriage is a subjective inquiry, Succession of Marinoni, 183 La. 776, 164 So. 797 (1935), and depends on all the circumstances presented in any given case. Succession of Chavis, 211 La. 313, 29 So. 2d 860 (1947)."
Thus the good faith analysis called for in this context although incorporating objective elements of reasonableness is essentially a subjective one. Furthermore, good faith is a factual question and this is another of those circumstances where the finding of the trial court is entitled to great weight. Gathright v. Smith, 368 So. 2d 679 (La.1978): Galbraith, supra.
The trial court here was obviously influenced by the seven year delay between the Arkansas divorce and this marriage to Mr. Hart. There is nothing in the record to indicate that Mrs. Hart had an ulterior motive in attempting to procure the Arkansas divorce. The trial court specifically found that Mrs. Hart, as a lay person, was reasonable in relying on her attorney to effect her divorce. Succinctly stated, the facts of this case present a wife who went to Arkansas, and in accordance with Arkansas law, obtained a divorce by summary proceeding. There is nothing in the record to indicate any knowledge on her part of the infirmity in that divorce. She did not avail herself of the expeditious nature of the Arkansas procedure in order to remarry. Under these circumstances we believe the trial court had ample reason to find that Mrs. Hart possessed "an honest and reasonable belief that the marriage was valid and that no impediment to it existed." Galbraith, supra, at 1368. We agree that Mrs. Hart had no actual knowledge of the infirmity of her previous divorce and that Mrs. Hart was therefore in good faith in marrying Mr. Hart. We wish to make it clear, however, that reliance on one's attorney does not always constitute good faith in circumstances such as these. We merely hold that under the cumulative mix of facts present in this case including the seven year lapse between the invalid divorce decree and Mrs. Hart's remarriage the trial court was not clearly wrong in finding that Mrs. Hart contracted her second marriage in good faith.
With respect to the custody of the child Daniel, it has been too often stated to require citation that the trial court's determination in this regard is also entitled to great weight. It is not to be disturbed absent a showing of an abuse of discretion. Most of the evidence of the circumstances pertinent to custody was apparently taken on the original rule. That ruling was not appealed, and as we previously noted, the issues relative to custody at this trial revolved mainly around Mrs. Hart's housekeeping and whether she had abused the child. The testimony was in conflict in this regard and implicit in the trial judge's determination is his acceptance of Mrs. Hart's version of these circumstances. The trial court was obviously influenced by the disparity in ages. The court furthermore preferred Mrs. Hart's residential environment to the motel environment provided by Mr. *1345 Hart. We find no abuse of discretion in these determinations.
For the reasons assigned the judgment appealed from is affirmed at appellant's cost.
AFFIRMED.
NOTES
[1] Our learned brother at the trial level held, correctly we think, that the divorce decree was invalid. The Arkansas court did not have the requisite jurisdiction to render a divorce. Mrs. Hart was never domiciled in Arkansas, nor did she meet the Arkansas residency requirements.
Thus, the Arkansas court never had jurisdiction over her status. Williams v. North Carolina, 325 U.S. 226, 65 S. Ct. 1092, 89 L. Ed. 1577; Hampson v. Hampson, 271 So. 2d 898 (La. App.2d Cir.1972); Andries v. Andries, 398 So. 2d 123 (La.App.3d Cir.1981).
[2] Art. 117. Civil effects of putative marriage
The marriage, which has been declared null, produces nevertheless its civil effects as it relates to the parties and their children, if it has been contracted in good faith.
Art. 118. Persons entitled to civil effects of putative marriage
If only one of the parties acted in good faith, the marriage produces its civil effects only in his or her favor, and in favor of the children born of the marriage. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1582749/ | 976 F. Supp. 124 (1997)
Larry FORBES, d/b/a Surgical Specialist
v.
JOINT MEDICAL PRODUCTS CORP. and Johnson and Johnson Professional, Inc.
No. 3:95cv1980(AHN).
United States District Court, D. Connecticut.
July 24, 1997.
Richard Jacobs, Jacobs, Jacobs & Shannon, New Haven, CT, Andrew Kasmen, Mitchell Kramer, M. Kramer & Associates, Jenkintown, PA, for Plaintiff.
Gary MacMillan, Scott Lucas, MacMillan & Lucas, Stamford, CT, for Defendants.
RULING ON DEFENDANTS' PARTIAL MOTION FOR SUMMARY JUDGMENT
NEVAS, District Judge.
The plaintiff, Larry Forbes ("Forbes"), brings this suit against the defendants, Joint Medical Products Corporation ("JMPC") and Johnson and Johnson Professional, Inc. ("J & J"), for violation of the Connecticut Franchise Act, Conn. Gen.Stat. §§ 42-133e-h (Count One), breach of contract (Count Two), breach of the implied covenant of good faith and fair dealing (Counts Three and Four), interference with prospective economic advantage (Count Five), and tortious interference with contractual relations (Counts Six and Seven).
Now pending before the court is the defendants' Motion for Summary Judgment on *125 Counts One and Three. For the reasons stated below, this motion [doc. # 21] is GRANTED. Forbes is directed to file an amended complaint within thirty (30) days of this ruling, which shall include only Counts Two, Four, Five, Six and Seven.
STANDARD
A motion for summary judgment may not be granted unless the court determines that there is no genuine issue of material fact to be tried and that the moving party is entitled to judgment as a matter of law. See Rule 56(c), Fed.R.Civ.P.; Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). The substantive law governing the case identifies those facts that are material on a motion for summary judgment. See Anderson, 477 U.S. at 248, 106 S.Ct. at 2510. A court must grant summary judgment "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 any material fact ...." Rule 56(c); see Miner v. Glens Falls, 999 F.2d 655, 661 (2d Cir.1993) (citation omitted). A dispute regarding a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Aldrich v. Randolph Cent. Sch. Dist., 963 F.2d 520, 523 (2d Cir.) (internal quotation marks and citation omitted), cert. denied, 506 U.S. 965, 113 S. Ct. 440, 121 L. Ed. 2d 359 (1992). The burden of showing that no genuine dispute about an issue of material fact exists rests on the party seeking summary judgment. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S. Ct. 1598, 1608, 26 L. Ed. 2d 142 (1970).
After discovery, if the party against whom summary judgment is sought "has failed to make a sufficient showing on an essential element of [its] case with respect to which [it] has the burden of proof," then summary judgment is appropriate. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2552-53, 91 L. Ed. 2d 265 (1986). In assessing the record to determine whether a genuine dispute as to a material fact exists, the court is required to resolve all ambiguities and draw all inferences in favor of the party against whom summary judgment is sought. See Anderson, 477 U.S. at 255, 106 S.Ct. at 2513-14. Thus, "[o]nly when reasonable minds could not differ as to the import of the evidence is summary judgment proper." Bryant v. Maffucci, 923 F.2d 979, 982 (2d Cir.) (citation omitted), cert. denied, 502 U.S. 849, 112 S. Ct. 152, 116 L. Ed. 2d 117 (1991).
FACTS
Forbes was, at all times during his relationship with JMPC, an individual resident of Texas, doing business as "Surgical Specialist," with his principal place of business in Houston, Texas. (See Defs.' Stat. Mat. Facts About Which There is no Genuine Issue [hereinafter "Defs.' Stat."] ¶ 1.) Until JMPC merged with J & J in 1995, it was a Delaware corporation, authorized to do business in Connecticut, with its principal place of business in Stamford, Connecticut. (See id. ¶ 2.)
Prior to its merger with J & J, JMPC sold human joint replacement devices to hospitals and surgeons. (See Aff. C. Anthony Whittingham [hereinafter "Whittingham Aff."] ¶ 5.) Its principal product was a total-hip prothesis, for use in partial or total hip joint replacement surgery. (Id.) JMPC marketed its products through a network of independent distributors who were assigned a territory and compensated on a commission basis. (See id. ¶ 6.) These distributors did not purchase JMPC products for resale. (See id. ¶ 7.) Rather, they maintained an inventory of JMPC products on a consignment basis. (Id.) When a distributor sold a product, JMPC would bill the customer based on paperwork submitted by the distributor and then pay the distributor a commission. (Id.)
In November 1987, Forbes began selling JMPC's prosthetic hip and knee implants to hospitals and surgeons for use in knee and hip replacement surgery. (See Aff. Larry D. Forbes [hereinafter "Forbes Aff."] ¶ 2.) These products were particularly well-suited for "revision surgery," in which the product is used to replace a previously inserted implant that has worn out over time. (Id.) JMPC initially assigned Forbes to the San Antonio, Texas area, but by 1995, his territory included southeast Texas and southwest Louisiana. (See Whittingham Aff. ¶ 8.) Every year, Forbes received new quotas for his *126 territory and signed a new distributor agreement. (See id. ¶ 9.)
According to the 1995 agreement, which Forbes signed on February 9, 1995, JMPC had the right to terminate its relationship with Forbes at any time. It stated:
The Distributor Agreement is for an indefinite term, is at the will of each of the parties to it, and JMPC has the right to recall all consigned inventory and terminate the Distributor Agreement at any time.
(First Am. Compl. Ex. 1, at 1.) The agreement further provided that, if JMPC merged with another company, it would allow distributors in good standing to continue selling under the current agreement for a specified number of months, depending on how long the distributor had been employed by JMPC. (See id. at 47.) The agreement specified that any disputes arising under it would be governed by the law of the State of Connecticut. (See id. at 1 (stating that "by entering into the Distributor Agreement the [d]istributor stipulates to jurisdiction of the courts in the State of Connecticut over any dispute between JMPC and the [d]istributor.").)
On April 26, 1995, JMPC notified Forbes that it had agreed to merge with J & J and that, "unless notified otherwise, ... all ... present agreements will remain in effect." (First Am. Compl. Ex. B.) Then, by letter dated July 28, 1995, JMPC terminated Forbes's distributor agreement and offered him an additional six months to continue selling its products (i.e. until January 26, 1996). (See id. Ex. C.) On September 18, 1995, Forbes commenced this law suit.
DISCUSSION
In Count One, Forbes alleges that JMPC terminated his alleged franchise agreement without good cause, in violation of Conn. Gen.Stat. § 42-133e. (See First Am. Compl. Count One.) In Count Three, he alleges that this termination of the agreement breached the implied covenant of good faith and fair dealing.
The defendants claim that summary judgment should enter as to Counts One and Three because, while Connecticut law governs this dispute, the Connecticut Franchise Act ("the Act") is not applicable to individuals such as Forbes who do not maintain a place of business in Connecticut. The court agrees.
The Act prohibits franchisors from, inter alia, canceling or failing to renew a franchise agreement without good cause. See Conn. Gen.Stat. § 42-133f(a). However, the Act only applies to a franchise agreement, "the performance of which contemplates or requires the franchisee to establish or maintain a place of business in this state." Conn. Gen.Stat. Ann. § 42-133h (West 1992).
Forbes argues that the provision in the Distributor Agreement which states that Connecticut law shall apply to any disputes arising from the agreement affords him the protections of the Act. He claims that the parties included a clause stating that Connecticut law applied to potential future disputes because they specifically contemplated that the Act would apply to their franchise agreement. However, without deciding whether Forbes was actually a "franchisee" as defined by the Act, a fair reading of both the Act itself and the case law interpreting it lead the court to conclude that only franchisees who have established or maintained a place of business in Connecticut are covered by the Act.
Forbes did not maintain a place of business in Connecticut. Under the parties' agreement, JMPC assigned him a territory in Texas. Thus, the performance of his agreement with JMPC did not "contemplate[] or require[] the franchisee to establish or maintain a place of business in [Connecticut]." Conn. Gen.Stat. Ann. § 42-133h (West 1992). The provision of the agreement which states that Connecticut law applies to future disputes merely governs which state's laws applies to such disputes, not whether the jurisdictional prerequisites of a specific statute have been satisfied. A plain reading of the Act reveals that it does not protect Forbes because his agreement with JMPC did not contemplate or require that he maintain a business in Connecticut.
Furthermore, "it is doubtful that the Connecticut franchise law applies extraterritorially." H.J., Inc. v. ITT Corp., 867 F.2d 1531, *127 1546 (8th Cir.1989) (citing Carlos v. Philips Bus. Sys., Inc., 556 F. Supp. 769, 777 (E.D.N.Y.1983) (holding the Act does not have extraterritorial effect)). The court can find no authority supporting the proposition that the Act was intended to protect franchisees outside of Connecticut. Id. Rather, the Act only applies to Connecticut franchisees who present evidence that they contemplated establishing or maintaining a place of business in Connecticut. See Auto Parks, Inc. v. Stanley Works, Civ. A. No. 89-0183, 1990 WL 107587, at *7 (E.D.Pa. July 27, 1990). Without such evidence, the Act is inapplicable. Id. Here, the evidence shows, and the parties do not dispute, that Forbes maintained his business and conducted his marketing activity in Texas. Cf. Chem-Tek, Inc. v. General Motors Corp., 816 F. Supp. 123 (D.Conn.1993) (holding that the Act was applicable to an alleged franchisee who maintained its place of business in Connecticut, regardless of where the franchisee focussed its marketing activity). Thus, Forbes is not covered by the Act, and summary judgment must enter as to Count One.
As to Count Three, Forbes argues that "[b]ecause a franchise relationship existed between Forbes and JMPC, JMPC's termination of Forbes in violation of the Franchise Act was also a violation of the covenant of good faith and fair dealing." (Pl.'s Opp. Defs.' Mot. Summ. J. at 23.) He claims that the provisions in the distributor agreement which state that the agreement is terminable, at the will of the parties, or if JMPC merges with another company, do not trump the provisions of the Act which state that a franchise agreement may not be terminated without good cause. (See id. at 24.) However, because the court has held that Forbes is not protected by the provisions of the Act, this count must also fail. In addition, there is nothing in the record to contradict the specific provisions of the distributor agreement which allow JMPC to terminate Forbes if it merges with another company. Accordingly, summary judgment must also enter as to Count Three.
CONCLUSION
For the foregoing reasons, the defendants' Motion for Summary Judgment [doc. # 21] is GRANTED. Forbes is directed to file an amended complaint within thirty (30) days of this ruling which shall include only Counts Two, Four, Five, Six and Seven. | 01-03-2023 | 10-30-2013 |
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