url stringlengths 55 59 | text stringlengths 0 818k | downloaded_timestamp stringclasses 1 value | created_timestamp stringlengths 10 10 |
|---|---|---|---|
https://www.courtlistener.com/api/rest/v3/opinions/1588536/ | 944 So.2d 864 (2006)
STATE of Louisiana
v.
Mack Henry JOHNSON, Jr.
No. 2006-937.
Court of Appeal of Louisiana, Third Circuit.
December 6, 2006.
*865 Annette Roach, Louisiana Appellate Project, Lake Charles, LA, for Defendant/Appellant, Mack Henry Johnson, Jr.
Don M. BurkettDistrict Attorney, ADA Clifford R. Strider, III, Many, LA, for Plaintiff/Appellee, State of Louisiana.
Court composed of SYLVIA R. COOKS, MARC T. AMY, and JAMES T. GENOVESE, Judges.
GENOVESE, Judge.
Defendant, Mack Henry Johnson, Jr., was charged by bill of information with one count of simple escape, a violation of La.R.S. 14:110. Trial by jury commenced on January 30, 2006. On the same day, a jury found Defendant guilty as charged. On February 2, 2006, the State filed a multiple offender bill against Defendant. On April 27, 2006, Defendant was adjudicated a third-time felony offender and sentenced to five years at hard labor, to be served consecutively to any other sentence Defendant was currently serving. A motion to reconsider the sentence was filed on May 4, 2006, which was subsequently denied on May 15, 2006 without written reasons.
Defendant is now before this court on appeal. He assigns four errors: 1) the trial court allowed Defendant to proceed to trial without counsel, despite the fact that counsel was appointed and the record does not reflect that counsel withdrew from the case; 2) the trial court failed to inquire as to whether Defendant knowingly and intelligently waived his right to counsel; 3) Defendant was denied his right to counsel when defense counsel, who had been appointed after trial, asserted that he was unprepared to proceed, but the trial court proceeded with the habitual offender hearing regardless; and 4) the trial court erred when it used two felony convictions which arose out of the same occurrence, and pled on the same date, as two separate predicates for the purpose of the habitual offender adjudication, or in the alternative, defense counsel "rendered ineffective assistance and Mack Henry Johnson, Jr. was prejudiced by counsel's actions (or inactions) when he was adjudicated a third felony offender."
For the following reasons, we find merit in Defendant's first two assignment of errors. Accordingly, we reverse Defendant's conviction for simple escape; we reverse Defendant's habitual offender adjudication; we vacate Defendant's sentence; and we remand for further proceedings consistent herewith.
FACTS:
On or about April 21, 2005, Defendant was picked up for a parole violation and taken to the Sabine Parish Detention Center for processing. While waiting to be booked, Defendant, without permission, walked out of the detention center and fled.
*866 ASSIGNMENTS OF ERROR NUMBER 1 AND 2:
We will address assignments of error number one and two together because the facts and issue of the first assignment are pertinent to the issue of the second assignment. The questions presented by these two assignments of error are whether Defendant was effectively denied the right to counsel and, under the circumstances, whether he knowingly and intelligently waived his right to counsel.
An accused whose offense subjects him to the possibility of imprisonment is guaranteed the right to counsel. U.S. Const. Amend. VI; La. Const. art. I, § 13. State v. Hayes, 95-1170 (La.App. 3 Cir. 3/6/96), 670 So.2d 683. Further, in State v. Whatley, 03-655, pp. 22-23 (La.App. 3 Cir. 11/5/03), 858 So.2d 751, 765-66, this court cited Hayes as follows:
Before a defendant may waive his right to counsel, the trial court must determine whether the defendant's waiver of counsel is intelligently and voluntarily made, and whether his assertion of his right to represent himself is clear and unequivocal. State v. Hegwood, 345 So.2d 1179 (La.1977). The determination of whether there has been an intelligent waiver of the right to counsel depends upon the facts and circumstances surrounding the case, including the background, experience, and conduct of the accused. State v. Harper, 381 So.2d 468 (La.1980). Although a defendant should be made aware of the dangers and disadvantages of self-representation, there is no particular formula which must be followed by the trial court in determining whether a defendant has validly waived his right to counsel. State v. Carpenter, 390 So.2d 1296 (La. 1980). However, the record must establish that the accused knew what he was doing and that his choice was made "with eyes open." Id. at 1298, citing Faretta v. California, 422 U.S. 806, 95 S.Ct. 2525, 45 L.Ed.2d 562 (1975).
The Third Circuit Court of Appeal has repeatedly required the trial court meet the following requirements in determining whether a defendant has validly waived his right to counsel: first, determine a defendant's literacy, competency, understanding and volition, i.e. was defendant's waiver of counsel made voluntarily and intelligently; and second, warn the defendant of the dangers and disadvantages of self-representation, so that the record establishes that the defendant knew what he was doing. [State v.] Mitchell, 580 So.2d 1006 [(La.App. 3 Cir.1991) writ denied, 613 So.2d 969 (La.1993)]; [State v.] Smith, 479 So.2d 1062 [La.App. 3 Cir.1985)]; State v. Adams, 526 So.2d 867 (La.App. 3 Cir.1988); State v. Sepulvado, 549 So.2d 928 (La.App. 3 Cir.1989); and State v. Bourgeois, 541 So.2d 926 (La.App. 3 Cir.1989), writ denied, 572 So.2d 85 (La.1991).
In the current case, Defendant was initially assigned counsel. According to the minute entry dated April 26, 2005, he was brought before the court on a "72 hour" hearing where he was advised of the charge against him and of his right to counsel. At this time, Defendant requested the appointment of counsel. The trial court appointed Attorney Joseph D. Toups to represent him. There was no transcript available of this hearing. The order for indigent representation was signed and filed into the record on April 26, 2005.
According to the minutes, Defendant was scheduled to be arraigned on July 28, 2005; however, neither he nor counsel were present, and the matter was refixed for September 29, 2005. On September 29, 2005, Defendant was present, but without counsel. The Court advised him of the *867 charge against him, his right to counsel, and his right to formal arraignment. Defendant advised the trial court that he could afford counsel and wished to have counsel present for arraignment. The matter was refixed for October 27, 2005. There is no transcription of the September 29th hearing.
Defendant was arraigned on the charge of simple escape on October 27, 2005. At arraignment, the trial court asked Defendant if he was represented by counsel. The following conversation took place.
THE DEFENDANT-JOHNSON: No sir, but I just got a job like about this last week right here. I'm trying to save my money and get one.
THE COURT: How much do you earn at your job?
THE DEFENDANT-JOHNSON: Uh like $5.75 an hour.
THE COURT: Okay. Mr. Johnson, you would qualify for a court-appointed attorney but you also have the opportunity to hire the attorney of your choice at any time during the proceedings up until it gets too late. Do you wish to have a court-appointed attorney at this time or not?
THE DEFENDANT-JOHNSON: No, sir.
THE COURT: You don't wish to have a court appointed attorney?
THE DEFENDANT-JOHNSON: No, sir.
THE COURT: Okay. Any pending cases on Mr. Mack Henry Johnson not tried?
MR. BRANDON: (No response)
COURT: Simple is with or without, do y'all know?
MR. TOUPS: Yes sir.
THE COURT: It is. Category four allotment.
DEPUTY CLERK: Division B.
THE COURT: Division B. Your pre-trial date is January 9th and your trial date is January 30th.
THE DEFENDANT-JOHNSON: Can you tell me the penalties on that?
. . . .
THE COURT: All right, thank you. Hold on, that was A-2. That was work release. I told you wrong. A-3A-1, shall be imprisoned with or without hard labor for not less than two years nor more than five years. And it is a consecutive sentence. So it's at least two years and no more than five years.
THE DEFENDANT-JOHNSON: All right. There ain't no fine on that huh?
THE COURT: Nope.
Nothing further occurred in the record until the January 9, 2006 pre-trial hearing. At that time, the State noted there still was not an enrollment of counsel for Defendant. Defendant explained that he had been incarcerated in November and in a rehabilitation facility in October. He stated he wanted to represent himself.
THE COURT: It's a bad idea.
THE DEFENDANT-JOHNSON: Naw.
THE COURT: Do you understand what the charge of simple escape is?
THE DEFENDANT-JOHNSON: Yes, sir.
THE COURT: Do you understand what the penalty provisions for it are?
THE DEFENDANT-JOHNSON: Yes, sir.
THE COURT: What are they?
THE DEFENDANT-JOHNSON: Uh start off at two years.
THE COURT: And do you understand that it runs any sentence on an escape charge run, by law, consecutively with anything else you're serving?
*868 THE DEFENDANT-JOHNSON: Yes, sir.
THE COURT: Okay. You're not obviously you're here and you're not asking for a court-appointed attorney, is that correct?
THE DEFENDANT-JOHNSON: No, sir.
THE COURT: Mr. Strider, anything you want me to add to that?
MR. STRIDER: What is his education level?
THE COURT: Mr. Johnson, what kind of education have you received?
THE DEFENDANT-JOHNSON: High school diploma.
THE COURT: You graduated?
THE DEFENDANT-JOHNSON: Uh yes, sir.
THE COURT: What year did you graduate in?
THE DEFENDANT-JOHNSON: Uh 2002, yeah, it was 2002.
THE COURT: Okay. What kind of work have you done?
THE DEFENDANT-JOHNSON: Uh nothing really. Just here and there odd and end jobs. I used to work at Burger King but I got a probation violation and got fired.
THE COURT: All right. You're ready for trial January 30th? That's your trial date.
. . . .
MR. STRIDER: Your Honor, just for the record, the Defendant has two prior convictions. To test the Court's knowledge of whether he is capable of representing himself, perhaps you could inquire if he knows what that means and the possible results of being convicted.
THE DEFENDANT-JOHNSON: Yelp [sic], that means that if I do get convicted they probably gonna violate my probation which I have to back up my probation and that's gonna run wild with the time on my escape what they gonna be wild, so I'll do one and then the other after that.
THE COURT: How about an habitual offender bill?
THE DEFENDANT-JOHNSON: I done been convicted on one. They ran both of them on the same docket. I got one year on both of them at the same time.
THE COURT: It's still possible to be a second felony offender.
THE DEFENDANT-JOHNSON: I'm ready to deal with that then.
THE COURT: You've heard the saying of a man who represents himself as an attorney has a fool for a client, you've heard that?
THE DEFENDANT-JOHNSON: Yeah, I've heard that before.
THE COURT: Okay.
Defendant then proceeded to trial on January 30, 2006. There was no further discussion at trial regarding Defendant's literacy, competency, understanding and volition. Defendant argues that the trial court's brief interview with him "falls short of the requirements necessary to determine whether he validly waived his right to counsel."
Initially, at the "72 hour" hearing, Defendant requested and was assigned indigent defense counsel. As noted above, while there is apparently no transcript of the hearing, the written appointment was filed into the record. On the first arraignment date, Defendant informed the trial court he had not been able to obtain counsel, and the matter was reset at his request. However, on October 27, 2005, at the time scheduled for arraignment, Defendant stated that he had not been able to retain counsel because he had been in rehabilitation *869 and incarcerated. During the hearing, the trial court informed Defendant that he would qualify for a court-appointed attorney. However, there was no indication in the record that Defendant was even aware that he had been appointed counsel, or if there were reasons he chose not to utilize appointed counsel's services. Without further ado, the trial court set pre-trial and trial dates, without even taking Defendant's guilty plea. Notably, during the hearing, prior court-appointed counsel, Joseph D. Toups, even answered one of the trial court's questions regarding the offense.
Whether or not Defendant was represented by counsel at arraignment is potentially problematic; however, a trial court may take an accused's guilty plea without counsel. La.Code Crim.P. art. 516. According to Louisiana jurisprudence, an arraignment is not necessarily a critical stage of the criminal process, and available defenses are not lost if not pled at arraignment. Article 516 permits a subsequently appointed or procured counsel to withdraw any motion, plea, or waiver made by the accused for a reasonable time before trial. See State v. Tarver, 02-973 (La.App. 3 Cir. 3/12/03), 846 So.2d 851, writ denied, 03-1157 (La.11/14/03), 858 So.2d 416. Therefore, at this point, there was no error with the trial court assuming Defendant's guilty plea and setting the case for trial without defense counsel being present right at the time.
Defendant argues, however, that the "record of this case does not show that Mr. Toups appeared on the record in a representative capacity for Mack Henry Johnson, Jr., at any stage of these proceedings." Defendant further argues:
In the instant case, trial counsel's total failure to meet with or otherwise make any contact with Mack Henry Johnson, Jr. at any moment in the pendency of these proceedings constitutes a denial of counsel during the pre-trial phase of these criminal proceedings. Because the right to counsel "includes the concomitant right to communicate with counsel at every critical stage of the proceedings," the total failure to meet or represent Mack Henry Johnson, Jr. in anyway constitutes a denial of counsel. Perry v. Leeke, 488 U.S. 272, 298, 109 S.Ct. 594, 609, 102 L.Ed.2d 624 (1989)(Marshall, J., dissenting)(citing Powell, 287 U.S. at 68-69, 53 S.Ct. at 64).
Regardless of whether Defendant was or was not represented at this point, when Defendant informed the trial court at the pre-trial hearing he could not afford to retain counsel and would represent himself, the trial court should have obtained an adequate waiver of the right to counsel, which it failed to do.
In Whatley, 858 So.2d 751, this court found that there was insufficient inquiry into the accused's competency to represent himself. The accused was not represented by counsel at the arraignment or at trial. He had indicated to the trial court that he desired to retain counsel; however, at the time of trial, he indicated he would defend himself because he could not afford to retain counsel. The trial court then inquired into the accused's literacy by having him read a page of jury instructions in court. There was no further inquiry into his background or the complexity of the case. The trial court then went on to discuss whether the accused could afford to hire counsel and advised him he could have counsel appointed to represent him. The trial court discussed some trial procedure with the accused and advised him that he had not been trained in the law, and that the prosecutor was an experienced attorney. After noting that throughout the colloquy, the accused said *870 several times that he would like to have counsel, but could not afford one, this court stated:
Simply put, the overall colloquy suggests Defendant did not understand his rights. Further, although the court conducted a clear and practical inquiry into Defendant's literacy by having him read in open court, there was no further inquiry into his education or background, or the relative complexity of the case. As shown by the Jackson review in the previously-discussed assignments, the issue of co-ownership gave this case nuances that Defendant, a layman, may not have appreciated. As the lower court did not inquire into these factors or similar issues, it is clear the trial court did not make a sufficient inquiry into whether Defendant knowingly and intelligently waived his right to obtain trial counsel.
Id. at 767.
An example of an adequate inquiry into whether the accused intelligently and knowingly waived his right to counsel can be found in State v. Bruce, 03-918, pp. 5-6 (La.App. 5 Cir. 12/30/03), 864 So.2d 854, 858, as follows:
[T]he record in the present case shows a detailed inquiry into the understanding of defendant in waiving his right to counsel. On June 17, 2002, defendant appeared in open court and unequivocally stated his desire to represent himself. Prior to reviewing the waiver of right to an attorney form, the trial court cautioned defendant against self-representation by explaining several times that defendant was facing a life sentence as a multiple offender if convicted on the underlying charge. The trial court also reviewed the current plea offer by the State which was five years as a multiple offender. The trial court expressed its opinion that self-representation places defendant at a tremendous disadvantage because the State will use an experienced prosecutor to attempt to convict defendant. While acknowledging defendant's right to self-representation, the trial court stringently discouraged it.
The trial court further advised defendant that it could give only limited help in making sure defendant took advantage of the procedural laws available to him and even discussed defendant's option under North Carolina v. Alford, 400 U.S. 25, 91 S.Ct. 160, 27 L.Ed.2d 162 (1970). The trial court reminded defendant that appointed counsel could remain on the case as an adviser to help defendant with procedural matters. The trial court expressed concern that defendant was making a decision out of anger or frustration and took a break in the proceedings to allow defendant an opportunity to think about his decision. Defendant assured the trial court he was not choosing self-representation out of anger or frustration.
After the break, defendant again stated he wanted to defend himself. The trial court then reviewed with the defendant in open court the waiver of right to an attorney form which defendant had executed. The form indicated defendant could read and write. It advised defendant that an attorney is experienced and may know of certain defenses available or procedures which may result in defendant's case being dismissed or the charges being reduced that may not be known to defendant. Defendant was further advised that he would have to file his own motions, make his own objections, cross-examine witnesses at trial and prepare his own defense.
Defendant was also told of his right to have an attorney appointed to assist him.
*871 In Bruce, 864 So.2d 854, the fifth circuit found that the trial court adequately complied with the requirements for ascertaining that the accused knowingly and intelligently waived his right to counsel. The fifth circuit also stated:
In accepting a waiver of counsel, the trial court should advise the defendant of the nature of the charges, the penalty range for the charges and of the dangers and disadvantages of self-representation such as the failure to recognize objections to inadmissible evidence and the inability to adhere to technical rules governing trials. State v. Strain, 585 So.2d 540, 542-543 (La.1991). Additionally, the trial court should inquire into the defendant's age, education and mental condition and should determine according to the totality of circumstances whether the accused understands the significance of the waiver. [Id.] In order to sufficiently establish on the record that defendant is making an intelligent and knowing waiver, the inquiry should involve more than an interchange of "yes" or "no" responses from the defendant. Id.
There is no inflexible criteria or magic word formula for determining the validity of a defendant's waiver of the right counsel. Rather, the validity of the waiver must take into account the totality of the circumstances in each case. State v. Stevison, 97-3122 (La.10/30/98), 721 So.2d 843, 845.
Id. at 857.
In a recently decided case, State v. Poche, 05-1042 (La.App. 3 Cir. 3/1/06), 924 So.2d 1225, this court analyzed the trial court's inquiry of the accused to determine if he waived his right to counsel. Poche, while assisted by counsel, took over his defense at the close of the State's case. The transcript of the dialogue between the trial court and Poche indicated that the trial court perfunctorily asked him if he understood what was going on, to which the accused answered in the affirmative. The trial court told Poche that he must follow the rules of criminal procedure and evidence, and that if he was incapable of doing so, his counsel would take over the questioning of the witnesses. Based on the trial transcript alone, this court stated:
The trial court's interview with Defendant did not comply with the requirements necessary to determine whether Defendant validly waived his right to counsel. The trial court did not make an express determination regarding Defendant's literacy, competency, or understanding. Although the trial court asked Defendant if he wished to act as his own counsel, it failed to determine whether his waiver was intelligently made. Also, the trial court failed to adequately warn Defendant of the dangers and disadvantages of self-representation: it did not inform him that self-representation might have an adverse effect on the outcome of the case, tell him the elements of the offenses, or explain the maximum penalties that he would fact if convicted.
Id. at 1233.
In the case sub judice, the trial court asked Defendant if he understood the charge, to which Defendant answered, "Yes." The trial court asked if he knew the penalty for the offense and Defendant answered, "start off at two years." The trial court then explained that any sentence imposed would run consecutively. Defendant responded, "Yes." The State then asked the only question concerning Defendant's literacy, which was whether Defendant had graduated from high school. Defendant said he did. When asked what employment he had since high school, Defendant answered, "Uh nothing really." He stated that he had worked at Burger *872 King briefly until he was fired because of a probation violation. The State then insisted that the trial court question Defendant regarding the consequences of being convicted as charged and the court mentioned a habitual offender bill. While Defendant had really been told that if he was convicted he would be required to serve the sentence consecutively to the sentence imposed on his prior convictions, his answer to whether he understood a habitual offender charge was not necessarily responsive, and indicated that he only understood that he had prior convictions.
During the dialogue at the pre-trial hearing, the trial court did not reiterate that Defendant had the right to counsel, nor did the trial court advise Defendant he could be assisted by counsel. At no time, in the record, did the trial court discuss the elements of the offense. Other than telling Defendant it was a bad idea and that an attorney who represented himself had a fool for a client, the trial court did not advise him of the dangerousness and disadvantages of self-representation. The trial court did not warn him about the experience of the State's prosecutor in prosecuting cases, or discuss filing motions such as discovery motions or motions to suppress, trial procedures, objections, or the consequence of putting himself on the stand to testify.[1]
Accordingly, based on the transcript of the pre-trial hearing, we find that the trial court did not adequately ascertain whether Defendant knowingly and intelligently waived his right to counsel.
However, this court in Poche, 924 So.2d 1225, held that the entire "record should be examined for indications that a defendant was aware of the dangers and disadvantages of self-representation." Id. at 1233 (citing State v. Norman, 99-600 (La. App. 5 Cir. 2/16/00), 756 So.2d 525, writ denied, 00-971 (La.3/23/01), 787 So.2d 1007). In Poche, the accused had filed several pre-trial pro se briefs, and on several occasions the trial court allowed him to argue the motions. Therefore, by the time of trial, this court found that "the trial court was well aware that he was literate, competent, and understood the charges against him." Id. This court stated, "we find that, at the time of the waiver, the trial court only needed to ascertain Defendant's volition, which it did, to satisfy the first step of the Hayes test." Id.
Moreover, as in Bruce, 864 So.2d 854, the trial court knew that Poche had prior convictions. This court noted that at sentencing the trial court discussed Poche's extensive criminal record. He was a five-time felony offender and had several misdemeanor convictions; thus, he had knowledge of the judicial process through his past experiences.
In the case sub judice, there were no motions filed prior to the pre-trial hearing, and nothing filed prior to trial. Moreover, the record shows that Defendant's two prior convictions were a possession of marijuana with intent to distribute and a simple kidnapping, both of which occurred on the same day and pled to on the same day. It is not clear from the record whether these offenses were pled before this judge.
Under the facts and circumstances of this case, the trial court failed to adequately *873 ascertain whether Defendant knowingly and intelligently waived his right to counsel. The trial court's dialogue with Defendant did not sufficiently address his literacy, competency, understanding, or volition; nor did the trial court adequately advise Defendant of the dangers and disadvantages of self-representation. We find that Defendant's right to counsel was violated when the trial court permitted him to represent himself without adequate warning, particularly since Defendant had originally asked for counsel, had been appointed counsel, and on two occasions had advised the trial court he desired counsel, then finally admitted to the trial court he could not afford counsel.
CONCLUSION
For these reasons, we reverse Defendant's conviction of simple escape. As a consequence thereby, Defendant's habitual offender conviction as a second-time felony offender is reversed, his sentence is vacated, and the matter is remanded to the trial court for further proceedings.
Because we reverse Defendant's conviction of simple escape, thereby reversing the habitual offender adjudication, the remaining two assignments of error are moot.
REVERSED AND REMANDED.
NOTES
[1] In the presentation of his case, Defendant put a woman on the stand who testified that the police officers came to her house to locate Defendant after he fled the detention center. According to her testimony, Defendant had hid in her house. She testified that she told the officers where to find him. Defendant also took the stand on his own behalf. During cross examination, the State asked him about any prior convictions. When he objected, the trial court told him he had to answer the question because he was under cross-examination. Defendant then admitted to having two prior felonies. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2695728/ | [Cite as McMaken v. Wright State Univ., 2010-Ohio-3480.]
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
JAMES C. MCMAKEN, et al.
Plaintiffs
v.
WRIGHT STATE UNIVERSITY
Defendant
Case No. 2009-03801
Judge Alan C. Travis
DECISION
{¶ 1} On June 23, 2010, the parties filed a joint stipulation of facts regarding the
civil immunity of Jonathan Saxe, M.D. and Kathryn Tchorz, M.D. pursuant to R.C.
2743.02(F) and 9.86. On June 24, 2010, defendant filed a supplement to Exhibit B of
the stipulation.1 The parties stipulated to the following facts:
{¶ 2} “1. At times relevant herein, following his injuries suffered in a horse
riding accident on April 2, 2008, plaintiff Craig McMaken was a patient of Miami Valley
Hospital in Dayton, Ohio. (Excerpts of medical records attached as exhibits to
depositions of Drs. Saxe and Tchorz)
{¶ 3} “2. In April, 2008, Dr. Jonathan Saxe and Dr. Kathryn Tchorz were
trauma surgeons on faculty staff of Wright State University Boonshoft School of
Medicine working out of Miami Valley Hospital and were employed by both the [s]tate of
1
On June 28, 2010, plaintiffs dismissed Mary McCarthy, M.D., from the connected action in the
Montgomery County Court of Common Pleas by filing a notice of voluntary dismissal. Therefore, her
immunity is no longer at issue in this case.
Ohio through Wright State University and Boonshoft School of Medicine by Wright State
Physicians, a private practice group connected with the University.
{¶ 4} “3. Their duties as professors of medicine included teaching, research,
and patient care. (Employment contracts attached as Exhibits A and B) Their duties in
their private practice group included patient care.
{¶ 5} “4. The allegations of negligence in this action center around the care
and treatment Mr. McMaken received from April 9, 2008, after an epidural catheter was
removed from his thoracic spine, through April 12, 2008, when an MRI of the thoracic
spine was performed and revealed an epidural abscess at that site.
{¶ 6} “5. It is alleged that Drs. Saxe and Tchorz, as well as various other
physicians and health care providers who do not claim to have been acting as state
employees, were negligent including but not limited to in delaying the MRI and thus the
diagnosis of the abscess, and that earlier diagnosis and treatment would have
prevented Mr. McMaken’s paralysis.
{¶ 7} “6. On April 9-11, 2008, Dr. Tchorz was the attending trauma physician
for Mr. McMaken and she [saw him during rounds on those] mornings. She testified that
her practice is to round with her residents. It is alleged that there was evidence of an
infection as early as April 9 and that an MRI should have been ordered and completed
on April 10.
{¶ 8} “7. On the morning of April 11, 2008, a thoracic MRI was ordered by pain
management ‘now’ or ‘stat’ to rule out a MRSA infection in the epidural space and
approved by infectious disease. Also on that morning, Dr. Tchorz made the
determination to take Mr. McMaken for an exploratory laparotomy instead of, or at least
before, performing the MRI. In the ensuing 35 hours, the MRI was not performed, and it
is alleged that the failure to obtain that MRI promptly was a deviation from the standard
of care.
{¶ 9} “8. Dr. Tchorz and the residents all testified that the decision to perform
the laparotomy was discussed between Dr. Tchorz and the residents. Plaintiffs allege
that the failure to promptly perform the MRI either before or very soon after the
laparotomy was negligent, regardless of whether he had the laparotomy.
{¶ 10} “9. The medical record and the testimony of all persons involve[d]
confirm that residents performed the laparotomy under Dr. Tchorz’ supervision. The
technical performance of the surgery is not at issue in this case.
{¶ 11} “10. Dr. Tchorz testified that she discussed the MRI with a resident or
residents and that she very specifically instructed them to be sure that the MRI was
performed ‘that night,’ as soon after the surgery as possible. None of the residents
deposed have any recollection of that instruction.
{¶ 12} “11. The post operative orders, which were completed by residents, do
not contain an order for the MRI.
{¶ 13} “12. On April 12, 2008, Dr. Saxe was the trauma attending for Mr.
McMaken in ICU.
It is alleged that the ongoing failure on April 12 to obtain the MRI ordered on the
morning of * * * April 11 was a continuing deviation from the standard of care. The
trauma progress note on the morning of April 12 does not mention an order for the MRI,
but Dr. Saxe testified that on April 12 he discussed with a resident getting an MRI when
Mr. McMaken was stabilized.
{¶ 14} “13. Dr. Saxe rounded with a resident * * * in the morning and testified
that he saw the patient with a resident several other times that day, although he did not
make any additional notes in the chart. He further testified that he always does his
rounding with a resident or residents, and that he discussed Mr. McMaken’s care with
the ICU resident on April 12. There is no evidence to dispute this testimony.
{¶ 15} “14. Late in the afternoon on April 12, the thoracic MRI was reordered
‘stat’ by a trauma resident when an ICU nurse reported that Mr. McMaken had stopped
moving his legs. Dr. Saxe testified that he was instrumental in obtaining this order, but
his involvement is not reflected in the medical record.”
{¶ 16} R.C. 2743.02(F) states, in part:
{¶ 17} “A civil action against an officer or employee, as defined in section 109.36
of the Revised Code, that alleges that the officer’s or employee’s conduct was
manifestly outside the scope of the officer’s or employee’s employment or official
responsibilities, or that the officer or employee acted with malicious purpose, in bad
faith, or in a wanton or reckless manner shall first be filed against the state in the court
of claims, which has exclusive, original jurisdiction to determine, initially, whether the
officer or employee is entitled to personal immunity under section 9.86 of the Revised
Code and whether the courts of common pleas have jurisdiction over the civil action.”
{¶ 18} R.C. 9.86 states, in part:
{¶ 19} “[No officer or employee [of the state] shall be liable in any civil action that
arises under the law of this state for damage or injury caused in the performance of his
duties, unless the officer’s or employee’s actions were manifestly outside the scope of
his employment or official responsibilities or unless the officer or employee acted with
malicious purpose, in bad faith, or in a wanton or reckless manner.”
{¶ 20} The Supreme Court of Ohio has held that “in an action to determine
whether a physician or other health-care practitioner is entitled to personal immunity
from liability pursuant to R.C. 9.86 and 2743.02[F], the Court of Claims must initially
determine whether the practitioner is a state employee. * * *
{¶ 21} “If the court determines that the practitioner is a state employee, the court
must next determine whether the practitioner was acting on behalf of the state when the
patient was alleged to have been injured. If not, then the practitioner was acting
‘manifestly outside the scope of employment’ for purposes of R.C. 9.86. If there is
evidence that the practitioner’s duties include the education of students and residents,
the court must determine whether the practitioner was in fact educating a student or
resident when the alleged negligence occurred.” Theobald v. University of Cincinnati,
111 Ohio St.3d 541, 2006-Ohio-6208, ¶30-31. (Emphasis added.)
{¶ 22} The parties in this case have stipulated that, in addition to their private
practice positions, Drs. Saxe and Tchorz were faculty physicians employed by the state
at defendant university’s college of medicine. Thus, the issue before the court is
whether Drs. Saxe and Tchorz were acting on behalf of the state at the time when the
alleged negligence occurred and, because it has been stipulated that their duties
included the education of residents, whether they were, in fact, educating residents at
the time of the alleged negligence.
{¶ 23} Upon review of the stipulated facts, it is apparent that Drs. Saxe and
Tchorz were acting on behalf of the state and educating a resident, or residents, at all
times pertinent to the care and treatment of Mr. McMaken. The crux of the case is
whether the MRI that was ordered by pain management providers was timely
performed, whether the delay in obtaining the MRI was a breach of the standard care,
and whether the immediate need for an MRI was communicated to residents by Drs.
Saxe and Tchorz. The tenor of the stipulations suggests that plaintiffs doubt whether
residents were made aware of the order for the MRI or the urgency of performing it, but
they are willing to concede that there is no evidence to the contrary. However, the issue
whether the residents were aware of the order or its urgency is an issue for trial and
does not alter the fact that residents were present at the relevant times and that Drs.
Saxe and Tchorz were teaching residents at such times.
{¶ 24} As stated in Theobold, “‘[i]n many instances, the line between [the
physician’s] roles (practicing and teaching) is blurred because the practitioner may be
teaching by simply providing the student or resident an opportunity to observe while the
practitioner treats a patient.’” Id. at ¶16 quoting Theobald v. Univ. of Cincinnati, 160
Ohio App.3d 342, 2005-Ohio-1510, ¶34. In affirming the holding of the Tenth District
Court of Appeals, the Supreme Court agreed that “the question of scope of employment
must turn on what the practitioner’s duties are as a state employee and whether the
practitioner was engaged in those duties at the time of an injury.” Id. at ¶23. The Court
of Appeals had explained that “anytime a clinical faculty member furthers a student or
resident’s education, he promotes the state’s interest. Because the state’s interest is
promoted no matter how the education of the student or resident occurs, a practitioner
is acting within the scope of his employment if he educates a student or resident by
direct instruction, demonstration, supervision, or simple involvement of the student or
resident in the patient’s care.” Theobald, supra, 160 Ohio App.3d 342, 2005-Ohio-1510,
¶47.
{¶ 25} Based upon the parties’ joint stipulations, the court concludes that the
duties of Drs. Saxe and Tchorz as state-employed professors of medicine included
treating patients at defendant university hospital and that they were engaged in those
duties at the time of the alleged negligence. Therefore, the court concludes that Drs.
Saxe and Tchorz were acting within the scope of their state employment at all times
pertinent hereto.
{¶ 26} The joint stipulation of facts is hereby APPROVED and the court finds that
Drs. Saxe and Tchorz are entitled to immunity pursuant to R.C. 2743.02(F) and 9.86.
Therefore, the courts of common pleas do not have jurisdiction over any civil actions
that may be filed against them based upon the allegations in this case.
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
JAMES C. MCMAKEN, et al.
Plaintiffs
v.
WRIGHT STATE UNIVERSITY
Defendant
Case No. 2009-03801
Judge Alan C. Travis
JUDGMENT ENTRY
This case was submitted to the court on a joint stipulation of facts regarding the
civil immunity of Kathryn Tchorz, M.D. and Jonathan Saxe, M.D. Upon review of the
stipulations, and for the reasons set forth in the decision filed concurrently herewith, the
court finds that Kathryn Tchorz, M.D. and Jonathan Saxe, M.D., are entitled to immunity
pursuant to R.C. 9.86 and 2743.02(F) and that the courts of common pleas do not have
jurisdiction over any civil actions that may be filed against them based upon the
allegations in this case.
_____________________________________
ALAN C. TRAVIS
Judge
cc:
Brian M. Kneafsey Jr. John D. Holschuh Jr.
Assistant Attorney General Sarah Tankersley
150 East Gay Street, 18th Floor 600 Vine Street, Suite 2700
Columbus, Ohio 43215-3130 Cincinnati, Ohio 45202
Michael A. Baer
210 West Main Street
Troy, Ohio 45373
LH/cmd/Filed July 12, 2010/To S.C. reporter July 22, 2010 | 01-03-2023 | 08-02-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1017708/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 04-4430
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
CHARLES EDWARD HATTEN,
Defendant - Appellant.
Appeal from the United States District Court for the Southern
District of West Virginia, at Huntington. Robert C. Chambers,
District Judge. (CR-02-232)
Submitted: October 21, 2005 Decided: November 22, 2005
Before WILKINSON, SHEDD, and DUNCAN, Circuit Judges.
Affirmed in part, vacated in part, and remanded by unpublished per
curiam opinion.
Matthew A. Victor, VICTOR, VICTOR & HELGOE, L.L.P., Charleston,
West Virginia, for Appellant. Kasey Warner, United States
Attorney, Miller A. Bushong, III, Assistant United States Attorney,
Beckley, West Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Following a guilty plea to conspiracy to manufacture and
distribute more than fifty grams of methamphetamine, in violation
of 21 U.S.C. § 846 (2000), and using, carrying, and discharging a
firearm in relation to a drug trafficking offense, in violation of
18 U.S.C.A. § 924(c)(1)(A)(iii), (j)(1) (West 2000 & Supp. 2005),
the district court sentenced Charles Edward Hatten to 520 months in
prison. Hatten appeals, arguing that he should be permitted to
withdraw his guilty plea and challenging the validity of his
sentence. We affirm Hatten’s conviction, vacate his sentence, and
remand for resentencing.
Hatten contends that the government breached the plea
agreement by arguing for the application of the murder cross
reference of U.S. Sentencing Guidelines Manual § 2D1.1(d)(1)
(2003). We agree with the district court’s conclusion that the
government did not breach the plea agreement.
The parties are in apparent agreement that Hatten is
entitled to be resentenced in light of United States v. Hughes, 401
F.3d 540 (4th Cir. 2005). Accordingly, although we affirm Hatten’s
conviction, we vacate his sentence and remand for resentencing in
light of Hughes.* Because we are vacating Hatten’s sentence, we
need not address Hatten’s other sentencing claims.
*
Just as we noted in Hughes, “[w]e of course offer no
criticism of the district judge, who followed the law and procedure
in effect at the time” of Hatten’s sentencing. 401 F.3d at 545
n.4.
- 2 -
Even though the Sentencing Guidelines are no longer
mandatory, United States v. Booker, 125 S. Ct. 738 (2005), makes
clear that a sentencing court must still “consult [the] Guidelines
and take them into account when sentencing.” Id. at 767. On
remand, the district court should first determine the appropriate
sentencing range under the Guidelines, making all factual findings
appropriate for that determination. See Hughes, 401 F.3d at 546
(applying Booker on plain error review). The court should consider
this sentencing range along with the other factors described in 18
U.S.C.A. § 3553(a) (West 2000 & Supp. 2005), and then impose a
sentence. Hughes, 401 F.3d at 546. If that sentence falls outside
the Guidelines range, the court should explain its reasons for
imposing a non-Guidelines sentence as required by 18 U.S.C.A.
§ 3553(c)(2) (West Supp. 2005). The sentence must be “within the
statutorily prescribed range and . . . reasonable.” Hughes, 401
F.3d at 546-47.
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 IN PART,
VACATED IN PART,
AND REMANDED
- 3 - | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1593094/ | 53 Wis.2d 275 (1972)
192 N.W.2d 913
HOUSING AUTHORITY OF THE CITY OF MILWAUKEE, Respondent,
v.
MOSBY, Appellant.[*]
No. 162.
Supreme Court of Wisconsin.
Argued November 1, 1971.
Decided January 4, 1972.
*280 For the appellant there were briefs by James A. Walrath, attorney, and Patricia McMahon of counsel, both of Milwaukee, and oral argument by Mr. Walrath.
For the respondent there was a brief by John J. Fleming, city attorney, and Michael J. McCabe, assistant city attorney, and oral argument by Mr. McCabe.
BEILFUSS, J.
The appellant, Harriett Mosby, has raised several issues in her brief filed in support of her appeal, namely: (1) The court applied the wrong standard, (2) the evidence is insufficient to support the findings, and (3) the tenant was denied due process because she was not given a pre-eviction administrative hearing. The appellant also asserts an additional issue has arisen after the appeal was taken because of a HUD administrative order dated February 22, 1971, which regulation provides for an administrative hearing. She claims the regulation must be applied retroactively.
Because we believe the questions of due process and the retroactivity of the February 22, 1971, regulation are controlling, we will only discuss briefly the first two issues.
The respondent housing authority, through the city attorney, concedes that a public housing tenant is entitled to a due process hearing as to the reasons for eviction in unlawful detainer proceedings consistent with governmental regulations concerning public housing. Our unlawful detainer statute, sec. 291.07, Stats. 1967, provides in part:
"Proceedings and pleadings. After the return of the summons served as above provided, and at the time and place named therein, if the defendant appear he may answer the complaint; and all matters in excuse, justification or avoidance of the allegations of the complaint must be answered specifically; . . ."
*281 This section, together with the rationale expressed in Dickhut v. Norton (1970), 45 Wis. 2d 389, 173 N. W. 2d 297, of allowing defenses based upon public policy, is broad enough to accommodate a defense based upon a federal public housing regulation.
The appellant Mosby contends the court did not apply the right standard to the conduct of Harriett Mosby in the de novo trial. The trial court's memorandum decision of May 22, 1970, did state the issues to be determined at the trial were (1) whether Harriett Mosby failed to maintain her apartment in a reasonable and clean condition, and (2) whether the housing authority acted in an arbitrary and capricious manner in terminating the tenancy.
Appellant contends that by virtue of a HUD circular dated December 17, 1968, the standard should have been ". . . whether the conduct of such tenants does or would be likely to interfere with other tenants in such a manner as to materially diminish their enjoyment of the premises."
We think the record clearly reveals that the trial judge did apply the standard the appellant Mosby contends was required. In the findings of fact given after the trial, the trial judge stated: ". . . Now, the Court on those violations would have to find that these violations would constitute a failure to keep the standard of care set by the Housing Authority and that those violations were detrimental to other tenants . . . ."
The appellant Mosby also contends the evidence was insufficient to show conduct on her part in the cleanliness and maintenance of the apartment was detrimental to other tenants. The credibility of the witnesses and the weight of the testimony are for the trier of the facts and if there is any credible evidence to sustain the findings of fact we will not disturb them upon appeal.
*282 We have reviewed the record. We do not intend to discuss the evidence nor the findings, except to state our conclusions that there is ample credible evidence to sustain the findings that the premises were not kept as clean as they reasonably should have been, nor were they maintained in such a condition as reasonably required by the rental agreement; that the authority did not act in an arbitrary or capricious manner; and that the conduct of the appellant Mosby in the care and maintenance of the apartment was detrimental to other tenants.
The appellant Mosby further contends she was denied due process of law because she was not afforded a pre-eviction administrative due-process-type hearing with notice, statement of charges and right to counsel. The trial judge, in an able and helpful memorandum decision, concluded that a public housing tenant was entitled to an adversary type of hearing with notice, reasons for eviction, and right to counsel, and that such a hearing could be afforded the appellant in the trial de novo which was granted to her.
Judge FOLEY concluded that under the HUD circular of February 7, 1967, the appellant was entitled to notice of the reasons for eviction and an opportunity to reply in private conference, and that this requirement was mandatory by virtue of a decision of the United States Supreme Court in Thorpe v. Housing Authority (1969), 393 U. S. 268, 89 Sup. Ct. 518, 21 L. Ed. 2d 474. Judge FOLEY further concluded that the informal conference provided for in the HUD circular of February 7, 1967, did not meet the requirements of due process (see Goldberg v. Kelly (1970), 397 U. S. 254, 90 Sup. Ct. 1011, 25 L. Ed. 2d 287), and for that reason conducted a trial de novo wherein the due process requirements of notice of reasons for eviction and adversary hearing were extended to the appellant. The housing authority, in addition to proving notice of termination, was required to show its reasons for eviction and the violations of the rental agreement; *283 that she was given notice of reasons and an opportunity to discuss the matter with the housing manager and that his action was not arbitrary or capricious; and that the conduct of the appellant did have a detrimental effect upon other tenants in the housing project. The appellant, Harriett Mosby, was afforded due process.
If we were not required to consider the retroactive effect of another HUD circular issued February 25, 1971, we would affirm the judgment appealed from without hesitation. (The judgment was entered June 26, 1970, and the appeal record was filed in this court September 3, 1970, both several months before the February, 1971, circular. The case was argued in this court on November 1, 1971, and the decision is announced on this day, January 4, 1972.)
A question as to the effect of a HUD circular was raised at oral argument. We conclude it is a valid enforceable rule that has the force of law. In Thorpe, supra, the United States Supreme Court, in reaffirming the HUD circular of February 7, 1967, referred to above, states at pages 274, 275:
"Pursuant to its general rule-making power under sec. 8 of the United States Housing Act of 1937, HUD has issued a Low-Rent Management Manual, which contains requirements that supplement the provisions of the annual contributions contract applicable to project management. According to HUD, these requirements `are the minimum considered consistent with fulfilling Federal responsibilities' under the Act. Changes in the manual are initially promulgated as circulars. These circulars, which have not yet been physically incorporated into the manual, are temporary additions or modifications of the manual's requirements and `have the same effect.' . . ."
The HUD circular of February 22, 1971, contains the following provision:
"3. REQUIREMENTS. Each local housing authority shall adopt procedures or revise existing grievance procedures *284 to embody, as a minimum, the following standards and criteria:
"a. A tenant shall be afforded an opportunity for a hearing before an impartial official or a hearing panel if he disputes within a reasonable time any LHA action or failure to act in accordance with the lease requirements, or any LHA action or failure to act involving interpretation or application of the LHA's regulations, policies or procedures which adversely affect the tenant's rights, duties, welfare or status.
". . .
"e. The tenant shall be afforded an opportunity to present his side of the dispute, including the opportunity to be represented by counsel or another person of his choice, to bring in witnesses and to confront and cross-examine witnesses in appropriate circumstances."
We conclude that this provision does not change the terms of the lease used by the parties to this action, nor does it prevent the housing authority from evicting a tenant who does not comply with the terms of the lease. It only provides for an administrative method of advising tenants of violations and making factual determinations of whether such violations exist and whether they are of such nature as to require eviction. It also provides a means whereby a neutral person or body of persons can attempt to discuss the problems with the objective of saving the tenancy. Eviction is hardly consistent with public interest in providing housing for low income persons. This procedure promotes the underlying objectives of providing low-rent public housing in the first instance. We conclude the hearing requirement of the HUD circular of February 22, 1971, is valid and mandatory upon the housing authority. See Thorpe, supra.
The crucial issue is whether the HUD circular of February 22, 1971, must be applied retroactively in this case.
In Thorpe, supra, a tenant had been evicted from her public housing apartment by the housing authority. The authority refused to state any reason for the eviction. *285 The tenant was given a trial de novo in the superior court which affirmed the eviction. The Supreme Court of North Carolina also affirmed. The United States Supreme Court, at page 272, granted certiorari to consider "whether petitioner was denied due process by the Housing Authority's refusal to state the reasons for her eviction and to afford her a hearing at which she could contest the sufficiency of those reasons."
While the petitioner's case in Thorpe, supra, was pending, HUD passed a circular which stated that housing authorities must inform the tenant in a private conference or other appropriate manner of the reasons for eviction. Id. at page 272. The court remanded the case to the North Carolina Supreme Court for reconsideration of the case in light of the HUD circular. That court reaffirmed its prior holding, stating that the circular's directive would be applied only prospectively. The United States Supreme Court again granted certiorari and held that the HUD circular must be applied retroactively in any case where the tenant still resided in the project on the date of decision.
The court stated, at page 282:
"`[I]f subsequent to the judgment and before the decision of the appellate court, a law intervenes and positively changes the rule which governs, the law must be obeyed, or its obligation denied. If the law be constitutional, . . . I know of no court which can contest its obligation. It is true that in mere private cases between individuals, a court will and ought to struggle hard against a construction which will, by a retrospective operation, affect the rights of parties, but in great national concerns . . . the court must decide according to existing laws, and if it be necessary to set aside a judgment, rightful when rendered, but which cannot be affirmed but in violation of law, the judgment must be set aside.'"
In Glover v. Housing Authority of City of Bessemer, Ala. (5th Cir. 1971), 444 Fed. 2d 158, the precise issue *286 present in the instant case was ruled upon by the fifth circuit. The court held that even though the tenant plaintiff had received the benefit of an evidentiary hearing in the district court, an administrative hearing must be granted to the plaintiff. In support of this holding, the court stated at pages 161, 162:
"The Authority argues further that there is no need for a Housing Authority hearing in this case because the district court conducted an evidentiary hearing. But we think this argument misses the point that it is a hearing within the administrative framework to which Mrs. Glover is entitled. As this Court said about due process rights to a hearing in a case contesting the discharge of school teachers who asserted this was retaliation for an exercise of first amendment rights,
"The District Court hearing does not, in this case, supplant the necessity for employment by the board of appropriate procedures. . . . The localized, less formalized, less adversary atmosphere of the board is the best forum to adjudicate and ameliorate problems of teacher rehiring to the mutual acceptability, if not the full satisfaction, of board and teacher. Abdication to the courts may be the short way across, but it may be the long way around, as in this case. . . . The hearing which we require is one nunc pro tunc. . . .
"Lucas v. Chapman, 5 Cir. 1970, 430 F. 2d 945, 948."
A question has been raised concerning the possibility of double judicial review of the administrative determination. We deem that only one administrative-type hearing is required (either before a hearing officer or hearing panel as provided by the circular), and that ample and adequate rights of judicial review of the administrative action are available to an aggrieved tenant through the unlawful detainer procedures as provided by statute and no double judicial review is required.
We therefore hold that the HUD circular of February 22, 1971, insofar as it provides for a pre-eviction administrative hearing, is retroactive as to this case and as to *287 any other similar public housing tenants who have been ordered evicted but are still in possession on the date of this decision. The HUD circular of February 22, 1971, shall not be applied retroactively to former tenants not in possession of the premises on this date. To do so would probably disrupt present low income tenants in public housing and, as such, would be inconsistent with the basic purposes of public housing for low income persons.
The judgment providing for eviction and writ of restitution is reversed and remanded with directions to dismiss the complaint but with leave to the housing authority to reinstitute eviction procedures consistent with the opinion.
By the Court.Judgment reversed and cause remanded with directions.
ROBERT W. HANSEN, J. (dissenting.)
The majority holds that a printed circular of a federal government agency must be given retroactive application. If Congress were to alter the requirements for admission to federal housing projects, would such Act of Congress have retroactive applicability, giving a cause for damages to one properly excluded under the law in existence at the time of the denial of right to become a tenant? If the Wisconsin legislature were to change the manner in which unlawful detainer cases are processed in court, would such new state law be applied retroactively to invalidate proceedings in exact accord with the then existing law? If the city of Milwaukee were to pass an ordinance changing the procedure for proceeding against building code violators, would this affect cases commenced or concluded under the prior ordinance? The general rule has been that, in the absence of specific provision therefor, the law does not favor retroactive application of new legislation.[1] The majority finds a new rule in a recent decision *288 of the United States Supreme Court,[2] and sees it as requiring here the setting aside of the full judicial hearing because, subsequent to such judicial hearing, the housing and urban development agency (HUD) issued a circular providing for administrative hearings in housing project evictions.
The majority opinion sets forth that certiorari was granted in Thorpe to consider "`whether petitioner was denied due process by the Housing Authority's refusal to state the reasons for her eviction and to afford her a hearing at which she could contest the sufficiency of those reasons.'" It is against this background of reason for taking jurisdiction that the Thorpe Case must be considered and the decision held to the fact situation before the court. There the issue was not one type of hearing contrasted with another. It was rather a question of hearing or no hearing at all. It is true that in Thorpe a HUD circular requiring housing authorities to inform tenants "in a private conference or other appropriate manner" of the reasons for eviction, although issued while the Thorpe Case was pending, was given retroactive application. But, in the light of a subsequent decision of the high court,[3] it is difficult to believe that the result would have been different if no such circular requiring the stating of reasons for eviction had been issued. Statutory construction of the public housing statutes, public policy and constitutional assurances, support the insistence that tenants in public housing projects know why what is to happen to them is to happen and that they have the right to contest reasons given and eviction. The HUD circular did no more than provide for what the housing law already intended and due process already requiredthat reasons be given for eviction of public housing tenants.
*289 It is a long step beyond Thorpe, as we see it, to hold that a full judicial hearing, with all reasons for eviction disclosed and established, and the opportunity to contest the sufficiency of those reasons provided, is invalidated by a subsequently distributed circular providing for administrative hearings. As to due process, the judicial hearing surely assures tenants both the disclosure of reasons for eviction, and the opportunity to contest, as surely as would an administrative hearing by the agency. It is true that one federal appeals court has, quoting from an earlier case of its own involving teacher rehiring, indicated its preference for administrative-type hearings as the "best forum to adjudicate and ameliorate problems of teacher rehiring," and rejected a full judicial hearing as an adequate substitute.[4] The majority accepts that result and perhaps the leaning toward administrative rather than judicial hearings. We find far more persuasive and convincing the reasoning and rationale of the decision of another federal appeals court in a case involving the eviction of a tenant from a city housing authority project.[5] There the appeals court found that the public housing tenant, whom the city housing authority sought to remove from her quarters, was not entitled to declaratory and injunctive relief on her theory that the housing authority was required to hold an administrative evidentiary hearing where, under the state law, the housing authority, if it sought to obtain an eviction order, must prove allegations in court at full trial in which the tenant may demand a jury.
Since it was not necessary to require an administrative hearing to insure due process or full hearing, that being insured by the provision for judicial hearing, the fourth circuit court of appeals concluded that the case then fit into the statement in Thorpe that:
*290 ". . . Moreover, even if the Authority does not provide such a hearing, we have no reason to believe that once petitioner is told the reasons for eviction she cannot effectively challenge their legal sufficiency in whatever eviction proceedings may be brought in the North Carolina courts. . . ."[6]
In the case before us the appellant was afforded a full judicial hearing in which she, through counsel, fully participated. Adequate notice, reasons for eviction and full opportunity to contest were part of such judicial hearing. Of this appellant, as of petitioner in the Johnson v. Tamsberg Case, it can fairly be said: "Any substantial due process grievance that plaintiff might have had when she filed her complaint was mooted by the plenary hearing that she was afforded."[7] Of the case before us, as was pointed out in the fourth circuit case, it can be said that: "There is no contention that the court hearing was inadequate in scope or that the notice provided was insufficient to enable plaintiff's counsel to prepare for it. . . . We have been offered no suggestion that the plaintiff was in any way disadvantaged [by the South Carolina policy of providing a hearing in court rather than before an administrative tribunal] or that the result in this case would have been different had the Housing Authority itself held the hearing. Hence, the question is, at least on this record, purely academic."[8] We agree. Where the appellant was given a full judicial hearing, with adequate notice and full opportunity to contest the reasons given for eviction, her participation in such judicial hearing makes unreasonable and untenable her claim that retroactive application of a federal agency circular would or could give her anything more than she has been afforded. No substantial right being involved, we hold that the question *291 of retroactivity is, at least on this record, "academic." We would affirm.
I am authorized to state that Mr. Justice LEO B. HANLEY joins in this dissent.
NOTES
[*] Motion for rehearing denied, with costs, on February 29, 1972.
[1] See: 50 Am. Jur., Statutes, p. 495, sec. 478.
[2] Thorpe v. Housing Authority (1969), 393 U. S. 268, 89 Sup. Ct. 518, 21 L. Ed. 2d 474.
[3] Goldberg v. Kelly (1970), 397 U. S. 254, 90 Sup. Ct. 1011, 25 L. Ed. 2d 287, requiring due process safeguards as to the analogous situation of terminating welfare benefits.
[4] Glover v. Housing Authority of City of Bessemer, Ala. (5th Cir. 1971), 44 Fed. 2d 158, citing Lucas v. Chapman (5th Cir. 1970), 430 Fed. 2d 945, 948.
[5] Johnson v. Tamsberg (4th Cir. 1970), 430 Fed.2d 1125, 1127.
[6] Thorpe v. Housing Authority, supra, at page 284.
[7] Johnson v. Tamsberg, supra, at page 1127.
[8] Id. at page 1127. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/728132/ | 98 F.3d 1069
36 Fed.R.Serv.3d 711
Kristi D. ANDREWS, Plaintiff-Appellant,v.Randy Alan FOWLER, individually and in his capacity as anofficer with the City of North Sioux City, SouthDakota, Defendant,Scott Price, individually and in his capacity as formerChief of Police of the City of North Sioux City, SouthDakota Police Department; William C. Merrill, individuallyand in his capacity as Mayor of the City of North SiouxCity, South Dakota; City of North Sioux City, South Dakota,Defendants-Appellees.
No. 95-3917.
United States Court of Appeals,Eighth Circuit.
Submitted June 13, 1996.Decided Oct. 23, 1996.
Michael F. Marlow, Yankton, SD, argued, for Plaintiff-Appellant.
Gary P. Thimsen, Sioux Falls, SD, argued (Tim R. Shattuck, on the brief), for Defendants-Appellees.
Before HANSEN, ROSS, and JOHN R. GIBSON, Circuit Judges.
HANSEN, Circuit Judge.
1
Kristi Andrews brought this civil rights action, alleging causes of action pursuant to 42 U.S.C. § 1983, 42 U.S.C. § 1985(3), and state law, arising out of a sexual assault by Randy Fowler, a former police officer for the North Sioux City Police Department. The district court granted summary judgment in favor of former Chief of Police Scott Price, Mayor William Merrill, and North Sioux City, South Dakota. In this appeal, Andrews contends that the district court erred in granting summary judgment, because (1) genuine issues of material fact exist on her § 1983 claim that these defendants failed to properly hire, train, and supervise Fowler and failed to act on or investigate complaints; (2) genuine issues of material fact exist on her § 1985(3) conspiracy claim; and (3) the district court erred in denying her request to take additional depositions. We affirm in part and reverse in part.
I.
2
The record, viewed in the light most favorable to Andrews, supports the following set of facts. In the early morning hours of June 8, 1991, Andrews was raped by Randy Fowler, who was then a police officer for the North Sioux City Police Department. At the time, Andrews was a 17-year-old and had been drinking. She had recently graduated from high school and was preparing to enter basic training for the military.
3
Earlier the same evening, during a going-away party for Andrews at her home, police were called to the scene because of underage drinking and reports of several arguments at the party. Fowler took an interest in Andrews, which Chief of Police Scott Price noticed. After the police left the scene, Price called all three of his officers back to the police department where he warned them not to fraternize while on duty, especially not with minor females. Price was aware that the department had had trouble in the past with some officers fraternizing with and possibly even having sexual relations with minor females. Those officers had been discharged before Price became chief of police and before any of Price's officers had been hired. Price had, however, received numerous complaints that one of his officers had been stopping females for minor traffic violations or no violation at all, asking them out on dates, and offering not to issue citations if they would agree to go on a date with or to provide their telephone number to the officer. Therefore, Price warned his officers to avoid such conduct.
4
Later on June 8, 1991, while Fowler was still on duty, he returned to Andrews' home on another call reporting a disturbance at the address. He invited Andrews into his police car. They drove away from Andrews' home and parked the police car in a spot where the two talked for some time. Fowler offered to take Andrews home when his shift was over. At that time, Fowler exchanged his police car for his personal vehicle, but instead of taking Andrews home, Fowler took her to an isolated area. There, he forced her to have sexual intercourse with him under threats that he would charge her with underage drinking and prevent her from being allowed into the military if she did not cooperate with his advances. Andrews told no one of the assault.
5
During the next few weeks, while Andrews was away at basic training, her mother, Dixie Anderson, began to hear rumors that Randy Fowler was bragging about having had sexual relations with Andrews and that he knew she had no tan lines. When her mother reported this to Andrews in a brief telephone conversation, Andrews replied, "I can't go into detail. Just press charges." (Appellant's App. at 39.) Dixie Anderson then went to Chief of Police Price, who had already heard the rumor of Fowler's boasts from another officer. Anderson informed Price that if there had been sexual relations between her daughter and Fowler, it was not consensual and she wanted to press charges. Price confronted Fowler with the accusation, and he denied having had any sexual relations with Andrews. Price did not investigate the incident further, and Anderson did not pursue the matter.
6
In early July, Fowler sexually assaulted another woman, Bonnie Bell, threatening to charge her with a crime if she did not acquiesce to his sexual demands. Ms. Bell told Officer Greg Hanson about the incident but did not make a formal complaint. Officer Hanson told Chief Price about the incident, but Price did not investigate. Ultimately, on August 3, 1991, Price wrote up an evaluation of Fowler to present to the city council when he requested Fowler's termination. The evaluation included some reference to the Andrews incident, to reports that Fowler had been stopping young females and asking them out on dates instead of issuing citations, and to Fowler's dates with another 17-year-old girl against Price's orders. The evaluation also noted Fowler's lack of reliability, often failing to respond to radio requests for back-up help. Price presented a copy of the evaluation to the mayor and met with the mayor and the city council on August 5, 1991, to discuss terminating Fowler's employment. The city council immediately requested Fowler's resignation, and he complied.
7
Andrews' mother, Dixie Anderson, testified that she decided not to pursue the criminal prosecution of Fowler because she had heard of his discharge and assumed that there was nothing more she could do. Three years later, at the instigation of then Chief of Police Skip Ensley who investigated these matters, Fowler was prosecuted for raping Kristi Andrews. The Supreme Court of South Dakota recently affirmed Fowler's conviction of second-degree rape. State v. Fowler, 552 N.W.2d 92 (S.D.1996). In another criminal case, Fowler was convicted of attempted second-degree rape, simple assault, and sexual contact all arising from his assault of Bonnie Bell, which occurred approximately one month after he raped Andrews. State v. Fowler, 552 N.W.2d 391 (S.D.1996).
8
Andrews brought this civil rights suit against Fowler, Chief of Police Price, Mayor Merrill, and the city based on the incident. Andrews asserted a § 1983 cause of action based on Fowler's conduct and the other defendants' failure to properly hire, supervise, or train Fowler, as well as their failure to investigate complaints against him. Andrews asserted a § 1985(3) cause of action, claiming that the defendants conspired to deprive her of her constitutional rights by covering up Fowler's misconduct. Andrews also asserted South Dakota state law claims of assault and battery, intentional infliction of severe emotional distress, and negligence.
9
The district court granted summary judgment to Price, Merrill, and the city, concluding that there is no genuine issue of material fact on the § 1983 claims or on the § 1985(3) conspiracy claim. As to the state law claims, the district court concluded that they are not available because Andrews did not comply with the statutory notice requirement. See S.D. Codified Laws Ann. § 3-21-2 (1994). The district court granted partial summary judgment in favor of Fowler, dismissing the § 1985(3) conspiracy claim and the state law assault and battery claim against him. Trial against Fowler on the remaining claims is stayed pending final disposition of this appeal, in which Andrews challenges the grant of summary judgment in favor of Price, Merrill, and the city.
II.
10
"We review the district court's grant of summary judgment de novo, applying the same standard as the district court and examining the record in the light most favorable to the nonmoving party." Barge v. Anheuser-Busch, Inc., 87 F.3d 256, 258 (8th Cir.1996). Summary judgment is appropriate when the record reveals that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Disesa v. St. Louis Community College, 79 F.3d 92, 94 (8th Cir.1996). See Fed.R.Civ.P. 56(c). Summary judgment is also appropriate when the plaintiff has failed to make a sufficient showing of the existence of an essential element of her case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986).
A.
11
Andrews first contends that the district court erred by granting summary judgment to Price, Merrill, and the city on her § 1983 claim. On appeal, she contends that she has raised a material dispute of fact concerning whether these defendants failed to properly hire, train, and supervise Fowler or to investigate complaints against him.
1.
12
We begin with Andrews' arguments challenging the district court's grant of summary judgment to the city.
13
a.
14
"[A] local government may not be sued under § 1983 for an injury inflicted solely by its employees or agents" on a theory of respondeat superior. Monell v. Dep't of Social Servs. of the City of New York, 436 U.S. 658, 694, 98 S.Ct. 2018, 2037-38, 56 L.Ed.2d 611 (1978). The city may be subject to § 1983 liability for failing to act on complaints of sexual misconduct by police department employees only if it had a "policy or custom" of failing to act upon prior similar complaints of unconstitutional conduct, which caused the constitutional injury at issue. Id. There must exist a prior pattern of unconstitutional conduct that is so "persistent and widespread" as to have the effect and force of law. Id. at 691, 98 S.Ct. at 2036; Thelma D. v. Board of Educ., 934 F.2d 929, 932-34 (8th Cir.1991); Jane Doe A. v. Special Sch. Dist. of St. Louis County, 901 F.2d 642, 645-46 (8th Cir.1990). "To establish a city's liability based on its failure to prevent misconduct by employees, the plaintiff must show that city officials had knowledge of prior incidents of police misconduct and deliberately failed to take remedial action." Parrish v. Luckie, 963 F.2d 201, 204 (8th Cir.1992). See also Harris v. Pagedale, 821 F.2d 499, 504 (8th Cir.), cert. denied, 484 U.S. 986, 108 S.Ct. 504, 98 L.Ed.2d 502 (1987).
15
We agree with the district court's conclusion that Andrews failed to demonstrate a city policy or custom of failing to act on or investigate prior complaints of sexual abuse by police officers. The evidence demonstrates that prior to the time either Price or Fowler was on the police force, three officers had been asked to resign due to their relations with minor females in the community. In each of those prior instances, however, the mayor and city council members took immediate action to request the officer's resignation when informed of the officer's misconduct. Contrary to Andrews' contention, these instances are strong evidence that the city had a policy or custom of taking adequate remedial action to remove police officers accused of sexual misconduct with minors. Likewise, in this case, when Chief of Police Price brought Fowler's misconduct to the city council's attention and requested his termination, the council immediately acted to request Fowler's resignation.
16
Andrews contends that she raised a question of fact because testimony also indicated that council members, the mayor, and Price had heard rumors during Fowler's tenure that an officer had been harassing women by stopping them for minor traffic offenses or no offense at all and asking them on dates or for their telephone numbers. The offers to forgive citations were allegedly laden with sexual overtones. Some council members said that they passed such rumors on to Price and Mayor Merrill, although they could not say if they had passed on any information prior to Andrews' rape. Price admitted that he had heard the rumors, but he had not received any formal complaints, and he was not certain which officer was engaging in this conduct because none of the hearsay reports identified a particular officer. Consequently, Price placed Fowler and Officer Greg Hanson (who look quite a bit alike) in separate, differently colored cars in an attempt to determine the source of the improper conduct. This evidence does not indicate a city custom or policy of failing to act on prior complaints. Rather, it demonstrates that even in the face of mere rumors, some remedial action was taken to try to identify the source. Furthermore, the evidence is uncontroverted that on the very night that Fowler raped Andrews, Price had specifically cautioned all of his officers to avoid fraternizing with minor females.
17
Andrews also presented evidence of two specific complaints against Fowler prior to her rape which she contends the city ignored. In May 1991, the father of a young woman named Angie Zortman filed a complaint against Fowler. Apparently, late one night while her parents were away from home, Fowler was found prowling around inside Zortman's home. He fled after encountering her younger sister. The next day, Zortman's father complained to Price about Fowler's behavior. The dispatch card indicates that Fowler went to the Zortman home around 1:30 a.m. on a complaint of loud noise and a party. Police records also indicate that Price was dispatched to the Zortman residence the following day in reference to Mr. Zortman's complaint. There is no evidence that Price took any disciplinary action against Fowler based on the incident.
18
Additionally, testimony indicates that in early June 1991, Michael Kougl made a complaint to Price about Fowler's conduct toward the female driver of a car in which he was a passenger. Fowler allegedly stopped the vehicle for a minor violation and suggested to the female driver in a manner laden with sexual overtones that he could take care of the ticket. Again, there is no evidence that Price took any disciplinary action against Fowler. In fact, Fowler's personnel file is missing, as are all records of complaints prior to May 1991.
19
These two instances of misconduct indicate that Chief of Police Price was aware that some problem existed with Fowler, but they do not indicate a "persistent and widespread" pattern of misconduct that amounts to a city custom or policy of overlooking police misconduct. Monell, 436 U.S. at 691, 98 S.Ct. at 2036. Price's failure to take remedial action in these two instances simply is an insufficient basis on which to subject the city to liability.
20
The two specific prior complaints against Fowler and the various rumors that do not implicate a particular officer pale in comparison to the type of prior complaints that we have previously held supported a verdict against a city. In Parrish v. Luckie, 963 F.2d at 204-05, the evidence of prior complaints indicated that the offending police officer had engaged in repeated acts of violence, had been charged with child abuse, and had repeatedly requested sexual favors, including oral sex, from convenience store clerks, all prior to the time he raped Parrish; furthermore, there was evidence that the police department had a policy of investigating only written complaints and that the department discouraged citizens from filing written complaints of physical or sexual assault by officers. In Harris v. City of Pagedale, 821 F.2d at 501-03, the evidence of prior complaints was that the offending officer had fondled a young woman in a dark room at the police station, made deals with another woman (several times) that he would not charge her if she cooperated by going to a hotel room with him or allowing him to tie her up and photograph her nude, and offered to let a woman go free from drug charges in exchange for sex, to which she consented for fear of her life; there also had been complaints of violence and sexual assault by other police officers.
21
The prior complaints of physical or sexual assault in Parrish and Harris were quite similar to the type of officer misconduct that caused the constitutional deprivation actually suffered by the plaintiffs in those two cases. See Harris, 821 F.2d at 508 (holding city liable where the "assault was similar to many other sexual violations committed by Officer Hayles and by other City police officers"). In this case, however, there is no evidence that the city ever had received, or had been deliberately indifferent to, complaints of violence or sexual assault on the part of an officer prior to the time Fowler raped Kristi Andrews. Accordingly, we conclude that the district court did not err by granting summary judgment to the city on Andrews' failure to investigate the claim.
22
b.
23
A city also may be liable for deficient policies regarding hiring and training police officers where (1) the city's hiring and training practices are inadequate; (2) the city was deliberately indifferent to the rights of others in adopting them, such that the "failure to train reflects a deliberate or conscious choice by a municipality," City of Canton v. Harris, 489 U.S. 378, 389, 109 S.Ct. 1197, 1205, 103 L.Ed.2d 412 (1989); and (3) an alleged deficiency in the city's hiring or training procedures actually caused the plaintiff's injury. See Larson By Larson v. Miller, 76 F.3d 1446, 1454 (8th Cir.1996) (en banc); Benavides v. County of Wilson, 955 F.2d 968, 972 (5th Cir.), cert. denied, 506 U.S. 824, 113 S.Ct. 79, 121 L.Ed.2d 43 (1992). It is necessary to show "that in light of the duties assigned to specific officers or employees the need for more or different training is so obvious, and the inadequacy so likely to result in the violation of constitutional rights, that the policymakers of the city can reasonably be said to have been deliberately indifferent to the need." City of Canton, 489 U.S. at 390, 109 S.Ct. at 1205. In other words, the plaintiff must demonstrate that the city "had notice that its procedures were inadequate and likely to result in a violation of constitutional rights." Thelma D., 934 F.2d at 934.
24
The training procedures for the North Sioux City Police Department consisted of approximately two weeks of on-the-job training with another officer, and officers were sent to the police academy for training within one year of when they were employed by the department. Those officers who did not pass the academy training were not retained. There is no reason to conclude that this training is constitutionally deficient. See Williams-El v. Johnson, 872 F.2d 224, 230 (8th Cir.) (finding training was adequate against a charge of excessive force and denial of medical care where the city provided on-the-job training and required attendance at the police academy), cert. denied, 493 U.S. 871, 110 S.Ct. 199, 107 L.Ed.2d 153 and 493 U.S. 824, 110 S.Ct. 85, 107 L.Ed.2d 51 (1989). In light of the regular law enforcement duties of a police officer, we cannot conclude that there was a patently obvious need for the city to specifically train officers not to rape young women. Moreover, even if the training was in some manner deficient, "the identified deficiency in a city's training program must be closely related to the ultimate injury" such that "the deficiency in training actually caused the police officers' " offending conduct. City of Canton, 489 U.S. at 391, 109 S.Ct. at 1206. Andrews simply cannot demonstrate the close relationship necessary to conclude that the city's failure to properly train Fowler caused him to rape Andrews or even raises a question of fact as to causation.
25
The city's hiring policies were to place a notice of the opening in newspapers, to require completion of a standard application form, to conduct an international background check and a National Crime Information Center Computer Check, and to have a personal interview with selected applicants. The city's Personnel Policy Manual also required prospective employees to submit to a physical and psychological examination before being employed by the city.
26
In this case, the evidence demonstrates that Fowler's application was screened by the council, the police chief, and the mayor. He was interviewed for a part-time position and later appointed as a full-time officer. The international background check and national criminal computer check reported no negative information about Fowler's background. Andrews alleges that the hiring procedure was deficient because Fowler was not required to undergo a psychological evaluation, the city did not check his prior employment record, and the city did not verify the status of his military discharge.
27
While the actual hiring process given to Fowler's application may not have fully conformed to the city's official policy, this failure in one instance does not render the hiring policies unconstitutional. As Andrews contends, Fowler falsely stated on his application that he received an honorable discharge from the military, when in fact at the time he signed his application, January 2, 1991, his record reflected a general discharge.1 The city's failure to discover a dishonest statement on Fowler's employment application, however, does not demonstrate deliberate indifference sufficient to subject it to liability for Fowler's subsequent act of violence. The city followed through with a background check of Fowler's criminal record, which revealed no adverse information, and his educational qualifications rendered him fit for the position. As Andrews contends, the city did not verify Fowler's previous employment history, but there is no evidence that any complaints were voiced against Fowler at jobs he listed on his employment application. (Skip Ensley, a subsequent police chief, testified that he had discovered complaints about Fowler at his previous jobs, but not specifically at any job Fowler listed on his employment application.) A negligent failure to check every reference or every past employment record does not evidence deliberate indifference on the part of the city. See Stokes v. Bullins, 844 F.2d 269, 273 (5th Cir.1988) (noting "mere negligence will not ultimately be a sufficient basis for § 1983 municipal liability" ). We conclude that the district court properly granted the city summary judgment on this issue as well.
2.
28
Price and Merrill may be subject to individual liability under § 1983 as supervisors for failing to adequately receive, investigate, or act upon complaints of sexual misconduct by police department employees if they:
29
(1) Received notice of a pattern of unconstitutional acts committed by subordinates;
30
(2) Demonstrated deliberate indifference to or tacit authorization of the offensive acts;
31
(3) Failed to take sufficient remedial action; and
32
(4) That such failure proximately caused injury....
33
Jane Doe A., 901 F.2d at 645.
34
Also, a supervisor may be held individually liable under § 1983 if he directly participates in a constitutional violation or if a failure to properly supervise and train the offending employee caused a deprivation of constitutional rights. Tilson v. Forrest City Police Dep't, 28 F.3d 802, 806 (8th Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 1315, 131 L.Ed.2d 196 (1995). The plaintiff must demonstrate that the supervisor was deliberately indifferent to or tacitly authorized the offending acts. Id. at 807. This requires a showing that the supervisor had notice that the training procedures and supervision were inadequate and likely to result in a constitutional violation. Thelma D., 934 F.2d at 934.
35
a.
36
We first assess the evidence against former Chief of Police Price. We have already recounted the evidence of Price's actions as Chief of Police. As noted above, while this evidence does not create a persistent and widespread pattern of misconduct, as is necessary to subject the city to liability for a municipal policy or custom, the two complaints against Fowler create a question of fact concerning whether Price was individually aware of a pattern of problems with Fowler.
37
A question of fact also exists as to deliberate indifference or tacit authorization on the part of Price and his failure to take remedial action. Although Price placed Fowler and Hanson in different cars to identify the source of complaints and warned the officers against fraternizing with minors on the very night that Fowler raped Andrews, there is no evidence that he took any disciplinary action against Fowler once he knew of complaints against Fowler specifically. Two officers submitted affidavits attesting that Price knew of Fowler's misconduct and took no action. Price admitted that he had heard locker-room-type talk about Fowler's relations with Andrews after the rape, yet he took Fowler's word when Fowler denied the incident. When told of Fowler's assault against Bonnie Bell the next month, Price responded, "I wouldn't doubt it, that little weasel," referring to Fowler (Appellant's App. at 186), but again he took no action to either discipline or investigate Fowler until he sought Fowler's termination in early August 1991. We conclude that Andrews has demonstrated the existence of a genuine issue of material fact for trial concerning Price's individual liability under § 1983 for failure to act on prior complaints of Fowler's misconduct and failure to adequately supervise Fowler.
38
The failure to train allegation against Price in his individual capacity fails for the same reasons articulated in the above discussion regarding municipal liability. The procedures were not inadequate and causation is lacking as well. We will not repeat the discussion here.
39
Andrews also appears to argue that she was injured by Price's failure to investigate her rape. We find this claim to be without merit. While Price's inaction after learning of Andrews' rape may be continuing evidence of his attitude of tacit authorization or failure to take remedial action, no further constitutional injury resulted to Andrews from this failure. Andrews never reported the incident herself and although she instructed her mother to "press charges," she did not inform her mother of the exact nature of the charge. Further, her mother decided not to pursue the matter. While Price's failure to investigate the rape may have violated state law and common sense, it did not rise to the level of a separate constitutional violation of Andrews' rights. She made no showing that the alleged failure to investigate was on account of her gender so the claim does not implicate equal protection. See Gomez v. Whitney, 757 F.2d 1005, 1006 & n. 1 (9th Cir.1985) (stating "we can find no instance where the courts have recognized inadequate investigation as sufficient to state a civil rights claim unless there was another recognized constitutional right involved").
40
b.
41
The evidence Andrews offers in support of individual liability on the part of Mayor Merrill is insufficient to survive summary judgment. Merrill took office as mayor in May 1991. There is no evidence that he received or was aware of any complaints against Fowler until August 5, 1991, when Price sought to have Fowler discharged from his employment with the police department.2 The evidence indicates that Merrill may have had general knowledge that, prior to the time Fowler was hired, there had been some complaints against the police department with respect to other officers. Those officers, however, had been previously discharged from their employment with the department on the basis of those complaints. This does not demonstrate that Merrill knew of and disregarded any complaints concerning Fowler's misconduct. Once again, we come to the same conclusion on the failure to properly hire claim as articulated above. Accordingly, Andrews has created no genuine issue of material fact to support individual liability on the part of Merrill, and we affirm the grant of summary judgment in his favor.
B.
42
Andrews contends that the defendants conspired to deprive her of her constitutional rights, in violation of 42 U.S.C. § 1985(3), by ignoring and covering up complaints about Fowler's misconduct. To prove a § 1985(3) claim:
43
[A] complaint must allege that the defendants did (1) "conspire ..." (2) "for the purpose of depriving, either directly or indirectly, any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws." It must then assert that one or more of the conspirators (3) did, or caused to be done, "any act in furtherance of the object of [the] conspiracy," whereby another was (4a) "injured in his person or property" or (4b) "deprived of having and exercising any right or privilege of a citizen of the United States."
44
Griffin v. Breckenridge, 403 U.S. 88, 102-03, 91 S.Ct. 1790, 1798-99, 29 L.Ed.2d 338 (1971). The plaintiff must show that the conspiracy is fueled by some "class-based, invidiously discriminatory animus." Bray v. Alexandria Women's Health Clinic, 506 U.S. 263, 268, 113 S.Ct. 753, 758, 122 L.Ed.2d 34 (1993) (internal quotations omitted).
45
We conclude that the district court's grant of summary judgment on this cause of action was correct. There is no evidence of any agreement between Price, Merrill, and city council members to violate Andrews' constitutional rights. There is no evidence of a discriminatory animus toward women. There is evidence that one police officer engaged in misconduct that caused injury to Andrews and that the chief of police might have been aware of problems with this officer and failed to remedy the misconduct prior to Andrews' injury. There is no evidence that Price met with Merrill and city council members about Fowler's misconduct until August 1991, two months after Andrews' injury. Furthermore, at that time, Price requested that the city council discharge Fowler.
46
Additionally, to succeed on a civil rights conspiracy claim, the plaintiff must demonstrate discriminatory purpose in that the defendants selected the particular course of action " 'because of' not merely 'in spite of' its adverse effects upon an identifiable group." Bray, 506 U.S. at 272, 113 S.Ct. at 760. Andrews has submitted no evidence to demonstrate that the city, the mayor, or Price chose their course of action relating to Fowler's behavior because of its effect on an identifiable group--in this case, women. The district court did not err in granting summary judgment on Andrews' § 1985(3) claim.
C.
47
Finally, Andrews contends that the district court erred in denying her motion to take additional depositions of remaining city council members and other witnesses. See Fed.R.Civ.P. 30(a)(2)(A).
48
Under Rule 30(a)(2)(A), a party is entitled to up to ten depositions without leave of court, and to obtain discovery depositions beyond ten, leave of court is required. The record reveals that Andrews was permitted to take twelve depositions, two more than permitted without leave of court under Rule 30. Although some of these depositions were taken jointly for both this and a related case, see Bell v. Fowler, 99 F.3d 262 (8th Cir.1996), Andrews consented and participated in them (Andrews and Bell share the same counsel). We see no merit to her contention that she is entitled to more depositions, and we find no abuse of discretion in the district court's denial of her motion.
III.
49
Accordingly, we reverse the district court's grant of summary judgment to Price in his individual capacity and remand this claim for trial. In all other respects, we affirm the judgment of the district court.
1
Fowler had been diagnosed with an adjustment disorder and an occupational problem, which resulted in his general discharge. Approximately one month after he signed his employment application, however, the military corrected his record to reflect an honorable discharge on the basis that the military had incorrectly concluded that his diagnosis was a personality disorder. Fowler's military record, even under the general discharge, did not reveal any disciplinary action against Fowler or any violence or unlawful conduct on Fowler's part that would render him ineligible to be a police officer
2
The affidavit of former police officer Greg Hanson makes a bare allegation that the city council members and the mayor knew of the complaints against Fowler. (See Appellant's App. at 186.) This statement is made without giving any supporting factual basis, and therefore it does not create a genuine dispute of material fact | 01-03-2023 | 04-17-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/1588312/ | 944 So.2d 768 (2006)
Kathi BROOKS, Individually and on Behalf of her Minor Daughter, Nicole Bendily
v.
CITY OF JENNINGS, Jennings Police Chief Merrion S. Taylor, Lt. D. Daigle 231, PTN. C. Romero 538 and Det. K. Clement 423.
No. 06-680.
Court of Appeal of Louisiana, Third Circuit.
November 22, 2006.
*769 Joseph F. Gaar Jr., Jason M. Welborn, Attorneys at Law, Lafayette, LA, for Plaintiff/Appellant, Nicole Bendily.
*770 John F. Wilkes, Lisa E. Mayer, Joy C. Rabalais, Libby Heinen, Borne & Wilkes, L.L.P., Lafayette, LA, for Defendants/Appellees, City of Jennings, Chief Merrion S. Taylor, Lt. Damon Daigle, Det. Keith Clement, Officer Chad Romero.
Court composed of MICHAEL G. SULLIVAN, ELIZABETH A. PICKETT, and BILLY HOWARD EZELL, Judges.
PICKETT, Judge.
The plaintiff, Nicole Bendily[1], appeals the granting of a motion for summary judgment filed by the defendants, the City of Jennings; Chief Merrion S. Taylor, in his official capacity as Chief of Police for the City of Jennings; and Detective Keith Clement, Lieutenant (Lt.) Damon Daigle, and Officer Chad Romero, all in their official capacities as police officers for the City of Jennings (collectively, the defendants). Pursuant to the granting of the defendants' motion, the plaintiff's suit was dismissed with prejudice, at her costs. This appeal followed.
FACTS
The facts in this case are not in dispute. In the early morning hours of December 9, 2003, officers from the City of Jennings Police Department engaged in a high-speed chase of the plaintiff, Nicole Bendily. The chase ended when the plaintiff lost control of her vehicle. The vehicle left the roadway and rolled over. The plaintiff was ejected and sustained serious injuries.
Subsequently, suit was filed by the plaintiff seeking damages for injuries sustained. In due course, the defendants filed a motion for summary judgment which was granted by the trial court. The plaintiff, then, filed this appeal. We affirm the judgment of the trial court.
LAW AND DISCUSSION
The law applicable to the appellate review of summary judgments is well settled.
The summary judgment procedure is designed to secure the just, speedy, and inexpensive determination of every action, except those disallowed by law; the procedure is favored and must be construed to accomplish these ends. La. C.C.P. art. 966(A)(2); Yarbrough v. Federal Land Bank of Jackson, 31,815 (La.App.2d Cir. 03/31/99), 731 So.2d 482. The motion should be granted only if the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, show that there is no genuine issue of material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B); Leckie v. Auger Timber Co., 30,103 (La.App.2d Cir. 01/21/98), 707 So.2d 459. The burden of proof remains with the mover. However, if the party moving for summary judgment will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, then that party need not negate all essential elements of the adverse party's claim, action, or defense but may simply point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense; thereafter, if the adverse party fails to produce factual support sufficient to establish that it will be able to satisfy the evidentiary burden of proof at trial, there is no genuine issue of material fact. See, La. *771 C.C.P. art. 966(C)(2). When a motion is made and supported, as required by La. C.C.P. art. 966, an adverse party may not rest on the mere allegations or denials of his pleadings, but his response must set forth specific facts showing a genuine issue for trial. Otherwise, summary judgment, if appropriate, shall be rendered against him. La. C.C.P. art. 967.
Appellate courts review summary judgments de novo under the same criteria that govern a district court's consideration of whether summary judgment is appropriate. Kennedy v. Holder, 33,346 (La.App.2d Cir. 05/10/00), 760 So.2d 587.
Semien v. EADS Aeroframe Servs., LLC, 04-760, pp. 1-2 (La.App. 3 Cir. 2/2/05), 893 So.2d 215, 216-17 (quoting Sidwell v. Horseshoe Entm't Ltd. P'ship, 35,718, pp. 2-4 (La.App. 2 Cir. 2/27/02), 811 So.2d 229, 230-31).
The record reveals that at 6:30 a.m., Mrs. Kathi Brooks, the mother of plaintiff, Nicole Bendily, called the Jennings Police Department and reported that "my daughter took my car." When asked to clarify what she meant by the phrase "my daughter took my car," Mrs. Brooks stated "she stole my car." At the time Mrs. Brooks made the call she was in a vehicle following Nicole and called to request police intervention to stop Nicole. Mrs. Brooks explained that Nicole was due to leave with the family that morning to begin drug "rehab," but that she didn't want to go, so she took the car and drove off. Mrs. Brooks and another party followed in a second vehicle. Nicole's father got into a third vehicle to begin a search for Nicole. A Jennings Police Department (the P.D.) unit, driven by Patrolman (Ptn.) Chad Romero, was dispatched to the last place Nicole had been seen and started a search for Nicole. Lt. Damon Daigle, who took the initial call from Mrs. Brooks, left the station to join the hunt.
At 6:50 a.m., Mrs. Brooks, who was in a Grand AM, again called the P.D. and reported that she had spotted Nicole heading south on South Main Street. Mrs. Brooks followed her as Nicole turned east on Park Street and then north on South Cutting Street. At that time, Lt. Daigle was proceeding south on South Cutting Street. He spotted Nicole and fell in behind her, activating his emergency lights and siren. Nicole accelerated, turned east on U.S. Highway 90 and then north on South Louise Street. Lt. Daigle, who was in pursuit, estimated Nicole's speed to be in excess of 60 m.p.h. By this time, Ptn. Romero had fallen in behind Lt. Daigle. When asked about Nicole's ability to handle her vehicle at high speed, Lt. Daigle stated that "[s]he was fairly good." When pressed on the issue he said: "She actually showed remarkable handling of a vehicle that heavy [Nicole was driving a Toyota Avalon]." The pursuit continued north on South Louise, then west on East Nezpique, north again on Ruland, then west on East Academy, south again on North Morton Street, and west on Granger, back toward U.S. 90. She then turn north on Market to East Main, then west on East Academy toward La. Hwy. 26 (South Lake Arthur Road). She crossed Hwy. 26, then turned south on North Doyle Street. At that point, because Nicole's speed had increased to near 100 m.p.h. and because she was running "STOP" signs, Lt. Daigle terminated pursuit and they lost sight of Nicole's vehicle. This was at approximately 6:56 a.m.
Mrs. Brooks called the P.D. again at 6:57 am to report that her husband was in pursuit of Nicole, heading south on the Lake Arthur Highway (La. Hwy. 26) at over 100 m.p.h. About two minutes later, Patrolman Romero reported that he had *772 Nicole's vehicle in sight headed north on La. Hwy. 26, just south of La. Hwy. 1126, and that he was re-initiating pursuit. Nicole turned east on La. Hwy. 1126. As Nicole approached Castex Landing Road, she lost control of the vehicle and was ejected as the vehicle rolled over.
Several times on the voice log, one can hear Lt. Daigle warning his officers to be careful and to "back off" if the situation became too dangerous. One can also hear a comment to the effect that Nicole was having trouble handling her vehicle. At several places one can hear pursuing officers reporting they did "back off" when they felt the situation warranted more caution.
The linchpin of this case can be found in the provisions of La.R.S. 32:24:
A. The driver of an authorized emergency vehicle, when responding to an emergency call, or when in the pursuit of an actual or suspected violator of the law, or when responding to, but not upon returning from, a fire alarm, may exercise the privileges set forth in this Section, but subject to the conditions herein stated.
B. The driver of an authorized emergency vehicle may:
(1) Park or stand, irrespective of the provisions of this Chapter;
(2) Proceed past a red or stop signal or stop sign, but only after slowing down or stopping as may be necessary for safe operation;
(3) Exceed the maximum speed limits so long as he does not endanger life or property;
(4) Disregard regulations governing the direction of movement or turning in specified directions.
C. The exceptions herein granted to an authorized emergency vehicle shall apply only when such vehicle is making use of audible or visual signals sufficient to warn motorists of their approach, except that a police vehicle need not be equipped with or display a red light visible from in front of the vehicle.
D. The foregoing provisions shall not relieve the driver of an authorized vehicle from the duty to drive with due regard for the safety of all persons, nor shall such provisions protect the driver from the consequences of his reckless disregard for the safety of others.
The defendants rely on Sections A, B, and C of the statute to exonerate them from liability, while the plaintiff claims the defendants are liable under Section D of the statute. The plaintiff also argues the defendants should be held liable for their failure to strictly adhere to Jennings Police Department policy governing pursuit.
In Lenard v. Dilley, 01-1522, pp. 6-7 (La.1/15/02), 805 So.2d 175, 180, the supreme court concluded that La.R.S. 32:24 contains two alternate standards of care for use in deciding the fault or lack thereof of drivers of emergency vehicles:
La.Rev.Stat. 32:24(D) sets out two standards of care for an emergency vehicle driver depending on the circumstances of the case. If, and only if, an emergency vehicle driver's actions fit into subsections A, B and C of La.Rev. Stat. 32:24, will an emergency vehicle driver be held liable only for actions which constitute reckless disregard for the safety of others. On the other hand, if the emergency vehicle driver's conduct does not fit subsections A, B and C of La.Rev.Stat. 32:24, such driver's actions will be gauged by a standard of "due care."
"Due care" is synonymous with ordinary negligence. "Reckless disregard," however, connotes conduct more severe than negligent behavior. "Reckless disregard" is, in effect, "gross negligence." *773 Gross negligence has been defined by this court as "the want of even slight care and diligence. It is the want of that diligence which even careless men are accustomed to exercise." State v. Vinzant, 200 La. 301, 7 So.2d 917 (1942). "Reckless disregard" or "gross negligence" is the standard to be applied if the emergency vehicle driver's actions fit La.Rev.Stat. 32:24(A) through La. Rev.Stat. 32:24(C). Otherwise, the standard is ordinary negligence.
Thus, if the provisions of subsections A, B and C of La.Rev.Stat. 32:24 apply to the accident or incident in question, then the driver will be held liable only for his conduct which constitutes reckless disregard for the safety of others.
In the case sub judice, the actions of the Jennings Police Officers clearly fell under subsections A, B, and C of La.R.S. 32:24. One can clearly hear their sirens on the CD of the radio log and the testimony in the officers' depositions confirms that the pursuing units were using their lights and sirens. Thus the actions of the officers in this case must be judged under the "reckless disregard" or "gross negligence" standard.
The plaintiff argues that, even under "reckless disregard" or "gross negligence" standard, the officers should be found liable for their failure to strictly adhere to department policy governing pursuit. The courts disagree. In determining whether an officer breached his duty to a particular plaintiff, the issue to be decided is not whether the office failed to comply with department policy, but rather was the course of action he pursued reasonable under the totality of the circumstances. Courville v. City of Lake Charles, 98-73 (La.App. 3 Cir. 10/28/98), 720 So.2d 789; Jones v. Congemi, 01-1345, 02-148, 02-149 (La.App. 5 Cir. 5/13/03), 848 So.2d 41, writ denied, 03-1647 (La.10/10/03), 855 So.2d 354.
Police officers have the duty of maintaining peace and order, preventing and detecting crime, and enforcing laws. Zeagler v. Town of Jena, 556 So.2d 978 (La.App. 3 Cir.), writ denied, 560 So.2d 14 (La.1990). The duty is owed to the public in general but may be transformed into a duty to an individual where a personal or individual relationship arises between the officer and an individual through closeness in proximity or time. Id. Generally, a police officer, in carrying out his authority to enforce laws, has the duty to act reasonably to protect life and limb, to refrain from causing injury or harm, and to exercise respect and concern for the well-being of those whom he is employed to protect. Keller v. City of Plaquemine, 96-1933 (La.App. 1 Cir. 9/23/97) 700 So.2d 1285, writ denied, 97-2635 (La.1/16/98), 706 So.2d 977. The supreme court has addressed the duty owed by an officer when approaching a subject prior to disarming him or effectuating an arrest. See Stroik [v. Ponseti, 96-2897 (La.9/9/97)], 699 So.2d 1072; Mathieu v. Imperial Toy Corp., 94-0952 (La.11/30/94); 646 So.2d 318; Kyle v. City of New Orleans, 353 So.2d 969 (La.1977). In such cases, the duty is one of reasonableness under the totality of the circumstances. See id. We note that Stroik, Mathieu, and Kyle involved the issue of excessiveness of force, and we find the pursuit issue sufficiently analogous to allow application of the standard employed in those cases. In White v. City of Baker, 95-2009 (La. App. 1 Cir. 5/17/96), 676 So.2d 121, writ denied, 96-1547 (La.9/27/96); 679 So.2d 1351, the first circuit held that the same standard was applicable in a situation in which an officer was attempting *774 to apprehend an individual who disobeyed a police order and was fleeing from the officer, which ended with the fleeing vehicle overturning and killing a guest passenger..... In any event, the same standard of reasonableness should apply, albeit with the application of different factors [in different situations]. Thus, we will analyze the duty issue in terms of reasonableness under the totality of the circumstances. We note that the officer's actions need not be the "best" method of approach; rather, the standard of care requires choosing only a course of action that is reasonable under the circumstances. See Mathieu, 646 So.2d 318.
Courville, 720 So.2d at 797-98.
In the case before us, one finds an impaired teenager driving recklessly, at excessive speeds through the City of Jennings. She is not only being pursued by the police, but also by both her mother and father, in separate vehicles. It was simply a matter of time until someone got hurt. Fortunately, no one was killed and no innocent bystander sustained injury. Considering the totality of the circumstances, we find the police involved in the pursuit used great restraint and that their conduct was neither reckless nor grossly negligent. If anything, their actions reflected due care for the safety of the citizens of Jennings and the parties involved in the pursuit. The officers discontinued the chase at one point and "backed-off" at other points when the situation became too dangerous. The last place they backed off was at the junction of La. Highways 102 and 1126, just seconds before the crash.
When Ms. Bendily left the Jennings city limits headed south toward Lake Arthur on La. Highway 26, no police were in pursuit. It was her father who was chasing her at speeds estimated to be in excess of 100 m.p.h. The Jennings police department did not re-join the pursuit until 6:59 a.m. when she was spotted at the junction of La. Highways 26 and 1126. The crash occurred approximately two minutes later on La. Highway 1126 at Castex Landing Road
In sum, we conclude that although the officers may not have followed the best course of action, that, under the circumstances, the course of action followed was reasonable. Furthermore, we find the plaintiff has failed to set forth any specific facts showing a genuine issue of material fact for trial.
Accordingly, for the reasons stated, the judgment of the trial court is affirmed. All costs of this appeal are assessed against the appellant.
AFFIRMED.
NOTES
[1] The petition was originally filed by the "plaintiff, Kathi Brooks, individually, and on behalf of her minor daughter, Nicole Bendily, a person of the full age of majority" seeking damages (emphasis ours). In January 2005, the plaintiffs noticed their mistake and Nicole Bendily was substituted as the sole plaintiff. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588321/ | 944 So.2d 668 (2006)
J. Robert WOOLEY, as Acting Commissioner of Insurance for the State of Louisiana
v.
AMCARE HEALTH PLANS OF LOUISIANA, INC.
No. 2005 CW 2025.
Court of Appeal of Louisiana, First Circuit.
October 25, 2006.
*670 Joseph E. Cullens, Jr., Baton Rouge, Guy M. Hohmann, Austin, TX, Kimberly S. Morgan, Edward J. Walters, Jr., Baton Rouge, Sue Buser, Gonzales, Jonathan C. Augustine, Baton Rouge, Counsel for PlaintiffAppellee J. Robert Wooley, as Acting Commissioner of Insurance and Liquidator of AmCare Health Plans of Louisiana, Inc.
James C. Percy, David M. Kerth, Baton Rouge, Robert B. Bieck, Jr., New Orleans, Counsel for DefendantAppellant HealthNet, Inc.
Joseph J. McKernan, Baton Rouge, Counsel for PlaintiffAppellee Jean Johnson as Texas Special Deputy Receiver.
David M. Latham, Keary L. Everitt, New Orleans, Counsel for PlaintiffAppellee Louisiana Department of Insurance.
Gary P. Koederitz, Baton Rouge, Counsel for DefendantAppellee BestCare, Inc.
Wendell Clark, Baton Rouge, Counsel for DefendantAppellee Thomas S. Lucksinger, Michael D. Nadler and Stephen J. Nazarenus.
Claude F. Reynaud, Jr., Baton Rouge, Counsel for DefendantAppellee Proskauer Rose, L.L.P. and Stuart L. Rosow.
Harry J. Philips, Jr., Baton Rouge, Counsel for DefendantAppellee William Galtney, Jr. and Michael K. Jhin.
Mary Olive Pierson, V. Thomas Clark, Jr., Baton Rouge, Counsel for DefendantAppellee PriceWaterhouseCoopers, L.L.C.
Robert J. Burns, Jr., Baton Rouge, David H. Topol, Washington, D.C., Counsel for DefendantAppellee Greenwich Insurance Company.
George B. Hall, Jr., New Orleans, Merril Hirsh, Washington, D.C., Kelsey Kornick Funes, Baton Rouge, Counsel for DefendantAppellee Executive Risk Management and Executive Risk Specialty Ins. Co.
David L. Guerry, Baton Rouge, Counsel for DefendantAppellee Scott Westbrook.
William C. Kaufman, III, Baton Rouge, Counsel for DefendantAppellee M. Lee Pearce.
Dominique J. Sam, Michael Charles Guy, Baton Rouge, Counsel for Amicus Curiae Charles C. Foti, Jr., Atty. Gen., On Behalf of the Commissioner of Insurance-Liquidator of AmCare Health Plans of Louisiana, Inc.
Before: CIACCIO, LANIER and CLAIBORNE, JJ.[1]
*671 LANIER, J.
Defendant, Health Net, Inc., seeks appellate review of the overruling of its declinatory exception raising the objection of improper venue. For the following reasons, we affirm.
GENERAL PROCEDURAL FACTS
AmCare Health Plans of Texas, Inc. (AmCare-TX), was a health maintenance organization (HMO) licensed by and operating in Texas. Foundation Health Corp. and/or Foundation Health System, now known as Health Net, Inc. (Health Net), owned AmCare-TX, along with similar licensed HMOs in Louisiana, AmCare Health Plans of Louisiana, Inc. (AmCare-LA), and Oklahoma, AmCare Health Plans of Oklahoma, Inc. (AmCare-OK).[2] Health Net considered the three HMOs a financial liability and sold the HMOs to Thomas S. Lucksinger and others (collectively Lucksinger). Health Net retained a minority ownership interest in the HMOs. The HMOs eventually were ruled insolvent by the three respective state regulators.
Multiple lawsuits were filed in Louisiana and Texas by the receivers against various defendants, including Lucksinger, Price-WaterhouseCoopers (PWC) and Health Net. The lawsuits alleged mismanagement of the HMOs and accounting negligence and sought enforcement of guarantees made by Health Net regarding the HMOs' solvency. The allegations were amended to include charges of contract fraud and tort gross negligence by Health Net, Lucksinger, PWC and others. The trial court subsequently consolidated the three suits filed in Louisiana by J. Robert Wooley, Louisiana Commissioner of Insurance as Liquidator for AmCare-LA. The Texas receiver then intervened in the Louisiana proceedings against Health Net. The Texas receiver's allegations against Health Net included claims of fraud and conspiracy to defraud in connection with the sale, operation and management of the HMOs. Health Net responded by filing a declinatory exception raising the objection of improper venue asserting that under Texas law the exclusive venue for the Texas receiver's action was in Texas and, thus, venue was improper in Louisiana. The trial court overruled Health Net's exception and Health Net took this appeal.
APPEAL OR SUPERVISORY WRIT:
THE RETROACTIVE EFFECT OF ACT 205 OF 2005
Procedural Facts
On May 24, 2005, the district court judge signed a judgment that, in part, overruled Health Net's declinatory exception raising the objection of improper venue. Health Net filed a motion for a devolutive appeal. The district court judge refused to grant an appeal and ordered Health Net to seek a supervisory writ. Health Net reurged its request for an appeal, and on June 1, 2005, the district court judge signed an order for a devolutive appeal. This appeal was lodged with this Court on September 29, 2005. The order of appeal was correctly granted.
During this time period La. C.C.P. art. 2083 A provided, in pertinent part, that "[a]n appeal may be taken . . . from an interlocutory judgment which may cause irreparable injury." Contemporary jurisprudence held that, although the overruling of a declinatory exception raising the objection of improper venue was an interlocutory judgment, if it may cause irreparable *672 injury it was an appealable judgment. La. C.C.P. art. 1841; Price v. Roy O. Martin Lumber Co., XXXX-XXXX, p. 6, n. 2 (La.App. 1 Cir. 4/27/05), 915 So.2d 816, 821, n. 2, writ denied, XXXX-XXXX (La.1/27/06), 922 So.2d 543; Revision Comments 2005(a) and (b) for Act 205.
Act 205 of 2005
Article 2083 was amended by 2005 La. Act 205 to provide that "[a]n interlocutory judgment is appealable only when expressly provided by law." No law has been found that expressly provides for an appeal in this case at the present time.
Effective Date of Act 205
Section 2 of Act 205 provides that "[t]his Act shall become effective on January 1, 2006." (Emphasis added.)
The effective date of all laws is provided for in La. CONST. art. III, § 19 as follows:
All laws enacted during a regular session of the legislature shall take effect on August fifteenth of the calendar year in which the regular session is held and all laws enacted during an extraordinary session of the legislature shall take effect on the sixtieth day of the final adjournment of the extraordinary session in which they were enacted. All laws shall be published prior thereto in the official journal of the state as provided by law. However, any bill may specify an earlier or later effective date. (Emphasis added.)
In Section 2 of Act 205 the legislature exercised its constitutional power to fix a "later effective date". The fixing of an effective date determines when the prospective effect of a law commences. As will be hereinafter shown, this does not equate to a "legislative expression" of retroactivity. The words prospective and retroactive have antithetical meanings. Although all laws have an effective date (are prospective), all laws are not retroactive.
Retroactive Effect of Act 205
The legislature is free, within constitutional confines, to give its enactments retroactive effect. A court must defer to the legislature's intent when determining whether a statute should be applied retroactively. Retroactive application of new legislation is constitutionally permissible only if it does not result in impairment of the obligations of contracts or in divestiture of vested rights. U.S. CONST. amend. XIV, § 1 (due process and equal protection); U.S. CONST. art. I, § 10(1) (ex post facto law or law impairing the obligations of a contract); La. CONST. art. I, § 2 (due process); La. CONST. art. 23 (ex post facto law or law impairing the obligations of a contract); Morial v. Smith & Wesson Corp., XXXX-XXXX, pp. 11-13 (La.4/3/01), 785 So.2d 1, 9-11, cert. denied, 534 U.S. 951, 122 S.Ct. 346, 151 L.Ed.2d 262 (2001).
In determining whether a law may be applied retroactively, courts are guided by La. C.C. art. 6 which provides as follows:
In the absence of contrary legislative expression, substantive laws apply prospectively only. Procedural and interpretative laws apply both prospectively and retroactively, unless there is a legislative expression to the contrary.
See also La. R.S. 1:2.
Article 6 requires a two-step inquiry: (1) did the legislature express its intent regarding retrospective or prospective application, and (2) if not, is the law substantive, procedural or interpretive. Substantive laws establish new rules, rights and duties or change existing ones. Procedural laws prescribe a method (remedy) for enforcing a substantive right and relate to the form of the proceeding or the operation of the laws. Interpretive laws merely establish the meaning the interpreted law *673 had from the time of its enactment. Segura v. Frank, 93-1271, pp. 9-12 (La.1/14/94), 630 So.2d 714, 720-23, cert. denied sub nom., Allstate Ins. Co. v. Louisiana Ins. Guar. Ass'n, 511 U.S. 1142, 114 S.Ct. 2165, 128 L.Ed.2d 887. See also Manuel v. Louisiana Sheriff's Risk Mgmt. Fund, 95-0406, pp. 8-9 (La.11/27/95), 664 So.2d 81, 85-86.
Finally, an appellate court is bound to adjudge a case before it in accordance with the law existing at the time of its decision. Where the law has changed during the pendency of a suit and retroactive application of the new law is permissible, the new law applies on appeal even though it requires reversal of a trial court judgment which was correct under the law in effect at the time it was rendered. Segura, 630 So.2d at 725. See also Cheron v. LCS Corrections Serv. Inc., XXXX-XXXX, p. 8 (La.1/19/05), 891 So.2d 1250, 1257-58.
The first inquiry to be made pursuant to the Segura methodology for determining retroactivity is did the legislature express its intent regarding retrospective application? A review of Act 205 shows that it does not contain a "legislative expression" that it applies retroactively. As previously indicated, the legislative expression of an effective date does not legislate retroactivity. Accordingly, we must proceed to the second Segura inquiry to determine whether Act 205 is substantive, procedural, or interpretive.
Is the Act 205 Amendment Substantive, Procedural or Interpretive?
Act 205 is not interpretive because it is clear and unambiguous in stating that "[a]n interlocutory judgment is appealable only when expressly provided by law." Act 205 amends the law; it does not interpret it. Thus, the final question is whether Act 205 is substantive or procedural.
Pursuant to Segura, a substantive law is one that establishes new rules, rights and duties or changes existing ones, and a procedural law prescribes a method for enforcing a substantive right and relates to the form of the proceeding or the operation of the law. Simply stated, did Act 205 effect a change in substance (right, obligation, or duty) or a change in procedure (remedy)?
Act 205 amended La. C.C.P. art.2083, which is found in the Code of Civil Procedure. Act 205 changed the appealability of an interlocutory judgment. An interlocutory judgment is "[a] judgment that does not determine the merits but only preliminary matters in the course of the action." La. C.C.P. art. 1841. The merits of an action are the substantive rights and obligations of the parties which are decided only by a final judgment. La. C.C.P. art. 1841. Preliminary matters in the course of an action are procedural matters. Thus, it has been said that substance includes all rules that determine the legal relations that courts must adjudicate, whereas, procedure relates to the process by which the facts are made known to the courts. H. Goodrich, Handbook of the Conflict of Laws, § 80, p. 143, n. 3 (4th ed.1964). A venue law is procedural so long as it does not make a change in the substantive law. Lejano v. K.S. Bandak, 97-0388 (La.12/12/97), 705 So.2d 158, 165-66, cert. denied, 525 U.S. 815, 119 S.Ct. 52, 142 L.Ed.2d 40 (1998). The amendment to Article 2083 effected a procedural change in the law.
Finally, the practical effect of Act 205 shows why it is a procedural law and not a subtantive law. La. CONST. art. V, § 5 (Louisiana Supreme Court) and La. CONST. art. V, § 10 (Courts of Appeal) provide for the appellate review of civil cases. This appellate review may be accomplished by an appeal or a supervisory *674 writ. Prior to Act 205, interlocutory judgments that may cause irreparable injury were reviewable by either procedure. These judgments are still reviewable by either procedure. Even though an interlocutory judgment is not immediately appealable now, it can still be reviewed when an unrestricted appeal is taken from a final judgment; in such an appeal, the appellant is entitled to seek review of all adverse interlocutory judgments prejudicial to him, in addition to the review of the final judgment. Judson v. Davis, XXXX-XXXX, p. 8 (La.App. 1 Cir. 6/29/05), 916 So.2d 1106, 1112, writ denied, XXXX-XXXX (La.2/10/06), 924 So.2d 167; ANR Pipeline Co. v. Louisiana Tax Comm'n, 2001-2594, p. 10, n. 5 (La.App. 1 Cir. 3/20/02), 815 So.2d 178, 186, affirmed and remanded, XXXX-XXXX (La.7/2/03), 851 So.2d 1145. Thus, the effect of Act 205 is to change the point in time the interlocutory judgment can be reviewed on appeal; it does not repeal the review by appeal. Act 205 does not affect the validity of the defendant's claim that the venue is improper.
Finally, it is well settled that there is no vested right in any given mode of procedure. Sawicki v. K/S Stavanger Prince, XXXX-XXXX, pp. 7-8 (La.12/7/01), 802 So.2d 598, 604-05, and the cases cited therein.
Act 205 is a procedural law and, pursuant to La. C.C. art. 6, applies retroactively.
Although this appeal was properly granted before the effective date of Act 205, it is no longer valid.[3] On its effective date Act 205 became prospective and retroactive. As previously indicated, an appellate court is bound to adjudge a case before it in accordance with the law existing at the time of the decision; the retroactive new law applies even though it requires reversal of the trial court order that was correct at the time it was rendered. This appeal is dismissed without prejudice.
However, because the merits of this issue deserve a swift and certain resolution, we will exercise our supervisory jurisdiction and grant a writ of certiorari to review the venue issue. Stelluto v. Stelluto, XXXX-XXXX, p. 7 (La.6/29/05), 914 So.2d 34, 39; State ex rel., Dep't of Social Services v. Howard, 2003-2865, p. 2, n. 1 (La.App. 1 Cir. 12/30/04), 898 So.2d 443, 444, n. 1.[4]
VENUE
Health Net asserts that since delinquency proceedings against AmCare-TX were instituted by the Texas receiver and are pending in Travis County, Texas, Travis County is the exclusive venue for all actions brought by the receiver for AmCare-TX, and Louisiana's Nineteenth Judicial District Court for the Parish of East Baton Rouge is not a proper venue. Further, Health Net asserts that where statutory law provides the only proper venue, that venue is non-waivable and is jurisdictional. Because the Texas statute vests exclusive venue in a particular court, Health Net asserts only the statutorily authorized court has subject matter jurisdiction. Moreover, Health Net asserts that the Texas statutory jurisdictional venue provisions do not provide for venue in a Louisiana court, and therefore, the trial court in this case is without subject matter jurisdiction.
*675 What is Venue?
Venue means the parish where an action or proceeding may properly be brought and tried under the rules regulating the subject. La. C.C.P. art. 41. The three consolidated actions herein were brought and tried in the Nineteenth Judicial District Court in and for the Parish of East Baton Rouge. Venue designates a place or places where an action shall be filed. Whether venue is proper is a question of law for which a de novo review is conducted by an appellate court. Novelaire Tech., L.L.C. v. Harrison, 2006-94, p. 5 (La.App. 5 Cir. 7/25/06), 939 So.2d 437, 440, and the cases cited therein.
Venue for the Main Demands
Part XVI of the Louisiana Insurance Code is entitled "REHABILITATION, LIQUIDATION, CONSERVATION, DISSOLUTION, AND ADMINISTRATIVE SUPERVISION" and is found in La. R.S. 22:732 et seq. La. R.S. 22:732.3 A entitled "Venue" provides as follows:
An action under this Part brought by the commissioner of insurance, in that capacity, or as conservator, rehabilitator, or liquidator may be brought in the Nineteenth Judicial District Court for the parish of East Baton Rouge or any court where venue is proper under any other provision of law.
The venue is proper for the three main demands filed by the Louisiana Insurance Commissioner in the Nineteenth Judicial District Court for the Parish of East Baton Rouge.
The Objection of Improper Venue
The objection of improper venue is a defense that may be raised through the declinatory exception. La. C.C.P. art. 925 A(4). The function of the declinatory exception is to decline the jurisdiction of a court. La. C.C.P. art. 923. Jurisdiction is the legal power and authority of a court to hear and determine an action or proceeding involving the legal relations of the parties and to grant the relief to which they are entitled. La. C.C.P. art. 1; see generally F. Maraist and H. Lemmon, 1 La. Civil Law Treatise, Civil Procedure, §§ 3.1-3.8 and 6.5, pp. 30-49 and 110-11 (1999).
It has been held that venue and jurisdiction are separate and distinct legal concepts and that they are closely related but are not synonymous. Garcia v. Poseidon Shipping Co., Ltd., 99-0322, p. 5 (La.App. 4 Cir. 10/6/99), 746 So.2d 633, 636, writ denied, 99-3182 (La.1/28/00), 753 So.2d 203; 77 Am.Jur.2d Venue, § 1, p. 608 (1997). See also Ponthieux v. Lindsay, 216 So.2d 407, 413-14 (La.App. 3 Cir.1968) (on second rehearing), and the authorities cited therein, affirmed, 254 La. 647, 226 So.2d 482 (1969). Further, jurisdiction has been described as "a term with multiple meanings." Jurado v. Brashear, XXXX-XXXX, p. 3 (La.3/19/01), 782 So.2d 575, 577.
Jurisdiction
There are many types of jurisdiction. It does not appear that venue is closely related to jurisdiction over (1) the person, (2) property or (3) status. La. C.C.P. arts. 6, 8 and 10. However, it does appear that venue is closely related to original and territorial jurisdiction.
Original jurisdiction is jurisdiction in the first instance and specifies the adjudicative tribunal in which the initial adjudication is made.[5]Wooley v. State Farm *676 Fire & Cas. Ins. Co., XXXX-XXXX, p. 24 (La.1/19/05), 893 So.2d 746, 764. Louisiana Constitution article V, § 16(A)(1) provides that, "[e]xcept as otherwise authorized by this constitution or except as heretofore or hereafter provided by law for administrative agency determinations in worker's compensation matters, a district court shall have original jurisdiction of all civil and criminal matters." (Emphasis added.) The Nineteenth Judicial District Court has original jurisdiction herein because these cases are civil actions and there is no Louisiana constitutional provision stating otherwise.
All district courts in Louisiana have territorial jurisdiction over at least one parish. See La. CONST. art. V, § 14. For venue to be proper, the court in which an action is brought and tried must have territorial jurisdiction over the parish (or other area) designated as a proper venue. Because venue designates a place (parish or other physical area) wherein an action must be filed, it appears that it is most closely related to territorial jurisdiction. The territorial jurisdiction of the Nineteenth Judicial District Court is the Parish of East Baton Rouge. La. R.S. 13:477(19).[6]
Subject matter jurisdiction is the legal power and authority of a court to hear and determine a particular class of actions or proceedings, based upon the object of the demand, the amount in dispute, or the value of the right asserted. La. C.C.P. art. 2. As previously indicated, pursuant to La. CONST. art. V. § 16(A)(1) district courts "have original jurisdiction of all civil . . . matters." (Emphasis added.) Civil matters generally are considered to be those subject matters that have been traditionally adjudicated by district courts. Madison v. Ward, 2000-2842, p. 9 (La.App. 1 Cir. 7/3/02), 825 So.2d 1245, 1253. In BLACK'S LAW DICTIONARY 767 (7th ed.1979) subject matter jurisdiction is defined as follows:
Power of a particular court to hear the type of case that is then before it . . .; Term refers to jurisdiction of court over class of cases to which particular case belongs . . .; jurisdiction over nature of the cause of action or relief sought . . .; or the amount for which a court of limited jurisdiction is authorized to enter judgment. (Emphasis added.)
See also 21 C.J.S. Courts § 10, p. 18 (1990).
Civil matters are a class of cases. The intervention of AmCare-TX asserts causes of action in contract and tort. These are subject matters that traditionally are adjudicated by district courts in Louisiana and, thus, are civil matters. These matters are substantive matters pertaining to rights, duties and obligations. Venue is a procedural matter unrelated to substantive causes of action. Subject matter jurisdiction in one state does not preclude such jurisdiction from being valid in another state or in a federal court. A & L Energy, Inc. v. Pegasus Group, XXXX-XXXX, p. 12 (La.6/29/01), 791 So.2d 1266, 1275, cert. denied, 534 U.S. 1022, 122 S.Ct. 550, 151 L.Ed.2d 426 (2001); ACG Mediaworks, L.L.C. v. Ford, XXXX-XXXX, p. 5 (La.App. 5 Cir. 3/30/04), 870 So.2d 1097, 1101; de Nunez v. Bartels, 97-1384, pp. 8-10 (La.App. 1 Cir. 9/9/98), 727 So.2d 463, 467-68; Everest Reinsurance Co. v. Howard, 950 S.W.2d 800, 803 (Tex.App.Austin 1997), review denied (1/16/98).
Pursuant to the Louisiana Constitution, the Nineteenth Judicial District Court has subject matter jurisdiction over *677 this action. The appellant's assertion to the contrary is without merit.
Louisiana Venue Law for the AmCare-TX Intervention
An intervention is an incidental action that may be filed in an ordinary proceeding and is provided for in Louisiana Code of Civil Procedure article 1091 et seq. Article 1091 provides as follows:
A third person having an interest therein may intervene in a pending action to enforce a right related to or connected with the object of the pending action against one or more of the parties thereto by:
(1) Joining with plaintiff in demanding the same or similar relief against the defendant;
(2) Uniting with defendant in resisting the plaintiff's demand; or
(3) Opposing both plaintiff and defendant (emphasis added).
Louisiana Code of Civil Procedure article 1094 provides, "[a]n intervener cannot object to the form of the action, to the venue, or to any defects and informalities personal to the original parties." (Emphasis added.) Louisiana Code of Civil Procedure article 1034 provides as follows:
A defendant in an incidental action may plead any of the exceptions available to a defendant in a principal action, and may raise any of the objections enumerated in Articles 925 through 927, except that an objection of improper venue may not be urged if the principal action has been instituted in the proper venue. Exceptions pleaded by the defendant in an incidental action shall be subject to all of the provisions of Articles 924 through 934.
A party to an incidental action may plead any of the written motions available to a party to a principal action, subject to the provisions of Articles 961 through 969 (emphasis added).
Official Revision Comment (b) 1960 for Article 1034 provides as follows:
The rule enunciated in the first sentence of this article that the defendant in an incidental action may urge all procedural objections available to a defendant in the principal action, except that improper venue may not be urged if the principal action is instituted in the proper venue, is simply declaratory of civilian theories of incidental actions. If the principal action is filed in the proper venue, then that court has ancillary jurisdiction to entertain jurisdiction over the defendant in the incidental action, even though the venue might have been improper had the incidental action been instituted as a separate suit. This is axiomatic, otherwise the venue of all incidental actions would be improper if instituted against a nonresident defendant. On this point, see Art. 384 Code of Practice of 1870 (emphasis added).
See also F. Maraist and H. Lemmon, supra, § 7.3, pp. 168-71.[7]
The Texas Venue Law
At the time these actions were instituted, Texas' provisions governing the insurance *678 industry, found at V.A.T.S. Insurance Code article 1.10 et seq., provided as follows:
New Lawsuits. The court of competent jurisdiction of the county in which delinquency proceedings are pending under this Article shall have exclusive venue to hear and determine all actions or proceedings instituted after the commencement of delinquency proceedings by or against the insurer or receiver.
V.A.T.S. Insurance Code article 21.28, § 4(h).[8]
A delinquency proceeding was defined as "any proceeding commenced in any court of this State against an insurer for the purpose of liquidating, rehabilitating, reorganizing, or conserving such insurer." V.A.T.S. Ins.Code art. 21.28, § 1(b). V.A.T.S. Insurance Code article 21.28, § 4(i) states: "Venue. Exclusive venue of delinquency proceedings shall be in Travis County, Texas."
CONFLICT OF LAWS: WHICH VENUE STATUTE APPLIES?
When an action is filed in a state asserting that a cause of action accrued in another state, the applicable state law is determined by whether the issue involved is a matter of substance (right) or a matter of procedure (remedy). The substantive rights of the parties are determined by the law of the state where the cause of action arose; matters of procedure are determined by the law of the forum, i.e., the place where the action is filed. The court of the forum, subject to the limitations of the federal constitution, determines whether the question involved is one of substance or procedure. Sun Oil Co. v. Wortman, 486 U.S. 717, 722, 108 S.Ct. 2117, 2122, 100 L.Ed.2d 743 (1988); Williams v. Petroleum Helicopters, Inc., 234 So.2d 522, 523 (La.App. 3 Cir.1970), application denied, 256 La. 371, 236 So.2d 501 (La.1970); Penny v. Powell, 162 Tex. 497, 499, 347 S.W.2d 601, 602-03 (Tex.1961); Hill v. Perel, 923 S.W.2d 636, 639 (Tex.App. Houston 1995); H. Goodrich, supra, §§ 80-81, pp. 142-44; 16 Am.Jur.2d Conflict of Laws § 127, p. 142 (1998). Louisiana law on the conflict of laws applies. La. C.C. art. 3517.
Substantive laws establish or change substantive rules, rights and duties; procedural laws prescribe a method for enforcing a substantive right and relate to the form of the proceeding or the operation of the laws. Segura, 630 So.2d at 723; Madison, 825 So.2d at 1254. See also H. Goodrich, supra, § 80, p. 143, n. 3.
As previously indicated, venue "means the parish where an action or proceeding may properly be brought and tried under the rules regulating the subject." La. C.C.P. art. 41. The place where an action is filed and tried does not change the substantive rights of the parties that are litigated. Venue prescribes part of the method for enforcing the substantive rights of the parties. Venue is a procedural issue and the law of Louisiana prevails herein over the law of Texas on the issue of venue. American Dredging Co. v. Miller, 510 U.S. 443, 443 and 453-57, 114 S.Ct. 981, 983 and 988-90, 127 L.Ed.2d 285 (1994); Sawicki, 802 So.2d at 600 and 603-04; Lejano, 705 So.2d at 165 and 166; Bristol-Myers Squibb Co. v. Goldston, 957 S.W.2d 671, 673 (Tex.App.Fort Worth *679 1997), review denied (5/8/98); Brooks v. Texas Employers Ins. Ass'n, 358 S.W.2d 412, 415 (Tex.App.Houston 1962); Kerr Constr., Inc. v. Peters Contracting, Inc., 767 So.2d 610, 612 (Fla.App. 5 Dist.2000); 15A C.J.S. Conflict of Laws §§ 96-97, pp. 292-96 (2002).
The venue herein is proper. We find no error in the trial court's ruling.
DECREE
For the foregoing reasons, the appeal herein is dismissed without prejudice. The supervisory writ is denied on the merits and the judgment of the trial court is affirmed.
APPEAL DISMISSED; WRIT DENIED; JUDGMENT AFFIRMED.
NOTES
[1] The Hon. Philip C. Ciaccio, Judge (retired), the Hon. Walter I. Lanier, Jr., Judge (retired), and the Hon. Ian W. Claiborne, Judge (retired), are serving as judges ad hoc by special appointment of the Louisiana Supreme Court.
[2] All three HMOs were operated by AmCare Management, Inc. (AmCare-MGT), a management company in Texas.
[3] See Augman v. City of Morgan City, XXXX-XXXX (La.App. 1 Cir. 9/23/05), 914 So.2d 583 (decided before the effective date of Act 205).
[4] In the present case, the motion for appeal was filed within the 30-day delay applicable to supervisory writs contained in Uniform Rules Court of Appeal, Rule 4-3 and, thus, an application for supervisory writs would have been timely.
[5] Original jurisdiction is distinguishable from appellate and supervisory jurisdiction. La. CONST. art. V, § 10(A).
[6] Other courts having original jurisdiction may, or may not, have parish-wide territorial jurisdiction. La. CONST. art. V, §§ 15(A) and 18; La. C.C.P. arts. 4851 and 4916.
[7] The venue provisions of Article 1034 do not supercede a mandatory Louisiana venue statute such as La. R.S. 13:510(B) pertaining to suits against political subdivisions of the State. See Foltner v. James, 2000-2352, pp. 1-2 (La.App. 4 Cir. 1/17/01), 779 So.2d 57, 58, writ denied, XXXX-XXXX (La.4/12/01), 793 So.2d 159; Service Master Action Cleaning, Inc. v. Clovis Hendry Ind., Inc., 98-2109, p. 4 (La.App. 1 Cir. 2/2/99), 753 So.2d 264, 266; Cohen v. Landry, 548 So.2d 115, 116 (La.App. 4 Cir.1989). There is no mandatory Louisiana venue statute applicable herein and, as previously indicated, La. R.S. 22:732.3 A controls in Louisiana.
[8] Article 21.28 has subsequently been repealed. It was replaced with provisions now contained in V.A.T.S. Insurance Code article 21A.001 et seq. However, pursuant to the express provisions of the enacting legislation, the law in effect at the time of institution of the suit controls. Because these suits were filed before the repeal of article 21.28, the prior law controls. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588798/ | 972 So.2d 579 (2008)
Linda JONES
v.
STATE of Mississippi.
No. 2007-KM-00344-SCT.
Supreme Court of Mississippi.
January 10, 2008.
David M. Holly, Greenwood, attorney for appellant.
Office of the Attorney General by Billy L. Gore, attorney for appellee.
*580 Before WALLER, P.J., DICKINSON and LAMAR, JJ.
WALLER, Presiding Justice, for the Court.
¶ 1. Aggrieved by the circuit court's dismissal of her appeal from a guilty-plea-conviction in justice court for first-offense DUI and careless driving, Linda Jones seeks review by this Court. We reverse and remand, finding the Circuit Court of Tunica County was in error for failing to allow a trial de novo.
DISCUSSION
¶ 2. Jones's claim of error is that the circuit court abused its discretion by denying her the right to a trial de novo after conviction in a justice court, a claim which is not disputed by the State.[1] The right to appeal from any conviction of a criminal offense from justice court is provided under Section 99-35-1 of the Mississippi Code Annotated (Rev.2007).[2] The statute makes no exception as to appeals with the inclusive language, "[i]n all cases of conviction of a criminal offense." Id. The statute does not differentiate based upon the manner of conviction, plea or trial, and we are constrained from doing so. Further, the mandatory language within the statute, "[o]n appearance of the appellant in the circuit court the case shall be tried anew" precludes dismissal of an appeal by the circuit court. Id. (Emphasis added).
¶ 3. Though this Court has not spoken to this issue in sixty years, we uniformly and consistently have held that any defendant who has been convicted of a criminal offense in a justice court may appeal even though he or she pleaded guilty. Neblett v. State, 75 Miss. 105, 21 So. 799 (1897). A convicted defendant, although he may have pleaded guilty, may take an appeal to circuit or county court and be granted a trial de novo. Little v. Wilson, 189 Miss. 825, 199 So. 72, 73 (1940). Pleading guilty in justice court does not estop a defendant from appealing to the circuit court. Ball v. State, 202 Miss. 405, 32 So.2d 195, 196 (1947).
¶ 4. The dissent makes note that there is nothing in the record to show that Jones's plea was not voluntarily and knowingly made. However, the record must affirmatively show that the plea was voluntary and knowingly made. Boykin v. Ala., 395 U.S. 238, 239-42, 89 S.Ct. 1709, 1710-12, 23 L.Ed.2d 274, 277-79 (1969) (error to accept a guilty plea on a silent record without any showing that the plea was intelligent and voluntary). The absence of proof is no proof.
¶ 5. Unlike circuit and county courts, stenographic notes of justice court proceedings are not required. See Miss.Code Ann. §§ 9-13-1 to 9-13-63 (Rev.2002). In this case, there is no transcript or record of any plea colloquy between Jones and the justice court to review constitutional safeguards required for pleas. See Dock v. State, 802 So.2d 1051, 1054-56 (Miss.2001) (citing Boykin, 395 U.S. at 239-42, 89 S.Ct. 1709). The appellate record contains only a few documents, including the intoxilyzer test, the ticket/affidavit, the waiver of attorney form, and order adjudicating guilt.
¶ 6. Regardless, statutory authority mandates that Jones's appeal to the circuit court be tried de novo. See Miss.Code Ann. § 99-35-1 (Rev.2007).
*581 CONCLUSION
¶ 7. We reverse the judgment of the circuit court dismissing Jones's appeal and remand this case to the Circuit Court of Tunica County for a trial de novo on the merits.
¶ 8. REVERSED AND REMANDED.
DIAZ, P.J., CARLSON, GRAVES, DICKINSON, RANDOLPH AND LAMAR, JJ., CONCUR. EASLEY, J., DISSENTS WITH SEPARATE WRITTEN OPINION JOINED BY SMITH, C.J.
EASLEY, Justice, Dissenting.
¶ 9. Linda Jones entered a guilty plea to the charge of DUI first offense and careless driving in the Justice Court of Tunica County, Mississippi. After pleading guilty in justice court, Jones appealed her conviction to the Circuit Court of Tunica County. Circuit Court Judge Albert B. Smith, III, presided over Jones's case. Judge Smith examined whether Jones's guilty plea was voluntary, knowing, and freely given. Nothing in the record was presented to show that the plea was not voluntarily and knowingly made. Jones does not argue that the plea was based on any coercion or misunderstanding. Clearly, Jones admitted her guilt and pleaded guilty. Therefore, no factual dispute is alleged in this case. This Court should not be in the practice of making excuses for those that break the law.
¶ 10. Judge Smith declined to allow Jones a de novo review in the circuit court based on the admission and guilty plea. De novo means "anew" or "afresh." Black's Law Dictionary 226 (5th ed.1983). De novo review allows the court to reexamine the evidence decided by the finder of fact, which is viewed in a light most favorable to the nonmoving party as opposed to being bound by the fact finders' determination. See Cockrell v. Pearl River Valley Water Supply Dist., 865 So.2d 357, 360 (Miss.2004); see also Conrod v. Holder, 825 So.2d 16, 18 (Miss.2002).
¶ 11. However, here there is no factual dispute. Jones stated under oath that she was guilty. "A plea of guilty is more than a confession which admits that the accused did various acts; it is itself a conviction; nothing remains but to give judgment and determine punishment." Boykin v. Ala., 395 U.S. 238, 242, 89 S.Ct. 1709, 1711-12, 23 L.Ed.2d 274 (1969). She made no assertion that she had been misled or coerced into confessing her guilt when she, in fact, was not guilty. Had she made such an assertion, then even though she had pleaded guilty, there would be a factual dispute for the circuit court to reexamine.
¶ 12. Likewise, had Jones pleaded nolo contendere, which means "I will not contest it," or had he been tried and convicted in a bench trial or a jury trial, a factual dispute would then exist, and the conviction could be reexamined. See Black's Law Dictionary 545 (5th ed.1983). While Mississippi Code Annotated Section 99-35-1 (Rev.2007) provides for de novo appeal to circuit court from justice court in cases of conviction of a criminal offense, it is illogical to apply that allowance where a guilty plea was undisputably made voluntarily, knowingly, and without coercion or misunderstanding. Therefore, I do not agree with this Court's holdings in Ball v. State, 202 Miss. 405, 32 So.2d 195 (1947), and Little v. Wilson, 189 Miss. 825, 199 So. 72 (1940), that a de novo appeal from justice court to circuit or county court is appropriate in every case where there was a guilty plea in justice court, especially in cases where no irregularities in the process are alleged.
¶ 13. That being said, I do not in any way disagree that de novo appeal of the *582 evidence is completely proper in cases of nolo contendere, trial, or where the guilty plea is in dispute. However, I am troubled by situations such as this case, where a defendant represents under oath to the court one thing as to the evidence and then asks to be allowed to change his or her position, again under oath, as to the evidence in another court, while making no allegation of irregularities with the process. What then is the point of allowing guilty pleas in the justice court system, if they can be automatically set aside and the case retried de novo by simply appealing to circuit or county court? The law should protect the innocent, not the guilty.
¶ 14. Nowhere in Jones's appeal does she assert that the justice court rendered an incorrect punishment or legal ruling to justify a de novo review of the law in this case. Nowhere is any dispute raised as to the evidence of her guilt. See Wilson v. State, 967 So.2d 32, 41 (Miss.2007) ("This issue presents a question of law, for which the standard of review is de novo."); DeLoach v. State, 722 So.2d 512, 518 (Miss. 1998) (citing Rose v. State, 586 So.2d 746, 751 (Miss.1991)); Harrison County v. City of Gulfport, 557 So.2d 780, 784 (Miss.1990).
¶ 15. I disagree that the outcome reached here was intended by allowing a de novo appeal of a criminal conviction from justice court to circuit or county court. To allow Jones to escape due to a technicality is a slap in the face of justice.
SMITH, C.J., joins this opinion.
NOTES
[1] Jones was fined $758.50, sentenced to forty-eight hours in jail (which were suspended), placed on eleven months, twenty-eight days probation, and ordered to attend Mississippi Alcohol Safety Education Program.
[2] See also Rule 12.02(c) of the Uniform Circuit and County Court Rules. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3034137/ | United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 03-2941
___________
United States of America, *
*
Appellee, * Appeal from the United States
* District Court for the Eastern
v. * District of Missouri.
*
Omawale Malachi Sims, * [UNPUBLISHED]
*
Appellant. *
___________
Submitted: March 5, 2004
Filed: March 8, 2004
___________
Before MORRIS SHEPPARD ARNOLD, FAGG, and SMITH, Circuit Judges.
___________
PER CURIAM.
Omawale Sims appeals his conviction and the sentence the district court*
imposed after Sims pleaded guilty to distributing cocaine base, in violation of 21
U.S.C. § 841(a)(1). Sims’s counsel has filed a motion to withdraw and a brief under
Anders v. California, 386 U.S. 738 (1967), questioning the length of the sentence.
We enforce the appeal waiver included in the plea agreement and limit our review to
issues not included within the scope of the waiver. We find Sims’s pro se ineffective-
*
The Honorable Henry E. Autrey, United States District Judge for the Eastern
District of Missouri.
assistance claims are not properly before us. See United States v. Hughes, 330 F.3d
1068, 1069 (8th Cir. 2003). Based on our independent review under Penson v. Ohio,
488 U.S. 75, 80 (1988), we find no nonfrivolous issues.
We thus grant counsel's motion to withdraw and affirm the judgment of the
district court.
______________________________
-2- | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1017723/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 05-4217
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
PAUL A. SCHYBAL,
Defendant - Appellant.
Appeal from the United States District Court for the Southern
District of West Virginia, at Beckley. David A. Faber, Chief
District Judge. (CR-04-116)
Submitted: October 26, 2005 Decided: November 21, 2005
Before TRAXLER and KING, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
Mary Lou Newberger, Federal Public Defender, Jonathan D. Byrne,
Appellate Counsel, Edward H. Weis, Assistant Federal Public
Defender, Charleston, West Virginia, for Appellant. Kasey Warner,
United States Attorney, W. Chad Noel, Assistant United States
Attorney, Charleston, West Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
A jury convicted Paul A. Schybal of mailing a threatening
letter, in violation of 18 U.S.C.A. § 876 (West Supp. 2005). The
district court sentenced him to thirty-seven months’ imprisonment.
On appeal, Schybal asserts that insufficient evidence supported his
conviction and that his sentence was unreasonable. We affirm.
Schybal contends that, although he wrote the letter at
issue, there is no evidence that he was the one who mailed it. He
was a prison inmate when the letter was mailed, and he points to
the nearly two month time gap between the date on the letter and
date of the postmark to show that anyone could have found the
letter and mailed it. We must uphold a jury’s verdict of guilty if
there is substantial evidence in the record to support it.
Glasser v. United States, 315 U.S. 60, 80 (1942). In determining
whether the evidence is substantial, we view the evidence in the
light most favorable to the Government, and inquire whether there
is evidence sufficient to support a finding of guilt beyond a
reasonable doubt. United States v. Burgos, 94 F.3d 849, 862 (4th
Cir. 1996). In order to be convicted under 18 U.S.C. § 876, a
defendant must have knowingly deposited a threatening communication
in the mail. United States v. Maxton, 940 F.2d 103, 105 (4th Cir.
1991).
Here, the evidence is undisputed. Schybal wrote and
addressed a threatening letter to a corrections officer. He had
- 2 -
written and sent similar letters in the past to the same officer,
as well as to another prison employee. He resided in the prison on
the date the threatening letter signed and addressed by him was
sent from the prison. We find that the evidence was sufficient to
conclude that Schybal sent the letter at issue. See Petschl v.
United States, 369 F.2d 769, 772 (8th Cir. 1966)(holding that proof
of mailing and causing mailing may be shown by circumstantial
evidence).
Schybal, who was sentenced after the Supreme Court’s
decision in United States v. Booker, 125 S. Ct. 738 (2005), argues
that his sentence was unreasonable because it was greater than
necessary to comply with the purposes of 18 U.S.C.A. § 3553(a)
(West 2000 & Supp. 2005), and because it did not address his mental
illness. Following Booker, we review a sentence for
reasonableness, and the district court is required to consider the
guideline range, as well as the other factors in § 3553(a). See
United States v. Hughes, 401 F.3d 540, 546-47 (4th Cir. 2005). The
factors in § 3553(a) include: (1) the nature and circumstances of
the offense; (2) the history and characteristics of the defendant;
(3) the need for the sentence imposed to reflect the seriousness of
the offense, to promote respect for the law, and to provide just
punishment and rehabilitation; (4) the need to protect the public;
and (5) the guidelines range.
- 3 -
In this case, the record reflects that the district court
adequately and properly considered the § 3553(a) sentencing
factors. The court noted the seriousness of the offense, Schybal’s
criminal history, the need for maximum deterrence, the threat to
the victims, and the guideline range. While Schybal contends that
he needs only strict home confinement and medical treatment, we
hold that the district court properly considered the statutory
factors and appropriately arrived at a sentence. We can find no
basis to conclude that Schybal’s sentence is unreasonable.
Accordingly, we affirm Schybal’s conviction and sentence.
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
- 4 - | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2740665/ | Third District Court of Appeal
State of Florida
Opinion filed October 8, 2014.
Not final until disposition of timely filed motion for rehearing.
________________
No. 3D13-2769
Lower Tribunal No. 05-22072
________________
Magic Tinting Window & Car Alarm, Inc.,
Appellant,
vs.
Scottsdale Insurance Company,
Appellee.
An Appeal from the Circuit Court for Miami-Dade County, Lisa S. Walsh,
Judge.
Stabinski & Funt, P.A., and Todd J. Stabinski, for appellant.
Conroy, Simberg, Ganon, Krevans, Abel, Lurvey, Morrow, & Schefer, P.A.,
and Hinda Klein and Thomas Regnier (Hollywood), for appellee.
Before ROTHENBERG, LOGUE and SCALES, JJ.
SCALES, J.
This case is before us on Scottsdale Insurance Company’s (Scottsdale)
amended motion for appellate attorney fees filed pursuant to Florida Rule of
Appellate Procedure 9.400. Scottsdale’s claim for fees is based upon section
768.79, Florida Statutes (2013) (Florida’s “Offer of judgment and demand for
judgment” statute); Scottsdale served a proposal for settlement on Magic Tinting
Window & Car Alarm, Inc. (Magic Tinting) on or about March 21, 2006.
Scottsdale prevailed below and obtained a final judgment in its favor on
October 2, 2013. Magic Tinting filed its notice of appeal of the final judgment
with this court on October 29, 2013. Before any briefing, Magic Tinting
voluntarily dismissed its appeal on August 18, 2014.
We deny Scottsdale’s amended motion for appellate attorney fees. See
Sanchez v. State Farm Fla. Ins. Co., 997 So. 2d 1209, 1209 (Fla. 3d DCA 2008)
(denying motion for appellate attorney fees when appellate record reflected “de
minimis” activity).1
Motion denied.
ROTHENBERG, J., concurs.
1 On the basis of Sanchez, we are constrained to deny Scottsdale’s amended motion
for appellate attorney fees. If we were writing on a clean slate, however, we would
grant Scottsdale’s motion for fees consistent with Chief Judge Shepherd’s dissent
in Sanchez and our sister courts’ conclusions in Braxton v. Grabowski, 125 So. 3d
936 (Fla. 2d DCA 2013), and First Real Estate, LLC v. Grant, 88 So. 3d 1073 (Fla.
1st DCA 2012).
2
LOGUE, J., concurring.
I would simply deny Scottsdale’s amended motion for appellate attorney
fees. See Sanchez v. State Farm Fla. Ins. Co., 997 So. 2d 1209 (Fla. 3d DCA
2008).
3 | 01-03-2023 | 10-08-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1736641/ | 727 N.W.2d 374 (2006)
2007 WI App 19
STATE
v.
MAERTZ[1].
No. 2006AP333-CR.
Wisconsin Court of Appeals.
December 20, 2006.
Unpublished opinion. Affirmed.
NOTES
[1] Petition for Review Filed | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1646374/ | 480 So.2d 739 (1986)
STATE of Louisiana
v.
David Gene McFADDEN.
No. 85-K-2043.
Supreme Court of Louisiana.
January 13, 1986.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2440753/ | 963 N.E.2d 245 (2012)
357 Ill. Dec. 292
HARVARD
v.
NORTHEAST ILLINOIS REGIONAL COMMUTER R.R. CORP.
No. 113340.
Supreme Court of Illinois.
January 1, 2012.
Disposition of petition for leave to appeal Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1591930/ | 135 S.W.3d 561 (2001)
WRIGHT MEDICAL TECHNOLOGY, INC.,
v.
Bernard GRISONI and Biogeneration, Inc.
Court of Appeals of Tennessee.
September 17, 2001 Session.
December 18, 2001.
Application for Permission to Appeal Denied May 20, 2002.
*565 Leo Bearman, Jr., George T. Lewis, III, and Marianne B. Matthews, Memphis, Tennessee, for the Plaintiff/Appellant, Wright Medical Technology, Inc.
Ronald D. Krelstein, Germantown, Tennessee, and Steven M. Markowitz, Memphis, Tennessee, for the Defendant/Appellees, Bernard F. Grisoni, and Biogeneration, Inc.
Michael I. Less and Ted M. Hayden, Memphis, Tennessee, for the Appellee, Travelers Casualty and Surety Company of America.
Lucian T. Pera and W. Bryan Smith, Memphis, Tennessee, submitting Amicus Curiae Brief for William H. Haltom, Jr. *562 *563
Application for Permission to Appeal Denied by Supreme Court May 20, 2002.
*564 OPINION
HOLLY KIRBY LILLARD, J., delivered the opinion of the court, in which ALAN E. HIGHERS, J. and DAVID FARMER, J., joined.
*566 This case involves the alleged use of confidential information by an ex-employee. The defendant employee worked for the plaintiff employer developing a medical product. The employee signed an agreement prohibiting the use of confidential information after his employment ended, but did not sign a non-competition agreement. The employee was terminated and thereafter began manufacturing a competing medical product. The plaintiff employer sued and obtained a temporary injunction prohibiting the ex-employee from manufacturing the product. The trial court later dissolved the injunction. Subsequently, it found the defendant employer liable for malicious prosecution and punitive damages, awarding damages of over $9 million. The employer appeals. We affirm in part, reverse in part and modify. We reverse the finding of malicious prosecution, holding that the evidence is insufficient to establish malice or lack of probable cause. We also reverse the award of punitive damages. We affirm the trial court's dissolution of the injunction against the former employee, and find that the compensatory damages are limited by the amount of the injunction bond. Consequently, the award of compensatory damages is modified to this amount.
This case involves the alleged use of confidential information by an ex-employee. Plaintiff/Appellant Wright Medical Technology, Inc. (Wright), is a Memphis corporation which develops and markets medical products. Defendant/Appellee Bernard Grisoni ("Grisoni") is a former employee of Wright, and Defendant/Appellee Biogeneration, Inc. ("Biogeneration") is the company Grisoni started after his employment with Wright was terminated.
FACTS AND PROCEEDINGS
Grisoni was hired by Wright in February 1994 as manager of silicone materials and process research. Grisoni holds a bachelor's degree in material science, master's degrees in polymer technology and business administration, and a Ph.D. in manufacturing engineering. Grisoni began working in the field of manufacturing medical devices in 1985. Before coming to Wright, Grisoni worked with silicone materials at Dow Corning. Immediately before joining Wright, Grisoni was the project manager for the development of interocular lenses at Allergan Medical Optics.
When Grisoni became employed at Wright, he was required to sign a confidentiality agreement. The agreement read, in pertinent part:
Other than as required in my duties as an employee of Wright Medical Technology, I will not disclose to anyone or use either during or after my employment; except with the prior written consent of Wright Medical Technology, any trade secret, confidential know-how or confidential business or technical information of Wright Medical Technology. The foregoing obligation shall also apply to any trade secrets or other confidential information of any third party learned by me as a Wright Medical Technology employee and which Wright Medical Technology has an obligation to maintain in secrecy. The obligations of secrecy and non-use of this paragraph shall not apply to any information which has become publicly available through no fault of my own.
Thus, the confidentiality agreement prohibited Grisoni from using or disclosing any confidential information of Wright that had not become publicly available. However, it did not include a noncompetition clause prohibiting Grisoni from developing a competing product after leaving his employment with Wright.
In 1994, Wright began developing calcium sulfate bone void fillers, and soon *567 thereafter it became one of Wright's major priorities. Bone void filler is a material used by an orthopedic surgeon to fill a cavity appearing in a patient's bone, resulting from either traumatic injury or the surgical removal of diseased or infected bone matter. The bone void filler material is grafted over the area of missing bone or void until the area is replenished by the body's own natural bone formation. Use of a bone void filler decreases the risk of infection and harmful scar tissue while the natural bone regenerates. Traditionally, surgeons have transplanted bone matter from other parts of the patient's body, such as the patient's ribs, or implanted pieces of bone from a bone bank. Synthetic materials have also been used with varying degrees of success. Calcium sulfate has been used as an artificial bone void filler for at least a century. The advantage of calcium sulfate is that it is absorbed into the body, that is, it dissolves, at roughly the same rate as the new bone growth. This allows for the cavity to remain filled while the new bone forms directly behind the calcium sulfate filler material.
Wright experimented with several methods of calcium sulfate bone graft production. Calcium sulfate dihydrate, also known as gypsum, is a natural occurring compound which is mined and processed. The resulting powder can be used in both food and pharmaceutical production. Under the "pressed" method of bone void filler production, a small amount of stearic acid is added as a binding agent to the calcium sulfate dihydrate powder. The mixture is then compressed into small tablets or pellets to be surgically grafted into the bone cavity. A second method of bone void filler production involves the removal of water from the calcium sulfate dihydrate, thereby creating calcium sulfate hemihydrate. This can be done by simply heating the compound in order to remove the water, forming beta-type hemihydrate, or by a combination of heat and pressure to crystalize the hemihydrate, forming alfa-type hemihydrate. Regardless of which type of hemihydrate is produced, the calcium sulfate is then combined with a fixed amount of water. This results in a dihydrate in paste form. This paste can then be directly implanted into the bone cavity to solidify, or the paste can be first molded into small pellets, dried, and then surgically implanted at a later time.
Wright and other companies had tried to develop a number of calcium sulfate bone void fillers, but neither Wright nor any of Wright's competitors had gained the necessary FDA approval for the products. FDA approval was essential to developing a commercially viable product. In 1976, Congress amended the Federal Food, Drug and Cosmetic Act, 21 U.S.C.S. §§ 301 et seq. (1984) ("the Act."). The amendments to the Act require FDA clearance before a medical device can be marketed in the United States. The amendments did not cover products which existed in interstate commerce prior to May 23, 1976. New medical devices developed after that date were required to meet certain performance standards established by the FDA. To demonstrate that a product is effective and safe for use for humans, and thus obtain FDA approval, extensive animal and human clinical studies are often required.
The Act allows for clearance of a medical product through an application process whereby the submitting company demonstrates to the FDA that the non-approved device is "substantially equivalent" to a predicate device, either a pre 1976 product or a product which has already been given FDA clearance. This "piggybacking" approval process permits the submitting company to obtain FDA clearance for a medical product without having to engage *568 in the lengthy animal and human clinical studies that would otherwise be necessary. The FDA exercises a great deal of discretion in determining whether a product will be approved as "substantially equivalent" to a predicate product. If the application, known as a 510(k), fails to meet FDA approval, the FDA will usually provide feedback informing the company of the factors it considered in concluding that the two compared products were not "substantially equivalent." The submitting company then has several options to obtain clearance. The company can modify its product to more closely mimic the predicate device, or find a predicate device more similar to its product and resubmit the 510(k) application. If the company's product is not modified or a new predicate product is not found, the company could use an alternate method of demonstrating "substantial equivalency," such as by using more extensive forms of testing or comparing different variables. If FDA approval is not obtained by one of these means, the company would likely be forced to engage in extensive animal and human clinical studies to obtain approval.
Once FDA clearance is given, the FDA provides the public limited access to the submitting company's 510(k) application by placing a summary of it on the FDA's website. Information not included in the FDA summary is normally kept confidential.
Within a few months of beginning his employment with Wright, Grisoni was given responsibility over Wright's calcium sulfate bone void filler project. He worked on this project for the duration of his employment at Wright. Prior to joining Wright, Grisoni had no experience in the area of calcium sulfate bone void filler products and had reviewed no literature on such products. Once Grisoni was given the responsibility for developing these products, he researched a variety of publicly available sources on uses of calcium sulfate bone grafts.
In working on the calcium sulfate bone filler project, Grisoni worked closely with Dr. Warren Haggard ("Haggard"), also employed by Wright. Haggard holds a Ph.D. in biomedical engineering and is an expert in biomaterials. Haggard had worked for Wright since August 1993. Grisoni also worked with Robert Churinetz ("Churinetz"), who was the Wright official responsible for quality assurance and regulatory approval. Grisoni worked with Churinetz on obtaining FDA approval for Wright's bone void filler. Obtaining FDA approval for Wright's bone void filler proved to be a lengthy and difficult process.
To get the raw materials for the bone void filler, Wright entered into a licensing agreement with U.S. Gypsum ("USG"). The agreement with USG also enabled Wright to gain access to USG's expertise in calcium sulfate bone void fillers. USG was one of the largest producers of calcium sulfate and had been engaged with other companies in extensive research into the use of calcium sulfate as a bone void filler.
While overseeing this project for Wright, Grisoni met with several individuals who were instrumental in the development of calcium sulfate bone void fillers. On one occasion in April 1995, Grisoni met with Max Sherman, a former employee of Zimmer, another company that manufactured orthopedic devices. While at Zimmer, Sherman had been in charge of regulatory affairs. Sherman provided Wright a bibliography developed at Zimmer containing several articles on the production and use of calcium sulfate bone void fillers, which Grisoni used to do background research. According to Sherman, Zimmer had tried to develop a calcium sulfate bone *569 void filler but was unsuccessful in getting its 510(k) application approved by the FDA, primarily because Zimmer had used actual bone as the predicate device for its bone void filler in the 510(k) application. Sherman felt that a better predicate device for FDA approval would be Ethicon, a calcium sulfate bone filler device in pellet form which had been marketed unsuccessfully in the 1950s and 1960s. After production of Ethicon was ceased, the remaining supply of Ethicon pellets were given to Dr. Leonard Peltier, who supported the development of Ethicon.
In light of Sherman's comments, Wright made a decision to use Ethicon as the predicate device in the 510(k) application for FDA approval of its bone void filler. Wright's initial bone void filler was an antibiotic loaded calcium sulfate product in pellet form. However, by mid 1995, Wright's major effort was a kit, called Osteoset, which contained calcium sulfate hemihydrate powder, a vial of liquid, a mixing bowl and a mixing tool. The surgeon would mix the contents of the kit into a calcium sulfate paste and then graft the paste into the bone cavity, where it would then solidify. In September 1995, Wright's 510(k) application on the Osteoset kit was submitted to the FDA. The FDA denied approval of the 510(k) application, citing the technological differences between implanted pellets such as Ethicon and the direct application of a calcium sulfate paste.[1] In denying approval for the 510(k) application, the FDA also noted that Wright had not demonstrated that Ethicon was sold in interstate commerce prior to March 1976.
After this initial failure, Wright determined that its bone void filler needed to be in the form of calcium sulfate pellets, similar to Ethicon, in order to obtain FDA approval. In order to develop such a product, Wright obtained a single package of Ethicon pellets from Dr. Peltier. Wright then began consulting with Dr. Peltier on the development of Wright's own calcium sulfate pellets.
Once Wright had access to Ethicon pellets, Wright employees began to "reverse engineer" calcium sulfate pellets which closely proximated Ethicon pellets. In January 1996, Wright opened the single package of Ethicon pellets and sent the contents to USG for chemical analysis. Within a few weeks after acquiring the Ethicon pellets from Dr. Peltier, Wright had created the prototype of its Osteoset pressed pellets, containing 98% calcium sulfate dihydrate and 2% stearic acid.
In order to gain FDA approval, Wright needed to demonstrate that the Osteoset pellets would perform similarly to Ethicon pellets when implanted into the human body. Since Ethicon's dissolution inside the human body had previously proven successful, Churinetz proposed to conduct dissolution tests of the two products inside the laboratory. Churinetz and Grisoni conducted the comparison by using water and phosphate buffered saline solution as the dissolution mediums. By establishing that the two products, Osteoset and Ethicon, had similar dissolution rates in water, which has less density than body fluids, and phosphate buffered saline solution, which has a density greater than body fluids, Churinetz hoped to demonstrate to the FDA that the dissolution rates for both Osteoset and Ethicon would correlate with the rate of new bone growth when implanted in the human body. In February 1996, *570 Wright conducted the dissolution tests and verified that Osteoset had similar dissolution rates to Ethicon.
These dissolution tests were then incorporated into Wright's 510(k) application in order to show that the two products had "substantially equivalent" dissolution rates. Affidavits from former Ethicon employees and Dr. Peltier were submitted to show that Ethicon had been marketed in interstate commerce prior to May 1976. In June 1996, Wright's 510(k) application for Osteoset was approved by the FDA. Two months later, Wright began marketing Osteoset to the public. In July 1996, the summary of Wright's 510(k) application was made available on the FDA's website.
After Wright obtained FDA clearance for Osteoset, it switched to a casting process for producing Osteoset pellets. The process required that Wright first convert the dihydrate powder supplied by USG into hemihydrate powder. Water could then be added to form a dihydrate paste. Wright had previously learned from USG that either the alpha-type hemihydrate or beta-type hemihydrate could be used to produce calcium sulfate paste.[2] Wright opted to use alpha-type hemihydrate in its molding process.
Wright produced alpha-type hemihydrate crystals using a calcination process involving heat and pressure. USG had previously developed temperature and pressure ranges for the calcination process, and Wright acquired this information as part of its agreement with USG. After the calcination process was completed, the hemihydrate powder was mixed with stearic acid and water to create a calcium sulfate dihydrate paste. This paste could then be mass molded and dried into pellets similar in size and composition to the pressed pellets. However, Wright discovered that the dissolution rate of the cast pellets was different than the dissolution rate of the pressed pellets. By decreasing the amount of stearic acid in the mixture of the cast pellets, Wright achieved a dissolution rate equivalent to that of the pressed pellets.
Metal molds were originally used to mold the Osteoset pellets. However, to allow the pellets to expand during drying, Grisoni designed a flexible silicon mold. The pellets were bottled and then underwent a sterilization process using gamma radiation. Once the sterilization was completed, the pellets were packaged and stored for distribution.
In August 1997, Wright implemented a company-wide reduction in force in which approximately 75 employees were terminated. As part of the reduction in force, on August 19, 1997, Grisoni's employment with Wright was terminated. Within a few days of his termination, Grisoni decided to start his own business dealing in tissue repair, which he called Biogeneration, Inc. Grisoni's experience at Wright, as well as several articles appearing in Memphis newspapers, made him aware of the growing market in calcium sulfate bone substitutes. Grisoni chose to manufacture calcium sulfate bone filler because such filler can be manufactured without a large amount of startup capital. Grisoni later testified that he went to area libraries to review books and articles on calcium sulfate. Many of these articles were listed in the bibliography of Wright's technical monograph for Osteoset, published and distributed as part of Osteoset's marketing campaign. Grisoni later testified that he accessed the FDA web page to review *571 Wright's 510(k) summaries to Osteoset products.
After Grisoni's initial research, he began working on a competing bone void filler using betatype calcium sulfate hemihydrate. By September 8, 1997, less than three weeks after his termination, Grisoni had designed a prototype of his competing bone filler, which contained 98% calcium sulfate dihydrate and 2% stearic acid and was in pellet form, similar to Osteoset. On September 26, 1997, a little over a month after his termination, Grisoni submitted to the FDA a 510(k) application on his product, called ProFusion, using Osteoset as his predicate device. In his application, Grisoni described ProFusion as being "identical" to Osteoset. Also included in the 510(k) application for ProFusion were the results of dissolution studies comparing the dissolution rates of ProFusion with those of Osteoset. The studies were conducted using the same test fluids, water and phosphate buffered saline solution, as Grisoni had used previously for Wright's dissolution studies in its 510(k) application for Osteoset. Grisoni ran his test for the same number of days, eight, and used the same amount of water, 100 milliliters, as was used in conducting the Wright dissolution studies. In this manner, Grisoni was able to demonstrate to the FDA that the dissolution rates of ProFusion and Osteoset were "substantially equivalent." In April 1998, the FDA approved Grisoni's 510(k) application for ProFusion.
Meanwhile, after Grisoni was terminated, Wright began having technical problems with its antibiotic loaded bone void filler process. Consequently, not long after Grisoni was terminated, Wright asked Grisoni to return to Wright as a consultant for a limited period of time, from September 29 to October 31, 1997. On September 29, 1997, Grisoni's first day back as a consultant, Grisoni told Haggard that he was involved in developing a bone graft substitute. The next day, Grisoni met with the vice president and general counsel of Wright, Tom Patton ("Patton"), and discussed his involvement in producing a competing bone filler product. Patton reminded Grisoni of his obligations under the confidentiality agreement. Grisoni assured Patton that he was honoring the agreement.
Grisoni later testified that, while working as a consultant at Wright, Grisoni would take his ProFusion lab notebook with him, keeping it in his briefcase. He said that he took the notebook with him to Wright so that he could write down ideas. Grisoni's briefcase did not have a lock. On several occasions, Grisoni left his briefcase unattended at his desk while working in the lab or attending meetings. Grisoni's desk was located close to Haggard's office. Haggard did not attend the majority of the meetings Grisoni attended during this time.
After Grisoni's meeting with Patton regarding Grisoni's obligations under the confidentiality agreement, Patton remained concerned with the possible conflict of having Grisoni consult with Wright while Grisoni continued to develop a competing bone filler device. As a consequence, on October 8, 1997, Wright terminated Grisoni's services as a consultant. At that time, Wright had Grisoni sign a consulting agreement which, similar to the earlier confidentiality agreement, prohibited Grisoni from using or disclosing any confidential information he received from Wright pursuant to the consulting agreement.[3] Thereafter, Grisoni received a letter *572 from Patton dated October 6, 1997, informing him what Patton believed to be included within the confidentiality agreement, including the production process and regulatory strategy for Osteoset.[4] Grisoni's attorney, Fred Acuff, sent a letter to Patton denying that Grisoni had used any confidential information and offered to meet with Patton to discuss any alleged violations of the confidentiality agreement. Instead of meeting with Acuff, Patton sent a letter to Acuff stating that "whether this matter is put to rest or not is up to your client."
In early March 1998, Grisoni attended the annual meeting of the American Academy of Orthopedic Surgeons in New Orleans. During the meeting, Grisoni exhibited ProFusion and offered brochures and other information to those in attendance. Wright also had a booth at the annual meeting and saw that Grisoni was producing his own calcium sulfate bone void filler. When Patton, who by then was Wright's president, learned that Grisoni was marketing a competing product, he instructed Wright's general counsel, Michael McLaren, to investigate the matter. McLaren was an experienced attorney and a partner in the Memphis law firm of Thomason, Hendrix, Harvey, Johnson and Mitchell ("Thomason Hendrix"), as well as Wright's general counsel. McLaren reviewed Grisoni's confidentiality agreement and talked to several Wright officials, including Haggard and Churinetz. After the investigation, McLaren advised Wright to retain the Thomason Hendrix law firm to seek injunctive relief against Grisoni. Attorneys William Haltom and Robert Moore of the Thomason Hendrix firm were assigned to represent Wright in the matter.
On March 23, 1998, Grisoni sent a letter to Patton offering to meet with Wright officials to discuss any alleged violations of the confidentiality agreement. Grisoni and Acuff later met with Wright's attorneys to discuss possible resolution of the matter. The meeting was verbally combative and resulted in no resolution.
On March 31, 1998, Wright filed an action in Shelby County Chancery Court, seeking injunctive relief against Grisoni and his company, Biogeneration. The lawsuit asserted that Grisoni had violated his confidentiality agreement by using Wright's confidential information to develop ProFusion. In the complaint, Wright sought injunctive relief prohibiting the use or disclosure of any confidential information or trade secrets and asked the trial court to enjoin Grisoni from manufacturing and marketing ProFusion. The trial judge, Chancellor Neal Small, immediately issued a temporary restraining order (TRO) prohibiting any further violations of the confidentiality agreement. The TRO prohibited the use of confidential information and trade secrets but did not enjoin Grisoni from manufacturing and marketing ProFusion, so long as no confidential information *573 or trade secrets were utilized. A temporary injunction hearing was set for April 13, 1998, and Wright was ordered to post a $500 bond. On April 6, 1998, attorney Stephen Biller entered a Notice of Appearance on behalf of Grisoni.
On the date of the scheduled hearing, both parties were conducting extensive discovery. Consequently, the parties consented to an order modifying and extending the TRO until April 27, 1998. Unlike the original TRO, the modified TRO prohibited Grisoni from manufacturing or marketing ProFusion or from transferring his interest in ProFusion or his approved 510(k) application.[5]
On April 23, 1998, Grisoni filed his answer, including a jury demand. At a meeting on the morning of the scheduled hearing on April 27, Biller told Grisoni that he felt that Grisoni should not oppose Wright's request for a temporary injunction order pending a hearing on the merits. Thereafter, Biller contacted the attorney for Wright and told him that Grisoni would not oppose the temporary injunction order. The attorneys for both parties made alternate proposals regarding the wording of the order. The temporary injunction order that was finally entered contained the same language as the modified TRO, prohibiting the manufacture and marketing of ProFusion.[6] The temporary injunction order also increased the injunction bond to $7500. Travelers Casualty and Surety Company (Travelers) was the surety under the bond. While Biller, on behalf of Grisoni, consented to the temporary injunction, Biller and Grisoni maintained that Grisoni had used no confidential information. Thereafter, the parties continued discovery, including Grisoni's deposition. In his deposition, Grisoni asserted that ProFusion was substantially different from Osteoset.
On June 3, 1998, Grisoni and Biller attended a settlement conference at the law offices of Thomason Hendrix. Attorney William Haltom represented Wright at the settlement conference. Unbeknownst to the attorneys, Grisoni secretly tape recorded the settlement conference. During the meeting, Haltom asserted that Grisoni's testimony in his deposition, that ProFusion was altogether different than Osteoset, was inconsistent with the prior claim made in his 510(k) application that the two products were "identical."[7] Haltom said that, unless Grisoni agreed to surrender his 510(k) on ProFusion, Wright intended to go to both the chancery court and the FDA and inform them of Grisoni's contradictory statements.
By September 1998, the relationship between Biller and Grisoni had deteriorated and a consent order was entered substituting Steven Markowitz as the attorney for Grisoni. On November 23, 1998, Grisoni filed a motion to dissolve or modify the temporary injunction, asserting that (1) he had never consented to the language in the temporary injunction order dealing specifically with ProFusion and (2) he had not violated the confidentiality agreement.
The hearing on Grisoni's motion to dissolve the injunction was held on January 26, 1999. At the outset, Wright's attorney assumed that the only issue the trial court planned to consider was whether Grisoni had consented to the temporary injunction; *574 consequently, he assumed that Grisoni would have the burden of showing lack of consent to the injunction. However, the trial judge, Chancellor Walter Evans,[8] decided that, since no evidence had ever been presented on whether Wright was entitled to a temporary injunction, the hearing on dissolving the temporary injunction would be consolidated with the hearing on Wright's request for a permanent injunction.[9] Accordingly, over Wright's objection, the burden of proof was assigned to Wright. Grisoni did not object to proceeding on Wright's request for a permanent injunction, despite having originally demanded a jury trial.
At the outset of the hearing, Grisoni objected to the amount of the injunction bond, which was, at the time, $7,500. Grisoni noted that the injunction would cause him to miss the Annual Meeting of the American Academy of Orthopedic Surgeons, the premier event for marketing a product such as ProFusion. In light of this, the trial judge increased the amount of the injunction bond from $7,500 to $250,000. On February 1, 1999, Travelers issued a rider to the original injunction bond increasing the penal sum to $250,000.
Testimony was heard over a six week period. Wright first presented testimony from attorney Biller that Grisoni had in fact consented to the temporary injunction. After Biller's testimony, the trial court decided that the hearing should be on Wright's request for a permanent injunction. Wright was then obliged to present evidence showing that Grisoni had, in fact, violated his confidentiality agreement with Wright during the course of Grisoni's development of a competing bone void filler. The evidence presented by Wright included evidence of the following:(1) Grisoni had no experience with calcium sulfate bone void fillers before coming to Wright; (2) while with Wright, Grisoni was placed in charge of Wright's calcium sulfate bone void filler project; (3) while overseeing the project, Grisoni was given access to a variety of technical sources of information that Wright considered confidential, including information from USG that either alpha-type or beta-type hemihydrate could be used in producing bone void fillers; (4) by trial and error, and at substantial time and investment, Wright was able to develop Osteoset, get regulatory approval, and bring Osteoset to the market; (5) after being terminated from Wright, Grisoni was able to develop a competing bone void filler within a matter of weeks; and (6) Grisoni was able to get FDA approval by showing that his competing bone void filler was "substantially equivalent" to Osteoset.
For each piece of information or technical know-how Wright asserted to be confidential, Grisoni sought to show either that the information was publicly available, and therefore outside the scope of the confidentiality agreement, or that Grisoni's process was different from the processes he learned while at Wright. Grisoni testified extensively about the independent research he did after his termination on calcium sulfate and the FDA approval process. Grisoni also testified extensively on the differences between ProFusion and Osteoset in composition, production processes, and testing.
Grisoni also questioned the credibility of Wright's witnesses. Grisoni noted that *575 Wright had asserted in its complaint that Grisoni had developed his prototype of ProFusion "by" September 8, 1997, a matter of weeks after his termination. Grisoni asserted that he had told no one this date, and that the only place that information appeared was in the lab notebook he brought to Wright in his brief case while working as a consultant. When questioned about this in his testimony, Haggard was unable to say how Wright arrived at September 8, 1997 date in its complaint. The lab notebook was not produced to Wright until discovery was commenced, after Wright's complaint was filed in March 1998.[10] From these facts, Grisoni asserted that Haggard or another employee of Wright must have gained access to Grisoni's briefcase and looked at his lab notebook while he was consulting for Wright in October 1997.
At the hearing to dissolve the injunction, for reasons that are not entirely clear from the record,[11] the attorney for Wright, William Haltom, was subpoenaed to testify. In his testimony, Haltom was questioned at length about the settlement conference with Grisoni at which Haltom told Grisoni that, if Grisoni refused to give up his 510(k) on ProFusion, Wright would go to the chancery court and to the FDA to tell both of Grisoni's contradictory statements on whether ProFusion was "identical" to Osteoset. The questioning and Haltom's testimony were often contentious. Later in the hearing, the tape Grisoni secretly made of the settlement conference was disclosed and played for the trial court, in an effort to show that Haltom had "threatened" Grisoni but would not admit to doing so in his testimony.
After the hearing was concluded, on March 10, 1999, the trial court issued from the bench its findings of facts and conclusions of law. The trial court stated the issue as "whether the defendant used confidential information or trade secrets of the plaintiff which had not become publicly available." The trial court noted that it was very impressed with Grisoni's knowledge, expertise and credibility. The trial court made no findings at that time regarding the credibility of Wright's witnesses or of Wright's attorney, William Haltom. The trial court found, inter alia, that any information on which Grisoni relied to develop ProFusion was not confidential but was publicly available. Based on its view of the evidence, and its determinations of credibility, the trial court concluded that ProFusion was developed as a result of Grisoni's ingenuity, hard work and ability, and not as a result of any misappropriation of confidential information or trade secrets of Wright.
After the trial court issued its ruling from the bench, Wright indicated that it intended to file an interlocutory appeal. Wright then sought from the trial court a stay of the trial court's order, pending its interlocutory appeal. The trial judge declined to rule on Wright's motion for a *576 stay. By order dated March 22, 1999, the trial court dissolved the injunction and set a hearing for March 29, 1999 to determine the amount of any damages Grisoni sustained as a result of the wrongfully issued injunction.
Shortly thereafter, on March 24, 1999, Wright filed its motion for interlocutory appeal pursuant to Rule 10 of the Tennessee Rules of Appellate Procedure, as well as a motion under Rule 7 of the appellate rules for a stay of the trial court's order. The appellate court immediately stayed the trial court's order dissolving the injunction, conditioned upon Wright posting an additional $250,000 bond,[12] making a total bond of $500,000. On March 31, the appellate court stayed any further proceedings in the trial court in order to permit the appellate court to address Wright's motion for interlocutory appeal. The earlier order staying dissolution of the injunction also remained in effect.
On May 11, 1999, the appellate court entered an order, holding that the injunction against Grisoni should remain in place until final disposition of the case, and finding that there was nothing further for the appellate court to consider at that time. The appellate court remanded the matter to the trial court for a hearing on damages and entry of final judgment, and noted that the trial court had the authority to determine the adequacy of the bond pending entry of final judgment as well as pending appeal.
Thereafter, on May 19, 1999, Wright filed a petition with the appellate court for a rehearing of the appellate court's denial of Wright's Rule 10 motion for interlocutory appeal. Wright argued that remanding the cause to the trial court for a hearing on damages was inappropriate because Grisoni had never requested damages in any pleading filed with the trial court. On May 24, Grisoni filed a response to Wright's petition to rehear, but did not address the issue of damages.
Meanwhile, on May 26, 1999, Grisoni filed a motion with the trial court to increase the injunction bond to $5 million. Grisoni's motion before the trial court noted that the appellate court had previously required an additional $250,000 bond, which remained in effect, making a total bond at that point of $500,000. Grisoni maintained that the bond in effect at that time was "wholly inadequate."
On June 8, 1999, the appellate court entered an order on Wright's petition for rehearing on its denial of Wright's motion for interlocutory appeal. Since Grisoni's response to the petition had not addressed the issue of damages, the appellate court ordered Grisoni to show cause on whether Grisoni had filed any pleadings with the trial court requesting damages. The June 8 order stated that further proceedings in the trial court were stayed until further order of the appellate court.
On the same date, June 8, 1999, the trial court held a hearing on Grisoni's motion to increase the injunction bond. Without knowledge of the order of the appellate court staying further proceedings, the trial court entered an order requiring Wright to post an additional $1.9 million bond, making a total bond of $2.4 million. The trial court's order stated that the additional bond had to "be posted on or before June 18, 1999, otherwise, the injunction presently in effect, whose dissolution was stayed by the Court of Appeals, is dissolved."
In light of its earlier order staying proceedings in the trial court, on June 17, 1999, the appellate court entered an order vacating the trial court's June 8 order increasing the injunction bond to $2.4 million, *577 finding that the $500,000 bond in effect at that time was "sufficient for present purposes." The appellate court denied Wright's petition to rehear. It noted that the parties agreed that the only remaining issue was damages,[13] and concluded that it was best for the case to proceed to final judgment rather than hearing an interlocutory appeal. The appellate court remanded the case to the trial court and ordered that the injunction against Grisoni should remain in effect. Grisoni then sought permission from the Tennessee Supreme Court for an interlocutory appeal of the Court of Appeals' order setting the injunction bond at its previous level of $500,000. Grisoni's petition with the Tennessee Supreme Court was denied. The injunction bond remained at $500,000 until the conclusion of the trial court's proceedings on the issue of damages.
The hearing on damages commenced on March 6, 2000. Grisoni sought damages under Rule 65 of the Tennessee Rules of Civil Procedure on the theory that the injunction was wrongfully issued, as well as damages for malicious prosecution, damages under the Tennessee penalty statute for wrongful injunctions, Tennessee Code Annotated § 29-23-104, and damages for Wright's alleged misappropriation of Grisoni's proprietary information to develop another product called Allomatrix. Grisoni also sought punitive damages and attorney's fees.
At the hearing on damages, Grisoni testified regarding his sales projections for ProFusion, as well as his expected costs and profit margin. Grisoni also presented the testimony of an economic expert, Robert Bush. Bush calculated that potentially Grisoni could have achieved approximately 10 percent of an estimated $500 million to $750 million total annual market for bone filler products. For the period during which the injunction was in place, taking into account the amount of product Grisoni could have produced, Bush estimated that Grisoni could have realized on approximately 10 percent of his sales potential or, roughly, $5.3 million per year.[14]
Grisoni again testified on his assertion that Wright officials accessed the information in his lab notebook during the time in which Grisoni worked as a consultant for Wright. In his testimony, Grisoni said that the fact that his prototype for ProFusion was developed on September 8, 1997 was noted in his lab notebook. Grisoni maintained that the only place this date appeared was in his lab notebook. He had not discussed this date with anyone at Wright. Nevertheless, in its original complaint, Wright alleged that Grisoni developed his prototype "by" September 8. Grisoni alleged that, during the time he was consulting for Wright in October 1997, Haggard accessed Grisoni's briefcase without Grisoni's permission, read through the lab notebook and, thereby, learned the date the prototype was developed.
In support of his claim for malicious prosecution, Grisoni proffered the testimony of Larry Houk, Ph.D., a chemistry professor for nearly 30 years, employed at the time of trial at the University of Memphis. The substance of Houk's testimony was that anyone with a chemistry background would have been able to produce ProFusion using only publicly available information. Houk asserted that this fact would *578 have been obvious to Wright at the time that Wright allegedly reviewed Grisoni's lab notebook.
Grisoni sought compensatory damages for malicious prosecution as well as punitive damages. In response to the allegation of malicious prosecution, Wright offered the testimony of Wright officials and attorneys concerning the reasons why they believed that seeking an injunction was appropriate. Patton testified that he first observed Grisoni's ProFusion product at the annual meeting of the American Academy of Orthopedic Surgeons. The similarities in the two products and the fact that Grisoni was able to develop ProFusion in such a short time convinced Patton that Grisoni had likely used Wright's confidential information to develop ProFusion. Afterward, Patton asked Wright's general counsel, Mike McLaren, to investigate the matter. McLaren testified that he interviewed Haggard and Churinetz and reviewed the work in which Grisoni was involved while employed at Wright, as well as the confidentiality agreements Grisoni had signed. McLaren said that he was familiar with the legal requirements to obtain injunctive relief and felt at the time that injunctive relief was warranted.
Grisoni also sought damages for the alleged misappropriation of information from his lab notebook. Grisoni testified that, in early 1998, he began researching a calcium sulfate putty which contained substances to promote bone growth. Grisoni recorded his research on the calcium sulfate putty in his lab notebook. The lab notebook was later turned over to Wright in April 1998 as part of discovery into Grisoni's development of ProFusion. Grisoni testified that lab notes obtained during discovery from Don Peterson, the engineer in charge of developing of Wright's calcium sulfate based putty, called Allomatrix, indicated that Peterson had used test data described in Grisoni's lab notebook. From this, Grisoni argued that Wright had misappropriated proprietary information from Grisoni's notebook and that Grisoni should therefore recover any profits Wright realized on Allomatrix.
After the damages hearing, the trial judge issued lengthy written findings of fact and conclusions of law. In its findings of facts and conclusions of law, the trial court made specific credibility determinations, weighing heavily in favor of Grisoni. The trial court found Grisoni to be a "very credible witness" and found support for his testimony in other evidence in the record. In contrast, the trial court found the testimony of several of Wright's witnesses, particularly Dr. Haggard and attorney Haltom, to be untruthful and unsupported by other evidence. Specifically, the trial court found that Wright witnesses testified untruthfully regarding the source of the date alleged in the complaint as the date by which Grisoni had developed his ProFusion prototype. The trial court concluded that Wright must have learned this date from an unauthorized inspection of Grisoni's lab notebook during the period in which Grisoni was a consultant for Wright, in October 1997. The trial court also concluded, relying on Dr. Houk's testimony, that Wright knew or should have known, after its unauthorized review of Grisoni's lab notebook, that ProFusion was not developed by the use of any confidential information. Despite this, the trial court noted, Wright consistently sought injunctive relief against Grisoni and refused any offers by Grisoni to show that he had not used confidential information.
The trial court also reviewed at length the testimony of attorney William Haltom regarding his statements to Grisoni in the course of the settlement conference that Grisoni secretly recorded. The trial judge concluded that Haltom testified untruthfully *579 that he did not tell Grisoni or his attorney at that time, Steve Biller, that he would "go to the FDA" if Grisoni refused to surrender his 510(k) on ProFusion. The trial court noted that Wright refused to consider Grisoni's overtures to demonstrate that he had not used confidential information and instead, through attorney Haltom, threatened Grisoni with criminal prosecution for perjury if he refused to surrender his 510(k) on ProFusion. From these facts the trial court concluded that Wright acted without probable cause, and that Wright's motivation in filing suit against Grisoni was to keep Grisoni out of the calcium sulfate bone void filler market, rather than any belief that Grisoni had developed ProFusion through the use of confidential information.
The trial court concluded that Grisoni had been wrongfully enjoined from participating in the bone void filler market for two years. As a result, the trial court found, Grisoni had suffered significant damages in the form of lost profits from sales of ProFusion and lost opportunities in developing new calcium sulfate products. It noted that, in Tennessee, damages from an injunction that has been wrongfully issued are limited to the amount of the injunction bond, unless there is a finding of malicious prosecution. Based on its finding that Wright was liable for malicious prosecution, the trial court found that Grisoni's damages were not limited by the amount of the injunction bond. It found that the amount of damages sustained by Grisoni, while not mathematically certain, could reasonably be assessed. Considering the proof at the hearing, the trial court awarded Grisoni and Biogeneration $4.79 million in compensatory damages and an additional $408,000 per month for the next twelve months or until the final resolution of the case, whichever occurred first. The trial court declined to award damages on Grisoni's claim that Wright developed Allomatrix by utilizing wrongfully obtained material from Grisoni's lab notebook. The trial court found that "although there is a strong inference to support Defendants' contention [that Wright misappropriated material from the lab notebook], this court cannot say, by a preponderance of the evidence, that Wright's Allomatrix putty is the product of Grisoni's research and lab book information." On Grisoni's claim for punitive damages, the trial court found that Wright had acted with malice in instituting the injunction proceeding and awarded Grisoni punitive damages in the amount of $4.79 million. The final judgment was issued on May 10, 2000. On May 26, 2000, Wright filed its notice of appeal.
On May 30, 2000, Grisoni filed a motion with the trial court seeking an order requiring Wright and Travelers to post an appeal bond in the amount of $18 million. On that same day the trial court conducted a hearing to determine Wright's application for a stay of execution. The trial court granted a stay but ordered that Wright post a stay bond for $9.7 million. However, if Wright agreed to file with the Court of Appeals a consent order dissolving the temporary injunction, the bond would be reduced to $5 million. On June 21, 2000 the $5 million bond was posted and five days later the consent order was entered permitting Grisoni to begin producing and marketing ProFusion. On July 6, 2000, the trial court conducted a hearing to determine Travelers' liability on the injunction bond. The injunction bond provides:
That the undersigned, Wright Medical Technology, Inc., as PRINCIPAL and TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, as SURETY, are held and firmly bound unto Bernard F. Grisoni and Biogeneration, Inc., in the sum of Seven Thousand, *580 Five Hundred and no/100 Dollars ($7,500.00) [later amended by rider to $250,000] for the payment of which well and truly to be made, we bind ourselves firmly by these presents:
The condition of this bond is such that, whereas, WRIGHT MEDICAL TECHNOLOGY, INC., has sought and obtained a Temporary Restraining Order in this cause; now, if said Principal or Surety pays all damages and costs which any person may sustain by the suing out of such Temporary Restraining Order if the same is dissolved, this obligation to be void; otherwise, to remain in full force and effect.
Grisoni argued to the trial court that the terms of the Travelers' bond can be interpreted in two different ways. Grisoni admitted that the first paragraph limits Travelers' liability to the penal sum, $250,000. However, Grisoni argued that the second paragraph subjected Travelers to liability for the entire judgment in excess of $9 million. Grisoni asserted that the clause "if said Principal or Surety pays all damages and costs" creates an obligation for Travelers to pay all damages and costs. Because Travelers drafted the instrument, Grisoni maintained, the second interpretation should prevail. The trial court rejected Grisoni's argument and fixed Travelers' liability at $250,000.
ISSUES ON APPEAL
In this appeal, Wright, Grisoni and Travelers all raise issues to be considered by this Court. In addition, attorney Haltom, while not a party, filed an amicus brief in this appeal. The issues raised by all parties are outlined below.
On appeal, Wright contends that the evidence preponderates against the trial court's ruling that Grisoni did not use confidential information to develop ProFusion and obtain FDA approval and, consequently, erred in dissolving the injunction. In the alternative, even if the injunction was improperly issued, Wright argues that Grisoni is estopped from recovering damages resulting from the injunction because he consented to it. Further, Wright asserts that the evidence shows that Wright had probable cause to institute the lawsuit and acted without malice, and consequently, the trial court erred in finding liability for malicious prosecution. Wright also argues that the trial court erred in its award of compensatory damages because proof of the amount of Grisoni's damages was too speculative to support an award. Lastly, Wright argues that the evidence was insufficient to justify an award of punitive damages.
In response, Grisoni argues that the evidence establishes that his product, ProFusion, is considerably different than Wright's product, Osteoset. Grisoni contends that the evidence shows that he developed ProFusion and obtained FDA approval by using only information that was publicly available. Grisoni argues that the appellate court may reverse the trial court's order to dissolve the injunction only if it finds that the trial court abused its discretion in dissolving the injunction. In the alternative, even if the standard is preponderance of the evidence, Grisoni maintains that the trial court's decision to dissolve the injunction should be affirmed. On the trial court's decision to find Wright liable for malicious prosecution, Grisoni asserts that the evidence shows that Wright gained unauthorized access to Grisoni's lab notebook. In so doing, Grisoni contends, the evidence shows that Wright became aware that ProFusion was significantly different from Osteoset and that ProFusion was developed without the use of confidential information. Despite this, Grisoni argues, Wright sought and obtained injunctive relief and, therefore, should be held liable for malicious prosecution as well as *581 punitive damages. Grisoni asserts that Wright's improper review of his lab notebook constitutes "unclean hands" and bars Wright from seeking equitable relief. Grisoni argues that the award of compensatory damages was supported by evidence that was not too speculative to support such an award. In the alternative, Grisoni argues that even in the absence of malicious prosecution, he is entitled to recover a statutory penalty under Tennessee Code Annotated § 29-23-104(a). Punitive damages were supported, Grisoni argues, by the evidence of malice and unclean hands. Grisoni asserts that the trial court erred in declining to award him damages for Wright's use of material allegedly misappropriated from his lab notebook to develop Allomatrix. Lastly, Grisoni asserts that the trial court erred in limiting Travelers' liability under the bond to $250,000.
On appeal, Travelers asserts that the trial court correctly limited its liability to $250,000. Under the terms of the bond, Travelers argues, it is unambiguous that its liability is limited to the penal amount of the bond. Travelers also argues that its liability on the bond was discharged when the trial court failed to enter judgment against it and, alternatively, that the bond was discharged upon Wright's filing of an appeal bond.
Attorney Haltom filed an amicus brief on appeal asking this Court to review the trial court's finding that he did not testify truthfully regarding his statements in the settlement conference with Grisoni. Haltom argues that this Court can review the credibility determination made by the trial court since Haltom's trial testimony can be compared to the transcript of the tape recorded settlement conference.
ANALYSIS
In considering the issues raised on appeal, we analyze first the trial court's finding of liability for malicious prosecution. In connection with the award of damages for malicious prosecution, the award of punitive damages will be reviewed. Next we review the trial court's order dissolving the temporary injunction and its finding that Grisoni did not use confidential information in developing ProFusion. In connection with this, we address Wright's contention that Grisoni cannot obtain compensatory damages for wrongful issuance of the injunction because he consented to it, as well as the award of damages for wrongful issuance of the injunction. The remaining issues on appeal will then be discussed.
MALICIOUS PROSECUTION AND PUNITIVE DAMAGES
The elements of a cause of action for malicious prosecution are well settled. They are: (1) a judicial proceeding that has been instituted by the defendant and finally resolved in the favor of the claimant; (2) the defendant instituted the proceeding without probable cause; and (3) the defendant acted with malice. Roberts v. Federal Express Corp., 842 S.W.2d 246, 247-248 (Tenn.1992). The claimant bears a heavy burden of proof in establishing the element of lack of probable cause and the element of malice. Kauffman v. A.H. Robins Co., Inc., 223 Tenn. 515, 448 S.W.2d 400, 404 (1969). Probable cause exists where the original plaintiff possessed a reasonable belief in both the existence of facts supporting his claim and that those facts made out a legally valid claim. Buda v. Cassel Bros., Inc., 568 S.W.2d 628, 631-632 (Tenn.Ct.App.1978). The reasonableness of the defendant's belief and conduct is a factual determination. Roberts, 842 S.W.2d at 248-249 (overruling earlier cases holding that whether probable cause existed at the time the proceeding was instituted is a legal determination). The *582 plaintiff may rely on the advice of counsel as to the validity of the claim where the advice is sought in good faith and is given after fair and complete disclosure of all relevant facts in his possession and all facts he could have ascertained by reasonable diligence. Kelley v. Tomlinson, 46 S.W.3d 742, 748 (Tenn.Ct.App.2000). As to malice, the claimant need not prove ill will or personal hatred, so long as he demonstrates an improper motive. Lawson v. Wilkinson, 60 Tenn.App. 406, 447 S.W.2d 369, 374 (1969). While malice may be inferred from a total absence of probable cause, no amount or kind of malice is sufficient to establish lack of probable cause. Nashville Union Stockyards, Inc. v. Grissim, 13 Tenn.App. 115, 126-127, 1930 WL 1751 (Tenn.Ct.App.1930).
In this case, the trial court found Wright liable for malicious prosecution and awarded Grisoni compensatory damages on this claim. Compensatory damages were awarded to Grisoni in the amount of $4.79 million for the period of April 3, 1998 through April 2, 2000, and $408,000 per month thereafter until resolution of the lawsuit.
The trial court's finding of malicious prosecution was based on its factual finding that Wright officials improperly gained access to Grisoni's lab notebook while Grisoni worked as a consultant for Wright. From this finding, the trial court inferred that Wright knew the entire content of Grisoni's lab notebook prior to filing suit. The trial court credited testimony to the effect that anyone looking at Grisoni's lab notebook would know that ProFusion was developed without the use of confidential information, and from this concluded that Wright instituted the lawsuit against Grisoni without probable cause. The trial court's finding of malicious prosecution was also premised on its conclusion that Wright's attorneys were untruthful and threatening to Grisoni, for the sole purpose of preventing Grisoni from introducing into the market a product to compete with Osteoset. The trial court's factual findings were based in part on its determination of the credibility of the witnesses for both parties.
When the resolution of the issues in a case depends upon the truthfulness of witnesses, the trial judge who has the opportunity to observe the witnesses in their manner and demeanor while testifying is in a far better position than this Court to decide those issues. McCaleb v. Saturn Corp., 910 S.W.2d 412, 415 (Tenn.1995); Whitaker v. Whitaker, 957 S.W.2d 834, 837 (Tenn.Ct.App.1997). The weight, faith, and credit to be given to any witness's testimony lies in the first instance with the trier of fact, and the credibility accorded will be given great weight by the appellate court. Id.; Estate of Walton v. Young, 950 S.W.2d 956, 959 (Tenn.1997). Where there is conflict in the testimony that requires a determination of the credibility of a witness, the trial court's finding is binding on the appellate court "unless from other real evidence the appellate court is compelled to conclude to the contrary." Hudson v. Capps, 651 S.W.2d 243, 246 (Tenn.Ct.App.1983) (citing State ex rel Balsinger v. Town of Madisonville, 222 Tenn. 272, 435 S.W.2d 803, 807 (1968)).
On appeal, Wright argues that the trial court erred in finding that Wright improperly gained access to Grisoni's lab notebook while Grisoni worked at Wright as a consultant. The trial court's finding is based on Wright's allegation in the complaint that Grisoni had developed his prototype of ProFusion "by" September 8, 1997. Grisoni testified that he had told no one that he developed the ProFusion prototype on September 8, that the only document containing the date was Grisoni's lab notebook, and that the lab notebook was *583 not disclosed to Wright until discovery commenced, well after Wright's complaint was filed. Grisoni testified that, while he worked as a consultant for Wright, he often left his lab notebook unattended on his desk, located near Haggard's office. While Haggard denied accessing Grisoni's lab notebook, the trial judge found that Haggard was not a credible witness. The trial court noted the statement by Wright's attorney, Steven Vescovo, that he knew where the September 8 date in the complaint came from, but that Grisoni's attorney could not ask him about it.
In a situation such as this, the trial court's assessment of the credibility of the witnesses is necessarily dependent on the trial judge's evaluation of the witnesses' demeanor and manner while testifying under these circumstances; the trial court's determination on the witnesses' credibility must be accorded great weight by the appellate court. See Estate of Walton, 950 S.W.2d at 959.
In this case, the trial court credited Grisoni's testimony that the only way anyone could have known the date on which the ProFusion prototype was developed was by looking at his lab notebook. The trial judge discredited Haggard's denial that he improperly accessed the lab notebook. From this the trial judge inferred that Wright officials improperly accessed Grisoni's lab notebook and, moreover, inferred that Wright officials thereby gained knowledge of everything in the lab notebook. While this is a far-reaching conclusion to infer, we find that it is a permissible inference. With due deference to the trial court's determination of credibility, we find that the evidence does not preponderate against this factual finding.
Next we examine the trial court's finding that Wright's attorney, William Haltom, was untruthful and improperly threatening to Grisoni. This is a unique credibility determination in which the issue is whether Haltom testified truthfully at trial regarding his recollection of what he said in settlement conference. Since Grisoni secretly taped the settlement conference, this is not just a swearing contest between Haltom and Grisoni. Rather, determining Haltom's credibility involves comparing his testimony at trial to the transcript of the settlement conference.
In the settlement conference, Haltom noted that Grisoni swore in the 510(k) application for the FDA that ProFusion is identical to Osteoset, but in his deposition Grisoni denied that ProFusion was identical to Osteoset. Haltom said in the settlement conference that one or the other is not the truth. Haltom told Grisoni and his attorney Steve Biller that Wright would pursue the lawsuit and would go back to the FDA and would give information on Grisoni's contradictory statements to both the FDA and the chancery court.
In the settlement conference, Grisoni's attorney Biller explained to Grisoni that, based on Grisoni's contradictory deposition testimony, Wright could go to the FDA and contest the validity of his 510K and Grisoni would "wind up with zero." Haltom said "it's a little more serious than that" and that "there's obvious implications for making false statements to the FDA...," and promised to pursue those remedies unless Grisoni agreed to surrender his 510K and make the injunction permanent.
In Haltom's testimony at trial, Haltom was asked by Grisoni's attorney what was discussed at the meeting. Haltom described the contradiction between Grisoni's sworn statement to the FDA and his deposition testimony, said that he told Grisoni and Biller that Wright wanted Grisoni to surrender his 510(k), testified that he asserted that Wright would pursue its civil *584 remedy in court, and stated that Wright had "an absolute right to go back to the FDA and point out his sworn testimony under oath which establishes a direct contradiction to everything he submitted to the FDA."
Haltom was asked repeatedly whether he told Grisoni that if he did not surrender his 510(k), Haltom would notify the FDA. Haltom replied "no" and then explained that he told Grisoni that, as a lawyer, he had an obligation to pursue a civil remedy, including "going back to the FDA and saying you issued a 510(k), and according to the man you issued the 510(k) to, what he told you in this document he now says under sworn testimony isn't true."
In heated exchanges between Haltom and Grisoni's attorney at trial, Steve Markowitz, Haltom was also asked if he told Grisoni that the implications for making false statements were clear. Haltom said that he did not recall using those words, denied threatening Grisoni with criminal prosecution, denied unethical conduct, said he had no idea what the implications were for making false statements to the FDA, and said that he never threatened Grisoni with anything other than pursuing a lawful civil remedy.
In its findings on credibility, the trial court characterized the testimony of Wright's witnesses, naming Haltom specifically, as "either untruthful, inaccurate or strained credibility...." In discussing his conclusion that Haltom was not truthful, the trial court stated:
47. On June 3, 1998, a settlement conference was held at the Thomas [sic] Hendrix law firm office with Dr. Grisoni, Attorney Biller, and Attorney William Haltom, Jr. Unbeknowing to all the attorneys, Dr. Grisoni secretly recorded the entire conversations at the meeting.
48. In the recorded tape of the meeting, Attorney Haltom made it very clear that Wright was concerned about Dr. Grisoni and Biogeneration's entry into the calcium sulfate bone void filler market, by securing FDA approval. Attorney Haltom specifically stated that "this matter (lawsuit) can be brought to an end if Dr. Grisoni will surrender [to Wright] his 510(k)" approval from the FDA and consent to making the temporary injunction permanent.
49. Attorney Haltom specifically told Dr. Grisoni that "you've got to agree to a permanent injunction, and part of that would be surrendering the 510(k), but that would be the most crucial."
50. In a further effort to persuade Dr. Grisoni to give in to Wright's demands, Attorney Haltom made the following statement:
a. "We're prepared, starting tomorrow to go forward with a least a two-part war in this casethe court of FDA and the Shelby County Chancery Court."
b. "... there's obvious implications for making false statements to the FDA...."
c. "Dr. Grisoni either didn't tell the truth to the FDA or he hasn't told the truth to the chancellor (per his deposition) ... we're prepared to give that information to both the FDA and to the chancellor...."
51. Attorney William Haltom, Jr. was not truthful when he testified under oath at trial, on behalf of Wright, that he never told Mr. Biller or Dr. Grisoni that he would go to the FDA if Dr. Grisoni did not surrender the 510(k).
52. Notwithstanding the clarity of the threat to Dr. Grisoni at the June 3rd meeting, as contained on the recorded tape and transcript, Attorney Haltom at trial testified that Attorney Biller never indicated to him that he felt like he was *585 threatening Dr. Grisoni with criminal action (for perjury). He said that:
To the contrary, [Attorney Biller] and I have talked since this, and he said that there was no threat ever made, [and] that he's willing to support me on this.
Findings of Fact and Conclusions of Law (References to trial exhibits deleted).
This credibility determination presents a unique situation. In contrast to the trial court's determination of the witnesses' credibility regarding the alleged improper access to Grisoni's lab notebook, the questions to Haltom centered on his recollection of statements made at the settlement conference, and the truthfulness of his testimony can be ascertained from a comparison of his testimony to the tape of the settlement conference. In comparing the two, it is clear that Haltom's testimony overall is consistent with what was said during the settlement conference. When asked if he told Grisoni that, if he did not surrender his 510(k) that Wright would notify the FDA, Haltom's initial response was "no."[15] Immediately thereafter, however, and indeed repeatedly in his testimony, Haltom acknowledged telling Grisoni that Wright would go back to the FDA to point out the contradiction between his deposition testimony and his statements to the FDA. Thus, while the trial court made a factual finding that Haltom "was not truthful when he testified under oath at trial, on behalf of Wright, that he never told Mr. Biller or Dr. Grisoni that he would go to the FDA if Dr. Grisoni did not surrender his 510(k)," with due deference to the trial court's role in assessing credibility, we must conclude that this finding is clearly erroneous. See Hudson v. Capps, 651 S.W.2d 243, 246 (Tenn.Ct.App.1983) (holding that the trial court's determination of credibility is "binding on the appellate court unless from other real evidence the appellate court is compelled to conclude to the contrary"). See also Krick v. City of Lawrenceburg, 945 S.W.2d 709, 712 (Tenn.1997) (holding that where all the proof is by deposition, appellate court may draw its own conclusions about credibility).
Moreover, in support of the finding of malicious prosecution, the trial court relies on statements made during the settlement conference that, to settle the case, Grisoni must surrender his 510(k) on ProFusion; if not, Wright would wage a "two-part war" by pursuing the chancery court lawsuit and contacting the FDA. Citing Haltom's statements during the settlement conference that, if Grisoni did not surrender his 510(k), Wright would give the information on Grisoni's deposition testimony to the FDA and that "there's obvious implications for making false statements to the FDA...," the trial court characterized these statements as "threats." It concluded from all of this that Wright's "primary motivation" in filing the lawsuit was to deny Grisoni "entry into its formerly exclusive calcium sulfate bone void filler market" and, based on this, found Wright liable for malicious prosecution.
We must ascertain whether these statements, made during the course of a settlement attempt, can be the basis for a finding of malicious prosecution. In an unfair competition lawsuit such as this, it is axiomatic that the actions of the plaintiff, in filing the suit, are motivated by a desire to prevent the defendant from competing. Of course, this cannot be accomplished by filing a groundless lawsuit; however, the mere fact that the plaintiff desires to prevent the defendant from introducing into the market a competing product cannot be the basis for a finding of malicious prosecution. *586 This fact indicates neither malice nor lack of probable cause.
Likewise, the statements made during the settlement conference, that Wright would pursue the lawsuit and go to the FDA if Grisoni did not surrender his 510(k), cannot be the basis for a finding of malicious prosecution. The trial court characterized these assertions as "threats," and that is not inaccurate. However, this is the harsh reality of litigation. Provided the lawsuit was not groundless, Wright had the legal right to pursue the chancery court litigation and to use legal means to call into question the validity of Grisoni's 510(k) on ProFusion. The trial court emphasized, and Grisoni calls unethical,[16] Haltom's statement during the settlement conference that "there's obvious implications for making false statements to the FDA...." While a perjury prosecution might result from Wright contacting the FDA regarding Grisoni's contradictory deposition testimony, Wright had a reasonable legal basis for questioning the validity of Grisoni's 501(k), regardless of peripheral consequences to Grisoni. This is an ugly but unavoidable consequence of settlement negotiations; each side must try to convince the other that refusing to relent to its settlement demand will result in consequences that are worse than giving in to the settlement demand. Provided the lawsuit is not groundless, statements of this type in settlement negotiations cannot form the basis for a finding of malicious prosecution.
The finding of malicious prosecution must now be evaluated in light of the remaining evidence. As noted above, the trial court found, based on its credibility determinations, that Wright had knowledge of the entire contents of Grisoni's lab notebook on ProFusion prior to instituting this lawsuit. At the same time, however, there are a number of other facts of which Wright was aware at the time the lawsuit was instituted. It is undisputed that Wright had knowledge that Grisoni had developed a prototype of ProFusion within a month of leaving his employment with Wright, a process that had taken Wright over a year of trial-and-error experimentation with Osteoset.[17] Wright knew that Grisoni had represented to the FDA that ProFusion was "identical" to Osteoset. Assuming that Wright knew that ProFusion utilized the beta form of calcium sulphate, Wright knew that Grisoni had been privy to Wright's experimentation with both the alpha and beta forms while Osteoset was being developed. Wright knew that ProFusion was being marketed in a pellet form that was nearly identical to Osteoset. Wright knew that Grisoni had used a process and methodology in his 510(k) application with the FDA that had great similarities to the process used by Wright in its 510(k) for Osteoset, a process that had included over a year of experimentation and modification by Wright, including an initial rejection by the FDA. Wright had knowledge of all of these facts in light of this Court's decision in Hickory Specialties, in which *587 the Court held that, despite the fact that the processes in question were based on existing technology and potentially could have been developed by independent technology, the defendant former employee could be enjoined because he in fact used his knowledge of the confidential process obtained through his position with his former employer. Hickory Specialties, Inc. v. B & L Laboratories, Inc., 592 S.W.2d 583, 587 (Tenn.Ct.App.1979). Thus, Wright had reason for a good faith belief that Grisoni had developed ProFusion and applied for the 501(k) with the FDA by utilizing confidential information that he obtained during his employment with Wright. In light of Hickory Specialties, and the undisputed evidence, we must conclude that Wright had a reasonable basis for believing that it had a good chance of establishing grounds for its civil claim against Grisoni. See Buda v. Cassel Bros., Inc., 568 S.W.2d 628, 631-632 (Tenn.Ct.App.1978); Taylor v. Morris, No. 01A01-9804-CH-00211, 1999 WL 675138, at * 4 (Tenn.Ct.App. Sept.1, 1999).
Grisoni contends that Wright should be held liable for malicious prosecution for continuing the litigation as well. However, the trial court's conclusion that the temporary injunction was wrongfully issued hinges in large part on its credibility determination in Grisoni's favor. Grisoni testified essentially that he developed ProFusion by independent technology and not from using information he obtained while employed at Wright. Under Hickory Specialties, of course, even if the process could potentially be developed by independent technology, the employee could be held liable if he in fact used knowledge of the confidential process that he obtained while employed by the plaintiff employer. 592 S.W.2d at 587. Wright, of course, is not required to know in advance of the injunction hearing that the trial court would credit Grisoni's testimony that he developed ProFusion by independent technology and not through the use of knowledge he obtained while at Wright regarding the development of Osteoset. See ILG Indus., Inc. v. Scott, 49 Ill. 2d 88, 273 N.E.2d 393, 398 (1971) ("In many cases the question of whether a specific matter is a trade secret is an extremely close one, often not readily predictable until a court has announced its ruling."). Grisoni's assertions were highly disputed. Consequently, in its continuation of the litigation, up to the trial court's finding that the injunction should be dissolved, Wright still had a reasonable basis for believing that it had a good chance of establishing grounds for its civil claim against Grisoni. After that point, continuation of the injunction was simply to preserve the status quo pending appeal. Under these circumstances, we cannot conclude that the evidence establishes either malice or lack of probable cause for Wright's continuation of the litigation. Accordingly, the trial court's finding that Wright is liable for malicious prosecution must be reversed.
In light of this holding, we must review the trial court's award of punitive damages. The trial court awarded punitive damages in the amount of $4.79 million, after noting that punitive damages could be awarded only if Wright's conduct amounted to "fraud, malice, oppression, gross negligence or outrageous conduct," and citing Davenport v. Chrysler Credit Corp., 818 S.W.2d 23 (Tenn.Ct.App.1991). The standard for punitive damages was refined further in Hodges v. S.C. Toof & Co., 833 S.W.2d 896 (Tenn.1992). In Hodges, the Tennessee Supreme Court cautioned that punitive damages should be awarded only in cases involving "the most egregious of wrongs." Id. at 901. The Court emphasized that it sought to avoid "dull[ing] the potentially keen edge of the doctrine as an effective deterrent of truly *588 reprehensible conduct." Id. (quoting Tuttle v. Raymond, 494 A.2d 1353, 1361 (Me.1985)). It held that, in order to award punitive damages, the trial court must find "intentional, fraudulent, malicious or reckless conduct by clear and convincing evidence." Id.
In this case, we have reversed the finding of malicious prosecution, concluding that Wright had a reasonable belief that it had a good chance of establishing grounds for its civil claim against Grisoni. Under these circumstances, the award of punitive damages is not warranted and must be reversed.
WRONGFUL INJUNCTION
Wright also argues on appeal that the trial court erred in dissolving the injunction against Grisoni. Resolution of this issue turns on whether the evidence preponderates against the trial court's finding that the information Grisoni used in developing and obtaining regulatory approval for ProFusion was available through independent research of public sources. Wright argues that the evidence shows that ProFusion was the product of Grisoni's prior access to Wright's confidential sources and its trial-and-error experimentation.
An employee may, of course, enter into an agreement with his employer barring him from engaging in any competition with the employer. Heyer-Jordan & Assocs., Inc. v. Jordan, 801 S.W.2d 814, 821 (Tenn.Ct.App.1990). In the absence of such an agreement, once the employment relationship ends, the employee is free to develop and market products which compete with those of his former employer. Ed Nowogroski Ins., Inc. v. Rucker, 137 Wash.2d 427, 971 P.2d 936, 941 (1999). However, the employee is still bound by the general duty not to disclose confidential information or trade secrets belonging to the former employer; violation of this duty gives rise to a cause of action in the employer to obtain relief against the former employee. Id. at 941-942 (citing Restatement (Third) of Unfair Competition § 42 cmt. b (1995)).
In addition to any common law duties, Grisoni also executed a confidentiality agreement. Similar to the standard under the common law, the agreement prohibits Grisoni from using or disclosing any of Wright's trade secrets or confidential information, but does not apply to "any information which has become publicly available through no fault of" Grisoni. The agreement, of course, must be interpreted by reference to common law principles. Dynamics Research Corp. v. Analytic Sciences Corp., 9 Mass.App.Ct. 254, 400 N.E.2d 1274, 1288 (1980) (finding that a "nondisclosure agreement only affirmed the intent of the parties to be bound by the common law of trade secrets").
The burden of proof in a lawsuit to protect employer trade secrets was discussed in Hickory Specialties, Inc. v. B & L Laboratories, Inc., 592 S.W.2d at 586 (citing Smith v. Dravo Corp., 203 F.2d 369 (7th Cir.1953)). In such a lawsuit, the employer has the burden of proving that trade secrets were communicated to the employee in the course of a confidential employment relationship and that the employee is attempting to use those secrets to the detriment of the employer. Id. A trade secret is "any formula, process, pattern, device or compilation of information that is used in one's business and which gives him an opportunity to obtain an advantage over competitors who do not use it." Id. (quoting Allis-Chalmers Mfg. Co. v. Continental Aviation & Eng. Corp., 255 F. Supp. 645, 653 (E.D.Mich.1966)). Confidential information is closely analogous to a trade secret and warrants similar protection. See Vantage Technology, LLC, v. *589 Cross, 17 S.W.3d 637, 645 (Tenn.Ct.App.1999); Heyer-Jordan, 801 S.W.2d at 821. Several factors to consider in determining whether a piece of information constitutes a trade secret are:
(1) the extent to which the information is known outside of the business;
(2) the extent to which it is known by employees and others involved in the business;
(3) the extent of measures taken by the business to guard the secrecy of the information;
(4) the value of the information to the business and to its competitors;
(5) the amount of money or effort expended by the business in developing the information;
(6) the ease or difficulty with which the information could be properly acquired or duplicated by others;
Venture Express, Inc. v. Zilly, 973 S.W.2d 602, 606 (Tenn.Ct.App.1998). Thus, the extent to which the information has become available outside the confidential relationship is significant. To constitute a trade secret, it must be difficult for anyone outside the confidential relationship to acquire the information by proper means. Hickory Specialties, 592 S.W.2d at 587. Information which has become readily available through public sources or is generally well known in the industry cannot be considered confidential. Id. However, information which was acquired by the defendant through the confidential relationship may be protected even if the information potentially could have been obtained through independent research. Id. This is particularly true where acquisition of the information through independent research would be difficult, costly, or time consuming. Essex Group, Inc. v. Southwire Co., 269 Ga. 553, 501 S.E.2d 501, 504 (1998). In Hickory Specialties, the Court observed, "[t]he potential to develop the process by independent technology, affords the [former employee] no excuse to obtain the process through a confidential employer-employee relationship and then compete with the developer [of the process.]." 592 S.W.2d at 587. Thus, even if the process could have been developed by independent technology, it may be protectible if the former employee does not develop it by independent technology but in fact obtains his knowledge of the process from his former employer and then uses this knowledge to compete with the former employer.
Moreover, even if individual pieces of information may be publicly known, the integration of the information into a unified process may be confidential or a trade secret:
"The fact that some or all of the components of the trade secret are well-known does not preclude protection for a secret combination, compilation, or integration of the individual elements." Restatement of the Law 3d, Unfair Competition (1995), § 39(f), p. 432. Hence courts have recognized that "a trade secret can exist in a combination of characteristics and components, each of which, by itself, is in the public domain, but the unified process, design and operation of which in unique combination, affords a competitive advantage and is a protectible secret."
Essex Group, 501 S.E.2d at 503 (quoting Water Services, Inc. v. Tesco Chemicals, Inc., 410 F.2d 163, 173 (5th Cir.1969)). Thus, even if portions of the information used are in the public domain, the integration of the information into a process not commonly known may be protectible.
However, while a former employee cannot use confidential business information, he is entitled to use the general knowledge, skill and experience he acquired *590 over the course of his employment. See Dynamics Research, 400 N.E.2d at 1282. The former employee "cannot be compelled to erase from his mind all of the general skills, knowledge and experience acquired through his experience." ILG Indus., Inc. v. Scott, 49 Ill. 2d 88, 273 N.E.2d 393, 396 (1971). The employer's burden is greater where the employee brings to the job extensive experience, "for the loss to the individual and the economic loss to society are both greatest when a highly trained and specialized person is prevented from employing his special abilities." Dynamics Research, 400 N.E.2d at 1282-83 (quoting Blake, Employee Agreements Not to Compete, 73 Harv. L.Rev. 625, 684-85 (1960)). It can be difficult to draw the line between confidential business information, which cannot be used, and the former employee's general knowledge, skill and experience, which can used. In Essex Group the employer Southwire developed a logistics system in the cable and wire industry. 501 S.E.2d at 502. Southwire's logistics system was developed over a lengthy time period at considerable expense, in a project headed by the defendant former employee, McMichael. Id. McMichael left Southwire and began working for a direct competitor, Essex, in its logistics department developing a logistics system for Essex. Id. To determine whether the information Southwire sought to protect was part of McMichael's general knowledge, skill and experience, the court looked at whether the information would be of value to McMichael if he were not employed by a direct competitor of his former employer:
The specific information McMichael possessed would not have availed another company that was not a direct competitor of Southwire. In other words, McMichael brought to Essex not only the general information acquired in his job, i.e., that a certain logistical factor such as the positioning of storage containers would need to be resolved before certain other factors were decided: [sic] McMichael also brought specific information, such as how, where, and when those storage containers had to be positioned so as to accommodate most efficiently the very same product Essex was producing in competition with Southwire.
Id. at 504. The Essex court offered an example:
For example, had McMichael taken a position overseeing the logistics system startup at a company that manufactured a totally different product, like pet goods or kitchen wares, he could be said to be utilizing his general knowledge regarding the manner in which a logistics system should be designed, since there would be no practical application for the specific, protected information he obtained while working at Southwire about the precise design that maximizes a logistics system for a cable and wire business.
Id. at 504, n. 3. Thus, where the information is specific and confidential and would be useful primarily to a direct competitor of the former employer, it is likely not part of the former employee's general skill, knowledge and experience and is protectible.
Grisoni argues that the parties are governed by the confidentiality agreement executed by Grisoni, rather than the common law. The provisions of the confidentiality agreement are broad; the agreement provides,
I will not disclose to anyone or use either during or after my employment, except with the prior written consent of Wright Medical Technology, any trade secret, confidential know-how or confidential business or technical information *591 of Wright Medical Technology. The foregoing obligation shall also apply to any trade secrets or other confidential information of any third party learned by me as a Wright Medical Technology employee and which Wright Medical Technology has an obligation to maintain in secrecy.
Therefore, it covers trade secrets, "confidential knowhow," and confidential business and technical information, as well as confidential information learned from a third party during Grisoni's employment. It excludes information which has become publicly available. Thus, the provisions of the confidentiality agreement are not appreciably different from the common law. See Dynamics Research Corp., 400 N.E.2d at 1288 (finding that "non-disclosure agreement only affirmed the intent of the parties to be bound by the common law of trade secrets"). We must view the issue of whether information has become "publicly available" from a common sense standpoint, against the backdrop of the common law discussed above.
The facts in this case must now be evaluated in light of these legal standards. In this case, Wright emphasized that it viewed the overall process of developing and obtaining FDA approval for Osteoset as confidential, not simply the individual items of information which were integrated into the process. See Restatement (Third) of Unfair Competition § 39 cmt. f (1995) (quoted in Essex Group, 501 S.E.2d at 503). Haggard emphasized this in his testimony before the trial court below:
Q. Let me stop you for a second. Is there anything in your last statement that we started from the 31 parts that you consider to be proprietary, confidential, or a trade secret, and if so, what?
A. Again, sir, we consider this process to be proprietary.
Q. Eachgo backthen each part of it.
A. No. We consider the process to be proprietary
Q. I want you to tell me each part of it.
Later, Haggard testified:
Q. Is that step proprietary, confidential, or a trade secret?
A. And as I was trying to answer before I was interrupted, we consider the procedure for making the pellets to be proprietary. Within that procedure, there may be certain elements that are not proprietary, that are common knowledge, but when you put them all together to make the overall procedure to make the pellets, that is what becomes proprietary....
Again, in these individual steps, sifting itself is not proprietary. My mother sifts flour when she makes biscuits. I mean, we all know that. But doing the steps in this order and making sure that the material goes into the water first so it can completely wet out and mixing it for 60 seconds and not mixing and over-mixing it, that is where you get into some of the proprietary nature of this process.
The integration of all of this information into a process not commonly known can be protectible. Wright also asserts that there were numerous elements of information learned by Grisoni for which there was no public source. Broadly stated, these elements of information include the following:
1. Information Wright, and Grisoni, obtained from third parties such as U.S. Gypsum;
2. Studies, typically conducted by Grisoni, on the characteristics, dissolution rates, similarities and differences between alpha calcium sulfate and beta calcium sulfate, and the physical and *592 chemical properties of medical grade calcium sulfate;
3. Techniques for including antibiotics in bone void filler;
4. Details on the molding process for Osteoset and which materials and processes worked best;
5. Details on the process for making Osteoset, such as the "working time" for the compound, and the temperature and humidity levels at which the product was kept;
6. Details on the dissolution tests and other measures taken by Wright to get FDA approval for Osteoset;
7. The chemical specifications for Osteoset and its predicate device, Ethicon;
8. Information on the market for bone void fillers, and Wright's marketing techniques and strategies.
Some of this information could potentially fall within the purview of Grisoni's general skill, knowledge and experience, but most would not. Grisoni came to Wright highly educated and with extensive experience. See Dynamics Research Corp., 400 N.E.2d at 1282. For example, Grisoni had considerable experience in silicon molding prior to coming to Wright. However, it is undisputed that, prior to joining Wright, Grisoni had no experience working with calcium sulfate. All of his experience in calcium sulfate production came at Wright's expense during Grisoni's employment. Indeed, much of the information Wright seeks to protect is of the type that could be deemed confidential information. While various elements are commonly known, Wright integrated these elements into a process that could be deemed protectible. See Restatement (Third) of Unfair Competition § 39 cmt. f (1995). It is undisputed that Wright invested substantial time, effort and money into developing Osteoset and obtaining FDA approval for it, and that its efforts included considerable trial and error. The information Grisoni learned about bone void fillers would be of use primarily to direct competitors of Wright, and would be only of marginal value to a business that manufactured a different product. See Essex Group, 501 S.E.2d at 504. Moreover, there is evidence that Wright kept the information confidential. For instance, all Wright employees are required to sign confidentiality agreements, and files relating to the development of products, including 510(k)s, are marked confidential and usually kept under lock and key.
Yet, as to the majority of the information Wright seeks to protect, Grisoni presented testimony indicating Wright was not entitled to protection. For example, Grisoni was able to produce a number of public sources describing the general use and production of calcium sulfate bone void filler products. Wright's own technical monograph stated that "clinical use of calcium sulfate as a bone substitute for dental and orthopedic applications has been reported in literature for more than a century." Further, by the time Grisoni was terminated, Wright had published a number of brochures and user guides describing its new device and had submitted several press releases to Memphis newspapers describing the virtues of their product and the ever expanding market for bone graft substitutes. See ILG Indus., 273 N.E.2d at 396 ("[S]omething which is fully and completely disclosed by a business through its catalogs or literature disseminated throughout an industry cannot be a trade secret.").
Grisoni also presented testimony that, in many respects, ProFusion is significantly different from Osteoset, and that the manufacturing of ProFusion does not require Grisoni to use confidential information. The manufacture of Osteoset involves an elaborate process involving highly specialized *593 equipment and large scale production methods. In contrast, Grisoni manufactures ProFusion on a much smaller scale, often utilizing standard kitchen utensils and raw materials purchased over-the-counter. While each production method starts out with the powdered form of calcium sulfate dihydrate, Grisoni produces the beta-type hemihydrate by simply heating the dihydrate in a household oven, while Wright produces the alpha-type hemihydrate using specialized heating and pressurizing equipment. Wright asserts that Grisoni learned confidential information on including antibiotics in bone void filler because Osteoset was initially loaded with antibiotics. However, there is no indication that Grisoni included antibiotics in ProFusion. As to other phases of the manufacturing process, Grisoni presented evidence either that the process was widely known, such as using gamma radiation for sterilization, or that Grisoni gained knowledge of the process in his employment prior to Wright, such as the molding processes.
In other respects, Grisoni testified that he developed ProFusion and applied for FDA approval by conducting independent research after leaving his employment with Wright. Given the fact that Grisoni developed his prototype for ProFusion within a month after leaving Wright and filed the 510(k) on ProFusion within a short time thereafter, this testimony seems dubious. However, there is no documentary or other evidence indicating that the trial court erred in determining that Grisoni's testimony was truthful. Unless there is other real evidence which compels a contrary conclusion, the credibility determination of the trial court is binding on the appellate court. See Hudson v. Capps, 651 S.W.2d 243, 246 (Tenn.Ct.App.1983).
Moreover, Grisoni notes persuasively that Wright's advantage in developing a calcium sulfate bone void filler product did not come primarily from a secret design or manufacturing technique; rather, Wright's advantage came from its ability to obtain FDA clearance. Wright's ingenuity in acquiring Ethicon pellets and using Ethicon as its predicate device gave it an advantage over its competitors, at least for a time. However, evidence was presented that once Osteoset was approved by the FDA, it was only a matter of time before other producers of orthopedic devices used Osteoset as a predicate device to obtain FDA approval for their products.[18] A trade secret does not exist simply because a producer has no competitors or even because it has produced a novel product. See Koehring Co. v. E.D. Etnyre & Co., 254 F. Supp. 334, 339 (N.D.Ill.1966). The producer's advantage must come from some design or process which remains generally unknown in the industry. Id.
In addition, while Grisoni was aware of Wright's use of dissolution rate comparison in its 510(k) for Osteoset, Grisoni presented evidence that dissolution rate comparison was an obvious choice to demonstrate "substantial equivalency" with Osteoset since its relevant characteristic was that its dissolution rate was roughly equal to the rate of new bone growth. Therefore, if this evidence is credited, Grisoni's knowledge of Wright's dissolution testing offered him little advantage over other Wright competitors.
While the evidence overall presents a close question, giving due deference to the *594 trial judge's determinations of credibility, we must conclude that the evidence does not preponderate against the trial court's dissolution of the injunction. The decision of the trial court is affirmed on this issue.
DAMAGES
We must now consider the damages that Grisoni may recover for the wrongful issuance of the injunction. Rule 65.05(1) of the Tennessee Rules of Civil Procedure requires a party seeking a temporary injunction to provide indemnity "for the payment of such costs and damages as may be incurred or suffered by any person who is found to have been wrongfully restrained or enjoined." Tenn. R. Civ. P. 65.05.(1). The purpose of the rule is "to provide a mechanism for reimbursing an enjoined party for harm it suffers as a result of an improvidently issued injunction or restraining order." South Central Tenn. R.R. Auth. v. Harakas, 44 S.W.3d 912, 916 (Tenn.Ct.App.2000) (quoting Hoechst Diafoil Co. v. Nan Ya Plastics Corp., 174 F.3d 411, 421 (4th Cir.1999)). Injunction bonds have long been required under Tennessee law. Pyott Land & Mining Co. v. Tarwater, 126 Tenn. 601, 150 S.W. 539 (1912).
As noted by the trial court in its memorandum opinion, Tennessee adheres to what is sometimes called the "injunction bond rule." See Shanks v. Pyne, 180 Tenn. 708, 174 S.W.2d 461, 463 (1943); Taylor v. Morris, No. 01A01-9804-CH-00211, 1999 WL 675138 at * 3 (Tenn.Ct.App. Sept.1, 1999); 42 Am.Jur.2d Injunctions § 338. Under this rule, a wrongfully enjoined party's damages are limited to the amount of the injunction bond, in the absence of malicious prosecution. Shanks, 174 S.W.2d at 463; Taylor, 1999 WL 675138 at * 3; 42 Am.Jur.2d Injunctions § 338. The reasoning behind the rule is that the party seeking the injunction "consents" to potential liability, up to the amount of the bond, as the price paid for the injunction. See 42 Am.Jur.2d Injunction § 338.
In seeking damages under the injunction bond, the enjoined defendant need not show that the plaintiff acted with any degree of fault. South Central Tenn. R.R. Auth., 44 S.W.3d at 920; See also, Note, Interlocutory Injunctions and the Injunction Bond, 73 Harv. L.Rev. 333, 333 (1959) ("The American cases indicate that the purpose of the bond is to provide indemnity even when the plaintiff is not at fault."). The defendant need only show that he was wrongfully restrained or enjoined. Taylor, 1999 WL 675138 at * 3. "A party has been wrongfully enjoined within the meaning of [Rule 65.05] when it turns out the party enjoined had the right all along to do what it was enjoined from doing." South Central Tenn. R.R. Auth., 44 S.W.3d at 917 (quoting Nintendo of America v. Lewis Galoob Toys, 16 F.3d 1032, 1036 (9th Cir.1994)).
In this case, the finding of liability for malicious prosecution has been reversed. Consequently, Grisoni's damages for the wrongful injunction are limited by the amount of the injunction bond, i.e. $500,000.[19]
*595 Of course, in order to recover the full amount of the bond, Grisoni is required to show that he suffered damages from the injunction in an amount equal to or greater than the amount of the bond. Shanks, 174 S.W.2d at 463. In this case the trial court, having found Wright liable for malicious prosecution, awarded Grisoni damages well in excess of $500,000.
Wright argues that the proof of Grisoni's alleged damages was too speculative to support an award of compensatory damages. The award of compensatory damages is reviewed with the presumption that it is correct and will only be set aside if the evidence preponderates against it or the trial court used the wrong measure of damages. Beaty v. McGraw, 15 S.W.3d 819, 829 (Tenn.Ct.App.1998). The award of compensatory damages in this case was based on Grisoni's lost profits, an appropriate measure of damages. Moreover, while an award of compensatory damages must be based on reasonable certainty, it does not require mathematical certainty. Id. We find that the evidence supports an award of compensatory damages at least up to the amount of the injunction bond.
Wright also argues that Grisoni should not recover damages for the wrongful injunction because he did not oppose the entry of the temporary injunction order. Wright cites no Tennessee caselaw which directly supports this assertion, and this Court has not discovered any Tennessee cases on point. The case of Southern Ry. Co. v. Pardue, 123 Tenn. 376, 131 S.W. 862 (1910), appears to be most analogous. In that case, the defendant landowner was enjoined from building a house on land which was claimed by the plaintiff railroad to be part of its right of way. Id. at 862. In response to railroad's claim, the landowner filed a cross-claim seeking a judicial determination of the rights of the parties in the disputed property. Id. at 863. Later the injunction was dissolved and the landowner sought to recover on the injunction bond. The landowner testified that, after he heard of the railroad's claim, he wanted the matter settled before building on the property. Id. The trial court concluded that the landowner chose to forbear from building on the property, and would have done so regardless of the injunction. Id. Therefore, only nominal damages were awarded under the injunction bond. Id. The case simply stands for the proposition that the damages must be caused by the injunction, rather than a cause independent of the injunction. See South Central Tenn. R.R. Auth., 44 S.W.3d at 921 (discussing Southern Ry. Co. v. Pardue).
In this case, there is no evidence that Grisoni's failure to further develop and market ProFusion was the result of anything other than the wrongfully issued injunction. The evidence does not indicate that Grisoni would have chosen not to market ProFusion in the absence of the injunction. Indeed, although Grisoni did not oppose entry of the temporary injunction, in all of the pleadings in the record, he steadfastly maintained that he had used no confidential information and that the injunction was not warranted. Simply consenting to a temporary injunction, to enable the parties to maintain the status quo while the lawsuit is pending, should not preclude the enjoined party from seeking damages under the injunction bond for a wrongful injunction.
Grisoni argues that he should be able to recover a penalty under Tennessee Code Annotated § 29-23-104,[20] sometimes *596 referred to as the "penalty statute." Grisoni argues, without citing supporting authority, that such a penalty is appropriate where the enjoined party is unable to prove malicious prosecution. Further, Grisoni argues, the penalty is not limited by the amount of the injunction bond. Grisoni's argument is without merit. The statute is a mechanism for an award of a penalty in a situation in which the enjoined party's damages are too speculative to support an award of compensatory damages. Obviously, the trial court did not conclude that the evidence was too speculative to support an award of compensatory damages. The statute, therefore, has no application to the facts in this case.
Accordingly, we hold that Grisoni is entitled to recover as compensatory damages for the wrongful injunction the full amount of the injunction bond, $500,000. The trial court's award of compensatory damages is therefore modified to this amount.
SURETY LIABILITY
Grisoni argues on appeal that Travelers should be liable for the full judgment, rather than the amount of its bond, $250,000, based on alleged ambiguity in the terms of Travelers' bond. The first paragraph sets Travelers' liability under the bond at $250,000. The second paragraph then provides that, "if said Principal or Surety pays all damages and costs which any person may sustain by the suing out of such Temporary Restraining Order if the same is dissolved, this obligation to be void." (emphasis added). Grisoni argues that the use of the word "all" in the paragraph creates an obligation on the part of Travelers to pay the entire judgment. However, the use of the word "if" in the second paragraph creates a condition which, if met, discharges the obligation created in the first paragraph. Traveler's liability as a surety is, therefore, limited to $250,000.
Travelers asserts that the injunction bond has been discharged by the trial court's failure to enter a judgment against Travelers. Travelers also argues that the bond has been discharged by Wright's filing of an appeal bond. Travelers fails to offer any authority supporting these assertions. We find them without merit.
ALLOMATRIX
Grisoni appeals the trial court's decision to not award damages for Wright's alleged misappropriation of material from Grisoni's lab notebook. Grisoni produced his lab notebook to Wright as part of Wright's discovery into Grisoni's alleged use of confidential information. Along with information relating to Grisoni's development of ProFusion, the notebook also contained information on Grisoni's research into a calcium sulfate based putty. Grisoni testified that, within a few months of gaining access to his lab notebook, Wright was able to develop its own calcium sulfate putty product, Allomatrix, using several of the same development parameters described in Grisoni's lab notebook. Grisoni argues that this evidence preponderates in favor of finding that Wright used Grisoni's proprietary information in developing Allomatrix. Despite finding nearly all credibility determinations in Grisoni's favor, the trial judge nevertheless could not find that Wright had developed Allomatrix by using information from Grisoni's lab notebook. We hold that the preponderance of the evidence supports the trial court's holding.
*597 CONCLUSION
In sum, we affirm the trial court's factual finding that Wright improperly accessed Grisoni's lab notebook, reverse as clearly erroneous the trial court's finding on the credibility of Wright's attorney, William Haltom, and hold that the evidence is not sufficient to find either malice or lack of probable cause. Consequently, the finding of malicious prosecution is reversed. Because the evidence is insufficient to support a finding of malice, the award of punitive damages is likewise reversed. Deferring to the trial court's determinations on the credibility of the witnesses, we hold that the evidence does not preponderate against the trial court's order dissolving the injunction. The award of compensatory damages to Grisoni for the wrongful injunction must be limited by the amount of the injunction bond. Therefore, the award of compensatory damages is modified to the amount of the bond, $500,000. We hold that Travelers may be held liable for the amount of the bond it executed, $250,000. We affirm the trial court's holding that Wright is not liable for utilizing information allegedly misappropriated from Grisoni to develop Allomatrix. The remaining issues raised on appeal are pretermitted.
The decision of the trial court is affirmed in part, reversed in part and modified as set forth above. Costs are divided equally among the parties, appellant, Wright Medical Technology, Inc., and its surety, and the appellees, Bernard F. Grisoni and Biogeneration, Inc., and appellee, Travelers Casualty and Surety Company of America, for which execution may issue if necessary.
NOTES
[1] Subsequently, in March 1997, Wright received FDA clearance on the Osteoset plaster kit. However, the approved kit required the surgeon to first mold and dry the paste into small pellets before implantation. This device was approved using Osteoset pellets (approved in June 1996) and not Ethicon as the predicate device.
[2] Grisoni had conducted a dissolution test in 1995 comparing the dissolution rates of alpha-type hemihydrate and beta-type hemihydrate and concluded that the two had equivalent dissolution rates.
[3] Like the original confidentiality agreement, the consulting agreement provided an exception for information which was or became publicly available. While the agreement prohibited the use or disclosure of any confidential information, it acknowledged Grisoni's participation in developing a competing calcium sulfate bone void filler. The agreement provides "WMT hereby acknowledges and approves that you are currently and will continue to be engaged individually and with another corporation in the field."
[4] The letter provides that "confidential information would include the production process for creating the OSTEOSET® hemi-hydrate alpha crystals. Also confidential is such non-public information as the 510(k) for OSTEOSET, the company's regulatory strategy for OSTEOSET, the dissolution curve for each of the OSTEOSET products, how to attain such curves, the ability to vary the curves, the type and the source of the raw material for the original OSTEOSET, the difference and similarities between the original and subsequent OSTEOSET products, and the process for creating OSTEOSET...."
[5] Grisoni alleges that he did not agree to these additional terms in the modified TRO.
[6] Grisoni asserts that he did not agree to this language and did not even see the temporary injunction order until sometime in June.
[7] In September 1998, in response to these allegations Grisoni submitted a letter to the FDA explaining that he intended the term "identical" to mean "essentially alike" or "substantially equivalent."
[8] During the interim, Chancellor Small's bid for re-election was defeated and Chancellor Evans was elected.
[9] Rule 65.04(7) of the Tennessee Rules of Civil Procedure provides: "Before or after the commencement of the hearing of an application for a preliminary injunction, the Court may order the trial of the action on the merits to be advanced and consolidated with the hearing of the application."
[10] At the injunction hearing, Wright's counsel, Steve Vescovo, stated: "Do they want to know how we found out? I know, but he can't ask me. That's my business. Okay? But the fact of the matter is we're right on the date. Okay? How we found out about it is my business."
[11] The trial judge questioned Grisoni's attorney about the relevance of Haltom's testimony. Grisoni's attorney, Steve Markovitz, responded that Haltom's testimony was relevant to whether Haltom's law firm should be permitted to continue representing Wright at the trial. Wright's attorney, Steve Vescovo, indicated that Wright did not object to Haltom's testimony because Grisoni's attorney had called into question Haltom's ethics and Wright wished to respond. Haltom's testimony later became relevant to the issue of malicious prosecution for which Grisoni sought damages at the subsequent damages hearing.
[12] The additional $250,000 bond was posted by Wright, not Travelers.
[13] On July 15, 1999, Grisoni filed a motion with the trial court to amend and supplement his Answer to include an allegation of damages suffered as a result of the wrongfully issued injunction, as well as a request for punitive damages.
[14] Operation costs were estimated at between 20 and 30 percent of total sales, leaving Grisoni with between $310,000 and $350,000 monthly profit.
[15] The Court takes judicial notice that lawyers can be pugnacious witnesses.
[16] Grisoni's allegation, that Haltom's statement constitutes a threat of criminal prosecution that violates the rules of ethics which govern attorneys, is not pertinent to this action.
[17] Wright was able to develop an Osteoset prototype within a few weeks of opening the package of Ethicon pellets and Grisoni argues that this mitigates against Wright's assertion that the development of an Osteoset device occurred over a long period of trial-and-error experimentation and at great expense. However, Wright did not start from scratch upon opening the Ethicon packet. Rather, Wright was able to use much of what it had learned during the previous year's research into other calcium sulfate products.
[18] Grisoni's knowledge allowed him to avoid much of the trial-and-error experimentation that would plague other new entrants into the market. This fact is significant but not necessarily determinative. Koehring Co. v. E.D. Etnyre & Co., 254 F. Supp. 334, 339 (N.D.Ill.1966).
[19] As noted in the discussion of the proceedings in this case, at the time of the hearing to dissolve the injunction, the injunction bond was raised to $250,000. When the order dissolving the injunction was appealed, the appellate court stayed the order and raised the bond to $500,000. Thereafter, while an order was in effect staying the trial court proceedings, the trial court raised the bond to $2.4 million. However, because there was a stay in effect, this order was vacated. Grisoni appealed this order on the bond to the Tennessee Supreme Court; his petition was denied. The bond remained unchanged until the hearing on damages was concluded, after which the injunction was dissolved.
[20] Tenn.Code. Ann. § 29-23-104(a) (2000) provides:
In cases where the court is of the opinion that the party enjoined has suffered a substantial injury, but that damages are speculative or incapable of ascertainment under legal rules, it may, on dissolution, in its sound discretion, assess and decree against the party suing out the writ a penalty in favor of the party enjoined. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1589302/ | 972 So.2d 1035 (2008)
AMERICAN EXPRESS INSURANCE SERVICES EUROPE LIMITED, Appellant,
v.
Johanna DUVALL, Helen Duvall, and Vincent Sansalone, Appellees.
No. 3D07-1194.
District Court of Appeal of Florida, Third District.
January 16, 2008.
*1037 Mase & Lara, Miami and Joel V. Lumer; Kahan Shir and Paul E. Heimberg, Boca Raton, for appellant.
Roy D. Wasson and Annabel C. Majewski, Miami; Brett Weinberg, Coral Gables, for appellees.
Before RAMIREZ, SUAREZ, and ROTHENBERG, JJ.
RAMIREZ, J.
American Express Insurance Services Europe Limited ("AEISEL") appeals the denial of its motion to dismiss based upon waiver of jurisdiction and/or Florida's long arm statute. We reverse because we conclude that AEISEL is not subject to personal jurisdiction in Florida for claims that arose in Florida, based on an insurance policy issued in the United Kingdom, and AEISEL did not waive its objection to personal jurisdiction.
I. Factual Background
AEISEL acts as intermediary between insurance companies and retail customers for the sale and purchase of traveler's insurance policies. The decedent Johanna Duvall was one of those retail customers. She purchased a policy in the United Kingdom effective from May 27, 2004 to May 26, 2005. In the policy section titled "Policy Information," under the subheading "[t]he insurers," Viator agreed to "provide the insurance benefits and AXA Assistance (UK) Ltd. the services described in the Policy booklet during the period of insurance." The insurance policy, was "effected in England and governed by the laws of England and Wales." The insurance policy automatically renewed each year.
Duvall subsequently suffered a stroke in Florida and requested the benefits due under the policy. On her return commercial flight from Florida to Great Britain, Duvall suffered severe permanent injuries for which she sued numerous defendants, including counts for breach of contract and negligent entrustment against. AEISEL. The complaint alleged that AEISEL conducted business worldwide, and more specifically in Miami-Dade County, Florida.
The plaintiff served process on American Express Company. Attorney Debra M. Cohen filed a motion to dismiss American Express, explaining that the service had been effected on the wrong party. Meanwhile, plaintiff's counsel sent notices of depositions of two employees of defendant AXA Assistance USA: Hector Ojeda and Rodolfo Medina. AEISEL was served with process on May 15, 2006. The next day, the circuit court signed an agreed order dismissing American Express. The depositions took place on May 23, 2006, with various defendants attending via telephone. Attorney Cohen, who had represented American Express, attended in person, on behalf of AEISEL. On June 6, she filed a motion to dismiss attacking personal jurisdiction over AEISEL.
II. Jurisdiction
In support of its motion to dismiss, AEISEL filed the affidavit of its general manager, Graham P. Setterfield. Setterfield testified that AEISEL is a United Kingdom corporation with its principal offices located in London. It does not issue or underwrite insurance policies, and it functions as a regulated insurance intermediary *1038 or insurance agent of the insurer. Setterfield further testified that AEISEL is not registered in Florida as a foreign corporation or foreign insurer qualified to transact business in Florida; has not transacted business in Florida; has never had any directors, officers, employees, or agents in Florida; has not maintained any offices in Florida; does not own, lease, manage, or otherwise have any interest in real property in Florida; does not sell, consign or lease tangible or intangible personal property, directly or indirectly, in Florida; has never had any bank accounts in Florida; has not had any monies sent to it in Florida; has not received mail in Florida; does not market itself or its services directly or indirectly in Florida; and it has not received any pecuniary benefits from or in Florida.
In opposition to AEISEL's motion to dismiss, Duvall introduced the affidavit of attorney Brett A. Weinberg. Weinberg testified that AEISEL maintains a web page on the internet, showing that it is owned by American Express Company, the former defendant.
The standard of review is de novo whenever a case, such as this, arises from the trial court's decision on a motion to dismiss for lack of personal jurisdiction. Wendt v. Horowitz, 822 So.2d 1252, 1256-57 (Fla.2002); Enic, PLC v. F.F.S. & Co., 870 So.2d 888, 889 (Fla. 5th DCA 2004).
We conclude that the trial court did not have personal jurisdiction over AEISEL. In determining whether long-arm jurisdiction is appropriate in a given case involves a two-step inquiry. First, it must be determined that the complaint alleges sufficient jurisdictional facts to bring the action within the ambit of the long-arm statute. Venetian Salami Co. v. Parthenais, 554 So.2d 499, 502 (Fla.1989). If the requirements of the first prong are met, the next inquiry is whether sufficient "minimum contacts" are demonstrated. Id.
Duvall attempts to satisfy the first prong through section 48.193(1)(d), Florida Statutes (2006), which provides, in relevant part, as follows:
(1) Any person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from the doing of any of the following acts:
. . .
(d) Contracting to insure any person, property, or risk located within this state at the time of contracting.
There is nothing in the record of this case to intimate that the insurance contract was entered into anywhere other than the United Kingdom. At the time that the contract of insurance was entered into, there was no person, property or risk located within the State of Florida.
Failing the first prong, we need not reach the second. But as to minimum contacts, Duvall's argument is even weaker. There are insufficient contacts here to permit the trial court to exercise personal jurisdiction over AEISEL under the well-established principles that govern personal jurisdiction over non-residents as enunciated in Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). The test is whether "the defendant's conduct and connection with the forum are such that he should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 287, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980).
The evidence establishes that AEISEL only acts as an agent for retail customers within the United Kingdom. Certainly some of these customers may turn up in Florida, but also in France, Germany and *1039 Spain. A company like AEISEL that services customers within the United Kingdom acting as an insurance agent for policies that specifically provide that they are subject to "the laws of England and Wales" cannot reasonably anticipate being haled into court anywhere in the world where its customers may travel.
Duvall relies upon Dollar Systems, Inc. v. Elvia, 863 So.2d 378 (Fla. 4th DCA 2003), where Elvia, a Swiss company with its main office in Germany, sold travel insurance through a German tour operator, C.A. Ferntouristik ("CAF"), which in turn marketed tour packages to German citizens traveling in the United States. CAF contracted with Dollar for Dollar to provide rental cars in Florida to the tourists. Id. at 379. Through CAF, Elvia provided excess liability insurance over the insurance provided by Dollar. Id.
After some of the tourists were involved in accidents in Florida while driving Dollar vehicles, Dollar sued Elvia seeking declaratory relief as to the priority of coverage. Id. Elvia argued that it was not subject to personal jurisdiction under section 48.193(1)(d) because, when it entered into this contract with CAF in Germany, there was no "risk located within this state at the time of contracting." Id. The court reasoned, however, that Elvia's contract with CAF was merely a contract to provide insurance in the future. Id. The contract to insure contemplated by the statute was the insurance coverage which did not become effective until the insured rented the car. Id. The premium charged was a specific amount per car per day. Id. When that coverage became effective, Elvia knew that the car was being rented in Florida. Id.
In contrast, there is no indication that AEISEL knew that. Duvall, a British national, was traveling to Florida or that its customers were regularly finding themselves within this state more than any other popular tourist destination. The choice-of-law provision in the policy can be viewed as indicating the intent of the parties to submit any future litigation to the courts of England or Wales.
Likewise, in Glovegold Shipping Ltd. v. Sveriges Angfartygs Assurans Forening, 791 So.2d 4 (Fla. 1st DCA 2000), a foreign insurer had insured a foreign vessel which the insurer knew would be sailing in Florida waters. Following an accident off the coast of Jacksonville, the insured brought suit against the insurer in Florida. Id. at 8. The First District Court concluded that the foreign insurer had contracted to insure a risk located in Florida under section 48.193(1)(d). Id. at 11. Our case differs in that there is no evidence that Duvall was located in Florida when she was issued the insurance policy.
Duvall relies upon AEISEL's maintenance of a web page on the internet wherein it holds itself to be and owned by American Express Company. This fact does not confer in personam jurisdiction to the courts in Florida. As the Fifth District stated in Westwind Limousine, Inc. v. Shorter, 932 So.2d 571, 574 n. 7 (Fla. 5th DCA 2006), "merely posting] a passive website" does not constitute the solicitation of business in this state, or the transaction of business in this state for purposes of a due process jurisdictional analysis.
Similarly, the fact that Florida courts have jurisdiction over American Express Company does not confer jurisdiction over its subsidiary, AEISEL. To support some alter-ego theory of liability, Duvall would have to allege that the corporations were formed or used for some illegal, fraudulent, or other unjust purpose. See McFadden Ford, Inc. v. Mancuso, 766 So.2d 241, 243 (Fla. 4th DCA 2000). "[O]wnership of a subsidiary corporation by an out-of-state parent corporation, without more, does not support a finding *1040 that long-arm jurisdiction exists." Extendicare, Inc. v. Estate of McGillen, 957 So.2d 58, 64 (Fla 5th DCA 2007). The corollary is also true: jurisdiction over a parent company does not, without more, confer jurisdiction over the subsidiary. "A parent corporation and its whollyowned subsidiary are separate and distinct legal entities." Am. Int'l Group, Inc. v. Cornerstone, Businesses, Inc., 872 So.2d 333, 336 (Fla. 2d DCA 2004); Molenda v. Hoechst Celanese Corp., 60 F.Supp.2d 1294, 1300 (S.D.Fla.1999) (stating that subsidiary corporations are generally independent entities, and that a corporate veil will be pierced only in certain circumstances).
III. Waiver
A more difficult issue is whether AEISEL waived its jurisdictional objection by participating in the depositions of Medina and Ojeda. During Medina's deposition, AEISEL objected several times, and it asked at least one question. During Ojeda's deposition, AEISEL requested a stipulation that one defense attorney's objections apply for all of the defendants. AEISEL objected approximately nineteen times, and its counsel was the only defense attorney who questioned Ojeda during cross-examination. Some of the questions involved the nature and quality of the transportation services AXA Assistance provided Duvall and Duvall's family.
At the motion to dismiss, AEISEL argued that its counsel only attended the depositions and questioned the witness as a defensive measure, in case the witness became unavailable for trial. AEISEL further argued that the questions were only for clarification purposes, did not relate to the merits of the case, related to fact questions already asked, and did not relate to the issue of jurisdiction. When questioned on the issue of waiver, counsel for AEISEL argued that she did not have to stipulate to a limited appearance or to object to jurisdiction prior to the depositions. AEISEL argued that, at the time the depositions took place, it did not know what defenses it was going to raise.
In her amended affidavit, AEISEL's defense attorney Debra M. Cohen testified that she was compelled to attend the depositions in light of statements by Duvall's counsel that he intended to use Ojeda's videotaped deposition at trial if Ojeda could not be produced for trial; Ojeda's statements that he intended to leave the United States; and the statement by counsel for AXA Assistance that his client could only agree to produce Ojeda for trial if he remained an AXA Assistance employee.
Cohen further testified before the trial court at the hearing on the motion to dismiss. She again reiterated that she decided to ask questions of Ojeda during cross-examination for clarification purposes; she did not ask for affirmative relief; and that she merely defended a factual deposition.
Although the better practice would have been for Cohen to announce its objection to jurisdiction at the start of the depositions, we conclude that under the facts of this case, AEISEL did not waive its objections to personal jurisdiction. We recently stated that a party that seeks "true affirmative relief before moving to dismiss on the basis of lack of personal jurisdiction," or who fails "to challenge personal jurisdiction at the earliest opportunity" can be deemed to have waived the issue. Marcos v. Haecker, 915 So.2d 703, 705 (Fla. 3d DCA 2005). We do not see how a party can challenge personal jurisdiction at a deposition. Thus, the only issue is whether AEISEL's attendance and limited participation at the two depositions can be deemed to have been seeking true affirmative relief. We do not believe that attending and participating to a limited extent at two depositions that were scheduled by Duvall before AEISEL was required to *1041 respond to Duvall's complaint constitutes affirmative relief.
There are various types of conduct that constitute a waiver of the defense of lack of personal jurisdiction, such as "seeking affirmative relief . . . [that] is inconsistent with an initial defense of lack of personal jurisdiction" or "filing of permissive counter-claims and cross-claims, or requests that a court take jurisdiction of a proceeding." See Alvarado v. Cisneros, 919 So.2d 585, 587-88 (Fla. 3d DCA 2006). In this case, AEISEL raised the issue at its first responsive pleading, a motion to dismiss for lack of personal jurisdiction. It did not file a counterclaim or crossclaim and did not request that the trial court take jurisdiction over the proceeding. Cohen testified that her actions at the depositions were purely defensive in nature. If a party does not seek affirmative relief and, instead, it defends a lawsuit, the party does not waive the defense of lack of personal jurisdiction. Id at 588. Our situation is analogous to the Motion for Enlargement of Time filed in Barrios v. Sunshine State Bank, 456 So.2d 590, 591 (Fla. 3d DCA 1984), where we held that the motion did not constitute a general appearance and hence a waiver of the defense of lack of personal jurisdiction.
Florida Rule of Civil Procedure 1.140(h)(1) specifically allows the defense of lack of jurisdiction over the person to be presented in a responsive pleading. Rule 1.140(h)(1) states: "(1) A party waives all defenses and objections that the party does not present either by motion, under subdivisions (b), (e), or (f) of this rule or, if the party has made no motion, in a responsive pleading except as provided in subdivision (h)(2)." It is undisputed that AEIEL disputed the court's jurisdiction in its first responsive pleading.
III. Conclusion
In sum, the trial court's finding that jurisdiction over AEISEL could be based upon section 48.193(1)(d) for an insured risk in this state is simply unsupported. Additionally, there are insufficient contacts between AEISEL and Florida to permit a court of this state to assume personal jurisdiction. To hold otherwise would be contrary to due process requirements. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.E d.2d 490 (1980); Int'l Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945). Furthermore, the evidence does not show that AEISEL's appearance at the depositions constituted a waiver of the defense of lack, of personal jurisdiction. We therefore reverse the trial court's denial of AEISEL's motion to dismiss.
Reversed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1646317/ | 9 So.3d 859 (2009)
David and Renee CHRISTENSON
v.
Louis MADERE, et al.
No. 2009-OC-1192.
Supreme Court of Louisiana.
June 3, 2009.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919085/ | 107 N.H. 153 (1966)
WILLIAM J. GAUTHIER
v.
HENRY A. BERGERON.
No. 5402.
Supreme Court of New Hampshire.
Argued January 5, 1966.
Decided April 7, 1966.
Sheehan, Phinney, Bass & Green and Alan L. Reische (Mr. Reische orally), for the plaintiff.
Devine, Millimet, McDonough, Stahl & Branch (Mr. Bartram C. Branch orally), for the defendant.
BLANDIN, J.
The questions before us are: (1) Was the admission of the defendant's opinion as to the distance within which he could stop his car reversible error? and (2) "On the basis *154 of the trial record, should the court have denied the defendant's motion for reduction of the verdict to $10,052?"
The record would support the following findings of fact by the jury:
The plaintiff and the defendant were riding on a winter night in the defendant's car, which he was driving, when they were struck by a train which was traveling from Boston to White River on the Mill Street crossing in Lebanon, New Hampshire. The roads were dry, the weather was clear, and the crossing was protected by flashers and a bell. The automobile was traveling at about fifteen to twenty miles per hour, and the train was going at approximately the same speed.
Counsel for the plaintiff called the defendant to the stand and was cross-examining him, as was proper under RSA 516:24. He brought out the fact that the defendant was an experienced driver, used to a great variety of situations and conditions, and that he had operated this particular automobile for about a year. During his years of driving, he had occasion to stop "under all sorts of circumstances," including the making of "sudden stops." The brakes of his 1959 model car were in excellent condition. Just before the accident, the defendant had seen a flashing red light, and he was approaching the crossing on an up grade. Having developed these circumstances, plaintiff's counsel asked the witness for his "best estimate" as to the distance within which he could have stopped his car. Defendant's counsel stated: "I object unless there is some evidence here this man is an expert." Upon his objection being overruled, he said "Exception," which the Court granted. The witness then replied to the question: "I think I could have stopped it within four or five feet."
Our rule that the admissibility of opinion evidence depends on whether, within the discretion of the Presiding Justice, it may aid the jury in their search for truth, has been dwelt upon too often and at too great lengths to require extensive review here. Dowling v. Shattuck, 91 N. H. 234; Sigel v. Boston & Maine R. R., 107 N. H. 8. Counsel's objection to the testimony was on the sole and specific ground that the witness was not qualified as an expert. No other grounds, if any should exist, are now open to him. Plante v. Manchester, 83 N. H. 57, 59. In view of the defendant's experience in operating this particular automobile we believe the court could find that his testimony might *155 aid the jury. Dowling v. Shattuck, supra; See Mittersill Ski Lift Corp. v. State, 105 N. H. 219, 222. The exception to its admission is therefore overruled.
As relevant to the question whether the verdict was so excessive that a remittitur should have been ordered, the jury could have found the following facts: The plaintiff's out of pocket expenses, including hospital, medical and lost wages, amounted to $4,052.28. Up to the time of the accident the plaintiff, who was then fifty-five years of age, had been in good health, very active, "raring to go" and able to carry on his work and other affairs normally, free from pain. On being struck by the train, he was rendered unconscious, and upon recovering his faculties he found himself in a snow bank. He was feeling intense pain in his right arm and leg. He also had a "big gash" on the back of his head and a sizable wound in his right arm caused by flying glass. He had chest pains, "terrific headaches," which persisted up to the time of the trial.
The worst injury was to his right ankle. His physician, Dr. Donald J. Flanagan, diagnosed this as an inversion ankle injury resulting from many torn ligaments and tendons and ruptured blood vessels in the ankle. The doctor described this injury as "almost invariably a severe type of injury . . . almost invariably it can be very much worse than a bone fracture." He felt that it would continue to plague the plaintiff "indefinitely."
As a result of his injuries, the plaintiff was bedridden for some two weeks, on crutches for about three months, and forced to use a cane for several months afterward. His ankle continued to swell and pain him, and he had to soak it in Epsom salts practically every night nearly up to the time of the trial and until another illness forced him off his feet. As a result of the accident, he became depressed, worried, tense and fatigued. If he went out in the evening, he had to remove his shoe often on account of the pain and swelling in his ankle. He ran a "rather high" blood pressure due, as his doctor testified, to "worries and the continual pain . . ." caused by his injuries. While there was some contradictory evidence, to a degree, at least, to be gathered, among other sources, from his hospital record, no physician appeared for the defendant to dispute Dr. Flanagan. Such conflicts as did exist were plainly for the jury. Davis v. Nees, 100 N. H. 144.
*156 We need not further detail the injuries and their effects upon the plaintiff. In this state of the evidence, it cannot be said as a matter of law, upon the record before us, that error was committed by the Court's denial of the defendant's motion to set aside the verdict or to order a remittitur. Welch v. Hood & Sons, 104 N. H. 207. We are unable to accept the defendant's argument that what the Court said some twenty-five years ago on January 7, 1941, about the size of the verdict in Dowling v. Shattuck, 91 N. H. 234, constitutes "a relevant comparison of verdicts." In upholding the $7,000 award, the Court observed: "It is large but we cannot say it is excessive as a matter of law." Id., 243. Such mild whispers of inflation, if any, as may have been audible in January, 1941, hardly compare with the sounds which we hear today. The emaciated value of the dollar when the jury returned its verdict for the plaintiff Gauthier, contrasted with its value in 1941, nearly a year prior to World War II, is an indisputable fact, both relevant and significant. Lamontagne v. Lamontagne, 100 N. H. 237, 239; 12 A.L.R. 2d 611, 621.
The defendant's exceptions are overruled, and the order is
Judgment on the verdict.
All concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2721341/ | Filed 8/27/14 Marriage of Andrews CA3
NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Sutter)
----
In re the Marriage of KITO and ELADIA
ANDREWS.
KITO ANDREWS,
Appellant, C073893
v. (Super. Ct. No. CVFL083136)
ELADIA ANDREWS,
Respondent.
Husband Kito Andrews appeals from postjudgment orders wherein the trial court
found wife Eladia Andrews’s retirement account was not a community asset omitted from
the final judgment. We conclude the trial court erred as a matter of law in ruling the
retirement account was not an omitted asset and remand this matter for further
proceedings.
1
BACKGROUND
A judgment dissolving the parties’ marriage was entered on October 26, 2010.
Incorporated into that judgment was a property order, in which the court found there was
no community property to divide.
On July 31, 2012, husband filed a request for order from the trial court, asking the
court to find wife intentionally failed to disclose her retirement account, a community
asset, and to distribute that account accordingly. Husband also asked the trial court to
award him Family Code section 271 sanctions, and order wife to pay his attorney fees, on
the ground she breached her fiduciary duty to husband by failing to disclose a community
asset.
On December 5, 2012, the trial court presided over a hearing at husband’s request.
At that hearing, the trial court heard testimony from husband and wife and considered
documentary evidence each of them submitted. The minutes from that hearing indicate
the court found husband “has the burden of proof as to the omitted asset. The burden of
proof was not met therefore motion is denied. [¶] Court finds insufficient behavior for
both request[s] for [Family Code section] 271 sanctions, [r]equest[s] for sanctions [are]
denied. [¶] Respondent’s request for Attorney fees is denied.” That same language was
later memorialized in formal findings and orders.
Husband appeals from those orders.
Included in the record on appeal is an “Agreed Upon Statement” executed by
husband and wife, which includes a brief summary of the parties’ respective testimony.
According to that statement, the parties agree the trial court found neither husband nor
wife completed a disclosure. The court nevertheless found wife’s retirement account was
“disclosed” in a pay stub attached to wife’s income and expense declaration, which was
submitted on a separate motion for child support. Thus, the court concluded, the
retirement account was not an omitted asset and neither party’s conduct warranted
sanctions.
2
DISCUSSION
Husband contends the trial court erred in finding wife’s retirement account was
disclosed and thus was not an omitted asset. We agree.
An omitted asset is “any community estate asset . . . omitted or not adjudicated by
the judgment.” (Fam. Code, § 2556; see Miller v. Miller (1981) 117 Cal.App.3d 366, 371
[community asset must be placed in issue, adjudicated, or divided by the court; otherwise
it is an omitted asset subject to postjudgment distribution].) The record on appeal
establishes unequivocally that wife’s retirement account was not adjudicated in the
judgment entered on October 26, 2010. It is therefore an omitted asset as a matter of law.
The trial court nevertheless ruled the retirement account was not an omitted asset
because, while it was not adjudicated in the judgment, it was otherwise disclosed.1 There
is no authority to support that ruling. We reverse the trial court’s ruling in this regard.
Because we reverse the trial court’s ruling and conclude the retirement account is,
in fact, an omitted asset, we remand this matter to the trial court for further proceedings.
Specifically, the trial court is directed to consider the retirement account in accordance
with the statutory requirements and determine whether to divide the account and, if so,
how the account should be divided. In so doing, the trial court also is directed to consider
husband’s request for sanctions and attorney fees, including but not limited to whether
wife breached her fiduciary duty.
1 Although we need not address the issue here, we question whether the revelation
of wife’s retirement account in a pay stub, attached to an income and expense declaration
and filed in support of a separate child support case, constitutes “disclosure” as that term
is used in the Family Code. Family Code section 2104 requires both parties to disclose
their assets and liabilities in a preliminary declaration of disclosure, “on a form
prescribed by the Judicial Council.” (Fam. Code, § 2104; In re Marriage of McLaughlin
(2000) 82 Cal.App.4th 327, 335 [error to enter judgment if preliminary declarations were
not exchanged and prejudice is proven].) That was not done here. Since husband did not
file a preliminary declaration either, we do not decide whether this is a factor to be
considered by the court on remand.
3
DISPOSITION
The trial court’s order that wife’s retirement account was not an omitted asset is
hereby reversed and the matter is remanded for further proceedings consistent with this
opinion. Husband shall recover his costs on appeal. (Cal. Rules of Court,
rule 8.278(a)(2).)
HOCH , J.
We concur:
HULL , Acting P. J.
ROBIE , J.
4 | 01-03-2023 | 08-27-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/731308/ | 102 F.3d 1368
The SUNBEAM-OSTER COMPANY, INC. GROUP BENEFITS PLAN FORSALARIED AND NON-BARGAINING HOURLY EMPLOYEES,Plaintiff-Appellant,v.Leonard WHITEHURST, Jr., Defendant-Appellee.
No. 95-31269.
United States Court of Appeals,Fifth Circuit.
Dec. 19, 1996.
Mark Edward Seamster, Seale, Macaluso, Daigle & Ross, Hammond, LA, for Sunbeam-Oster Company, Inc., plaintiff-appellant.
Michael J. Mestayer, Leger & Mestayer, New Orleans, LA, for defendant-appellee.
Appeal from the United States District Court for the Eastern District of Louisiana.
Before KING, SMITH and WIENER, Circuit Judges.
WIENER, Circuit Judge:
1
Resolution of the principal issues presented by this appeal requires the construction and application of reimbursement and subrogation provisions of the Plaintiff-Appellant Sunbeam-Oster Company, Inc. Group Benefits Plan for Salaried and Non Bargaining Hourly Employees (the Plan), a self-funded welfare benefit plan under the Employee Retirement Income Security Act of 1974 (ERISA).1 This litigation was spawned when Defendant-Appellee Leonard Whitehurst, Jr.--a plan beneficiary who had been seriously injured in a motor vehicle accident unrelated to his employment and whose resulting six-figure medical expenses were paid by the Plan--refused to reimburse the Plan for payments it made on his behalf, even though he had recovered more than sufficient funds with which to do so from a settlement with third parties. For the reasons hereafter explained, we reverse the district court's judgment favorable to Whitehurst and hold that the plain language of the Plan was neither silent nor ambiguous but, at least by unmistakable implication, embodied a "first dollar" priority right in favor of the Plan (hereafter "Plan Priority") to be reimbursed from the proceeds of a beneficiary's recovery.
2
* FACTS AND PROCEEDINGS
3
A. The Accident; The Plan; Whitehurst's Lawsuit
4
Whitehurst, a long-time employee of Sunbeam-Oster Company, Inc. (Sunbeam), was severely injured in a non-work related accident when an eighteen-wheel tractor/trailer (the rig) crossed the centerline of a rural Louisiana highway and collided with his car. Whitehurst's extreme injuries necessitated extensive surgery, hospitalization, and rehabilitation.
5
Whitehurst was covered by the Plan as a dependent under a family coverage arrangement in which his wife, also a Sunbeam employee, was the participant and paid the premiums. As a covered dependant he was a beneficiary of the Plan and thus was entitled to have his medical bills--totaling approximately $137,000 as of the time briefs were filed in this appeal--paid by the Plan. The Plan was a self-funded, participant-contributory, employee welfare benefits plan governed by ERISA, and provided health and medical benefits on a voluntary basis to thousands of employees of Sunbeam and their designated beneficiaries.2 Participants were required to make contributions to the Plan, but as their total contributions were insufficient to pay the aggregate costs of covered services, claims were largely paid from the general assets of Sunbeam. Blue Cross and Blue Shield of Mississippi, Inc. (Blue Cross) served as the "third party administrator" of the Plan. In that capacity, it processed the claims of Plan participants and their beneficiaries.
6
After his accident, Whitehurst hired a lawyer and, together with his wife and minor child, both of whom had witnessed the critically injured Whitehurst being pried from his car at the scene of the accident, filed a state court negligence suit against the driver of the rig, its owner, and the owner's insurer. They asserted claims for Whitehurst's injuries and his wife and son's loss of consortium.3
7
The Whitehursts' attorney finally informed the Plan of this lawsuit when settlement appeared imminent, and requested itemized medical expense statements so that he might "protect [the Plan's] interests."4 Partly in reliance on this communication from Whitehurst's counsel, the Plan chose not to intervene in the suit or participate in any settlement negotiations.
8
The Whitehursts ultimately settled all their tort claims arising from the accident jointly for $500,000, the limit of the rig owner's insurance policy, plus $9,000 in property damages. The settlement agreement neither apportioned the recovery among the plaintiffs nor itemized the $500,000 lump sum as to medical expenses or, for that matter, any other category of damages. In that agreement, however, the Whitehursts expressly absolved the defendants and agreed to hold them harmless from liability for "all medical expenses, hospital expenses and liens incurred by and in connection with any medical treatment rendered to [Whitehurst]."
9
B. The Reimbursement Provisions of the Plan; the Plan's Lawsuit
10
In compliance with requirements under ERISA, Sunbeam had filed the original plan document for the Plan with the Department of Labor about two years before Whitehurst's accident. As is typically the case with ERISA self-funded welfare benefit plans, the document filed with the Department was not a formal trust indenture (here, there was none), but rather an employee benefits handbook, a "Summary Plan Description" (SPD) in ERISA parlance. As discussed more fully below, ERISA insists that the SPD be couched in ordinary conversational terms, understandable by the average reasonable employee, and not in verbose "legalese" or "insurance speak."5 The health care benefits section of the Plan's SPD contained a number of "General Exclusions," one of which was for:
11
charges for which payment or reimbursement is received by or for the individual as a result of a legal action or settlement (unless you [the participant or beneficiary] sign the necessary documents authorizing the deduction of any overpayment from your benefit, wage and pension payments).
12
That section of the SPD also contained a subsection titled "Subrogation," which, stated in full, provided:
13
Subrogation allows the Plan to recover duplicate benefit amounts. For example, if you are injured by another individual and incur $1000 in covered expenses--and you sue that individual and recover $1000--the Sunbeam-Oster Plan does not pay benefits for those expenses. If the plan has already paid benefits, it has the right to recover payment from you. This also applies to benefits paid through the Plan's COB [Coordination of Benefit] feature.
14
The subrogation and COB features only apply for group insurance plans (not to individually purchased coverage)--including automobile no-fault programs.
15
Several months prior to Whitehurst's accident, the Plan issued to plan participants (but did not file with the Department of Labor) an "Insert and Summary of Material Modification" to replace the above quoted "Subrogation" subsection. This modification, titled "Subrogation and Reimbursement Provisions," stated in pertinent part:
16
The Plan has subrogation and reimbursement provisions which allow the Plan to recover for benefits it pays which are duplicated from another source. The Plan provides an automatic lien on any funds subject to reimbursement or subrogation.
17
Reimbursement gives the Plan the right to collect from you money that you receive in a settlement or lawsuit that covers expenses that the Plan has already paid for....
18
Reimbursement Example--You are injured and receive $1,000 in covered expenses from the Plan. The person who caused your injury agrees to settle with you and pays you the $1,000. The Sunbeam-Oster Plan has a legal right to reimbursement from you of the $1,000.
19
This provision essentially reiterates the general reimbursement right described in the original SPD's "Subrogation" section but expands it by removing the previous version's limitation on the Plan's right to subrogation and reimbursement from the proceeds recovered by the participant or beneficiary from individually purchased insurance coverage--a matter not at issue here.
20
Two or three months after the accident but before any medical bills had been paid, Blue Cross sent Whitehurst a standard form that inquired about, inter alia, the possibility of recovering the Plan's medical expenses from a third party tortfeasor.6 Whitehurst completed most sections of the form, signed it, and returned it to Blue Cross; however, he left unsigned the reimbursement/subrogation section of the form. That section provided:
21
I request that payment of benefits be advanced and in consideration of such payment I agree that should any recovery be obtained by me from the responsible person(s) or from his insurer(s), I will reimburse Blue Cross & Blue Shield of Mississippi, Inc., the total amount of benefits provided by it up to the amount of my recovery.
22
The next month, while Whitehurst was convalescing at home and undergoing out-patient treatment at a rehabilitation facility, Blue Cross wrote to him, enclosed another copy of the same form, and advised him that his failure to sign and return the reimbursement/subrogation portion of the form would be interpreted by Blue Cross as signifying that his medical bills would be paid by or from some other source. About a week after Whitehurst received this second copy of the form--and without comment, question, or objection--he signed the reimbursement/subrogation section and returned the form to Blue Cross. A short while later the Plan began paying his medical bills.
23
The particular Blue Cross form, copies of which Whitehurst signed, had not been specifically tailored for use with the plan. Rather it was a generic document then being used widely and routinely by Blue Cross for many plans that it served in the same or similar administrative capacities.
24
The Plan's amicable efforts to obtain reimbursement from the Whitehursts after they had settled their lawsuit proved fruitless, so suit was filed against Leonard Whitehurst individually seeking (1) reimbursement of the medical benefits that the Plan had paid on his behalf, (2) a credit or offset for future medical expenses that Whitehurst was projected to incur, up to the full amount of his settlement, and (3) interest and reasonable attorneys' fees. Whitehurst answered and filed counterclaims against the Plan, alleging that it had breached its fiduciary duty to him by failing to (a) treat his claim consistently with other claims, (b) pay his ongoing medical claims, and (c) furnish him a copy of the Plan description. In conjunction with these counterclaims, Whitehurst sought penalties, damages, interest, and attorneys' fees.7
25
Following completion of a two day bench trial, the district court entered a judgment in favor of Whitehurst, dismissing the Plan's complaint and Whitehurst's counterclaim. In its Reasons for Judgment, the court found that the Plan's plain language was silent as to the Plan's rights of reimbursement and subrogation in the case of a beneficiary who only partially recovers his damages from a third party. That silence, the court concluded, called for a determination of the intent of the parties. Rejecting the probative value of evidence adduced by the Plan to establish that the intent of the parties was for the Plan to be entitled to a Plan Priority reimbursement right to any funds recovered by a beneficiary, the court determined that the parties had not formed an intent on the issue. The court next observed that this circuit had not yet announced a rule of interpretation to apply to subrogation and reimbursement rights of ERISA plans in the absence of any discernible intent regarding the nature, extent, or sequence of such rights--either from the plain language of the Plan or the objectively determined intent of the parties as manifested by extrinsic evidence. The court therefore adopted, as a matter of federal common law, the Make Whole principle of subrogation and reimbursement as a default rule of construction. Under the Make Whole rule, a plan is not entitled to recoup anything by way of subrogation or reimbursement until the beneficiary has been made entirely whole through recovery of all compensatory damages to which he is entitled. In essence, the Make Whole rule is the diametric opposite of the Plan Priority rule: In the former, a plan gets no reimbursement until the beneficiary has been made whole; in the latter, the beneficiary retains nothing until he has reimbursed the plan (or the plan has recovered through subrogation) all funds expended on medical costs of the beneficiary, dollar for dollar.
26
Finally, after adopting the Make Whole rule, the court found that Whitehurst had suffered damages of $2 million, and that his wife and child together had suffered an additional $500,000 in damages. It therefore ruled that the Plan had no right to reimbursement because Whitehurst had not been made whole by the settlement. The court also rejected both parties' claims for costs and attorneys' fees.
27
The Plan timely filed a Notice of Appeal, but Whitehurst did not appeal the district court's dismissal of his counterclaims. The Plan's principal contentions on appeal are that the district court erred in (1) finding the plain language of the Plan to be silent or ambiguous with respect to reimbursement rights and, alternatively, in disregarding evidence offered by the Plan with respect to the intent of the parties regarding those rights, (2) adopting the Make Whole principle as a default rule of construction with respect to the Plan and all other similarly situated plans, (3) attempting to quantify Whitehurst's damages, and (4) not awarding attorneys' fees to the Plan in accordance with 29 U.S.C. § 1132.
II
ANALYSIS
A. Standard of Review
28
In Firestone Tire and Rubber Co. v. Bruch8 the Supreme Court established the rule that courts must apply a de novo standard of review in actions brought by ERISA plan participants to challenge the denial of benefits unless the plan vests the plan administrator with discretionary authority to make eligibility determinations or construe the plan's terms. When the plan so endows its administrator, the decision of the administrator must stand unless there is an abuse of discretion.9 It is only in those cases involving plans that have not vested their administrators with such authority that the court must follow traditional principles of trust law and construe a participant's claim "as it would have any other contract claim--by looking to the terms of the plan and other manifestations of the parties' intent."10
29
Federal courts have consistently applied Firestone 's deference principles to actions concerning benefit determinations brought not only by participants but also by ERISA plans and, in particular, claims involving ERISA plans' assertions of purported reimbursement and subrogation rights.11 In this case, the parties agree that the version of the Plan in effect at the time of Whitehurst's injuries did not give the Plan administrator discretionary authority to interpret the Plan. Thus, the district court properly withheld deference and applied a de novo standard of review.
30
In turn, our consideration of the district court's rulings regarding the Plan's reimbursement rights must be conducted under the usual standards of review that we apply in non-jury civil cases:12 Questions of law, such as a court's interpretation of an ERISA plan when the plan's terms are clear and there is no grant of interpretive authority to a plan administrator--or even the preliminary determination whether an ERISA plan's language is silent or ambiguous--are reviewed de novo;13 findings of fact, such as the intent of the parties regarding an ERISA plan, are reviewed for clear error.14 Although a district court's weighing of the evidence is entitled to considerable deference, a factual finding may be "clearly erroneous" when we are "left with a definite and firm conviction that a mistake has been made."15
B. Interpretation of the Plan
1. The Language of the Plan
31
The fundamental predicate of the district court's judgment in this case lay in its holding that the language of the Plan's SPD--in this instance, the governing document of the Plan--was silent in regard to priority of reimbursement. The court found silence not on the Plan's entitlement to reimbursement vel non once a beneficiary obtains a judgment or settlement of partial recovery from a third party or his insurer, but only on the question of what law rule establishes the ranking or priority between the Plan and the beneficiary in a partial recovery situation; i.e., (1) Plan Priority, under which priority is given to the plan for full recovery "off the top," (2) Make Whole, under which priority is given to the beneficiary to keep everything he recovers from third parties until he is made entirely whole, or (3) Pro Rata, under which the plan and the beneficiary share ratably in the beneficiary's recovery from third parties. The district court examined the plain language of the "Subrogation" section of the SPD, as well as the subsequent "Material Modification" which replaced it, and found in particular that the former's reference to "duplicate benefit amounts" and the latter's statement that the Plan is entitled to recover "benefits it pays which are duplicated from another source," merely preclude the participant from receiving a "windfall" or "double recovery" and do not establish the priority of recovery in reimbursement between the Plan and a beneficiary.
32
With all due respect to the district court, we must disagree with its foundational premise with respect to this issue, i.e., that the plain language of the SPD's subrogation and reimbursement provisions is either wholly silent or ambiguous. At the outset, we emphasize that the Plan's reimbursement and subrogation provisions must be read in the statutory context of ERISA and, more particularly, in the precise textual context in which they appeared. In keeping with this observation, we remain keenly aware that subrogation and reimbursement provisions in ordinary commercial insurance policies and workers' compensation laws are far from analogous, and are at best instructive, when considering ERISA plans established solely in summary plan descriptions. Were this a diversity case involving reimbursement or subrogation in the context of either workers' compensation or individual or group insurance plans that are not ERISA plans, we would, of course, be Erie-bound to apply Louisiana's partial subrogation doctrine, which embodies the Make Whole principle.16 Yet, as it is well established that state subrogation doctrines are preempted under ERISA,17 we are not Erie-bound to apply Louisiana's partial subrogation rules here. Thus, even though we may borrow from analogous state law when it is not inconsistent with congressional policy concerns, our formulation of federal common law in the instant situation must remain guided foremost by the congressional policies expressed or implicit in ERISA.18
33
With these observations firmly in mind, we reiterate that the subrogation and reimbursement provisions at issue in this case were not part of a standard individual insurance contract purchased by or for the employee in the insurance market. If they had been, they would surely have been drafted with more particularity and with a plethora of legalistic boilerplate; and we would be subjecting them to a stricter standard of interpretation as well.19 Instead, though, the particular provisions that here created the Plan's reimbursement right appeared in the SPD, a document that is expressly required by ERISA to be "written in a manner calculated to be understood by the average plan participant," and need only be "sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan."20
34
Furthermore, as there was no separate master document or trust agreement in this instance, the SPD and modifications to it are the only writings that address basic questions of benefit eligibility and participant or beneficiary obligations under the Plan. Significantly, this kind of plan documentation is far from unusual; an SPD is frequently the only governing document created for and filed with the Department of Labor when the plan is a self-funded employee welfare benefit plan like the one we consider today. This is not surprising when it is recognized that the SPD is the only document that, under ERISA, is subject to mandatory filing with the Department of Labor and mandatory distribution to participants and beneficiaries.21
35
In light of these congressional imperatives and common industry practices, we should not (and will not) penalize the Plan, or other similar ERISA plans for that matter, for lack of technical precision or verbosity by labeling the Plan "silent" or "ambiguous" when it uses the kind of direct, jargon-free language that is mandated by ERISA for all summary plan descriptions and does not expressly address every conceivable factual variation of recovery, depending on which combination of source and fraction is under consideration at the time. In other words, the fact that the SPD for the Plan does not express a reimbursement priority for each possible combination or permutation--here, the beneficiary's partial recovery from the tortfeasor's insurer--is not a valid reason for branding the SPD as silent and subjecting it first to a search for the intent of the parties and then to a default rule of interpretation if their intent cannot be discerned.
36
In this case, the original subrogation subsection of the SPD stated plainly that "[s]ubrogation allows the Plan to recover duplicate benefit amounts ....," and added by way of explanation that, "[i]f the plan has already paid benefits, it has the right to recover payment from you." The Material Modification reiterated these straightforward concepts in language that is, as required by ERISA, just as unmistakably plain, clear, and understandable by the average reasonable employee:
37
The Plan has subrogation and reimbursement provisions which allow the Plan to recover for benefits it pays which are duplicated from another source.... Reimbursement gives the Plan the right to collect from you money that you receive in a settlement or lawsuit that covers expenses that the Plan has already paid for....
38
Thus, regardless of which version of the Plan is controlling,22 the central thrust of the Plan's reimbursement rights was made amply clear: The Plan is entitled to obtain reimbursement for "duplicate benefit amounts" or "benefits duplicated from another source."
39
When this language is read in context and viewed in light of all the circumstances, it can only mean that the Plan is entitled to be paid back by the beneficiary all amounts that the Plan has paid to the beneficiary, or on his behalf, to the full extent--but only to the extent--that the beneficiary recovers from another source (such as insurance purchased individually, a tortfeasor, the insurer of a tortfeasor, or the like). Far from the kind of silence that would be tantamount to ambiguity, the only silence here is the understandable absence of separate, specifically articulated rules for situations of partial recovery and total recovery with variations depending on the nature of the source of recovery. This signifies nothing more than that, regardless of source, the rule is the same for total and partial recoveries. Again, the absence of more particularized and technical legal language addressing the partial recovery situation cannot be grounds for supplanting the Plan Priority rule when recovery is partial, and thereby penalizing the Whitehursts' fellow employees.23 This is doubly so when ERISA dictates that summary plan descriptions be simple and understandable by employees of varying backgrounds, and when the governing subrogation and reimbursement provisions express a reasonable and, indeed, the generally understood, meaning of these concepts.24
40
That judges and lawyers, who by education and experience are primed to discover ambiguity in contract language, might find gaps or contradictions in a summary plan description's ordinary, conversational language does not mean that the language is necessarily ambiguous or silent to the point of default for ERISA purposes.25 Whatever might or might not be appropriate in cases involving workers' compensation or individual or group medical insurance policies,26 no such jurisprudential gloss can be justified in the context of a self-funded ERISA welfare benefit plan.
41
In sum, we hold that the plain language of the Plan's subrogation and reimbursement provisions was clear and unambiguous, and that--in the absence of any expressly selected alternative standard (such as Pro-Rata or Make Whole) which deviates from the anticipated Plan Priority norm--such language vested the Plan with an unconditional and unequivocal Plan Priority right to reimbursement for the full amount of the medical benefits it paid on a participant's behalf, from any and all funds that a participant might recover from, inter alia, a third party tortfeasor or his insurer. This holding is bolstered by the recognition that there is nothing included in or omitted from the Plan's plain language on which to base a conclusion that the Plan's unqualified and unequivocal right to reimbursement should be displaced by Pro Rata or Make Whole concepts.
42
2. The Parties' Intent; The Make Whole Rule
43
Having determined that the plain language of the pertinent portions of the SPD is clear and unequivocal--and thus neither silent nor ambiguous--and that such language vests the Plan with the right to recover in reimbursement from Whitehurst all amounts that the Plan has spent and will spend in providing covered benefits to Whitehurst, up to the full amount of his recovery from the instant tortfeasor and that tortfeasor's insurer, we do not reach the issues of the parties' intent or the appropriate default rule to be supplied by this circuit when the need occurs. It is axiomatic that we shall search for the intent of the parties only when the plain language under consideration is either ambiguous or silent, and we shall supply a default rule only when the necessary rule has not been supplied by the plan, the law, or the parties through their agreements.
44
Nevertheless, for us to arrive at the point in our review at which we could find the Plan's plain language sufficient unto the day, we had to consider with care the entirety of the district court's opinion and the law and evidence on which the opinion and judgment of that court are based. When we did so, we were left with the distinct impression that, were we to reach and consider those questions which we do not reach today, we would have serious misgivings about the district court's answers to them. In this regard we harbor some lingering concerns that if we were to stop at this point without adverting to the parties' intent or the default rule our readership might wrongly interpret today's opinion as merely reversing the district court "on other grounds," and by doing so misconstrue our failure directly to refute that court's pronouncements regarding intent of the parties and the appropriate default rule. As that is not the case, we close this portion of our opinion with a few brief observations concerning those points, so as to dispel any erroneous inferences that our readers might thus make.
45
First, had it been necessary for us to consider the question of the intent of the parties, we are not at all convinced that we would have agreed with the district court's conclusion that no intent is discernible regarding priority of reimbursement. On the contrary, we speculate that the intrinsic evidence in the record of this case may well have convinced us that the parties' intent was manifested, and that as manifested it embraced the Plan Priority rule of reimbursement. Still, we readily acknowledge that the exercise of determining objective intent of the parties in an ERISA case such as the one now before us, wherein the plan sponsor initially confects the plan documents unilaterally and thereafter each potential participant must either "take it or leave it" in toto, truly begs the question of bilateral intent in the usual contractual context, albeit that is the standard we must and do apply.
46
We are equally chary about ascribing the label "economic duress" to the activities of Blue Cross surrounding Whitehurst's execution of the reimbursement and subrogation portion of the standard Blue Cross acknowledgment form. Had it been necessary for us to review this issue in conjunction with the freedom of the will with which Whitehurst formed his intent, we might well have concluded that the district court clearly erred in finding (1) lack of consideration, (2) lack of understanding by Whitehurst as to the meaning of the Blue Cross form, and (3) presence of current economic pressure sufficient to constitute economic duress. We cannot ignore, for example, that Whitehurst testified that he understood the import of the form but implied that he simply did not like the result. Moreover, the district court's statement to the contrary notwithstanding, the evidence demonstrates that Whitehurst was not languishing in the hospital, physically incapacitated and highly medicated, at the time he signed the form; rather, that he was recuperating at his home and participating as an out-patient at a rehabilitation center about an hour's drive from that home. And, lastly, the record is devoid of any probative evidence that Whitehurst was under financial pressure from his medical creditors either to pay his bills or risk surcease of services. Indeed, Whitehurst's first four medical bills had already been paid by the time he signed the form, and the remaining bills were not even forwarded to Blue Cross until some time after he had signed that form. Absent such current economic pressure there could be no economic duress.
47
But the portion of the district court's opinion and holding that gives us the most serious concern is that court's admittedly res nova selection of the Make Whole rule as the appropriate default rule of construction for interpreting an ERISA plan's reimbursement and subrogation rights when and if: (1) the participant or beneficiary's recovery from other sources is partial only, (2) the plan is silent or ambiguous, (3) the plan administrator is not vested with discretionary authority to interpret the plan, and (4) the intent of the parties cannot otherwise be determined. Regardless of whether the Make Whole rule might be applicable in situations involving private insurance policies or Workers' Compensation, and irrespective of what we might be Erie-bound to hold were this a diversity case and not a federal question ERISA case, we have serious doubts whether we would ever approve or adopt the Make Whole rule as this circuit's default rule for the priority of recovery in reimbursement or subrogation between an ERISA plan and its participant or beneficiary under circumstances such as the ones we consider today.
48
To reiterate, we do not reach the questions of the intent of the parties or the appropriate default rule for reimbursement or subrogation because we find the plain language of the Plan to be unambiguous in endowing the Plan with the priority right to be reimbursed, dollar for dollar, for all benefits provided to a participant or beneficiary, to the full extent that the participant or beneficiary recovers from, inter alia, a tortfeasor or his insurer or both. Nevertheless, we emphasize that our reversal vacates in toto the district court's judgment and opinion, including, without limitation, its adoption of the Make Whole rule for purposes of construing reimbursement and subrogation rights under ERISA plans. That question remains open, presumably to be decided on another day, in another appeal, by another panel of this court.
C. Attorneys' Fees; Extent of Damages
1. Attorneys' fees
49
Both parties to this appeal sought attorneys' fees in the district court pursuant to 29 U.S.C. § 1132, and both saw their claims rejected by that court. On appeal, however, only the Plan seeks review of this aspect of the district court ruling. As a general rule, the decision to award attorneys' fees is left to the sound discretion of the trial court and will be reversed only for an abuse of discretion.27 We find no abuse of discretion by the district court here, even though on appeal we have altered the outcome of the case rather dramatically.
50
The five factors to be considered in determining whether to award attorneys' fees pursuant to section 1132(g)(1) may now have a slightly difference valence,28 yet they still augur for sustaining the district court's refusal to award attorneys' fees to the Plan. Most significantly, for purposes of this case we find essentially no evidence of culpability or bad faith on Whitehurst's part,29 and conclude that, given the district court's ruling in Whitehurst's favor, the relative merits of the parties' positions were not overwhelmingly stacked on the Plan's side. It follows that the district court's denial of the Plan's request for attorneys' fees was neither arbitrary nor capricious, and is therefore affirmed.
2. Extent of Whitehurst's Damages
51
As the final point of our analysis, we observe that on appeal the Plan also challenged the district court's additional findings--apparently articulated by that court just in case we were to determine that the Pro Rata division of Whitehurst's recovery would be appropriate--regarding the total amount of damages suffered by Whitehurst and the percentage of those damages attributable to medical expenses. As we reverse the district court's judgment in favor of Whitehurst and render judgment in favor of the Plan, recognizing its right to full, dollar-for-dollar reimbursement "off the top" of Whitehurst's recoveries from his tortfeasor and the tortfeasor's insurer, we need not and therefore do not reach the question whether the district court erred in making additional findings on the extent of Whitehurst's total damages. The matter is now moot.
III
CONCLUSION
52
We find inescapable the conclusion that our most able and conscientious colleague on the district bench erred reversibly in determining that the wording of the subrogation and reimbursement provisions of the instant SPD does not import, at least by strong and reasonable implication, the standard for determining the reimbursement priority between the Plan and the beneficiary. We conclude that, when read in context, the relevant language contemplates application of a rule for reimbursement, and that the rule thus contemplated is the Plan Priority rule. As such, we do not reach the issues of the intent of the parties or the appropriate rule of default to supply if the Plan were silent or ambiguous regarding the priority of reimbursement and the intent of the parties in that regard were not otherwise discernible. Were it necessary to determine the appropriate rule of default to supply under the circumstances presented by this case, however, we have little doubt that the Make Whole rule would not be the one we would supply.
53
For the foregoing reasons, therefore, we reverse the judgment of the district court to the extent that it denied the Plan's right to full reimbursement from the settlement funds paid to Whitehurst by his tortfeasor and the insurer of his tortfeasor; and we remand this case to that court for entry of an appropriate judgment directing Whitehurst to reimburse the Plan, dollar for dollar, for all qualifying expenditures made on his behalf, as well as for all expenditures of such nature that the Plan might make in the future, up to the full amount of Whitehurst's recoveries from his tortfeasor and the insurer of his tortfeasor. We affirm the judgment of the district court, however, to the extent it denied the requests of the Plan to be awarded attorneys' fees and costs under the provisions of 29 U.S.C. § 1132.
54
REVERSED and REMANDED in part; AFFIRMED in part.
1
29 U.S.C. § 1001 et seq
2
Some time after Whitehurst's accident and the Plan's payment of his medical benefits, Sunbeam-Oster replaced the Plan with another health benefits plan featuring an HMO
3
In itemizing the kinds of damages they suffered, the plaintiffs' complaint expressly sought recovery of all medical costs and expenses incurred in connection with Whitehurst's injuries. Specifically, it asked for $200,000 for his past and future medical expenses
4
Counsel for Whitehurst subsequently indicated to the Plan that it might only be entitled to partial reimbursement of Whitehurst's medical expenses, as Whitehurst's own recovery would likely be constrained by the policy limits of the rig owner's insurance coverage
5
See infra note 20 and accompanying text
6
This form appears to have been one of the "documents" that the General Exclusions section of the SPD required plan participants to sign if they were to avoid the exclusion for "charges for which payment or reimbursement is received by or for the individual as a result of a legal action or settlement."
7
Defendant Whitehurst also filed an Offer of Judgment pursuant to Fed.R.Civ.P. 68 proposing to allow the Plan to enter a judgment of $55,000 plus costs
8
489 U.S. 101, 115, 109 S. Ct. 948, 956-57, 103 L. Ed. 2d 80 (1989)
9
Id.; see also Cutting v. Jerome Foods, Inc., 993 F.2d 1293, 1295-96 (7th Cir.) cert. denied, 510 U.S. 916, 114 S. Ct. 308, 126 L. Ed. 2d 255 (1993)
10
Firestone, 489 U.S. at 112-13, 109 S.Ct. at 955-56
11
See Cutting, 993 F.2d at 1295-96; Baxter By and Through Baxter v. Lynn, 886 F.2d 182, 187 (8th Cir.1989); Sanders v. Scheideler, 816 F. Supp. 1338, 1342 (W.D.Wis.1993), aff'd, 25 F.3d 1053 (7th Cir.1994); Trustees of Hotel Employees and Restaurant Employees Int'l Union Welfare Fund v. Kirby, 890 F. Supp. 939, 942 (D.Nev.1995)
12
Switzer v. Wal-Mart Stores, Inc., 52 F.3d 1294, 1298 (5th Cir.1995)
13
Id.; Liberty Mutual Ins. Co. v. Pine Bluff Sand & Gravel Co., Inc., 89 F.3d 243, 246 (5th Cir.1996)
14
Switzer, 52 F.3d at 1298
15
Id. (citing Anderson v. City of Bessemer City, 470 U.S. 564 573, 105 S. Ct. 1504, 1511, 84 L. Ed. 2d 518 (1985))
16
See La. Civ.Code art. 1826; Southern Farm Bureau Cas. Ins. v. Sonnier, 406 So. 2d 178, 180-81 (La.1981) (deriving make whole policy from Civil Code sources); Smith v. Manville Forest Products Corp., 521 So. 2d 772, 775 (La.Ct.App. 2nd Cir.), writ denied, 522 So. 2d 570 (La.1988) (holding that Louisiana's make-whole policy of partial subrogation is equally applicable to reimbursement provision of health care plan)
17
FMC Corp. v. Holliday, 498 U.S. 52, 65, 111 S. Ct. 403, 411, 112 L. Ed. 2d 356 (1990); Barnes v. Ind. Auto. Dealers Ass'n of California Health and Welfare Benefit Plan, 64 F.3d 1389, 1392 (9th Cir.1995)
18
Jones v. Georgia Pacific Corp., 90 F.3d 114, 116 (5th Cir.1996) (citing Brandon v. Travelers Ins. Co., 18 F.3d 1321, 1325 (5th Cir.1994), and Todd v. AIG Life Ins. Co., 47 F.3d 1448, 1451 (5th Cir.1995))
19
A number of state court cases involving non-ERISA insurance policies have limited their recognition of an insurer's right of first priority over the insured's third party recovery to instances in which the policy contained an express, and especially detailed, reservation of such rights. See e.g., Higginbotham v. Arkansas Blue Cross & Blue Shield, 312 Ark. 199, 849 S.W.2d 464, 466 (1993); Foremost Life Ins. Co. v. Waters, 415 Mich. 303, 329 N.W.2d 688, 689 (1982); Peterson v. Ohio Farmers Ins. Co., 175 Ohio St. 34, 191 N.E.2d 157, 159 (1963); and see generally Robert E. Keeton & Alan I. Widiss, Insurance Law § 3.10(b), at 234-36 (1988)
20
29 U.S.C. § 1022(a)(1). See also Jones v. Georgia Pacific Corp., 90 F.3d 114, 116 (5th Cir.1996) (quoting Todd v. AIG Life Ins. Co., 47 F.3d 1448, 1452 n. 1 (5th Cir.1995)(although courts must construe plan terms strictly in favor of the insured when plan terms remain ambiguous after applying ordinary principles of contract interpretation, we must interpret ERISA plans themselves "in an ordinary and popular sense as would a person of average intelligence and experience")); Brewer v. Lincoln Nat'l Life Ins. Co., 921 F.2d 150, 154 (8th Cir.1990), cert. denied, 501 U.S. 1238, 111 S. Ct. 2872, 115 L. Ed. 2d 1038 (1991) (In fashioning federal common law for the construction of undefined terms in ERISA, court cited § 1022(a)(1) as indication that "[i]t would be improper and unfair to allow experts to define terms that were specifically written for and targeted toward lay persons.... [Hence] the terms should be accorded their ordinary, and not specialized, meanings.")
21
29 U.S.C. § 1021(a) & (b)
22
Given their similarity, the district court noted that the outcome of the case did not depend on which version of the Plan's subrogation and reimbursement provisions are given effect. With this we agree, although possibly for different reasons
23
As Judge Posner observed in Cutting, rejection of the Make Whole principle in favor of unequivocal subrogation or reimbursement rights has the effect of reducing the price of insurance for insureds (here the participants and their beneficiaries) and enabling the insureds to obtain more coverage, "in effect trading an uncertain bundle of tort rights for a larger certain right, which is just the sort of trade that people seek through insurance." 993 F.2d at 1298
24
"Recognition and enforcement of a right of subrogation for health insurers is primarily premised on precluding duplicative recoveries." Keeton & Widiss, supra n. 16, § 3.10(a)(7), at 231 (emphasis added)
25
We are aware that a few district courts, in confronting ERISA plan language they found to be silent or ambiguous regarding the nature or extent of a plan's subrogation or reimbursement rights in instances of a participant's partial third party recovery, have chosen, just as the district court did here, to adopt the Make Whole principle as the federal common law default rule of interpretation. See notably Sanders v. Scheideler, 816 F. Supp. 1338 (W.D.Wis.1993), aff'd, 25 F.3d 1053 (7th Cir.1994); Murzyn v. Amoco Corp., 925 F. Supp. 594 (N.D.Ind.1995). Although we acknowledge these courts' honest efforts to solve a difficult jurisprudential problem, we neither adopt their reasoning as the rule of this circuit nor write around them. We simply disagree
26
For a discussion outlining these competing common law approaches to allocation of an insured's recovery from third parties vis-a-vis the insured and an insurer with a subrogated interest, see Keeton & Widiss, supra n. 16, § 3.10(b), at 233-40. Especially noteworthy is Keeton and Widiss's conclusion that "[t]he arguments for preferring one over another of the rules of allocation are rather inconclusive in principle, and they are unsettled in the precedents." Id. at 240
27
Todd v. AIG Life Ins. Co., 47 F.3d 1448, 1458 (5th Cir.1995)
28
Those factors are: (1) the degree of the opposing parties' culpability or bad faith; (2) the ability of the opposing parties to satisfy an award of attorneys' fees; (3) whether an award of attorneys' fees against the opposing parties would deter other persons acting under similar circumstances; (4) whether the parties requesting attorneys' fees sought to benefit all participants and beneficiaries of an ERISA plan or to resolve a significant legal question regarding ERISA itself; and (5) the relative merits of the parties' position. Todd, 47 F.3d at 1458
29
The only hint of bad faith we detected came from Whitehurst's counsel's arguably duplicitous letter requesting information from the Plan to protect the Plan's interests. The district court did not find this letter sufficiently misleading to warrant penalizing Whitehurst with an assessment of attorney's fees, and we defer to its discretion on that point | 01-03-2023 | 04-17-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/2586146/ | 156 P.3d 771 (2007)
2007 UT 15
STATE of Utah, Plaintiff and Petitioner,
v.
Heather Jo RODRIGUEZ, Defendant and Respondent.
No. 20040566.
Supreme Court of Utah.
January 30, 2007.
Rehearing Denied March 28, 2007.
Mark L. Shurtleff, Att'y Gen., Matthew D. Bates, Asst. Att'y Gen., Salt Lake City, for plaintiff.
Shannon N. Romero, Lori Seppi, Salt Lake City, for defendant.
Janice L. Frost, Salt Lake City, for amici Utah Peace officers' Ass'n, Utah Sheriff's Ass'n, Dep't of Public Safety, Statewide Ass'n of Prosecutors.
NEHRING, Justice:
¶ 1 After a fatal traffic accident claimed the life of her passenger, Heather Jo Rodriguez was charged with automobile homicide. The district court denied Ms. Rodriguez's motion to suppress blood-alcohol evidence obtained in a warrantless search following the accident; the court of appeals later reversed. We granted certiorari to answer the narrow question of whether dissipation of alcohol in the blood, without more, created an exigent circumstance under the Fourth Amendment justifying the warrantless extraction of a blood sample from Ms. Rodriguez.
¶ 2 Because we found that it does not, we asked the parties to provide additional briefing on the question of whether the court of appeals correctly held that the totality of the circumstances surrounding Ms. Rodriguez's blood draw failed to create an exigency sufficient to justify a warrantless search. Having now considered both questions, we decline the invitation to assign presumptive exigent status to warrantless blood draws, but we hold that the totality of the circumstances in this case justified the extraction of blood from Ms. Rodriguez without a warrant and therefore reverse the judgment of the court of appeals.
FACTUAL AND PROCEDURAL BACKGROUND
¶ 3 Heather Jo Rodriguez was driving south on Main Street in Salt Lake City with a passenger, Terry Stewart, on May 9, 2001. Between 4:45 and 4:50 p.m., Ms. Rodriguez made an abrupt left turn into the path of an oncoming school bus. The bus broadsided Ms. Rodriguez's car, critically injuring both Ms. Rodriguez and Ms. Stewart. Paramedics arrived on the scene and transported the critically injured Ms. Rodriguez to LDS Hospital. Ms. Stewart sustained severe head injuries and was considered by paramedics to be near death. She had to be extricated from the mangled car and transported to University of Utah Medical Center.
¶ 4 When Salt Lake City police officers arrived to investigate the accident, paramedics were in the process of transporting the women to their respective hospitals. A paramedic told officers that the two women smelled of alcohol. Police officers located Ms. Stewart's purse at the scene. It contained an opened, partially-empty bottle of vodka. A supervising officer then arrived and was informed of the circumstances surrounding the accident. He immediately contacted police dispatch with instructions to send an officer to obtain a blood sample from Ms. Rodriguez that could be tested for alcohol content.
¶ 5 Dispatch directed an officer to the hospital to "witness a blood draw" from the driver. The officer first mistakenly went to the University of Utah Medical Center where he was informed that Ms. Stewart, not Ms. Rodriguez, was being treated.
¶ 6 The officer then drove to LDS Hospital where he located Ms. Rodriguez in the emergency room awaiting a CT scan. He detected evidence of inebriation, including the odor of alcohol on her breath, slurred speech, red eyes, and uncooperative and belligerent behavior.
¶ 7 The officer waited between twenty and twenty-five minutes in the CT room for a technician to arrive and draw Ms. Rodriguez's blood. The blood was taken from an IV line that the hospital staff had previously inserted into Ms. Rodriguez's arm for medical purposes. Later testing revealed that Ms. Rodriguez had a blood-alcohol level of .39, nearly five times the legal limit.
¶ 8 The passenger, Ms. Stewart, died as a result of her injuries. Ms. Rodriguez recovered and was arrested and charged with automobile homicide. Ms. Rodriguez moved to suppress the evidence obtained from the warrantless blood draw. The district court denied her motion. Ms. Rodriguez then pled guilty to the automobile homicide charge, reserving the right to appeal the district court's denial of her motion to suppress the blood evidence.
¶ 9 Before the Utah Court of Appeals, Ms. Rodriguez argued that the district court erred because the State (1) did not demonstrate that the officer had probable cause to believe she had committed an alcohol-related offense and (2) had failed to show that the *773 warrantless blood draw was justified by exigent circumstances. The court of appeals found that exigent circumstances were not present sufficient to justify a warrantless blood draw and reversed the district court. Because it decided the case on the absence of exigent circumstances, the court of appeals did not reach the issue of probable cause.
¶ 10 In support of its holding, the court of appeals noted that "exigent circumstances will be found, where the situation involves blood-alcohol evidence, only when the totality of the circumstances supports a finding that the officer was confronted with an emergency, in which the delay necessary to obtain a warrant, under the circumstances, threatened the destruction of evidence." State v. Rodriguez, 2004 UT App 198, ¶ 14, 93 P.3d 854 (citation and quotation marks omitted). The court of appeals conceded that because the human body metabolizes alcohol, its presence in the bloodstream is transitory. The court concluded, however, that the evanescent nature of blood-alcohol evidence is not sufficient, standing alone, to create an exigent circumstance justifying a warrantless intrusion into the body to take blood. Id.
¶ 11 Having declined to assign per se exigent status to blood-alcohol tests, the court of appeals looked for the presence of other circumstances which in their totality justified the seizure of Ms. Rodriguez's blood without a warrant. Looking to its own precedents, the court considered
"the distance to the nearest magistrate, the availability of a telephonic warrant, the feasibility of a stake-out or other form of surveillance while a warrant is being obtained, the seriousness of the underlying alcohol-related offense, the commission of another offense such as fleeing the scene, the ongoing and continuing nature of an investigation, the extent of probable cause, and the conduct of the investigating officers."
Id. ¶ 16 (quoting City of Orem v. Henrie, 868 P.2d 1384, 1392 (Utah Ct.App.1994)).
¶ 12 The court observed that it was "clear from the record that the decision to extract Rodriguez's blood was made soon after the accident occurred, at a time when courts are open and search warrants can be readily requested either in person or by telephone." Id. ¶ 19 (citation and quotation marks omitted). In other words, the State did not consider the feasibility of obtaining an expedited search warrant. The court of appeals found that the State presented no evidence that "anyone, at any time, had assessed the difficulty and time required to obtain a proper search warrant." Id.
¶ 13 Drawing largely on the fact that the very concept of a warrant had apparently not entered the consciousness of the police officers conducting the accident investigation, coupled with the fact that the police developed probable cause to believe that Ms. Rodriguez had been consuming alcohol at a time when the courts were open and a search warrant could have easily been requested personally or by telephone, the court of appeals held that the State failed to meet its burden of proving exigency. Id. ¶ 20.
¶ 14 In our certiorari review of the court of appeals' decision, we will first explore whether our courts may be freed from assessing the "totality of the circumstances" when faced with a Fourth Amendment challenge to a warrantless blood draw because the presence of alcohol, without more, establishes sufficient justification for the search. We will next turn to whether, in the absence of a presumptive exigency, Ms. Rodriguez's blood draw was nevertheless justified under the totality of the circumstances. We conduct both questions ceding no deference to the court of appeals. The first is a pure question of law. We review anew the second question because it concerns the proper application of constitutional guarantees against unreasonable searches and seizures. State v. Brake, 2004 UT 95, ¶ 15, 103 P.3d 699.
ANALYSIS
I. EXIGENT CIRCUMSTANCE
¶ 15 The Fourth Amendment to the United States Constitution ensures "[t]he right of the people to be secure in their persons . . . against unreasonable searches and seizures." U.S. Const. amend. IV. Reasonableness is the key to any Fourth Amendment analysis. See Pennsylvania v. *774 Mimms, 434 U.S. 106, 108-09, 98 S. Ct. 330, 54 L. Ed. 2d 331 (1977).[1] The protection afforded by the Fourth Amendment is intended to assure each individual that as a nation we prize personal dignity and privacy and will not countenance arbitrary intrusions on those valued interests. The Fourth Amendment mandates a warrant based on probable cause and reviewed by an impartial magistrate as the operational safeguard against arbitrary police intrusions. A search or seizure conducted without the aid of a warrant is per se unreasonable. See, e.g., United States v. Place, 462 U.S. 696, 701, 103 S. Ct. 2637, 77 L. Ed. 2d 110 (1983) ("In the ordinary case, the Court has viewed a seizure of personal property as per se unreasonable within the meaning of the Fourth Amendment unless it is accomplished pursuant to a judicial warrant issued upon probable cause and particularly describing the items to be seized.").
¶ 16 A reasonable warrantless search can occur only when the legitimate state interest served by the intrusion outweighs individual interests shielded by the Fourth Amendment. Delaware v. Prouse, 440 U.S. 648, 654, 99 S. Ct. 1391, 59 L. Ed. 2d 660 (1979). One class of exceptions to the warrant requirement is exigent circumstances. The words "exigent circumstances" suggest the nature of the legitimate state interest to which the exception refers: there must be an urgency to acquire evidence that falls outside the ordinary course of law enforcement. For instance, the completion of tasks associated with obtaining a warrant may place the safety of the police officers or the public at unacceptable risk or result in the destruction of essential evidence necessary to prosecute a crime. See, e.g., Camara v. Mun. Ct. of San Francisco, 387 U.S. 523, 534, 87 S. Ct. 1727, 18 L. Ed. 2d 930 (1967) (safety of the public); State v. Larocco, 794 P.2d 460, 470-71 (Utah 1990) (safety of police and risk of loss of evidence); State v. Limb, 581 P.2d 142, 144 (Utah 1978) (risk of loss of evidence).
¶ 17 The United States Supreme Court has assigned presumptive exigent circumstances status to certain classes of limited intrusions. For example, in recognition of the safety risks confronting a police officer who makes a traffic stop, the Supreme Court has authorized officers, without a warrant, to run a background check of a driver and passengers and, in addition, to order a driver and passengers out of the vehicle. See, e.g., Maryland v. Wilson, 519 U.S. 408, 410, 117 S. Ct. 882, 137 L. Ed. 2d 41 (1997) (noting that officers may order a passenger out of the vehicle); United States v. Holt, 264 F.3d 1215, 1221 (10th Cir.2001) (noting that officers may run a background check of vehicle occupants for their own safety).
¶ 18 The State contends that there is a recognized general exigency of evidence destruction which applies to warrantless blood draws. Had the United States Supreme Court held that the Fourth Amendment permits police to conduct a warrantless blood draw whenever evidence of alcohol is present, the task before us would be easy. However, the fact that it has not so held places us in the position of following a course that is part divination and part pragmatism.
¶ 19 We engage in divination when, employing what we might ambitiously call a principled approach to prophecy, we attempt to predict how the United States Supreme Court might decide the question before us. This is a perilous activity. As we will see when we take up the clearest pronouncement of the Supreme Court on the issue of alcohol and warrants, the Supreme Court could have created forty years ago the very categorical exigent circumstance rule for alcohol that the State now seeks. But it did not. We are not easily convinced that the Supreme Court has changed its mind on this question and merely awaits the appearance of the case that will permit it to make its intentions known to all.
¶ 20 Any discussion of exigency and blood-alcohol evidence takes place on terrain covered by the long shadow cast by Schmerber *775 v. California, 384 U.S. 757, 86 S. Ct. 1826, 16 L. Ed. 2d 908 (1966). Several of Schmerber's most important facts are replayed in the events here. Mr. Schmerber and his friend had been drinking at a tavern. The two individuals left the tavern in an automobile driven by Mr. Schmerber. The auto crossed the road, skidded, and struck a tree. Both Mr. Schmerber and his passenger were injured and taken to a hospital for treatment. Believing alcohol contributed to the accident, a police officer arrested Mr. Schmerber and directed a physician to draw a sample of his blood. The officer did not obtain a warrant. Id. at 758 n. 2, 86 S. Ct. 1826.
¶ 21 Presented with these facts, the Court first concluded that warrantless searches involving intrusions into the human body implicate the Fourth Amendment. Id. at 767-68, 86 S. Ct. 1826. The Court then found in such cases that "the Fourth Amendment's proper function is to constrain, not against all intrusions as such, but against intrusions which are not justified in the circumstances, or which are made in an improper manner." Id. at 768, 86 S. Ct. 1826. The Court thus rejected the notion that bodily intrusions undertaken to obtain evidence were categorically unreasonable under the Fourth Amendment and concluded that the state could penetrate a person's body to obtain evidence under certain circumstances. The challenge lay in identifying what those circumstances were.
¶ 22 The Court was satisfied that the police officer had probable cause to arrest Mr. Schmerber, but also noted that the probable cause sufficient to effect an arrest was not the same probable cause necessary to conduct a search of a person's body. This is because probable cause to conduct a search involves a concept foreign to the probable cause required to justify an arrest: the expectation of privacy.
¶ 23 The concept of "expectation of privacy" features prominently in the vocabulary of the Fourth Amendment. It functions as a tool to gauge the reasonableness of a search. The Schmerber Court acknowledged that the interest that poses the most substantial countervailing force to a community's interest in effective law enforcement is the dignity and integrity of the human body. Justice Brennan later explained Schmerber in these terms: "[t]he intrusion perhaps implicated Schmerber's most personal and deep-rooted expectations of privacy, and the Court recognized that Fourth Amendment analysis thus required a discerning inquiry into the facts and circumstances to determine whether the intrusion was justifiable." Winston v. Lee, 470 U.S. 753, 760, 105 S. Ct. 1611, 84 L. Ed. 2d 662 (1985).
¶ 24 The heightened expectation of privacy associated with the human body meant that probable cause to conduct a body search had to be grounded on something more than mere suspicion. Rather, sufficient probable cause was present only where there was a "clear indication that . . . evidence will be found." Id. at 762, 105 S. Ct. 1611 (citation and quotation marks omitted).
¶ 25 The significance assigned to the elevated expectation of privacy for one's body not only led the Court to impose a more rigorous standard for probable cause, but also prompted the Court to emphasize the importance of acquiring a warrant in advance of conducting a bodily intrusion. As the Court stated in Schmerber and reiterated in Winston:
"Search warrants are ordinarily required for searches of dwellings, and, absent an emergency, no less could be required where intrusions into the human body are concerned. . . . The importance of informed, detached and deliberate determinations of the issue whether or not to invade another's body in search of evidence of guilt is indisputable and great."
Winston, 470 U.S. at 761, 105 S. Ct. 1611 (quoting Schmerber, 384 U.S. at 770, 86 S. Ct. 1826).
¶ 26 The State holds the view that the reverse is true. The State argues that drawing blood is a significantly lesser intrusion into a person's privacy than an intrusion into a home, automobile, or non-invasive body search. This assertion misunderstands the privacy inquiry. Invasive body searches implicate the most "personal and deep-rooted" expectations of privacy, a privacy which is *776 not present in searches of homes, automobiles, or clothing. Id. at 760, 86 S. Ct. 1826.
¶ 27 That a blood draw is a minor matter in the realm of invasive procedures and one that is commonly performed does not alter the fact that it is an invasion of the human body and subject to a heightened expectation of privacy. Id. at 762, 86 S. Ct. 1826 ("The blood test procedure has become routine in our everyday life."). Justice Marshall explained this point in his dissent in Skinner v. Railway Labor Executives' Ass'n, 489 U.S. 602, 644, 109 S. Ct. 1402, 103 L. Ed. 2d 639 (1989). There, Justice Marshall reminds the Court that Schmerber does not teach that blood draws do not infringe significant privacy interests merely because they have become commonplace. The commonness, comfort, and safety of Mr. Schmerber's blood draw became relevant "only after [the Court] established that the blood test fell within the `exigent circumstances' exception to the warrant requirement, and established that the test was supported by probable cause." Skinner, 489 U.S. at 645 n. 7, 109 S. Ct. 1402 (emphasis in original).
¶ 28 We are careful to note that, although Mr. Schmerber was under arrest at the time his blood was drawn, and the Court characterized the blood draw as "an appropriate incident to [defendant's] arrest," the Court took pains to note that "the mere fact of a lawful arrest does not end our inquiry." Schmerber, 384 U.S. at 769, 771, 86 S. Ct. 1826.[2] The Schmerber Court understandably concluded that searches directed at safeguarding arresting officers "have little applicability with respect to searches involving intrusions beyond the body's surface." Id. at 769, 86 S. Ct. 1826.
¶ 29 The Court then turned its attention to the absence of a warrant. It concluded that the officers acted lawfully when they obtained the defendant's blood without a warrant because blood-alcohol content begins to drop shortly after drinking ends, time had been taken to transport the defendant to a hospital and to investigate the accident scene, and the necessity to seek out a magistrate and secure a warrant would require even more time. Id. at 770-71, 86 S. Ct. 1826.
¶ 30 Contrary to the assertion of the State, Schmerber does not stand for the proposition that the loss of evidence of a person's blood-alcohol level through the dissipation of alcohol from the body was a sufficient exigency to justify a warrantless blood draw. Rather, these three categories of "special facts" combined to create the exigency. The evanescence of blood-alcohol was never special enough to create an exigent circumstance by itself.
¶ 31 The guarded language employed by Justice Brennan to define the Court's holding in Schmerber reinforces our conclusion that the Court did not intend a categorical recognition of blood-alcohol exigency. Justice Brennan stated "[t]hat we today hold that the Constitution does not forbid the States' minor intrusions into an individual's body under stringently limited conditions in no way indicates that it permits more substantial intrusions, or intrusions under other conditions." Id. at 772, 86 S. Ct. 1826. We can uncover no endorsement of a per se rule in this statement of the Schmerber holding.
¶ 32 The Court confronted a more substantial intrusion in Winston, 470 U.S. 753, 105 S. Ct. 1611. There, the Commonwealth of Virginia sought to compel a robbery suspect to undergo surgery to remove a bullet lodged in his chest. The Court held that such surgery would be an unreasonable search under the Fourth Amendment both because extracting the bullet would intrude substantially on the suspect's privacy and security interests and because the state had failed to demonstrate a compelling need for the bullet. *777 The Court noted that in cases of intrusions below the skin, Schmerber required that several considerations be accounted for before the interests of an individual would yield to the state's interest in prosecuting a crime: (1) officials must have probable cause for the search, (2) the procedure used must be reasonable, and (3) there must be minimal intrusion upon the person's personal privacy and bodily integrity. Winston, 470 U.S. at 761-62, 105 S. Ct. 1611.
¶ 33 It is true that the Winston Court emphasized Schmerber's characterization of blood tests as minimally intrusive, in contrast to the surgical removal of the bullet from Mr. Winston. Winston, 470 U.S. at 761-62, 105 S. Ct. 1611. The Court also reaffirmed the reasonableness of blood draws, holding that a state's interest in proving alcohol impairment to enforce its drunk driving laws "was sufficient to justify the intrusion, and the compelled blood test was thus `reasonable' for Fourth Amendment purposes." Id. at 763, 105 S. Ct. 1611.
¶ 34 However, Winston involved a unique factual situation. The Court's holding demonstrates its continued adherence to the core elements of Schmerber. Id. at 761-62, 86 S. Ct. 1826. Winston did not, and because no blood draw was involved, could not, announce that warrantless blood draws to measure alcohol content were per se justified under the exigent circumstances doctrine.
¶ 35 Although the State takes pains to provide a roster of lower federal and state courts that have found that the temporary presence of alcohol in the blood creates sufficient urgency to justify a warrantless blood-alcohol test, in none of these cases was exigency established by the presence of alcohol alone. Rather, either exigency was not at issue or the court pointed to delays in the warrant acquisition process as circumstances that would suffice to create an exigency.
¶ 36 Two of the cases cited by the State come close to ceding alcohol per se exigency status: State v. Cocio, 147 Ariz. 277, 709 P.2d 1336 (1985), and State v. Bohling, 173 Wis. 2d 529, 494 N.W.2d 399 (1993). We read Cocio, however, as allowing the police to obtain, without a warrant, a portion of blood that has already been drawn from the body for other valid medical reasons. The intrusion was not, then, a governmental act. For its part, Bohling allowed a warrantless blood draw solely for the purpose of determining blood-alcohol incident to arresta state of affairs which we are not faced with today. Bohling also rested its conclusion that alcohol has obtained per se exigency status on several points with which we cannot agree. These include what we consider to be a flawed reading of Schmerber, 384 U.S. 757, 86 S. Ct. 1826, and a misapplication of Skinnera point highlighted by the Bohling dissent.[3] Furthermore, we find ourselves in agreement with the three justices of the Bohling dissent who concluded, "The legislative intent behind the telephonic warrant procedure is to encourage use of warrants and minimize resort to warrantless searches when circumstances might otherwise be exigent." Bohling, 494 N.W.2d at 408 n. 7 (citing United States v. Talkington, 843 F.2d 1041, 1046-47 (7th Cir. 1988) (citing 1977 Amendment to Federal Rule 41, advisory committee notes)).
¶ 37 We are wary of embracing holdings from other state courts that have applied the Fourth Amendment to warrantless blood-alcohol tests for a more fundamental reason. The premise that fuels the State's claim to per se exigency status for blood-alcohol tests is that owing to the evanescent quality of blood-alcohol evidence, the delays that accompany *778 the acquisition of a warrant threaten to place useful evidence beyond the reach of law enforcement. The State assumes, without evidence or authority, that the attempt to obtain a warrant where blood-alcohol evidence is sought will always be accompanied by unacceptable delay. But what if a warrant can be obtained expeditiously? We believe that there is substantial reason to believe this is possible.
¶ 38 The rules for obtaining a warrant include a minimum of universally applicable standards: the warrant must be "upon probable cause, supported by oath or affirmation, and particularly describing the place to be searched, and the persons or things to be seized." The Fourth Amendment leaves to others the details of how to go about obtaining a warrant. The astonishing advances that have marked communications and information technology over recent decades have dramatically pared back the physical obstacles to warrant acquisition.
¶ 39 Court rules and legislative enactments sometimes keep pace with this technology. Sometimes they do not. Prior to 1980, a peace officer or prosecuting attorney would be required to obtain the physical presence of a magistrate so that she might examine the complainant, take written depositions (affidavits), and sign the warrant. Utah Code Ann. § 77-54-4 (1978). This would obviously take an unacceptable amount of time in many cases. In State v. Jasso, 21 Utah 2d 24, 439 P.2d 844 (1968), we suppressed evidence where an Ogden police officer personally applied to a judge for a search warrant at his residence late at night. The judge was of the opinion that the written affidavit supplied by the officer was insufficient to issue a warrant. The judge then swore the officer as a witness and questioned him until obtaining sufficient grounds to issue a warrant based upon this oral deposition. Nonetheless, we held that the evidence later obtained should have been suppressed because the statute in effect at the time, Utah Code Ann. § 77-54-4 (1978), did not allow the issuance of a warrant from an oral deposition. Clearly, significantly more time was involved in obtaining a warrant at that time than today.
¶ 40 Over the past twenty-five years, all branches of Utah's government have participated in overseeing an evolution of the warrant acquisition process. Under current rules, police can readily obtain a warrant, in most circumstances, in a very short amount of time. As far back as 1980, Utah Code section 77-7-10 allowed a magistrate to issue a warrant by "telegraph, telephone or other reasonable means." Likewise, section 77-23-204 allowed a magistrate to consider sworn oral testimony via telephone or other reasonable means in lieu of an affidavit and allowed the magistrate to direct the requesting officer to affix the magistrate's name to the warrant in lieu of signature.
¶ 41 More recently, in 2005, the legislature revised section 77-23-204 to further streamline the process. The statute now simply states, "A remotely communicated search warrant issued under Rule 40 of the Rules of Criminal Procedure shall be served in a written form upon the person or place to be served." The new statute allows us to maintain pace with technological developments which might speed and ease the warrant process by adjustments to rule 40 of the Utah Rules of Criminal Procedurewhich rule controls the issuance of remote warrants. Currently rule 40 allows that "[a]ll communication between the magistrate and the peace officer or prosecuting attorney requesting the warrant may be remotely transmitted by voice, image, text, or any combination of those, or by other means." Utah. R. Civ. P. 40.
¶ 42 We whole-heartedly endorse the comments of the advisory committee, which state that the rule is intended to be interpreted liberally in order to facilitate remote communications as a means of applying for and issuing search warrants while preserving the integrity of the probable cause application and the terms of warrants that are authorized. We are confident that, were law enforcement officials to take advantage of available technology to apply for warrants, the significance of delay in the exigency analysis would markedly diminish.
¶ 43 Case law in this area is of little help. It is virtually impossible to extract from blood-alcohol related Fourth Amendment *779 cases a meaningful understanding of the standard against which the court is measuring delay. Were telephonic warrants available? We are seldom told. Yet, we know that the delay associated with telephonic warrants need not be great. See United States v. Baker, 520 F. Supp. 1080, 1083 (D.Iowa 1981) (finding that one hour and fifteen minutes was "abundant time" to obtain warrant by telephone, a process that often takes no more than thirty minutes). We also know that "the Mesa Police Department is able to obtain a warrant within as little as fifteen minutes and that delays of only fifteen to forty-five minutes are commonplace." State v. Flannigan, 194 Ariz. 150, 978 P.2d 127, 131 (App.1998). The record in this case does not disclose how much time would likely have been required for the officers to secure a warrant to extract Ms. Rodriguez's blood. We are confident, however, that courts and law enforcement officials in Utah, particularly in our urban regions, would have the wherewithal to duplicate the warrant acquisition standards of Mesa, Arizona. We agree with the sentiment of that case: "The mere possibility of delay does not give rise to an exigency." Id.
¶ 44 Was a magistrate readily available to review the warrant application? If not, why not? In Schmerber, the most definitive commentary by the United States Supreme Court on the subject of warrants, exigent circumstances and blood-alcohol tests, the Court tells us that the police officer was required to appear before a magistrate and implies that magistrates were not particularly easy to locate. 384 U.S. 757, 86 S. Ct. 1826. In 1966, the Justices of the Supreme Court could not reasonably have foreseen the ubiquity of the cell phone, and only those conversant with the futuristic imaginings of science fiction would have been capable of describing the gadgetry that equips the interior of the typical police cruiser today.
¶ 45 Nor could the Court in 1966 have foreseen the evolution of law enforcement sophistication and professionalism that has occurred over the past forty years. The United States Supreme Court recently took note of this important development when it ended the application of the exclusionary rule as a sanction for violations of a police officer's obligation to knock and announce his presence before entering a dwelling to execute a warrant. Hudson v. Michigan, ___ U.S. ___, 126 S. Ct. 2159, 165 L. Ed. 2d 56 (2006). Writing for a majority of the Court, Justice Scalia observed:
Another development over the past half-century that deters civil-rights violations is the increasing professionalism of police forces. . . . Numerous sources are now available to teach officers and their supervisors what is required of them under this Court's cases, how to respect constitutional guarantees in various situations, and how to craft an effective regime for internal discipline.
Id. at 2168.
¶ 46 Were we to adopt a rule of per se exigency for alcohol-related blood seizures, we would remove much of the incentive to pursue progressive approaches to warrant acquisition that preserve the protections afforded by the warrant while meeting the legitimate interests of law enforcement. Today, Utah Rule of Criminal Procedure 40 exploits communications and information technology in the cause of making warrants more readily obtainable without compromising the core constitutional considerations of authenticity and impartiality. In most cases, a police officer has readily at hand several methods of applying for a search warrant from the scene of an accident, a medical facility, or any other location where probable cause has been established.
¶ 47 The State takes issue with the court of appeals' disapproving reaction to the fact that the officer who authorized the warrantless seizure of Ms. Rodriguez's blood never considered obtaining a warrant. The State appears to hold the view that a per se exigency rule is necessary in part because the typical police officer could not be expected to successfully complete an evaluation of the array of considerations that together comprise the "totality" of circumstances upon which a judgment about a warrant is made.
¶ 48 The court of appeals noted that the officer viewed the blood draw merely as a routine matter in the aftermath of an alcohol-related accident. The State is on target *780 when it notes that the officer's subjective belief is not relevant to an assessment of the reasonableness of his actions and also misses the point of the court's reference to the officer's absence of warrant awareness. It is clear to us that the court was disturbed by what the record suggests to be an instance of institutional disregard of a fundamental constitutional safeguard of individual rights: the warrant.
¶ 49 A police officer who has not even considered the potential need for a warrant will not, of course, be required to possess any skill or sensitivity in identifying and evaluating the state of the actual exigencies that confront him. Amici curiae suggest that it might be too much to ask a police officer to investigate every alcohol-related incident with the presumption that a blood draw must be supported by a warrant. Amici contend there is simply too much for a police officer to do and to think about to realistically expect the officer to take on the added burden of evaluating the availability of a warrant. This court, like the court of appeals, is confident that the law enforcement officers of this state are suitably equipped with the talent, training, and experience to permit them to exercise sound judgment when they conclude that an investigation would benefit from the acquisition of blood-alcohol evidence.
¶ 50 Finally, we believe that destruction of evidence brought on by the involuntary metabolic processes of the human body presents a less compelling case for exigency than do more traditional and volitional methods of evidence destruction. There exists considerable scientific literature on the subject of whether reliable conclusions about blood-alcohol concentrations at a prior time may be extrapolated from a test performed on blood drawn later. The State and amici cite numerous articles that question the reliability and utility of retrograde analysis of blood-alcohol evidence. Ms. Rodriguez counters with her own substantial bibliography. Who has the better science is not the question here. The fact that there has been serious scientific inquiry attempting to develop reliable methods to calculate past blood-alcohol concentrations is what is important. The same could not be said for more commonplace forms of evidence destruction, the use of toilets being the most prominent among them. We are unwilling to render ongoing scientific research into blood-alcohol dissipation rates irrelevant by bestowing categorical exigency status on seizures of blood.
II. THE TOTALITY OF THE CIRCUMSTANCES JUSTIFIED THE WARRANTLESS DRAW OF MS. RODRIGUEZ'S BLOOD
¶ 51 Whether exigent circumstances are present to justify a warrantless intrusion depends on "all of the circumstances surrounding the search or seizure and the nature of the search or seizure itself." United States v. Montoya de Hernandez, 473 U.S. 531, 537, 105 S. Ct. 3304, 87 L. Ed. 2d 381 (1985). Applying the exigency assessment guideposts set out in City of Orem v. Henrie, 868 P.2d 1384, 1388 (Utah Ct.App.1994), the court of appeals held that the blood draw failed the totality of the circumstances test. Our own review of the facts surrounding the blood draw compels us to the opposite conclusion reached by the court of appeals. This outcome is the result of balancing the state's interest in collecting evidence against the defendant's interests in privacy and bodily integrity.
¶ 52 The court of appeals concluded that the totality of the circumstances fell short of meeting the State's obligation to show exigent circumstances which justified its warrantless blood draw. It did credit the district court for taking into account the inherent dissipation of alcohol in the blood, the seriousness of the accident, and the clear presence of probable cause to believe that alcohol contributed to the accident.
¶ 53 Nevertheless, the court of appeals found the district court's failure to account for the question of time, the proximity of the magistrate, the alternatives explored and discarded by the officers, the delay the officers faced, the impact of the delay in obtaining viable evidence, and the point of time in the accident investigation when the decision was made to extract Ms. Rodriguez's blood was fatal to the trial court's totality of the circumstances analysis. State v. Rodriguez, 2004 UT App 198, ¶ 17, 93 P.3d 854. In sum, the *781 court of appeals appeared to focus its attention on the fact that the officers never considered applying for a warrant, much less exploring or discarding alternative courses of action.
¶ 54 We do not disregard this roster of relevant considerations compiled by the court of appeals. Each has its place in contributing to a clear understanding of what a reasonable officer would have apprehended at the time Ms. Rodriguez's blood draw occurred. See, e.g., Ohio v. Robinette, 519 U.S. 33, 39, 117 S. Ct. 417, 136 L. Ed. 2d 347 (1996). We are dismayed by the officers' failure to consider the notion that the extraction of blood from a person's body might constitute a search requiring a warrant. In light of the confidence expressed earlier in this opinion in the evolving professionalism of the law enforcement officials who participated in Ms. Rodriguez's blood draw, we consider the major constitutional blind spot that this incident exposed disturbing.
¶ 55 We do not, however, agree with the court of appeals that the officers' belief that warrantless blood extractions were routine dooms the State's quest for exigency. Although we are concerned that the officers did not consider the warrant requirement, the subjective assessment about the need for a warrant is largely irrelevant to our totality of the circumstances analysis. It is an objective analysis in which the thought processes of any particular officer plays no role.
¶ 56 We also have misgivings about the certainty with which the court of appeals concluded that the decision to extract Ms. Rodriguez's blood was made at a time "when courts are open and search warrants can be readily requested." Rodriguez, 2004 UT App 198, ¶ 19, 93 P.3d 854. It is not clear to us that this assertion can be credibly derived from the agreed-upon fact that the accident occurred between 4:45 and 4:50 p.m. on a Wednesday.
¶ 57 Although we know that no one considered requesting a warrant before drawing Ms. Rodriguez's blood, the record reveals much about what the officers understood regarding the accident and Ms. Rodriguez's condition from the time the collision occurred until the time Ms. Rodriguez's blood was drawn. One fact dominates all others with respect to its relevance to whether the warrantless blood draw was reasonable: that Ms. Stewart was expected to succumb to her injuries. This fact significantly altered the warrant acquisition calculus that a reasonable law enforcement officer who has probable cause to believe an alcohol-related offense has occurred could be expected to apply. The severity of the possible alcohol-related offense bears directly on the presence or absence of an exigency sufficient to justify a blood draw without a warrant.
¶ 58 In this sense, warrantless blood draws are never "routine." Without the presence of other compelling circumstances, a law enforcement official who stopped a pedestrian suspected of public intoxication would not face an exigency sufficient to justify a warrantless blood draw. In such cases, the state has a negligible interest in acquiring the quality of alcohol evidence provided by a blood test uncompromised by considerations of dissipation during the warrant application process. Where an alcohol-related offense is minor, a warrantless blood draw, however modest it may be in the spectrum of bodily intrusions, will trespass on important constitutional rights.
¶ 59 Even where, as here, the alcohol-related offense is very serious, a warrantless blood draw cannot be "routine." Here, the evidence supporting the conclusion that probable cause existed to believe that Ms. Rodriguez was intoxicated at the time of the accident was overwhelming. Not only was a vodka bottle found at the scene, but the officer noted her slurred speech, bloodshot eyes, and odor of alcohol when he encountered Ms. Rodriguez at the hospital. The likelihood that the blood draw would detect alcohol was great. We agree with the district court that the seriousness of the accident coupled with the compelling evidence of Ms. Rodriguez's alcohol impairment is sufficient to establish that the interests of law enforcement outweighed, in this instance, Ms. Rodriguez's privacy interests.
¶ 60 In making what we believe to be the "discerning inquiry" into the justifications for the intrusion mandated by Justice Brennan *782 in Winston v. Lee, 470 U.S. 753, 760, 105 S. Ct. 1611, 84 L. Ed. 2d 662 (1985), we have not cast aside the Henrie factors that the court of appeals applied to reach a result contrary to ours. As our rejection of the State's quest for per se exigency makes clear, practical considerations associated with warrant acquisition remain central to inquiries into whether exigent circumstances justify a warrantless search. As technology reduces the amount of time necessary to obtain a warrant, we would expect a corresponding increase in the use of warrants.
¶ 61 Our result today is the product of our judgment that in this case the facts relating to the Henrie factors were subordinate to considerations of the severity of the accident and attendant offense and the obvious presence of Ms. Rodriguez's alcohol impairment as a contributing cause of Ms. Stewart's death.
CONCLUSION
¶ 62 In light of the foregoing, it is difficult for us to imagine that the United States Supreme Court could muster the assurance that the consequences of alcohol dissipation are so great and the prospects for prompt warrant acquisition so remote that per se exigent circumstance status be awarded to seizures of blood for the purpose of gathering blood-alcohol evidence. Accordingly, we decline to grant per se exigent circumstance status to warrantless seizures of blood evidence. However, it is our opinion that the State did meet its obligation in this case to show that under the totality of the circumstances, both probable cause and exigent circumstances justified its warrantless blood draw.
¶ 63 Chief Justice DURHAM, Associate Chief Justice WILKINS, Justice DURRANT, and Justice PARRISH concur in Justice NEHRING's opinion.
NOTES
[1] Article I, section 15 of the Utah Constitution likewise guarantees the citizens of our state freedom from unreasonable searches and seizures. We have, however, not been invited to take up the question presented under the Utah Constitution. We therefore once again postpone an analysis of the substantive differences, if any, between the respective search and seizure provisions of the United States and Utah Constitutions.
[2] The Court apparently did not intend to ascribe legal significance to its "incident to arrest" labeling of the Schmerber blood draw. In Winston v. Lee, the Court noted that Schmerber "fell within the exigent circumstances exception to the warrant requirement." 470 U.S. at 759, 105 S. Ct. 1611. The Court's use of the "search incident to arrest" justification for the warrantless search in Schmerber has spawned considerable debate over whether an actual arrest must precede a warrantless blood draw or whether a showing of probable cause for arrest will suffice. See State v. Blank, 90 P.3d 156, 161, 163 n. 41 (Ala.2004) (listing jurisdictions that have adopted categorical exigent circumstances rule). Here, the State has advanced the sole argument that the blood draw was justified under the exigent circumstance rationale.
[3] Skinner v. Railway Labor Executives' Ass'n, 489 U.S. 602, 623, 109 S. Ct. 1402, 103 L. Ed. 2d 639 (1989), does not establish, as the Wisconsin court asserts, that exigent circumstances are present whenever public safety is furthered through procurement of a blood sample. Skinner approved federal regulations mandating warrantless blood and urine tests of railroad employees following rail accidents. The decision was not based, however, on principles applicable to the investigation of crimes.
The Court emphasized that the usual warrant and individualized suspicion rules in criminal cases were inapplicable to the administrative testing of railroad employees because the testing of railroad employees was not mandated to assist in the prosecution of employees but rather to prevent accidents and casualties in railroad operations that result from impairment of employees by alcohol or drugs.
State v. Bohling, 173 Wis. 2d 529, 494 N.W.2d 399, 408 n. 9 (1993) (Abrahamson, J., dissenting) (quotation marks omitted). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/312241/ | 481 F.2d 326
R. H. FULTON d/b/a R. H. Fulton, Contractor, Plaintiff-Appellant,v.CHICAGO, ROCK ISLAND AND PACIFIC RAILROAD COMPANY,Defendant-Appellant-Appellee,andSoo Line Railroad Company, Defendant-Appellee (two cases).
Nos. 72-1344, 72-1376.
United States Court of Appeals,Eighth Circuit.
Submitted March 14, 1973.Decided April 27, 1973.Rehearing and Rehearing En Banc Denied June 4, 1973.
George C. Chapman, Dallas, Tex., for Fulton, etc.
Wendell E. Koerner, Jr., St. Joseph, Mo., for Soo Line.
Thad C. McCanse, Kansas City, Mo., for Chicago, Rock Island & Pacific R. R. Co.
Before MATTHES, Chief Judge, and ROSS and STEPHENSON, Circuit Judges.
MATTHES, Chief Judge.
1
This case stems from the damages accruing to the shipper, R. H. Fulton, from the derailment of a train transporting his equipment. Fulton appeals from the judgment entered upon jury verdicts for the originating carrier, Soo Line Railroad [Soo] and a connecting carrier, Chicago, Rock Island & Pacific Railroad [Rock Island]. Rock Island has also appealed from the judgment entered upon a jury verdict for Fulton on Rock Island's counterclaim.
2
Fulton is a pipeline contractor who, upon completing a job in Minnesota, contracted with Soo to transport his equipment from Thief River Falls, Minnesota, to the Southwest. Flat cars were diverted to a siding where Fulton's employees, under the supervision of Soo's inspector, loaded the equipment onto the cars and secured it for transit. It was and is a hotly contested question whether Soo's employee was an active supervisor or passive inspector. Also during the loading, a safety bolt was omitted from the counterweight rack despite a warning plate on the machine that the bolts should be inserted before transporting the machine. According to controverted evidence, this could have allowed the rack to drift out in transit. However, it was also hotly contested whether this caused the accident, or whether the cause was loose cabling of the equipment allowing the entire machine to shift.
3
After Soo's inspection "bad ordered" two cars for loose cabling, the other eight departed Thief River Falls. At Minneapolis, Soo connected with a nonparty carrier, the Minneapolis, Northfield and Southern Railway, which transported the cars to a connection with Rock Island at Northfield, Minnesota.
4
Rock Island was to transport the cars to a connection with the terminating carrier, the Southern Pacific, but, unbeknownst to the crew, one of the cars carrying Fulton's equipment struck the Mill Grove Bridge near the terminal point at Trenton, Missouri. After a rollby inspection at night at Trenton resulted in no discovery of anything amiss, a new Rock Island crew departed Trenton, but after a few miles a machine on the third of Fulton's cars struck Bridge 4194 causing the derailment and the collapse of the bridge.
5
Fulton then filed this suit1 against Rock Island2 and filed an amended complaint also naming Soo. The complaint laid two counts against each carrier, one under the Carmack Amendment, 49 U.S. C. Sec. 20(11), and one in common law negligence. Rock Island counterclaimed for the damages to its bridge.
6
Soo initially moved to quash service, contending Fulton's attempt to effect service through the Missouri long arm statute was ineffectual to confer personal jurisdiction over Soo in this cause. After a hearing at which Fulton showed Soo's activity in the loading, the court denied the motion and held the service conferred jurisdiction. Fulton v. Southern Pac. Co., 320 F. Supp. 45 (W.D.Mo. 1970). However, when the cause was submitted, the court declined to submit the Carmack Claim against Soo, apparently on the theory that the long arm service was adequate only as to the negligence count.
7
The primary issue of fact litigated at trial was the cause of the accident. While Fulton did not deny that the safety bolt was omitted, it contended the counterweight nevertheless would not drift and that the cause of the accident was faulty cabling pursuant to Soo's instructions allowing the load to shift and the failure of Rock Island to observe these errors upon inspection. Alternatively, Fulton contended Soo was responsible for the loading and thus was responsible for the omission of the safety bolt, and that Rock Island was contributorily negligent in not observing the missing bolt and not taking ordinary precautions for a wide load which would have revealed the counterweight had drifted. The carriers, of course, insisted Fulton was at fault for omitting the safety bolt, that they had conducted their inspections with ordinary care, and that the drifting counterweight caused the accident.
8
After a five week trial, the case went to the jury. After one day's deliberation, the jury requested and received further explanation of the verdict form allowing them to find for Rock Island on Fulton's claim and for Fulton on Rock Island's counterclaim. Neither party had previously objected to this verdict form as inconsistent and neither objected to it at this time. Shortly thereafter the jury returned a verdict for Soo on the single limited negligence count submitted to them as to Soo and announced they were deadlocked on the Fulton-Rock Island claims. The court thereupon charged them to try again to reach a verdict and, after further deliberation, the jury returned a verdict on the form they earlier sought to have explained. Consequently, Judge Duncan entered judgment for Fulton on Rock Island's counterclaim and for the carriers on Fulton's claims. The court denied the posttrial motions by Fulton and Rock Island for judgment n. o. v. and by Fulton for a new trial, and these appeals followed.
I. FULTON'S APPEAL AS TO SOO
9
As noted above, Fulton's amended complaints naming Soo as a defendant pleaded causes of action against Soo both under the Carmack Amendment and in common law negligence, but the trial court declined to submit the Carmack issue to the jury. While we are directed to no precise statement in the record that this ruling stemmed from a conclusion the court possessed in personam jurisdiction as to the negligence count but not as to the Carmack claim, that apparently was the court's decision because the only reason pressed by Soo to pretermit submission of the claim to the jury was its contention the court lacked in personam jurisdiction.3 Indeed, since Soo clearly comes within the plain language of the Carmack Amendment even if it was not itself negligent,4 personal jurisdiction is the only theory we can ascribe to support the ruling. Accordingly, we turn to that question.
10
Fulton made service pursuant to Rule 4(e), Fed.R.Civ.P., by utilizing the provisions of the Missouri long arm statute, Sec. 506.500 V.A.M.S. That statute provides:
11
"506.500. Actions in which outstate service is authorized
12
1. Any person or firm, whether or not a citizen or resident of this state, or any corporation, who in person or through an agent does any of the acts enumerated in this section, thereby submits such person, firm, or corporation, and, if an individual, his personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any of such acts:
13
(1) The transaction of any business within this state;
14
(2) The making of any contract within this state;
15
(3) The commission of a tortious act within this state;
16
(4) The ownership, use, or possession of any real estate situated in this state;
17
(5) The contracting to insure any person, property or risk located within this state at the time of contracting.
18
2. Only causes of action arising from acts enumerated in this section may be asserted against a defendant in an action in which jurisdiction over him is based upon this section."
19
Soo contends that because it made and performed this contract outside Missouri and owns no Missouri trackage the only long arm provision possibly applicable to this case is Sec. 506.500(1)(3): "The commission of a tortious act within this state [Missouri]." Soo then advances two alternative arguments why this subsection is also inapplicable.
20
First, Soo submits the language of the subsection limits its application to actions occurring within the boundaries of Missouri. Pointing out that its allegedly tortious conduct-loading the railcars -occurred in Minnesota, Soo concludes the provision is inapplicable.
21
Second, Soo aserts Fulton's common law negligence claim is preempted by the Carmack Amendment, leaving only his Carmack count as stating a viable claim. Soo then asserts the Carmack count rests on the interstate contract of carriage, that it therefore sounds in contract rather than tort, and therefore that Sec. 506.500(1)(3) is inapplicable.
22
In addition, Soo contends that even if Sec. 506.500 is not inapplicable by its own interpretation, the exercise of personal jurisdiction in this case would contravene due process because Soo does not have the required "minimum contacts" with Missouri. We shall discuss these seriatim.
23
First, Judge Duncan was clearly correct in holding that Missouri caselaw construes the phrase "commission of a tortious act within this state" to include extraterritorial acts producing actionable consequences in Missouri. Missouri ex rel. Deere & Co. v. Pinnell, 454 S.W.2d 889 (Mo.Sup.Ct.1970) (en banc); Missouri ex rel. Apco Oil Co. v. Turpin, 490 S.W.2d 400 (Mo.App.1973). Accord, Buckley v. New York Post Corp., 373 F.2d 175 (2nd Cir. 1967); Gray v. American Radiator & Standard Sanitary Corp., 22 Ill. 2d 432, 176 N.E.2d 761 (1961); Ehlers v. United States Heating & Cooling Mfg. Corp., 267 Minn. 56, 124 N.W.2d 824 (1963). Contra, Longines-Wittnauer Watch Co. v. Barnes & Reinecke, Inc., 15 N.Y.2d 443, 209 N.E.2d 68, 78-81, cert. denied, sub nom, Estwing Mfg. Co. v. Singer, 382 U.S. 905, 86 S. Ct. 241, 15 L. Ed. 2d 158 (1965). It is therefore irrelevant to the statute's applicability that Soo's overt activity was confined to Minnesota.
24
As to Soo's second alternative argument, we agree that the Carmack Amendment has preempted suits in specific negligence by holders of bills of lading against their carriers. American Synthetic Rubber Corp. v. Louisville & N. R. R. Co., 422 F.2d 462, 468 (6th Cir. 1970)."Congress must be deemed to have determined that the rule laid down and the means provided to enforce it are sufficient and that no other regulation is necessary. Its power to regulate such commerce and all its instrumentalities is supreme; and, as that power has been exerted, state laws have no application. They cannot be applied in coincidence with, as complementary to or as in opposition to, federal enactments which disclose the intention of Congress to enter a field of regulation within its jurisdiction." Missouri Pac. R. R. Co. v. Porter, 273 U.S. 341, 345-346, 47 S. Ct. 383, 385, 71 L. Ed. 672 (1927).
25
See especially Adams Express Co. v. Croninger, 226 U.S. 491, 33 S. Ct. 148, 57 L. Ed. 314 (1913). See also New York, N. H. & H. R. R. Co. v. Nothnagle, 346 U.S. 128, 73 S. Ct. 986, 97 L. Ed. 1500 (1953); Southeastern Express Co. v. Pastime Amusement Co., 299 U.S. 28, 57 S. Ct. 73, 81 L. Ed. 20 (1936); Chicago & N. Ry. Co. v. C. C. Whitnack Produce Co., 258 U.S. 369, 42 S. Ct. 328, 66 L. Ed. 665 (1922); Atchison, T. & S. F. Ry. Co. v. Harold, 241 U.S. 371, 36 S. Ct. 665, 60 L. Ed. 1050 (1916); Atchison, T. & S. F. Ry. Co. v. Robinson, 233 U.S. 173, 34 S. Ct. 556, 58 L. Ed. 901 (1914); Boston & M. R. R. v. Hooker, 233 U.S. 97, 34 S. Ct. 526, 58 L. Ed. 868 (1914); W. D. Lawson & Co. v. Penn Central Co., 456 F.2d 419 (6th Cir. 1972). We regard the Lawson decision as squarely in point with this case on the preemption issue. But see Litvak Meat Co. v. Baker, 446 F.2d 329 (10th Cir. 1971).
26
"The cases make it clear that when damages are sought against a common carrier for failure to properly perform, or for negligent performance of, an interstate contract of carriage, the Carmack Amendment governs." American Synthetic Rubber Corp. v. Louisville & N. R. R. Co., supra, 422 F.2d at 466.
27
However, it does not follow as a consequence of finding Fulton's common law suit preempted that the remainder of Soo's second jurisdictional argument is well taken. Indeed, there are two alternative and independent lines of reasoning yielding the conclusion that the Missouri long arm statute nevertheless applies to Fulton's Carmack claim.
28
First, contrary to Soo's contention, it is not necessary to characterize the Carmack claim as a cause of action in tort for the statute to apply. Concededly, Sec. 506.500(1)(3) is limited to service upon one who has committed "tortious" conduct, and subsection (2) does limit service to a "cause of action arising from" that conduct; but it does not follow that the cause of action must sound in tort. The statute says it applies "to any cause of action arising from the doing of such acts" and the Missouri courts have construed that phrase literally.
29
In Missouri ex rel. Apco Oil Co. v. Turpin, supra, 490 S.W.2d 400 (Mo. App.1973), a retailer defending a products liability action brought a third party complaint against the manufacturer for indemnity and served process pursuant to Sec. 506.500. The manufacturer sought to quash service on the grounds, inter alia, that while a consumer suit against it for the negligent manufacture would sound in tort, the suit for indemnity did not and therefore fell without the coverage of Sec. 506.500(1)(3). The Missouri Court of Appeals, St. Louis Division, rejected this contention, Judge Simeone saying:
30
"It is really immaterial for the purposes of the 'long arm statute' whether the tortious act is deemed committed against General Woodcraft [the consumer] or Apco [the retailer] for the reason that the statute authorizes extraterritorial service whenever a tortious act is committed 'within this state' and the cause of action arises from its commission. . . . It is really of no significance as to what the cause of action is between Apco and Noury [the manufacturer] as long as that cause of action arises from the commission of a tortious act in Missouri."490 S.W.2d at 405, 407 (emphasis supplied).
31
Clearly then the cause of action under Carmack need not be characterized as tort to come within Sec. 506.500(1)(3) so long as it arises from "the commission of a tortious act." It is true, of course, that the preemption of common law claims against carriers makes the "tortious act" relied on here not actionable as a common law tort, but that is not a material problem. In view of the thrust of the Apco opinion, we think it sufficient that Soo's conduct gives rise to a cause of action in damages.
32
Furthermore, even if Sec. 506.500(1)(3) were applicable only if the cause of action sued on sounded in tort, we think it would apply to Fulton's Carmack claim because such a claim does indeed sound significantly in tort. It is of course true that the relationship between a shipper and carrier is initiated by the contract of carriage and it is equally true the relationship is highly analogous to bailment. But it is clear the liability of the carrier does not rest upon these factors. The duty of the carrier is erected by the statute, not by the contract, and the parties are not free to alter that duty by their contract. Thus, the liability arises not from breach of the contract but from breach of the statutory duty, and "[w]here a contractual relationship exists between persons and at the same time a duty is imposed by or arises out of the circumstances surrounding or attending the transaction, the breach of the duty is a tort." 52 Am.Jur. Sec. 26 p. 379. See also id. at Secs. 27-28.
33
Indeed, the nature of the carrier's duty under the Carmack Amendment sounds in negligence. The carrier's duty in the carriage of cargo is due care, see e. g., Watson Bros. Transp. Co. v. Feinberg Kosher Sausage Co., 193 F.2d 283 (8th Cir. 1951); Seaboard Air Line R. R. Co. v. Lake Region Packing Assoc., 211 So. 2d 25 (Fla.App.), cert. denied, 221 So. 2d 748 (Fla.1968); it cannot exculpate itself "from loss or responsibility due to negligence," Missouri, K. & T. Ry. Co. v. Harriman, 227 U.S. 657, 672, 33 S. Ct. 397, 401, 57 L. Ed. 690 (1913); the carrier bears a heavy burden of proof akin to res ipsa loquitur because it has peculiarly within its knowledge the facts which may relieve it of liability, Missouri Pac. R. R. Co. v. Elmore & Stahl, 377 U.S. 134, 143-144, 84 S. Ct. 1142, 12 L. Ed. 2d 194 (1964); Lux Art Van Serv., Inc. v. Pollard, 344 F.2d 883 (9th Cir.), cert. denied, 382 U.S. 837, 86 S. Ct. 85, 15 L. Ed. 2d 80 (1965), but it is liable under the statute only for damage "caused by" it and therefore can escape liability by proving the damage was due to an excepted cause and "that it was free from negligence. . . ." Missouri Pac. R. R. Co. v. Elmore & Stahl, supra, 377 U.S. at 138, 84 S. Ct. at 1145. Thus,
34
"[d]espite the divergent language in the various cases, it is clear that the duty therein sought to be imposed on the common carrier with respect to transportation and delivery of goods is based on the law of negligence." Seaboard Air Line R. R. Co. v. Lake Region Packing Assoc., supra, 211 So. 2d at 27-28.
35
Accord, United States v. Reading Co., 289 F.2d 7 (3rd Cir. 1961); Skulina, Liability of a Carrier for Loss and Damage to Interstate Shipments, 17 Cleve-Mar.L.Rev. 251, 255 (1968). See Watson Bros. Transp. Co. v. Feinberg Kosher Sausage Co., supra. Accordingly, a cause of action under the Carmack Amendment sounds in tort.
36
In sum, we hold, independently and alternatively, that for service under Sec. 506.500(1)(3) to be effective it is not necessary that the cause of action pleaded sound in tort, and that even if it were, this Carmack cause of action would be covered because it sounds in tort. Therefore, the service here was statutorily authorized. We turn then to the question whether exercise of the jurisdiction conferred by that statute is constitutionally permissible in this case.5
37
The precise question now posed is the constitutionality of exercising personal jurisdiction over a foreign corporation whose only contact with the forum state is a single extraterritorial act causing actionable consequences within the forum state. The constitutional question, of course, is governed by the three leading Supreme Court cases, Hanson v. Denckla, 357 U.S. 235, 78 S. Ct. 1228, 2 L. Ed. 2d 1283 (1958); McGee v. International Life Ins. Co., 355 U.S. 220, 78 S. Ct. 199, 2 L. Ed. 2d 223 (1957); International Shoe Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945).
38
In International Shoe the Court broke with the past and laid down this now familiar rule,
39
"[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice."'
40
326 U.S. at 316, 66 S. Ct. at 158. The Court also held the minimum contacts "criteria . . . cannot be simply mechanical or quantitive, . . . [but] must depend rather upon the quality and nature of the activity. . . ." Id. at 319, 66 S.Ct. at 160. Accordingly, the Court said,
41
"the commission of some single or occasional acts of the corporate agent in a state sufficient to impose an obligation or liability on the corporation, . . . because of their nature and quality and the circumstances of their commission, may be deemed sufficient to render the corporation liable to suit."
42
Id. at 318, 66 S.Ct. at 159.
43
The Court followed this holding in McGee, where it approved service upon a nonresident insurance company whose only contact with the forum state was sending a form of reinsurance to, and receipt of premiums from, its one policyholder in the state whom it acquired when it absorbed his original insurer. Then in Hanson, the Court added a caveat:
44
"[I]t is a mistake to assume that this trend heralds the eventual demise of all restrictions on the personal jurisdiction of state courts. Those restrictions are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective States."
45
357 U.S. at 251, 78 S. Ct. at 1238.
46
Taking these three cases together, we reject Soo's contention the exercise of jurisdiction upon a "single act" is constitutionally impermissible.
47
"[I]t would not be difficult to extrapolate from the McGee decision and opinion a general principle that the due process clause imposes no bar to a state's asserting personal jurisdiction, of course on proper notice, in favor of a person within its borders who suffers damage from the breach of a contract the defendant was to perform there or a tort the defendant committed there. . . . [S]uch a doctrine would not seem to violate basic notions of fair play. . . . Indeed, when [as here,] the operative facts have occurred where the plaintiff sues, the convenience of both parties would often be served by a trial there. . . . Unfairness inconsistent with notions of fair play occurs only when a defendant is 'compelled to defend himself in a court of a State with which he has no relevant connection.' And inflicting harm within a state would appear to meet whatever further constitutional requirement may arise from [the] 'territorial limitations on the power of the respective States' [referred to in] Hanson v. Denckla." Buckley v. New York Post Corp., supra, 373 F.2d at 181 (Friendly, J.) (citations omitted).
48
Accord, Southern Machine Co. v. Mohasco Industries, Inc., supra; Elkhart Engineering Corp. v. Dornier Werke, 343 F.2d 861, 865-868 (5th Cir. 1965); Missouri ex rel. Deere & Co. v. Pinnell, supra; Missouri ex rel. Birdsboro Corp. v. Kimberlin, 461 S.W.2d 292 (Mo.App. 1970). Cf. Hess v. Pawloski, 274 U.S. 352, 47 S. Ct. 632, 71 L. Ed. 1091 (1927) (motorist's single act).
49
Bearing in mind the injunction of International Shoe that we judge the contacts qualitatively rather than quantitatively, we find no difficulty in holding Soo's role as initiating carrier provides the requisite minimum contacts. As initiating carrier, Soo knew the cargo would traverse Missouri and the derailment occurred there allegedly through Soo's negligence. Surely this provides a "relevant connection" with Missouri. Furthermore, the fairness of a Missouri forum is shown by the fact it is the situs of the accident. Indeed, the Texas District Court transferred the cause to Missouri pursuant to 28 U.S.C. Sec. 1404 and the Missouri court then declined a similar transfer to Minnesota. The dual test of constitutionality is therefore met.
50
In sum, we find the district court had personal jurisdiction over Soo for the Carmack claim, the service of process being statutorily and constitutionally valid. It was therefore error not to submit that count to the jury. Accordingly, we reverse and remand for retrial of Fulton's Carmack claim against Soo. In view of the fact that all of Fulton's other assignments of error vis-a-vis Soo relate to the common law count now held preempted, we pretermit discussion of those contentions.
II. FULTON'S APPEAL AS TO ROCK ISLAND
51
In pressing here his contentions that the district court should have granted either his posttrial motion for judgment on his Carmack claim against Rock Island, or alternatively, the motion for a new trial on his complaint, Fulton asserts, respectively, that the verdict entitles him to judgment and that the trial court erred repeatedly in its instructions and in excluding certain evidence. We shall review these contentions seriatim.
52
A. Judgment n. o. v.
53
To comprehend Fulton's assertion that the verdict entitles him to judgment, one must first understand the respective elements of the negligence and Carmack claims submitted to the jury. Liability in common law negligence, of course, requires the plaintiff (Fulton) to show the defendant's conduct failed to conform to the standard of due care society expects a reasonable man to follow to avoid injury to others in the circumstances, and even if he fulfills this burden of proof his own contributory negligence will defeat the claim. Under the Carmack Amendment, the burden of proof is drastically altered.
54
"[T]he shipper establishes his prima facie case when he shows delivery [to the carrier] in good condition, arrival in damaged condition, and the amount of the damages. Thereupon, the burden of proof is upon the carrier to show both that it was free from negligence and that the damage to the cargo was due to one of the excepted causes relieving the carrier of liability . . . (a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods." Missouri Pac. R.R. Co. v. Elmore & Stahl, supra, 377 U.S. at 138, 137, 84 S. Ct. at 1144.
55
Here the only exception claimed was the act of the shipper in omitting the safety bolt.
56
Fulton's argument is that the jury's verdict for him on Rock Island's counterclaim constitutes a verdict either finding Fulton free of negligence or finding Rock Island guilty of contributory negligence and that either finding constitutes a jury conclusion that Rock Island failed its burden of proof on the Carmack claim. Accordingly, Fulton contends he is entitled to a judgment "upon the verdict." However, what Fulton actually seeks is judgment "notwithstanding" the jury's verdict against him on the Carmack claim, but he has not preserved his standing to make that motion because he failed to move for a directed verdict as Rule 51 requires. Nor is it helpful to Fulton that the verdicts appear to be fatally inconsistent, because Fulton twice had an opportunity to object to the form allowing those verdicts and failed to do so. Indeed, we were informed at argument by counsel for Fulton that such an objection was consciously withheld. Accordingly, we hold that Fulton is not entitled to judgment n. o. v. on the Carmack claim and turn to his contentions for a new trial as to Rock Island, which are premised upon several assignments of error in the instructions and rulings on evidence.
B. Instructions
57
Fulton first faults the instructions by assigning as error the court's charge "that there are but two . . . factual questions in this case with respect to what caused this derailment . . . whether . . . this counterweight rack extended out, or whether the load shifted." App. 1880. Fulton contends this statement is inaccurate, but we disagree. The statement was not part of the court's instructions on liability; it was merely part of the court's preambular comments delineating the issues. The court merely stated, quite accurately, that the evidence showed only two possible causes for the derailment, and proceeded also to state that there was no evidence the width of the load per se caused the accident. Thus, viewed in context, this portion of the instruction was not in error.
58
Fulton next assigns as error the two statements quoted in the margin.6 He contends the effect of these instructions was to tell the jury (1) that a rollby inspection satisfies the carrier's duty of due care whereas Fulton contends that is a fact question for the jury, and (2) that the duty to inspect extends only to a load shift whereas Fulton contends it extends also to the counterweight drift. However, when the relevant portion of the instruction is read in its entirety, App. 1889-92, it is clear the portions assigned as error are merely excerpts taken out of context of an instruction which, viewed as a whole, accurately states the law.
59
Finally, Fulton asserts it was error to fail to itemize in the instructions a dozen or so specific acts of negligence by Rock Island which Fulton had tried to prove. We note first that the thrust of this contention is that this was a failure to instruct properly on his common law negligence claim. To that extent it is moot by our holding above that recovery in negligence is preempted by the Carmack Amendment. Second, we note that these alleged items of specific negligence contributing to the derailment would also be relevant to the Carmack claim because the carrier must prove its freedom from all contributing negligence. However, the plaintiff was allowed to offer evidence of these allegedly negligent acts and argue them to the jury as contributing causes, and the court did instruct the jury that "the burden is upon the company [Rock Island] to show that it is free of any negligence or that it has caused or contributed to cause the damages complained of by the shipper." Accordingly, we do not think it was prejudicial to the plaintiff that the court declined to lengthen the instructions by itemizing each act of negligence Fulton argued to the jury.
60
In sum, we find Fulton's contentions faulting the instructions as to Rock Island to have insufficient merit to warrant reversal. We therefore turn to his contentions that certain evidence was erroneously excluded.
C. Evidence
61
The first item of evidence Fulton contends was erroneously excluded is the deposition testimony of three railroad executives concerning the multiplicity of precautions their lines take when transporting wide loads. Fulton's theory was that had Rock Island taken similar precautions because this was a wide load, it would have discovered the drifted counterweight or shifted load, that Rock Island's failure to take these precautions therefore constituted contributing negligence; hence this evidence was relevant to show the standard of care to which Rock Island should have adhered.
62
While custom is not conclusive of the standard of care, "[w]hat usually is done may be evidence of what ought to be done. . . ." Texas & P. Ry. Co. v. Behymer, 189 U.S. 468, 470, 23 S. Ct. 622, 623, 47 L. Ed. 905 (1903). Thus, this evidence was relevant, and could have been admitted at the discretion of the court. Colorado Milling & Elevator Co. v. Terminal R.R. Assoc., 350 F.2d 273, 277-278 (8th Cir. 1965), cert. denied, 382 U.S. 989, 86 S. Ct. 563, 15 L. Ed. 2d 476 (1966); Weinberg v. Northern P. Ry. Co., 150 F.2d 645, 653 (8th Cir. 1945); Midland Valley R.R. Co. v. Bell, 242 F. 803, 807-808 (8th Cir.), cert. denied, 245 U.S. 653, 38 S. Ct. 12, 62 L. Ed. 532 (1917); Chicago G. W. Ry. Co. v. McDonough, 161 F. 657, 663-666 (8th Cir. 1908). Accord, Norton v. Railway Express Agency, 412 F.2d 112, 114 (3rd Cir. 1969); Wigmore, Evidence Sec. 461 (3rd ed. 1940).
63
"[B]ut evidence of that character is not indispensable, for the ultimate and controlling test always is, not what has been the practice of others in like situations, but did the defendant in this case exercise reasonable or ordinary care. . . ." Midland Valley R.R. Co. v. Bell, supra, 242 F. at 808.
64
Accordingly, where, as here, similar evidence was admitted and the comparison of defendant's precautions with the custom of his competitors was argued to the jury, the exclusion of the evidence was not so prejudicially erroneous as to necessitate a new trial. Lowe v. Taylor Steel Products Co., 373 F.2d 65, 69 (8th Cir.), cert. denied, 389 U.S. 858, 88 S. Ct. 85, 19 L. Ed. 2d 122 (1967).
65
The second item of evidence Fulton contends was erroneously excluded is his offer of the expert testimony of Paul Lilly that if cable clamps are placed on the short end of the cable rather than the long end they will slip. This evidence was excluded because there was no evidence the cables on the derailed cars were clamped on the wrong end. To rebut that ruling Fulton points to the testimony of John T. Bauer, at App. 1050-51, but he said only that the clamps were not spaced far enough apart. Fulton, also argues the destructive nature of the accident prevented determination of how the clamps were affixed, but that hardly justifies the admission of speculation. The evidence was without proper foundation and thus was properly excluded.
66
The third item of evidence Fulton contends was erroneously excluded is his offer of testimony by Paul Lilly that Lilly obtained two pieces of cable, one from a derailed traincar and one from a derailed machine, and upon microscopic examination of those cables it was Lilly's expert opinion the cables broke not from the sudden force of the accident, but from being weakened by fraying action resulting from being too loose. This testimony was excluded because the cable was first seen by Lilly three years subsequent to the derailment and after the car and machine had been moved from Trenton to a railroad yard in Kansas City. Since no showing was made that these cables were used to secure Fulton's machinery on the ill-fated cars or, if so, that the cables were in the same condition when Lilly examined them as when the accident occurred, the testimony was properly excluded as immaterial. Sears, Roebuck & Co. v. Daniels, 299 F.2d 154, 160 (8th Cir. 1962).
67
Additionally, both excluded portions of Lilly's testimony were intended to show the cables were loose allowing the load to shift and this caused the accident; and Lilly was allowed to give his expert opinion that that was precisely what occurred. Accordingly, the excluded testimony was merely a subpart of an ultimate conclusion that was admitted, and its exclusion was, therefore, not reversibly prejudicial in any event.
68
The final items of evidence Fulton contends were erroneously excluded were photographs of the two railcars Soo's inspector Knutson, deleted from the shipment as improperly loaded, and the testimony of Clarence Tyree relating to Rock Island's actions in correcting the cabling on those cars. While the pictures might show the two deleted cars were faultily cabled, Soo recognized the improper loading at the same time it approved the other cars ultimately derailed. Accordingly, the inadequacy of these two cars does not infer the other eight were similarly inadequate. The evidence was therefore immaterial and properly excluded.
III. ROCK ISLAND'S CLAIM OF ERROR
69
The sole contention pressed by Rock Island on its protective appeal from the adverse judgment on its counterclaim is that the court in its instructions erred in placing upon Rock Island the burden of proving its freedom from contributory negligence and should have given Rock Island's requested instruction placing upon Fulton the burden of proving Rock Island contributorily negligent. However, regardless of the substantive merits of this contention, Rock Island failed to object after the charge was delivered to this particular instruction and it is therefore precluded from raising this issue on appeal. Rule 51, Fed.R.Civ.P.
70
It is not enough that Rock Island had earlier filed a requested instruction placing the burden of proof on Fulton. The purpose of Rule 51 is to compel litigants to afford the trial court an opportunity to cure a defective instruction and to prevent litigants from insuring a new trial in the event of an adverse verdict by covertly relying on the error. Meitz v. Garrison, 413 F.2d 895, 899 (8th Cir. 1969); Chicago G. W. Ry. Co. v. Casura, 234 F.2d 441, 445 (8th Cir. 1956). Furthermore, a trial court need not give a requested instruction verbatim but may rephrase the rule of law it embodies so long as he adequately and accurately states the applicable law. Partlow v. Goldstein, 263 F.2d 169, 171 (8th Cir. 1959). It would therefore undermine the purpose of the Rule to allow a previous request for an instruction to obviate the need for a specific statement of the alleged error. Indeed, that would be contrary to the express command of Rule 51 that"No party may assign as error the giving or the failure to give an instruction unless he objects thereto . . . stating distinctly the matter to which he objects and the grounds [for] his objection." (emphasis supplied).
71
Accordingly, we hold that compliance with Rule 51 is not afforded merely by filing before the charge an accurate requested instruction, but requires that there appear somewhere in the record an objection specifically delineating the objection and the grounds therefor. See Cone v. Beneficial Standard Life Ins. Co., 388 F.2d 456, 460-464 (8th Cir. 1968); Capital Transp. Co. v. Compton, 187 F.2d 844 (8th Cir. 1951).
CONCLUSION
72
The judgment for Rock Island on Fulton's claim against Rock Island, and for Fulton on Rock Island's counterclaim is affirmed. The judgment in favor of Soo is vacated and the cause is remanded for another trial on Fulton's claim against Soo, in accordance with the views expressed in this opinion. The remand of the cause against Soo is, of course, without prejudice to Soo's right to file again a motion pursuant to 28 U. S.C. Sec. 1404 to transfer the cause to the District of Minnesota.
73
Costs shall be taxed as follows: one-third each against Fulton, Rock Island and Soo.
ON PETITION FOR REHEARING
74
PER CURIAM.
75
Appellant Fulton has petitioned the Court for a rehearing, urging the Court's opinion is in error in three respects. Two of these assertions warrant no discussion.
76
The third contention is that this Court erred in pretermitting discussion of Fulton's assignment of error to the trial court's instruction relating to the respective responsibilities of the parties for the loading of the machinery onto the railcars. Fulton contends that, while the remand for a new trial as to Soo would allow the Court to pretermit that question were Soo the lone defendant, if the instruction is erroneous to the degree asserted by Fulton it also affected the cause as to Rock Island by making less difficult Rock Island's burden under the Carmack Amendment of proving that Fulton's negligence was the sole cause of the derailment.
77
Upon examination of this instruction in its entirety and in context with the other instructions, we are persuaded that, while perhaps susceptible to improvement, it is a substantially correct statement of the applicable law. See Atchison, T. & S. F. Ry. v. United States, 232 U.S. 199, 216-217, 34 S. Ct. 291, 58 L. Ed. 568 (1913); United States v. Savage Truck Lines, Inc., 209 F.2d 442, 444 (4th Cir. 1953); 13 Am.Jur.2d Carriers Sec. 319 (1964); 14 Am.Jur.2d Carriers Secs. 528-32 (1964). We therefore decline to reverse the judgment as to Rock Island. However, this conclusion in no way precludes Fulton from urging at the new trial against Soo such modifications as he may deem appropriate and as are consistent with the authorities cited above.
78
The petition for rehearing is denied.
1
The suit was filed at Fulton's place of residence, the Lubbock Division of the Northern District of Texas, but, upon Rock Island's motion, the cause was transferred pursuant to 28 U.S.C. Sec. 1404 to the court closest to the scene of the accident, the St. Joseph Division of the Western District of Missouri. After Soo was named as a defendant, it sought to transfer the cause to the District of Minnesota, but that motion was denied
2
The complaint by Fulton also named Southern Pacific as a defendant, but Southern was subsequently dismissed from the case
3
Soo raised the question of in personam jurisdiction by two motions to quash service and its answers to the second and third amended complaints. It also filed one set of Suggestions in Support of the Motion to Quash. None of these five filings distinguished between the Carmack count and the negligence count. As noted above, the district court denied the motion to quash, but nevertheless declined to submit the Carmack claim to the jury
4
The Carmack Amendment, 49 U.S.C. Sec. 20(11), when stripped of redundance, provides in pertinent part:
"Any common carrier . . . subject to the provisions of this chapter receiving property for transportation from . . . one State . . . to . . . another . . . shall issue a receipt or bill of lading therefor, and shall be liable to the lawful holder thereof for any loss, damage, or injury to such property caused by it or by any common carrier . . . to which such property may be delivered or over whose line . . . such property may pass . . . and no . . . limtation of any character whatsoever shall exempt such common carrier . . . from the liability imposed; and any such common carrier . . . shall be liable . . . for the full actual loss, damage or injury to such property caused by it or by any such common carrier . . . to which such property may be delivered . . . notwithstanding any limitation of liability or limitation of the amount of recovery or representation or agreement as to value in any such receipt or bill of lading, or in any contract, rule, regulation, or . . . tariff . . ., and any such limitation . . . is declared to be unlawful and void: Provided however, . . . that nothing in this section shall deprive any holder of such receipt or bill of lading of any remedy or right of action which he has under the existing law. . . ."
5
A third independent ground for finding the long-arm statute applicable here could be the view taken by the Sixth and Seventh Circuits of similar statutes. See Fisons Ltd. v. United States, 458 F.2d 1241 (7th Cir.), cert. denied, 405 U.S. 1041, 92 S. Ct. 1312, 31 L. Ed. 2d 581 (1972); Southern Machine Co. v. Mohasco Industries, Inc., 401 F.2d 374 (6th Cir. 1968). In those cases, the courts dealt with the long-arm statutes of Illinois and Tennessee, respectively, which are markedly similar to the Missouri statute sub judice. The courts of both those states had construed their statutes "to assert jurisdiction over nonresident defendants to the extent permitted by the" Constitution. 458 F.2d at 1250. Consequently, the federal courts held they should not view the statutes as merely erecting a few enumerated, inflexible circumstances in which service could be effected, but as establishing one broad flexible test, to wit: if the service satisfies the Constitution, it satisfies the statute. Since Missouri has likewise construed Sec. 506.500 as intended to reach the constitutional limits, Missouri ex rel. Deere & Co. v. Pinnell, supra, we could also adopt this test and avoid "a pedantic quibbling with the wording of the statute," 401 F.2d at 378, making it unnecessary to ask whether only Sec. 506.500 (1)(3) applies, whether it applies only to tort actions, whether a Carmack claim sounds in tort, etc. However, considering the answers to those questions given above, we find it unnecessary to take this expansive view of a state statute
6
"[T]he carrier is only responsible for ordinary care in what they call a rollby inspection. . . ."
"If, of course, the load did not shift, then any question of inspection in that regard is out of this case." | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/2721259/ | IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
Assigned on Briefs June 30, 2014
IN RE ANYA G.
Appeal from the Juvenile Court for Hamilton County
No. 253263 Robert D. Philyaw, Judge
No. E2013-02595-COA-R3-PT-FILED-AUGUST 27, 2014
This is a termination of parental rights case, focusing on Anya G. (“the Child”), the minor
child of Melisa G. (“Mother”). In October 2011, temporary custody of the Child was granted
to the Tennessee Department of Children’s Services (“DCS”), and the Child was placed in
foster care. DCS subsequently filed a petition to terminate the parental rights of Mother and
the Child’s father, Michael G., on December 27, 2012.1 The petition alleged as statutory
grounds for termination abandonment by failure to visit, abandonment by an incarcerated
parent who exhibited wanton disregard for the welfare of the child prior to incarceration, and
substantial noncompliance with the permanency plans. Following a bench trial, the trial
court granted the petition as to Mother upon finding that DCS had proven by clear and
convincing evidence the grounds of (1) abandonment by engaging in conduct prior to her
incarceration that exhibited a wanton disregard for the welfare of the child and (2) substantial
noncompliance with the permanency plans. The court also found clear and convincing
evidence that termination of Mother’s parental rights was in the Child’s best interest. Mother
has appealed. Discerning no error, we affirm.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Juvenile Court
Affirmed; Case Remanded
T HOMAS R. F RIERSON, II, J., delivered the opinion of the Court, in which C HARLES D.
S USANO, J R., C.J., and D. M ICHAEL S WINEY, J., joined.
Berry Foster, Chattanooga, Tennessee, for the appellant, Melisa G.
Robert E. Cooper, Jr., Attorney General and Reporter, and Alexander S. Rieger, Assistant
Attorney General, Nashville, Tennessee, for the appellee, Tennessee Department of
1
Michael G. is not a party to this appeal.
Children’s Services.
Galen Pickard, Chattanooga, Tennessee, Guardian Ad Litem.
OPINION
I. Factual and Procedural Background
Mother is a parent of two minor children: Samantha M., now age sixteen, and Anya
G., now age four.2 On August 18, 2011, Mother and Samantha were involved in an argument
regarding Mother’s boyfriend. Mother took the Child, who was two years old at the time,
and placed the Child in Mother’s vehicle without a car seat. Mother indicated that she was
upset and was leaving to “cool off.” Fearing for her sister’s safety, Samantha tried to stop
Mother from departing. During the incident, Mother drove over Samantha’s legs with her
vehicle. Consequently, Mother was arrested and charged with reckless endangerment.
Mother was placed on probation, and DCS began working with Mother regarding both
children. Subsequently, a referral was made with regard to Samantha’s cutting herself. Upon
the DCS workers’ interview of Samantha, the daughter allegedly disclosed that Mother was
using drugs such as crack cocaine in the home and prostituting herself. Samantha informed
DCS that she was the primary caretaker for the Child. Samantha also disclosed that Mother’s
boyfriend, T.B., was selling illegal drugs from Mother’s home.
DCS visited Mother’s home on October 3, 2011, finding it to be dirty and unsuitable.
Mother failed a drug screen administered by DCS that day, testing positive for both crack
cocaine and marijuana. Upon the filing of a petition, temporary custody of the children was
awarded to DCS on October 6, 2011. The children were subsequently adjudicated dependent
and neglected on December 29, 2011. Mother was arrested on December 7, 2011, and again
on April 22, 2012; June 16, 2012; and July 12, 2012. She was incarcerated at the time the
petition to terminate parental rights was filed on December 27, 2012.
DCS alleged in its petition, inter alia, that Mother had engaged in mere token
visitation with the Child prior to her incarceration, thereby abandoning the Child pursuant
to Tennessee Code Annotated § 36-1-102(1)(A)(iv) (2014). The petition further alleged that
Mother had abandoned the Child by engaging in conduct prior to her incarceration that
exhibited a wanton disregard for the welfare of the child, also pursuant to Tennessee Code
Annotated § 36-1-102(1)(A)(iv). As an additional ground for termination, the petition
alleged that Mother had failed to substantially comply with the terms of her permanency
2
Mother’s parental rights regarding Samantha are not at issue in this proceeding.
-2-
plans, pursuant to Tennessee Code Annotated § 36-1-113(g)(2). Finally, the petition alleged
that termination of Mother’s parental rights was in the Child’s best interest.
The trial court terminated Michael G.’s parental rights on June 4, 2013. The trial
regarding Mother’s parental rights was conducted over three non-consecutive days in August,
September, and October 2013. Although Mother testified on the first day of trial, she failed
to appear for the subsequent dates. Mother’s attorney informed the court at the beginning
of the second day of trial that he had received a message from Mother stating that she was
unable to appear due to a medical emergency with a family member. The DCS worker
subsequently stated that she had become aware that warrants were recently filed against
Mother. The hearing proceeded in Mother’s absence.
Following the trial, the court entered an order, finding that Mother’s demeanor in
court was “that everything was someone else’s fault and she smiled and smirked in a way not
appropriate for someone in her position as a parent facing the loss of her children.” The
court’s order, inter alia, states:
Karen Tittsworth, DCS worker, testified of the mother’s hostile attitude,
profanity, and the great lengths to which she would go to be deceptive while
this case was pending. Anya came into foster care in October 2011 and Ms.
Tittsworth has had the case continually since that time. Mother’s goals were
to address her addiction, particularly to cocaine, and achieve stable housing
and employment. Although she participated in the Transformation Project,
testimony showed she was dishonest and deceptive regarding her drug screens
and continued to test positive during the pendency of this case.
Partnership worker Yashica Baker likewise testified of the mother’s
hostility and refusal to submit to drug screens. [Mother] continued to live with
her mother even though she and her mother have a volatile relationship.
Mother was diagnosed with bi-polar disorder but did not comply with efforts
to arrange a mental health assessment.
Mother has never shown proof of employment or any signs of forward
progress on the goals on her plan of care. The DCS worker stated they were
no closer to returning Anya at this or any other point than when she first came
into care. Any meaningful or consistent parenting time was hindered by
Mother’s frequent periods of incarceration and it is believed she currently has
two (2) outstanding warrants. [Mother] continued to maintain a relationship
with a man who has a lengthy criminal record and who was, in some part,
-3-
involved in the incident which led to the removal of the children from the
mother’s care.
From all of which the Court found the State carried the burden of proof
by presenting clear and convincing proof that the mother abandoned Anya [G.]
by incarceration, was in substantial non-compliance with the goals of the
permanency plan, and that it was in the best interest of the child for the
parental rights of the mother to be terminated.
The foster mother, [P.G.], testified of Anya’s progress since coming
into custody from the constant screaming, lack of communication skills, and
inappropriate self-touching. Anya is now in a pre-kindergarten program doing
well. She has some aggressive behaviors and suffers from speech problems
but does not exhibit the former behaviors since she has not seen her mother for
an extended period of time. [P.G.] and her husband are planning to proceed
with adoption as soon as that becomes an option.
Following this initial order, the trial court entered a Termination of Parental Rights
and Final Decree of Complete Guardianship, terminating Mother’s parental rights to the
Child. This decree erroneously lists the ground of persistent conditions, pursuant to
Tennessee Code Annotated § 36-1-113(g)(3), as an additional basis for termination. Mother
timely appealed. While the appeal was pending, DCS filed a motion seeking leave of court
to have a corrected order entered. Mother’s counsel consented to this action. This Court
then remanded the matter to the trial court for entry of a corrected order.
The trial court thereafter entered an Amended Termination of Parental Rights and
Final Decree of Complete Guardianship, which decree states in pertinent part:
3. Grounds for the termination of the parental rights of Melisa [G.] to the
child, Anya [G.] exist, in that:
(A) Respondent Melisa [G.] abandoned the subject child in that she was
incarcerated part of the four (4) months prior to the filing of this
Petition which exhibits a wanton disregard for the welfare of the child.
Specifically, the mother was arrested on December 7, 2011, April 22,
2012, June 16, 2012, and July 2, 2012, and has just recently been
released. The child came into custody on October 5, 2011. The mother
is repeatedly incarcerated and continues to test positive for drugs for
which she has no prescription. Respondent continued to incur criminal
charges and violate her probation by testing positive for cocaine.
-4-
(B) Respondent, Melisa [G.], has failed to comply in a substantial manner
with the statement of responsibilities set out in periodic foster care
plans prepared for and signed by said Respondent, following the subject
child being found to be dependent and neglected by the Juvenile Court
of Hamilton County. [DCS] has explained to Respondent those
reasonable responsibilities, which are directly related and aimed at
remedying the conditions, which necessitate foster care placement.
Specifically, Respondent failed to: obtain stable housing, refused to
complete a mental health assessment which was to be paid for by the
Department, did not follow through with drug treatment as
recommended by her alcohol and drug assessment, has continued to
incur criminal charges and violate her probation, has tested positive for
cocaine, has not addressed domestic violence issues, and has not
participated in individual or family counseling. The mother later
violated her probation in April 2012 because she was arrested again for
vandalism and malicious mischief. The mother tested positive for
cocaine on May 8, 2012 in her initial testing to restart probation and her
levels were extraordinarily high.
4. Pursuant to T.C.A. § 36-1-113(i), it is for the best interest of the subject
child and the public that all of the parental rights of the Respondent,
Melisa [G.], to the child, Anya [G.] be forever terminated and that the
custody, control and complete guardianship of said child should now be
awarded to the State of Tennessee, Department of Children’s Services
with the right to place said child for adoption and to consent to any
adoption in loco parentis, in that
(a) Respondent, Melisa [G.], has not maintained regular
visitation or other contact with the child.
(b) There is no meaningful relationship between the
Respondent and child.
(c) A change of caretakers and home is likely to have a
highly negative effect on the child. The child is in an
adoptive home and thriving in that placement.
(d) Respondent, Melisa [G.], has shown brutality, abuse or
neglect toward the child or another child in the family or
household. When the children were removed on August
-5-
18, 2011, the mother tried to run over Samantha with a
car and Anya witnessed this and remembers it to this day.
The mother was allegedly high on crack cocaine at the time.
The amended decree therefore terminated Mother’s parental rights to the Child based on the
statutory grounds of (1) abandonment by engaging in conduct prior to incarceration that
exhibits a wanton disregard for the welfare of the child and (2) substantial noncompliance
with the permanency plans.
II. Issues Presented
Mother presents the following issues for our review, which we have restated slightly:
1. Whether the trial court violated Mother’s due process rights under the
Fourteenth Amendment of the U.S. Constitution because the order
terminating Mother’s parental rights included the statutory ground of
persistent conditions, although this ground was not alleged in the
petition to terminate parental rights.
2. Whether DCS’s lack of reasonable efforts prevented reunification of
Mother and the Child.
3. Whether the trial court erred by finding clear and convincing evidence
to support termination of Mother’s parental rights on the statutory
ground of substantial noncompliance with the permanency plans.
4. Whether the trial court erred by finding clear and convincing evidence
to establish that the termination of Mother’s parental rights was in the
best interest of the Child.
III. Standard of Review
In a termination of parental rights case, this Court has a duty to determine “whether
the trial court’s findings, made under a clear and convincing standard, are supported by a
preponderance of the evidence.” In re F.R.R., III, 193 S.W.3d 528, 530 (Tenn. 2006). The
trial court’s findings of fact are reviewed de novo upon the record, accompanied by a
presumption of correctness unless the evidence preponderates against those findings. Id.;
Tenn. R. App. P. 13(d). Questions of law, however, are reviewed de novo with no
presumption of correctness. In re Bernard T., 319 S.W.3d 586, 597 (Tenn. 2010). The trial
court’s determinations regarding witness credibility are entitled to great weight on appeal and
-6-
shall not be disturbed absent clear and convincing evidence to the contrary. See Jones v.
Garrett, 92 S.W.3d 835, 838 (Tenn. 2002).
“Parents have a fundamental constitutional interest in the care and custody of their
children under both the United States and Tennessee constitutions.” Keisling v. Keisling, 92
S.W.3d 374, 378 (Tenn. 2002). It is well established, however, that “this right is not absolute
and parental rights may be terminated if there is clear and convincing evidence justifying
such termination under the applicable statute.” In re Drinnon, 776 S.W.2d 96, 97 (Tenn. Ct.
App. 1988) (citing Santosky v. Kramer, 455 U.S. 745, 102 S. Ct. 1388, 71 L. Ed. 2d 599
(1982)). As our Supreme Court has instructed:
In light of the constitutional dimension of the rights at stake in a termination
proceeding under Tenn. Code Ann. § 36-1-113, the persons seeking to
terminate these rights must prove all the elements of their case by clear and
convincing evidence. Tenn. Code Ann. § 36-1-113(c); In re Adoption of
A.M.H., 215 S.W.3d at 808-09; In re Valentine, 79 S.W.3d 539, 546 (Tenn.
2002). The purpose of this heightened burden of proof is to minimize the
possibility of erroneous decisions that result in an unwarranted termination of
or interference with these rights. In re Tiffany B., 228 S.W.3d 148, 155 (Tenn.
Ct. App. 2007); In re M.A.R., 183 S.W.3d 652, 660 (Tenn. Ct. App. 2005).
Clear and convincing evidence enables the fact-finder to form a firm belief or
conviction regarding the truth of the facts, In re Audrey S., 182 S.W.3d 838,
861 (Tenn. Ct. App. 2005), and eliminates any serious or substantial doubt
about the correctness of these factual findings. In re Valentine, 79 S.W.3d at
546; State Dep’t of Children’s Servs. v. Mims (In re N.B.), 285 S.W.3d 435,
447 (Tenn. Ct. App. 2008).
In re Bernard T., 319 S.W.3d at 596.
IV. Amended Order
Mother’s brief, which was filed prior to the trial court’s entry of an amended final
decree, raises the issue of whether Mother’s due process rights under the Fourteenth
Amendment of the U.S. Constitution were violated when the order terminating Mother’s
parental rights included the ground of persistent conditions, inasmuch as this ground was not
alleged in the petition to terminate parental rights. As explained above, an amended final
decree was later entered by the trial court, which properly listed as the only grounds for
termination (1) abandonment by engaging in conduct prior to incarceration that exhibits a
wanton disregard for the welfare of the child and (2) substantial noncompliance with the
permanency plans. Therefore, Mother’s first issue on appeal is now moot.
-7-
V. Reasonable Efforts by DCS
Mother contends that DCS did not provide her with reasonable assistance in obtaining
the goal of reunification with the Child. As this Court has previously elucidated:
[I]n the absence of aggravating circumstances, [DCS] is statutorily required to
make reasonable efforts to reunite a family after removing children from their
parents’ custody. Tenn. Code Ann. § 37-1-166(a)(2), (g)(2) (2005); In re
M.E., No. M2003-00859-COA-R3-PT, 2004 WL 1838179, at *9 (Tenn. Ct.
App. Aug.16, 2004), perm. app. denied (Tenn. Nov. 8, 2004); In re C.M.M.,
2004 WL 438326, at * 7. Because of this obligation, the Department must not
only establish each of the elements in Tenn. Code Ann. § 36-1-113(g)(3)(A),
it must also establish by clear and convincing evidence that it made reasonable
efforts to reunite the family and that these efforts were to no avail. In re
C.M.M., 2004 WL 438326, at *7 n. 27, *8.
While the Department’s reunification efforts need not be “herculean,” the
Department must do more than simply provide the parents with a list of
services and send them on their way. In re C.M.M., 2004 WL 438326, at *7.
The Department’s employees must use their superior insight and training to
assist the parents in addressing and completing the tasks identified in the
permanency plan.
For the purpose of proceedings such as this one, the Department’s
reunification efforts are “reasonable” if the Department has exercised
“reasonable care and diligence . . . to provide services related to meeting the
needs of the child and the family.” Tenn. Code Ann. § 37-1-166(g)(1) (2005).
The reasonableness of the Department’s efforts depends upon the
circumstances of the particular case. The factors that courts use to determine
the reasonableness of the Department’s efforts include: (1) the reasons for
separating the parent from his or her children, (2) the parent’s physical and
mental abilities, (3) the resources available to the parent, (4) the parent’s
efforts to remedy the conditions that required the removal of the children, (5)
the resources available to the Department, (6) the duration and extent of the
parent’s remedial efforts, and (7) the closeness of the fit between the
conditions that led to the initial removal of the children, the requirements of
the permanency plan, and the Department’s efforts.
The Department does not have the sole obligation to remedy the conditions
that required the removal of children from their parents’ custody. When
-8-
reunification of the family is a goal, the parents share responsibility for
addressing these conditions as well. Thus, parents desiring the return of their
children must also make reasonable and appropriate efforts to rehabilitate
themselves and to remedy the conditions that required the Department to
remove their children from their custody.
In re Giorgianna H., 205 S.W.3d 508, 518-19 (Tenn. Ct. App. 2006) (other internal citations
omitted).
In this case, the evidence demonstrated that Mother failed to take any individual
responsibility for addressing the conditions leading to removal of the Child from her custody.
As Ms. Tittsworth testified, the primary problem that Mother needed to address in order to
regain custody was her drug addiction. DCS provided Mother with a referral to Bradford
Health Services (“Bradford”) for an alcohol and drug assessment. Bradford recommended
that Mother attend intensive outpatient treatment, but Mother did not follow through with
that treatment, blaming transportation difficulties. Mother made no progress regarding
treatment for her drug addiction for several months. Ms. Tittsworth testified that Mother was
uncooperative with any and all efforts to provide assistance. According to Ms. Tittsworth
and Ms. Baker, Mother was openly hostile and abusive toward them, often resorting to
cursing, yelling, and name-calling. Despite Mother’s uncongenial behavior, Ms. Tittsworth
made two referrals for Mother regarding employment, provided Mother with at least three
bus passes, arranged for Mother to have visitation with the Child when she was not
incarcerated, provided Mother with housing referrals, and arranged for Mother to undergo
a psychological evaluation. Mother, however, made no progress whatsoever toward these
goals on her permanency plans, refusing or ignoring all offers of assistance. As Ms.
Tittsworth related, Mother instead placed blame onto others for her problems and refused to
accept responsibility for her own behavior.
As this Court has previously stated:
Reunification is a “two-way street,” and the law does not require DCS to
carry the entire burden of this goal. DCS cannot reasonably be expected to
do everything for a parent.
In re A.R., No. W2008-00558-COA-R3-PT, 2008 WL 4613576 at *16 (Tenn. Ct. App. Oct.
13, 2008). We conclude that the efforts toward reunification expended by DCS in this case
were clearly reasonable, despite Mother’s hostile attitude toward DCS’s efforts to provide
assistance. This issue is without merit.
-9-
VI. Substantial Noncompliance with Permanency Plans
The trial court terminated Mother’s parental rights, inter alia, on the statutory ground
that she failed to substantially comply with the reasonable responsibilities set out in her
permanency plans. Tennessee Code Annotated § 36-1-113(g)(2) provides, as relevant to this
action:
(g) Initiation of termination of parental or guardianship rights may be based
upon any of the grounds listed in this subsection (g). The following grounds
are cumulative and non-exclusive, so that listing conditions, acts or omissions
in one ground does not prevent them from coming within another ground:
...
(2) There has been substantial noncompliance by the parent or
guardian with the statement of responsibilities in a permanency
plan pursuant to the provisions of title 37, chapter 2, part 4.
The initial permanency plan in this case required Mother, inter alia, to complete an
alcohol and drug assessment and follow all recommendations, including submitting to
random drug screens. Mother was also required to have a psychological assessment to
address anger management issues, parenting skills, domestic violence issues, and any other
mental health issues. In addition, Mother was required to obtain and maintain suitable
housing, visit the Child regularly, pay child support, and maintain regular contact with DCS
representatives. Subsequent permanency plans incorporated the same requirements listed
above, as well as required Mother to (1) resolve her legal issues and not incur new criminal
charges, (2) cease associating with persons with a violent or criminal history, (3) achieve and
maintain sobriety, and (4) demonstrate appropriate parenting skills.
As previously noted, the trial court found that Mother had failed to substantially
comply with her responsibilities set out in the permanency plans. The court explained, in
relevant part:
Specifically, [Mother] failed to: obtain stable housing, refused to complete a
mental health assessment which was to be paid for by the Department, did not
follow through with drug treatment as recommended by her alcohol and drug
assessment, has continued to incur criminal charges and violate her probation,
-10-
has tested positive for cocaine, has not addressed domestic violence issues, and
has not participated in individual or family counseling.
Having carefully reviewed the record, we conclude that the preponderance of the evidence
supports these findings. Mother had continued to reside with the maternal grandmother, with
whom Ms. Tittsworth testified Mother had a volatile and abusive relationship. Mother had
never completed the DCS-provided mental health assessment, despite the scheduling and
rescheduling of her appointments to do so. Mother did not follow through with drug
rehabilitation treatment at Bradford prior to the filing of the termination petition, and she
continued to fail drug tests and incur drug-related criminal charges.
Following the filing of the termination petition, Mother completed inpatient treatment
through a different facility. Mother subsequently relapsed, however, and did not complete
her aftercare program. Mother was released from that program because she stopped
attending classes and presented a forged doctor’s excuse. Mother continued her relationship
with T.B., regardless of the volatility of that relationship due to drug and domestic violence
problems. Mother experienced ongoing legal issues, with new warrants having been filed
against her during the course of the termination trial. By her testimony at trial, Mother
admitted that she needed to “get herself together” before she could effectively parent the
Child. Mother had also failed to visit the Child regularly, demonstrate appropriate parenting
skills, maintain regular contact with DCS representatives, or pay more than token child
support. We conclude that the evidence in this case preponderates in favor of the trial court’s
determination, by clear and convincing evidence, that Mother was in substantial
noncompliance with the permanency plans.
VII. Abandonment by Exhibiting Wanton Disregard Prior to Incarceration
The trial court also terminated Mother’s parental rights based on the ground of
abandonment by engaging in conduct prior to incarceration that exhibits a wanton disregard
for the welfare of the child. Although Mother did not appeal this statutory ground, our
Supreme Court has instructed us to review the trial court’s findings of fact and conclusions
of law as to each ground for termination. See In re Angela E., 303 S.W.3d 240, 251 n.14
(Tenn. 2010). Tennessee Code Annotated § 36-1-102(1)(A) defines abandonment, in
relevant part, as:
(iv) A parent or guardian is incarcerated at the time of the institution of an
action or proceeding to declare a child to be an abandoned child, or the parent
-11-
or guardian has been incarcerated during all or part of the four (4) months
immediately preceding the institution of such action or proceeding, and either
has willfully failed to visit or has willfully failed to support or has willfully
failed to make reasonable payments toward the support of the child for four (4)
consecutive months immediately preceding such parent’s or guardian’s
incarceration, or the parent or guardian has engaged in conduct prior to
incarceration that exhibits a wanton disregard for the welfare of the child;
....
(Emphasis added.) Regarding the ground of abandonment by wanton disregard, the statute
does not limit the parent’s conduct to any particular four-month period prior to incarceration.
See In re Audrey S., 182 S.W.3d 838, 865 (Tenn. Ct. App. 2005).
The trial court made the following pertinent finding in its final decree:
Specifically, the mother was arrested on December 7, 2011, April 22, 2012,
June 16, 2012, and July 2, 2012, and has just recently been released. The child
came into custody on October 5, 2011. The mother is repeatedly incarcerated
and continues to test positive for drugs for which she has no prescription.
[Mother] continued to incur criminal charges and violate her probation by
testing positive for cocaine.
The preponderance of the evidence adduced at trial supports these findings. During
the fourteen-month period that the Child had been removed from her custody prior to the
filing of the termination petition, Mother incurred multiple criminal charges, most of which
were drug-related. Mother continued to incur criminal charges through the course of the
termination trial. Mother repeatedly failed drug screens administered pursuant to her
probation and failed to present any effort toward rehabilitation until well after the termination
petition was filed.
The above-referenced statute does not define “wanton disregard.” We have
previously explained the purpose behind this statutory section, however, as follows:
Tenn. Code Ann. § 36-1-102(1)(A)(iv) also reflects the commonsense notion
that parental incarceration is a strong indicator that there may be problems in
the home that threaten the welfare of the child. Incarceration severely
-12-
compromises a parent’s ability to perform his or her parental duties. A
parent’s decision to engage in conduct that carries with it the risk of
incarceration is itself indicative that the parent may not be fit to care for the
child. However, parental incarceration is not an infallible predictor of parental
unfitness. Accordingly, Tenn. Code Ann. § 36-1-102(1)(A)(iv)’s second test
for abandonment does not make incarceration alone a ground for the
termination of parental rights. An incarcerated or recently incarcerated parent
can be found guilty of abandonment only if the court finds, by clear and
convincing evidence, that the parent’s pre-incarceration conduct displayed a
wanton disregard for the welfare of the child. Thus, the parent’s incarceration
serves only as a triggering mechanism that allows the court to take a closer
look at the child’s situation to determine whether the parental behavior that
resulted in incarceration is part of a broader pattern of conduct that renders the
parent unfit or poses a risk of substantial harm to the welfare of the child.
In re Audrey S., 182 S.W.3d at 866 (internal citations omitted). As the Court further
explained, “We have repeatedly held that probation violations, repeated incarceration,
criminal behavior, substance abuse, and the failure to provide adequate support or
supervision for a child can, alone or in combination, constitute conduct that exhibits a wanton
disregard for the welfare of a child.” Id. at 868.
Upon our review of the record in this cause, we conclude that Mother engaged in
conduct prior to her incarceration that exhibited a wanton disregard for the welfare of the
Child. Her failure to address her substance abuse issues and her continued criminal behavior,
probation violations, and incarcerations demonstrate a broad pattern of conduct that renders
her unfit to care for the Child. There is clear and convincing evidence to support the trial
court’s termination of Mother’s parental rights on this statutory ground as well.
VIII. Best Interest of Child
When a parent has been found to be unfit by establishment of a ground for
termination, as here, the interests of parent and child diverge, and the focus shifts to what is
in the child’s best interest. In re Audrey S., 182 S.W.3d at 877. Tennessee Code Annotated
§ 36-1-113(i) provides a list of factors the trial court is to consider when determining if
termination of parental rights is in the child’s best interest. This list is not exhaustive, and
the statute does not require the court to find the existence of every factor before concluding
that termination is in a child’s best interest. In re Audrey S., 182 S.W.3d at 878. Further, the
-13-
best interest of a child must be determined from the child’s perspective and not the parent’s.
White v. Moody, 171 S.W.3d 187, 194 (Tenn. Ct. App. 2004).
Tennessee Code Annotated § 36-1-113(i) lists the following factors for consideration:
(1) Whether the parent or guardian has made such an adjustment
of circumstance, conduct, or conditions as to make it safe and in
the child’s best interest to be in the home of the parent or
guardian;
(2) Whether the parent or guardian has failed to effect a lasting
adjustment after reasonable efforts by available social services
agencies for such duration of time that lasting adjustment does
not reasonably appear possible;
(3) Whether the parent or guardian has maintained regular
visitation or other contact with the child;
(4) Whether a meaningful relationship has otherwise been
established between the parent or guardian and the child;
(5) The effect a change of caretakers and physical environment
is likely to have on the child’s emotional, psychological and
medical condition;
(6) Whether the parent or guardian, or other person residing with
the parent or guardian, has shown brutality, physical, sexual,
emotional or psychological abuse, or neglect toward the child,
or another child or adult in the family or household;
(7) Whether the physical environment of the parent’s or
guardian’s home is healthy and safe, whether there is criminal
activity in the home, or whether there is such use of alcohol,
controlled substances, or controlled substance analogues as may
render the parent or guardian consistently unable to care for the
-14-
child in a safe and stable manner;
(8) Whether the parent’s or guardian’s mental and/or emotional
status would be detrimental to the child or prevent the parent or
guardian from effectively providing safe and stable care and
supervision for the child; or
(9) Whether the parent or guardian has paid child support
consistent with the child support guidelines promulgated by the
department pursuant to § 36-5-101.
The trial court found that it was in the Child’s best interest to terminate Mother’s
parental rights, as demonstrated by the court’s relevant findings as to the following factors:
(a) Respondent, Melisa [G.], has not maintained regular visitation or other
contact with the child.
(b) There is no meaningful relationship between the Respondent and child.
(c) A change of caretakers and home is likely to have a highly negative
effect on the child. The child is in an adoptive home and thriving in
that placement.
(d) Respondent, Melisa [G.], has shown brutality, abuse or neglect toward
the child or another child in the family or household. When the
children were removed on August 18, 2011, the mother tried to run
over Samantha with a car and Anya witnessed this and remembers it to
this day. The mother was allegedly high on crack cocaine at the time.
The proof preponderates in favor of these findings. In addition, when reviewing the
evidence in light of the statutory factors, it is clear that Mother did not make an adjustment
to her circumstances or conduct such that it would be safe for the Child to be in her home.
Mother had failed a drug screen as recently as March 2013. Moreover, given the time
involved and lack of effort expended by Mother in this case, an adjustment of circumstance
does not reasonably appear possible. Mother did visit with the Child but did not demonstrate
that she had a relationship with her. In fact, the foster mother testified that the Child was
afraid of Mother and experienced nightmares and behavior reflecting regression after visits.
-15-
A present change in caretakers would likely have a detrimental effect given the
Child’s needs and Mother’s inability or unwillingness to address her drug problem. Mother
displayed neglect of and abuse toward the Child because of her drug use, and her home was
not safe or appropriate as she continued in substance abuse. The Child was thriving in her
current placement and had bonded well with the foster family, who wished to adopt her once
that option was available. Mother’s mental and emotional status would prevent her from
providing a safe home or stability for the Child, as she resisted all efforts by DCS to extend
help. Mother appeared to lack an appreciation of the significance of her problem. Finally,
Mother had paid only token child support. The evidence does not preponderate against the
trial court’s determination, by clear and convincing evidence, that terminating Mother’s
parental rights was in the best interest of the Child.
IX. Conclusion
The judgment of the trial court terminating the parental rights of Mother is affirmed.
Costs on appeal are taxed to appellant, Melisa G. This case is remanded to the trial court,
pursuant to applicable law, for enforcement of the trial court’s judgment and collection of
costs assessed below.
_________________________________
THOMAS R. FRIERSON, II, JUDGE
-16- | 01-03-2023 | 08-27-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/2194517/ | 933 A.2d 725 (2007)
284 Conn. 922
STATE of Connecticut
v.
Kenneth FOWLER.
Supreme Court of Connecticut.
Decided October 10, 2007.
Carlos E. Candal, special public defender, in support of the petition.
Lisa A. Riggione, senior assistant state's attorney, in opposition.
The defendant's petition for certification for appeal from the Appellate Court, 102 Conn.App. 154, 926 A.2d 672 (2007), is denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/403606/ | 677 F.2d 522
FIRST NATIONAL MONETARY CORPORATION, Plaintiff-Appellee,v.COMMODITY FUTURES TRADING COMMISSION, Philip McB. Johnson,Chairman, James M. Stone, Susan M. Phillips, andDavid G. Gartner, Commissioners,Defendants-Appellants.MONEX INTERNATIONAL, LTD., Plaintiff-Appellee,v.COMMODITY FUTURES TRADING COMMISSION, Philip McB. Johnson,Chairman, James M. Stone, Susan M. Phillips, and David G.Gartner, Commissioners, and George H. Painter,Administrative Law Judge, Defendants-Appellants.
Nos. 81-1750, 82-1024 and 81-1803.
United States Court of Appeals,Sixth Circuit.
Argued March 23, 1982.Decided May 3, 1982.Order of Clarification June 9, 1982.
Leonard R. Gilman, U. S. Atty., Detroit, Mich., Charles R. Mills, Nancy E. Yanofsky, Glynn L. Mays, Gregory C. Glynn, Associate Gen. Counsel, Commodity Futures Trading Com'n, Washington, D. C., for defendants-appellants.
Donald F. Tucker, Southfield, Mich., Boyd Lemon, Los Angeles, Cal., Lawrence Silver, Beverly Hills, Cal., John D. Harwell, Memel, Jacobs, Pierno & Gersh, Los Angeles, Cal., for plaintiff-appellee.
Before LIVELY and MERRITT, Circuit Judges, and WEICK, Senior Circuit Judge.
MERRITT, Circuit Judge.
1
Before the administrative trial began, the District Court enjoined the defendant administrative agency from proceeding with an adjudicatory hearing to be conducted under section 5 of the Administrative Procedure Act, 5 U.S.C. § 554 (1976), against the plaintiffs, who are commodity dealers. It did so apparently on two theories: that the plaintiffs will be unable to get a fair trial before the agency and that the question of commodity law presented by the agency's administrative complaint against plaintiffs requires resolution first by rule making procedures under section 4 of the Administrative Procedure Act. We reverse. The record does not support an advance determination that the adjudicatory proceeding initiated by the administrative complaint will be unfair. Under applicable principles of administrative law the agency itself is entitled to choose in the first instance the administrative processes to be used in resolving the questions involved without prior judicial intervention or advance judicial clearance of its administrative processes. Thus the filing of a complaint initiating the adjudicatory proceeding does not constitute "final agency action" under section 10(c) of the APA, 5 U.S.C. § 704, subject to judicial review at this time. Upon completion of the administrative process, the agency's decision and its procedures will be subject to judicial review in the normal course under Chapter 7 of the Administrative Procedure Act.
2
* Plaintiff corporations are engaged in the purchase and sale of contracts for precious metals. Since 1975 Monex has sold gold and silver contracts directly to the public under a form of contract broadly labeled a "forward contract." First National Monetary Corporation has offered similar contracts, called "cash forward contracts" since 1978. Under both contracts the customer makes a down payment, and the dealer "forwards" the rest of the contract price, for which the customer is charged a fee. The contracts are usually liquidated by offsetting transactions rather than by taking delivery of the commodity under the contract. The administrative complaint alleges that the contracts are "futures" contracts and are illegal under the Commodity Exchange Act because not consummated on an exchange or regulated "contract market." Both corporations claim that these contracts are in the nature of "leverage" contracts potentially subject to regulation by the Commodity Futures Trading Commission. But they assert that the agency can only regulate the contracts through rule making procedures and not by adjudicatory administrative processes.
3
The federal administrative agency, the Commodity Futures Trading Commission, is charged with the responsibility of regulating "transactions involving contracts of sale of a commodity for future delivery...." 7 U.S.C. § 2 (1976). These "futures" contracts are subject to extensive regulation and must be executed through a commodities exchange or "contract market." 7 U.S.C. § 6h. Excluded from the term "future delivery," is "any sale of any cash commodity for deferred shipment or delivery." 7 U.S.C. § 2. A 1978 amendment to the Commodities Exchange Act gives the Commission authority to regulate "leverage" and "margin" contracts "for the delivery of silver bullion, gold bullion, or bulk silver coins or bulk gold coins," but "only after notice and opportunity for hearing." 7 U.S.C. § 23(b).
4
On September 5, 1978, the Commission Office of General Counsel submitted a memorandum to the Commission which stated that "all leverage transactions" in gold and silver are futures contracts subject to the Commission's regulatory authority. On the basis of this memorandum, the Commission solicited public comment on a proposal to regulate such leverage transactions. After analysis of public comment, which included comments by plaintiffs, the Commission announced a proposal to determine, effective January 1, 1980, that "leverage" transactions for gold and silver "of the type presently being offered to the public" are futures contracts.
5
On August 8, 1979, the Commission filed administrative complaints against plaintiffs charging that they are in violation of the Act by selling forward contracts other than through a contract market. On November 20, 1979, the Commission moved back the effective date of its decision to treat leverage contracts as futures contracts until June 30, 1980. On May 28, 1980, the postponement date was extended to October 1, 1982. The plaintiffs moved for a stay of proceedings against them until the October 1, 1982, date. An Administrative Law Judge granted the stay reasoning that because the Commission had decided to postpone the effective date of its decision to regulate leverage contracts, the same rationale should extend to adjudicatory proceedings. On interlocutory review the Commission vacated the stay, finding that the Administrative Law Judge had abused his discretion by equating "forward" contracts with "leverage" contracts. The administrative trial was set for November 23, 1981.
6
On November 18, 1981, Monex filed suit in the Central District of California, and First National filed suit in the Eastern District of Michigan. Both actions sought to enjoin the Commission from proceeding with the adjudicatory proceedings on grounds that the Commission must act by rule before it acts by adjudicatory order. The District Court in California issued a temporary restraining order and transferred the case to the Eastern District of Michigan. The District Court in Michigan also issued a temporary restraining order pending a hearing on the preliminary injunction. Following briefing and oral argument by the parties, the District Court granted a preliminary injunction in an oral opinion from the bench on December 17, 1981. The District Judge held that further exhaustion of administration remedies by plaintiffs was not required and that the Commission must act by rule making rather than adjudication in determining the question whether plaintiffs' "forward" contracts are "futures" contracts under the statute subject to execution only through commodities exchanges. It held that the filing of the administrative complaint constitutes final agency action and that it appeared that plaintiffs could not receive a fair administrative trial and disposition through adjudicatory proceedings. The District Court issued a preliminary injunction enjoining the administrative trial and restraining the conduct of further adjudicatory proceedings on the complaint issued by the Commission, finding that plaintiffs would suffer irreparable injury in the form of economic loss and injury to good will if the questions raised by the administrative complaint were decided by the agency through adjudicatory proceedings.
II
7
Section 10(c) of the APA provides for judicial review only of "agency action" (1) "made reviewable by statute" and (2) "final agency action." It provides further that "preliminary" matters "not directly reviewable" are "subject to review on the review of the final agency action." 5 U.S.C. § 704. Since the complaint here is not "made reviewable by statute," the question is whether its issuance constitutes "final agency action." The District Court held that the filing of the complaint is a "final agency action." We do not agree.
8
If "final agency action" means the same thing as "final decision" under § 1291, Title 28, it is clear that the act of filing a complaint is interlocutory and not "final." We do not need to strictly equate the two in order to recognize the obvious fact that many of the same considerations of finality apply in defining the two concepts. See Pepsico, Inc. v. Federal Trade Comm'n, 472 F.2d 179 (2nd Cir. 1972), cert. denied 414 U.S. 876, 94 S.Ct. 44, 38 L.Ed.2d 122 (1973). The Supreme Court has also suggested that similar considerations apply in its recent decision concluding that the filing of an FTC administrative complaint initiating an adjudicatory proceeding against the oil companies is not "final agency action," Federal Trade Comm'n v. Standard Oil of California, 449 U.S. 232, 101 S.Ct. 488, 66 L.Ed.2d 46 (1980). Plaintiffs argue that Socal is not in point because here plaintiffs are attacking the "authority," the "power," of the agency to proceed by filing an administrative complaint preliminary to an adjudicatory proceeding. Socal cannot be so easily distinguished. Similar arguments were made there. The claim in Socal was that the agency acted beyond its delegated authority in issuing the complaint because it had not made necessary precomplaint findings. The Supreme Court discussed the finality considerations as follows:
9
Judicial intervention into the agency process denies the agency an opportunity to correct its own mistakes and to apply its expertise.... Intervention also leads to piecemeal review which at the least is inefficient and upon completion of the agency process might prove to have been unnecessary.... Finally, every respondent to a Commission complaint could make the claim that Socal had made. Judicial review of the averments in the Commission's complaints should not be a means of turning prosecutor into defendant before adjudication concludes.
10
Socal, supra, 449 U.S. at 242-243, 101 S.Ct. at 494. Similar considerations apply here. In addition, as explained below, we disagree with the holding of District Judge Gilmore that the issuance of the complaint is so plainly beyond the jurisdiction of the Commission that the administrative proceedings must necessarily turn out to be void whatever their outcome.
11
Plaintiff makes two basic arguments, both of which the District Court apparently accepted, that the complaint initiating adjudicatory proceedings is so plainly beyond the Commission's power that a court should intervene at the outset to declare the proceedings a nullity. We disagree with both arguments.
12
First, plaintiffs ask us to assume in advance of the administrative trial and disposition that they will lose and that the administrative proceedings are "futile" (Brief of First National Monetary Corp., 45-47), that the administrative agency will act illegally, that a retroactive order will be entered punishing them unfairly and that they will be harmed irreparably before they can obtain judicial review and redress (id. at 57-70). The District Court appears to have accepted some or all of these propositions in its oral decision from the bench enjoining the agency in advance from hearing the case. We cannot accept these propositions in the absence of an administrative record which indicates that they are true. To the extent that the District Court in its oral disposition rested its decision on such predictions regarding the future course of administrative proceedings, we conclude that its findings are clearly erroneous and wholly unsupported by the present record. We do not know at this point what course the administrative proceedings will take, but we are not empowered to intrude into the administrative proceedings in advance on the basis of such assumptions. As the Supreme Court noted in Socal the plaintiffs will not be "bound by the Commission's decision until judicial review is complete," 449 U.S. at 241, 101 S.Ct. at 494, and the necessity of first litigating the issues before an administrative agency does not constitute irreparable injury, id. at 244, 101 S.Ct. at 495.
13
The plaintiffs' second argument is that the agency can do nothing in the way of adjudication respecting the plaintiffs' off-exchange "forward" or "leverage" metals contracts until the agency issues detailed regulations governing the conduct in question. To the extent that the court below accepted this argument before the administrative process was completed, it erred. Although it is true that the difference between "futures," "margin," "leverage" and "forward" contracts is unclear from both an economics and a legal point of view and although it is clear that the agency must address serious policy questions in determining under what circumstances it should permit the type of off-exchange metals contracts at issue here, we see nothing in this record to support at this time the District Court's conclusion that rule making procedures are inherently more productive of efficient policy making in this area than are adjudicatory proceedings. Where administrative officials are uncertain of the correct answer to a regulatory problem in the abstract, it is often not unreasonable for them to proceed on a case by case basis. The fact that the Commission changed its mind and decided to investigate the problem in an adjudicatory proceeding does not mean that the Commission has decided to "railroad" the plaintiffs. It may simply mean that the Commission believes that an adversary proceeding with a factual record is the best way to define and resolve the issues because the initial effort at rule making indicates that the issues are more subtle and difficult than was first believed.
14
Unless Congress has acted to make the requirements of the commodities statute inoperative until the Commission issues implementing regulations applicable to commodities contracts for precious metals, we believe we must follow the general principle laid down in Securities and Exchange Commission v. Chenery Corp., 332 U.S. 194, 67 S.Ct. 1575, 91 L.Ed. 1995 (1947). There the company attacked the agency's administrative order entered after an adjudicatory hearing on grounds that the agency should have acted by rule under section 4 of the Administrative Procedure Act rather than by order under section 5. The Court said:
15
Not every principle essential to the effective administration of a statute can or should be cast immediately into the mold of a general rule. Some principles must await their own development, while others must be adjusted to meet particular, unforeseeable situations. In performing its important functions in these respects, therefore, an administrative agency must be equipped to act either by general rule or by individual order. To insist upon one form of action to the exclusion of the other is to exalt form over necessity.
16
In other words, problems may arise in a case which the administrative agency could not reasonably foresee, problems which must be solved despite the absence of a relevant general rule. Or the agency may not have had sufficient experience with a particular problem to warrant regidifying its tentative judgment into a hard and fast rule.... In those situations, the agency must retain power to deal with the problems on a case-to-case basis if the administrative process is to be effective. There is thus a very definite place for the case-by-case evolution of statutory standards. And the choice made between proceedings by general rule or by individual, ad hoc litigation is one that lies primarily in the informed discretion of the administration agency.
17
Id. at 202-03, 67 S.Ct. at 1580.
18
Contrary to plaintiffs' argument, Congress itself has not required the Commission to engage in rule making respecting "margin" and "leverage" contracts prior to adjudication. The statute permits cash contracts off the commodities exchanges, but requires futures contracts to be executed through the exchanges. With respect to "margin" and "leverage" contracts-terms left undefined by the statute-Congress has provided with respect to most commodities that such contracts are illegal. 7 U.S.C. § 23(a). With respect to "margin" and "leverage" contracts for gold and silver Congress has provided as follows:
19
No person shall offer to enter into ... any transaction ... under a standardized contract described in subsection (a) of this section, contrary to any rule, regulation, or order of the Commission designed to ensure the financial solvency of the transaction or prevent manipulation or fraud: Provided, that such rule, regulation, or order may be made only after notice and opportunity for hearing.
20
7 U.S.C. § 23(b) (Emphasis added). Under this provision of the statute, Congress does not expressly or by implication limit regulation of gold and silver "margin" and "leverage" contracts to rule making. It delegates authority to regulate by "order," i.e. adjudicatory proceedings, as well. We find nothing in the text of the statute or in the legislative history of the statute indicating an intent to prohibit the Commission from regulating metals contracts by adjudication. Nothing in the statute indicates that Congress intended for the Commission to act by rule before it acts by order so long as the parties are given notice and an opportunity to be heard.
21
The Circuit and District Court cases cited by plaintiffs for the proposition that the agency must act by rule before it acts by order are not in point. In Patel v. Immigration and Naturalization Service, 638 F.2d 1199 (9th Cir. 1980) and Ford Motor Company v. Federal Trade Commission, 654 F.2d 599 (9th Cir. 1981) (withdrawn from publication for reconsideration), the court had before it final agency decisions after adjudicatory hearings, including complete factual administrative records. The Court did not have to speculate about the facts, the nature of the industry, the administrative standard to be applied, the remedy or sanction to be imposed and the effect on non-parties similarly situated. This distinction is crucial. Judicial insistence on clear administrative findings and reasoned decision making as a condition of review and enforcement is irrelevant if courts are going to decide the correctness of the agency's procedures, remedies and substantive rules and principles before the agency ever hears the case. It may be that the agency's findings will be erroneous because the agency's law respecting commodities contracts will be erroneous. But we do not know at this point. We cannot decide that question before the findings are made and the law is developed. We will have "final agency action" to review when that process is complete. The issuance of the complaint is not final.
22
Accordingly, the judgment of the District Court is reversed.Order of Clarification
23
Subsequent to the decision of this Court in this case filed May 3, 1982, the appellant timely petitioned the Court pursuant to Rule 40(a), Fed.R.App.P., for the Court to clarify its opinion. In the recitation of facts the Court stated at page 524-525 of its opinion:
24
On November 20, 1979, the Commission moved back the effective date of its decision to treat forward contracts as futures contracts until June 30, 1980. On May 28, 1980, the postponement date was extended to October 1, 1982. (emphasis added)
25
This statement refers to decisions made by the Commission in the context of its rulemaking proceeding concerning leverage contracts involving gold and silver bullion and bulk coins. The question whether the "forward" or "cash forward" contracts offered by the plaintiffs are leverage contracts is an issue to be resolved in the administrative adjudicatory proceeding. To avoid any ambiguity the opinion of this Court should be clarified by substituting the words "leverage contracts" for the words "forward contracts." In all other respects the court adheres to its original opinion. | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1919058/ | 218 A.2d 520 (1966)
Edward G. BELL, Appellant,
v.
DISTRICT OF COLUMBIA, Appellee.
No. 3858.
District of Columbia Court of Appeals.
Argued March 7, 1966.
Decided April 15, 1966.
Rehearing Denied April 26, 1966.
*521 Francis L. Young, Jr., Washington, D. C., with whom Jackson, Gray & Laskey, Washington, D. C., was on the brief, for appellant.
David P. Sutton, Asst. Corporation Counsel, with whom Chester H. Gray, Corporation Counsel, Milton D. Korman, Principal Asst. Corporation Counsel, and Hubert B. Pair, Asst. Corporation Counsel, were on the brief, for appellee.
Before HOOD, Chief Judge, and QUINN and MYERS, Associate Judges.
MYERS, Associate Judge.
This is an appeal by Edward G. Bell from his conviction of operating an automobile at an unreasonable rate of speed.[1] He contends the evidence was insufficient to sustain the charge against him.
A detailed recitation of the testimony would serve no useful purpose here. Although admittedly the evidence was in conflict with respect to the speed of the vehicle at the time it struck a ten-year-old pedestrian, the origin, length and cause of the skid-marks on the street, and whether they were made by appellant's car, the record in our opinion fully warrants the finding by the trial judge that appellant was guilty of the traffic charge of unreasonable speed.[2] Resolution of the factual issues, based on the weight of the evidence and the credibility of the witnesses as assessed by the trial judge, is solely within his province, and we are not empowered to substitute any views we might hold in disagreement.[3]
Appellant also alleges it was error to admit the testimony of a police officer who stated that, based on his examination of the skid-marks left by appellant's automobile, appellant was traveling forty miles an hour in a school zone where, at the time of the accident, the rate of speed was limited to fifteen miles per hour. Appellant complains he had not been qualified to testify as an expert. The witness, a member of the police force for more than two years, was a trained officer with the Accident Investigation Unit. A very important *522 part of his work is to judge the speed of motor vehicles involved in collisions. His qualifications in this field, based upon his actual investigative activities, his own driving background, and his study of books covering the subject of estimating speed from skid-marks, were fully explored during cross-examination. We find no abuse of discretion in admitting his testimony for its consideration by the trial judge, together with all other relevant evidence surrounding the rate at which appellant was travelling at the time of the accident.[4] In any case, the issue was not the exact speed but whether appellant's speed at the time of the accident was unreasonable in view of the conditions and hazards, actual or potential, then existing; and, aside from the officer's testimony, there was other competent evidence to substantiate the finding of the trial judge.
We have considered the other contentions by appellant and find them to be without merit.
Affirmed.
NOTES
[1] "No person shall drive a vehicle on a street or highway at a speed greater than is reasonable and prudent under the conditions and having regard to the actual and potential hazards then existing. In every event speed shall be so controlled as may be necessary to avoid colliding with any person. * * *" Traffic and Motor Vehicle Regulations for the District of Columbia, Part I, Article VI, Sec. 22(a).
[2] Graham v. District of Columbia, D.C. Mun.App., 127 A.2d 150 (1956). Compare Paschal v. District of Columbia, D.C.App., 206 A.2d 402 (1965).
[3] Lipsey v. Harriet, D.C.App., 192 A.2d 529 (1963).
[4] Riley v. District of Columbia, D.C.App., 207 A.2d 121 (1965); Benjamin v. Hot Shoppes, Inc., D.C.Mun.App., 185 A.2d 512 (1962). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4558358/ | Fourth Court of Appeals
San Antonio, Texas
August 21, 2020
No. 04-20-00248-CR
The STATE of Texas,
Appellant
v.
Joe DIAZ,
Appellee
From the County Court, Kinney County, Texas
Trial Court No. 10176CR
Honorable Tully Shahan, Judge Presiding
ORDER
On July 27, 2020, the State filed a motion for extension of time to file the State’s brief
until August 31, 2020 on the basis that the State was awaiting a supplemental clerk’s record. On
August 17, 2020, this court ordered the trial court clerk to file the supplemental clerk’s record by
August 31, 2020. In light of this court’s prior order, the State’s motion for extension is
GRANTED as follows: the State’s brief is due no later than September 30, 2020. Further
requests for extension of time to file the State’s brief will be disfavored.
_________________________________
Sandee Bryan Marion, Chief Justice
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said
court on this 21st day of August, 2020.
___________________________________
MICHAEL A. CRUZ,
Clerk of Court | 01-03-2023 | 08-25-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3037095/ | FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
AMERISOURCEBERGEN CORPORATION,
a New Jersey corporation, dba
Bergen Brunswig Corporation, aka
BBC; AMERISOURCEBERGEN DRUG
CORPORATION; MEDICAL INITIATIVES,
INC., aka Oncology Supply; ASD No. 04-15595
SPECIALTY HEALTHCARE, INC.,
Plaintiffs-Appellants, D.C. No.
CV-02-01472-JWS
v.
DIALYSIST WEST, INC., an Arizona District of
Arizona, Phoenix
corporation, ORDER
Defendant-Appellee, AMENDING
v. OPINION
AMERX INC., a Florida corporation;
CSG DISTRIBUTORS, a Tennessee
company; PREMIER MEDICAL
DISTRIBUTORS, INC.,
Third-party-Defendants.
Filed April 24, 2006
Before: Jerome Farris, A. Wallace Tashima, and
Consuelo M. Callahan, Circuit Judges.
ORDER
The opinion filed on March 22, 2006 is amended as fol-
lows: on slip opinion page 3046, lines 10-16, the following
sentences are deleted: “AmerisourceBergen contends, how-
ever that the contracts for sale of Epogen and other drugs
4563
4564 AMERISOURCEBERGEN v. DIALYSIST WEST
were not separate contracts. Because the Vendor Agreement
signed by Dialysist West permits AmerisourceBergen to
return any goods to Dialysist West for “full credit,” Ameri-
sourceBergen believes it was justified in applying the credit
it held for the counterfeit Epogen purchases against its out-
standing debts.”
The following sentences are added on slip opinion page
3046, at line 10: “AmerisourceBergen concedes that the con-
tracts for sale of Epogen and the other drugs were separate
contracts. But because the Vendor Agreement signed by Dia-
lysist West permits AmerisourceBergen to return any goods
to Dialysist West for “full credit,” AmerisourceBergen
believes it was justified in applying the credit it held for the
counterfeit Epogen purchases against its outstanding debts.”
PRINTED FOR
ADMINISTRATIVE OFFICE—U.S. COURTS
BY THOMSON/WEST—SAN FRANCISCO
The summary, which does not constitute a part of the opinion of the court, is copyrighted
© 2006 Thomson/West. | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/4558357/ | Fourth Court of Appeals
San Antonio, Texas
August 21, 2020
No. 04-20-00252-CR
The STATE of Texas,
Appellant
v.
Manuel LEAL,
Appellee
From the County Court, Kinney County, Texas
Trial Court No. 10226CR
Honorable Tully Shahan, Judge Presiding
ORDER
On July 27, 2020, the State filed a motion for extension of time to file the State’s brief
until August 31, 2020 on the basis that the State was awaiting a supplemental clerk’s record. On
August 17, 2020, this court ordered the trial court clerk to file the supplemental clerk’s record by
August 31, 2020. In light of this court’s prior order, the State’s motion for extension is
GRANTED as follows: the State’s brief is due no later than September 30, 2020. Further
requests for extension of time to file the State’s brief will be disfavored.
_________________________________
Sandee Bryan Marion, Chief Justice
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said
court on this 21st day of August, 2020.
___________________________________
MICHAEL A. CRUZ,
Clerk of Court | 01-03-2023 | 08-25-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1427744/ | 117 S.W.3d 113 (2002)
Scott D. BARMORE, Movant/Appellant,
v.
STATE of Missouri, Respondent.
No. ED 80470.
Missouri Court of Appeals, Eastern District, Division Four.
November 26, 2002.
Motion for Rehearing and/or Transfer Denied January 27, 2003.
Case Transferred April 1, 2003.
Case Retransferred October 28, 2003.
Original Opinion Reinstated November 7, 2003.
*114 Raymund Jared Capelovitch, Assistant Public Defender, St. Louis, MO, for Appellant.
Jeremiah W. (Jay) Nixon, Atty. Gen., Audara L. Charlton, Assistant Attorney General, Jefferson City, MO, for Respondent.
Before WILLIAM H. CRANDALL, P.J., SHERRI B. SULLIVAN and GLENN A. NORTON, JJ.
Motion for Rehearing and/or Transfer to Supreme Court Denied January 27, 2003.
Case Transferred to Supreme Court April 1, 2003.
Case Retransferred to Court of Appeals October 28, 2003.
GLENN A. NORTON, Judge.
Movant, Scott D. Barmore, appeals from the judgment denying his Rule 24.035 motion for post-conviction relief without an evidentiary hearing. We affirm.
On October 30, 1998, pursuant to a plea agreement, Movant pleaded guilty to one count of first degree robbery in violation of section 569.020, RSMo 2000 (Count I) and one count of second degree robbery in violation of section 569.030, RSMo 2000 (Count II). In the plea agreement, the State agreed to recommend sentences of ten years' imprisonment on Count I and five years' imprisonment on Count II and to not oppose Movant's request for probation. The plea agreement further stated that if probation were granted, certain special conditions would be attached. At the plea hearing, the court informed Movant about the nature of the charges against him and the statutory range of punishment for each offense, and explained that Movant was waiving his right to trial and the constitutional guarantees attached thereto. Movant stated he understood this information and continued to plead guilty. After the plea court accepted his plea, Movant requested that a pre-sentence investigation be conducted.
On January 15, 1999, the sentencing court, which was presided over by a different judge than the plea court, suspended imposition of sentence and placed Movant on probation with special conditions for five years. Just prior to granting probation, the sentencing court warned Movant that, if he violated his probation, the court could impose a sentence of up to thirty years or life imprisonment, the maximum sentence provided for by statute.
Fourteen months later, the court revoked Movant's probation and sentenced him to concurrent prison terms of twenty years and ten years, respectively.
Movant filed a timely pro se Rule 24.035 motion for post-conviction relief, which appointed counsel amended. The motion court denied movant's amended motion without an evidentiary hearing. The court reasoned that the record refuted Movant's factual allegations. Movant appeals.
Our review is limited to determining whether the motion court's findings and conclusions are clearly erroneous. Rule 24.035(k). The findings and conclusions are clearly erroneous only if, after reviewing *115 the entire record, we are left with the definite and firm impression that a mistake has been made. Reynolds v. State, 994 S.W.2d 944, 945 (Mo. banc 1999).
We will grant an evidentiary hearing to a movant only if: (1) his motion alleged facts, rather than conclusions, warranting relief; (2) the factual allegations were not refuted by the record; and (3) the matters complained of resulted in prejudice to the movant. Coates v. State, 939 S.W.2d 912, 914 (Mo. banc 1997). If the files and records conclusively show that the movant is entitled to no relief, then a hearing shall not be held. Rule 24.035(h). After entering a guilty plea, a claim of ineffective assistance of counsel is material only to the extent it affected the voluntariness or understanding with which the plea was entered. Rick v. State, 934 S.W.2d 601, 605 (Mo.App. E.D.1996).
In his sole point relied on, Movant argues the motion court clearly erred in denying his Rule 24.035 motion without an evidentiary hearing because he entered his plea unknowingly and involuntarily, due to his attorney's ineffective assistance. He alleges that his attorney failed to inform him that if he violated his probation, the court could impose any sentence within the statutory range of punishment, including sentences greater than those the State recommended in the plea agreement. He further alleges that, had he known this information, he would have insisted upon going to trial instead of pleading guilty.
The State concedes that the motion court clearly erred in denying Movant an evidentiary hearing. However, we do not. Instead, we find no clear error, because Movant's factual allegations, even if proven true, do not warrant relief.
To prevail on a claim of ineffective assistance of counsel, Movant must show his attorney failed to exercise the customary skill and diligence of a reasonably competent attorney under similar circumstances and Movant was thereby prejudiced. Strickland v. Washington, 466 U.S. 668, 687, 104 S.Ct. 2052, 2064, 80 L.Ed.2d 674 (1984). There is a basic duty imposed on counsel to discuss with a defendant the possible consequences involved in the case, including the range of possible punishment. Brown v. State, 67 S.W.3d 708, 710 (Mo.App. E.D.2002). But counsel only has an obligation to inform a defendant of the "direct" consequences of a guilty plea and has no duty to inform a defendant of the "collateral" consequences of pleading guilty. Id. Accordingly, counsel's failure to advise a defendant regarding collateral consequences of a guilty plea cannot rise to the level of constitutionally ineffective assistance of counsel. Id.
Direct consequences are those which "definitely, immediately, and largely automatically follow the entry of a guilty plea." Huth v. State, 976 S.W.2d 514, 516-517 (Mo.App. E.D.1998). Here, the prison terms imposed on Movant did not immediately or automatically follow his guilty plea. They were imposed only after and because Movant violated his probation. Therefore, we hold that Movant's re-sentencing following his probation violation was a collateral, not direct, consequence of his guilty plea. Both Missouri and other jurisdictions have reached similar conclusions. Cf. Huffman v. State, 703 S.W.2d 566, 567-68 (Mo.App. S.D.1986)("the sentencing alternatives open to the trial court should the defendant violate his parole [were collateral consequences]"); Parry v. Rosemeyer, 64 F.3d 110, 114-115 (3rd Cir. 1995). The Parry court explained,
[a] sentence of imprisonment upon revocation of probation is not generated by the plea but by the defendant's own unwillingness or inability to conform to the restrictions imposed as part of probation. Therefore, a term of imprisonment *116 imposed in place of a revoked term of probation would be a direct consequence of violating a condition of probation, but not of pleading guilty. Id.
Since Movant's counsel had no obligation to inform him about the potential consequences of violating probation, counsel's alleged failure to advise Movant about those potential consequences does not constitute ineffective assistance nor does it render his guilty plea involuntary.[1]Brown, 67 S.W.3d at 710.
We further reject Movant's assertion that, at the very least, the sentencing court should have afforded him the opportunity to withdraw his guilty plea after warning him the court could impose a sentence of up to thirty years or life imprisonment, if he violated probation. First, we note the sentencing court's warning was advisory, not mandatory. Like counsel, the court had no obligation to inform Movant of the collateral consequences of pleading guilty. Price v. State, 974 S.W.2d 596, 599 (Mo.App. E.D.1998). Second, we find Rule 24.02(d)(4), which Movant impliedly relies on, inapplicable. The Rule mandates that should the sentencing court reject the plea agreement reached by the parties, the court shall: a) inform the parties of this fact; b) advise the defendant personally the court is not bound by the plea agreement; c) afford the defendant the opportunity to withdraw his plea; and d) advise the defendant that if he persists in his guilty plea, the disposition of the case may be less favorable to the defendant than that contemplated by the plea agreement. Rule 24.02(d)(4). However, the sentencing court did not reject the plea agreement here. Although Movant eventually received prison terms greater than those expressed in the plea agreement, the probation revocation court, not the sentencing court, imposed those sentences. The sentencing court, on the other hand, placed Movant on probation, a disposition contemplated by the plea agreement. Movant received the benefit of his bargain. Therefore, Rule 24.02(d)(4) did not mandate the sentencing court afford Movant an opportunity to withdraw his plea. See, Lawson v. State, 757 S.W.2d 646, 647-648 (Mo.App. E.D.1988). Point denied.
We affirm the judgment of the motion court.
WILLIAM H. CRANDALL, P.J. and SHERRI B. SULLIVAN, J. concurring.
NOTES
[1] Movant did not allege, in his motion or his point relied on, that his counsel affirmatively misrepresented the potential consequences of violating his probation, but only alleged that his counsel remained silent. See Copas v. State, 15 S.W.3d 49, 55-56 (Mo.App. W.D. 2000). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645211/ | 994 So.2d 20 (2008)
STATE ex rel. Cedric WASHINGTON
v.
STATE of Louisiana.
No. 2008-KH-1779.
Supreme Court of Louisiana.
October 10, 2008.
This application is transferred to the Fifth Circuit Court of Appeal for consideration pursuant to the procedures outlined in that court's en banc resolution of September 9, 2008. See State v. Cordero, 08-1717 (La.10-03-08), 993 So.2d 203.
WEIMER, J., concurs in part and dissents in part for the reasons assigned in State v. Cordero, 08-1717 (La.10-03-08), 993 So.2d 203. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1736664/ | 519 So. 2d 132 (1988)
STATE of Louisiana
v.
Pete BAILEY, Jr.
No. 87-K-2234.
Supreme Court of Louisiana.
February 5, 1988.
*133 Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/405056/ | 680 F.2d 183
220 U.S.App.D.C. 147
UNITED STATES of Americav.James K. GREEN, Appellant.
No. 80-2461.
United States Court of Appeals,District of Columbia Circuit.
Argued June 16, 1981.Decided May 21, 1982.
Appeal from the United States District Court for the District of Columbia (Criminal No. 00729-68).
Charles G. Cole, Washington, D. C. (appointed by this Court), for appellant.
Susan R. Holmes, Asst. U. S. Atty., Washington, D. C., with whom Charles F. C. Ruff, U. S. Atty., Washington, D. C., at the time the brief was filed, John A. Terry and Michael W. Farrell, Asst. U. S. Attys., Washington, D. C., were on the brief, for appellee.
Before BAZELON, Senior Circuit Judge, and WILKEY and WALD, Circuit Judges.
Opinion PER CURIAM.
1
Dissenting opinion filed by Senior Circuit Judge BAZELON.
PER CURIAM:
2
In this appeal, James Green challenges the district court's denial without a hearing of his motion under the federal habeas corpus statute, 28 U.S.C. § 2255. Green sought modification of the 10-30 year prison sentence imposed after his conviction of armed rape, armed robbery, armed burglary and assault with and possession of a dangerous weapon. Green did not dispute the validity of the underlying convictions which were upheld on appeal in 1970;1 the issue before the district court was whether Green had been denied due process or his sixth amendment right to effective assistance of counsel at the sentencing. Section 2255 does not require the district court to hold a hearing on the motion if "the files and records of the case conclusively show that the prisoner is entitled to no relief," and the district court so decided here. We hold that the district court's appraisal of the record was correct and that Green was not entitled to relief. He was neither denied due process at the sentencing stage nor was his sentence tainted by ineffective assistance of counsel under the standards set forth in United States v. Decoster, 624 F.2d 196 (D.C.Cir.) (en banc), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979).
I.
3
Green was represented at his five-day trial by retained counsel of his choice. On November 6, 1968, the jury found Green guilty of the armed rape and robbery of a Washington, D. C. resident in her home. He was also found guilty of first degree burglary and illegal assault with and possession of a loaded gun. The facts of the crime were recounted by the district court:
4
The defendant followed Mrs. Lilia Pearce, a 26-year old, white female into her residence on March 27, 1968. He waited until she was leaving again and asked her where the janitor was located. Mrs. Pearce took the defendant downstairs, where he shoved her into a corner, pointed a gun at her head, and threatened to kill her if she would not give him her money. He then pulled her back up the stairs to her apartment. Once inside, he forced her into each room, asking what she had of value. Mrs. Pearce turned over $100.00. The defendant then forced Mrs. Pearce onto the bed where he made her take off her clothes and then had sexual relations with her. When he finished, he tied her hands, gagged her and forced her into a closet, against which he put a duffel bag before leaving.
5
United States v. Green, No. 729-68 at 1 (Nov. 7, 1980) (memorandum order denying § 2255 motion).
6
Subsequent to Green's conviction, the probation office for the district court prepared a presentence report, which detailed both the government's and Green's versions of the offense, explained that Green had no previous arrest record (though he was AWOL from the Army at the time of his offense), discussed various aspects of his background, and concluded with an "Evaluative Summary." The evaluative summary contained a review of Green's personal history and attitudes including observations on his propensity to "project responsibility onto others, particularly the police, the Assistant U. S. Attorney, and even his own lawyer." The report summed up with the comment that "(i)n any event, it would seem that the conviction and circumstances of the offense outweigh other considerations. In all likelihood, Green presents a real threat to others in the community, should he again choose to victimize someone."2 The presentence report also included the statement that "Green said he felt his lawyer was incompetent and that, perhaps there was a conspiracy between his lawyer and the Assistant U. S. Attorney," although Green could offer no motivation for such a conspiracy.
7
Green's sentencing hearing, at which he was represented by trial counsel, was held on January 3, 1969. We quote the hearing transcript virtually in its entirety:
8
(COUNSEL): In this case, if it please the Court, I am almost in a position where I feel I need counsel, for this defendant, I think I should say for the record, has totally repudiated this humble counsel.
9
THE COURT: I don't hear you.
10
(COUNSEL): I say this defendant has totally repudiated this humble counsel and so all I can say is that this is a young man. He is in military service. I think that there must be within him seeds for rehabilitation. The Court has a total probation record on James K. Green, and I am sure the Court remembers the trial for we went through it for several days and in at least this counsel's opinion tried as best we could to give him full and fair representation.
11
THE COURT: Indeed, it was the Court's opinion that he was afforded the finest of counsel.
12
(COUNSEL): So we would therefore submit him to the Court and ask the Court to hear him say anything he desires to say.
13
THE COURT: Mr. Green.
14
THE DEFENDANT: Your Honor, I would like to ask the Court a couple of questions, if I may.
15
THE COURT: You just tell us what you have to say. The Court isn't interrogated.
16
THE DEFENDANT: I have nothing to say.
17
THE COURT: Nothing to say? ... (T)he Court sentences the defendant James K. Green to be incarcerated for a period of not less than ten years nor more than thirty years in a penal institution to be designated by the Attorney General or his authorized representative. You have ten days in which to note an appeal.
18
(COUNSEL): Your Honor, I will go down immediately and get the necessary forms and furnish them to the defendant. I feel that this is my duty. And after that I ask the Court that I be relieved in this case.
19
THE COURT: There is a new rule of the Court that you may be familiar with, that asks that trial counsel stay on to assist counsel who may be appointed in the appellate case.
20
(COUNSEL): Of course I will be happy to do that.3
21
On Green's appeal of his convictions, he was represented by new counsel appointed by this court. The convictions were affirmed by a unanimous panel in an opinion written by then Chief Judge Bazelon. In the course of that appeal, new counsel did not raise any issue regarding error in Green's sentencing nor allege ineffective assistance of counsel at any stage of the proceedings. While the appeal was pending, Green brought a pro se motion for a new trial alleging ineffective assistance by virtue of counsel's failure to file certain pretrial motions, but did not mention any defects in either the trial or the sentencing process. That motion was denied without opinion, and no appeal was taken.
22
Green served four years of his 10-year sentence and then escaped from prison, remaining free from 1973-1977. Upon his recapture, he was sentenced to an additional year in prison. In January 1982, he was released to the community under parole supervision.
23
Green had filed his habeas motion pro se on August 7, 1980, some 111/2 years after his conviction, claiming that he was sentenced on the basis of willfully false and prejudicial information in the presentence report,4 and that he was denied effective assistance of counsel at the sentencing hearing5 in that counsel did not disclose to him the contents of the presentence report nor seek to correct purported errors in the report before the sentencing judge. The only reference he made to any conflict or rift between them at the time of sentencing which might have adversely affected her representation of him was his speculation that she was "concerned" about the dissatisfaction with her that he had expressed in the presentence report. In accordance with the rules governing section 2255 proceedings, 28 U.S.C. foll. § 2255 Rule 4(a), Green's motion was referred to the district judge who had originally sentenced him. In opposition to Green's motion, the government filed affidavits by the author of the presentence report and by defendant's trial counsel to show that Green's allegations of errors in the report were either incorrect or immaterial6 and that Green's attorney had given him competent representation.7 Counsel's affidavit stated that she had reviewed the presentence report with Green, and that though Green was unhappy with the report, counsel found it "accurate in all material respects" and "consistent with counsel's impressions of Mr. Green and with the information he had given (counsel) about himself." The affidavit also claims that although Green had asked counsel to correct the report, he did not provide counsel with "any legal or factual basis for these wishes." Furthermore, counsel "believed it would be unwise, tactically, to challenge the report in the manner suggested by the defendant." Counsel did, however, advise Green that he could voice his objections to the court at the sentencing hearing. Finally, the affidavit states: "I knew that Mr. Green was displeased with me in this regard and I so advised the Court, but I did not seek to withdraw because Mr. Green himself asked me to remain in the case."
24
The record having been thus supplemented, as permitted by the section 2255 rules, 28 U.S.C. foll. § 2255 Rule 7,8 the district court chose to avail itself of those procedures that "enable the judge to dispose of some habeas petitions not dismissed on the pleadings, without the time and expense required for an evidentiary hearing." Blackledge v. Allison, 431 U.S. 63, 82, 97 S. Ct. 1621, 1633, 52 L. Ed. 2d 136 (1977). Upon examination of the "files, records, transcripts, and correspondence relating to the judgment under attack," 28 U.S.C. foll. § 2255 Rule 4(b), to determine whether the "facially adequate allegations (had) sufficient basis in fact to warrant plenary presentation of evidence," 431 U.S. at 80, 97 S.Ct. at 1632, the court denied Green's motion without an evidentiary hearing. Cf. United States v. Boggs, 612 F.2d 991 (5th Cir.), cert. denied, 449 U.S. 857, 101 S. Ct. 156, 66 L. Ed. 2d 72 (1980) (no need for evidentiary hearing where district judge who dismissed defendant's motion was same judge who imposed sentence and was familiar with defendant's situation). The memorandum order defining the reasons for dismissing the due process and competence claims, stated that "(t)he alleged errors pointed to in the presentence report" had not been "material to the Court's determination of sentence." United States v. Green, supra, at 1. Rather, the memorandum order recalls that the court had "read the entire record including the presentence report, and it relied primarily on the facts of the crime and the trial testimony in making its sentencing decision," id. at 2, and, additionally, that Green's counsel had represented him competently, id. at 3. Green appealed the district court order of dismissal to this court and counsel was appointed on his behalf.
II.
25
We dispose first of Green's principal attack that he was sentenced on the basis of prejudicial and willfully false material supplied by the probation officer. We note that Judge Bazelon's dissent agrees that Green has made out no case on this ground. Diss. Op. at 192 n.3. Relying on Townsend v. Burke, 334 U.S. 736, 68 S. Ct. 1252, 92 L. Ed. 1690 (1948), and United States v. Bass, 535 F.2d 110 (D.C.Cir.1976), appellant's due process claim rests on the assertion that he was sentenced on the basis of materially false information. In Townsend, "the Supreme Court held that the due process clause was violated when a defendant ... 'was sentenced on the basis of assumptions concerning his criminal record which were materially untrue.' " United States v. Bass, 535 F.2d at 118 (quoting Townsend v. Burke, 334 U.S. at 741, 68 S.Ct. at 1255). Beyond the fact that the district court expressly recalled that the challenged statements in the presentence report were not material to the determination of the sentence, the record shows that the presentence report did not contain materially "false assumptions." Townsend v. Burke, 334 U.S. at 740, 68 S.Ct. at 1255.
26
Green's motion lists six inaccuracies in the presentence report. First, Green complains that the report stated that bail was denied him due to the Bail Agency's inability to find community ties. The transcript of Green's preliminary hearing on April 9, 1968, shows that the presiding judge set bail at $25,000 because of the strength of the case against Green and because Green was not at that time a resident of the District of Columbia. Transcript of Preliminary Hearing at 34-37. Green remained incarcerated, and filed a pro se motion for release on personal bond on August 8, 1968. The Bail Agency submitted its report on August 15, 1968, recommending against release on personal recognizance because it had been unable to verify the information supplied by Green. A hearing on Green's motion was, according to a notation in the district court record, "continued pending report from military." Court Clerk's Memorandum for August 30, 1968. In sum, the presentence report was substantially correct on this point.
27
Green next disputes that the author of the report was unable to locate the District Roma Bakery where Green reported that he had worked for five or six years prior to his induction into the Army. He claims that no attempt was made to contact his former employer, and submitted with his motion a listing in the 1976 District of Columbia phone book for a "Roma-Italian Bread Corp." at the same address he had given the probation office in 1968. The government, however, submitted with its Opposition an envelope supporting the contention that a request for information was sent to "District Rona Baking Company" at 1644 North Capitol Street and was returned marked "Moved, left no address." Further, the report did not infer from the failure to locate the company that Green had lied. On the contrary, the report assumed that Green resigned from a previous job "to work for the baking company."
28
Green also objected that the report implied that he was "a person who tells lies" through the account that "According to military records, Green entered the service not in March of 1967, as he said, but on October 6, 1967." The government concedes that the report is in error, but, in the absence of any indication that Green had something to gain from a misrepresentation, the error does not render the report prejudicial, and was certainly not "material."
29
Green's fourth objection to the report is the characterization, in the evaluative summary, of his relationship with his natural father:
30
Green has occasionally maintained contact with his natural father, though he never really assumed any parental responsibility for Green.
31
Appellant disputes the accuracy of this statement with a statement from his natural father that "my son ... has always had my Moral and Financial support." Green, however, does not otherwise dispute the report's account of his family history which describes a close relationship between Green and his stepfather, who, with Green's mother, "provided adequately for him," since Green was two years old and who "expressed concern about the offense for which he has been charged ... and continue(d) to support him despite his incarceration." Thus, Green does not reject the basis for concluding that his stepfather, rather than his natural father, assumed the parental role in the nuclear family.
32
Green's final objections address statements in the report which on their face are clearly the opinions of the author and not "assumptions" at all. The author states that Green's "style of dress and behavior seemed to indicate effeminate characteristics, but he denied ever engaging in homosexual activities," and that "it would seem that the conviction and circumstances of the offense outweigh other considerations. In all likelihood, Green presents a real threat to others in the community ...."
33
Green's allegations, neither individually nor in the aggregate, establish the report as "materially false," and, therefore, Green's due process claim must fail.
III.
34
With regard to his claim of ineffective assistance, Green makes three allegations on appeal. First, he claims that trial counsel did not discuss the presentence report with him nor disclose its contents. Green's supposition is that trial counsel was concerned about the presentence report's account of Green's dissatisfaction with counsel. Second, Green alleges that trial counsel made no other attempt to verify or refute the information in the report. Third, he argues that trial counsel provided ineffective assistance by failing to comment on the inaccuracies in the report or otherwise effectively advocate at the sentencing hearing. Green attributes the 111/2 year delay in filing his motion to his prior lack of knowledge of the contents of the report, but does not explain how he came by it at this late date.9
35
We do not suggest that counsel's preparation for and conduct at the sentencing hearing was a model of vigor. And we agree that Green "was as much entitled to effective representation by counsel at sentencing as at any other critical stage of his trial." United States v. Pinkney, 543 F.2d 908, 914 (D.C.Cir.1976); see American Bar Association Project on Standards for Criminal Justice, Standards Relating to Sentencing Alternatives and Procedures § 5.3(e) (1968) ("The defense attorney should recognize that the sentencing stage is the time at which for many defendants the most important service of the entire proceeding can be performed."). But we do not find it necessary to decide whether counsel's conduct constituted "a serious incompetency that (fell) measurably below the performance ordinarily expected of fallible lawyers." United States v. Decoster, 624 F.2d 196, 208 (D.C.Cir.) (en banc) (plurality opinion per Leventhal, J.), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979). This court has repeatedly maintained that to establish a deprivation of the sixth amendment's guarantee, absent a "governmental impediment to effective assistance of counsel," 624 F.2d at 214, "the accused, though ineffectively represented, must further show a likelihood of harm therefrom, and that only then does the government face the need to disprove actual injury." United States v. Wood, 628 F.2d 554, 561 (D.C.Cir.1980) (Robinson, J., concurring in part and dissenting in part). See United States v. Hinton, 631 F.2d 769, 771 (D.C.Cir.1980) (per Bazelon, J.); United States v. Decoster, 624 F.2d at 208.
36
In Decoster, this court considered en banc the appeal of a conviction challenged on the basis of ineffective assistance of counsel. Each of the appellant's various claims of defective performance were rejected in turn because the appellant failed to show that the attorney's failings had a likely impact on the result of the trial. We also said in Decoster that, depending on the nature of the claim, differing standards obtain to establish a violation of the sixth amendment guarantee that "(i)n all criminal prosecutions, the accused shall ... have the Assistance of Counsel for his defense." Where the government refuses to make counsel available to an indigent defendant or where the government interferes to restrict effective representation, a per se rule applies that the conviction be reversed. See United States v. Decoster, 624 F.2d at 201 (citing, inter alia, Geders v. United States, 425 U.S. 80, 96 S. Ct. 1330, 47 L. Ed. 2d 592 (1976); Gideon v. Wainwright, 372 U.S. 335, 83 S. Ct. 792, 9 L. Ed. 2d 799 (1963)). "At the other end of the continuum are cases, including the present one, in which the issue is counsel's performance when ... 'untrammeled and unimpaired' by state action." 624 F.2d at 202 (quoting Holloway v. Arkansas, 435 U.S. 475, 482, 98 S. Ct. 1173, 1177, 55 L. Ed. 2d 426 (1978)). Judge Leventhal's opinion adopted the view that in such a case, "involving the quality of performance, as reflected in acts or omissions at trial," 624 F.2d at 203, the defendant must demonstrate "a likelihood of effect on the outcome." 624 F.2d at 215. A per se rule may serve a deterrent purpose where government action is involved, but no such justification exists for vacating a trial court's judgment when only individual counsel's allegedly incompetent behavior is implicated. But cf. Address by the Honorable David L. Bazelon, Robert S. Marx Lectures, U. of Cincinnati (Dec. 6-7, 1972), reprinted as The Defective Assistance of Counsel, 42 U.Cin.L.Rev. 1, 30 (1973) (if specific breaches of counsel's duty of care were presumed to be sixth amendment violations, courts would develop clear standards of performance). Where deterrence of unconstitutional government action is not at issue, then, our concern must be focused on whether the defendant has suffered a palpable injustice as a result of counsel's substandard performance. See United States v. Decoster, 624 F.2d at 214.
37
This case falls squarely within the category which concentrates on the possible injustices in the individual case, and here appellant has made no showing of "likelihood of effect on the outcome." In fact, the record shows just the reverse. The single disputed issue of fact, i.e., whether counsel showed Green the presentence report, is immaterial because Green has failed to show that any harm likely resulted, even if his version of the facts is credited. Green argues that he could have identified errors and omissions for counsel. He further argues that counsel should have verified and brought to the court's attention favorable evidence of Green's employment history, work habits and positive family relationships in order to correct the impression that Green had lied to the probation officer about his place of employment, and to alert the court to Green's previous stability and reliability. But, as the dissent apparently concedes, the report was substantially correct, did not imply that Green had lied about his employment, and not unfavorably described his home environment. Green has identified no additional facts that might have been raised by counsel to sway the judge toward leniency. Further, while the district court judge was satisfied with counsel's competence and so did not address the likelihood that Green was prejudiced by his attorney's alleged incompetence, the judge effectively ruled out the possibility of prejudice emanating from the alleged deficiencies in counsel's performance. She has specifically said that in imposing a 10-30 year sentence she "relied primarily on the facts of the crime and the trial testimony,"10 that she had read the entire presentence report and that "the alleged errors ... were not material" to her determination, and "that the defendant's actions merited the imposition of the sentence given." United States v. Green, supra, at 1, 2. We have no reason to doubt the validity of the court's statement about the reasons for the sentence. It is not to be overlooked that a jury had found Green guilty of armed rape, armed robbery, and burglary, and the judge had authority to impose three indeterminate sentences up to life imprisonment, concurrently or consecutively. See D.C. Code §§ 22-3202 (additional penalty for committing crime when armed), 22-2801 (rape). The rules governing federal habeas proceedings provide for habeas motions to be referred to the trial judge precisely because that judge "is familiar with the facts and circumstances surrounding the trial, and is consequently not likely to be misled by false allegations as to what occurred." 28 U.S.C. § 2255 Rule 4, Advisory Committee Note (quoting Carvell v. United States, 173 F.2d 348, 348-49 (4th Cir. 1949). Cf. Farrow v. United States, 580 F.2d 1339 (9th Cir. 1978) (en banc) (practice of all other circuits to deny section 2255 motion challenging sentence possibly influenced by invalid prior conviction(s) if district court determines that, treating prior convictions as void, sentence is still appropriate). The court's explanation of the disposition of the motion precludes a finding of likely prejudice.11
38
It is at best pure speculation that more eloquent pleading would have resulted in a lower sentence. In any case, such conjecture does not rise to the level of a showing of likely prejudice. The trial judge has looked at the allegations, taken them seriously enough to write a memorandum opinion stating that a hearing would be futile. If we were to insist on such a hearing we would be saying that a trial judge who imposes a sentence well within statutory bounds for major felonies, after a full-scale trial and upon a presentence report in which no material error has been found, must hold a hearing on a claim raised for the first time 111/2 years later that better allocution might have reduced the sentence.12
39
In the end, the totality of circumstances does not leave us with the impression that an injustice has been suffered. Hence, we affirm.
BAZELON, Senior Circuit Judge, dissenting:
40
Sentencing is the most important part of the typical criminal trial. Effective legal representation at sentencing is critical to meeting society's urgent interest in reaching determinations that accurately and fairly build upon the past and honestly attempt to create hope for the future. The majority opinion in this case holds that James K. Green is not even entitled to an evidentiary hearing on his claim of ineffective assistance of counsel at sentencing, because, according to the majority, Green "has made no showing of 'likelihood of effect on the outcome.' "1 In the course of reaching that conclusion, however, the majority (1) dismisses in a single unconvincing footnote that part of Green's Sixth Amendment claim that concededly does not depend on a showing of "likelihood of effect on the outcome"; (2) so construes the "likelihood of effect" test as to that part of the claim for which it is appropriate so as to virtually gut any attempt to insure the competence of counsel during the sentencing phase of criminal proceedings; (3) conjures out of the district court opinion a crucial finding that the district court never in fact made; and (4) mistakenly dismisses the claim that the sentencing judge should have inquired at the sentencing hearing into the possibility that Green was being denied his Sixth Amendment rights. Because I believe that the "motion and the files and records of the case" do not "conclusively show" that Green is entitled to no relief,2 I respectfully dissent.3
41
The first part of this opinion discusses my serious concern that the relationship between James Green and his counsel was probably so fundamentally flawed by the time of his sentencing hearing as to have left him effectively unrepresented-or worse-at the hearing. Specifically, it examines the evidence already in the record pointing to the existence of conflicts of interest and disabling irreconcilable differences between Green and his counsel, and explains why Green is entitled to an evidentiary hearing on both these related issues. It also demonstrates why neither of these defects would require an independent showing of prejudice in order to constitute a violation of the Sixth Amendment.
42
The next part of the opinion examines the district court judge's duty at the time of sentencing. It explains why, even if the defects in the relationship between Green and his counsel were not as serious as I suspect them to be, we should remand for an evidentiary hearing to determine whether the possibility of a constitutional deprivation should have been evident enough at the time of sentencing that the sentencing judge's failure to make a thorough inquiry at that time was itself a violation of the Sixth Amendment.
43
Finally, the opinion turns to the issue upon which the majority opinion most clearly focuses-the claim of incompetence of counsel-and discusses why, contrary to the majority's analysis, Green has made a sufficient showing under both prongs of the test articulated in United States v. Decoster, 624 F.2d 196 (D.C.Cir.) (plurality opinion), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979), to warrant an evidentiary hearing. That section of the opinion concludes with some general observations about the implications of the majority's position for this court's oversight of the critically important process of criminal sentencing.
I. THE ATTORNEY-CLIENT RELATIONSHIP
44
Whatever other standards the Sixth Amendment may impose on the conduct of counsel in criminal cases, "(t)he first essential element of effective assistance of counsel is counsel able and willing to advocate fearlessly and effectively." United States v. Hurt, 543 F.2d 162, 167-68 (D.C.Cir.1976). "Complete fidelity of a lawyer to his client is an essential element of the existence of the (lawyer-client) relationship." United States v. Decoster, 624 F.2d 196, 236 n.51 (D.C.Cir.) (MacKinnon, J., concurring), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979) (Decoster III ). Such "complete fidelity" is clearly lacking when there is a conflict of interest between lawyer and client. See United States v. Barnes, 662 F.2d 777, 781-82 (D.C.Cir.1980); United States v. Hurt, supra.4 It is also absent when there are such irreconcilable differences between lawyer and client that the lawyer ceases, in practical terms, to serve as an effective advocate for his or her client. See United States v. Daniels, 558 F.2d 122, 127-28 (2d Cir. 1977); United States v. Burkley, 511 F.2d 47, 50-51 (4th Cir. 1975); cf. Anders v. California, 386 U.S. 738, 744, 87 S. Ct. 1396, 1400, 18 L. Ed. 2d 493 (1967).
45
The requirement that an attorney show "complete fidelity" to his or her client is distinct from the requirement that the attorney demonstrate some given level of competence.5 The most salient operational difference between claims based on the two requirements relates to the issue of prejudice. Almost three years ago, in Decoster III, supra, this court imposed on defendants making a constitutional claim based on the incompetence of counsel "the initial burden of demonstrating a likelihood that counsel's inadequacy affected the outcome" of the proceeding.6 We have imposed no such requirement, however, on defendants making a claim grounded on a basic defect in the relationship between lawyer and client. Indeed, with regard to conflicts of interest, both this court and the Supreme Court have, since Decoster III, reaffirmed the long-standing rule that a showing of prejudice is unnecessary.7 I will attempt to demonstrate below why the same rule applies with regard to disabling irreconcilable differences, but it is clear, at the very least, that the question cannot be resolved by simple reference to the holding of Decoster III.
46
In this case, I believe that the record before us strongly suggests both a conflict of interest and disabling irreconcilable differences between Green and his counsel. Because no further showing of prejudice would be necessary to make out a successful Sixth Amendment claim on either of these grounds, I would remand these claims for an evidentiary hearing.
A. Conflict of Interest
47
By the time of James Green's sentencing hearing, he was seriously displeased with the performance of his counsel, and had indeed "repudiated" counsel.8 In fact, Green told his probation officer that "he felt his lawyer was incompetent and that, perhaps there was a conspiracy between his lawyer and the Assistant U. S. Attorney."9 Of course, a client's unhappiness with his lawyer does not in and of itself give rise to a violation of the Sixth Amendment.10 In Green's case, however, that displeasure led to more than the usual reaction on the part of counsel, and that reaction gives every sign of having created precisely the sort of "actual conflict of interest adversely affect(ing) his lawyer's performance" which is in and of itself a violation of the Sixth Amendment. Cuyler v. Sullivan, 446 U.S. 335, 348, 100 S. Ct. 1708, 1718, 64 L. Ed. 2d 333 (1980);11 see United States v. Barnes, 662 F.2d 777, 781-82 (D.C.Cir.1980); United States v. Hurt, 543 F.2d 162 (D.C.Cir.1976).
48
Green alleges that his counsel did not discuss his presentence report with him, or disclose its contents.12 His explanation for this alleged failure is that counsel was concerned about the presentence report's account of Green's dissatisfaction with counsel.13 Neither the claim nor Green's explanation is inconcrete, conclusory, or incredible,14 and only an evidentiary hearing can determine what actually happened and why. But if Green's allegations are well-founded, then it seems clear to me that counsel's "concern for (her)self"-rather than mere negligence, indifference, or bad judgment-led counsel to take a course of action contrary to that called for by her "duty to (her) client."15
49
Even if Green's counsel did show him the presentencing report, the contents of that report create a further reason to infer the existence of an actual conflict of interest. The report's "Evaluative Summary" included a statement that, "(i)n our view, (Green) rather clearly projected responsibility onto others, particularly the police, the Assistant U. S. Attorney, and even his own lawyer."16 An effective presentation at Green's sentencing hearing could easily have included an argument that Green in fact had a more mature personality than he was given credit for in the presentence report. In support of that argument, Green's advocate could easily have been required to argue that some or all of Green's complaints about his trial counsel were in fact supportable, and not merely the product of a tendency to project responsibility. Because our cases make very clear that it is unreasonable to "expect an attorney to vigorously attack his own prior representation of a client," United States v. Barnes, supra, at 782, I would remand for an evidentiary hearing to determine whether the contents of the presentencing report did in fact create an actual conflict of interest between Green and his counsel.
50
Finally, even if we ignore any of the problems created by the presentencing report, the transcript of the sentencing hearing creates a clear inference that an actual conflict of interest adversely affected counsel's performance. At the very start of Green's sentencing hearing, his counsel announced that "I am almost in a position where I feel I need counsel."17 Counsel then went on to devote half of an already abbreviated allocution to a self-serving defense of counsel's conduct at trial, saying that "I am sure the Court remembers the trial for we went through it for several days and in at least this counsel's opinion tried as best we could to give him full and fair representation."18 Whether in response to the allegations Green made to his probation officer, or in response to counsel's own report of Green's "repudiation," or in anticipation of charges Green could have made at the sentencing hearing or did make in a subsequent pro se motion for new trial,19 it seems that counsel felt the need to make clear that Green had no legitimate grounds for complaint. Such an attempt to retain the general confidence of the trial court judge and the rest of the community, even at the expense of the client being immediately represented, would have been entirely natural. But it would also have been contrary to Green's constitutional right to "the services of an attorney devoted solely to the interests of his client," Von Moltke v. Gillies, 332 U.S. 708, 725, 68 S. Ct. 316, 324, 92 L. Ed. 309 (1948), quoted in United States v. Hurt, supra, at 165-66.
51
In light of all of the above, I am convinced that the record demonstrates the strong possibility that the self-serving instincts of Green's counsel "adversely affected ... counsel's performance."20 I would therefore remand for an evidentiary hearing in which the precise facts and their precise consequences can be more conclusively determined.
B. Disabling Irreconcilable Differences
1. Basis of the Claim
52
The Constitution requires that counsel in a criminal case act "in the role of an active advocate in behalf of his client, (rather than) that of amicus curiae." Anders v. California, 386 U.S. 738, 744, 87 S. Ct. 1396, 1400, 18 L. Ed. 2d 493 (1967), cited in United States v. Hurt, 543 F.2d 162, 168 n.31 (D.C.Cir.1976). In this case, the record strongly suggests the possibility that the rift between Green and his counsel not only triggered a conflict of interest between them, but also more generally rendered counsel unable or unwilling to give Green the zealous advocacy and "complete fidelity" to which he was entitled. Cf. Brown v. Craven, 424 F.2d 1166, 1169-70 (9th Cir. 1970). Indeed, it strongly appears that Green was, in practical terms, left unrepresented at his sentencing hearing. See United States v. Daniels, 558 F.2d 122, 127 (2d Cir. 1977); United States v. Burkley, 511 F.2d 47, 51 (4th Cir. 1975).
53
As I have previously discussed, Green's counsel began the sentencing hearing with the comment that she almost felt as if she needed counsel. She then proceeded to inform the district court that "this defendant, I think I should say for the record, has totally repudiated this humble counsel."21 The most charitable reading I can give this otherwise gratuitous and counterproductive remark is that counsel was attempting, if awkwardly, to inform the court, "for the record," that the rift between Green and counsel made it impossible for counsel to provide Green with effective representation. This message becomes much more explicit in counsel's next words: "I say this defendant has totally repudiated this humble counsel and so all I can say is that this is a young man. He is in military service. I think there must be within him seeds for rehabilitation."22 The language I have italicized strongly suggests that counsel recognized that an adequate allocution would have required more than a few half-hearted and ambiguous comments on Green's behalf, but felt unable or unwilling, because of the rift that had developed between them, to go beyond those words. The exact nature of the causal relationship may not be certain: perhaps a failure of communication between lawyer and client, or perhaps sheer exasperation or distraction on counsel's part. But, in light of counsel's clear statement of her inability to represent Green adequately, as confirmed by the actual content of her allocution, it is an open question to me whether the mere presence of counsel at Green's sentencing hearing provided him, in any meaningful sense, with the level of active representation guaranteed by the Sixth Amendment. See Anders v. California, supra; United States v. Daniels, supra; Brown v. Craven, supra.
2. The Prejudice Standard
54
The one serious issue remaining as to this part of Green's claim is whether he must also show some form of prejudice in order to prevail. I believe, however, that the same considerations that have led courts not to apply a prejudice test in cases of conflict of interest also require us to reject such a test in the context of disabling irreconcilable differences.
55
I should note at the outset that, if one were to rely entirely on the majority opinion, it would not be at all clear why even conflict of interest claims do not require a showing of prejudice. The majority suggests that the main consideration prompting the imposition in United States v. Decoster, 624 F.2d 196 (D.C.Cir.) (plurality opinion), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979) (Decoster III), of a "likely prejudice" standard on claims of ineffective assistance based on attorney incompetence was the absence in such cases of the sort of explicit government action found in, for example, outright government interference in the ability of counsel to represent his or her client.23 If the precise role of the official agencies of government were the only touchstone in deciding whether or not to impose a prejudice test, however, far too much would be swept away along with claims of incompetence. The very illustrations used in Decoster III indicate that this was not the court's intention.24 Although I dissented in Decoster III, I would certainly give the plurality opinion in that case more credit than the majority's construction would suggest. Moreover, to the extent that Decoster III did rely on the "state action" rationale to explain the imposition of different prejudice standards for different types of Sixth Amendment claims, that reasoning has been seriously undercut by Cuyler v. Sullivan, 446 U.S. 335, 348-50, 100 S. Ct. 1708, 1718-19, 64 L. Ed. 2d 333 (1980), in which the Supreme Court explicitly defined a class of Sixth Amendment cases in which (1) there is no government involvement of the sort contemplated by Decoster III, but in which (2) a resulting conviction should be overturned without a showing of prejudice.
56
In fact, a sensitive reading of Decoster III suggests a number of criteria, besides the degree of explicit state involvement, that must be applied in determining whether a prejudice test is appropriate in a particular Sixth Amendment context. One of these is whether the particular problem being addressed is "susceptible to easy correction by prophylactic rules."25 Disabling irreconcilable differences, like conflicts of interest, can be fairly objectively identified by participants in the trial process. In particular, although it may be difficult to expect defense counsel to doubt his or her own competence, it is neither unreasonable nor unrealistic to expect defense counsel to identify situations in which they become unable to give their client zealous and single-minded representation.26 Imposing a prophylactic rule at the review stage is therefore, in both cases, workable and salutory.
57
A second criterion identified in Decoster III is the need to find a legal standard that pragmatically "achieves a realistic solution of the pertinent legal tensions."27 One of those tensions arises out of the disruptive effects that too strict a standard in incompetence inquires would have on the criminal justice system.28 I continue to believe that such disruption may be a lesser price to pay than continuing to tolerate a system that provides grossly unequal justice to those unable to afford competent counsel.29 But, be that as it may, neither conflicts of interest nor irreconcilable differences so pervade relationships between criminal defendants and their counsel that we need fear that an effective and stern check on those problems would lead to "noxious consequences."30
58
The second "pertinent legal tension" that concerned the Decoster III plurality was the view that too probing an inquiry into attorney incompetence would intrude excessively into the lawyer-client relationship and ultimately threaten the adversary model of justice to which we are committed.31 Clearly, this same concern cannot be relevant when what is at stake are not particular judgments made by defense counsel during the course of representing a client, but a breach in the attorney-client relationship itself. Indeed, rigorous enforcement of the Sixth Amendment guarantee against representation by a lawyer with whom one has either a conflict of interest or a disabling irreconcilable difference can do nothing but strengthen the adversary system of justice.
59
A final consideration, only implicit in the Decoster III plurality opinion, but emphasized in the concurrence by Judge MacKinnon,32 and of prime importance in other cases concerning the issue of whether or not to impose a prejudice requirement33 is the balance, in any particular category of Sixth Amendment protections, between the overall likelihood of prejudice and the difficulty of proving prejudice in a particular case. With regard to conflicts of interest, the Supreme Court said in Holloway v. Arkansas, 435 U.S. 475, 490-91, 98 S. Ct. 1173, 1181-82, 55 L. Ed. 2d 426 (1978), that the evil "is in what the advocate finds himself compelled to refrain from doing" rather than in any particular affirmative act and that an inquiry into prejudice would therefore require "unguided speculation." Clearly, precisely the same problem applies with regard to disabling irreconcilable differences.
60
Taking into account all these considerations, I conclude that Green's claim that the rift between him and his lawyer deprived him of a zealous and active advocate does not require any additional showing of prejudice. Therefore, we need not look beyond the content of counsel's remarks at the sentencing hearing to remand for an evidentiary hearing before the district court.
C. The Majority's Position
61
The majority advances two main arguments against my analysis of the conflict of interest and disabling irreconcilable difference issues in this case. First, it suggests that I have defined one or both of these concepts too broadly. Second, it claims that I have advanced no causal link between the nature of Green's relationship with his counsel and the performance of counsel.
62
With regard to the first point, I believe that my analysis of both the conflict of interest and disabling irreconcilable differences issues goes no further than is required by the common sense meaning of the constitutional requirement that counsel be "able and willing to advocate fearlessly and effectively," with "complete fidelity" to the interests of his or her client.34 Moreover, the majority's attempt to restrict the scope of this vital constitutional guarantee is clearly refuted by the very case-law cited by the majority. In United States v. Hurt, 543 F.2d 162 (D.C.Cir.1976), for example, the attorney who represented Hurt during an evidentiary hearing examining ineffective assistance by defendant's original trial counsel found himself sued for libel by the lawyer whose performance he was challenging. The court found that, although the doctrine of absolute immunity gave counsel at the evidentiary hearing "little or nothing to fear from continued representation of appellant on the evidentiary inquiry into the quality of the service which trial counsel had rendered," id. at 167, counsel's exaggerated and almost entirely subjective concern about the consequences of the suit created a conflict of interest between him and his client.
63
United States v. Barnes, 662 F.2d 777 (D.C.Cir.1980), is perhaps even more directly on point. As relevant here, that case involved the representation of a defendant in a 2255 hearing by his original appellate counsel. Among a number of questions possibly at issue in the hearing was whether the defendant's substantive claim was barred by his failure to raise it on the original appeal. Counsel at the 2255 hearing both neglected to discuss that issue and was generally defensive about his prior representation of the defendant. This court easily perceived a conflict of interest. I find it difficult to understand how, in light of both Barnes and Hurt, the majority here can argue that the record conclusively demonstrates that there was no conflict of interest between Green and his counsel.
64
The majority also writes that my analysis does no more than "restat(e) counsel's alleged deficiencies and (then) by fiat ascrib(e) Green's expressed unhappiness with counsel as their cause."35 I must of course, respectfully disagree. If Green is telling the truth when he alleges that counsel did not show him the presentence report-something the majority concedes cannot be decided by this court on this record-then the possibility that the failure was caused by the report's account of Green's dissatisfaction is concrete and plausible. Similarly, I see nothing far-fetched about the possibility that counsel's self-serving comments at the sentencing hearing were the product of defensiveness rather than some more mysterious cause. And we need look no further than counsel's own words at the sentencing hearing-"this defendant has totally repudiated this humble counsel and so all I can say is that ..." etc.36-in order to conclude that her abbreviated allocution was probably due to her irreconcilable differences with Green. I do not pretend that we can know all these things with certainty. But it is precisely the purpose of an evidentiary hearing to sort out all the facts and reach a more definite conclusion. Because I see nothing in this record that conclusively demonstrates that Green's claim is without merit, I believe he is entitled to that opportunity.37
II. THE DUTY OF THE SENTENCING JUDGE
65
Aside from requiring that counsel show "complete fidelity" to their clients, the Sixth Amendment also imposes a separate qualified duty on trial judges to guarantee that such complete fidelity does in fact exist.38 The majority holds that "(t)he absence of a cognizable conflict also disposes of appellant's contention that the sentencing judge ought to have inquired into the nature of the 'problem' between Green and his counsel."39 This holding assumes that whether or not there was any duty on the part of the sentencing judge follows automatically from whether or not the performance of counsel, in and of itself, led to a constitutional deprivation. As the Supreme Court made clear in Cuyler v. Sullivan, 446 U.S. 335, 100 S. Ct. 1708, 64 L. Ed. 2d 333 (1980), however, the two issues are governed by entirely different standards. In the absence of a duty of inquiry, a violation of the Sixth Amendment will not be found unless there was an actual conflict of interest. Id. at 348, 100 S.Ct. at 1718. The duty of inquiry, on the other hand, is triggered by the combination of (1) a possible conflict of interest, and (2) either "timely objection" or "special circumstances" sufficient to reverse the normal presumption that either no conflict in fact exists or the lawyers and clients involved knowingly accept such risk of conflict as may exist. Id. at 346-48, 100 S.Ct. at 1717-18.40
66
The majority must concede that there was at least a possible conflict of interest in this case. Whether or not counsel's statements at Green's sentencing hearing-such as "I am almost in a position where I feel I need counsel" and "this defendant has totally repudiated this humble counsel"-constituted a "timely objection," they almost certainly created the "special circumstances" that should have led the sentencing judge to insure that Green was receiving adequate representation. Indeed, the Court relied on far more tenuous grounds to impose a duty of inquiry under the Cuyler standard in the subsequent case of Wood v. Georgia, 450 U.S. 261, 101 S. Ct. 1097, 67 L. Ed. 2d 220 (1981). Moreover, this case, unlike Cuyler and Wood, involves a conflict of interest between lawyer and client rather than counsel's conflicting loyalties to various clients or employers. Consequently, even the presumption invoked in Cuyler that possible conflict will, absent some signal to the contrary, be outweighed by possible benefits, may not apply. In any case, it seems clear to me that even if my analysis in Part I of this dissent is mistaken, the judge presiding at Green's sentencing hearing probably had an affirmative duty to inquire into the import of the words spoken by counsel, and to take whatever steps would have been necessary to protect Green's rights under the Sixth Amendment.41
67
In light of the sentencing judge's almost certain duty of inquiry, it is particularly disturbing that she not only failed to undertake an affirmative inquiry, but may have stifled whatever further opportunity there was for the issue to surface during the course of the hearing. At the conclusion of counsel's unhelpful and self-serving allocution, counsel "ask(ed) the Court to hear (Green) say anything he desires to say,"42 at which point the following exchange took place between Green and the sentencing judge:
68
THE COURT: Mr. Green.
69
THE DEFENDANT: Your Honor, I would like to ask the Court a couple of questions, if I may.
70
THE COURT: You just tell us what you have to say. The Court isn't interrogated.
THE DEFENDANT: I have nothing to say.43
71
Whether or not such a response by the sentencing judge would, in the course of a normal sentencing hearing, represent a denial of the defendant's right to speak,44 it may have, in this case, extinguished what hope there was of a complete inquiry into Green's relationship with his counsel, and the effect of that relationship on Green's rights under the Sixth Amendment.
III. THE COMPETENCE OF COUNSEL
72
Even if the majority were correct that the only Sixth Amendment issue worth exploring in this appeal is the claim that Green was deprived of effective assistance of counsel by virtue of counsel's incompetence, I would still have to dissent from its conclusion that Green is not entitled to an evidentiary hearing on his claim.
73
A. "Serious Incompetency"
74
United States v. Decoster, 624 F.2d 196, 208 (D.C.Cir.) (plurality opinion), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979) (Decoster III ), requires that, in any claim of ineffective assistance of counsel grounded on the alleged incompetence of counsel, "(t)he claimed inadequacy must be a serious incompetency that falls measurably below the performance ordinarily expected of fallible lawyers." As this court subsequently explained,
75
this standard does not require "errorless representation," (but) it does demand that counsel's choices be "the product of deliberate and informed decision, not oversight or inadvertance." Where counsel's choices are uninformed because of inadequate preparation, or are not "arguably ... the product of tactical decisions," a defendant has been denied his right to the effective assistance of counsel guaranteed by the Constitution.
76
United States v. Hinton, 631 F.2d 769, 780 (D.C.Cir.1980) (footnotes omitted). The majority explicitly declines to reach this part of the Decoster III test, focusing instead on the additional requirement in Decoster III that the accused bear the initial burden of "demonstrating a likelihood that counsel's inadequacy affected the outcome" of the proceeding.45 I am convinced, however, that if the majority had reached the first prong of the Decoster III test, neither it-nor any honest observer-could have concluded that the record so far assembled in this case conclusively demonstrates that Green's counsel met the standard of competence demanded by the Constitution.
77
First, it is clear to me that, if we take as true Green's allegation that his counsel did not disclose the presentence report to him or disclose its contents, that failure by counsel would clearly constitute serious incompetence. United States v. Donn, 661 F.2d 820, 824 (9th Cir. 1981). "(A) defense attorney develops his case in large part from information supplied by his client." Decoster III, supra, at 209. Discussing the presentence report with Green would have been the best way for counsel to alert herself to inaccuracies or omissions in the report. A whole range of further decisions, including what investigations were appropriate and what arguments would have been viable at the hearing, would have depended on a thorough dialogue between lawyer and client. See United States v. Pinkney, 551 F.2d 1241, 1250-51 (D.C.Cir.1976). Failure to confer with a client, and to attempt to obtain as much first-hand information from the client as possible, is not a "quick judgment,"46 or a "tactical decision,"47 which a court should be loath to second-guess, but is rather precisely the sort of egregious violation of a clear responsibility to which Hinton was addressed.
78
The second disturbing element in the record is counsel's failure, according to her own affidavit, to make an independent effort to verify the presentence report or fill in its gaps, even after Green allegedly expressed his objections to it.48 Competent counsel is generally expected to verify the information contained in the presentence report, see United States v. Pinkney, supra, at 1250, supplement the report when incomplete, and challenge it when inaccurate, see id.; United States ex rel. Jackson v. Myers, 374 F.2d 707, 710 (3d Cir. 1967). I strongly doubt that Green's counsel's failure to meet these duties can be rationalized, even under Decoster III 's non-"categorical" approach, 624 F.2d at 208 (plurality opinion), as a result of reasonable tactical choices or acceptable allocations of resources.
79
Finally, counsel's behavior at the sentencing hearing speaks for itself. Counsel's allocution was perfunctory at best, and very possibly counterproductive. Even if counsel's self-serving comments about the rift with Green and about counsel's own performance at trial are not evidence that counsel lacked "complete fidelity" to Green's cause,49 they seem to display a serious lack of care and competence.
B. Likely Prejudice
80
As I have already suggested, the majority bases its rejection of Green's claim of incompetent assistance of counsel on a finding that Green has not made an adequate showing of likely effect on the outcome of the sentencing hearing. This finding seems primarily grounded on the majority's reading of the district court opinion-a reading that I find entirely mistaken. The majority also states that "Green has identified no additional facts that might have been raised by counsel to sway the (sentencing) judge toward leniency."50 I believe that this additional ground is not only equally mistaken, but also shows a disturbing lack of appreciation for the nature of the sentencing process.
1. Reliance on the District Court Opinion
81
As the majority concedes, the district court never reached the second prong of the Decoster III test in discussing Green's Sixth Amendment claim.51 Rather, the district court judge, who had also been the original sentencing judge, rested on the first prong, stating that "(t)his Court specifically remembers the competence and skill of the trial attorney at all stages of the case, including the sentencing."52 Instead of remanding to the district court on the issue of likely prejudice,53 however, the majority engages in an awkward exegesis in order to reach the conclusion that the district court "effectively ruled out the possibility of prejudice emanating from the alleged deficiencies in counsel's performance."54
82
In reaching its conclusion, the majority looks to the section of the district court opinion which dealt with Green's claim that his Fifth Amendment rights had been violated by the presence of errors in his presentence report. In that part of its opinion, the district court held that "(t)he alleged errors pointed to in the presentence report ... were not material to the Court's determination of sentence."55 In explaining this holding, the district court went on to state that she had "relied primarily on the facts of the crime and the trial testimony in making (her) sentencing decision."56 This finding by the district court was both proper and plausible, and I concur in the majority's rejection of Green's Fifth Amendment claim.57 But the majority takes the district court's statement out of context when it holds that the statement "precludes a finding of likely prejudice" with regard to Green's claim of ineffective assistance of counsel.58 It is one thing to say that, given the materials before the district court at the time of sentencing, all of which it considered, it found the most compelling factor in determining the sentence to be the facts of the crime and the trial testimony. It is an entirely different matter, both in logic and experience, to say that, if additional information, insights, and arguments had been presented to the sentencing court, it could not have been moved to impose a different sentence. To infer one conclusion from the other is just plain wrong.
83
I find it difficult even to rationalize the majority's conclusion as a corner-cutting but plausible inference from the overall tone of the district court opinion. First, a more committed and informative allocution by counsel, based on adequate consultation with Green and proper independent investigation, might have led the sentencing judge to impose a different sentence even if it did not move the judge not to "rel(y) primarily on the facts of the crime and the trial testimony." Second, there is no indication that the district court confronted the possibility that Green's counsel could have, aside from correcting the errors in the presentence report, also given a significantly expanded and persuasive allocution.59 For the majority to feel the need to reach out as it does is particularly difficult to understand when it has the option of remanding the case and letting the district court speak for itself.
84
There is a serious additional problem with the majority's reliance on the district court's opinion. The district court's analysis of whether or not the errors in the presentence report tainted the sentencing decision seems to have been based on something very much like an "actual prejudice" test. Even if there were more of a factual link, therefore, between the effects of the errors in the presentence report and the effects of the incompetency of Green's counsel, the district court's opinion could not assure us that the latter did not constitute sufficient "likely prejudice" to meet the second prong of the Decoster III test.60
85
The plurality opinion in Decoster III clearly saw an important distinction between likely prejudice and actual prejudice. In explaining why the "likely prejudice" test was an "appropriate modification"61 of the more stringent standard articulated in Bruce v. United States, 379 F.2d 113, 117 (D.C.Cir.1967), Judge Leventhal commented that "(o)verreaching concepts of justice tug on the court whenever it is seriously troubled by likelihood of injustice, even though there is no concrete establishment of injustice as a fact."62 For this court to rely on the district court's finding of no actual prejudice to find that there was no likely prejudice is a betrayal of Decoster III 's explicit attempt to fashion a suitable compromise position that would "achieve( ) a realistic resolution of the pertinent legal tensions."63 As I will explain in some more detail below, this erosion of Decoster III is most regrettable because it occurs in the context of attorney incompetence during sentencing.
86
2. "Additional Facts"
87
The majority opinion also states that "Green had identified no additional facts that might have been raised to sway the judge toward leniency."64 On the contrary, Green raises a whole series of material facts that might have influenced the sentencing judge. For example, Green's counsel could have emphasized Green's stable employment history, which was left at best ambiguous in the presentence report. Counsel could have presented to the judge evaluations by Green's former employers that could have influenced the district court in its assessment of whether Green had the potential to make a valuable contribution to society. Counsel could have discussed Green's active ambition to be a music promoter. Counsel could have given the sentencing judge a more complete account of Green's family background than was contained in the presentence report. At the minimum, counsel could have avoided devoting half of her allocution to a series of self-serving pronouncements. None of these possibilities constitutes a "smoking pistol." But the facts relevant to sentencing are almost never in the form of smoking pistols. Rather, sentencing is a highly discretionary process influenced by a wide range of considerations.65 We do know, however, that the role of defense counsel in sentencing can be critically important and influential.66 We also know that considerations like employment and family history do often play a significant role in the sentencing decision.67 Perhaps more important, our system of sentencing is based in large part on the premise that such considerations play a legitimate and desirable part in the sentencing calculus.68 For the majority to say that "Green has identified no additional facts that might have been raised to sway the judge toward leniency" ignores both reality and aspiration. The only way to determine whether a more complete and effective allocution would have made a difference in this case is to remand for explicit and complete factfinding by the district court.
88
3. The "Likely Prejudice" Test Applied to Sentencing
89
The majority opinion raises a more general concern about the application of the second prong of Decoster III to sentencing. The Decoster III test was conceived with the trial context most clearly in mind.69 To be faithful to the intent of Decoster III therefore requires that we recognize that "likely prejudice" is a much more slippery notion when applied to the outcome of a sentencing hearing than when applied to the outcome of a trial. In the first place, as I suggest above, sentencing is a highly individuated determination, and there is no easy formula for determining the effect of any particular fact or insight on the outcome. Second, the determination of a sentence entails consideration of a wide range of highly graduated alternatives, as opposed to the essentially bipolar decisionmaking engaged in at trial: "Likely prejudice" in the outcome of a trial requires a significant enough change in the original factfinding balance to result in a likely tipping of the factfinding balance. In the sentencing context, by contrast, there is no "balance" to be tipped, and any material factor could have some effect, large or small, on where along a range of possible results the decisionmaker will alight.
90
Together, these two differences between the trial and sentencing context make likely prejudice in the latter case both more likely to occur and also much more difficult to pin down. The majority opinion, however, ignores this dilemma. Rather than requiring a searching examination and thorough discussion by the district court, it denies Green's claim on the basis of a factually and legally unrelated finding in the district court's memorandum. And rather than attempting to be sensitive to the subtleties of the sentencing calculus, it adopts a mechanistic view of sentencing that challenges the defendant to find that one special fact that would push a lever marked "leniency" in the sentencing judge's mind.70
91
What most disturbs me about the majority opinion is that, while it purports to follow Decoster III, it may, as a practical matter, deprive defendants of the level of protection against incompetent counsel at sentencing that Decoster III attempted to afford them during trial. Such a result would be particularly unfortunate because sentencing is the one area in which judicial scrutiny may be most necessary. It has often been said that sentencing is the most important stage in a criminal proceeding.71 It is not only important for the individual defendant, but is the one part of the process of criminal adjudication that attempts to do some affirmative good, rather than merely react to past events.72 At the same time, sentencing is the phase of the criminal process that defense counsel are most likely to shirk, under the entirely mistaken view that their active role in representing their clients ends with a verdict or plea of guilty.73 The majority opinion will do precious little to alert attorneys to the importance of their role at sentencing. It may, in fact, demote allocution to a superfluity and signal the abandonment of any serious effort to ensure that sentencing be more than a meaningless charade unworthy of our aspirations and contrary to the practical needs of the criminal justice system.
1
United States v. Green, 436 F.2d 290 (D.C.Cir.1970) (per Bazelon, C.J.) upheld his conviction for first degree burglary while armed, D.C.Code § 22-1801(a); robbery, § 22-2901; rape while armed, § 22-2801; assault with a dangerous weapon, § 22-502; and carrying a dangerous weapon, § 22-3204
2
Presentence Report at 6
3
Transcript of Sentencing Hearing at 1-2
4
Appellant's Motion to Vacate, Set Aside, or Correct Sentence at pp. 1-3 of attachment
5
Id. at p. "1-B" of attachment
6
Opposition to Motion to Vacate Sentence Pursuant to 28 U.S.C. § 2255 at 2-6
7
Id. at 6-8
8
Rule 7, entitled "Expansion of Record," provides:
(a) Direction for expansion. If the motion is not dismissed summarily, the judge may direct that the record be expanded by the parties by the inclusion of additional materials relevant to the determination of the merits of the motion.
(b) Materials to be added. The expanded record may include, without limitation, letters predating the filing of the motion in the district court, documents, exhibits, and answers under oath, if so directed, to written interrogatories propounded by the judge. Affidavits may be submitted and considered as a part of the record.
(c) Submission to opposing party. In any case in which an expanded record is directed, copies of the letters, documents, exhibits, and affidavits proposed to be included shall be submitted to the party against whom they are to be offered, and he shall be afforded an opportunity to admit or deny their correctness.
(d) Authentication. The court may require the authentication of any material under subdivision (b) or (c).
9
It is quite possible that in anticipation of a parole hearing in 1981, he was allowed access to the report. The Parole Act requires the Parole Commission to provide to a requesting prisoner in advance of any parole determination "reasonable access to a report or other document to be used by the Commission in making its determination." 18 U.S.C. § 4208(b)(2)
10
The defendant had already testified at trial at which time his past employment and family situation were discussed at some length. See Trial Transcript at 442, 466-67
11
The dissent attempts to draw formalistic distinctions to challenge the relevance of the trial court's statements regarding the basis of its sentencing decision in establishing lack of prejudice. The district court's explanation that the sentence was based primarily on the facts of the crime came specifically in response to the argument that the inaccurate and incomplete report misled the court. The court had before it the corrections and additions to the report that Green claims ought to have been offered initially. In the face of this, the court reaffirmed the sentence as merited by the defendant's conduct. In this context, such an affirmation by the very judge that imposed the sentence amounts to the same thing as saying that the additional information and argument that Green asserts should have been proffered would not have affected the sentencing decision. True, the district court did not state that a more adequate and helpful performance by counsel could not have had any effect on the sentence. But neither had appellant provided any substantive omissions from either the presentence report or allocution that might realistically have affected the outcome. It is beside the point that some hypothetical, unspecified additional information conceivably "might" have resulted in a different sentence, because the inquiry is whether Green has shown that his sentence likely would have been reduced. Cf. 28 U.S.C. foll. § 2255 Rule 4 (note) ("petition is expected to state facts that point to a 'real possibility of constitutional error' "). The unanchored potentiality of harm cannot justify overriding the justice system's special concerns on collateral attack "such as respect for finality of judgments and conservation of judicial resources." United States v. Decoster, 624 F.2d at 207. Cf. id. ("direct appeal gives more latitude to the court")
12
The dissent attempts to categorize this case as one of conflict of interest where no prejudice need be shown. As Judge Bazelon has previously observed, prejudice is presumed from lack of loyalty, but appellant "must first demonstrate that there has been a breach of loyalty in order for that presumption to be operative." United States v. McCord, 509 F.2d 334, 353 n.69 (D.C.Cir.1974), cert. denied, 421 U.S. 930, 95 S. Ct. 1656, 44 L. Ed. 2d 87 (1975) (denying hearing on habeas claim that counsel did not fully represent client's interests). In Cuyler v. Sullivan, 446 U.S. 335, 349, 100 S. Ct. 1708, 1718, 64 L. Ed. 2d 333 (1980) (denying habeas corpus on claim of potential conflict of interest where attorneys represented multiple defendants), the Supreme Court cautioned: "until a defendant shows that his counsel actively represented conflicting interests, he has not established the constitutional predicate for his claim of ineffective assistance." 446 U.S. at 350, 100 S.Ct. at 1719. If all rifts of the type that develop between disappointed defendants and their trial attorneys were to be characterized as conflicts of interest or "disabling irreconcilable differences," rarely could trial attorneys represent their clients at sentencing. Not only is such a broad definition of disabling circumstances inconsistent with an attorney's obligation to continue representation absent "compelling" considerations, Model Code of Professional Responsibility EC 2-32 (1979), but this court has defined conflicts which corrupt the attorney-client relationship more narrowly, i.e., instances "when counsel's duty to his client calls for a course of action which concern for himself suggests that he avoid." United States v. Hurt, 543 F.2d 162, 166 (D.C.Cir.1976) (appellate counsel's unreasonable but genuine subjective fear of libel suit rendered him unable to press claim of ineffective assistance of trial counsel). See United States v. Barnes, 662 F.2d 777 (D.C.Cir.1980) (conflict present when attorney whose performance on appeal was at issue called upon by court to represent client at section 2255 hearing)
The dissent attempts to gut the Decoster prejudice requirement by transforming this into a "loyalty" case. It purports to establish an actual conflict of interest by restating counsel's alleged deficiencies and by fiat ascribing Green's expressed unhappiness with counsel as their cause. While "actual" conflict exists where "potential" conflict " 'adversely affect(s) ... counsel's performance,' " Diss.Op. at 194 n.11, the dissent fails to show that "potential" conflict, as opposed to other factors, affected counsel's performance. Even if "potential conflict" is posed by Green's not atypical disappointment at his attorney's inability to exonerate him, we are left adrift as to why we should assume here that counsel's sensitivity to criticism was such as to prompt her to (1) avoid discussion of the report with Green (assuming this is true), (2) fail to supplement the report with favorable information, or (3) abbreviate the presentation at allocution. "Vague" and "conclusory" allegations will not suffice even to raise the issue, let alone establish the existence of a conflict of interest. Blackledge v. Allison, 431 U.S. at 75 & n.7, 97 S. Ct. at 1630 & n.7. See text following note 8 supra. In an attempt to establish a causal connection, the dissent suggests that to defend her client's character, counsel's sentencing presentation should have questioned the adequacy of her representation at trial. The weakness of this suggestion as a basis for establishing a conflict of interest is best demonstrated by the cumulation of speculations and tenuous connections the dissent employs to attempt to make the point. Diss.Op. at 194 (effective presentation at sentencing "could easily have" included argument that Green was more mature than indicated in report; such argument "could easily have" required counsel to recognize validity of Green's complaints about counsel). Similarly, the dissent attributes counsel's brevity at allocution to "irreconcilable differences" even while conceding that "(t)he exact nature of the causal relationship may not be certain." Diss.Op. at 195. In sum, the record is woefully inadequate to show a conflict of interest or irreconcilable differences. We are a long way from a situation where an attorney owes a duty to a client that threatens the attorney's self-interest, e.g., United States v. Barnes, supra, or clashes with a duty owed by the attorney to another, e.g., Wood v. Georgia, 450 U.S. 261, 101 S. Ct. 1097, 67 L. Ed. 2d 220 (1981). The dissent would have us hold that any expression, no matter how vague, of client dissatisfaction combined with allegations of counsel's deficiency, no matter how minimal, is sufficient to make a showing of breach of loyalty. An elementary appreciation of the realities of the criminal process suggests that this approach would eliminate the prejudice requirement in the vast majority of incompetency cases. Although the dissent marshalls "characteristic eloquence" in its "expression of aspirations for the legal system," United States v. Decoster, 624 F.2d at 214 (commenting on Judge Bazelon's dissent), we remain concerned with "tenable standards," id., and will not sub silentio overrule Decoster by formulating an exception that swallows the rule.
The absence of a cognizable conflict also disposes of appellant's contention that the sentencing judge ought to have inquired into the nature of the "problem" between Green and his counsel. Contrary to the arguments advanced by appellant and the dissent, "(u)nless the trial court knows or reasonably should know that a particular conflict exists, the court need not initiate an inquiry." Cuyler v. Sullivan, 446 U.S. at 347, 100 S.Ct. at 1717. As no actual conflict has been shown even yet, the sentencing judge could hardly have had notice of it.
1
Maj. op. at 189
2
See 28 U.S.C. § 2255 (1976)
3
I do concur in Part II of the majority opinion, which affirms the district court's finding that Green is not entitled to an evidentiary hearing on his claim that he was sentenced on the basis of materially false information. I do not take this holding to mean, however, that the sentencing report was a sufficient or complete account of Green's character and background. Nor do I believe that the district court's finding in any way negates the possibility that the sentencing decision would likely have been influenced by countervailing or supplementary information or insights supplied by counsel. See pp. 201-202 infra
4
See also United States v. Hearst, 638 F.2d 1190, 1193 (9th Cir. 1980), cert. denied, 451 U.S. 938, 101 S. Ct. 2018, 68 L. Ed. 2d 325 (1981); United States v. Burkley, 511 F.2d 47, 51 (4th Cir. 1975)
5
See United States v. Barnes, 662 F.2d 777, 782 n.8 (D.C.Cir.1980); United States v. Hearst, 638 F.2d 1190, 1194 (9th Cir. 1980), cert. denied, 451 U.S. 938, 101 S. Ct. 2018, 68 L. Ed. 2d 325 (1981); United States v. Decoster, 624 F.2d 196, 234-37 (D.C.Cir.1979) (MacKinnon, J., concurring), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979)
6
624 F.2d at 208 (plurality opinion). The Decoster III formulation actually referred only to the "outcome of the trial." Id. (emphasis added). I discuss at pp. 204-205 infra, the differences between the trial and sentencing contexts that must be kept in mind in giving content to Decoster III 's likely prejudice requirement
7
See Cuyler v. Sullivan, 446 U.S. 335, 349-50, 100 S. Ct. 1708, 1718-1719, 64 L. Ed. 2d 333 (1980); United States v. Barnes, 662 F.2d 777, 782 n.8 (D.C.Cir.1980)
8
Transcript of Sentencing Hearing at 1, quoted in Maj. op. at 184-185. See Presentencing Report at 3; Affidavit of Trial Counsel at 1-2
9
Presentencing Report at 3
10
But cf. Slappy v. Morris, 649 F.2d 718, 720-21 (9th Cir. 1981); United States v. Barnes, 662 F.2d 777, 781 (D.C.Cir.1980); United States v. Mardian, 546 F.2d 973, 979-81 (D.C.Cir.1976); United States v. Seale, 461 F.2d 345, 356-61 (7th Cir. 1972); Brown v. Craven, 424 F.2d 1166, 1169-70 (9th Cir. 1970) (all discussing parameters of defendant's right to counsel of his choice)
11
Cuyler seems to require both that the conflict of interest between lawyer and client be "actual" rather than "potential," and that it "adversely affect" counsel's performance, but these are in fact not necessarily separate issues: as a number of courts have recognized, any otherwise "potential" conflict that "adversely affect(s) ... counsel's performance" is by definition an "actual conflict." See Brown v. United States, 665 F.2d 271, 272 (9th Cir. 1982); United States v. Hearst, 638 F.2d 1190, 1194 (9th Cir. 1980), cert. denied, 451 U.S. 938, 101 S. Ct. 2018, 68 L. Ed. 2d 325 (1981); Honneus v. United States, 509 F. Supp. 1135, 1138-39 & n.3 (D.Mass.1981)
12
Appellant's Motion at p. "1-B" of Attachment
13
Id
14
See Machibroda v. United States, 368 U.S. 487, 493-96, 82 S. Ct. 510, 513-15, 7 L. Ed. 2d 473 (1962); Walker v. Johnston, 312 U.S. 275, 285, 61 S. Ct. 574, 578, 85 L. Ed. 830 (1941); Friedman v. United States, 588 F.2d 1010, 1014-17 (5th Cir. 1979); Lindhorst v. United States, 585 F.2d 361, 364-66 (8th Cir. 1978); Stidham v. Wingo, 452 F.2d 837, 839-40 (6th Cir. 1971)
15
See United States v. Hurt, 543 F.2d 162, 166 (D.C.Cir.1976); cf. Maj. op. at 190-191 n.12
16
Presentencing Report at 6
17
Transcript of Sentencing Hearing at 1
18
Id
19
The pro se motion was made during the course of Green's original appeal, and after the appointment of appellate counsel. The motion claimed ineffective assistance of counsel in counsel's alleged failure to file certain pretrial motions. It was denied without opinion on May 20, 1969
20
See n.11 supra
21
Transcript of Sentencing Hearing at 1
22
Id. (emphasis added)
23
Maj. op. at 188-189
24
624 F.2d at 201-02 (plurality opinion); cf. id. at 235-36 (MacKinnon, J., concurring)
25
Id. at 201 (plurality opinion)
26
Cf. Anders v. California, 386 U.S. 738, 744-45, 87 S. Ct. 1396, 1400-01, 18 L. Ed. 2d 493 (1967); ABA Code of Professional Responsibility, DR 5-101(A)
27
624 F.2d at 208 (plurality opinion)
28
Id. at 214-17
29
Id. at 295-300 (Bazelon, J., dissenting)
30
See id. at 217 (plurality opinion)
31
Id. at 208-09
32
Id. at 236-37 (MacKinnon, J., concurring)
33
See e.g. Holloway v. Arkansas, 435 U.S. 475, 487-91, 98 S. Ct. 1173, 1180-82, 55 L. Ed. 2d 426 (1978); Cooper v. Fitzharris, 586 F.2d 1325, 1332 (9th Cir. 1978), cert. denied, 440 U.S. 974, 99 S. Ct. 1542, 59 L. Ed. 2d 793 (1979); United States v. Hurt, 543 F.2d 162, 168 (D.C.Cir.1976)
34
See pp. 192-193 supra
35
Maj. op. at 190-191 n.12
36
See p. 187 supra
37
The majority makes much of the fact that the record before the district court was supplemented by an affidavit from Green's original counsel. Maj. op. at 186. By my reading of the affidavit, however, it does not add any information that would reduce the need for an evidentiary hearing. The affidavit does state, contrary to Green's sworn 2255 motion, that counsel showed the presentencing report to Green and discussed it with him. See p. 201 & n.48 infra. But this account does no more than create a direct conflict between two credible and concrete sworn statements, and such a conflict can only be resolved by an evidentiary hearing in which both claims can be subject to thorough cross-examination. See Walker v. Johnston, 312 U.S. 275, 286-87, 61 S. Ct. 574, 579, 85 L. Ed. 830 (1941); Lindhorst v. United States, 585 F.2d 361, 364-65 (8th Cir. 1978); Advisory Committee Note to Rule 7 of the Rules Governing § 2254 Cases (quoting Raines v. United States, 423 F.2d 526, 530 (4th Cir. 1970)). (The Advisory Committee Note to Rule 7 of the Rules Governing § 2255 Proceedings refers to the corresponding § 2254 Advisory Note as the source for "a full discussion of reasons and procedures for expanding the record.") Perhaps more important, counsel's own account of the upshot of her alleged conversations with Green can only add weight to the conclusion that she provided him with ineffective assistance. See p. 201 infra
38
See Holloway v. Arkansas, 435 U.S. 475, 481-87, 98 S. Ct. 1173, 1177-1180, 55 L. Ed. 2d 426 (1978); cf. United States v. Williams, 594 F.2d 1258 (9th Cir. 1979); Brown v. Craven, 424 F.2d 1166, 1170 (9th Cir. 1970)
39
Maj. op. at 190-191 n.12
40
The majority reads Cuyler to impose a duty of inquiry only in cases of actual conflict. Maj. op. at 190-191 n.12. This reading is based on the Supreme Court's comment that "(u)nless the trial court knows or reasonably should know that a particular conflict exists, (it) need not initiate an inquiry." 446 U.S. at 347, 100 S. Ct. at 1717. When considered in context, however, the term "particular conflict" in that sentence seems most likely to refer to a possible conflict brought to the court's attention by objection or special circumstances rather than to an actual conflict. In any case, whatever ambiguity may exist in Cuyler is entirely erased by Wood v. Georgia, 450 U.S. 261, 272, 101 S. Ct. 1097, 1104, 67 L. Ed. 2d 220 (1981), in which the Court found it "difficult ... to determine whether an actual conflict of interest was present," but nevertheless held that "the possibility of a conflict of interest was sufficiently apparent at the time of the revocation hearing (in the court below) to impose upon the court a duty to inquire further" (emphasis in original)
41
My one hesitation arises out of the possibility that, in the context of the relationship between counsel and the sentencing judge, the words counsel spoke had a very different meaning than that which would otherwise be obvious from the record. But this hesitation, at best, requires that we remand for an evidentiary hearing, and would not justify our rejection of Green's claim
42
Transcript of Sentencing Hearing at 1
43
Id. at 2
44
See Green v. United States, 365 U.S. 301, 305, 81 S. Ct. 653, 655, 5 L. Ed. 2d 670 (1961) ("Trial judges before sentencing should, as a matter of good judicial administration, unambiguously address themselves to the defendant. Hereafter trial judges should leave no room for doubt that the defendant has been issued a personal invitation to speak prior to sentencing.")
45
Maj. op. at 188-189. Cf. note 6 supra
46
See United States v. Decoster, 624 F.2d 196, 208 (D.C.Cir.) (plurality opinion), cert. denied, 444 U.S. 944, 100 S. Ct. 302, 62 L. Ed. 2d 311 (1979)
47
United States v. Butler, 504 F.2d 220, 224 (D.C.Cir.1974)
48
See Affidavit of Trial Counsel at 1 (stating that counsel had reviewed the presentence report with Green, and that though Green was unhappy with the report, counsel found it "accurate in all material respects" and "consistent with counsel's impressions of Mr. Green and with the information he had given (counsel) about himself.")
49
See Part II supra
50
Maj. op. at 189-190
51
See id. at 186-187, 189-190
52
Memorandum Opinion at 3
53
See United States v. Hinton, 631 F.2d 769, 783 (D.C.Cir.1980) ("Rather than speculate as to the meaning of the district court's findings, we remand the record for clarification (on the issue of prejudice).")
54
Maj. op. at 189-190 (emphasis added), see also id. at 190 n.11 (district court's holding "amounts to the same thing" as finding of no effect on outcome)
55
Memorandum Opinion at 2
56
Id
57
See note 3 supra
58
Maj. op. at 190
59
The district court's memorandum opinion never mentions the possibility that Green's counsel could have provided an expanded allocution
60
Cf. United States v. Hinton, 631 F.2d 769, 783 (D.C.Cir.1980) (remanding for clarification because although district court opinion "could be considered a ruling on 'likely prejudice,' ... (the district court did) not reveal what standard it relied upon in reaching its conclusion.")
61
624 F.2d at 206
62
Id
63
Id. at 208
64
Maj. op. at 189-190
65
See United States v. Grayson, 438 U.S. 41, 48, 98 S. Ct. 2610, 2614, 57 L. Ed. 2d 582 (1978) (sentencing judges have broad discretion; one partial way to guide that discretion is to give judges "as much information as reasonably practical concerning the defendant's 'character and propensities(,) ... his present purposes and tendencies,' and, indeed, 'every aspect of (his) life.' ") (citations omitted); United States v. Tucker, 404 U.S. 443, 446, 92 S. Ct. 589, 591, 30 L. Ed. 2d 592 (1972) ("a trial judge in the federal judicial system generally has wide discretion in determining what sentence to impose, ... (and) may appropriately conduct an inquiry broad in scope, largely unlimited either as to the kind of information he may consider, or the source from which it may come."); 18 U.S.C. § 3577 (1976) ("No limitation shall be placed on the information concerning the background, character, and conduct of a person convicted of an offense which a court of the United States may receive and consider for the purpose of imposing an appropriate sentence."); Tyler, Some Guideposts for the Compleat Sentencer, in JUSTICE IN SENTENCING 198, 203 (Orland & Tyler, eds. 1974) ("Notwithstanding occasional declarations of judges and lawyers to the contrary, humility and wisdom require that we constantly bear in mind that sentencing and correctional dispositions do not lend themselves to an exclusively legal approach and formulation. Another way of putting this point is to say that sentencers must be allowed discretion in order to comport with the notions of our society of just (treatment).")
66
See Mempa v. Rhay, 389 U.S. 128, 133-34, 88 S. Ct. 254, 256, 19 L. Ed. 2d 336 (1967); Carter v. Illinois, 329 U.S. 173, 178, 67 S. Ct. 216, 220, 91 L. Ed. 172 (1946) ("It is a commonplace that no more difficult task confronts judges than the determination of punishment not fixed by statute. Even the most self-assured judge may well want to bring to his aid every consideration that counsel for the accused can appropriately urge."); United States v. Pinkney, 551 F.2d 1241, 1248-51 (D.C.Cir.1976); Wolfs v. Britton, 509 F.2d 304, 311 (8th Cir. 1975) (counsel "has a substantial and very important role to perform in raising mitigating factors ... to the court at sentencing") (quoting American Bar Association Project on Standards for Criminal Justice, Standards Relating to the Prosecution Function and the Defense Function 227 (App.Draft 1971)); Kuh, Defense Counsel's Role in Sentencing, 14 Crim.L.Bull. 433 (1978) ("As long as judges in criminal matters retain broad discretion in imposing sentences, defense counsel's role may, if intelligently performed, do much to minimize that sentence that the court may impose." (Footnote omitted.)). As was said in Martin v. United States, 182 F.2d 225, 227 (5th Cir.), cert. denied, 340 U.S. 892, 71 S. Ct. 200, 95 L. Ed. 647 (1950)
The very nature of the proceeding at the time of imposition of sentence makes the presence of defendant's counsel at that time necessary if the constitutional requirement (of the assistance of counsel) is to be met. There is then a real need for counsel.... Then is the opportunity afforded for presentation to the Court of facts in extenuation of the offense, or in explanation of the defendant's conduct; to correct any errors or mistakes in reports of the defendant('s) past record; and, in short, to appeal to the equity of the Court in its administration and enforcement of penal laws. Any Judge with trial Court experience must acknowledge that such disclosures frequently result in mitigation, or even suspension, of penalty.
Moreover, counsel is the only participant in the sentencing process who can effectively attempt to check the abuses and distortions that arise out of the probation officer's control of information and the insular relationship of probation officer and trial judge. See Fennell & Hall, Due Process of Sentencing: An Empirical and Legal Analysis of the Disclosure of Presentence Reports in Federal Courts, 93 Harv.L.Rev. 1615, 1668-70 (1980). Indeed, "the sentencing stage is the time at which for many defendants the (attorney can perform his or her) most important service of the entire proceeding ...." American Bar Association Project on Minimal Standards for Criminal Justice, Standards Relating to Sentencing Alternatives and Procedures § 5.3(e) (App.Draft 1968) (hereinafter referred to as Sentencing Standards); see id. at § 5.3(f) & Comments a, h-n.
67
See United States v. Alton Box Board Co., 1977-1 Trade Cas. P 61,336, at 71,168 (N.D.Ill.1977) (sentencing judge "gives in depth consideration to the defendant's version of the offense, his prior record, if any, his family history, his marital history, his home and neighborhood, his education, his religious background, his special interests and leisure time activities, his physical, mental, and emotional health, his military history, if any, his employment record, his occupational record, his credit record and financial condition including his net worth, and his needs and the needs of others who depend upon him." (emphasis added)); R. Dawson, Sentencing: The Decision as to Type, Length, and Conditions of Sentence 200 (1969) (study of trial judges in Michigan indicates that they "attempt to make the minimum sentence reflect the total circumstances of the case. One judge, asked what factors he took into account in fixing the minimum, replied: 'Such matters as the convict's criminal record, family situation, circumstances of the crime in question, etc., are always taken into account by the court in fixing the minimum.' "); Wilkens, Kress, Gottfredson, Caplin & Gelman, Sentencing Guidelines: Structuring Judicial Discretion 8 (1978) (sentencing judges view employment history as most important measure of defendant's social stability); Ringold, A Judge's Personal Perspective on Criminal Sentencing, 51 Wash.L.Rev. 631, 640 (1976) ("At the time of sentencing, with the defendant before me, ... I study (inter alia ) his history and that of his family. I evaluate his education, his training and employment, the emotional and physical health of his family, and the nature of his prior conduct.")
68
See Williams v. New York, 337 U.S. 241, 247, 69 S. Ct. 1079, 1083, 93 L. Ed. 1337 (1949) ("A sentencing judge ... is not confined to the narrow issue of guilt.... Highly relevant-if not essential-to his selection of an appropriate sentence is the possession of the fullest information possible concerning the defendant's life and characteristics.... (P)revalant modern philosophy of penology (requires) that the punishment should fit the offender and not merely the crime."); United States v. Foss, 501 F.2d 522, 527 (1st Cir. 1974) ("any kind of mechanical sentence that steadfastly ignores individual differences is to be avoided"); S.1630, 97th Cong., 1st Sess., tit. III, sec. 125, § 994(d) (1981) (proposed revision of federal criminal code) (in establishing categories of defendants for purpose of sentencing guidelines, Sentencing Commission created under statute should take into account, to the extent relevant, matters including vocational skills, previous employment record, and family ties and responsibilities); Advisory Council of Judges of the National Council on Crime and Delinquency, Guides for Sentencing 38-39 (1957) ("The defendant whose parents, brothers, and sisters have respected society's demands of law and order, whose family life demonstrates mutual love and consideration, whose parents have given him reasonable and consistent discipline, and whose family members are eager to help him, is a better probation risk than one who does not have these advantages.... A history of stable, steady employment, with job changes made primarily for improvement, usually indicates good social adjustment.")
69
624 F.2d at 199, 208 (plurality opinion)
70
The majority opinion quotes at length from the district court's account of the facts of Green's crime. Maj. op. at 184. I do not know if it means to suggest thereby that Green's claim deserves a less careful hearing from this court than if his crime had not been so repugnant. If that is indeed the majority's attitude, it would be most unfortunate. Whether or not we believe that James K. Green deserves any measure of our solicitude, we at least owe ourselves a duty to insure that nothing in the process by which he was sentenced compromised society's interests in criminal dispositions that are accurate and, at least potentially, productive
71
See United States v. Pinkney, 551 F.2d 1241, 1249 (D.C.Cir.1976); Sentencing Standards, supra note 66, at § 5.3, Comment k; A. Campbell, Law of Sentencing § 102, at 330 (1978); M. Frankel, Criminal Sentences at vii (1972); Nemerson, Coercive Sentencing, 64 Minn.L.Rev. 669, 740 (1980)
72
The individualized sentence is an attempt to balance the needs of society and the needs of the defendant so as to improve as much as possible the fate of each. Moreover, the pronouncement of a criminal sentence, properly conceived,
forces the participants in the criminal process to confront anew the moral and political complexities inherent in the criminal act. The social and psychological factors underlying street crime may have so transformed some defendants that little hope exists for their rehabilitation. The safety of society may indeed require them to be incapacitated, particularly if the only available alternative is to return them to the twisted world of their origins. Such defendants are doubly cursed. In these cases, however, the very unearthing of the social and psychological factors will at least direct society's attention toward the strong possibility that these same factors will also transform a defendant's children or younger brothers and sisters. Our sense of criminal justice thus sensitizes our sense of social justice, and expands the criminal process into the political process.
Bazelon, Missed Opportunities in Sentencing Reform, 7 Hofstra L.Rev. 57, 61 (1978).
73
See United States v. Pinkney, 551 F.2d 1241, 1249 (D.C.Cir.1976); A. Campbell, supra note 71, at v, § 102 (Sentencing Standards, supra note 66, at § 5.3, Comment a | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/405062/ | 680 F.2d 261
Andrew FLOWERS, Petitioner, Appellant,v.Michael FAIR, Respondent, Appellee.
No. 82-1050.
United States Court of Appeals,First Circuit.
Argued May 7, 1982.Decided June 8, 1982.
Owen S. Walker, Federal Defender, Boston, Mass., for appellant.
Linda G. Katz, Asst. Atty. Gen., Boston, Mass., with whom Francis X. Bellotti, Atty. Gen., Stephen R. Delinsky, Chief, Crim. Bureau, Barbara A. H. Smith, Asst. Atty. Gen., Chief, Crim. Appellate Div., and Lisa Demasi, Boston, Mass., were on brief, for appellee.
Before CAMPBELL, BOWNES and BREYER, Circuit Judges.
PER CURIAM.
1
Andrew Flowers appeals from the denial by the district court of his petition for habeas corpus brought pursuant to 28 U.S.C. § 2254. He asserts that his constitutional rights to a speedy trial and to effective assistance of counsel were violated in his 1976 trial in a Massachusetts superior court for the armed robbery of a Radio Shack store. We affirm the district court's decision.
2
While it is true that 19 months passed between Flowers's indictment and his final trial, the district court found, based upon a careful review of the record, that this was not caused by deliberate delay on the part of the Commonwealth of Massachusetts. We agree. The worst that can be said of the state is that it lost track of the case while successfully prosecuting Flowers on two other separate robbery charges and a kidnapping indictment. Flowers, meanwhile, contributed somewhat to the delay of his own case by discharging his first court-appointed counsel. In addition, Flowers failed to raise any speedy trial objection until some 16 months after his indictment, though the record at least suggests that either he or his attorney (or both) were aware of the indictment much earlier. Finally, and perhaps most importantly, Flowers's only claim of prejudice is a belated, uncorroborated assertion that an alibi witness was lost to him as a result of the delay. In view of the strong evidence presented against Flowers at trial, however, it is mere conjecture whether this witness, should she have actually existed, would have created a reasonable doubt where none existed in the jury's mind. Nor was Flowers prejudiced by loss of liberty. Because of his other crimes, Flowers would have remained incarcerated throughout the period at issue here regardless of the delays in his trial for the Radio Shack robbery. In light of these considerations, we think the district court correctly balanced the four factors of length and reason for delay, timely assertion of the right, and possible prejudice articulated in Barker v. Wingo, 407 U.S. 514, 532, 92 S. Ct. 2182, 2192, 33 L. Ed. 2d 101 (1972), and supportably found that no speedy trial right was implicated.
3
On Flowers's sixth amendment right to counsel claim, we agree with the district court that there is no mechanistic constitutional requirement that trial courts conduct extensive inquiries into the reasons why a defendant may wish to discharge appointed counsel on the eve of trial when the defendant himself offers no specific complaints of his lawyer's service. See Maynard v. Meachum, 545 F.2d 273, 277 (1st Cir. 1976); Peters v. Gray, 494 F.2d 327, 329 (7th Cir. 1974). Moreover, in this case the Superior Court ultimately inquired of the appointed counsel regarding his degree of preparation, warned Flowers of the dangers of proceeding pro se, and was satisfied enough with his inquiry to make a specific record finding near the end of the trial that Flowers sought only delay with this tactic. We thus find no constitutional violation under the circumstances here present.
4
Affirmed. | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1646340/ | 480 So.2d 744 (1986)
Dr. Stephen M. DEPNER
v.
Susan Benton DEPNER.
No. 85-C-2283.
Supreme Court of Louisiana.
January 13, 1986.
Denied.
DENNIS and LEMMON, JJ., would grant the writ. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1646344/ | 9 So.3d 866 (2009)
STATE of Louisiana
v.
Everette OFFRAY.
No. 2008-KP-2213.
Supreme Court of Louisiana.
June 5, 2009.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2859419/ | Lavaca-Navidad
TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-94-00306-CV
Lavaca-Navidad River Authority; Texas Water Development
Board; and City of Corpus Christi, Texas, Appellants
v.
City of Corpus Christi, Ex Rel. Henry Berryhill, Frank Hankins, Gloria Perez, Joe
O'Brien, Dorothy McLaren; and Coastal Bend Sierra Club Group, Inc., Appellees
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 201ST JUDICIAL DISTRICT
NO. 94-01851, HONORABLE JERRY DELLANA, JUDGE PRESIDING
The Lavaca-Navidad River Authority (the "LNRA") instituted this declaratory
judgment action seeking validation of certain contracts and related securities. See Tex. Rev. Civ.
Stat. Ann. art. 717m-1 (West Supp. 1995). The LNRA, the City of Corpus Christi, and the Texas
Water Development Board (the "TWDB") (1) appeal that portion of the trial court's judgment
invalidating a water supply contract ("Supply Contract No. 4") between the LNRA and the City
of Corpus Christi (the "City"). The trial court's judgment adopted the argument of appellees, five
City taxpayers and the Coastal Bend Sierra Club Group, Inc. (collectively, "Taxpayers"), that,
in order to be valid, Supply Contract No. 4 had to be approved in a City-wide election. We will
reverse that portion of the trial court's judgment presented on this appeal and will render judgment
declaring Supply Contract No. 4 valid and sufficient to support the issuance of bonds.
BACKGROUND
The LNRA is a conservation and reclamation district created by the legislature. (2)
It owns and controls forty-three percent of Lake Texana in Jackson County and is in the process
of acquiring ownership of the remaining fifty-seven percent from the TWDB. Over the past
fourteen years, the LNRA has entered into four water supply contracts providing for the sale of
water from Lake Texana. Three of the contracts also provide for the issuance and sale of
securities to finance water delivery facilities and to fund the purchase of the TWDB's interest in
the lake. The LNRA filed this action seeking a declaration validating these contracts and
securities. The dispute concerns only Supply Contract No. 4.
Supply Contract No. 4 provides that each year for forty-two years the LNRA will
sell and deliver to the City up to 41,840 acre-feet of water from Lake Texana. From its water
revenues, the City must pay its proportionate share of the Lake Texana debt and operating and
maintenance expenses, as well as the debt service and operating expenses on its own facilities.
Supply Contract No. 4 authorizes the LNRA to issue bonds for financing the pipeline required to
transport water from Lake Texana to the City, as well as bonds to generate revenue for partially
financing the LNRA's purchase of the TWDB's interest in Lake Texana. The City Council
approved Supply Contract No. 4; the matter was not submitted to the City's voters.
The LNRA filed suit seeking a declaratory judgment validating the four water
supply contracts and confirming its authority to issue bonds pursuant thereto. See Tex. Rev. Civ.
Stat. Ann. art. 717m-1, § 2. The City answered with pleadings in support of Supply Contract No.
4. Formosa Plastics Corporation, Inteplast Corporation, and the TWDB, all parties to LNRA
water supply contracts, intervened in support of all contracts and bonds subject to the suit. (3) The
Attorney General, a statutory defendant, (4) answered but expressed no position either in support of
or in opposition to the validity of Supply Contract No. 4. The Taxpayers intervened contesting
only Supply Contract No. 4. They alleged the contract was invalid because city voters had not
approved it in an election as required by the City's charter (the "Charter"). The Taxpayers did
not contest the other contracts and bonds subject to the requested declaratory relief.
The cause was tried without a jury. The trial court declared all LNRA contracts
and securities valid except Supply Contract No. 4, which the court declared to be invalid and
insufficient to support the issuance of bonds until approved by a majority vote at an election called
pursuant to article IX, section 10 of the Charter (hereinafter "Charter section 10"). The LNRA
and the City appeal the trial court's judgment as to Supply Contract No. 4. Appellants complain
on appeal that the trial court erred in declaring Supply Contract No. 4 invalid because (1) it is not subject to the Charter provision requiring voters' approval, but even if the provision
is so construed, (2) the overriding state law does not require an election.
DISCUSSION
The issue presented on appeal is whether Charter section 10 requires voter approval
of Supply Contract No. 4 in order for it to be validly authorized. (5) The answer turns upon the
construction of this Charter provision.
I. Rules of Construction
Courts apply the same rules of construction to city charters, ordinances, or statutes.
See Mills v. Brown, 316 S.W.2d 720, 723 (Tex. 1958). A city charter should be interpreted as
if every word, phrase, and expression were deliberately chosen and used for a purpose.
Hammond v. City of Dallas, 712 S.W.2d 496, 498 (Tex. 1986). The charter should be construed
as a whole rather than through an examination of isolated provisions. Id. The court should not
presume any exception other than those specifically set forth. Unigard Sec. Ins. Co. v. Schaefer, 572 S.W.2d 303, 307 (Tex. 1978); Railroad Comm'n v. Olin Corp., 690 S.W.2d
628, 631 (Tex. App.--Austin 1985, writ ref'd n.r.e.).
Our construction is influenced by the fact that the City is a home rule city and
derives its power not from the Legislature but from the Texas Constitution. See Tex. Const. art.
XI, § 5; see also Tex. Rev. Civ. Stat. Ann. art. 1175 (West Supp. 1995) (enumerating home rule
city powers). Accordingly, the City may adopt any Charter provisions consistent with the general
laws of Texas or the constitution. See Tex. Const. art. XI, § 5; McCutcheon v. Wozencraft, 294
S.W. 1105, 1105-06 (Tex. 1927); City of Corpus Christi v. Unitarian Church, 436 S.W.2d 923,
927 (Tex. Civ. App.--Corpus Christi 1968, writ ref'd n.r.e.). These provisions, like city charter
provisions of all home rule cities, must be construed "in light of constitutional and statutory
provisions as they pertain to the charter provisions relating thereto." See Unitarian Church, 436
S.W.2d at 927. Powers of home rule cities may be limited only by their charters, the constitution,
or general law. Lower Colo. River Auth. v. City of San Marcos, 523 S.W.2d 641, 644 (Tex.
1975). Limitations may be express or implied, but they will not be implied unless they are clear
and compelling. Id. at 645.
Under the heading "Public Utilities," Charter section 10 provides that:
The city shall have power to own, maintain and operate, within or without the city
limits, any public utility, and the city council shall adopt appropriate
ordinances for the maintenance and operation thereof and fix the compensation to
be charged therefor. The city shall have power to purchase electricity, gas, oil or
any other article used by the public on such terms as the city may deem proper for
sale and distribution to the inhabitants of the city and adjacent territory; provided,
that no contract of purchase binding the city for a longer period than five years
shall be valid unless authorized by a majority vote at an election called for such
purpose.
(Emphasis added.)
Charter section 10 thus authorizes the City to own and operate any public utility
and empowers the City to "purchase [for sale to area inhabitants] electricity, gas, oil, or any other
article used by the public," subject to the restriction that a purchase contract with a term longer
than five years must be authorized by the voters. (Emphasis added.) The restriction in Charter
section 10 expressly applies to contracts for the purchase of electricity, gas, and oil; it does not
expressly apply to contracts for the purchase of water, which is the subject of Supply Contract No.
4. The restriction in Charter section 10 also applies to contracts for the purchase of "any other
article used by the public." Because we read every word and phrase in a city charter as if chosen
for a deliberate purpose, we must determine whether the Charter provision was intended to
include water purchases within the phrase "any other article." Otherwise, water purchase
contracts are not subject to any restriction requiring voter approval. We hold that water purchases
are not included.
II. Ejusdem Generis
When general words follow a specific list of subjects in a statute or a charter, the
meaning of the general words is restricted to encompass only the similar type or kind of subjects
specifically enumerated. Stanford v. Butler, 181 S.W.2d 269, 272 (Tex. 1944). This principle
of construction is known as the rule of "ejusdem generis." Id. Applying this rule, the phrase
"any other article" should not be broadly construed but instead limited to "things of the same kind
or class as specifically mentioned." See Ayala v. City of Corpus Christi, 507 S.W.2d 324, 327
(Tex. Civ. App.--Corpus Christi 1974, no writ) (construing phrase "any other public utility service
or enterprise" as limited to utilities only like those specifically enumerated). Appellants thus
emphasize how water differs from electricity, oil, and gas. (6) By analogy, in the context of mineral
classification, water is not a thing of like kind to oil and gas. Fleming Found. v. Texaco, Inc.,
337 S.W.2d 846, 852 (Tex. Civ. App.--Amarillo 1960, writ ref'd n.r.e.) (holding class of minerals
including oil and gas does not include water).
Taxpayers, however, argue that water is of the same kind or class of article as
electricity, oil, and gas and thus is encompassed by the general phrase following the specific list
of electricity, oil, and gas. Taxpayers ardently assert that the plain everyday meaning of "public
utility" includes water along with gas and electric utilities. (7)
Appellants acknowledge that a water system serving the public is a public utility.
The phrase in dispute, however, does not list utilities. Instead, it lists items that public utilities,
as businesses, might purchase: "electricity, gas, oil or any other article used by the public." Cf.
Ayala, 507 S.W.2d at 327 (construing general phrase "other public utility service or enterprise").
The specific list designates items to be purchased that are connected with energy production.
Water, often used by power plants to generate electricity, could be "of the same kind or class"
of the items specifically listed. However, in the instant case, the City requires the purchase of
water for municipal and industrial purposes, not for the generation of electric power.
We conclude that water, in most respects, is unlike the specifically enumerated
articles listed for purchase by public utilities in Charter section 10 yet has some similarities. We
thus look to other sources to aid our interpretation of the provision. (8)
III. History of Charter Section 10
In construing a statute, "a court may consider the object sought to be obtained and
the legislative history." Harris County Dist. Attorney's Office v. J.T.S., 807 S.W.2d 572, 574
(Tex. 1991). When determining the legislative intent of a statute, a court may examine the history
of the subject, the situation to be corrected, and the purpose to be accomplished. Magnolia
Petroleum Co. v. Walker, 83 S.W.2d 929, 934 (Tex.), cert. denied, 296 U.S. 623 (1935). When
determining the intent of those who adopt a city charter provision, our construction is guided by
similar inquiries. Accordingly, an earlier version of Charter section 10 offers insight into the
intent of the provision's adopters.
The predecessor provision (the "1939 Provision") read:
Public Utilities.- The city shall have power to own, maintain and operate, within
or without the city limits, complete water systems, gas plants, electric systems,
sewer systems, sewerage plants, abattoirs, fertilizer plants and other plants or
systems, incident to their effectual use, and the city council shall pass appropriate
ordinances for the maintenance and operation thereof and fix the compensation to
be charged therefor. The city shall have power to purchase electricity, gas, oil or
any other article used by the public on such terms as the city council may deem
proper, for sale and distribution to the inhabitants of the city and adjacent territory;
provided, that no contract of purchase binding the city for a longer period than five
(5) years shall be valid unless authorized by an election at which a majority of
those voting shall favor the making of such contract.
(Emphasis added.) The first sentence of the 1939 Provision did not merely refer generally to the
City's ownership of "any public utility" as is now the case. Instead, it specifically enumerated
a list of utilities the city might choose to undertake, including a water system. At the time, the
City operated only gas and water utilities. (9) Yet, even the 1939 Provision, as adopted, omits water
from the second sentence's list of articles requiring voter approval before long-term purchase.
In determining whether the word water is implied or was intentionally omitted from
the 1939 Provision, we further examine the source of the 1939 Provision language: former
paragraphs 11, 13, and 14 of article 1175 of the Revised Civil Statutes. Former paragraph 11 of
article 1175 detailed a home rule city's exclusive authority "to own, erect, maintain and operate
water works and [a] water works system." Act of Mar. 31, 1913, 33d Leg., R.S., ch. 147, § 4,
1913 Tex. Gen. Laws 307, 311 (Tex. Rev. Civ. Stat. Ann. art. 1175(11), since repealed and
codified at Tex. Loc. Gov't Code Ann. § 402.017(a) (West 1988 & Supp. 1995)). Separate from
paragraph 11, former paragraph 13 authorized home rule cities "to buy, own . . . maintain and
operate a system or systems, of gas, or electric lighting plant, . . . or any other public service or
public utility." Id. at 312 (Tex. Rev. Civ. Stat. Ann. art. 1175(13), since repealed and codified
at Tex. Loc. Gov't Code Ann. § 402.002(b) (West 1988)) (emphasis added). The first sentence
of the 1939 Provision incorporated similar language from article 1175(11) and (13).
Without reference to water, former paragraph 14 of article 1175 authorized cities
"to purchase and make contracts with any person or corporation for the purchasing of gas,
electricity, oil or any other commodity or article used by the public." Id. (Tex. Rev. Civ. Stat.
Ann. art. 1175(14), since repealed and codified at Tex. Loc. Gov't Code Ann. § 402.002(c) (West
1988)) (emphasis added). The second sentence of the 1939 Provision incorporated similar
wording. Former paragraph 14 did not list water, even though it was the subject of previous
paragraph 11, but specifically listed gas and electricity, the subjects of the immediately preceding
paragraph 13. The structure of former article 1175 gives no indication that the paragraphs dealing
with water and water works systems were related to the paragraphs dealing with gas, electricity,
and oil systems and purchases. Nothing suggests that water purchases were encompassed in the
phrase "any other commodity or article used by the public" as expressed in article 1175(14). (10)
In this respect, we recognize that courts are not at liberty to add language where
the drafters have refrained from doing so. Seay, 677 S.W.2d at 25. Legislative intent may be
inferred from the fact that an act does not contain a particular provision. State v. Jones, 570
S.W.2d 122, 123 (Tex. Civ. App.--Austin 1978, no writ). When drafters employ a term in one
place and omit it from another, it should not be implied where excluded. See Bott v. American
Hydrocarbon Corp., 458 F.2d 229, 233 (5th Cir. 1972); J. Ray McDermott & Co. v. Vessel
Morning Star, 457 F.2d 815, 818 (5th Cir.), cert. denied, 409 U.S. 948 (1972).
IV. City's Past Actions
Moreover, the City's past actions provide some evidence that the phrase "any other
article used by the public" was not intended to encompass water. When the meaning of a statute
is doubtful, the court may give weight to the construction placed upon it by the agency charged
with its administration. Tarrant Appraisal Dist. v. Moore, 845 S.W.2d 820, 823 (Tex. 1993);
Calvert v. Kadane, 427 S.W.2d 605, 608 (Tex. 1968); Meno v. Kitchens, 873 S.W.2d 789, 791
(Tex. App.--Austin 1994, writ denied). This construction is entitled to weight as long as it is
reasonable and does not contradict the plain language of the statute. Moore, 845 S.W.2d at 823.
Courts tend to adopt the construction placed upon ordinances by those authorized with
administration of the ordinances. Carrollton Civil Serv. Comm'n v. Peters, 843 S.W.2d 186, 189
(Tex. App.--Dallas 1992, writ denied).
In the 1950s, the City entered into a series of water supply contracts with the
Lower Nueces River Water Supply District. Under a former statute, these water supply contracts
were subject to voter approval. (11) The water supply contracts as well as the City's ordinances
authorizing the contracts refer to this former statute as requiring voter approval of the contracts. (12)
None of the contracts refer to voter approval required pursuant to any Charter provision. This
silence suggests that in the 1950s the City did not construe Charter section 10 to require voter
approval of water supply contracts.
V. Charter Structure
The structure of the current Charter also indicates that Charter section 10 does not
apply to water purchases. While Charter section 10 no longer specifically references water or
water works in its first sentence, the Charter nevertheless specifically references water in article
IX, section 11, entitled "Water Supply Contracts for Sale of Untreated Water" (hereinafter
"Charter section 11"). Charter section 11, originally adopted in 1968, authorizes the City to
"contract to provide untreated water for a definite period of time or in perpetuity." The City may
enter into these contracts, notwithstanding other Charter provisions, by ordinance without voter
approval. (13) Charter section 11 clarifies the City's power to sell untreated water. Along with other
provisions in the original and 1938 Charters, it also indicates that when the City intended Charter
provisions to pertain to water, it expressly so provided in the Charter. (14)
We will not imply a limitation on the broad powers of a home rule city when a city
charter does not expressly set forth one. See Lower Colo. River Auth., 523 S.W.2d at 645. Our
examination of Charter section 10 does not reveal a clear and compelling provision or intent
requiring voter approval of the City's long-term water purchase contracts, nor does a review of
the structure of the entire Charter indicate such a requirement. See id. As such, we do not
construe Charter section 10 as requiring that voters approve long-term water purchase contracts.
Accordingly, we hold that water supply contracts are not included in the scope of Charter section
10; therefore, the Charter does not require voter approval to validate Supply Contract No. 4. We
sustain appellants' points of error complaining that the Charter does not require voters to approve
Supply Contract No. 4.
CONCLUSION
In light of our construction of Charter section 10, we hold that the judgment
declaring Supply Contract No.4 invalid is erroneous. In a declaratory judgment action, this court
has a duty "to render such judgment as the trial court should have rendered." See NRG
Exploration, Inc. v. Rauch, 671 S.W.2d 649, 653 (Tex. App.--Austin 1984, writ ref'd n.r.e.).
We therefore reverse the judgment of the trial court and render judgment declaring Supply
Contract No. 4 to be valid in all respects and sufficient to support issuance of bonds. Our holding
precludes the need to reach appellants' second argument that the overriding state law does not
require an election.
Marilyn Aboussie, Justice
Before Justices Powers, Aboussie and B. A. Smith
Reversed and Rendered
Filed: July 12, 1995
Do Not Publish
1. The TWDB's brief, entitled "Brief of Appellee Texas Water Development Board,"
prays for a judgment declaring legally sufficient water supply contracts to be valid. Upon
the LNRA and the City's motion, the TWDB has been realigned as an appellant in this
appeal.
2. See Tex. Const. art. XVI, § 59; Act of May 15, 1941, 47th Leg., R.S., ch. 361, art. II,
§ 1, 1941 Tex. Gen. Laws 568, 574-75. The LNRA controls, stores, preserves, and
distributes waters of the rivers and streams of Jackson County for domestic, municipal, flood
control, irrigation, and other useful purposes. Tex. Const. art. XVI, § 59.
3. Formosa Plastics and Inteplast Corporation have been dismissed from the appeal.
4. See Tex. Rev. Civ. Stat. Ann. art. 717m-1, § 4. The Attorney General has been
dismissed from the appeal.
5. Before trial, the parties stipulated as follows:
[Taxpayers] dispute[] the validity of Supply Contract No. 4, and any
collateral matters depending upon its validity, asserting that in order for the
contract to be valid an election must be held, and the contract approved,
pursuant to Article IX, § 10, of the City Charter of the City of Corpus
Christi.
In all other respects, the validity of the bond issues, contracts, and other
matters presented by [the LNRA's] Original Petition are uncontested.
6. Among other differences, appellants note that water, unlike electricity, oil, and gas,
(1) is a uniquely scarce resource owned and controlled exclusively by the state or its
governmental entities; (2) must be acquired from the state and as such the right to use it
is a constitutionally protected property right; (3) must be obtained where supplies are
located and may thus require years to obtain a dependable supply; (4) is traditionally
associated with long-term contracts; and (5) is essential to needs of human existence.
7. Taxpayers also claim water is similar to electricity, oil, and gas because, among
other reasons, (1) oil, gas, and water are all carried in pipelines; (2) all four of the items
are traditionally listed as city utilities; (3) all four items are metered goods; and (4) all
four are essential infrastructure items for municipal development.
8. Taxpayers alternatively argue that ejusdem generis should not apply to Charter section
10, contending that the voter approval restriction for long-term contracts "is a flat requirement
for all public utility purchase contracts" regardless of specific or general categories.
Taxpayers offer no authority for this argument, and we find it without merit.
9. The record indicates that the City has never operated electric or oil utility systems.
10. Taxpayers argue that case law interpreting article 1175 indicates otherwise. They
cite Gillam v. City of Fort Worth, 287 S.W.2d 494 (Tex. Civ. App.--Fort Worth 1956, writ
ref'd n.r.e.), for the proposition that the phrase "any other commodity or article used by the
public" authorizes water purchases. We disagree. Gillam does not expressly address the
absence of the word water from article 1175(14). Id. at 498-99 (upholding authority of City of
Fort Worth to sell water outside city limits primarily based on former article 1108 of the
Revised Civil Statutes, which expressly authorized sales of water to any person or corporation
outside city limits).
11. See Act of May 26, 1949, 51st Leg., R.S., ch. 342, § 3, 1949 Tex. Gen. Laws 667,
667-68 (Tex. Rev. Civ. Stat. Ann. art. 1109e, since repealed and codified at Tex. Loc. Gov't
Code Ann. § 402.020(f) (West 1988)).
12. One ordinance states: "It is necessary under authority of . . . Article 1109e, . . .
before entering the contract for such purpose of obtaining water for the Water Supply of
the City . . . , to submit such contract to an election of [the City's] qualified voters . . . ."
Each water supply contract states something to the effect that "[t]he parties hereto are
given the power to make and enter into this contract pursuant to the provisions of . . .
Article 1109e, . . . the said authority of the City to so contract now having been
confirmed by an election duly held for that purpose in said City in accordance with and
as required by said Statute."
13. Taxpayers assert that because the City can enter into water sales contracts without
voter approval, notwithstanding other provisions of the Charter, Charter § 10 must
require voter approval for contracts for the purchase of water. However, the
"notwithstanding" language of Charter § 11 could apply to any number of Charter
provisions in existence at the time of its adoption, including provisions limiting the City's
general contracting power and power to extend the existing water works system. See
Charter art. X, § 2 & art. IX, § 31 (1909, amended 1987).
14. The 1939 Charter included a provision for the regulation of utility rates which
included the City Council's "power to fix and regulate the price of water, gas, electric
lights and power." Charter, art. VIII, § 14 (1939, amended 1987). The 1939 Charter
also included specific sections providing for water and gas connections. Id. § 16. The
original Charter included specific sections for the establishment of a water works system and
the extension thereof. Charter, art. IX, §§ 30, 31 (1909, amended 1987).
n must be held, and the contract approved,
pursuant to Article IX, § 10, of the City Charter of the City of Corpus
Christi.
In all other respects, the validity of the bond issues, contracts, and other
matters presented by [the LNRA's] Original Petition are uncontested.
6. Among other differences, appellants note that water, unlike electricity, oil, and gas,
(1) is a uniquely scarce resource owned and controlled exclusively by the state or its
governmental entities; (2) must be acquired from the state and as such the right to use it
is a constitutionally protected property right; (3) must be obtained where supplies are
located and may thus require years to obtain a dependable supply; (4) is traditionally
associated with long-term contracts; and (5) is essential to needs of human existence.
7. Taxpayers also claim water is similar to electricity, oil, and gas because, among
other reasons, (1) oil, gas, and water are all carried in pipelines; (2) all four of the items
are traditionally listed as city utilities; (3) all four items are metered goods; and (4) all
four are essential infrastructure items for municipal development.
8. Taxpayers alternatively argue that ejusdem generis should not apply to Charter section
10, contending that the voter approval restriction for long-term contracts "is a flat requirement
for all public utility purchase contracts" regardless of specific or general categories.
Taxpayers offer no authority for this argument, and we find it without merit.
9. | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1588506/ | 944 So. 2d 375 (2006)
CONLEY
v.
STATE.
No. 5D06-1885.
District Court of Appeal of Florida, Fifth District.
November 28, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2413889/ | 737 S.W.2d 499 (1987)
Walter E. GILOMEN, Jr., Respondent,
v.
SOUTHWEST MISSOURI TRUCK CENTER, INC., Appellant.
No. 14831.
Missouri Court of Appeals, Southern District, Division One.
September 29, 1987.
*500 Richard C. Miller, Lee Ann Miller, Woolsey, Fisher, Whiteaker & McDonald, Springfield, for appellant.
Stephen P. Seigel, P.C., Springfield, for respondent.
CROW, Chief Judge.
Walter E. Gilomen, Jr., ("Gilomen") sued Southwest Missouri Truck Center, Inc., ("Southwest") for breach of a contract wherein Gilomen agreed to sell, and Southwest agreed to buy, a parcel of real estate owned by Gilomen. Southwest counterclaimed against Gilomen, averring that Gilomen breached the contract. Trial by jury produced a verdict in favor of Southwest on Gilomen's claim,[1] and a verdict in favor of Southwest on its counterclaim. The jury assessed Southwest's damages at $12,500. The trial court entered judgment in accordance with the verdicts.
Gilomen thereafter filed a timely motion for a new trial. The trial court granted the motion, ordering a new trial on all issues. Southwest appeals from that order. § 512.020, RSMo 1986.
Paragraph 8 of Gilomen's motion for a new trial stated:
"The Court should grant a new trial for the reason that the verdict was against the weight of the evidence since there was no credible evidence from which the jury could have found that [Gilomen] breached any contract or that [Southwest] sustained any damages."
The trial court's "Amended Order Granting Plaintiff a New Trial" provided, among other things:
"Paragraph number 8 of [Gilomen's] Motion for New Trial is sustained. Specifically, the trial Court grants [Gilomen's] Motion and a new trial is ordered upon the ground that the jury verdict is against the weight of the evidence and testimony submitted at trial, and therefore to avoid injustice, orders that the verdict and judgment heretofore entered are set aside and a new trial is ordered on all issues.
The trial Court by sustaining same on the ground above stated exercises its discretion pursuant [to] Supreme Court Rule 78.02 therein providing that one new trial may be ordered by the trial Court on that issue only, and the trial Court declares this is the first and only new trial so granted."
Southwest maintains the trial court erred in ordering a new trial on the above-stated grounds. In considering Southwest's contention, we begin by acknowledging Veach v. Chicago and North Western Transportation Co., 719 S.W.2d 767 (Mo. banc 1986), where it is said:
"If a trial court grants a new trial on the ground that the verdict is against the weight of the evidence, appellate courts will decline `to weigh the evidence in cases before them on appeal.' Clark v. Quality Dairy Company, 400 S.W.2d 78, 80 (Mo. 1966). `Rule 78.02 continues the authority and discretion of the trial court to grant one new trial on the ground the verdict is against the weight of the evidence.'" Id. at 769[1].
We next remind the parties that in the instant case there were two verdicts, one on Gilomen's claim (Verdict A), and one on Southwest's counterclaim (Verdict B). As will become apparent infra, each must be considered separately. We begin with Verdict A.
To state a cause of action for breach of contract, a plaintiff must allege (a) the making and existence of a valid and *501 enforceable contract between the plaintiff and the defendant, (b) the right of the plaintiff and the obligation of the defendant thereunder, (c) a violation thereof by the defendant, and (d) damages resulting to the plaintiff from the breach. U.S. Suzuki Motor Corp. v. Johnson, 673 S.W.2d 105, 106[3] (Mo.App.1984); Johnson v. Great Heritage Life Insurance Co., 490 S.W.2d 686, 691[11] (Mo.App.1973). To make a submissible case, each and every element essential to liability must be predicated upon legal and substantial evidence. MacFab Products, Inc. v. Bi-State Development Agency, 726 S.W.2d 815, 819[5] (Mo. App.1987); Shackelford v. West Central Elec. Co-Op., Inc., 674 S.W.2d 58, 63[10] (Mo.App.1984). The mere breach of a contract which causes no loss to the plaintiff will not sustain a suit by him for damages. Pasquel v. Owen, 186 F.2d 263, 271[16] (8th Cir.1950). Cf. Beuc v. Morrissey, 463 S.W.2d 851, 856[7] (Mo. banc 1971).
Southwest asserts there was no evidence to support a finding that Gilomen sustained any loss by reason of Southwest's alleged breach. Consequently, says Southwest, Gilomen failed to make a submissible case on his claim against Southwest.
Southwest correctly points out that an order granting a new trial on the ground that the verdict was against the weight of the evidence is arbitrary and an abuse of discretion when the benefiting party fails to make a submissible case. Fischer v. Famous-Barr Co., 646 S.W.2d 819, 821[3] (Mo.App.1982); Kreutz v. Wolff, 560 S.W.2d 271, 279[17] (Mo.App. 1977). In such circumstances, an appellate court must set aside the award of the new trial. Cunningham v. Bellerive Hotel, Inc., 490 S.W.2d 104, 107[1] (Mo.1973). Consequently, the scope of our inquiry, so far as Verdict A is concerned, is whether there was sufficient evidence to support a verdict for Gilomen on his claim, had the jury returned one. McCann v. Burns, 308 S.W.2d 631, 633[1] (Mo.1958). It follows that we must determine whether there was any evidence that Gilomen sustained damage.
The contract, dated May 1, 1982, stated the purchase price was $348,912.36, and that a $10 "[e]arnest deposit" was made contemporaneously with the signing, leaving a balance of $348,902.36 to be paid "on closing date." Closing was to take place June 30, 1982; however, the parties subsequently agreed to extend the date to July 30, 1982, and then to August 11, 1982. Gilomen and Southwest's president, Robert B. Schilli, met on the latter date for the purpose of closing, but no closing occurred. There was conflicting evidence as to why. Each party's evidence tended to show that the other party breached the contract. We need not synopsize the evidence on that issue, as it has no effect on the outcome of the appeal.
Gilomen testified that the fair market value of the subject real estate on June 30, 1982, was $350,000. He added that its value would have been the same on July 30, 1982, and August 11, 1982. Gilomen presented no other evidence as to the value of the tract on those dates.
Southwest's evidence showed the fair market value as of June 30, 1982, and July 30, 1982, was $370,000.
Southwest emphasizes that a seller's measure of damages for a buyer's breach of a contract to purchase realty is the difference between the contract price and the value of the realty on the day the contract should have been completed. Allen v. Foster, 668 S.W.2d 277, 280[2] (Mo. App.1984); Leonard v. American Walnut Co., Inc., 609 S.W.2d 452, 455[5] (Mo.App. 1980). Southwest insists that inasmuch as all of the evidence showed the fair market value of the subject tract at all times material herein was more than the sum Gilomen would have received had the sale been closed, Gilomen failed to show he had been damaged by Southwest's alleged breach. Accordingly, says Southwest, no submissible case was made on Gilomen's claim.
Nowhere in his briefs[2] does Gilomen refute Southwest's contention or explain how he was damaged, and in our analysis of the point we find no flaw in Southwest's premise. *502 We therefore hold that as there was no evidence to support a finding that Gilomen sustained damage because the sale failed to close, the trial court abused its discretion, and thereby erred, in ordering a new trial on Gilomen's claim on the ground that Verdict A was against the weight of the evidence.
The only other assignment of error in Gilomen's motion for a new trial that mightif meritoriousjustify the award of a new trial on his claim against Southwest was paragraph 10, which predicated error on the giving of instructions 7 and 11. Of those two, only instruction 7 pertained to Gilomen's claim against Southwest, so it is the only instruction germane to Verdict A.
The trial court, as we comprehend its amended order granting the new trial, sustained paragraph 10 of Gilomen's motion insofar as that paragraph complained of instruction 11. The trial court's order made no mention of instruction 7. The trial court's order did, however, state: "The Court herein rules against [Gilomen] on all remaining points set forth in [Gilomen's] Motion for new trial." Whether, by failing to mention instruction 7 in its order, the trial court meant to reject Gilomen's complaint about such instruction is, as shall become apparent, a matter on which we need not speculate.
Instruction 7 was the verdict-directing instruction on Gilomen's claim. The copy of instruction 7 in the record on appeal does not identify the party who tendered it, a violation of Rule 70.02(d), Missouri Rules of Civil Procedure (17th ed. 1986). We have therefore seined the segment of the transcript captioned "Instruction Conference" in an effort to ascertain who requested the trial court to give instruction 7. In that conference, Southwest's attorney said, "I object to all of [Gilomen's] instructions which would be ... beginning with 6, 7...." Southwest's attorney continued, "I primarily have specific objections to Instruction No. 7, which is [Gilomen's] Verdict Director." Still later, Southwest's attorney said, "Specifically with respect to Instruction No. 7, which is the verdict director, [Gilomen] has used MAI 26.06...."
Pertinent to our investigation, Gilomen's attorney said: "Your Honor, [Gilomen] objects generally to all of [Southwest's] instructions. Which would be Instructions No. 11, No. 13 and the verdict form B."
The only reasonable deduction from the above clues is that instruction 7 was given at the behest of Gilomen. That being so, even if instruction 7 be erroneous (an issue we need not decide), the error would not afford Gilomen a basis for a new trial on his claim against Southwest, as a party cannot complain about the giving of an erroneous instruction which such party requested. Sullivan v. KSD/KSD-TV, 661 S.W.2d 49, 51[4] (Mo.App.1983); Stevenson v. First National Bank of Callaway County, 604 S.W.2d 791, 795[8] (Mo. App.1980).
As Gilomen's motion for a new trial contained no further assignment of error relevant to the award of a new trial on his claim against Southwest, we set aside that portion of the trial court's order awarding a new trial on such claim.[3]
We turn now to Verdict B.
As noted in our discussion of Verdict A, a trial court has authority and discretion to grant one new trial on the ground that the verdict is against the weight of the evidence. Where there is substantial evidence to support a verdict for the party to whom the new trial was granted, the order of the trial court cannot be held to be an abuse of discretion. Kreutz, 560 S.W.2d at 279[18]; Day v. Mayberry, 421 S.W.2d 34, 38[2] (Mo.App. *503 1967). We must emphasize, however, that this principle applies only where the party bearing the burden of proof is the beneficiary of the order granting the new trial. Where the party who does not bear the burden of proof is the beneficiary of the order granting the new trial, the analysis is different.
In Phillips v. Phillips, 443 S.W.2d 144, 145-46[1] (Mo. banc 1969), it is said:
"Plaintiff contends that the [trial] court abused its discretion in granting defendant a new trial on the ground that the decree was against the weight of the evidence, because, since defendant presented no evidence, there was no evidence to weigh. The cases cited by plaintiff which may be said to be applicable to his point are, in general, cases involving the grant of a new trial to a plaintiff (who has the burden of proof and whose case must be supported by sufficient substantial evidence) on the ground the verdict was against the weight of the evidence, as distinguished from those involving the grant of a new trial to a defendant (who does not have that burden, who need present no evidence to prevail, and whose case need not be supported by sufficient substantial evidence) on that ground. This court held recently that where a new trial has been granted a defendant on the ground the verdict was against the weight of the evidence, the appellate court will not determine whether there was sufficient substantial evidence to sustain a verdict for that party. Lupkey v. Weldon, Mo., 419 S.W.2d 91, 93[2] [1967]." (Footnote omitted.)
In Lupkey, 419 S.W.2d at 93, the Supreme Court said:
"... we will overturn an order granting a new trial on the ground the verdict was against the weight of the evidence only in cases where no verdict in favor of the party at whose instance the new trial was granted `could ever be permitted to stand.'"
A cogent conspectus of Phillips and Lupkey appears in Breckle v. Van Dyke Brewing Co., 483 S.W.2d 672, 673[1] (Mo. App.1972):
"Where the order for new trial [on the ground that the verdict is against the weight of the evidence] is in favor of the plaintiff the appellate court determines whether there is sufficient substantial evidence to sustain a verdict for the plaintiff. But where the order for new trial is in favor of the defendant, who does not have the burden of proof and need produce no evidence to prevail, the appellate court does not make such determination. The Supreme Court of this state has clearly drawn this distinction in two recent cases, Phillips ... and Lupkey.... Both cases present the very question raised herethe granting of a motion for new trial to a defendant who had presented no evidence. As we read those cases we can overturn the trial court's order only if we can say as a matter of law that a jury verdict for the defendant could not be permitted to stand."
Southwest, of course, bore the burden of proof on its counterclaim against Gilomen, thus a verdict in Gilomen's favor on the counterclaim could be permitted to stand even had Gilomen presented no evidence. That being so, it is clear from Phillips, Lupkey and Breckle that the action of the trial court in ordering a new trial on Southwest's counterclaim against Gilomen on the ground that Verdict B was against the weight of the evidence cannot be disturbed by us on this appeal.
Having decided that, we need not consider the other grounds relied on by the trial court in ordering the new trial (which pertained to perceived instructional error on the counterclaim), nor need we address the other assignments of error briefed by Southwest attacking the new trial order.
That portion of the trial court's amended order awarding Gilomen a new trial on his claim against Southwest is reversed; that portion of the trial court's amended order awarding Gilomen a new trial on Southwest's counterclaim against him is affirmed. The cause is remanded to the trial court with directions to reinstate Verdict A, *504 and for further proceedings on Southwest's counterclaim against Gilomen. Costs of this appeal are taxed half against Southwest and half against Gilomen.
GREENE, P.J., and HOLSTEIN, J., concur.
NOTES
[1] Gilomen's petition was in two counts. The parties stipulate that Gilomen, prior to trial, "did waive Count I," and that the trial court submitted only Count II to the jury.
[2] Each party filed a brief and a supplemental brief.
[3] For a discussion of the procedural ramifications when a trial court grants a new trial for specified reasons, but rejects other assignments of error in a motion for a new trial that would have arguably justified the order, and an appellate court thereafter holds that the trial court erred in ordering the new trial for the reasons the trial court enumerated, see Cole v. St. Louis-San Francisco Ry. Co., 332 Mo. 999, 61 S.W.2d 344, 347[5-7] (banc 1933); Burke v. Moyer, 621 S.W.2d 75, 82[18, 19] (Mo.App.1981); Hoehn v. Hampton, 483 S.W.2d 403, 407[1, 2] (Mo.App. 1972). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2413891/ | 737 S.W.2d 29 (1987)
Joe L. SPILLER, et al, Appellants,
v.
Allen LYONS, et al, Appellees.
No. B14-86-617-CV.
Court of Appeals of Texas, Houston (14th Dist.).
July 16, 1987.
Otto D. Hewitt, III, J.D. Bashline, Galveston, for appellants.
Robert E. Hoskins, Galveston, for appellees.
Before PAUL PRESSLER, MURPHY and ELLIS, JJ.
OPINION
PAUL PRESSLER, Justice.
This is an appeal from the granting of a judgment n.o.v. Appellees wished to build a motel in the City of Hitchcock. Appellants, a group of homeowners in Hitchcock sued alleging a violation of deed restrictions which would create a nuisance. The jury returned a verdict in favor of appellants and on May 2, 1986, the court entered a judgment based upon the verdict. Appellees filed a motion for new trial on May 29th and a motion for judgment n.o.v. on June 20th which was later granted. We reverse the judgment n.o.v. and render judgment for appellants.
Appellants' first point of error is that the motion for judgment n.o.v. was not filed timely. It is well settled that such a motion may be filed at any time after the court has announced judgment and may be acted upon at any time before a motion for new trial has been overruled either by action of the court or by operation of law. Commercial Standard, Inc. Co. v. Southern Farm Bureau Casualty Insurance Co., 509 S.W.2d 387, 392 (Tex.Civ.App. Corpus Christi 1974, writ ref'd n.r.e.). The judgment n.o.v., in this case, was granted before appellees' motion for new trial was acted upon or overruled by operation of law. The first point of error is overruled.
*30 In points of error two and three, the appellants complain that the court erred in granting the judgment n.o.v. A judgment n.o.v. is remedy which should be used only in very limited circumstances. Wood v. Texas Farmers Insurance Co., 593 S.W.2d 777 (Tex.Civ.App.Corpus Christi 1979, no writ). To uphold such a judgment, it must be determined that there is no evidence upon which the jury could have made its findings. All testimony must be considered in a light most favorable to the party against whom the motion is sought and every reasonable deduction from the evidence is to be made in that party's favor. Dowling v. NADW Marketing, Inc., 631 S.W.2d 726, 728 (Tex.1982); Douglass v. Panama, Inc., 504 S.W.2d 776 (Tex. 1974). Jury findings may not be disregarded if the record contains any evidence of probative value which will reasonably support the findings. Lynch v. Ricketts, 158 Tex. 487, 314 S.W.2d 273 (1958); San Antonio Independent School District v. National Bank of Commerce of San Antonio, 626 S.W.2d 794 (Tex.App.San Antonio 1981, no writ).
The case was submitted to the jury on special issues. The jury unanimously found that the operation of a motel on appellees' property would create a nuisance. They also found that the developer of the subdivision in which the motel was to be built had a plan or scheme for restrictions on the use of property in the subdivision and that the construction and operation of a motel would violate those restrictions.
The evidence presented at trial by the residents of the neighborhood established that the increased traffic would be a danger to children walking to and from nearby schools. Appellants testified that their neighborhood was quiet and family-oriented and that traffic and the influx of strangers and transients would be an offense to normal sensibilities. Evidence was presented that there were no businesses, activities or attractions in Hitchcock that would draw potential motel customers. There was testimony that the present water and sewage services were already strained and that operation of a motel would further impair those services. No plans for enlarging those utilities had been made. In addition to the testimony of residents, the jury had the opportunity to view videotaped "tours" of the neighborhood presented by both parties. Appellants also presented evidence that restrictive covenants were in effect in the neighborhood and that the motel would violate those covenants.
It cannot be said that there was no evidence upon which the jury could have relied. The record indicates that the jury had evidence of sufficient probative value to support their findings. It was, therefore, error to grant appellees' motion for judgment n.o.v. Appellants' second and third points of error are sustained.
The judgment of the trial court is reversed and we render judgment that the Final Judgment and Permanent Injunction, signed on May 2, 1986, be in all things reinstated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2586153/ | 156 P.3d 39 (2007)
2007-NMCERT-003
STATE
v.
GARCIA.
No. 30,226.
Supreme Court of New Mexico.
March 1, 2007.
(COA 26,749). Denials of Certiorari. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919097/ | 912 So. 2d 43 (2005)
Catherine STANEK-COUSINS, Appellant,
v.
STATE of Florida, Appellee.
No. 4D05-1129.
District Court of Appeal of Florida, Fourth District.
August 31, 2005.
Rehearing Denied October 17, 2005.
*44 Michael Morris of Morris & Morris, P.A., West Palm Beach, for appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, Belle B. Schumann, Assistant Attorney General, Daytona Beach, and Laura Fisher Zibura, Assistant Attorney General, West Palm Beach, for appellee.
POLEN, J.
Appellant, Catherine Stanek-Cousins ("Cousins"), has timely appealed a conviction for manslaughter and sentence to fifteen years for the shooting death of her husband, Sean Cousins ("Sean"). This appeal was transferred to this court from the fifth district based upon its determination that venue had been transferred to the fifteenth circuit. Stanek-Cousins v. State, 896 So. 2d 865 (Fla. 5th DCA 2005). For the reasons explained herein, we affirm the conviction and sentence, and reverse the restitution order as to the amount only.
On November 21, 2002, Cousins and her co-defendant Timothy Koile ("Koile") were indicted in the Ninth Judicial Circuit in and for Osceola County, Florida, for the first degree murder of her husband, Sean. The indictment alleged that the murder occurred between May 6 and May 12, 2001, and occurred in Palm Beach, Martin, St. Lucie, Indian River, Brevard and Osceola counties. Cousins was held in jail in Osceola County while her ninth circuit public defender investigated the case for one year. The State filed its notice of intent to seek the death penalty on March 21, 2003. On March 24, 2003, six weeks before the trial date, Cousins sought to change venue from Osceola County to Palm Beach County based on the allegation in the indictment that the exact location of the offense was unknown and may have taken place anywhere from Palm Beach to Osceola counties. On April 8, 2003, the trial court issued an order transferring venue to the Fifteenth Circuit, in and for Palm Beach County. As the fifth district recently held, "Cousins elected to be tried in Palm Beach County, and the trial court granted the motion. Thus, venue was transferred, and she was tried and convicted in Palm Beach County, which is in the Fifteenth Judicial Circuit." Stanek-Cousins, 896 So.2d at 866.
The public defender representing Cousins moved to withdraw on April 3, 2003. The motion stated that Cousins did not waive her right to speedy trial and that speedy trial was set to expire on May 20, 2003. The motion also alleged that, over objection, the trial court directed the Osceola County Public Defender's office to represent Cousins at trial in West Palm Beach. The motion to withdraw stated that only Robert Wesley, the elected public defender, met the minimum standards for attorneys in capital cases and it would be an undue hardship to force him to go to West Palm Beach for a four-week trial. The trial court denied the motion, finding that Cousins refused to waive her speedy trial right; appointing another lawyer to represent Cousins would not give the new lawyer sufficient time to prepare to defend Cousins against the instant charge and still meet the speedy trial deadline. In the order, the trial court stated that it repeatedly explained the ramifications of counsel's dilemma to Cousins, but that Cousins insisted that she would not waive speedy trial. The Court concluded that the public defender who had been representing Cousins since arraignment was in *45 the best position to represent her in the upcoming trial.
The trial began on May 19, 2003 in Palm Beach County. Cousins and co-defendant Koile were tried simultaneously. The jury found her guilty of manslaughter and she was sentenced to fifteen years in prison and ordered to pay restitution. During the course of the trial, Koile pled guilty to the crime of second-degree murder.[1] The following evidence was adduced at trial:
Cousins and Sean were not happily married and Cousins was involved in a sexual relationship with her neighbor, Koile. Sean had previously obtained a life insurance policy in the amount of $500,000, naming Cousins as the primary beneficiary. On March 6, 2001, Sean and Cousins increased the policy to $1,000,000. Cousins signed the check activating the million dollar policy.
Koile testified that Cousins repeatedly told him that she wished Sean was dead. Koile suggested that he elicit his friend, Dan Bakovic, to help kill Sean. A meeting took place amongst the three of them, and Bakovic agreed to kill Sean for half of the insurance proceeds. Koile claimed that Cousins gave Bakovic $1,500 cash to purchase an untraceable weapon. Various emails and telephone records corroborate Koile's testimony. Bakovic was supposed to kill Sean at 9 p.m. in a movie theater parking lot on Sunday, May 6, 2001 when Cousins sent him outside to get her sweater, but Bakovic did not show up.
The following day, Monday, May 7, 2001, Koile received a page and phone call from Cousins in the evening demanding that he come to her house. When he arrived at Cousins' garage, he saw Sean lying on the garage floor, bloody, after having already been shot in the stomach. Sean cried and begged Cousins not to kill him. Koile claimed that Cousins handed him the gun and told him to kill Sean. He refused and Cousins then squatted down and shot him in the head. Bakovic showed up later that night and assisted Cousins and Koile with cleaning up the blood.
Prior to disposing of the body, Cousins used Sean's cell phone to call her own cell phone. Phone records confirm that Cousins never left her home while the calls were made. Koile and Bakovic drove Sean's body to Osceola County, where they dumped it in a creek. Phone records also showed that Koile and Cousins communicated many times the morning of Tuesday, May 8, 2001. The cell tower records showed that Koile was moving from Palm Beach County, through Martin, Indian River, Brevard and into Osceola County and back. Sean's body was found in an Osceola County creek.
The jury returned a guilty verdict to the lesser count of manslaughter. On September 16, 2003, the State filed its Notice of Intent to Request Restitution. Sentencing was held on September 19, 2003 at the Palm Beach County Courthouse. Cousins was sentenced to fifteen years in prison. Restitution was ordered, with jurisdiction reserved as to the amount. Cousins appealed the conviction and sentence on September 19, 2003. While the appeal was pending, the trial court held the restitution hearing on October 27, 2003 and rendered the written order on December 19, 2003, ordering Cousins and Koile to pay $17,696.33 to Patrick Cousins, Sean's father, $1,500.00 to Roseanne Cousins, Sean's mother, and $2,042,126.00 to the Estate of Sean Cousins. Cousins raises *46 several issues on appeal, which we address below.
First, we affirm the judge's rulings involving the venue transfer to the fifteenth circuit, as Cousins has failed to demonstrate that the trial court abused its discretion or that any alleged procedural error was harmful. The standard of review for an order on a motion to transfer venue is abuse of discretion. See D.M. v. J.D.M. ex rel C.F., 814 So. 2d 1112 (Fla. 4th DCA 2002).
Cousins argues that the trial court erred when it allowed the clerks, state attorneys, and public defenders[2] from the ninth circuit to participate in the case in the fifteenth circuit after the trial court granted Cousins' election of venue to the fifteenth circuit, and when it ordered the parties to file all of their pleadings with the ninth circuit case number.[3] Cousins contends that once the trial court granted her election to transfer the case to the fifteenth circuit, the ninth circuit no longer had jurisdiction to take any further action other than to transfer the case. Therefore, she claims, allowing the ninth circuit to remain "involved" constituted error. We disagree with her contention and hold that Cousins received exactly what she requested a fair and impartial trial in the fifteenth circuit, where she elected venue.[4] Moreover, she also received her speedy trial. The trial court entered an order granting Cousins' election of venue to the fifteenth circuit. The trial and sentencing were conducted in the fifteenth circuit. We underscore the fact that Cousins elected this venue change shortly before the scheduled trial date in a capital case, while at the same time refusing to waive her speedy trial rights. In the instant case, if any error was committed in honoring Cousins' demand for a speedy trial, Cousins clearly invited the error. See Ashley v. State, 642 So. 2d 837 (Fla. 3d DCA 1994) ("In the instant case, if any error was committed in honoring the defendant's demand for speedy trial, the defendant clearly invited the error. Therefore, the defendant cannot take advantage on appeal of the situation he created at trial.").
Here, the trial judge accompanied the case to the fifteenth circuit as permitted under Florida Rule of Judicial Administration 2.180(b).[5] Because venue was transferred to the fifteenth circuit, the fifth district lacked jurisdiction to hear the appeal and properly transferred the appeal to this court. See Vasilinda v. Lozano, 631 So. 2d 1082, 1085 (Fla.1994) (when venue is transferred to another jurisdiction and case is concluded in new jurisdiction, review of judgment is properly commenced in appellate court which has jurisdiction over transferee court).
Cousins points to the principle that "[c]hanges of venue in criminal cases do *47 not become effective until the court file has been received in the transferee court." See Vasilinda, 631 So.2d at 1087.[6] Cousins claims that error occurred because the ninth circuit clerk physically transported the file to the fifteenth circuit and functioned as the clerk at trial. Even assuming the ninth circuit clerk did not give the court file to a fifteenth circuit clerk, it can be argued that the transfer was effective when the trial actually occurred in a courtroom at the Palm Beach county courthouse. Moreover, Cousins provides no explanation for how she was prejudiced by the ninth circuit clerk accompanying the presiding judge when venue was transferred. Additionally, Cousins cites no authority for her position that her constitutional right to elect venue also includes the right to select the state attorney's office to prosecute her case, the public defender's office to defend her case, or the clerk to receive evidence and swear in witnesses at trial. See also Hart v. State, 144 Fla. 409, 198 So. 120 (1940) (a state attorney may be sent into another circuit because qualified from his experience to prosecute a particular offense, or he may be assigned to another circuit to insure a speedy trial, where the docket has become burdensome). Based on the foregoing, we affirm the rulings below involving the venue transfer, as Cousins has failed to demonstrate that the trial court abused its discretion or that any alleged procedural error was harmful.
In a related issue, Cousins contends that the trial court exceeded its territorial jurisdiction when during trial, on its own motion, the trial court rendered an order directing the clerk of the court not to accept any filings not identified as being filed in the Ninth Judicial Circuit.[7] During trial, the trial court stated that the parties had to keep the Osceola County case style and number because the case was not assigned to a new case number in Palm Beach County. Cousins' underlying premise that the trial court's order constituted a ruling that the trial was taking place in the ninth circuit is incorrect. The court merely ordered that any pleadings filed with the court contain the original ninth circuit's case style and number because, as it explained, the case was not assigned a new case number in Palm Beach County. Cousins has failed to demonstrate any reversible error in the court's instruction to the parties to use the original ninth circuit's case style and number.
*48 We agree with Cousins, however, that the trial court acted without jurisdiction when it determined the amount of restitution after Cousins filed her Notice of Appeal. Questions of subject matter jurisdiction are reviewed de novo. Jacobsen v. Ross Stores, 882 So. 2d 431, 432 (Fla. 1st DCA 2004). Here, Cousins was sentenced on September 19, 2003. The trial court imposed restitution at sentencing, but the trial court reserved jurisdiction to determine the amount at a later date. Cousins also filed her appeal on September 19, 2003. The trial court held the restitution hearing on October 27, 2003, and rendered the written order on December 19, 2003, ordering Cousins and Koile to pay $17,696.33 to Patrick Cousins, $1,500.00 to Roseanne Cousins, and $2,042,126.00 to Sean's Estate.
This court has held that "[a] trial court does not have jurisdiction to hold a restitution hearing or enter an order of restitution after a notice of appeal has been filed," even where restitution was ordered at sentencing but the amount reserved. Marro v. State, 803 So. 2d 906 (Fla. 4th DCA 2002); see Craig v. State; 766 So. 2d 257 (Fla. 4th DCA 2000). Based on Marro and Craig, the proper result is for this court to strike the order of restitution; "[h]owever, because the trial court reserved jurisdiction to hold a restitution hearing, restitution may be reimposed on remand." Marro v. State, 803 So.2d at 906. We note that, where the hearing is not set to occur until after notice of appeal has been filed, the better practice would be to ask this court to relinquish jurisdiction to allow the trial court to hold a hearing as to the amount of restitution.
As to the remaining issues Cousins raises on appeal, we find them to be unpersuasive and decline to address them individually.
Affirmed in Part, Reversed in Part, and Remanded.
STEVENSON, C.J., and CROW, DAVID F., Associate Judge, concur.
NOTES
[1] In exchange for his plea and testimony against Cousins, he received a sentence between eight and ten years followed by five years of probation.
[2] We also note that, with respect to the issue of the public defender traveling from the ninth circuit, this issue is barred by the law of the case doctrine because Cousins already sought review of this claim by emergency extraordinary writ filed originally with the Supreme Court but transferred to the fifth district. See Wesley v. State, No. 5D03-1351 (Fla. 5th DCA April 30, 2003).
[3] Cousins does not state how, if any error occurred, she was harmed by the ninth circuit case number on the filings.
[4] We also reject Cousins' alternative argument that no valid transfer of venue took place. Cousins claims that the transfer of venue did not occur because the ninth circuit clerk failed to transmit the file to the fifteenth circuit clerk and because the case was not assigned a fifteenth circuit case number.
[5] "The presiding judge from the originating court shall accompany the change of venue case, unless the originating and receiving courts agree otherwise."
[6] It should be noted that the facts surrounding Vasilinda are distinguishable from the present case. Vasilinda addressed which appellate court had jurisdiction when a criminal case is transferred and the trial judge accompanies the case. Vasilinda dealt with the retrial of a police officer whose motion for change of venue should have initially been granted. On remand, the trial judge entered an order which had the effect of prohibiting the media from publicly identifying the jurors. A television journalist filed a motion to modify the order with respect to its prohibition. The trial judge denied the motion. The journalist sought review of the denied order in the third district. Because of the change in venue, the journalist should have sought review in the fifth district.
[7] Cousins relies on Kohut v. Evans, 623 So. 2d 569 (Fla. 4th DCA 1993). In Kohut, the trial judge transferred venue for the purpose of selecting a jury. After jury selection, the trial judge chose to return the case to the original county. This court held that the trial judge acted in excess of his jurisdiction. However, Kohut is distinguishable on several grounds. In the present case, the entire trial was conducted in the fifteenth circuit; it was not moved back and forth between circuits during trial as in Kohut. Moreover, Kohut is arguably no longer good law because, in the interim since it was decided, the legislature has amended sections 910.03 and 26.021 to expand the definition of territorial jurisdiction to include exactly what the trial judge had done in Kohut. See §§ 910.03(3), 26.021(21). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919128/ | 106 B.R. 268 (1989)
In re John Thomas PAPPAS, Debtor.
FEDERAL DEPOSIT INSURANCE CORPORATION, Appellant,
v.
John Thomas PAPPAS, Appellee.
No. C89-0156J.
United States District Court, D. Wyoming.
October 19, 1989.
*269 James R. Belcher and Lawrence J. Wolfe, Holland & Hart, Cheyenne, Wyo., for creditor-appellant.
Ken McCartney, Cheyenne, Wyo. and Patrick J. Murphy, Casper, Wyo., for debtor.
MEMORANDUM OPINION AND ORDER
ALAN B. JOHNSON, District Judge.
The creditor-appellant Federal Deposit Insurance Corporation (FDIC) appeals from an order of the bankruptcy court entered on April 17, 1989, requiring that the FDIC pay $40 an hour to the debtor-appellee John Thomas Pappas for the time he spends cooperating with his malpractice carrier's attorney. The FDIC is suing Pappas for legal malpractice in connection with legal advice he provided to the Yellowstone State Bank of Lander, Wyoming. Pappas has moved to dismiss the appeal as untimely. Alternatively, he argues the court should affirm the order on the ground that it was within the bankruptcy court's discretion to require the FDIC to compensate him as a condition to obtaining relief from the post-discharge permanent injunction imposed by the Bankruptcy Code, 11 U.S.C. § 524.
Pappas, as an attorney, was a shareholder in and general counsel for the Yellowstone State Bank, which failed on November 1, 1985. The FDIC was then appointed receiver. In investigating why the bank failed, the FDIC determined that Pappas neglected to inform the bank that certain "insider" loans, which later became uncollectable, violated applicable banking laws. The FDIC alleges that the uncollectability of these insider loans was a major reason for the bank's failure, causing the bank to lose several million dollars.
The debtor filed a petition for Chapter 11 bankruptcy on March 14, 1986. The court approved the debtor's Chapter 11 reorganization plan and granted a discharge to him one year later on March 28, 1987. The discharge operated to dissolve the automatic stay and replaced it with the Bankruptcy Code's post-discharge permanent injunction. 11 U.S.C. § 362 and § 524(a)(2)
To establish legal malpractice liability against Pappas for the purpose of attaining recovery from his malpractice insurance policy, the FDIC moved to modify the permanent injunction imposed by 11 U.S.C. § 524. In granting the motion on November 12, 1987, the bankruptcy court allowed the FDIC to seek judgment against Pappas for the purpose of enforcing it only against his insurance carrier. In its order, however, the court required the FDIC to indemnify Pappas for his actual costs and expenses incurred in the litigation.
After commencement of the FDIC's lawsuit in state court against him, Pappas moved the bankruptcy court for an order requiring that the FDIC also compensate him, as an attorney fee, for his time actually spent cooperating with his malpractice insurance carrier in defending the FDIC's lawsuit. The bankruptcy court partially granted the motion in order that the FDIC compensate the debtor at the rate of $40 an hour for time spent in defending the FDIC's lawsuit. The FDIC now seeks reversal of that order on the ground that the bankruptcy court erred as a matter of law in ordering the FDIC to compensate the debtor for his time.
As a preliminary matter going to this court's jurisdiction, the debtor argues that the appeal should be dismissed as untimely because the appellant's time to appeal began to run on November 10, 1987, when the bankruptcy court entered its first order modifying the injunction and requiring the FDIC to indemnify the debtor for his costs and expenses. A notice of appeal must be filed within ten days of the date of the entry of the judgment from which an appeal is taken. Fed.Bankr.R. 8002. Although the November 10, 1987, order did not require the FDIC to reimburse the debtor for his time expended in connection with the litigation, the debtor nevertheless argues that the time to file a notice of appeal began to run on this issue because it was foreseeable that costs and expenses would include his time expended on the FDIC litigation.
*270 The November 10, 1987, order provides in relevant part "that the FDIC must indemnify the debtor from all costs and expenses, including attorney's fees, which the debtor incurs as a result of commencement and prosecution of such suit, to the extent that those costs and expenses are not the responsibility of the debtor's insurance carrier. . . ." However, the April 17, 1989, Order from which the FDIC appeals, provides in relevant part as follows: "FDIC shall reimburse the debtor for all of his time reasonably spent in connection with the FDIC v. Pappas lawsuit. . . . at a rate of $40 an hour together with all actual necessary expenses incurred by the debtor. . . ." In reading these two orders, the court finds that the first one required the FDIC to reimburse the debtor for money he spent or became obligated to pay in connection with the FDIC litigation. The second order required the FDIC to pay the debtor for time he expended in connection with the same litigation. Compensation for time spent was regarded as an attorney's fee as opposed to costs and expenses incurred. The orders are therefore distinct in that the expenses refer to either money spent or debt incurred, while attorney's fees refer to compensation for time spent. The bankruptcy court recognized the distinction when it stated in the second order "the FDIC shall reimburse the debtor for all of his time . . . together with all actual necessary expenses incurred. . . ."
The FDIC did not appeal the first order because it agreed to pay the debtor for his out of pocket expenses incurred in connection with its litigation. It objected, however, to having to pay the debtor for his time, which it was required to do under the April 17, 1989, order. The first order protected the debtor's assets while the second one required the FDIC to create assets by paying the debtor for his time. In this appeal, the FDIC is asking the court to rule that time is not property protected by the code, something the FDIC could not have done but for the second order. The court finds that the FDIC's appeal of that second order is therefore timely.
The FDIC filed suit in state court in an effort to establish that the debtor committed legal malpractice. If successful, the FDIC will enforce its judgment only against the debtor's insurance carrier. A discharge in bankruptcy operates as a permanent injunction against the commencement of a lawsuit to recover a pre-petition debt from the debtor. 11 U.S.C. § 524(a)(2). The injunction protects the debtor's property, which is broadly defined by the Bankruptcy Code. See 11 U.S.C. § 541. As correctly noted by the bankruptcy court this injunction does not necessarily bar a creditor from naming the debtor as a defendant in the lawsuit for the purpose of establishing the liability of a third person, such as the debtor's insurance carrier. See Foust v. Munson Steamship Lines, 299 U.S. 77, 84, 57 S. Ct. 90, 94, 81 L. Ed. 49 (1936) (holding that the automatic stay, which provides greater protection than the discharge injunction, does not bar a suit where the debtor is named only to establish the liability of a debtor's insurance carrier). Because the discharge injunction protects the debtor's property, the protection necessary to effectuate the Bankruptcy Code's policy of fresh start, the court, in granting the FDIC's motion to modify, properly exercised its discretion when it ordered the FDIC to indemnify the debtor for his costs and expenses incurred in the litigation. See 11 U.S.C. § 105(a) ("the court may issue any order . . . that is necessary . . . to carry out the provisions of the" Bankruptcy Code).
From this, the debtor argues that the court also exercised its discretion when it ordered that the FDIC compensate him for time spent on the litigation. According to the debtor, the court's order helps protect his fresh start and was therefore within the court's discretion. The debtor's argument, however, misconstrues the concept of fresh start, which is to ensure protection of the debtor's assets from execution to satisfy prepetition debt. The bankruptcy court ensured this protection and therefore respected the debtor's fresh start when it ordered that the FDIC reimburse the debtor his cost and expenses incurred in the litigation.
*271 As the debtor recognizes, the FDIC may proceed against him provided three conditions are met: (1) Where it is necessary to join the debtor to establish liability against a third party; (2) a creditor pays the debtor's reasonable costs of defense, including legal fees and expenses, where those costs and expenses and fees are not borne by a third party; (3) the creditor may not execute on any judgment obtained in the litigation against the debtor personally or against his assets. In re Cantania, 94 B.R. 250, 253 (Bankr.D.Mass.1989); see also In re Mann, 58 B.R. 953, 958 (Bankr. W.D.Va.1986) (if these three conditions are met, "maintenance of the suit does not frustrate the policy of the bankruptcy code in giving the debtor a fresh start in his economic life."). Satisfaction of these conditions guarantee the debtor his fresh start, notwithstanding the litigation against him for a prepetition debt. Id. It is undisputed that the FDIC has satisfied these three conditions. In Wyoming it is necessary to establish the liability of an insured before insurer can be held liable. See generally Morris v. Farmers Ins. Exchange, 771 P.2d 1206 (Wyo.1989); Mountain West Farm Bureau Mutual Ins. Co. v. Hallmark Ins. Co., 561 P.2d 706 (Wyo.1977). The other two conditions are met because the FDIC has already agreed to reimburse the debtor his reasonable costs of defense, including legal fees and expenses and it has agreed not to execute on any judgment it may obtain against Pappas either personally or against his assets.
Notwithstanding satisfaction of these three conditions, the debtor argues that the FDIC should pay him for his time because the lawsuit is consuming so much of his time that he is unable to engage in the practice of law. Without time to practice law, the debtor can have no post-petition earnings, which are, of course, protected by the Bankruptcy Code's fresh start. The bankruptcy court could order the FDIC to pay the debtor for his time only if time, like earnings and other post-petition assets, is in fact an asset.
An asset is anything upon which a creditor can levy. In re Stegall, 865 F.2d 140, 142 (7th Cir.1989) (time is not property because it is not a leviable asset). Time, on the other hand, is not something upon which a creditor may levy and is therefore not an asset protected by the Bankruptcy Code's permanent discharge injunction. See generally Norwest Bank of Worthington v. Ahlers, 485 U.S. 197, 108 S. Ct. 963, 967, 99 L. Ed. 2d 169 (1988) (time is not an asset). Despite this rule, the debtor argues that as a lawyer, time is his earnings and is therefore protected by the Code's fresh start. Of course everyone's time in some sense is one's earnings in that without time we cannot engage in activity that produces earnings. Although the Bankruptcy Code's fresh start policy guarantees protection of one's post-petition earnings, it does not guarantee creation of those earnings. In issuing its first order, the bankruptcy court gave all the protection to which the debtor was entitled: insulation of his post-petition assets, which included earnings realized from his practice of law.[1] In ordering the FDIC to compensate the debtor for his time spent in this litigation, the court in essence is requiring that the FDIC create assets for the debtor, an order that clearly goes beyond the bounds of the concept of fresh start. The court therefore finds that the bankruptcy court erred as a matter of law in requiring that the FDIC compensate the debtor for his time.
Accordingly, IT IS HEREBY ORDERED that the bankruptcy court's April 17, 1989, Order requiring that the FDIC compensate the debtor for his time spent in this litigation, be REVERSED.
NOTES
[1] Evidently the debtor is spending much time responding to numerous discovery requests, including the production of many documents. In this situation, the debtor's remedy would appear to be relief from the state district court, which would have the discretion to require that the FDIC tailor its discovery requests. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919132/ | 106 B.R. 42 (1989)
In re NEW YORK PRODUCE AMERICAN & KOREAN AUCTION CORPORATION, d/b/a A & K Produce, Debtor.
No. 88 B 10197 (BRL).
United States Bankruptcy Court, S.D. New York.
October 5, 1989.
Robert P. Herzog by Robert P. Herzog, New York City, for movants-creditors.
Marc Stuart Goldberg, P.C. by Marc Stuart Goldberg, New York City, Trustee pending resolution of election dispute.
MEMORANDUM DECISION ON MOTION FOR SUMMARY JUDGMENT REGARDING DISPUTED ELECTION CONTROVERSY
BURTON R. LIFLAND, Chief Judge.
BACKGROUND
On January 29, 1988, an involuntary Chapter 7 petition was filed by the Tom Lange Co., Landberg Marketing, Inc. and L & P Fruit Corp. (the "Movants," including L & P Vegetable Corp.) against New York Produce & Korean Auction Corp., d/b/a A & K Produce, the Debtor herein. Inexplicably, the Debtor subsequently filed a voluntary Chapter 11 petition which was dismissed on April 8, 1988. The involuntary *43 petition was converted to Chapter 11 on April 8, 1988.
On June 29, 1989, this Court, for cause, entered an order converting the Debtor's Chapter 11 case to a case under Chapter 7. Soon thereafter, the United States Trustee appointed Marc Stuart Goldberg as interim trustee. Subsequently, based upon this election controversy, Mr. Goldberg is currently acting as the trustee in the case (the "Trustee").
At the first scheduled meeting of creditors, a request for an election of a permanent trustee was made by Robert P. Herzog, Esq. Mr. Herzog presented copies of filed proofs of claims in the following dollar amounts with powers of attorney that run to himself:
A. Tom Lang Company, Inc. $169,490.69
B. Landberg Marketing, Inc. $ 57,792.05
C. L & P Fruit Corp. $ 48,816.00
D. L & P Vegetable Corp. $ 2,472.00
___________
$278,570.74
According to the schedules filed by the Debtor, unsecured debt without priority totaled $348,151.64.
The U.S. Trustee's office was unable to determine whether the claimants who sought to vote for a candidate for trustee held allowable, undisputed, fixed, liquidated claims against this Debtor and do not hold an interest materially adverse to the interest of creditors of this estate pursuant to § 702(a) of the Bankruptcy Code (the "Code"). Although the aforementioned claimants have filed unsecured claims, Mr. Herzog indicated that his clients wished to reserve their Trust beneficiary rights pursuant to the Perishable Agricultural Commodities Act, 7 U.S.C. 499a et seq. ("PACA"). The U.S. Trustee maintained that PACA trust funds are not funds of this estate. Thus the U.S. Trustee asserted that if this Court were to declare that the putative property of this Debtor is not property of the estate, the claimants would not be creditors of this estate. However, if the claimants were to be allowed creditor status, they would be "special creditors" with interests adverse to the interests of other creditors. (See, Report of Election Controversy at ¶ 7(A)).
Pursuant to § 702(a) of the Code, a creditor may vote for a candidate for trustee only if such creditor
(1) holds an allowable, undisputed, fixed, liquidated, unsecured claim of a kind entitled to distribution under section 726(a)(2), 726(a)(3), 726(a)(4), 752(a), 766(h), or 766(i) of this title;
(2) does not have an interest materially adverse, other than an equity interest that is not substantial in relation to such creditor's interest as a creditor, to the interest of creditors entitled to such distribution; and
(3) is not an insider.
Moreover, § 702(b) requires that creditors who wish to elect a permanent trustee must hold at least 20% of the amount of claims specified in subsection (a)(1) of Section 702. Finally, Bankruptcy Rule 2003(b)(3) provides in pertinent part as follows:
Right To Vote. In a chapter 7 liquidation case, a creditor is entitled to vote at a meeting if, at or before the meeting, the creditor has filed a proof of claim or a writing setting forth facts evidencing a right to vote pursuant to § 702(a) of the Code unless objection is made to the claim or the proof of claim is insufficient on its face.
Because of the dispute herein, the U.S. Trustee's office explained to all parties that an election could not be certified pursuant to § 702 of the Code and Bankruptcy Rule 2003, and that a report of election controversy would be prepared and filed with this Court. Mr. Herzog nominated and voted for Philip R. Mann to displace the interim trustee. There were no other requests for an election, and there were no other nominations. The parties who attended the 341 meeting were advised that until such time as a decision is made by this Court regarding this election and the trustee has qualified, the interim trustee will continue to serve as the trustee in this case.
By motion dated August 22, 1989, the Movants, through Mr. Herzog as counsel, applied to resolve the disputed election. Subsequently, on August 23, 1989, the United States Trustee filed with this Court *44 its Report Of Election Controversy pursuant to 28 U.S.C. 586(a)(3) and Bankruptcy Rule X-1006(c). Thereafter, on August 29, 1989, the Trustee filed his response to the Movants' motion for resolution of the disputed election.
Rather than simply participating in their own motion to resolve the election controversy, on September 1, 1989, the losing parties separately moved for summary judgment within the framework of that pending motion. As a result, this Court now has two motions on its docket concerning the same controversy. The prospect of a successful preemptive dispositive separate summary judgment motion was minimal. Nothing prevented the Movants from raising a standing issue at the hearing on their original motion. In this regard, Movants now request an order pursuant to Rule 56 of the Federal Rules of Civil Procedure (the "Federal Rules") and Bankruptcy Rule 7056, for judgment summarily dismissing the Report of Disputed Election on the ground that an interim trustee lacks standing, constitutionally and statutorily[1]; that Movants lack any interest materially adverse to the Debtor's estate; and directing the entry of an order confirming the election of Philip R. Mann as the trustee in bankruptcy of the Debtor, elected as such in accordance with the applicable provisions of the Code.
Movants allege in their Statement pursuant to Local Bankruptcy Rule 13(h) (the "13(h) Statement") that in addition to being general unsecured creditors of the Debtor, Movants "also enjoy a statutorily conferred status under 7 U.S.C. 499e(a) to (c) as cestui que beneficiaries of accounts receivable or the proceeds thereof arising out of the Debtor's sale of perishable agricultural commodities." (Movant's 13(h) Statement at ¶ 9). Movants allege that the schedules of the Debtor filed herein allege under oath that no property in the nature of accounts receivables are owned or held by the Debtor. Thus, Movants maintain that no PACA related accounts receivables exist and therefore, Movants do not hold or have any materially adverse interests to the Debtor's estate. Movants allege that the only filed claims against the Debtor found in the records of this Court on August 21, 1989, other than those of the movants, are four priority claims of Governmental entities. Moreover, Movants allege that they hold allowable, undisputed, fixed, liquidated and unsecured claims of a kind entitled to distribution as provided in § 702(a)(1) of the Code. They allege that their claims are not subject to dispute and the interest and claims of the Movants are not materially adverse to the estate. The Movants also maintain that they are creditors of the estate holding at least 20% in amount of the total claims as are entitled to vote and elect a trustee under the Code. Finally, Movants argue that the only objection to the election of Philip R. Mann was interposed by the Trustee who is without an actual or threatened injury of any kind and accordingly lacks standing, both "constitutionally and statutorily", to contest or object to the claims and the election of a successor trustee. Id. at ¶¶ 10-17.
In contrast, the Trustee states that the objections asserted to the trustee election are both those of the Office of the United States Trustee, (See, Report of Election Controversy), and himself, both parties in interest. The Trustee asserts reactively that both he and the U.S. Trustee enjoy standing constitutionally and statutorily to contest or object to the claims of Movants and the election of a successor trustee. It should be noted that Movants have not *45 raised the issue of the U.S. Trustee's Office to contest or object to the election.
Moreover, the Trustee asserts that representative of the conflict between Movants and the general unsecured population of the Debtor is the litigation commenced by three of the four Movants (exclusive of L & P Vegetable Corporation), together with Calhoon Farms Packing, Inc. against Korean Commercial Bank, the alleged secured creditor of the estate and Edward Kim, its principal. That action, commenced in the U.S. District Court for the Southern District of New York on August 1, 1988, subsequent to the involuntary filing herein alleges, inter alia, that by reason of their status as PACA creditors, the plaintiffs in that action are entitled to proceed against all of Kim's assets as well as Korean Commercial Bank's assets to the extent that those assets were Debtor's accounts receivable or the proceeds therefrom. Consequently, the Trustee asserts that this claim asserted by the Movants would disgorge from those unsecured creditors, not enjoying the status of PACA creditors, the benefits which might otherwise be recoverable and enjoyed by creditors of the estate pursuant to Chapter 5 of the Code. The Trustee further asserts that such a "constructive trust" claim would have the direct impact of segregating for the PACA claimants only, those funds which might otherwise be reachable by a trustee of the estate. Thus, it appears that the Trustee and the PACA creditors have competing interest in assets either in the possession of the Debtor or which have been disposed of in favor of the Korean Commercial Bank, Edward Kim or others. In view of the aforementioned assertions, the Trustee argues that the Movants are adverse to the interests of unsecured creditors and therefore do not enjoy the right to vote for a trustee pursuant to § 702 of the Code. Furthermore, the Trustee maintains in his 13(h) Statement that there are material facts to which there exist genuine issues to be tried as to whether the Movants hold and/have interests materially adverse to the estate; whether the Movants hold allowable, undisputed, fixed, liquidated and unsecured claims of a kind entitled to distribution as provided in § 701(a)(1) of the Code; whether the Movants' claims are subject to dispute and whether the claims are materially adverse to the estate; and whether the Movants are creditors of the estate holding at least 20% in amount of the total claims entitled to vote and to elect a trustee under the Code. (See Trustee's 13(h) Statement). Thus, the Trustee requests that Movants' motion for summary judgment be denied as there are material issues of fact to be determined and that the Trustee be authorized to engage in discovery respecting the claims of Movants.
ISSUES
1) Whether an interim trustee has standing under the Code to object to creditor's voting claims in a election; and
2) Whether the Movants' claims are subject to dispute and whether the claims are materially adverse to the estate.
DISCUSSION
1) Whether an interim trustee has standing under the Code to object to creditor's voting claims in a election.
Although Movants do not question the standing of the U.S. Trustee to contest the election of a successor trustee, since the Trustee's 13(h) Statement raises the issue, the matter must be addressed. It cannot be disputed that the U.S. Trustee has standing to contest or object to the election of a successor trustee. "The U.S. Trustee in the exercise of his administrative duties should not be compelled to certify the election of a proposed trustee where there is sufficient concern for the full administration of the estate in the best interests of creditors." In re Kam Kuo Seafood Corp., 42 B.R. 558, 560 (Bankr.S.D.N. Y.1984).
The election of a permanent Chapter 7 Trustee is governed by § 702(a) of the Code and Bankruptcy Rule 2003(b)(3). However, neither one addresses the issues of who has standing to object to the results of an election. In re NNLC Corp. 96 B.R. 7, 9 (Bankr.D.Conn.1989). Since the U.S. Trustee was unable to certify the election *46 based upon its own uncertainty with respect to Movants' eligibility to vote pursuant to § 702(a)(1) of the Code, the issue as to whether an interim trustee has standing to contest or object to an election may perhaps be moot. However, in view of the fact that the Trustee's objection raises issues not dealt with in the U.S. Trustee's Report of Election Controversy, the matter of whether his appointee, the interim trustee, has standing in this instance must nevertheless be addressed.
Movants, relying on Warth v. Seldin, 422 U.S. 490, 95 S. Ct. 2197, 45 L. Ed. 2d 343 (1975), argue "that in order to have standing a party must always have suffered a distinct and culpable injury to himself that is likely to be redressed if the relief is granted." (Movants' Memorandum of Law at 2.) Further, Movants maintain that "[w]here a person's claim rests on a statutory provision, the standing question is whether such provision can properly be understood as granting persons in the party's position a right to judicial relief." Id. Movants assert that two cases which conclude that an interim trustee has standing to raise objections fail to review in depth or to consider at length the legislative history relating to the status of interim trustees. See, In re Metro Shippers, Inc., 63 B.R. 593 (Bankr.E.D.Pa.1986); In re Poage, 92 B.R. 659 (Bankr.N.D.Tex.1988). Contra, In re G.I.C. Gov't Sec., Inc., 56 B.R. 105 (Bankr.M.D.Fla.1985). Thus, relying on the legislative history of the Code, Movants conclude that since under the Bankruptcy Act a receiver had no standing to object or to participate in an election of a bankruptcy trustee, an interim trustee is similarly limited.
However, Movants overlook a recent decision by Judge Buschman, In re Sandhurst Securities, Inc., 96 B.R. 451 (S.D.N.Y.1989) which, in dealing with the issue of whether a candidate for election to a trusteeship in Chapter 7 has standing to bring on a motion for resolution of election of trustee controversy, adopts the position that an interim trustee does have such standing. Judge Buschman, in holding that a candidate for election lacked standing, stated that "there are significant policy reasons for limiting standing to entities having a stake in bankruptcy case and interim trustees who represent the estate itself." Id. at 457 (citing In re Carla Leather, Inc., 50 B.R. 764, 772 (Bankr.S.D. N.Y.1985)). The court further stated as follows:
Particularly in small estates, [interim trustees] are best able to ascertain initially whether a creditor having a material interest adverse to the estate, 11 U.S.C. § 702(a)(2), or an insider, 11 U.S.C. § 702(a)(3), seeks to vote.
Id.
This Court agrees with this analysis which comports with the more recent line of case holding that an interim trustee has standing to challenge the eligibility of a creditor to vote. See, In re NNLC Corp., 96 B.R. at 9; In re Poage, 92 B.R. 659 (Bankr.N.D.Tex.1988); In re Metro Shippers, Inc., 63 B.R. 593 (Bankr.E.D.Pa. 1986).
"The interim trustee is considered a trustee under title 11 and his appointment is designed to protect the assets of the estate and to insure continuity of administration of the estate before qualification of the regularly elected or designated trustee." 4 Collier On Bankruptcy, § 7.01.01 at 701-02 (15th ed.1988). The interim trustee, an in place fiduciary, "is the optimal party to object to a creditor's claim for voting purposes since he is the representative of the estate and the purpose behind § 702 voting restrictions is to protect the bankruptcy estate." In re NNLC Corp., 96 B.R. at 9 (quoting In re Poage, 92 B.R. at 666).
In the Metro Shippers case, supra, the court held that an interim trustee does have standing based on a different rationale than the NNLC Corp. and the Poage cases, supra. The court in Metro Shippers stated that the interim trustee does have standing because he "has ostensibly lost the opportunity to administer [the case] and with it the possibility to earn commissions. Due process would seem to require that he has standing to challenge any defects in the process by which these rights *47 were lost." Id. at 598. This Court, recognizing from the facts developed here, that other than the interim trustee, there is no other party to the election process positioned to screen potential abuse through estate administration by material adverse interests, therefore, we find correct the rationale of the NNLC Corp. and the Poage courts in holding that an interim trustee does have standing to challenge the eligibility of a party to vote. Indeed, at the argument Movants' Counsel conceded that a court, learning of a possible materially adverse interest from any source, may sua sponte determine the outcome of a trusteeship election. However, without the aid of a fiduciary, such as the interim trustee or other parties in interest, to alert a court of the possibility that a creditor has a material interest adverse to the estate, it would almost be impossible for a court to monitor such elections on its own.
In accordance with the foregoing analysis, this Court holds that the Trustee does have standing to challenge the Movants' eligibility to vote in the election for the appointment of a permanent trustee in the case.
2) Whether the Movants' claims are subject to dispute and whether the claims are materially adverse to the estate.
"The purpose behind the § 702 voting restrictions is to prevent the election of a trustee who will not protect the interest of all the creditors." In re Poage, 92 B.R. at 666; see, In re Ira Haupt & Co., 379 F.2d 884, 892 (2d Cir.1967). "Paramount to consideration of a challenge to the election of a trustee is the welfare of the estate itself." In re Poage, 92 B.R. at 666 (quoting In re Kam Kuo Seafood Corp., 42 B.R. at 560); see also, In re Russo, 18 B.R. 257 (Bankr.E.D.N.Y.1982). Neither the Code nor the Bankruptcy Rules provide a definition of the phrase "interest materially adverse" used in § 702(a)(2). The legislative history, however, indicates that a court is required to balance the competing factors in any specific instance to make its determination. In re NNLC Corp., 96 B.R. at 9-10; see, In re Cohoes Indus. Terminal, Inc., 90 B.R. 67, 70 (S.D.N.Y.1988). See generally, 4 Collier on Bankruptcy ¶ 702.01[2]; see also, H.R.Rep. No. 595, 95th Cong., 1st Sess. 378 (1977), reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5963, 6334; S.Rep. No. 989, 95th Cong., 2d Sess. 92-93 (1978), reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 5878-79. Beyond the legislative history, there are few cases which provide examples of what constitutes an "interest materially adverse". In re NNLC Corp., 96 B.R. at 10. The cases which have addressed the issue as to whether a creditor who has received a preference, for instance, "generally assume that such creditor's interest will be materially adverse to other creditors, provided that the claim of preference is based on more than suspicion." Id. (emphasis added); see, In re Lang Cartage Corp., 20 B.R. 534 (Bankr.E. D.Wis.1982); In re Blesi, 43 B.R. 45, 47 (Bankr.D.Minn.1984); In re Cohoes Indus. Terminal, Inc., 90 B.R. at 70; In re Metro Shippers, Inc., 63 B.R. 593, 598 (Bankr.E. D.Pa.1986). Thus, a standard can be derived from this line of cases that the objections interposed must be more than a suspicion. The In re Poage case, supra, also lends guidance in developing criteria for determining whether a voter is ineligible to vote based on "interest materially adverse" to the estate.
As Rule 3001(f) provides, a properly executed and filed proof of claim is prima facie evidence of the validity and amount of the claim. Such a claim is entitled to vote unless an objection is presented. Bankr.R. 2003(b)(3). If an objection is raised, it is incumbent upon the objecting party to present facts from which the court can reasonably conclude that after a sufficient time for discovery the objecting party could present evidence of equal probative force to that of the creditor's claim. If the objecting party satisfies this burden the claim should be disallowed for voting purposes unless the claimant presents sufficient facts from which the court could reasonably conclude that after a reasonable time for discovery, the claimant could prove the *48 validity and amount of his claim by a preponderance of the evidence.
In re Poage, 92 B.R. at 665.
Based on the aforementioned analysis, in this instance it is clear that the objection interposed by the Trustee goes beyond mere suspicion. The Trustee's submission of several genuine issues of material facts rise to a level sufficient to require denial of Movants' summary judgment motion.
Federal Rule 56 states that summary judgment shall be granted to the moving party if the court determines that "the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 327, 106 S. Ct. 2548, 2555, 91 L. Ed. 2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986); Matsushita Electric Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). Pursuant to Local Bankruptcy Rule 13(h), the party seeking summary judgment is required to set out the material facts as to which no genuine issue exists and the opposing party is required to set out the material facts as to which it is contented that there exists a genuine issue to be tried. "[T]he court `cannot try issues of fact but can only determine whether there are issues of fact to be tried.'" Katz v. Goodyear Tire and Rubber Co., 737 F.2d 238, 244 (2d Cir.1984) (quoting Empire Electronics Co. v. United States, 311 F.2d 175, 179 (2d Cir.1962)); Donahue v. Windsor Locks Bd. of Fire Commissioners, 834 F.2d 54, 58 (2d Cir.1987) (quoting Heyman v. Commerce & Industry Ins. Co., 524 F.2d 1317, 1319-20 (2d Cir.1975)).
This Court therefore finds that there are genuine issues of material fact to be tried as to whether Movants' claims are subject to dispute and whether the claims are materially adverse to the estate. Movants' motion for summary judgment is hereby denied. To the extent that the Movants are desirous of continuing to press their original motion, the Trustee is hereby authorized to engage in discovery respecting the Movants' claims.
It is so Ordered.
NOTES
[1] No specific Article of the Constitution or reference to the constitutionality of any particular statute is mentioned or has been called into question. Nor have Movants cited any authority or even attempted to argue such a proposition in either their papers or at the hearing. Under circumstances where the Constitution is truly called into question, 28 U.S.C. § 2403(a) would be triggered whereby "the court shall certify such fact to the Attorney General, and shall permit the United States to intervene for presentation of evidence . . . and for argument on the question of constitutionality." However, it is clear in this instance that Movants are not seriously raising constitutional issues in their motion but are rather interjecting color into their papers in order to assert that their position has merit. No certification to the Justice Department is warranted under the circumstance. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1547932/ | 153 Pa. Commonwealth Ct. 20 (1993)
620 A.2d 594
PHILADELPHIA HOUSING AUTHORITY
v.
PENNSYLVANIA LABOR RELATIONS BOARD and Philadelphia Housing Police Association;
Appeal of PENNSYLVANIA LABOR RELATIONS BOARD, Appellant.
Commonwealth Court of Pennsylvania.
Argued November 18, 1992.
Decided January 20, 1993.
*21 James L. Crawford, for appellant.
Neal Goldstein and Kenneth M. Jarin, for appellee.
Alaine S. Williams for amici curiae, AFSCME, District Councils 33 and 47, Council 13, AFL-CIO and Philadelphia Federation of Teachers.
Samuel L. Spear for amici curiae AFSCME Local 394, Temple Assoc. of University Professors, Local 4531 and American Federation of Teachers.
Dennis A. Arouca for amici curiae, The Pennsylvania Local Government Conference, et al.
*22 Mark J. Foley, Deputy City Solicitor for amicus curiae, City of Philadelphia and City of Pittsburgh.
Before CRAIG, President Judge, and DOYLE, COLINS, McGINLEY, SMITH, PELLEGRINI and KELLEY, JJ.
DOYLE, Judge.
This is an appeal by the Pennsylvania Labor Relations Board (Board) from an order of the Court of Common Pleas of Philadelphia County which reversed a Board decision holding that the Philadelphia Housing Authority (PHA) had violated Sections 1201(a)(1) and (5) of the Public Employe Relations Act,[1] (Act 195 or PERA) by unilaterally implementing, subsequent to the expiration of the relevant collective bargaining agreement, its final offer tendered during collective bargaining negotiations with the Philadelphia Housing Police Association (Union).
The relevant facts are as follows. The most recent collective bargaining agreement between PHA and the Union expired on March 31, 1990. The parties agreed to extend the contract for thirty days. During the period from March 15, 1990 to June 1, 1990 the parties participated in approximately nine bargaining sessions and also had five meetings with a state mediator. Tentative agreements were reached on some issues during this time period; however, all tentative agreements were conditional upon a complete and final agreement.
On June 1, 1990 PHA made a final offer to the Union. The offer contained all tentative agreements previously agreed upon including, inter alia, a provision pertaining to medical insurance. Under this provision, to be effective August 1, *23 1990, only two HMO plans would have been made available free of charge to Union members; this represented a reduction from four plans previously available to employees on a no cost basis. On June 3, 1990 the Union, at one of its meetings, rejected the entire proposal.
Approximately six weeks later, on July 10, 1990, the Union submitted a counterproposal to PHA. Its counterproposal contained substantial differences from PHA's final offer including wage increases and a suggestion that the collective bargaining agreement be limited to one year in duration rather than three as proposed by the PHA. The Union's counterproposal did not express any objection, however, to the reduction of no-cost HMO's from four to two. That same day PHA rejected the Union's counterproposal. Soon thereafter counsel for PHA wrote separately to the state mediator, on July 12, 1990, and to counsel for the Union, on July 17, 1990, stating the fact that negotiations had been at an impasse for several weeks. He also advised counsel for the Union that PHA would, over the ensuing several weeks, implement its June 1, 1990 proposal including the pension, wage and medical insurance provisions. As of August 1, 1990 PHA did so, while the Union members continued to work.
The Union filed an unfair labor practice charge with the Board alleging that PHA had breached its statutory obligation to bargain in good faith by unilaterally implementing its final offer.[2] The hearing examiner determined that PERA requires that the parties must bargain "to the point of impasse" and he expressed as "the critical inquiry . . . whether the parties reached impasse in their negotiations before the Authority implemented its proposal." He found that the parties had bargained in good faith and that an impasse had been reached adopting the Supreme Court's definition of "impasse" found in Norwin School District v. Belan, 510 Pa. 255, 507 A.2d 373 (1986):
*24 The definition of an "impasse" is that point at which the parties have exhausted the prospects of concluding an agreement and further discussions would be fruitless but its application can be difficult. Given the many factors commonly itemized by the [National Labor Relations] Board and courts in impasse cases, perhaps all that can be said with confidence is that an impasse is a "state of facts in which the parties, despite the best of faith, are simply deadlocked."
Id. at 267 n. 9, 507 A.2d at 380 n. 9 (quoting R.A. Gorman, Basic Text in Labor Law, Unionization and Collective Bargaining, 445-47 (1976) (citations omitted)).[3]
In adopting the definition of impasse in Norwin, the Supreme Court looked to federal labor relations case law which basically envisions a halt to the dispute resolution process due to deadlock. As the term "impasse" is used in public sector law under PERA, however, it can also mean the end of the statutory dispute resolution process, as well as deadlock.[4]*25 Ultimately, the hearing examiner determined, again relying on federal labor relations law, that because the parties had reached an impasse and the HMO provision had been tentatively agreed upon by both sides as early as March 28, 1990, the implementation of the final offer did not violate Section 1201 of PERA.
The hearing examiner reached his decision by fundamentally relying upon Western Newspaper Publishing, 269 NLRB 355 (1984), an opinion which interpreted the National Labor Relations Act. Based on this interpretation of the federal act, he concluded that PHA had fulfilled its bargaining obligations and implemented its final offer only after impasse had been reached and, thus, that no unfair labor practice had been committed.
On November 12, 1991, the Board upheld the hearing examiner's findings including the finding that an impasse existed at the time PHA implemented its final offer, but it rejected the hearing examiner's legal conclusion that there had been no unfair labor practice under Section 1201 of PERA.[5] In so doing the Board opined that the hearing examiner's reliance on federal law was misplaced in this instance because of the important distinctions between public *26 and private sector law. The Board explained its view that two preconditions must exist before an employer bound by PERA may implement a unilateral action: an impasse and cessation of work. Thus, the Board used a different underlying predicate to express the critical inquiry, which we would formulate as: whether the parties had reached impasse in their negotiations under PERA and were the members of the bargaining unit on strike when the Authority unilaterally implemented its proposal.
It is undisputed in this case that only the first of these conditions existed on August 1, 1990.[6] Based on its legal conclusions the Board entered an order that PHA cease and desist from interfering with the rights of Union employees as guaranteed by PERA and cease and desist from refusing to bargain collectively in good faith with the Union. It also directed PHA to rescind the unilateral implementation of its final offer and restore the status quo ante "except insofar as the employees may have received wage and benefit improvements which should not be disturbed" and to make the employees whole for any loss of benefits or wages due to the unilateral action.
Thereafter, PHA appealed to the Court of Common Pleas of Philadelphia County which disagreed with the Board's legal conclusions opining that Pennsylvania case law did not compel the result reached by the Board, and, looking to federal law and the law of other states as persuasive, the lower court reversed the Board. The Board's appeal to this Court followed.
On appeal the Board presents two principal issues for our review. First, it contends that the trial court exceeded its scope of review by impermissibly substituting its judgment for that of the Board. Second, it asserts that PHA violated Section 1201 of PERA by implementing its final offer after a statutory impasse had occurred but in the absence of any Union strike.
*27 Our general scope of review in Board cases where the case goes first to the common pleas court[7] is to determine whether the Board's findings are supported by substantial evidence and whether the conclusions drawn from those findings are reasonable and not illegal, arbitrary or capricious. St. Joseph's Hospital v. Pennsylvania Labor Relations Board, 473 Pa. 101, 373 A.2d 1069 (1977); Abington Transportation Assn. v. Pennsylvania Labor Relations Board, 131 Pa. Commonwealth Ct. 267, 570 A.2d 108 (1990).[8]
Our scope of review is identical to that which the common pleas court must use in its review of the Board's findings. While acknowledging this narrow and limited judicial review, however, the trial court stated that in its view, "the Board misinterpreted and misrelied on the decisions that are factually distinct from the instant case, leading the Board to err in its conclusions of law." The court, therefore, found that the Board had committed errors of law, as distinguished from errors in its findings of fact, and on grounds of public policy reached contrary conclusions to those reached by the Board. The trial court, relying on federal private sector labor law, found that PHA had not committed an unfair labor practice by unilaterally changing the terms and conditions of the expired collective bargaining agreement. In effect, the court substituted its own discretion, formulated on broad grounds of public policy, for that of the Board. This was error because policy considerations are within the Board's expertise and deference to that expertise is required. Appeal *28 of Cumberland Valley School District, 483 Pa. 134, 394 A.2d 946 (1978).
Pennsylvania case law is clear that private-sector federal labor law has only a limited application to PERA cases and should be looked to for guidance only where it has "no meaningful difference in policy" from PERA. Cumberland Valley.[9] As our Supreme Court stated in Pennsylvania Labor Relations Board v. State College Area School District, 461 Pa. 494, 337 A.2d 262 (1975):
Although these [federal] decisions may provide some guidance, we are mindful of the distinctions that necessarily must exist between legislation primarily directed to the private sector and that for public employes. The distinction between the public and private sector cannot be minimized. Employers in the private sector are motivated by the profit to be returned from the enterprise whereas public employers are custodians of public funds and mandated to perform governmental functions as economically and effectively as possible. The employer in the private sector is constrained only by investors who are most concerned with the return for their investment whereas the public employer must adhere to the statutory enactments which control the operation of the enterprise. We emphasize that we are not suggesting that the experience gained in the private sector is of no value here, rather we are stressing that analogies have limited application and the experiences gained in the private employment sector will not necessarily provide an infallible basis for a monolithic model for public employment.
*29 We also recognize the wisdom of refraining from attempting to fashion broad and general rules that would serve as a panacea. The obviously wiser course is to resolve disputes on a case-by-case basis until we develop, through experience in the area, a sound basis for developing overall principles.
Id. at 499-500, 337 A.2d at 264-65 (footnote omitted) (emphasis added).
Keeping paramount, therefore, the Supreme Court's admonition regarding the distinction between public and private sector law, it is necessary to examine the goal PERA sought to achieve so as to determine for purposes of the legal issue presented here whether PERA has any "meaningful difference in policy" from federal labor relations law. Cumberland Valley. Section 101 of PERA declares:
The General Assembly of the Commonwealth of Pennsylvania declares that it is the public policy of this Commonwealth and the purpose of this act to promote orderly and constructive relationships between all public employers and their employes subject, however, to the paramount right of the citizens of this Commonwealth to keep inviolate the guarantees for their health, safety and welfare. Unresolved disputes between the public employer and its employes are injurious to the public and the General Assembly is therefore aware that adequate means must be established for minimizing them and providing for their resolution. Within the limitations imposed upon the governmental processes by these rights of the public at large and recognizing that harmonious relationships are required between the public employer and its employes, the General Assembly has determined that the overall policy may best be accomplished by (1) granting to public employes the right to organize and choose freely their representatives; (2) requiring public employers to negotiate and bargain with employe organizations representing public employes and to enter into written agreements evidencing the result of such bargaining; and (3) establishing procedures to provide for the protection of the rights of the public employe, the public employer and the public at large.
*30 To achieve its end, PERA directs mandatory collective bargaining to take place over wages, hours and other terms and conditions of employment, see Section 701 of PERA, 43 P.S. § 1101.701, and, in exchange, most public employees are given a right to strike. That right, however, is greatly curtailed by PERA, no doubt in recognition of the negative impact on the public when government services are not forthcoming.
In considering the distinctions between public and private sector law and the purpose of PERA, it is also useful to examine the purpose of collective bargaining in the federal sector and then to look at the economic weapons normally available to the parties in a private sector labor dispute and compare them with those available under PERA. Initially, we recognize that the purpose of a collective bargaining agreement in private-sector federal law is to assist employees in counteracting an employer's almost complete control over employment concerns. Bowman, An Employer's Unilateral Action An Unfair Labor Practice? 9 Vand.L.Rev. 487, 490 (1956). This purpose is very different from that espoused in PERA. Consequently, in private-sector federal law a strike is recognized as a legitimate and powerful economic weapon available to employees. Its sanctity has been expressly preserved by the National Labor Relations Act, 29 U.S.C. §§ 151-169. See National Labor Relations Board v. Erie Resistor Corp., 373 U.S. 221, 83 S.Ct. 1139, 10 L.Ed.2d 308 (1963). A strike is not precluded during the course of contract negotiations, nor is it viewed as inconsistent with such negotiations. But it is under Section 1002 of PERA, 43 P.S. § 1101-1002.
Under the National Labor Relations Act, strikes are part and parcel of the collective bargaining process. National Labor Relations Board v. Insurance Agents' International Union, 361 U.S. 477, 494-95, 80 S.Ct. 419, 430, 4 L.Ed.2d 454 (1960). Thus, generally speaking, absent a collective bargaining agreement provision containing a no-strike clause, see Boys Markets, Inc. v. Retail Clerks Union, Local 770, 398 U.S. 235, 90 S.Ct. 1583, 26 L.Ed.2d 199 (1970), or a situation where a strike will affect an entire industry or a substantial *31 part thereof and imperil the national health, safety or welfare, see 29 U.S.C. § 178, a strike will not be enjoined.
The unilateral implementation of an employer policy during negotiations (which can be viewed as employer's economic weapon) however, is generally prohibited in private-sector federal law, because it is viewed as inconsistent with good faith negotiation. National Labor Relations Board v. Katz, 369 U.S. 736, 743, 82 S.Ct. 1107, 1111, 8 L.Ed.2d 230 (1962). Thus, absent an impasse (i.e., deadlock) in which the duty to bargain temporarily terminates, unilateral implementation is not permitted. To summarize then, in a private sector labor market, labor's right to strike is jealously guarded and virtually unfettered while management's corresponding right to unilaterally change contract terms is curtailed only moderately, i.e., permitted only after impasse. Thus, there is an effort to afford the parties some balance in the economic weapons available to them.
In contrast to the private sector endorsement of strikes, however, public sector law in Pennsylvania has traditionally not recognized such a right. While PERA now recognizes such a right for most public employees, the right to strike is much more circumscribed than under federal law. Strikes can be implemented only when statutorily prescribed impasse procedures are exhausted, see 43 P.S. §§ 1101.1002-1101.1003, and can be enjoined where they create a "clear and present danger or threat to the health, safety or welfare of the public." 43 P.S. § 1101.1003. Thus, the right to strike under PERA is far more limited than under federal private sector law.
When one recognizes that the employer's counter-balancing economic weapon, a unilateral implementation, is circumscribed in situations where a broad right to strike is recognized, how much more cogently should it follow that it should be no less circumscribed where strike rights are much more limited. And that brings us to the question now facing us. Is the use of such an employer weapon where a statutory impasse has been reached, but no strike has ensued, a violation of Section 1201 of PERA?
*32 As all parties and amici agree (or concede) there is no express authority in PERA for unilateral implementation after an impasse has occurred.[10] And, we believe that to infer that such a major substantive provision exists in the "penumbra" of PERA would be the height of judicial legislation. Consequently, if public employers feel they need more economic weapons in their arsenal, it is to the legislature that they must turn.
Further, and above all other considerations, we cannot conclude under St. Joseph's that the Board, the acknowledged expert in this area reached an unreasonable conclusion when it opined:
In our view, it would not serve the legislature's declared goal of promoting orderly and constructive relationships between public employers and their employes through good faith collective bargaining to allow a public employer to implement its final offer when the employes in the unit have not disrupted the continuation of public services by striking. Unilateral action by an employer during a period of no contract while employes continue to work serves to polarize the process and would encourage strikes by employes who otherwise may wish to continue working under the terms of the expired agreement while negotiations continue.
We believe that a public employer is less likely to negotiate in good faith with a sincere desire to reach mutual agreement if it knows that it may implement its final offer after only 21 days of negotiation and 20 days of mediation (assuming that a fact finder is not appointed). Good faith negotiation would be seriously jeopardized by permitting the employer to implement its bargaining position after a few face-to-face bargaining sessions and the requisite number of mediation sessions with the mediator. The employer's unilateral achievement of its bargaining position effectively relieves pressure on it to arrive at a mutually agreed *33 resolution of the bargaining impasse. It is the tension created by the need to find common ground between the parties which is at the core of the process. Relieving that tension greatly removes the incentive of a party to bargain with a sincere desire to reach agreement.
It is abundantly clear that the trial court, in reversing the Board's decision did so on the basis of its own view of what declared public policy under PERA should be. In commenting critically on the Board's interpretation of PERA, as above quoted, the Court opined:
The Board's view fails, however, to take into account the competing interests of public employers, employees and the citizens of the Commonwealth which Act 195 [PERA] seeks to balance.
This oversight renders the Board's decision unreasonable since, by holding that an employee organization is entitled to an indefinite extension of an expired contract so long as it does not strike, the Board upsets the balance built into Act 195 [PERA] by making the interests of public employees paramount.
The trial court then proceeded to explain its own view of public policy by analyzing the present economic conditions facing cities with "ever rising costs and dwindling public funds." But even if the courts' view of the present market-place economy were true, the General Assembly did not enact PERA to be applied solely in an unchanging and stagnate economic climate, and, more to the point, under the trial court's own analysis, exactly the opposite result would occur in a healthy and expanding economic climate, that is, the "balance built into" PERA would then be skewed against the public employees.
We view the essential issue then as which adjudicatory body did the General Assembly invest with the responsibility of interpreting public policy under PERA? On this account we believe that the Supreme Court has made it clear that "[this Court] will not lightly substitute its judgment for that of a body selected for its expertise [the Board] whose experience and expertise make it better qualified than a court of law to *34 weigh facts within its field." Appeal of Cumberland Valley School District, 483 Pa. 134, 139-40, 394 A.2d 946, 949 (1978), quoting Pennsylvania Labor Relations Board v. Butz, 411 Pa. 360, 377, 192 A.2d 707, 716 (1963).
Accordingly, based upon the foregoing discussion, and concluding that the trial court substituted its judgment regarding labor policy for that of the Board, we reverse the order of the court of common pleas and reinstate the Board's order.
ORDER
NOW, January 20, 1993, the order of the Court of Common Pleas of Philadelphia County in the above-captioned matter is hereby reversed and the order of the Pennsylvania Labor Relations Board is reinstated.
SMITH and PELLEGRINI, JJ., concur in the result only.
COLINS, Judge, dissenting.
I must respectfully dissent from the eloquent and well-researched opinion of Judge Doyle for two reasons.
First, I disagree that the General Assembly has invested the Board with the sole and conclusive authority of interpreting public policy under PERA. This Court and ultimately the Supreme Court are vested with the constitutional authority and responsibility of interpreting the declared public policy intent of any legislation and deciding what parameters shall be placed upon any quasi-judicial body's ability to interpret legislation applicable to all citizens of the Commonwealth. In Metropolitan Property and Liability Insurance Company v. Insurance Commissioner, we stated that "[w]hen the words of a statute are not explicit, this Court must ascertain and effectuate the intention of the General Assembly." 97 Pa. Commonwealth Ct. 219, 222, 509 A.2d 1346, 1348 (1986), affirmed, 517 Pa. 218, 535 A.2d 588 (1987).
Similarly, the United States Supreme Court has observed: "Undoubtedly questions of statutory interpretation, especially when arising in the first instance in judicial proceedings, are for the courts to resolve, giving appropriate weight to the *35 judgment of those whose special duty is to administer the questioned statute." National Labor Relations Board v. Hearst Publications, Inc., 322 U.S. 111, 130-131, 64 S.Ct. 851, 860, 88 L.Ed. 1170 (1944).
In the instant matter, the Board is delegated the exclusive function to decide cases arising under PERA in the first instance. Appeal of Cumberland Valley School District, 483 Pa. 134, 394 A.2d 946 (1978). However, this delegation of authority does not mandate that the courts abdicate their responsibility and authority to interpret PERA. The trial court acted within this authority when it concluded that the Board made errors of law.
Second, the ramifications of the instant opinion create a precedent that compels municipal corporations or authorities to continue to operate indefinitely under expired labor agreements regardless of the financial impossibility of doing so. To compel any municipality to maintain financial commitments in perpetuity in the face of a declining population or a shrinking tax base or any other adverse circumstance, creates a precedent in this Commonwealth which is most dangerous and is contrary to the public interest.
As the majority acknowledges, PERA limits public employees' right to strike in recognition of the negative impact on the public when government services are not forthcoming. This limitation on the right to strike, however, does more than simply protect the public; it achieves a tenuous balance in bargaining power between the public sector employer and public employees. The majority's decision weakens PERA's limitation on public employees' right to strike and accordingly threatens the delicate balance of bargaining power between employer and employee in the public sector.
I would affirm the opinion of the trial court in the instant matter.
KELLEY, J., joins in this dissenting opinion.
NOTES
[1] Act of July 23, 1970, P.L. 563, as amended, 43 P.S. § 1101.1201. This Section reads in pertinent part:
(a) Public employers, their agents or representatives are prohibited from:
(1) Interfering, restraining or coercing employes in the exercise of the rights guaranteed in Article IV of this act.
. . . .
(5) Refusing to bargain collectively in good faith with an employe representative which is the exclusive representative of employes in an appropriate unit, including but not limited to the discussing of grievances with the exclusive representative.
[2] The only specific provision challenged in the unfair labor practice charge was the one dealing with the provision for the HMO medical care coverage. The charge does, however, indicate that other terms and conditions of the recently expired collective bargaining agreement were altered.
[3] Footnote 9 is taken from the opinion announcing the judgment of the Court, affirming the order of the Commonwealth Court at 80 Pa. Commonwealth Ct. 67, 471 A.2d 904 (1984). This opinion, authored by Chief Justice Nix, was joined by Justice Papadakos; Justice Zappala and Justice Larsen concurred in the result, and Justice McDermott and Justice Hutchinson dissented. Justice Flaherty did not participate in the decision. Plurality opinions of the Supreme Court are not binding precedent, LeGare v. Unemployment Compensation Board of Review, 498 Pa. 72, 78 n. 3, 444 A.2d 1151, 1154 n. 3 (1982); 2 Darlington, McKeon, Schuckers & Brown, Pennsylvania Appellate Practice § 3102:2, at 83 (1986), although neither the concurring nor dissenting opinion speaks to a different understanding of when an impasse occurs.
[4] Under Article VIII of PERA, 43 P.S. § 1101.801-1101.806a, if, after a "reasonable period of negotiation, a dispute or impasse exists" the parties "may voluntarily submit to mediation, but if no agreement is reached between the parties within twenty-one days after negotiations have commenced . . . and mediation has not been utilized by the parties, both parties" are to notify the Pennsylvania Bureau of Mediation. See 43 P.S. § 31101.801. PERA further directs that once mediation has commenced it is to continue for as long as the parties have not reached an agreement. If no agreement has been reached 20 days after mediation has begun, but in no event later than 120 days prior to the "budget submission date," the Bureau of Mediation is to notify the Board which may then in its discretion appoint a fact finding panel (not done in this case). The panel is then to submit its recommendations to the Board and the parties must determine whether or not they will accept the recommendations.
This is in contrast to federal labor relations law which has no statutory impasse procedures. A finding of impasse under federal law depends upon (1) the bargaining history of the parties, (2) the good faith of the negotiations, (3) the length of the negotiations, (4) the significance of the issues over which the disagreement exists and (5) the contemporaneous understanding of the parties as to the state of negotiations. See Taft Broadcasting Co., 163 NLRB 475, 64 LRRM 1386 (1967), aff'd sub nom., American Federation of Television and Radio Artists, AFL-CIO, Kansas City Local v. National Labor Relations Board, 395 F.2d 622 (D.C.Cir.1968).
[5] The Board itself is vested with the ultimate authority to determine if there has been an unfair labor practice. 43 P.S. § 1101.1301. However all formal hearings are conducted by a hearing examiner designated by the Board, 34 Pa. Code § 95.91, whose proposed decision to the Board will become final if no exceptions are filed within twenty days, 34 Pa. Code § 95.95(b), or unless the Board itself on its own motion determines to review the proposed decision, 34 Pa. Code § 95.98(d). In this case the Union filed exceptions to the hearing officer's proposed decision and order with the Board.
[6] In fact, it appears no strike has ever occurred.
[7] Commonwealth Court has direct appellate jurisdiction over appeals from the Pennsylvania Labor Relations Board where charges are filed under Act 111, the Act of June 24, 1968, P.L. 237, 43 P.S. §§ 217.1 217.10, and appeals filed under PERA/Act 195 which involve Commonwealth employees; all other appeals under PERA are first filed with the courts of common pleas. 42 Pa.C.S. §§ 763, 933. See also Delaware County Lodge No. 27 v. Pennsylvania Labor Relations Board, 497 Pa. 319, 440 A.2d 512 (1982).
[8] See also Harbaugh v. Pennsylvania Labor Relations Board, 107 Pa. Commonwealth Ct. 406, 411 n. 2, 528 A.2d 1024, 1026 n. 2 (1987) (declining to apply the standard set forth in Estate of McGovern v. State Employees' Retirement Board, 512 Pa. 377, 517 A.2d 523 (1986), to cases appealed first to the common pleas court).
[9] In Cumberland Valley the collective bargaining agreement had expired on June 30, 1975 and immediately thereafter, while the collective bargaining was in process, the employer school district terminated benefits for the life and health insurance plans which the district had been obligated to provide under the expired agreement. The Supreme Court held that, in that situation, there was no meaningful difference in policy between the National Labor Relations Act and PERA, relying primarily on National Labor Relations Board decisions and federal case law. The Court sustained the decision of the Board that the school district had committed an unfair labor practice, quoting from Pennsylvania Labor Relations Board v. Butz, 411 Pa. 360, 377, 192 A.2d 707, 716 (1963).
[10] PHA contends that unilateral implementation is an inherent managerial prerogative whose viability was unaltered by PERA. See State College. We disagree that it remains unaltered because to so rule would seriously undermine the bargaining power PERA granted to public employees. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1592859/ | 453 So.2d 635 (1984)
Steven Wesley PEERY, Sr.
v.
Maria Laticia Molina PEERY.
No. 16594-CW.
Court of Appeal of Louisiana, Second Circuit.
June 28, 1984.
Rehearing Denied July 6, 1984.
*636 James E. Franklin, Shreveport, for plaintiff-applicant.
Booth, Lockard, Politz, LeSage & D'Anna by Nyle A. Politz, Shreveport, for appellee.
Before MARVIN, FRED W. JONES and NORRIS, JJ.
PER CURIAM.
In this custody proceeding we granted a stay order and ordered portions of the record to facilitate our consideration of the application of the father for a discretionary review of the trial court's judgment sustaining an exception of res judicata and declining to exercise jurisdiction under the *637 Uniform Child Custody Jurisdiction Act (UCCJA), La.R.S. 13:1700 et seq. We reverse in part and remand with instructions.
Factual Context
The parents were married in California and shortly thereafter moved to Louisiana in 1977. Their child was born in Shreveport on November 13, 1978. About July 5, 1982, the mother left the father and moved with the child to California, the home of the mother.
In the mother's action for an interlocutory decree of divorce and custody in California, the father was personally served while visiting there in December of 1982. The judgment in that action was signed by the attorneys of both parties to the dispute on February 14, 1983.
About March 2, 1983, the mother and child returned to Louisiana and resumed living with the father until July 9, 1983. On July 9, 1983 the mother and child returned to California.
On July 22, 1983 the father brought an action in Louisiana for custody and legal separation. The mother was served through a curator and was informed by him of the action by his letter to her of July 28, 1983. However, the father did not comply with La.R.S. 13:1708[1] when he filed his petition, but verbally informed the Louisiana court of the California custody decree and introduced that decree into evidence. The judgment of the Louisiana court, dated September 19, 1983, granted the father a legal separation and awarded him custody of the child.
In September of 1983 the father went to California armed with his Louisiana judgment. The father and child then returned to Shreveport on or about September 23, 1983, where they have since resided.
Approximately one month later, the mother petitioned the California court to make the interlocutory divorce decree final and to have permanent custody of the child awarded to her. The father entered an appearance in that proceeding, asserting that the cohabitation from March to July of 1983 amounted to a reconciliation of the parties. On December 1, 1983 the California court rendered a judgment granting final divorce and holding that the cohabitation of the parties did not constitute a reconciliation and that the court had and continues to have jurisdiction of the parties. The California court then ordered the father to deliver the child to the mother.
On March 27, 1984 the father petitioned for a final divorce and for permanent custody in the Louisiana court, again failing to comply with La.R.S. 13:1708. The mother appeared in the Louisiana action, filing a peremptory exception of res judicata, pleading the California final divorce and custody decree.
The Louisiana court sustained the mother's exception of res judicata on May 31, 1984. The mother then filed a habeas corpus action, which, after a hearing on June 5 and 6, ordered the father to surrender custody *638 of the child to the mother. The father seeks this court's supervisory review of those rulings, each of which raises jurisdictional questions. We stayed the proceedings to consider these questions.
JURISDICTION and the UCCJA
The UCCJA, now adopted by 49 states, was promulgated for the stated purpose of avoiding jurisdictional competition in conflicts, promoting interstate cooperation, litigating custody where child and family have closest connections, discouraging continuing conflict over custody, deterring abduction and unilateral removal of children, avoiding relitigation in another state's custody decisions, and promoting exchange of information and other mutual assistance between courts in different states. See La.R.S. 13:1700.
The courts of California and Louisiana had the constitutional jurisdiction over the parties, but the issue of which court had proper authority to exercise its jurisdiction under the UCCJA limitations remains to be determined. The "jurisdictional" grounds under UCCJA for child custody determination are set out in the Louisiana statutes at La.R.S. 13:1702 and in the California statutes in Cal.Civil Code, §§ 5152 et seq. These statutes, adopted under the uniform act, are identical.
Other sections of the act that follow address the due process rights of the parties and prescribe appropriate procedures. Crucial to our determination are those sections which articulate the circumstances or situations in which the courts may and should decline to exercise jurisdiction. We stress this point because the parties speak of either California or Louisiana as lacking "jurisdiction" to act in the instant matter, when the more accurate inquiry is whether the UCCJA directs or allows the exercise of jurisdiction. Each state may assert jurisdiction under the multi-faceted components of Section 1702. Indeed, this case illustrates the jurisdictional competition and conflict which the UCCJA was designed to alleviate.
Consistent with the goal of avoiding, in this state, relitigation of custody decisions of other states, R.S. 13:1712 provides that the courts of this state shall recognize and enforce an initial or modification decree of a court of another state which has the same jurisdiction under statutory provisions that are substantially in accordance with Section 1702, or which was made under factual circumstances meeting the jurisdictional standards of Section 1702.[2]
*639 La.R.S. 13:1713 authorizes Louisiana to modify an out-of-state decree. Section 1713 provides as follows:
A. If a court of another state has made a custody decree, a court of this state shall not modify that decree unless it appears to the court of this state that the court which rendered the decree does not now have jurisdiction under jurisdictional prerequisites substantially in accordance with this Part or has declined to assume jurisdiction to modify the decree and the court of this state has jurisdiction.
B. If a court of this state is authorized under Subsection A of this Section and Section 1707 to modify a custody decree of another state it shall give due consideration to the transcript of the record and other documents of all previous proceedings submitted to it in accordance with Section 1721.
The threshold question is whether California, which rendered the initial decree, had jurisdiction, or now has jurisdiction, under the peculiar jurisdictional prerequisites of the UCCJA, which are set forth in Subsections A(1) and (2) of Section 1702 of our law, quoted in footnote two.
About July 5, 1982, the mother left Shreveport with the child and began residing in California with her family. The record also reflects that the proceedings for an interlocutory decree of divorce and custody in California began on December 22, 1982, a period of approximately 5 ½ months. The record also reflects that the child previously resided all of his life in Shreveport with his parents. Additionally, it is undisputed that Shreveport was the only place of matrimonial domicile of the parents.
Under these circumstances, the California court lacked jurisdiction under UCCJA because it was not the home state of the child and did not have the significant connection with the child. Specifically, California failed to meet the home state requirement of the home state test because the child did not reside within the state for six consecutive months before the action was instituted.
Under the significant connection test, there must be available substantial evidence concerning the child's present or future care, protection, training, and personal relationship. The record clearly shows that the child has lived the great majority of his life in Louisiana and that substantial evidence concerning the child is available in Louisiana.
The validity of the initial Louisiana custody decree under UCCJA is also questionable. The father filed his action in Louisiana in July of 1983. On September 19, 1983, the Louisiana court awarded custody to the father.
The father did not fully comply with the UCCJA. The father failed in his first pleading to inform the court of the custody proceedings pending in the California court. Section 1708. The purpose of this section seeks to avoid conflicting child custody determinations from courts of different states. The record does reflect that the father verbally informed the Louisiana court of the California decree when the trial on his separation petition occurred. It appears that the Louisiana court improperly found that there were no simultaneous proceedings for custody pending in any other state. When the court was informed of the California proceedings, the Louisiana court should have proceeded as directed by Section 1705. This section provides for situations where proceedings may occur simultaneously in two or more states. The initial Louisiana decree, like the California initial decree, did not strictly comply with the apparent "jurisdictional" prerequisites of UCCJA.
The fact of non-compliance with UCCJA does not affect, however, the jurisdiction of the California court or the Louisiana *640 court to adjudicate the status of the marriage of the mother and father. The California divorce, rendered December 1, 1983, has become final. The Louisiana father personally appeared in that action. Under these circumstances, the trial court did not err in sustaining the mother's exception of res judicata directed at the father's 1984 action for a divorce in Louisiana. Brown v. Brown, 387 So.2d 565 (La. 1980).
Non-compliance with UCCJA should limit, however, the authority of courts in Louisiana and in California to render or to modify a custody decree in these circumstances. While this case illustrates the conflicts problem UCCJA seeks to resolve, this case is not typical because the father did not "snatch" the child from the mother and abscond with him to Louisiana from California. The record clearly shows that the father and the mother discussed and compared the initial California decree and the initial Louisiana decree with the police authorities in California before the father returned here with the child on September 23, 1983. The father did not use the guise of "visitation" to flee with the child. Any finding to the contrary by the trial court is clearly wrong.
This child lived in Louisiana the first three years and eight months of his life. He lived eight months in California (July 5, 1982March 2, 1983). Since March 2, 1983, with the exception of 2½ months (July 9September 22), he has lived in Louisiana, either with both parents or with his father. Yet it appears that paramount "best interest of the child," the UCCJA standard, has not been determined in a true adversary proceeding which complies with UCCJA.
Louisiana has jurisdiction under the home state provision and under the significant connection provision of UCCJA (LRS 13:1702 A(1) and (2)). The parents and the child are in Shreveport, Louisiana. Under these circumstances, we shall find that neither California nor Louisiana has previously complied with UCCJA and we shall reverse the trial court's judgment ordering surrender of the child to the mother by the father. We shall further direct that the parties and the trial court comply with UCCJA to exercise its jurisdiction and proceed in an adversary hearing to determine custody in the best interest of the child.
The trial court shall fully inform the California forum that it will exercise its jurisdiction to determine custody in accord with the provisions of UCCJA, LRS 13:1713(B). Due consideration shall be given to the transcript of record and other documents in all previous proceedings as authorized by LRS 13:1721. The trial court shall request from the California forum the documents and transcripts mentioned in LRS 13:1720, 1721, and shall utilize, where appropriate, the provisions of LRS 13:1717-1719 in order that the best interests of the child might be determined in an adversary hearing that complies with UCCJA. The trial court shall consult with the California forum and shall require the assistance of the litigants to insure compliance with UCCJA. Each litigant shall be allowed a reasonable time to amend his or her pleadings to limit the issues and to provide for an expeditious and efficient proceeding.
Costs, here and below, shall be assessed by the trial court in its discretion under the law, when and as often as the trial court deems proper after remand. The trial court may render other temporary orders as it deems necessary to facilitate the hearing and to allow the exercise of reasonable parental rights by each parent during the pendency of the hearing.
Writ granted and made peremptory. Affirmed in part, reversed in part, and remanded with instructions.
NOTES
[1] R.S. 13:1708.
A. Every party in a custody proceeding in his first pleading or in an affidavit attached to that pleading shall give information under oath as to the child's present address, the places where the child has lived within the last five years, and the names and present addresses of the persons with whom the child has lived during that period. In this pleading or affidavit every party shall further declare under oath whether:
(1) He has participated (as a party, witness, or in any other capacity) in any other litigation concerning the custody of the same child in this or any other state.
(2) He has information of any custody proceeding concerning the child pending in a court of this or any other state, and
(3) He knows of any person not a party to the proceedings who has physical custody of the child or claims to have custody or visitation rights with respect to the child.
B. If the declaration as to any of the above items is in the affirmative the declarant shall give additional information under oath as required by the court. The court may examine the parties under oath as to details of the information furnished and as to other matters pertinent to the court's jurisdiction and the disposition of the case.
C. Each party has a continuing duty to inform the court of any custody proceeding concerning the child in this or any other state of which he obtained information during this proceeding.
[2] R.S. 13:1702.
A. A court of this state which is competent to decide child custody matters has jurisdiction to make a child custody determination by initial or modification decree if:
(1) This state (i) is the home state of the child at the time of commencement of the proceeding, or (ii) had been the child's home state within six months before commencement of the proceeding and the child is absent from this state because of his removal or retention by a person claiming his custody or for other reasons, and a parent or person acting as parent continues to live in this state; or
(2) It is in the best interest of the child that a court of this state assume jurisdiction because (i) the child and his parents, or the child and at least one contestant, have a significant connection with this state, and (ii) there is available in this state substantial evidence concerning the child's present or future care, protection, training, and personal relationship; or
(3) The child is physically present in this state and (i) the child has been abandoned or (ii) it is necessary in an emergency to protect the child because he has been subjected to or threatened with mistreatment or abuse or is otherwise neglected or dependent; or
(4)(i) It appears that no other state would have jurisdiction under prerequisites substantially in accordance with Paragraphs (1), (2), or (3), or another state has declined to exercise jurisdiction on the ground that this state is the more appropriate forum to determine the custody of the child, and (ii) it is in the best interest of the child that this court assume jurisdiction.
B. Except under Paragraphs (3) and (4) of Subsection A, physical presence in this state of the child, or of the child and one of the contestants, is not alone sufficient to confer jurisdiction on a court of this state to make a child custody determination.
C. Physical presence of the child, while desirable, is not a prerequisite for jurisdiction to determine his custody.
"Home state" means the state in which the child immediately preceding the time involved lived with his parents, a parent, or a person acting as parent, for at least six consecutive months, and in the case of a child less than six months old the state in which the child lived from birth with any of the persons mentioned. Periods of temporary absence of any of the named persons are counted as part of the six-month or other period. (LRS 13:1701(5)) | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919086/ | 912 So.2d 101 (2005)
MID-SOUTH ANALYTICAL LABS, INC., Plaintiff-Appellant
v.
JONES, ODOM, SPRUILL & DAVIS, LLP, Defendant-Appellee.
No. 40,089-CA.
Court of Appeal of Louisiana, Second Circuit.
September 23, 2005.
*102 Francis M. Gowen, Jr., Shreveport, for Appellant.
Jones, Odom, Davis & Politz, L.L.P., by Nyle A. Politz, James W. Davis, Shreveport, for Appellee.
Before CARAWAY, DREW and MOORE, JJ.
MOORE, J.
This is an appeal from the grant of a motion for partial summary judgment arising out of a suit for fees for analytical (soil testing) and consulting services. Mid-South Analytical Labs, Inc. (hereinafter *103 "Mid-South" or "plaintiff"), appeals the judgment of the trial court holding that $93,354.33 of its claim for payment for "professional services" fees and all $28,403.50 of its claim for payment for analytical services that it provided to the law firm of Jones, Odom, Spruill and Davis has prescribed. Jones, Odom, Spruill, and Davis (hereinafter "Jones-Odom" or "defendant") answered the appeal alleging that the trial court erred in denying that part of its motion for partial summary judgment that would limit the amount of any Mid-South recovery to $6,645.67 based upon an alleged agreement that Mid-South's consulting fees would not exceed $100,000, and in denying that part of its motion seeking dismissal of Mid-South's claim for attorney fees. For the following reasons, we reverse the judgment of the trial court in part, and remand for further proceedings in accordance herewith.
FACTS
The dispute in this case arose when the Jones-Odom law firm did not pay Mid-South for soil testing and consulting services it provided to Jones-Odom as its expert in the class action case captioned May v. Texaco, Inc. and Bank One.[1] Jones-Odom represented various claimants in the above suit for damages arising from alleged soil contamination caused from Texaco's refinery operations many years earlier on property that is now the Anderson Island subdivision in Shreveport. Mid-South was engaged to take soil samples in the area of concern, perform tests, evaluate the results, and consult with Jones-Odom regarding the case. Jones-Odom contends that most of the testing and professional services were performed between the period from July 19, 1997 and July 24, 1998; however, Mid-South contends there was additional work performed all the way into mid-January of 1999.
There was no written agreement between Mid-South and Jones-Odom, nor is there a record of testimony regarding the terms of the agreement. Mid-South billed Jones-Odom for the first time in April of 1999 when Larry Lott, the president and CEO of Mid-South, sent a letter dated April 23, 1999 to Jones-Odom along with a "Cost Summary for the Anderson Island Project" containing various invoices for all the analytical testing to date, and also a summary bill of the dates and times for consulting or professional services performed beginning July 19, 1997 until January 14, 1999. The invoices, dated April 4, 1999, totaled $28,403.50 for soil testing and $110,246.53 for the professional services. However, in the letter, Mr. Lott alluded to a previous verbal agreement that he would cap the consulting fees to a maximum of $100,000, and that he would honor that agreement, suggesting that Jones-Odom could become current by paying for the analytical testing on a "net 30" basis and $10,000 per month for the consulting (professional) services. Jones-Odom apparently never made any subsequent payment for either category.
On March 19, 2001, approximately 23 months after the bill was sent, Mid-South filed a petition captioned "Petition on Open Account" for the professional and analytical services rendered to Jones-Odom. Jones-Odom responded with a motion for partial summary judgment on grounds that most of the services (soil testing and consultation) had been performed more than three years prior to the filing of the petition, and, therefore all fees incurred prior to March 19, 1998 had prescribed. This amounted to the full $28,403.50 in analytical services and $93,354.33 of the *104 professional services according to Jones-Odom. Additionally, Jones-Odom moved for a partial summary judgment ruling that Mid-South could not recover more than $6,645.67, the difference between the alleged $100,000 cap on professional fees and the $93,354.33 that had prescribed. Finally, it sought a summary judgment ruling that Mid-South was not entitled to any attorney fees because it had not correctly stated the amount due as required by the statute and jurisprudence.
The trial court granted Jones-Odom's motion with respect to the prescribed fees totaling $28,403.50 and $93,354.33 of the professional fees, but it denied the motion limiting any recovery by Mid-South to $6,645.67 and excluding recovery of attorney fees authorized under the open account statute.
Mid-South filed the instant devolutive appeal on the prescription issue, and Jones-Odom has answered the appeal regarding those parts of its motion for partial summary judgment that were denied.
LAW
Summary judgment procedure is designed to secure the just, speedy and inexpensive determination of every action; the procedure is favored and shall be construed to accomplish these ends. La. C.C.P. art. 966(A)(2). Summary judgment shall be rendered forthwith 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 material fact and that the mover is entitled to judgment as a matter of law. La. C.C.P. art. 966(B). Appellate courts review summary judgments de novo under the same criteria that govern the district court's consideration of whether summary judgment is appropriate. NAB Natural Resources, L.L.C. v. Willamette Industries, Inc., 28,555 (La.App. 2 Cir. 8/21/96), 679 So.2d 477.
The initial burden of proof in summary judgment remains with the mover to show that no genuine issue of material fact exists. Johnson v. Sunbelt Builders, Inc., 02-0959 (La.App. 3 Cir. 2/5/03), 838 So.2d 907. Under La. C.C.P. art. 966(C), once the mover has made a prima facie showing that the motion should be granted, the burden shifts to the non-moving party to present evidence demonstrating that material factual issues remain. Id. Despite the legislative mandate that summary judgments are now favored, factual inferences reasonably drawn from the evidence must be construed in favor of the party opposing the motion, and all doubt must be resolved in the opponent's favor. Willis v. Medders, 00-2507 (La.12/8/00), 775 So.2d 1049. The court must draw those inferences from the undisputed facts which are most favorable to the party opposing the motion. Independent Fire Insurance Co. v. Sunbeam Corp., 99-2181, 99-2257 (La.2/29/00), 755 So.2d 226. Summary judgment should be denied if (1) there is a genuine issue of fact and (2) it is material to the case. Smith v. Our Lady of the Lake Hosp., Inc., 93-2512 (La.7/5/94), 639 So.2d 730.
Open Account or Professional Services
The determinative issue in this case is when prescription commenced running on the amounts due. Mid-South contends that commencement of prescription ultimately turns on whether its agreement or relationship with Jones-Odom was an "open account," or an agreement to provide "professional services," both of which are subject to the three-year prescriptive period. La. C.C. art. 3494.[2] While the *105 remedy provided by the "open account" statute, La. R.S. 9:2781, is available to collect "debts incurred for professional services," plaintiff argues that the distinction between the nature of an open account relationship and a professional services agreement affects the date payment is due, and hence, when prescription commences.[3] In a classic open account arrangement, payment for goods and services is generally exigible or payable upon delivery or performance. Mid-South contends that payment for the professional services it provided did not become exigible until the last professional service was rendered.
Jones-Odom contends, and the trial court agreed, that payment became exigible for each service rendered by Mid-South as it was rendered. Hence, according to this view, each time Mid-South took a soil sample, analyzed it, evaluated the results, or consulted with defendant about them, payment for each separate service became exigible, which is to say, Mid-South could submit an invoice for payment for each service performed. Since the prescriptive period for professional services begins to run from the date payment becomes exigible and continues to accrue as to past due payments even if there is a continuation of labor or services, all demands for payment for any services performed more than three years prior to filing the petition have prescribed.
In point of fact, however, Mid-South did not bill or "invoice" the defendant on a monthly, or on another periodic basis typical of credit accounts, which are analogous to open accounts. Dixie Mach. Welding & Metal Works, Inc. v. Gulf States Marine Technical Bureau, Inc., 96-869 (La.App. 5 Cir. 3/12/97), 692 So.2d 1167. There was no written contract between Mid-South and Jones-Odom, and the record does not indicate any agreement as to the terms of payment. The only evidence in the record of an agreement is the April 23, 1999 letter from Larry Lott to Marshall Jones. In that letter, Lott states that because "there has not been any recent activity on the Anderson Island project, we believe it is necessary to itemize the charges to date in order to update your files." After reaffirming his commitment to cap the consulting fees at $100,000 despite an invoice total of $110,246.53, he proposed that "since we are a service vendor and consultant" the analytical testing should be paid on a "net 30" basis," while the professional services could be paid on a retainer basis of $10,000 per month." Clearly, Lott was trying to set up an "open account" arrangement at this time, at least regarding the testing, perhaps on the advice of his CPA, as he suggests in his letter.
Both parties submitted affidavits. James Davis, a partner in the Jones-Odom law firm and one of the attorneys representing the claimants in the federal case, *106 submitted an affidavit attesting that all of the samples taken, their analyses, and the reports by Mid-South were performed prior to December 31, 1997, and this fact is evidenced by Mid-South's response to a subpoena duces tecum served on Mid-South by an opposing law firm. Davis did not attest to the terms of the agreement between Jones-Odom and Mid-South.
Larry Lott, CEO of Mid-South, submitted an affidavit in opposition contradicting some of the facts attested to by James Davis. In his affidavit, Lott stated that he "entered into an agreement with [Jones-Odom] for ongoing investigative environmental assessment and development of methodology of risk-based total petroleum hydrocarbon speciation" in connection with the lawsuit. Further, he continued to take soil samples well beyond December 31, 1997, and providing evidence of one taken in June of 1998 that was featured in the Shreveport Times. He said also that there was testing of the samples beyond January 1, 1998 "to verify the qualitation [sic] of risk-based TPH[4] methods." He submitted evidence of this by producing a facsimile of an article on the matter that he sent to Marshall Jones regarding this type of testing that Mid-South was performing, and he stated that he had telephone conversations with Jones regarding the testing during that time.
The open account statute was amended in 1983 and broadened to allow professionals that rendered a one-time service to use the streamlined procedure of an action on open account to recover payment. The amendment applies to professional services only. Professionals were always accommodated by the open account statute prior to the amendment; however, the statute failed to address the situation where professional services were rendered in a single transaction. The analogy between professional services and typical open accounts is in the nature of the relationship between the parties and the payment collection process. Professionals, such as lawyers and doctors, frequently render services by billing hours or visits over a period of time. Open accounts are made up of a series of transactions or course of dealings over a period of time. Mine & Smelter, Div. of Kennedy Van Saun Corp. v. Ceres Gulf, Inc., 526 So.2d 404 (La.App. 4 Cir.1988).
In the instant case, Jones-Odom argues that the trial court correctly characterized the action as a suit on open account, as La. R.S. 9:2781 clearly states "open account" shall include debts incurred for professional services, including but not limited to legal and medical services. Indeed, courts have frequently treated claims for professional services as open accounts. See e.g., Heck v. Lafourche Parish Council, 2002-2044 (La.App. 1 Cir. 11/14/03), 860 So.2d 595, writ denied, XXXX-XXXX (La.3/19/04), 869 So.2d 837 (engineering services); Brod Bagert, A Professional Law Corporation v. D'Hemecourt, 95-1036 (La.App. 5 Cir. 3/26/96), 672 So.2d 998 (legal services); Wells & Parker Architects, Inc. v. Monroe-McKeen Plaza Housing Development Corporation, 556 So.2d 191 (La.App. 2 Cir.1990). (architectural services).
In Heck v. Lafourche Parish Council, supra, the court considered such factors as whether (1) the services provided are performed over time involving various projects; (2) the total fee for the services is left open; and (3) billing occurs on a regular basis by the provider of the professional service by sending regular periodic invoices setting forth the amounts for the services performed, e.g. monthly statements. These factors are not wholly *107 determinative, nor exclusive. Obviously the 1983 amendment allows for an open account action, even for a "one-time" service; however, open accounts ordinarily contemplate a series of transactions between the parties over an indefinite future period. The total cost, unlike a contract, is generally left open or undetermined, although the rate for specific services may be fixed, such as an hourly rate. Finally, the service provider generally requests that the vendee or client keep current on charges through regular billing, and usually sends monthly invoices.
In this instance, there was no written contract or agreement, and the affidavits are silent in this regard. The April 23, 1999 letter was an obvious attempt by Mid-South to set up an "open account" concerning the testing services and consulting services it had rendered to Jones-Odom.
The record indicates the following: (1) Mid-South agreed to take soil samples from the Anderson Island Subdivision, analyze them, and serve as a consultant in the litigation; (2) the total fee for gathering the samples and the analytical testing was left open, apparently dependent on the number of samples and the types of testing; however, the consulting fee was capped at $100,000; (3) there is no evidence of an agreement regarding billing, and no regular billing occurred; (4) invoices were sent only once, and this was 21 months after Mid-South began rendering its services. The invoicing appears to be an attempt to comply with the statutory requirements to file a suit on open account.
Although it is not controlling, Mid-South filed suit under the caption "Petition on Open Account." It is well-settled that the caption of a petition does not control the relief a court may grant. Additionally, R.S. 9:2781 expressly references professional services, including "one-time" transactions. Of course, the purpose of the statute was to allow professionals like doctors and lawyers to collect attorney fees, along with the unpaid professional charges.
The record in this case does not support the conclusion that this was a typical open account arrangement. There was an oral agreement to provide analytical and professional services, but there is no evidence regarding the terms of payment or that Mid-South was lax in not sending monthly statements. However, even though the arrangement was not clearly an open account, it was subject to the three-year liberative prescription. La. C.C. art. 3494. This statute lists open accounts separately from professional services; thus it is reasonable to conclude that a "services rendered" situation or a "professional services" situation is not, ipso facto, an "open account" simply because the "open account" remedy may be an available remedy to collect for professional services. Because Mid-South did not regularly bill or invoice Jones-Odom, nor was there evidence of any agreement for payment on a periodic, regular basis, we cannot unequivocally conclude that the relationship between Mid-South and Jones-Odom was in the nature of an "open account," rather than simply an agreement to provide professional services.
Commencement of Prescription
The determinative issue in this case is when prescription began running on the debt or debts. The court agreed with Jones-Odom's position that prescription began to run when each professional service was rendered. The court stated: "It also seems clear that the services, both analytical and other services, were exigible upon rendition." Since the petition was filed on March 19, 2001, the court concluded that each service rendered on or before March 18, 1998 had prescribed. In other *108 words, if Mid-South took a soil sample on May 9, 1997, payment for taking the sample was exigible on that date and prescription began to run. If Mid-South tested that sample one month later, payment for that testing became exigible on that day and prescription began to run.
La. Civil Code Article 3495 states that "prescription commences to run from the day payment is exigible. It accrues as to past due payments even if there is a continuation of labor, supplies, or other services." Thus the question is whether payment for the analytical and professional services was exigible when each service was rendered.
In Hargrove, Guyton, Van Hook and Ramey v. Blanchard, 216 So.2d 127 (La.App. 2 Cir.1969), the court held that the three-year prescriptive period for payment of legal fees did not begin to run until the termination of legal services. See also, Lyons v. Hall, 90 So.2d 519 (La.App. 2 Cir.1956); Mouton, Champagne & Colomb v. Bourgeois, 208 So.2d 546 (La.App. 3 Cir.1968).
In Evans-Graves Engineers, Inc. v. Cunard, XXXX-XXXX (La.App. 1 Cir. 12/15/95), 665 So.2d 794, writ denied, XXXX-XXXX (La.3/15/96), 669 So.2d 419, the court held that a real estate developer's debt for an engineering firm's services became exigible for purposes of prescription when the development project was abandoned. The court noted that the engineering firm never performed work on a contingency basis, and customarily rendered a bill at a milestone in the project, such as beginning of construction, financing approval, or when the project is abandoned.
In Buras v. Schultz, XXXX-XXXX (La.App. 4 Cir. 2/9/00), 752 So.2d 981, writ denied, XXXX-XXXX (La.4/28/00), 760 So.2d 1178, the court held that the three-year prescriptive period within which a former court reporter could bring his action to recover money allegedly owed for transcripts he prepared on behalf of indigent defendants did not begin to run until funds were available to the Judicial Administrator for payment of outstanding invoices.
In the instant case, the record is silent as to any agreement or expectations of payment for Mid-South's services. Mid-South billed Jones-Odom when the field work and analysis was completed and the litigation had stalled. The last services rendered by Mid-South, however, occurred after March 18, 1998, less than three years prior to filing suit. At that time, it appeared to Mid-South that there was no more activity in the case and the field work in the case was more or less complete. This situation is analogous to the Evans case where payment for the engineering services was exigible upon reaching either a milestone in, or abandonment of, the project. Since no more work was performed, the case is also somewhat analogous to Blanchard, supra. In any event, prescription could not begin to run until the plaintiff could expect or demand payment. Buras v. Schultz, supra.
Mid-South was hired to do a job that would take some time to complete. As the cases reflect, there are many circumstances in the business world where a professional services provider cannot expect payment until certain stages of completion of the job are reached or when the job is finished. In the absence of any evidence of an agreement by the parties as to the terms of payment for the service Mid-South would provide, a genuine issue of material facts exists as to when prescription began to accrue.
Accordingly, the partial summary judgment granted to Jones-Odom is reversed, and the case remanded for further proceedings.
*109 ANSWER TO THE APPEAL
Jones-Odom answered the appeal alleging that the trial court erred in not granting its motion for partial summary judgment dismissing any claim for professional services in excess of $6,645.67, the difference between the amount of the prescribed debt and the alleged $100,000 cap on professional services stated in the April 23, 1999 letter from Lott to Marshall Jones. In its petition, Mid-South sought the actual services rendered amount of $110, 246.53 along with the $28,403.50.
From this record, we cannot conclude that Jones-Odom is entitled to the $100,000 cap for professional services, inasmuch as it apparently refused to pay for any of the services rendered. We affirm the trial court judgment.
Additionally, Jones-Odom appeals the court's ruling denying their motion for summary judgment dismissing Mid-South's claim for attorney fees. The open account statute states that to be entitled to attorney fees, the plaintiff must show that it sent "written demand correctly setting forth the amount owed." Jones-Odom contends that the amount demanded was not correct. First, it claims it received three demands: the April 23, 1999 letter; a letter from Rick Fayard, plaintiff's original counsel dated January 22, 2001; and the petition. Both the petition and the letter from Fayard state the amount as $138,650.03, and the demand letter states $110,246.53 along with $28,403.50 for testing. But Jones-Odom argues that this is incorrect because the letter also references the agreement to cap the professional services at $100,000. Additionally, Jones-Odom contests three of the charges for professional services from a Dr. JDS. Specifically, Jones-Odom contends that each were billings for 8 hours, all dated the same day. Lott responded to this in his affidavit stating that the date referred to the day that he received the bill from Dr. JDS, not the date the testing was performed.
We conclude that these are disputed factual determinations best resolved at trial. We note, however, that the April 23, 1999 letter is not a demand letter as claimed by Jones-Odom. It is a cover letter to a bill and a proposal to Jones-Odom to pay the bill on time. The trial court is in the best position to determine whether the correct amount was stated in a demand letter as required by La. R.S. 9:2781, and whether the invoices for services rendered contain errors.
For these reasons, we affirm the trial court's denial of the partial summary judgment motion regarding these claims.
CONCLUSION
In conclusion, we reverse the partial summary judgment holding that Mid-South's claims for payment for services performed prior to March 19, 1998 had prescribed, and we affirm the judgment in all other respects. We remand for further proceedings in accordance with this opinion. Jones-Odom is cast for costs of this appeal.
REVERSED IN PART, AFFIRMED IN PART, REMANDED.
CARAWAY, J., concurs with written reasons.
CARAWAY, J., concurring.
I respectfully concur.
I would clarify that the majority's emphasis on the analogous implications of Hargrove, Guyton, Van Hook and Ramey v. Blanchard, 216 So.2d 127 (La.App. 2d Cir.1969), and the related jurisprudence, does not establish a rule of law for the ultimate adjudication of this case on remand, but only serves to illustrate the fact-sensitive *110 nature of this dispute and the material fact issues that remain.
The Blanchard ruling can be criticized for its failure to cite the Civil Code's legal measure for adjudication of the issue which suggests a different result as seen in the language of former Civil Code (1870) Article 3535. That article, which is the source article of the present Article 3495, stated that "prescription takes place, although there may have been a regular continuance of ... service" by the service provider. Certainly, the attorneys in Blanchard, who were to be paid by the hour regardless of the outcome of the litigation, arguably provided "a regular continuance" of distinct services throughout the extended litigation period of Mr. Blanchard's domestic action. What defense lawyers and their clients in domestic cases expected regarding the time for payment of fees in the 1960's was no doubt well understood by the judges when that case was adjudicated. Nevertheless, a closely similar attorney fee dispute today involving a defense lawyer and his insurance company/client might result in the application of prescription to bar the collection of fees for services rendered six or more years before the filing of the collection suit.
The reasonable expectations of the client and the service provider regarding the time for payment of services is not usually appropriate for adjudication by summary judgment, but may be tried either summarily with the peremptory exception or with the merits of this case.
NOTES
[1] 73 Fed.Appx. 78 (5th Cir.(La.) June 19, 2003) (not selected for publication in the Federal Reporter, NO. 02-30123). The suit was dismissed via summary judgment.
[2] Louisiana Civil Code Article 3494 states:
The following actions are subject to a liberative prescription of three years:
(1) An action for the recovery of compensation for services rendered, including payment of salaries, wages, commissions, tuition fees, professional fees, fees and emoluments of public officials, freight, passage, money, lodging, and board;
* * *
(4) An action on an open account; [.]
[3] The term "open Account" is not expressly defined by statute; however, La. R.S. 9:2781(D) states in pertinent part:
"[O]pen account" includes any account for which a part or all of the balance is past due, whether or not the account reflects one or more transactions and whether or not at the time of contracting the parties expected future transactions. "Open Account" shall include debts incurred for professional services, including, but not limited to, legal and medical services.
[4] TPH means "Total Petroleum Hydrocarbons." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588516/ | 14 So.3d 197 (2007)
WILLIE JACKSON McLENDON
v.
STATE.
No. CR-06-0072.
Court of Criminal Appeals of Alabama.
August 17, 2007.
Decision of the Alabama Court of Criminal Appeals without opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/8304552/ | FAW, P. J.
This is a replevin suit brought in the Chancery Court of Davidson County, Part Two, to recover the possession of a Ford automobile.
The bill was filed on September 15, 1936, by Ruth Cuffman, as complainant, ag'ainst Elizabeth Blunkall, W. S. Miles, R. H. Pigue, deputy sheriff, T. M. Gourley, deputy sheriff, and L. A. Bauman, Sheriff, of Davidson County, Tennessee, as defendants.
Before the cause was at issue below, the complainant, by leave of the court, voluntarily dismissed her suit against all of the named defendants except Elizabeth Blunkall, who answered the bill, and the cause was subsequently heard by the chancellor, and his decree was thereupon entered as follows:
“This cause came on to be heard on May 4, 1937, before Chancellor James B. Newman, upon the pleadings and the testimony of witnesses examined in open court by agreement of the parties filed in the cause and argument of counsel;
“From all of which the Court is of opinion and finds that the defendant, Elizabeth Blunkall, was the owner of the ticket that drew the car involved and that this ticket was delivered by her on the day preceding the night of the drawing to the complainant, Ruth Cuff-*515man, as her agent, and that Ruth Cuffman held the ticket as agent of Elizabeth Blunkall and that the title and possession of the ear involved was in Ruth Cuffman as agent for Elizabeth Blunkall, and that Elizabeth Blunkall is entitled to possession of this car.
“The Court further finds that the car involved was a Ford V-8, 1936 model, and was delivered to the complainant some time in September, 1936, and had been driven only 166 miles and since it was replevied in September, 1936, the car has been in the hands of the bondsmen of complainant and in storage. The only testimony as to the value of this ear is by the father of Elizabeth Blunkall who operates an automobile repair shop and does not claim nor does the proof show that he is an expert qualified to testify as to the market value of cars, and his testimony that this car has depreciated in value $259 is a mere conclusion.
“It appears from the undisputed facts that it has been about six months since this car was delivered, that it has been driven only 166 miles and is in practically the same condition except the change of model, as it was when sold, and the Court finds and fixes as nominal damages for its detention, the sum of $25.
“It is therefore ordered, adjudged and decreed by the Court that the complainant Ruth Cuffman return the automobile involved to the defendant Elizabeth Blunkall and on failure so to do that the defendant, Elizabeth Blunkall have and recover of the complainant, Ruth Cuffman, the sum of $659, the value of the ear on the date of its seizure under the replevin writ, with interest from the date of such seizure, to-wit, September 30, 1936', to date, amounting to $23.33 and making a total of $682.33, said judgment to be satisfied by return of the said automobile to the defendant; and that the said defendant-have and recover of said complainant and J. M. Cuffman and’S. T. Cuffman, sureties on her replevin bond, the sum of $25 as damages for the seizure and detention of said automobile, and all costs of the cause, for which an execution will issue.
“And it is further ordered, adjudged and decreed by the Court that if said automobile is not returned to the defendant and the writ of fieri facias issued therefor is returned unsatisfied in whole or in„ part, the defendant may have a final judgment over by motion without notice against the complainant and her sureties on the replevin bond for the sum of $682.33.
“Whereupon the complainant moved the Court for a new trial on the following grounds:
‘ ‘ 1. That there is no evidence to' support the decree of the Court. •
“2. The evidence preponderates against the decree of the Court and the decree is against the law governing the matters in controversy; which motion was overruled by the Court and the complainant excepted thereto.
*516“To so much and sucb parts of tbe decree as renders judgment against tbe complainant for tbe possession of tbe car and judgment against ber for damages for tbe detention and costs, tbe complainant excepts and prays an appeal to tbe present term of tbe Court of Appeals sitting at Nashville, wbicb is by tbe Court granted upon ber perfecting ber appeal, as required by law, and sbe is allowed thirty days from tbe entry of this decree in wbicb to perfect ber appeal and file ber bill of exceptions.”
In due season, tbe appellant, Ruth Cuffman, filed tbe oath prescribed for poor persons and a bill of exceptions, for tbe purpose of perfecting ber appeal.
At tbe threshold of tbe consideration of this case, we are met with a motion on behalf of tbe defendant-appellee, Elizabeth Blunkall, to dismiss tbe appeal of tbe complainant-appellant, Ruth Cuffman, upon tbe ground that tbe appellant has not perfected ber appeal “as required by law, ’’ in that, sbe has filed no appeal bond, but is attempting to prosecute ber appeal upon tbe pauper’s oath.
Tbe contention of appellee is, in substance, that an appeal by complainant on tbe pauper’s oath leaves tbe defendant without security for tbe return of tbe automobile and tbe damages awarded for its detention. This is, we think, a mistaken assumption.
When this suit was instituted in tbe chancery court tbe complainant filed a replevin bond in double tbe value of tbe property replevined ($1318), with two sureties, and tbe solvency or sufficiency of tbe bond is unquestioned on tbe record. If this court should affirm tbe decree of tbe chancellor awarding thé possession of tbe automobile in controversy to the defendant, we would, of course, affirm tbe judgment against tbe complainant and tbe sureties on ber replevin bond. Tbe defendant has precisely tbe same security for tbe value of tbe automobile and tbe damages for its detention that sbe bad while the cause was pending in tbe chancery court.
In tbe case of Scott v. Brandon, 125 Tenn., 314, 317, 318, 143 S. W., 601, tbe court said:
“While it is true a replevin suit cannot be instituted on tbe pauper oath, .the reason is that in sucb an action there is a transfer of tbe property from tbe defendant to tbe plaintiff, immediately upon tbe bringing of tbe suit, before tbe right of tbe conflicting claims is determined. Bond is therefore required of tbe plaintiff; ‘the rule for the security,’ as. said by tbe court, ‘being founded on the natural law that one shall not wrongfully and under color of tbe law appropriate to himself that which belongs to another.’ Horton v. Vowel, 4 Heisk., 622. As observed by the court in the same ease, the bond' in replevin suits is required for tbe security of tbe property; not for the security of the costs.
“In Horton v. Vowel, supra, it was held that replevin could not *517be prosecuted in forma pauperis. However, tbe statutory bond having been given for double tbe value of tbe property at tbe institution of tbe suit, it was permissible for tbe plaintiff, when during tbe progress of tbe suit tbe costs bad accumulated to a larger amount than tbe bond would protect, on a rule upon bim for further security, to take tbe pauper oath. Tbe court said:
“ ‘After tbe property is secured, the action, in all other respects, is nothing different from tbe more common forms. It is therefore a consequence that, as to such costs as exceed tbe penalty of tbe bond, tbe plaintiff may prosecute tbe suit in forma pauperis.1 ”
In support of appellee’s motion to dismiss tbe appeal, her counsel cite Horton v. Vowel, 4 Heisk., 622, and Kincaid v. Bradshaw, 6 Baxt. 102.
In Horton v. Vowel, supra, tbe Supreme Court bad under consideration an appeal in error from a judgment of tbe circuit court dismissing the plaintiff’s suit for want of security for costs. Tbe court recited the statutes relating to tbe institution of actions of replevin, and, after a statement that “an action of replevin, cannot under a proper construction of this statute, be prosecuted in forma paup-eris,” with tbe reasons for such rule, tbe court said: “After the property is secured, tbe action, in all other respects is in nothing different from tbe more common forms; it is, therefore, a consequence that as to such costs as exceed tbe penalty of the bond tbe plaintiff may prosecute tbe suit in forma pauperis;” and tbe court reversed the judgment of the circuit court; thus ruling that “after tbe property is secured” tbe plaintiff may prosecute a replevin suit on tbe pauper’s oath.
Kincaid v. Bradshaw, supra, was an action of replevin commenced before a justice of tbe peace and carried to the circuit court by appeal, no bond having been given, but tbe pauper’s oath being substituted, both upon tbe institution of tbe suit and upon tbe appeal. During tbe pendency of tbe case, tbe defendant moved to dispauper tbe plaintiff and dismiss the suit because its prosecution was frivolous. Tbe circuit court dismissed the case, being satisfied by the testimony of disinterested witnesses that its prosecution was frivolous. From this judgment the plaintiff appealed to the Supreme Court upon the pauper’s oath; but tbe evidence on which tbe circuit court acted was not preserved by bill of exceptions, and tbe Supreme Court held that it was bound to presume that there was sufficient evidence to sustain tbe action of tbe court below. Having thus ruled, the Supreme Court, in its opinion (which is quite brief) then concluded as follows: “But it was decided by this court in Horton v. Vowel, 4 Heisk., 622, that the action of replevin cannot be prosecuted under tbe pauper’s oath, nor can an appeal to this court be prosecuted by tbe plaintiff except *518■upon tbe bond required by law. The judgment of the court below dismissing the suit was not erroneous, and is affirmed.”
In order to arrive at the meaning of the court, the language of a judicial opinion should be interpreted in the light of the case with which the court was dealing. In Kincaid v. Bradshaw, supra, no replevin bond had been given, either at the institution of the suit or subsequently; hence an appeal to the Supreme Court could not be prosecuted in the absence of the bond required by law, that is, the replevin bond to secure the property replevined and damages for its detention. It will be observed that, in that case, the court did nbt dismiss the appeal, but affirmed the judgment of the circuit court dismissing the suit. It is also, seen that the court cited, with approval, Horton v. Vowel, supra, wherein the court had said that "after the property is secured, the action, in all other respects is in nothing different from the more common forms.”
In Hamilton v. Henney Buggy Co., 102 Tenn., 714, 718, 52 S. W., 160, 161, the court said: "There is no statute requiring bond for more than damages and costs on appeal to this court in replevin suits,” — the "damages, consisting of the interest on the recovery.”
It appearing from the- record that the complainant gave a proper and sufficient replevin bond at the inception of this suit, upon which the chancery court rendered judgment in favor of the defendant, we are of the opinion that the complainant is entitled to prosecute her appeal to this court on the pauper’s oath. The defendant’s motion to dismiss complainant’s appeal is, therefore, overruled.
The chancellor’s findings of fact are embraced in his decree, which has been copied in full herein. The appellant’s assignments of error are that (1) "There is no evidence to support the decree of the court;” (2) "The evidence preponderates against the decree of the court and the decree is against the law governing the matters in controversy;” and (3) "The entire decree or such parts of same which renders judgment against the complainant for the possession of the car and the judgment against her for damages for detention and costs is also assigned as error.”
The foregoing assignments are quite general and indefinite, and it is doubtful whether they are sufficiently specific to conform to the rules governing assignments of error. See Rule 11 in Williams’s Annotated Code, vol. 7, page 546, and numerous eases cited in Crawford’s Tennessee Digest, vol. 1, pages 234-240.
However, as the case was tried on oral testimony of witnesses examined in open court “T>y agreement of the parties filed in the cause,” and, therefore, it must be heard de novo in this court, we will treat the assignments of error as asserting that the decree of the chancery court is not supported by the preponderance of the evidence.
Complainant alleges in her bill, in substance, that she is the owner *519of a certain Ford automobile coacb, 1936 Model, motor No. 18— 3198141, now located in tbe Paige Garage, on Fifth Avenue and Commerce Street, Nashville, Davidson County, Tennessee; that said automobile is “brand new” and, in its present condition, is worth $659 in cash; that defendant, Elizabeth Blunkall, has taken said automobile out of complainant’s possession by means of a void replevin suit before a justice of the peace of Davidson County, Tennessee; that said replevin suit is void because, in fixing the amount of the replevin bond, the automobile was valued at less than $500 in order to bring the case within the jurisdiction of a justice of the peace, and the complainant’s surety on said bond is not worth the amount of the bond above his exemptions; that the value of said automobile exceeds $500 and the justice of the peace therefore has no jurisdiction of said replevin suit, and if complainant “allows the matter to run along and does not assert her rights, the car will likely be worn out before she can ever get it into her possession; ’ ’ that she is entitled to the immediate possession of said automobile, and the defendants are unlawfully withholding same from her “under the guise of legal proceedings null and void on their face.”
Complainant filed, as exhibit A to her bill, a bill of sale which, she alleged, conveyed said automobile to her on September 11, 1936.
Complainant prayed that the writ of replevin issue upon bond executed, and that the property be restored to complainant; that complainant have a decree against defendants for damages for detention and the abuse of said property while in their possession.
Defendant Elizabeth Blunkall filed an answer to complainant’s bill, in which she denied that complainant is the owner of the automobile replevined in this case, or entitled to the possession thereof, and she alleged that she (the defendant) is the lawful owner, and entitled to the possession, of said automobile. Defendant admits in her answer that said automobile is “new,” and she admits* the value placed thereon by the allegations of the bill.
Complainant also admits in her answer that the justice of the peace did not have jurisdiction of the replevin suit (mentioned in complainant’s bill) and she states that, for that reason, she has had said J. P. suit dismissed, such dismissal being without prejudice to her rights in this suit. Defendant “denies that she had any wrongful intent in filing suit in the justice court. ’ ’
"We find that the greater weight of the evidence shows the facts which will now be stated.
On and for a time prior to September 11, 1936, the Crescent Amusement Company operated a number of moving picture theaters in the city of Nashville, Tennessee, including one known as the Woodland Street Theater. At these theaters each person paying for admission during a specified period was given a ticket which entitled him (or *520her) to participate in a “drawing” for (among other things) a Ford automobile, which “drawings” were conducted by the Crescent Amusement Company in each of its theaters in Nashville on stated, and previously advertised, occasions. One of these “drawings” occurred in the evening of September 11, 1936. According to the “regulations” of the drawings, as advertised by the Crescent Amusement Company, the tickets were “not transferable” and “the holder of the number” had “to be present to win.”
The complainant and defendant were unmarried young women, living with their respective parents in the same general neighborhood in the city of Nashville. They were intimate friends and associates and they “usually went together to the show.17
Shortly after noon on September 11, 1936, complainant visited the home of defendant and proposed to defendant that they go to the show that night. Defendant stated to complainant that she couldn’t go because she “didn’t have the money;” whereupon complainant proposed that she would take defendant’s ticket for her, and agreed that if defendant’s ticket won the car defendant would get the car. Thereupon defendant delivered to complainant two tickets, one belonging to defendant and one belonging to defendant’s mother — the latter ticket being delivered to complainant with a similar agreement. Before handing the two tickets to complainant, the defendant made a memorandum of 'the numbers of the tickets — indicating which ticket belonged to her and which to her mother, and also wrote, in pencil, her initials, “E. B.” — on the corner of the back of her ticket, and the word “mamma” on the back of her mother’s ticket. The compláin-ant had six tickets belonging to her. Complainant attended the drawing at the Woodland Street theater that night and when the number winning the automobile was announced, complainant handed the ticket bearing that number to an usher, who carried it to the manager conducting the drawing, and the manager announced “Miss Ruth Cuffman,” the complainant, as the winner of the automobile, and instructed her to meet him at 10 o ’clock on the following morning1 at the office of the Crescent Amusement Company and the car would be delivered to her.
After the “drawing” as aforesaid, complainant called defendant’s home on the telephone, from the theater, and stated to defendant’s mother, who answered the telephone, to “come and get her, she had the car;” that she had something to tell them but couldn’t tell them over the phone. Thereupon, defendant, with her father and mother, drove to the Woodland Street Theater, and complainant there said to defendant: “It was your ticket that got the car.” Defendant and her parents then took complainant to her home in their car, and on the way complainant told defendant, in substance, that as soon as *521sbe got the ear she would call defendant and come to defendant’s home.
On the following morning (September 12th), complainant went with the manager of the Woodland Street Theater to a Ford dealer in the city of Nashville, where the automobile in controversy, together with a bill of sale for same, was delivered to complainant; but complainant did not call defendant or come to her home, and would not answer the telephone (although defendant called for her repeatedly thereafter), and, according to the undisputed testimony of defendant, complainant has not spoken to defendant since the night of September 11, 1936.
Defendant secured possession of the automobile in controversy by means of the aforesaid replevin suit in the court of the justice of the peace; but it was later taken from defendant’s possession and delivered to complainant, pursuant to the replevin writ in this case.
Upon a review and consideration of all the evidence, we concur in the chancellor’s findings that the defendant, Elizabeth Blunkall, was the owner of the ticket that drew the ear involved, and that this ticket was delivered by her on the day preceding the night of the drawing to the complainant Ruth Cuffman, as her agent, and that complainant Ruth Cuffman held the ticket as agent of Elizabeth Blunkall, and that the title and possession of the car involved was in Ruth Cuffman as agent for Elizabeth Blunkall, and that Elizabeth Blunkall is entitled to the possession of said automobile.
It is argued on behalf of complainant that the automobile in controversy was obtained in an unlawful gambling transaction, and, therefore, the court will not aid either party involved. It is somewhat difficult to understand how the rule which complainant thus seeks to invoke would, if applicable, aid the complainant, who, by her bill in this ease, is seeking the aid of the court to obtain possession of the automobile.
But, aside from the suggestion just made, there are two sufficient answers to the contention that the court should deny its aid because the automobile was obtained in a gambling transaction.
(1) Under the holding in State ex rel. v. Crescent Amusement Co., 170 Tenn., 351, 95 S. W. (2d), 310, the automobile in controversy was not obtained in a gambling transaction or lottery.
(2) Ah agent receiving profits cannot set up against his principal the illegal character of the transaction in which they were realized. The maxim, in pari delicto potior est conditio defendentis has no application to such case. Pointer v. Smith, 7 Heisk., 137, 144; Memphis & Arkansas River Packet Co. v. Agnew, 132 Tenn., 265, 272, 177 S. W., 949, L. R. A., 1916A, 640.
It results that the appellant’s assignments of error are overruled, *522and the decree of the chancery court is affirmed, and a decree will be entered accordingly.
The costs of the appeal will be adjudged against the appellant Ruth Cuffman.
The cause will be remanded to the Chancery Court of Davidson County, Part Two, for the execution of the decree.
Crownover, J., and E. C. Arnold, Special Judge, concur. | 01-03-2023 | 10-17-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/1646361/ | 9 So.3d 859 (2009)
Louis E. MADERE, et al.
v.
David and Renee CHRISTENSON, et al.
No. 2009-CD-1142.
Supreme Court of Louisiana.
June 3, 2009.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2586018/ | 144 P.3d 81 (2006)
IN RE Q.H.
No. 96202
Court of Appeals of Kansas
October 20, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588511/ | 752 F.Supp. 248 (1990)
William ROBINSON, Plaintiff,
v.
PEOPLE OF the STATE OF ILLINOIS, Defendant.
No. 90 C 3444.
United States District Court, N.D. Illinois, E.D.
July 3, 1990.
MEMORANDUM OPINION AND ORDER
SHADUR, District Judge.
William Robinson ("Robinson"), a prisoner at the Sandstone, Minnesota Federal Correctional Institution ("Sandstone"), brings this action in the nature of mandamus under 28 U.S.C. § 1361 ("Section 1361"). Robinson seeks to compel the State of Illinois to respond to a motion that he has filed in his state court criminal case in the Circuit Court of Cook County, asking removal of a detainer the State has lodged against Robinson at Sandstone.
According to Robinson, that motion was never placed on the Circuit Court's docket and the State has made no attempt to respond to it. Robinson would like to have the detainer removed so that he can become eligible for placement in a Community Treatment Center. Because he is now in federal custody, he erroneously believes it is appropriate for him to turn to a federal court for relief. Accordingly he asks leave to file in forma pauperis and proceed here on his mandamus request.
Although Robinson's just-described procedural misunderstanding is certainly excusable in a nonlawyer, his mandamus request is actually directed at the wrong party and presented to the wrong court. It requires only a brief discussion to explain why his current effort is mistaken in both those respects.
First, Robinson names the State itself as his targeted respondent, but the State has no obligation to respond to his Circuit Court motion absent an order of the judge before whom the motion is pending. Because the crux of Robinson's problem is not so much in getting the State to respond to his motion as in getting the state court to entertain it, the state judge who is hearing Robinson's motion should therefore be named as the respondent in this action.
That problem could of course be curedeither (1) by Robinson's reframing his pleading to name the state judge instead of the State or (2) by this Court's construing the mandamus request as an action against the state judge. But neither of those procedural steps would help Robinson here. Section 1361 explicitly restricts itself to actions against "an officer or employee of the United States or any agency thereof" (emphasis added). And this Court has no superintending functionlet alone controlover the state court. Federal *249 courts have no general power to compel action by state officers, including state judicial officials (Davis v. Lansing, 851 F.2d 72, 74 (2d Cir.1988); Van Sickle v. Holloway, 791 F.2d 1431, 1436 n. 5 (10th Cir. 1986); Moye v. Clerk, DeKalb County Superior Court, 474 F.2d 1275, 1276 (5th Cir.1973) (per curiam); Haggard v. Tennessee, 421 F.2d 1384, 1386 (6th Cir.1970); and numerous other authorities cited in those cases). If Robinson wants to compel judicial action on his motion, he should apply to the state court for mandamus relief (see People ex rel. Knight v. O'Brien, 40 Ill.2d 354, 363-64, 240 N.E.2d 686, 692 (1968) (per curiam)).
Thus no arguable legal basis exists for Robinson's mandamus request. This Court denies his motion for leave to file in forma pauperis and dismisses this action pursuant to 28 U.S.C. § 1915(d) (see Neitzke v. Williams, 490 U.S. 319, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989)).[1]
NOTES
[1] This opinion's reference to the procedural availability of a state mandamus remedy must not be mistaken as any indication that Robinson has an ultimate legal right to obtain such relief. Indeed, under the facts alleged in this case it would not appear that Robinson has any right to expect the State to remove the detainer. Robinson's state sentence does not expire until March 30, 1991 (he alleges his federal sentence runs out three days later). That would suggest that the State has lawful grounds for maintaining the detainer against Robinson even though his state sentence will have ended just before his currently projected release date from federal custody. That may be perceived by the State as a protective measure in the event Robinson obtains an earlier federal release than may now be projected. Documents attached to his mandamus request show that Robinson is now eligible for parole, creating the possibility that he could be released from federal custody before expiration of his state sentence. But Moody v. Daggett, 429 U.S. 78, 88 n. 9, 97 S.Ct. 274, 279 n. 9, 50 L.Ed.2d 236 (1976) teaches that no due process right (and that appears to mean no liberty interest) is implicated by the effect that the detainer is having on Robinson's eligibility for placement in a Community Treatment Center. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588518/ | 944 So.2d 376 (2006)
HART
v.
UNEMPLOYMENT APPEALS COM'N.
No. 5D06-360.
District Court of Appeal of Florida, Fifth District.
November 21, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/312400/ | 481 F.2d 1272
UNITED STATES of America, Plaintiff-Appellee,v.George Truett SETTLES, Jr., Defendant-Appellant.
No. 73-1373 Summary Calendar.*
United States Court of Appeals,Fifth Circuit.
June 21, 1973.
Patrick A. Robertson, Dallas, Tex., for defendant-appellant.
Anthony J. P. Farris, U. S. Atty., James R. Gough, Asst. U. S. Atty., Houston, Tex., for plaintiff-appellee.
Before WISDOM, AINSWORTH and CLARK, Circuit Judges.
AINSWORTH, Circuit Judge:
1
Settles appeals his conviction for possession with intent to distribute 288 pounds of marijuana. He contends that border patrol agents have no authority to search for drugs, that the evidence against him obtained by such a search should have been excluded, and that statements he made after he was given Miranda1 warnings should have been excluded at trial. We affirm his conviction.
2
Border patrol agents in Laredo, Texas, observed brick-shaped objects inside burlap bags in the back of the pickup truck Settles was driving. They questioned Settles, inspected the burlap bags, found marijuana, arrested Settles, and gave him Miranda warnings. He then told them that he had purchased the approximately 300 pounds of marijuana contained in the burlap bags.
3
Settles' argument that the border patrol agents had no authority to search for drugs was disposed of in United States v. Thompson, 5 Cir., 1973, 475 F.2d 1359. There we explained that "[b]y a series of proper delegations, border patrol officers have been designated by the Treasury Secretary as customs agents." After setting forth those regulations, we continued:
4
By letter/order of the Assistant Commissioner of the Bureau of Customs, dated July 14, 1971, all special agents were required to designate all current border patrol officers and future appointees as acting customs patrol officers.
5
This Court has often recognized that a border patrol officer may be validly authorized to act simultaneously as a customs agent.
6
475 F.2d at 1362. See generally United States v. Wright, 5 Cir., 1973, 476 F.2d 1027; United States v. McDaniel, 5 Cir., 1972, 463 F.2d 129; United States v. Bird, 5 Cir., 1972, 456 F.2d 1023; United States v. Maggard, 5 Cir., 1971, 451 F.2d 502.
7
Border patrol agents are authorized to act as customs agents; thus, the officers here clearly acted within their authority. The district judge did not consider that their action constituted a search of the vehicle; rather, he reasoned that the officers saw what they believed to be the commission of a felony-the transportation of contraband-and acted to prevent further violation of the law. We hold that under the circumstances the border patrol agents' action was reasonable and the evidence they obtained was admissible at trial.
8
As counsel for the appellant says, the Miranda decision "speaks for itself." Consequently, his allegation that Settles' post-Miranda statements should have been excluded escapes our comprehension.
9
Affirmed.
*
Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Company of New York et al., 5 Cir., 1970, 431 F.2d 409, Part I
1
Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966) | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/2586205/ | 156 P.3d 39 (2007)
2007-NMCERT-003
LOVATO
v.
ARCHULETA.
No. 30,220.
Supreme Court of New Mexico.
March 27, 2007.
(COA 26,785). Denials of Certiorari. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588485/ | 85 S.W.3d 809 (2002)
Larry Allen HAYES, Appellant,
v.
The STATE of Texas.
No. 73830.
Court of Criminal Appeals of Texas, En Banc.
September 11, 2002.
*812 John Dunn MacDonald, Conroe, for Appellant.
Marc Brumberger, Assistant District Attorney, Conroe, Matthew Paul, State's Attorney, Austin, for State.
Before the court en banc.
WOMACK, J., delivered the opinion for a unanimous Court.
The appellant was convicted in May 2000 of capital murder. Tex. Penal Code sec. 19.03(a). Pursuant to the jury's answers to the special issues set forth in Code of Criminal Procedure article 37.071 sections 2(b) and 2(e), the trial judge sentenced the appellant to death. Article 37.071 § 2(g).[1] Direct appeal to this Court is automatic. Art. 37.071, sec. 2(h). The appellant raises four points of error including challenges to the sufficiency of the evidence at the punishment phase. We shall affirm.
STATEMENT OF FACTS
In 1999, the appellant and his wife, Mary Hayes were living together at 2667 South Woodloch in Conroe, Texas. On July 13, 1999 the appellant told his stepson that his wife was having an affair and that "[he did not] think that he could forgive her like she forgave me." Cathy Varner also testified that during the week of July 16, 1999 the appellant suspected an affair between Mary Hayes and Gary Hurt, Mrs. Hayes's co-worker.[2] Mr. Hurt testified that the appellant called him about the affair and said: "Don't you know that people get killed over these things?"
On July 16, 1999 between 10:45 and 11:00 p.m., Paula Odendalski, the appellant's neighbor, heard a shrill, high-pitched noise and saw Lauren Hayes, the appellant's ten-year-old daughter, running across the street. Ms. Odendalski met Lauren in her driveway and asked her what was happening. Lauren was screaming and said that her father was trying to kill her mother. Ms. Odendalski called 911 at 10:51 p.m. Lauren told the 911 operator that she heard her mother and the appellant fighting. The appellant was hitting Mrs. Hayes on the head and chased her into Lauren's bedroom. Lauren ran into the bedroom and saw that the appellant had shot her mother in the hand. Mrs. Hayes tried to crawl under Lauren's bed to escape. Hazel Hayes, the appellant's mother, also ran to the room and tried to stop the appellant. At that point, Lauren ran out of the house and heard several more shots. During the 911 phone conversation Lauren also told the operator that she thought that the appellant left the house in a black Chevy Suburban truck.
The police arrived and found Hazel Hayes wailing inside of the house. She told the police that the appellant and Mrs. Hayes were fighting over Mrs. Hayes's alleged affair and that she tried to stop the appellant, but it didn't work. She said that he reloaded his gun and asked her for a kiss before he drove away. The police found the body of Mary Hayes in Lauren Hayes's bedroom. There was blood on the wall and the bed and brain matter and skull fragments on the floor. Dr. Parungao, the assistant medical examiner of Harris County, testified that she was shot *813 seven times, three times in the head, once in the left shoulder blade, twice in the back, and once in the hand.[3] Two of the wounds were close contact wounds, fired within six inches of the body. The victim's head was described as "shattered" and "crushed." The police also recovered eight "spent" .44 magnum cartridge casings at the scene.
Shortly after killing his wife, the appellant drove to the Diamond Shamrock gas station at FM 3083 and Creighton Road in Montgomery County. A witness testified that she saw the appellant lead the clerk, Rosalyn Robinson, out of the store at gunpoint to Ms. Robinson's white Ford Mustang. As the witness started to drive away she heard a gunshot.
When the police arrived on the scene they found Ms. Robinson lying on the ground in front of the appellant's black Suburban, alive, but unresponsive. Later Ms. Robinson died. Dr. Parungao testified that the cause of death was multiple gunshot wounds to the head and abdomen. Ms. Robinson was shot three times, once in the abdomen, once in the right arm, and once in the face. Ms. Robinson's white Mustang was missing.
A man named Vale Yates testified that later that same evening he stopped at a Super 8 Motel in Cleveland, Texas. He was having some trouble with the starter in his Chevy Blazer, so he left the truck running while he went inside to check in. When he returned, his Blazer was gone and parked behind where it had been was Rosalyn Robinson's white Mustang. Inside the Mustang was an overnight bag containing prescription medications bearing the appellant's name, a cartridge carrier, and three spent shell casings.
The Polk County Sheriff's Department received a dispatch at 12:20 a.m. to report to a Dandy Double truck stop in Polk County, Texas to apprehend a potential suspect from Montgomery County. Sharon Glass and her husband reported that a man driving a Chevy Blazer asked them for a jump in the parking lot. When he turned to the side, Mrs. Glass saw a large gun tucked into the waistband of his pants. When the deputy sheriff apprehended the appellant, he was walking south across the Dandy Double parking lot with his shirt off and tucked into his waistband. The officers yelled at him to put his hands up, and the appellant turned and pulled away the white t-shirt to reveal a .44 magnum. The appellant then started to raise the gun, and Sergeant Waller fired a shot which missed the appellant. The appellant moved into a "shooter stance" and Sergeant Waller fired a second shot into the appellant's back. The appellant was taken into custody and transported to Columbia Conroe Medical Center for medical attention. At the punishment phase of trial, nurses testified that the appellant was verbally and physically abusive and threatened to kill one nurse "if he could get his hands on her."
SUFFICIENCY OF THE EVIDENCE ON PUNISHMENT
In his first point of error, the appellant claims that the evidence presented at trial was legally insufficient to support the jury's finding that he was a continuing threat to society. See Art. 37.071, sec. 2(b)(1). In reviewing the sufficiency of the evidence on punishment, this Court looks at the evidence in the light most favorable to the verdict to determine whether any rational trier of fact could have believed beyond reasonable doubt *814 that the appellant would probably commit future criminal acts of violence that would constitute a continuing threat to society. See Jackson v. Virginia, 443 U.S. 307, 318-19, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979); Ladd v. State, 3 S.W.3d 547, 558 (Tex.Cr.App.1999). The circumstances of the offense alone may be sufficient to support an affirmative answer to the first special issue. Kunkle v. State, 771 S.W.2d 435, 449 (Tex.Cr.App.1986). If the circumstances of the case are sufficiently cold-blooded or calculated, then the facts alone may support a finding of future dangerousness. Id. Other evidence, such as prior criminal record, prior bad acts and uncharged conduct, psychiatric evidence, and character evidence, also may support the finding. Also relevant are possible mitigating factors such as the state of mind of the appellant at the time of the offense. Id. The appellant contends that his "inability to cope" with his wife's alleged affair provoked him to kill her. The jury was not required to accept his contention, and the State presented evidence that the appellant knew of the alleged affair the week preceding the murder. This does not support a finding that this was a crime of passion since the appellant had a significant "cooling off" period from the initial shock.
In addition, other evidence supports a finding that the murder was cold-blooded and calculated. The appellant's weapon was not automatic and had only a six-round capacity. Since the appellant shot at his wife eight times, he had to stop and manually unload and then reload more ammunition before shooting at her at least twice more. Furthermore, the appellant's defense of passion does not explain the unprovoked murder of Rosalyn Robinson. According the store's surveillance tape which was admitted at trial, the appellant took Ms. Robinson's keys and led her by gunpoint to her car where he shot her three times. Before the appellant shot Ms. Robinson he transferred his overnight bag to her car. These facts reflect the planning and calculation that was involved in these crimes.
The State also presented evidence that the appellant lacked remorse about the murders after he was arrested. Two weeks after his arrest, the appellant asked an attendant why he was placed on suicide watch at the Montgomery Jail infirmary. The attendant replied that "it should be obvious [because] he murdered two people and we were concerned about his state of mind." The inmate looked directly into the attendant's face and replied that "he had nothing to be suicidal about and that he had no suicidal thoughts whatsoever."
The appellant's long criminal history of escalating violent offenses permit a rational jury to conclude that the appellant would continue to be a threat to society. Accordingly, we hold that the evidence is legally sufficient to support the jury's affirmative answer to the future dangerousness issue. Point of error one is overruled.
BRADY CLAIM
In point of error two, the appellant claims that his right to a fair trial under the due process clause of the Fourteenth Amendment was violated when the State failed to disclose favorable punishment evidence. Specifically, he objects that the prosecution did not disclose a letter written by the appellant to his mother-in-law, Rosa Faust, in which he says that he is "sorry for what he has done."
The standard under Brady v. Maryland is that the prosecutorial suppression of exculpatory evidence violates due process when the evidence is material either to guilt or to punishment. 373 U.S. 83, 87, 83 S. Ct. 1194, 10 L. Ed. 2d 215 (1963). Brady involved the suppression of *815 a companion's confession to the crime, exculpating the defendant. Id. at 84, 83 S. Ct. 1194. The Supreme Court also stated that the "[Brady] rule ... applie[d] in three quite different situations. Each involved discovery after trial of information which had been known to the prosecution but unknown to the defense." United States v. Agurs, 427 U.S. 97, 103, 96 S. Ct. 2392, 49 L. Ed. 2d 342 (1976) (emphasis added). In Havard v. State, this Court held that the Brady rule did not apply when the appellant was already aware of the information. 800 S.W.2d 195, 204 (Tex.Cr.App. 1989) (overruling an alleged Brady error involving an appellant's prior statement to police). "[A]ppellant knew of the fact that he made a statement to the police and the content of that statement ... [He] knew of both the existence and the content of the statement, as a matter of simple logic, because he was there when he made it." Id. See also Jackson v. State, 552 S.W.2d 798, 804 (Tex.Cr.App.1976) ("We cannot conclude that the prosecutor violated his duty to disclose favorable evidence to the appellant when the evidence was already available to him"). The appellant's situation is similar to that in Havard and Jackson. He was aware of the existence of, as well as the contents of, the letter to Rosa Faust because he wrote it. Therefore, this case is not within the Brady rule. Point of error two is overruled.
ADMISSION OF PHOTOGRAPHS
In points of error three and four, the appellant claims that the trial court erred in admitting autopsy photographs on the grounds that they were inflammatory and that their prejudicial value far outweighed their probative value.[4] Tex.R. Evid. 403. Specifically, the appellant objects to State's exhibits 11C, D, and E and 19A on the grounds that they depict the work of the medical examiner and not the actions of the appellant himself.
The admissibility of a photograph is within the sound discretion of the trial court. Rule 403 of the Texas Rules of Evidence states:
Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury or by consideration of undue delay, or needless presentation of cumulative evidence.
Rule 403 favors the admission of relevant evidence and carries a presumption that relevant evidence will be more probative than prejudicial. Montgomery v. State, 810 S.W.2d 372, 376 (Tex. Cr.App.1990) (op. on original submission). The trial court's decision will not be disturbed on appeal unless it falls outside the zone of reasonable disagreement. Jones v. State, 944 S.W.2d 642, 651 (Tex.Cr.App. 1996).
A court may consider many factors in determining whether the probative value of photographs is substantially outweighed by the danger of unfair prejudice. These factors include: the number of exhibits offered, their gruesomeness, their detail, their size, whether they are in color or in black and white, whether they are close-up and whether the body depicted is clothed or naked. Wyatt v. State, 23 S.W.3d 18, 29 (Tex.Cr.App.2000). A court, however, should not be limited to this list. The availability of other means of proof and the circumstances unique to each individual case should also be noted. Id.
*816 In addition, autopsy photographs are generally admissible unless they depict mutilation of the victim caused by the autopsy itself. Rojas v. State, 986 S.W.2d 241, 249 (Tex.Cr.App.1998). Changes rendered by the autopsy process are of minor significance if the disturbing nature of the photograph is primarily due to the injuries caused by the appellant. Santellan v. State, 939 S.W.2d 155, 173 (Tex.Cr.App.1997) (holding autopsy photographs depicting swabs in and a red stain around the victim's mouth admissible).
Exhibits 11 C, D, and E depict Mary Hayes's head and torso from three different angles. During trial Dr. Parungao testified that when he received the body it was so deformed and shattered that he had to shave the head, stitch it back together, and put paper inside of the head to expand it in order to see the entry and exit wounds. When asked whether he was required to stitch the portions of the head, he replied that "I had to so I [could] see the alignment of the skinthe entrance wound or the laceration, because it [was] just a messed up head." Exhibit 19A depicts Rosalyn Robinson with a gunshot wound to her face and a portion of the skin pulled back. The State claims that there are no facts in the record supporting the appellant's claim that the wound was altered by Dr. Parungao during the autopsy. In its brief, however, the State directly cites to the portion of the record where the prosecutor admits at a bench conference that the wound was altered:
PROSECUTOR: That is the wound that he's going to testify there was a grazing wound that fractured her skull at the point.
COURT: And he opened it up to look at it closer, or that is what it looked like?
PROSECUTOR: No. He opened it up to look at it closer.
Statements made at the bench, though not heard by the jury, are still part of the record if recorded. Tex.R.App. P. 13.2(b)(3). The State's claim that this finding is unsupported by the record is incorrect.
The entry and exit wounds were relevant to the way in which the victim was killed. Without reconstruction, the jury would have seen pictures of a collapsed, bloody head. Dr. Parungao's alteration made the head less gruesome, rather than more gruesome as the appellant contends. The trial court did not abuse its discretion. Point of error three is overruled.
Exhibit 19A depicts Rosalyn Robinson's skin pulled back around a grazing gunshot wound to the head, showing the path of the bullet as it passed through her face, fracturing her facial bone and bruising the brain. If the skin were not pulled back, the jury would not be able to see the full extent of one of her fatal injuries. The action of pulling back the skin did not make the evidence significantly more gruesome. In addition, even if the picture were unduly prejudicial under Rule 403, any error that does not affect a substantial right of the appellant is harmless. Tex.R.App. P. 44.2. Tex.R. Evid. 103(a). We will not overturn a case on a non-constitutional error if, after examining the record as a whole, we have a fair assurance that it did not influence the jury, or influenced them only slightly. Schutz v. State, 63 S.W.3d 442, 444 (Tex.Cr.App. 2001). Considering the weight of other evidence, including additional autopsy photographs and the Diamond Shamrock surveillance tape showing the appellant shooting Ms. Robinson, admission of 19A did not unduly influence the jury in its decision. Point of error four is overruled.
We affirm the judgment of the trial court.
NOTES
[1] Unless otherwise indicated all future references to Articles refer to the Code of Criminal Procedure.
[2] Cathy Varner was the live-in girlfriend of Gary Hurt at the time of the trial. She and Mr. Hurt insisted that no affair took place. Ms. Varner requested that Mr. Hurt take a polygraph examination to prove that no relationship between him and Mrs. Hayes existed. Ms. Varner and Mr. Hurt testified at trial that he took the test on July 15, 1999 and passed with 99.9% accuracy.
[3] Initially, Dr. Parungao testified that Mary Hayes was shot only six times. However in his testimony he describes seven separate injuries.
[4] The appellant does not contest the relevance of the photographs. See Santellan v. State, 939 S.W.2d 155, 171 (Tex.Cr.App.1997) (overruling the appellant's relevance objection on appeal because the point was not preserved with a 403 objection at trial). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588488/ | 752 F. Supp. 1373 (1990)
In re VMS SECURITIES LITIGATION.
No. 89 C 9448.
United States District Court, N.D. Illinois, E.D.
October 19, 1990.
On Motion for Reconsideration October 31, 1990.
*1374 *1375 *1376 *1377 David J. Bershad, Robert A. Wallner, Milberg, Weiss, Bershad, Specthrie & Lerach, Lead Counsel, New York City, Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Liaison Counsel, Chicago, Ill., for plaintiffs.
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., for David Albert and Ilene D. Albert (89 C 9448), H. Budd Mittleman (90 C 0179), Joseph G. and Mary T. Iantuono (90 C 0460), Judith Ludwig (90 C 0461).
David J. Bershad, Robert A. Wallner, Milberg, Weiss, Bershad, Specthrie & Lerach, New York City, for David Albert and Ilene D. Albert (89 C 9448), H. Budd Mittleman (90 C 0179).
Robert W. Mills, Law Offices of Robert W. Mills, San Rafael, Cal., for David Albert and Ilene D. Albert (89 C 9448).
Mark C. Gardy, Abbey & Ellis, Curtis V. Trinko, Law Offices of Curtis V. Trinko, New York City, Richard S. Schiffrin, Schiffrin & Craig, Chicago, Ill., for Mary A. Marangos (90 C 0426).
Robert S. Atkins, Robert Williams, Robert S. Atkins & Associates, Chicago, Ill., Kenneth G. Gilman, David Pastor, Gilman and Pastor, Revere Beach, Mass., for Lavinia Holzhaur (90 C 0396).
Robert S. Atkins, Robert Williams, Robert S. Atkins & Associates, Chicago, Ill., Robert L. Leiff, Elizabeth Joan Cabraser, William B. Hirsch, Marilyn Kaplan, Leiff, Cabraser & Heimann, San Francisco, Cal., for Margot B. Duxler (90 C 0445).
Sherrie Savett, Berger & Montague, Philadelphia, Pa., Richard S. Schiffrin, Schiffrin & Craig, Chicago, Ill., for Edward McDaid (90 C 0369).
Michael J. Freed, Joseph D. Ament, Michael B. Hyman, Much Shelist Freed Denenberg Ament & Eiger, Chicago, Ill., Bruce E. Gerstein, Bertram Bronzaft, Garwin Bronzaft Gerstein & Fisher, New York City, for Jeffrey Alexander (90 C 0459).
Ronald L. Futterman, Hartunian Futterman & Howard, Chicago, Ill., Robert W. Kirby, Lubna M. Faruqi, Kaufman Malchman Kaufman & Kirby, New York City, for Sol Klughaupt (90 C 0576).
Lawrence Walner, Lawrence Walner & Associates, Chicago, Ill., for Walter D. Ford, Sr. (90 C 0278).
Arthur T. Susman, Terry Rose Saunders, Susman, Saunders & Buehler, Stephen C. Shamberg, Stackler & Shamberg, Donald Statland, Chicago, Ill., Stephen Lowey, *1378 Richard C. Fooshee, Lowey, Dannenberg, Bemporad, Brachtl & Selinger, P.C., New York City, for Paul J. Isaac and David E. Robbins (90 C 0904), George Barcik, Norman Berman, Cook Bros. Money Purchase Pension Trust and Cook Bros. Profit Sharing and Retirement Trust (90 C 1074).
Stephen B. Diamond, Beeler, Schad & Diamond, Chicago, Ill., for Alan L. Hess (90 C 0952).
Robert D. Allison, Law Offices of Robert D. Allison, Chicago, Ill., for John E. Holcomb (90 C 1200).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., David B. Zlotnick, Zlotnick & Thomas, Bala Cynwyd, Pa., for Quaker Valley Meats (90 C 1358).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., Stuart D. Wechsler, Wechsler Skirnick Harwood Halebian & Feffer, New York City, for Stewart J. Eisenberg (90 C 1428).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., David J. Bershad, Robert A. Wallner, Milberg Weiss Bershad Specthrie & Lerach, New York City, for Lewis D. Rubin (90 C 1496).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., Michael S. Glassman, Kathleen L. Clemens, Clemens, Glassman and Clemens, Los Angeles, Cal., for John A Falco and Ilana M. Falco (90 C 1535).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., Glen DeValerio, Margaret G. Dobies, Melissa M. Thomson, Berman, DeValerio & Pease, Boston, Mass., Stanley Grossman, Pomerantz, Levy, Haudek, Block & Grossman, New York City, for Holly Paramenter and Ruth Anne Dykeman (90 C 1560).
Robert M. Roseman, Mark S. Goldman, Rudolph, Seidner, Goldstein, Rochestie & Salmon, P.C., Eugene A. Spector, John F. Innelli, Eugene A. Spector & Associates, Philadelphia, Pa., for Marie Matson (90 C 1621).
Marvin A. Miller, Patrick E. Cafferty, Chertow & Miller, Chicago, Ill., Klari Neuwelt, Wolf Popper Ross Wolf & Jones, New York City, for Barbara Tepperman (90 C 1639).
Barry B. Gross, Joel Sprayregen, Nicholas H. Diacou, Clifford E. Yunkis, Shefsky & Froehlich, Ltd., Chicago, Ill., for VMS Mortg. Inv. Fund.
Matthew Gluck, Jane Wasman, Fried, Frank, Harris, Shriver & Jacobson, New York City, for VMS Realty Investors.
Timothy A. Nelson, Donna L. McDevitt, Skadden, Arps, Slate, Meagher & Flom, Chicago, Ill., for Prudential-Bache Properties, Inc., Prudential-Bache Securities, Inc.
Byron L. Gregory, Steven Hoeft, William P. Schuman, McDermott, Will & Emery, Chicago, Ill., Joseph P. Cyr, Morgan, Lewis & Bockius, New York City, Alfred H. Hoddinott, Jr., Asst. General Counsel, Litigation, Xerox Corp., Stamford, Conn., for XCC Inv. Corp., Xerox Corp., Xerox Credit Corp., Melvin Howard.
Allan T. Slagel, Phelan Pope & John, Ltd., Chicago, Ill., for Walter Auch, Sr., David Blalock, Sr., Phillip Brady, Norman Gold, Gerald Nudo, Marvin Sotoloff, Robert Ungerleider, James Wisner.
Sarah R. Wolff, Lowell Sachnoff, Joel M. Neuman, Sachnoff & Weaver, Ltd., Chicago, Ill., for Peter Morris, Joel Stone.
Frank A. Karaba, Charles W. Siragusa and Wade R. Joyner, Crowley, Barrett & Karaba, Chicago, Ill., for Robert D. Van Kampen and Brewster Realty, Inc.
MEMORANDUM OPINION AND ORDER
CONLON, District Judge.
This consolidated class action and shareholder derivative suit was brought on behalf of disappointed investors in one or more of five real estate investment trusts and three real estate limited partnerships (collectively, "the Funds"). The Funds were allegedly sponsored by VMS Realty Partners, one of the defendants. The plaintiff class consists of all persons who purchased securities of the Funds during the period from the first public issuance of any securities of the Funds to February 13, *1379 1990 ("the class period").[1] The consolidated complaint breaks the class down into eight subclasses. Each subclass is comprised of investors of a particular Fund. The subclass members sue on behalf of themselves as purchasers of a Fund's securities, and also derivatively, on behalf of the particular Fund. The forty-nine defendants named in the complaint are:
(a) the eight Funds:
(1) VMS Mortgage Investment Fund;
(2) VMS Hotel Investment Fund;
(3) VMS Short Term Income Trust;
(4) VMS Strategic Land Trust;
(5) VMS Strategic Land Fund II;
(6) VMS Mortgage Investors L.P.;
(7) VMS Mortgage Investors L.P. II;
(8) VMS Mortgage Investors L.P. III;
(b) VMS Realty Partners, the alleged sponsor of the Funds and creator of a vast real estate empire;
(c) the four general partners of VMS Realty Partners:
(1) Brewster Realty, Inc. ("Brewster");
(2) Residential Equities, Ltd. ("Residential Equities");
(3) Van Kampen/Morris/Stone, Inc. ("V/M/S");
(4) XCC Investment Corporation ("XCC");
(d) The members of the VMS Realty Partners executive committee:
(1) Robert D. Van Kampen (alleged co-owner of V/M/S and Brewster);
(2) Peter R. Morris (alleged co-owner of V/M/S and Residential Equities);
(3) Joel A. Stone (alleged co-owner of V/M/S and Brewster);
(4) Melvin Howard (officer and director of Xerox Corporation and Xerox Credit Corporation);
(e) real estate appraisers who allegedly issued opinion letters for the Funds' investments:
(1) Marshall & Stevens, Incorporated ("Marshall & Stevens");
(2) Joseph J. Blake & Associates ("Blake");
(f) companies who allegedly acted as guarantor of the Funds:
(1) VMS Mortgage Investors II, Inc.;
(2) VMS Mortgage Investors III, Inc.;
(3) VMS Financial Guarantee, L.P.;
(4) VMS Mortgage Company;
(5) VMS Mortgage Company II;
(g) underwriters and selling agents for the Funds:
(1) VMS Securities, Inc.;
(2) Prudential-Bache Securities;
(h) certain alleged advisors and "controlling persons" of the Funds:
(1) Prudential-Bache Properties;
(2) VMS Realty, Inc.;
(3) VMS Realty Investors;
(i) general partners of the Funds, including:
(1) VMS Mortgage Investors, Inc.;
(2) VMS Financial Services;
(j) Officers, directors, trustees, and/or alleged "controlling persons" of the Funds, including, but not limited to, the following:
(1) Albert Kopin;
(2) Scott Lager;
(3) Walter Auch, Sr.;
(4) Robert Ungerleider;
(5) Leonard Levine;
(6) Norman Gold;
(7) Marvin Sotoloff;
(8) Gerald Nudo;
(9) James Wisner;
(10) David Blalock, Sr.;
(11) Philip Brady;
(12) Robert Wislow;
(13) Gary A. Rosenberg;[2]
(14) William Sales;
(15) Xerox Credit Corporation;
(16) Xerox Financial Services;
(17) Xerox Corporation;
(k) Jeffrey J. Park, alleged former officer of VMS Realty Partners and Xerox Financial Services.
*1380 The forty-count complaint charges the defendants with violations of the federal securities laws and the Racketeer Influenced and Corrupt Organizations Act ("RICO"). In addition, plaintiffs allege pendent state claims of common law fraud, negligent misrepresentation, breach of contract, and derivative claims of breach of fiduciary duty, waste, mismanagement, and breach of contract.
Defendants filed a joint motion to dismiss the consolidated complaint under Fed. R.Civ.P. 9(b) and 12(b)(6). Defendants also assert that the suit is barred by the statute of limitations.
BACKGROUND
In deciding a motion to dismiss, the court must accept as true all the well-pleaded factual allegations and inferences reasonably drawn from them. Gomez v. Illinois Bd. of Educ., 811 F.2d 1030, 1039 (7th Cir.1987). Dismissal is proper if it appears beyond doubt that the plaintiffs could prove no set of facts in support of their claims that would entitle them to the relief requested. Illinois Health Care Assoc. v. Illinois Dep't of Public Health, 879 F.2d 286, 288 (7th Cir.1989), citing Conley v. Gibson, 355 U.S. 41, 45-46, 78 S. Ct. 99, 101-102, 2 L. Ed. 2d 80 (1957).
A. VMS Realty Partners
Defendant VMS Realty Partners is an Illinois general partnership engaged in real estate investment and development. Consolidated Complaint ("Complaint") ถถ 6, 13(i). Since 1979, VMS Realty Partners and its affiliates have sponsored approximately 115 real estate investment programs, raising more than $2.5 billion from more than 110,000 investors. Complaint ถ 25. These programs include the Funds, which make mortgage loans to affiliated entities. Id. VMS Realty Partners is comprised of four corporate general partners: (1) defendant V/M/S, owned by defendants Van Kampen, Morris, and Stone; (2) defendant Brewster, owned by Van Kampen and Stone; (3) defendant Residential Equities, owned by Morris; and (4) defendant XCC, an indirect subsidiary of defendant Xerox Corporation.[3] Complaint ถถ 13(h, j, k, l, qq, rr, ss). Van Kampen, Morris, and Stone serve on the four-member executive committee of VMS Realty Partners, along with defendant Melvin Howard, who was nominated to the executive committee by Xerox Corporation. Complaint ถถ 13(j, k, l, m).
B. The Funds
Between November 14, 1984 and October 31, 1988, VMS Realty Partners created and sponsored the eight Funds that are the subject of this litigation. Complaint ถถ 6, 13(a-h). Each Fund purported to have a distinct primary purpose. Complaint ถ 26. VMS Short Term Income Trust ("Income Trust")
The Income Trust is a real estate investment trust that made interim short-term loans primarily to affiliates of VMS Realty Partners. Complaint ถถ 26, 90. The affiliated borrowers used the loans to purchase income-producing properties and to finance other costs associated with these properties until the borrowers could find other investors to finance the properties. Complaint ถ 90. The Income Trust's loans were secured by the income-producing properties. Id. Between November 14, 1984 and December 26, 1984, the Income Trust sold its shares through an initial public offering in the principal amount of approximately $69 million, at $10 per share. Complaint ถ 13(a).
Four purchasers of Income Trust securities represent the plaintiff subclass of Income Trust investors: Lewis D. Rubin; Patrick Reed; Cook Brothers Profit Sharing and Retirement Trust ("Cook Bros. PSR"); and Cook Brothers Money Purchase Pension Trust ("Cook Bros. MPP"). Complaint ถ 18(b). The complaint does not allege the dates of purchase for the subclass plaintiffs.
*1381 VMS Mortgage Investors, L.P. ("MILP I")
MILP I was one of three limited partnerships formed to make mortgage loans to affiliated and non-affiliated entities. Complaint ถ 26. The loans carried terms of three, five or seven years, and were secured by various types of improved real estate. Id. Between March 1, 1985 and August 7, 1985, MILP I raised approximately $75 million at $10 per unit during its initial public offering. Complaint ถ 13(b). The following plaintiffs purchased units of MILP I and represent the MILP I subclass: Cook Bros. PSR; Cook Bros. MPP; Edward McDaid; Barbara Tepperman. Complaint ถ 18(c). The complaint fails to allege these plaintiffs' dates of purchase.
VMS Hotel Investment Fund ("Hotel Fund")
The Hotel Fund was formed as a real estate investment trust for the purpose of making mortgage loans secured by hotel and resort properties owned or acquired by affiliates of VMS Realty Partners. Complaint ถถ 26, 173. Between July 12, 1985 and January 6, 1986, the Hotel Fund made its initial public offering and raised approximately $98 million at $20 per unit, each unit consisting of two shares of common stock and one warrant. Complaint ถ 13(c). Eight plaintiffs sue on behalf of the subclass of investors in the Hotel Fund. Complaint ถ 18(f). Two plaintiffs, Marie Matson and David E. Robbins, purchased their Hotel Fund units during the initial public offering. Complaint ถถ 12(v, bb). The complaint does not specify when the remaining representatives of the Hotel Fund subclass purchased their units.[4]
VMS Mortgage Investors L.P. II ("MILP II")
MILP II is the second limited partnership in the VMS Mortgage Investors series. Complaint ถ 26. As with MILP I, this limited partnership made mortgage loans with terms of three, five or seven years to affiliated and non-affiliated entities. Id. The loans were secured by various types of improved real estate. Id. MILP II commenced its initial public offering on January 2, 1986. Complaint ถ 13(d). At the close of the initial public offering, July 3, 1986, MILP II had raised approximately $124 million at $10 per unit. Id. Plaintiffs Ilana and John Falco and Atlantic Electric Supply Corporation Pension Plan ("Atlantic Electric") purchased units of MILP II during the initial public offering. Complaint ถถ 12(c, k, l). These plaintiffs represent the MILP II subclass. Complaint ถ 18(d).[5]
VMS Strategic Land Trust (the "Land Trust")
The Land Trust was formed as a real estate investment trust with the purpose of making short term junior mortgage loans to affiliated borrowers. Complaint ถ 26. These affiliated borrowers sought to acquire and develop "strategically located properties not at their highest and best use." Id. The initial public offering, held between September 9, 1986 and December 31, 1986, sold shares for a total of $119 million at $10 per share. Complaint ถ 13(e). Plaintiff Alan H. Hess represents the subclass of Land Trust investors. Complaint ถ 18(g). The complaint does not state the date Hess purchased his shares.
VMS Mortgage Investors L.P. III ("MILP III")
MILP III, the third limited partnership in the VMS Mortgage Investors series, was formed to make junior mortgage loans, wraparound mortgage loans and first mortgage loans on income-producing properties owned or acquired by affiliates of VMS Realty Partners. Complaint ถ 152. Between December 10, 1986 and June 30, 1987, MILP III offered and sold its units through an initial public offering in the amount of approximately $110 million at $10 per unit. Complaint ถ 13(f). Plaintiffs John A. Falco and Joseph G. Iantuono Profit *1382 Sharing Plan and Trust, Joseph G. Iantuono, Trustee ("Iantuono"), purchased MILP III units during the initial public offering. Complaint ถถ 12(l, r). These two plaintiffs sue on behalf of the subclass of MILP III investors. Complaint ถ 18(e).
VMS Strategic Land Fund II ("Land Fund II")
Land fund II was formed with the same purpose as the Land Trust, and made loans similar in type to those of the Land Trust. Complaint ถ 26. Land Fund II initially offered its shares to the public between August 25, 1987 and January 31, 1988. Complaint ถ 13(g). The following four plaintiffs purchased shares of Land Fund II during the initial public offering: John and Ilana Falco; George Barcik; and Margot Duxler. Complaint ถถ 12(d, h, k, l). These plaintiffs sue defendants on behalf of the subclass of Land Fund II investors. Complaint ถ 18(h).
VMS Mortgage Investment Fund ("MIF")
MIF was a corporation formed with the intent of qualifying as a real estate investment trust. Complaint ถ 26. MIF purported to invest primarily in short term loans, junior mortgage loans, wraparound mortgage loans and first mortgage loans on income-producing properties owned or acquired by affiliated borrowers. Id. MIF also invested in construction loans, pre-development loans and land loans on such properties. Id. The initial public offering raised approximately $395 million at $10 per share. Complaint ถ 13(h). Nine plaintiffs purchased shares of MIF during the initial public offering, from March 30, 1988 to October 31, 1988. Complaint ถถ 12(a, e, i, p, s, v, x, ee). These plaintiffs, David and Ilene Albert, Norman Berman, Ruth Ann Dykeman, Lavinia Holzhauser, Sol Klughaupt, Marie Matson, M. Budd Mittleman and Stanley Schwarz, represent the subclass of MIF investors. Complaint ถ 18(a). The complaint alleges three other plaintiffs, Jeffrey Alexander, Holly Parmenter and Stewart Eisenberg, as representatives of the MIF subclass, but these plaintiffs have not alleged the dates they purchased MIF securities. Id.
C. Allegations Concerning the Funds
Plaintiffs, in no less than forty counts, bring charges against each Fund and the defendants associated therewith. Although each count shall be treated separately on this motion, a description of the general nature of the allegations is instructive.
In essence, the plaintiffs claim that the Funds suffered from gross mismanagement and that the defendants committed securities fraud by misstating the nature of the Funds' business operations and financial condition. Complaint ถถ 15, 28. The defendants allegedly managed the Funds for the benefit of VMS Realty, its principals and affiliates, and to the detriment of the Funds. Complaint ถถ 15, 28. For example, the Funds made loans to affiliates of VMS Realty Partners that were allegedly secured by overleveraged properties with inflated appraisal values. Complaint ถ 30. According to plaintiffs, the Funds issued misleading financial documents failing to apprise investors that overleveraged properties secured the Funds' loans. Id. Plaintiffs claim that VMS Realty Partners routinely advanced money to the Funds' borrowers to enable those borrowers to meet their loan obligations to the Funds. Complaint ถ 31. The foregoing practices were allegedly concealed from investors until November 14, 1989, when each Fund announced in its third quarter 10-Q report that VMS Realty would no longer advance money to the Funds' borrowers. Complaint ถถ 31, 40, 47. The market price of the Funds' shares and units dropped sharply in the wake of this news. Complaint ถ 48. Plaintiffs assert that, given these undisclosed practices, the Funds' projected yields at the initial public offering were unrealistically high, and that the prices of the securities were therefore materially inflated. Complaint ถถ 15, 30. Plaintiffs also claim that, given these undisclosed practices, the Funds' financial statements during the class period were materially misleading because they failed to include adequate reserves for losses on loans and receivables. Complaint ถ 33. Plaintiffs further maintain that defendants falsely *1383 represented the Funds as conservative investments. Complaint ถ 36.
Plaintiffs additionally assert that in order to conceal pervasive liquidity problems confronting VMS Realty Partners and its affiliates, VMS Realty Partners used the Funds to engage in loan churning. Complaint ถ 40. The alleged loan churning scheme required a Fund to make a loan to a limited partnership to enable it to pay off earlier advances from VMS Realty Partners or to retire outstanding loans coming due to another Fund. Id. The Funds also engaged in a variation of loan churning, whereby the Funds would sell or purchase their loans to or from each other. Complaint ถ 40(e). As an additional example of defendants' mismanagement of the Funds, plaintiffs cite the "extraordinarily high" fees that VMS Realty Partners reaped from the Funds and the Funds' borrowers. Complaint ถถ 38, 45.
D. Procedural History
On December 22, 1989, plaintiffs David and Ilene Albert filed a class action on behalf of all investors in MIF against some, but not all, defendants in the present case. Over eleven other class actions suits were subsequently initiated. The first class action to sue all the Funds on behalf of investors in all the Funds was filed on January 11, 1990, and named twenty-seven defendants. On April 30, 1990, all pending cases were consolidated into this single class action on behalf of investors in all eight Funds against the forty-nine defendants.
Plaintiffs filed their consolidated class action complaint on April 30, 1990. Plaintiffs bring counts one through nine under งง 10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. งง 78j(b) and 78t(a), and Rule 10b-5 promulgated thereunder, 17 C.F.R. ง 240.10b-5. Counts ten and eleven allege violations of งง 11 and 15 of the Securities Act of 1933, 15 U.S.C. งง 77k and 77o. Counts twelve through fourteen are brought pursuant to งง 12(2) and 15 of the Securities Act of 1933, 15 U.S.C. งง 77l(2) and 77o. Of the state law claims, counts fifteen through twenty-two allege common law fraud, counts twenty-three through thirty are for negligent misrepresentation, and counts thirty-one through thirty-eight state derivative claims for breach of fiduciary duty, waste, mismanagement and breach of contract. Plaintiffs bring count thirty-nine on behalf of MIF against VMS Financial Guarantee, L.P. for breach of contract. Count forty alleges violations of RICO, 18 U.S.C. ง 1962(a), (b) and (c).
Defendants move to dismiss all counts on three grounds: (1) the statute of limitations has run on all claims; (2) plaintiffs have failed to plead allegations of fraud with particularity as required by Fed.R.Civ.P. 9(b); and (3) the complaint fails to state a claim for which relief may be granted. Fed.R.Civ.P. 12(b)(6).
DISCUSSION
I. The Statute of Limitations
Defendants contend that all plaintiffs' claims are timebarred. The court considers each claim separately in order to determine whether plaintiffs' claims comply with the statute of limitations.
A. Claims Under the Securities Act of 1933
Section 11 of the 1933 Securities Act prohibits the issuance of false or misleading securities registration statements, including the portion of the registration statement that circulates as the prospectus. 15 U.S.C. ง 77k; Short v. Belleville Shoe Mfg. Co., 908 F.2d 1385, 1390 (7th Cir. 1990). Section 12(2) of the Securities Act imposes civil liability on any person who makes a false or misleading statement in the offer or sale of a security, whether in an oral communication or prospectus. 15 U.S.C. ง 77l(2); Ambling v. Blackstone Cattle Co., Inc., 658 F. Supp. 1459, 1462 (N.D.Ill.1987). Section 13 of the 1933 Securities Act sets forth the statute of limitations for actions brought under งง 11 and 12(2) as
one year after the discovery of the untrue statement or the omission, or after such discovery should have been made *1384 by the exercise of reasonable diligence.... In no event shall any such action be brought to enforce a liability created under section 11 ... more than three years after the security was bona fide offered to the public, or under section 12(2) more than three years after the sale.
15 U.S.C. ง 77m.
1. The Three-Year Limit
Section 13 clearly bars all actions not commenced within three years after the sale of the security or the first bona fide public offering of the security. Id. Equitable tolling doctrines do not extend the period of limitations for งง 11 and 12(2) actions beyond this absolute limit of three years. Short, 908 F.2d at 1391. Counts ten through thirteen claim violations of งง 11 and 12(2) on behalf of the MIF and Land Fund II subclasses. Count fourteen, brought on behalf of the MILP III investors, charges defendants with violating ง 12(2). With respect to the MIF and Land Fund II subclasses, plaintiffs filed suit within the three-year outer boundary mandated by ง 13. The four plaintiffs representing the Land Fund II subclass allegedly purchased their shares during the initial public offering, between August 25, 1987 and January 31, 1988. The entire period of the initial public offering falls within three years of the latest possible date this action could be considered filed, April 30, 1990.[6] Similarly, the nine MIF subclass plaintiffs who purchased their shares during MIF's initial public offering, between March 30, 1988 and October 31, 1988, filed their claims well within three years of these alleged purchases.[7] The same is not true, however, for the ง 12(2) claim of the MILP III subclass. The complaint alleges that plaintiffs John Falco and Joseph Iantuono purchased their units of MILP III during the initial public offering, between December 10, 1986 and June 30, 1987. The complaint fails to state the exact dates on which these plaintiffs made their purchases. Thus, according to the complaint, Falco and Iantuono might have purchased their units on the first day of the offering period, December 10, 1986. The first individual complaint against any defendant in this action was filed on December 22, 1989, over three years after December 10, 1986. Therefore, the MILP III subclass has failed to plead facts showing compliance with the three year limitation period as required under ง 13. See Fisher v. Samuels, 691 F. Supp. 63, 71 (N.D.Ill.1988) (plaintiff asserting claims under งง 11 or 12(2) of the 1933 Act must plead facts showing compliance with statute of limitations); Ambrosino v. Rodman & Renshaw, Inc., 635 F. Supp. 968, 972 (N.D.Ill.1986) (plaintiffs do not meet the pleading requirement by merely reciting in the complaint that the action was commenced within the limitations period). Accordingly, count fourteen is dismissed.[8]
2. The One-Year Limit
Having determined that the MIF and Land Fund II subclasses filed suit within the maximum three-year limit, the court must still determine whether these plaintiffs have complied with the one-year limitations period mandated by ง 13. The one-year period begins to run when the investor either knows or in the exercise of reasonable diligence should have discovered the facts on which the suit is based. Fisher, 691 F.Supp. at 71, citing Norris v. Wirtz, 818 F.2d 1329, 1334 (7th Cir.), cert. denied, 484 U.S. 943, 108 S. Ct. 329, 98 L. Ed. 2d 356 (1987). When the defendant lies and the plaintiff does not reasonably investigate, the time starts to run immediately. Norris, 818 F.2d at 1334. In order to comply with the statute of limitations, the complaint must set forth the time and circumstances of discovery of the untrue *1385 statement or omission, state the reasons why discovery was delayed if more than one year has elapsed since the statement or omission was made, and describe plaintiff's diligent efforts to seek discovery. Ambrosino, 635 F.Supp. at 972.[9]
Plaintiffs in the MIF and Land Fund II subclasses base their securities fraud claims on various documents, releases and financial statements allegedly issued by MIF and Land Fund II during the class period. Under ง 11, however, the only documents that bear any legal relevance are the registration statement and the prospectus included in the registration statement. In addition, ง 12(2) punishes false or misleading statements made in connection with the offer or sale of securities. The complaint fails to supply dates of purchase for any plaintiffs except those who bought securities from the Funds during the initial public offerings. The court therefore must limit its analysis of the ง 12(2) claims to statements made in the prospectuses circulated with the initial public offerings.
The complaint alleges that the Land Fund II prospectus, dated August 25, 1987, and the MIF prospectus, dated March 30, 1988, contained a number of materially misleading statements. Complaint ถถ 65-66, 68-69, 72, 212-15. The Land Fund II and MIF plaintiffs first discovered the misleading nature of the prospectuses on November 14, 1989, when Land Fund II and MIF revealed in their 1989 third quarter Form 10-Q reports the "critical role that VMS Realty Partners' financial condition played in [Land Fund II and MIF]s' success." Complaint ถถ 73, 218. Because discovery occurred more than one year after the prospectuses were issued, the Land Fund II and MIF plaintiffs must state why their discovery was delayed. Ambrosino, 635 F.Supp. at 972. In addition, the Land Fund II and MIF plaintiffs must allege that they exercised reasonable diligence in seeking discovery of the fraud. Id. Defendants argue that plaintiffs have not met this requirement. Plaintiffs insist that they need not describe their efforts to discover the fraud, because, they contend, they have alleged that the defendants actively concealed their fraud.
a. Fraudulent Concealment
Under the doctrine of fraudulent concealment, if defendants took additional affirmative steps after committing the fraud to conceal their conduct, the statute of limitations is tolled until plaintiffs actually discover the fraud. Davenport v. A.C. Davenport & Son Co., 903 F.2d 1139, 1142 (7th Cir.1990); Robin v. Doctors Officenters Corp., 686 F. Supp. 199, 207 (N.D.Ill.1988). This doctrine relieves plaintiffs of the obligation to use due diligence to discover the fraud. Davenport, 903 F.2d at 1142. However, to invoke the doctrine of fraudulent concealment, "plaintiff[s] cannot ignore the obvious danger signals ... and there is no license to ignore events giving rise to strong suspicion." Fisher, at 72 (emphasis in original) (citations omitted). In addition, federal equitable tolling requires defendants to take additional affirmative steps of concealment after committing the fraud; mere silence by a defendant who is under a fiduciary duty to disclose fraud is not sufficient to trigger the fraudulent concealment tolling rule. Davenport, 903 F.2d at 1142.
Plaintiffs argue that the complaint states with particularity affirmative acts of fraudulent concealment. Plaintiffs cite several paragraphs in the complaint as examples. However, the majority of those paragraphs do not contain allegations of fraudulent concealment directed at the MIF or Land Fund II plaintiffs. Instead, paragraphs 94, 131, 132, 155, 159, 175, 177 and 198 allege that the Income Trust, MILP II, MILP III, Hotel Fund and Land Trust issued fraudulent financial reports during the class period in an effort to conceal the misleading nature of their investment portfolios. In addition, paragraphs 32, 34 and 36 contain general allegations that the "prospectuses and other documents issued by the Funds" *1386 were materially misleading. These general accusations do not identify specific documents or specify when these purportedly misleading documents were issued, as required by Fed.R.Civ.P. 9(b). Thus, they do not support plaintiffs' claims of fraudulent concealment.
Plaintiffs point to the allegations of loan churning as examples of defendants' efforts to mask the existence of troubled borrowers. However, none of the loan churning allegations in the complaint involve MIF or Land Fund II. Plaintiffs also refer to a letter sent to all investors dated June 2, 1989, in which Joel Stone denied any problems with the Funds and stressed the purportedly safe and secure nature of the Funds' activities. Complaint ถ 66(f). While this letter may constitute a cover-up attempt by defendants, the letter was sent too late to have any tolling effect on the one-year statute of limitations period. By June 2, 1989, the one-year period for discovery of the misleading MIF and Land Fund II prospectuses had already run. Thus, plaintiffs cannot use the Stone letter as a reason they did not discover the fraud within one year of the misleading prospectuses' issuance.
Plaintiffs argue that the documents referred to in ถถ 70 and 212 of the complaint constitute fraudulent concealment. Paragraph 70 of the complaint states
... during the Class Period, [MIF] disseminated documents, including its 1988 Annual Report to Shareholders, Form 10-K for the year ended December 31, 1988, and Forms 10-Q for the periods ending March 1988 through September 1989, which ... failed to disclose that [MIF] was dependent upon the financial condition of VMS Realty Partners.
As an example of the statements contained in these reports, plaintiffs quote MIF's Form 10-Q for the quarter ended June 30, 1989. Complaint ถ 70. As with the June 2, 1989 letter from Joel Stone, this document was circulated to MIF investors too late to have any tolling effect on the one-year limitation period. Paragraph 70 omits quotations from the earlier documents alleged to contain misleading statements. These earlier documents therefore cannot support plaintiffs' fraudulent concealment claims. Fed.R.Civ.P. 9(b). In any event, a fiduciary's failure to disclose, without more, does not amount to an affirmative act of fraudulent concealment. Davenport, 903 F.2d at 1142 (fraudulent concealment doctrine not triggered by plaintiff's claims that fiduciary's ongoing failure to disclose facts material to the sale of securities "lulled" the plaintiff so as to prevent her from uncovering the defendant's fraudulent acts).
Nor can plaintiffs rely on paragraph 212 of the complaint to support allegations of fraudulent concealment. Paragraph 212(a) states that Land Fund II's prospectus implicitly represented that its loans would approximate arm's-length transactions, notwithstanding Land Fund II's practice of lending to affiliates of VMS Realty Partners. Plaintiffs allege that this implied representation was misleading, because Land Fund II made loans to affiliated borrowers that were secured by overcollateralized properties. Complaint ถ 212(a). The paragraph then states:
[a]ll subsequent documents circulated to the investing public during the Class Period, including [annual reports to shareholders and Forms 10-K for the years ended December 31, 1987 through 1988, and Forms 10-Q for the periods ending September 30, 1987 through September 30, 1989], were materially misleading in failing to reveal that [Land Fund II] was engaging in such a practice, despite the defendants' duty to make such a disclosure.
Id. Paragraph 212(a) fails to quote any misleading language from these subsequent documents. Nor have plaintiffs provided copies of these documents indicating to defendants and the court their misleading nature. Furthermore, plaintiffs cannot trigger the fraudulent concealment doctrine by merely alleging that defendants remained silent while under a duty to disclose. Davenport, supra. Therefore, the references to these documents do not adequately allege fraudulent concealment.
Subsection (b) is the only other portion of paragraph 212 that refers to documents *1387 other than the Land Fund II prospectus. Paragraph 212(b) alleges that Land Fund II's prospectus stated its primary investment objectives were to "preserve and protect [Land Fund II]'s capital" and "provide for quarterly cash distributions." Complaint ถ 212(b). According to this paragraph of the complaint, "other documents disseminated during the Class Period, including reports to shareholders ... and Land Fund II's Forms 10-K for 1987 and 1988" reiterated the Fund's primary investment objectives. Complaint ถ 212(b). Plaintiffs do not indicate why these statements were misleading; even if they did, these general statements of Land Fund II's objectives do not amount to fraudulent concealment.
Plaintiffs' final argument with respect to fraudulent concealment is that VMS Realty Partners and its affiliates constantly sought to raise funds through public offerings shortly after completing prior financing. Plaintiffs contend that the purpose of this almost constant state of registration was to mask the serious liquidity problems of the Funds and their affiliated borrowers. Complaint ถ 44. Even if the court accepts this inference, defendants' alleged fund-raising could not operate to conceal any misleading statements in MIF's or Land Fund II's prospectuses. In other words, disguising the liquidity problems of the Funds and their borrowers has little to do with concealing defendants' alleged failure to disclose that the Funds and borrowers depended heavily on VMS Realty Partners. Thus, defendants' constant fund-raising does not constitute fraudulent concealment.
b. Equitable Tolling in the Absence of Fraudulent Concealment
In situations where defendants did not actively conceal fraud, the statute of limitations still may be equitably tolled until the date the plaintiffs discovered the fraud. To succeed on this second theory of equitable tolling, plaintiffs must allege and prove that they remained unaware of the fraud and exercised due diligence in attempting to discover it. Teamsters Local 282 Pension Trust Fund v. Angelos, 815 F.2d 452, 456 (7th Cir.1987); McCool v. Strata Oil Co., 724 F. Supp. 1232, 1235-36 (N.D.Ill.1989). Plaintiffs admit that they have not alleged due diligence. Plaintiffs' Response at 37.
Because the MIF and Land Fund II plaintiffs have not complied with the one-year limitation period, their claims under the 1933 Securities Act are time-barred. Accordingly, the court dismisses counts ten through thirteen.
B. Claims Under the Securities Exchange Act of 1934
The Seventh Circuit recently adopted ง 13 of the 1933 Securities Act as the applicable limitations rule for claims arising under ง 10(b) of the 1934 Securities Exchange Act. Short v. Belleville Shoe Mfg. Co., 908 F.2d 1385 (7th Cir.1990). Under Short, ง 10(b) claims must be filed within one year of the date that a reasonable investor knew or should have known of the claim, but in no event later than three years after the date of sale. Id. at 1390. Equitable tolling doctrines do not extend the period of limitations past the three-year absolute limit. Id. at 1391, citing Norris, 818 F.2d at 1332.
1. Retroactive Application of ง 13 to ง 10(b) Claims
Defendants argue that Short governs plaintiffs' ง 10(b) claims; plaintiffs maintain that the new limitations rule should not be applied retroactively. Although the Short court applied the new limitations rule to the plaintiff's ง 10(b) claims, it expressly reserved for the future a ruling on the issue of retroactive application of the new rule for all ง 10(b) claims. Short, 908 F.2d at 1389-90. Plaintiffs rely on Chevron Oil Co. v. Huson, 404 U.S. 97, 92 S. Ct. 349, 30 L. Ed. 2d 296 (1971) to support their position. In Chevron, the Supreme Court articulated three factors germane to determining whether to apply a rule retroactively. Under Chevron, this court must consider (1) whether the new rule overrules clear past precedent on which litigants may have relied; (2) whether retroactive application of the new rule will further or retard its operation; and (3) whether retroactive application would impose *1388 injustice or hardship. Id. at 106-07, 92 S.Ct. at 355. Plaintiffs point to Kayne v. PaineWebber Inc., 703 F. Supp. 1334 (N.D.Ill.1989), to support their opposition to retroactive application of the new limitations rule. In Kayne, Judge Duff concluded that the first and third Chevron factors weighed heavily against retroactive application of the proposed new limitations rule to ง 10(b) claims. Id. at 1344. Kayne was decided before the Seventh Circuit adopted the new limitations rule for ง 10(b) claims. The issue in Kayne, therefore, was not simply whether to apply the new limitations rule retroactively, but whether to adopt a new limitations rule at all. Without a clear directive from the Seventh Circuit, the Kayne court declined to adopt the new limitations rule because, among other things, it "would create an injustice for those litigants who have relied on the Seventh Circuit's repeated application of [state courts'] limitations period[s] in ง 10(b) and Rule 10b-5 cases." Id. In so holding, the court noted that PaineWebber had not argued any special facts that might warrant retroactive application despite the court's broad ruling that the new limitations period should not be so applied. Id. at 1344 n. 4.
Defendants in the present case argue persuasively that the particular facts here merit application of the new rule retroactively. Plaintiffs first became aware of their claims on November 14, 1989, when defendants publicly announced VMS Realty Partners' problems. Response at 41; Complaint ถถ 47-58. Because plaintiffs were unaware of their claims, they could not have delayed filing suit in reliance on Illinois law. Indeed, the first individual suit was filed just over one month after the November 14, 1989 announcement. Plaintiffs have not shown the court how they have relied on the state limitations period, or that they would suffer undue hardship or injustice if the new rule was applied.[10] Thus, the first and third factors of Chevron favor retroactive application. Indeed, the Seventh Circuit applied the new limitations rule to the litigants in Short, noting that "[the plaintiff] cannot have relied on Illinois law, because she claims to have been unaware of the basis for litigation until a short time before filing suit." Id. at 1390. See also Gatto v. Meridian Medical Assocs., Inc., 882 F.2d 840, 843-44 (3d Cir.1989), cert. denied, ___ U.S. ___, 110 S. Ct. 1136, 107 L. Ed. 2d 1041 (1990) (first and third Chevron criteria not established where appellants could not have relied on a longer period of limitations); Hill v. Equitable Trust Co., 851 F.2d 691 (3d Cir.1988) (retroactively applying ง 13's period of limitations to ง 10(b) claims).
As to the second Chevron criteria, retroactive application would further the purposes of the new limitations rule by removing the "daunting" tasks of determining which state statute applies and whether federal or state tolling rules govern. Short, 908 F.2d at 1388; see also Norris, 818 F.2d at 1332 ("[d]eciding which features of state periods of limitations to adopt for which federal statutes wastes untold hours").[11]
In sum, all three Chevron considerations militate in favor of applying the rule announced in Short to the present case. Therefore, plaintiffs' ง 10(b) claims are governed by the statute of limitations set forth in ง 13 of the 1933 Securities Act.
2. Claims Under งง 10(b) and 20(a) and Rule 10b-5
Counts one through ten allege violations of งง 10(b) and 20(a) of the 1934 Securities Exchange Act, and Rule 10b-5 promulgated thereunder. For the reasons discussed under heading "A" above, the 1934 *1389 Securities Exchange Act claims of the MILP III, MIF an Land Fund II subclasses are precluded by the statute of limitations. Accordingly, counts one, five and eight are dismissed.
Failure to comply with the statute of limitations is but one of several reasons for dismissing the 1934 Act claims of the Income Trust, MILP I an Land Trust subclasses. The plaintiffs representing these subclasses failed to allege the dates they purchased their securities. This omission is fatal to the claims of these plaintiffs, for plaintiffs are obliged to plead affirmative facts showing compliance with the statute of limitations. Fisher, 691 F.Supp. at 71; Ambling, 658 F.Supp. at 1462. The three-year maximum limitations period under ง 13 of the 1933 Act begins to run on the date of sale. Plaintiffs cannot show that they filed suit within three years of the date of sale if they have not alleged these dates.[12] Therefore, counts two, three and seven must be dismissed.
Plaintiffs representing the Hotel Fund subclass, Marie Matson and David E. Robbins, allege that they purchased Hotel Fund securities during the initial public offering, between July 12, 1985 and January 6, 1986. Complaint ถถ 12(v, bb). Even assuming that both Matson and Robbins purchased securities on the last day of the initial public offering, more than three years elapsed before the January 11, 1990 class action was filed.[13] Thus, the Hotel Fund plaintiffs have not met their burden of pleading facts to show compliance with the three-year period of limitations under ง 13. Count six is dismissed.
Plaintiffs John and Ilana Falco, and Atlantic Electric Supply Corporation Pension Plan invested in MILP II between January 2, 1986 and July 3, 1986. Complaint ถถ 12(c, k, l). As with the Hotel Fund subclass, the MILP II plaintiffs cannot escape the mandate of ง 13's absolute three-year limitation period. That period expired on July 3, 1989, before any claim against any defendant was filed. The court must therefore dismiss count four with prejudice.
Plaintiffs bring their remaining 1934 Securities Exchange Act claim on behalf of the entire class against all defendants for violations of งง 10(b), 20(a) and Rule 10b-5. As none of the subclasses have complied with the statute of limitations, the claims on behalf of all eight subclasses collectively are also time-barred. Accordingly, count nine is dismissed.
C. RICO Claims
Plaintiffs' RICO claims are governed by a four-year limitations period. Agency Holding Corp. v. Malley-Duff & Assocs., Inc., 483 U.S. 143, 107 S. Ct. 2759, 97 L. Ed. 2d 121 (1987); Davenport, 903 F.2d at 1143. The Seventh Circuit has yet to determine when a RICO cause of action accrues for limitations period purposes. Other judges of this court and courts in other circuits have adopted one of two standards for RICO accrual. Under the first standardโthe "last predicate act" ruleโthe limitations period begins to run when a defendant commits the last predicate act of the racketeering pattern. Norris v. Wirtz, 703 F. Supp. 1322, 1326 (N.D.Ill.1989) (Marovich, J.). Several judges of this court adhere to this standard. See id.; Citicorp Savings of Illinois v. Streit, No. 84 C 7471, 1987 WL 9318 (N.D.Ill. April 3, 1987) (1987 WL 9318) (McGarr, J.); County of Cook v. Berger, 648 F. Supp. 433, 433-35 (N.D.Ill. 1986) (Kocoras, J.); Newman v. Wanland, 651 F. Supp. 20, 22 (N.D.Ill.1986) (Williams, J.).
Under the second standard, the RICO claim accrues at the time the plaintiff discovers or should have discovered that she sustained an injury from a RICO violation. McCool v. Strata Oil Co., 724 *1390 F.Supp. 1232, 1237 (N.D.Ill.1989) (Bua, J.); Bowling v. Founders Title Co., 773 F.2d 1175, 1178 (11th Cir.1985), cert. denied, 475 U.S. 1109, 106 S. Ct. 1516, 89 L. Ed. 2d 915 (1986). The "discovery" rule enjoys widespread support among other circuits. See, e.g., id.; Riddell v. Riddell Washington Corp., 866 F.2d 1480, 1489-90 (D.C.Cir. 1989); Pocahontas Supreme Coal Co., Inc. v. Bethlehem Steel Corp., 828 F.2d 211, 230 (4th Cir.1987); Compton v. Ide, 732 F.2d 1429, 1433 (9th Cir.1984); Alexander v. Perkin Elmer Corp., 729 F.2d 576, 577 (8th Cir.1984). In addition, at least two other judges in this district follow the discovery rule. See McCool, 724 F.Supp. at 1237 (Bua, J.); Abernathy v. Erickson, 657 F. Supp. 504, 507-08 (N.D.Ill.1987) (Bua, J.); Electronic Relays (India) Pvt., Ltd. v. Pascente, 610 F. Supp. 648, 653 (N.D.Ill. 1985) (Hart, J.). In the present case, the task of determining the appropriate rule is made easier by the parties, who agree that the discovery rule should govern. Response at 42; Reply at 10. Therefore, the statute of limitations for plaintiffs' RICO claims began to run when plaintiffs either discovered or should have discovered that they sustained an injury from defendants' alleged acts of racketeering activity.
We must first determine when these alleged racketeering acts occurred. The alleged pattern of racketeering activity consists of defendants' acts of securities fraud, in violation of ง 10(b) of the 1934 Securities Exchange Act, mail fraud, in violation of 18 U.S.C. ง 1341, and wire fraud, in violation of 18 U.S.C. ง 1343. The securities fraud allegations center around defendants' sale of the Funds' securities. Complaint ถ 358. The wire fraud allegations are based on defendants' alleged use of telephones in connection with the sale of the Funds' securities. Id. Plaintiffs base their mail fraud claims on defendants' alleged use of the mails to disseminate information relating to the Funds "in order to induce persons to purchase the Funds' securities." Id. Therefore, all of the alleged predicate racketeering acts occurred either on the dates the prospectuses were issued, or on the dates plaintiffs purchased their securities. Since none of the plaintiffs who purchased securities during the initial public offering allege their precise date of purchase, the court assumes, for the purposes of the statute of limitations, that the plaintiffs purchased their securities on the first day of the initial public offering for each of the Funds. The prospectuses for each Fund were also issued on the first day of the Funds' public offerings. Thus, the court considers the first date of the initial public offering for each Fund as the date defendants allegedly committed a predicate racketeering act.
The initial public offerings for the Land Trust, Land Fund II, MIF and MILP III all took place less than four years before January 11, 1990, when all Funds were named as defendants for the first time.[14] Thus, the RICO claims with respect to these Funds do not run afoul of the statute of limitations. As for the remaining four Funds, the court need not decide at this time whether any equitable tolling doctrines forestall the statute of limitations. Plaintiffs' RICO claims suffer from numerous deficiencies that require dismissal under Fed.R.Civ.P. 9(b) and 12(b)(6).
D. Common Law Fraud Claims
The common law claims in counts fifteen through thirty-nine are governed by a five-year period of limitations. Ill.Stat.Ann. ch. 110, para. 13-205 (Smith-Hurd 1984). Except for the Income Trust and MILP I securities, all of the Funds' securities were sold within five years of the latest possible date this suit could be considered filed, April 30, 1990. As to the Income Trust and MILP I, plaintiffs fail to allege any purchase dates. Thus, it is impossible to determine whether the statute of limitations bars plaintiffs' common law claims with respect to their purchase of the Income Trust and MILP I securities.
*1391 II. Motion to Dismiss Based on Rule 9(b)
Defendants move to dismiss all counts sounding in fraud for failure to comply with Fed.R.Civ.P. 9(b). Rule 9(b) requires that
In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge, and other condition of mind of a person may be averred generally.
Rule 9(b)'s particularity requirement furthers two basic purposes: (1) to reasonably notify defendants of their roles in the alleged scheme so that they may prepare a responsive pleading; and (2) to "safeguard potential defendants from lightly made claims charging commission of acts that involve some degree of moral turpitude." Bankers Trust Co. v. Old Republic Ins. Co., 697 F. Supp. 1483, 1484-85 (N.D.Ill. 1988) (citations omitted). See also O'Brien v. Nat'l Property Analysts Partners, 719 F. Supp. 222, 225 (S.D.N.Y.1989). These purposes are usually satisfied if the complaint sets forth the time, place, and substance of the alleged misrepresentations, as well as who made the statements and the method by which the misrepresentation was communicated to the plaintiff. Sears v. Likens, 912 F.2d 889 (7th Cir.1990); Flournoy v. Peyson, 701 F. Supp. 1370, 1374 (N.D.Ill.1988). However, conclusory allegations of fraud and averments of state of mind are insufficient to satisfy Rule 9(b). Flynn v. Merrick, 881 F.2d 446, 449 (7th Cir.1989). In addition, a complaint does not satisfy Rule 9(b) if it makes blanket allegations that fail to specifically identify the defendants who made each misrepresentation or omission. Likens, at p. 893 (complaint deficient because it "lump[ed] all the defendants together and d[id] not specify who was involved in what activity"); Coronet Ins. Co. v. Seyfarth, 665 F. Supp. 661, 666 (N.D.Ill.1987) ("[p]laintiffs may not `lump' defendants together in general allegations of fraudulent activity, implying that each defendant is responsible for the statements and actions of others").
Defendants contend that the complaint defies Rule 9(b)'s mandate for particularity in four ways: (1) the complaint fails to differentiate the roles of each defendant; (2) the complaint does not identify the source of alleged misrepresentations; (3) the complaint does not properly plead fraud upon information and belief; and (4) the complaint fails to state when the alleged violations occurred.
Contrary to defendants' assertion, the complaint for the most part does not lump all defendants together without alleging each defendant's fraudulent conduct. The complaint lists, in painstaking detail, all forty-nine defendants and their alleged roles in the fraudulent scheme. In addition, plaintiffs allege the dates of the public offering of each Fund's securities, and the date each Fund issued its prospectus in connection with the public offering. Furthermore, plaintiffs quote extensively from the offering prospectus of each Fund and explain why they believe the statements were misleading.[15] Complaint ถถ 65-66, 68-69, 72, 92-93, 109-10, 113, 130, 132-33, 137, 154-57, 175, 177, 179, 196-97, 212-15. Therefore, plaintiffs have set forth the requisite "who, what, when, where and how" with respect to the securities fraud charges against each defendant. DiLeo v. Ernst & Young, 901 F.2d 624, 627 (7th Cir.) reh'g denied, 1990 WL 57464, 1990 U.S.App. LEXIS 9787 (1990). See also Flournoy, 701 F.Supp. at 1374-75 (finding plaintiffs' allegations of fraud sufficient); Ambling, 658 F.Supp. at 1467 (plaintiffs adequately alleged defendants' fraudulent scheme of obtaining investors in limited partnership by issuing misleading prospectus).
Similarly, defendants' objection to allegations based on information and belief are without merit as to many of plaintiffs' allegations. Plaintiffs aptly point out that in securities fraud cases where matters are *1392 particularly within the knowledge of the defendants, Rule 9(b) does not preclude pleadings of fraud on information and belief, so long as the complaint includes facts upon which the belief is based. Duane v. Altenburg, 297 F.2d 515, 518 (7th Cir.1962); Bruss Co. v. Allnet Communication Services, Inc., 606 F. Supp. 401, 405 (N.D.Ill. 1985). Plaintiffs' 184-page complaint includes a number of facts to support their allegations of fraud. However, some of plaintiffs' fraud claims are not based on factual allegations. Because application of Rule 9(b) to these information and belief pleadings overlaps with the considerations attendant to a Rule 12(b)(6) motion, the 9(b) concerns are addressed in the Rule 12(b)(6) discussion. In addition, the Rule 9(b) deficiencies regarding the RICO allegations are taken up in the Rule 12(b)(6) discussion of the RICO claims.
Defendants' contention that count nine fails to comply with Rule 9(b)'s mandate has merit. In count nine, plaintiffs assert งง 10(b) and 20(a) claims on behalf of all plaintiffs against all defendants for alleged misrepresentations and omissions in "public statements [made] during the Class Period." Count nine effectively charges each defendant with fraud in connection with all eight Funds, despite the fact that many defendants remained uninvolved with VMS Realty Partners or the Funds until quite late in the alleged fraudulent scheme. For example, the Xerox defendants did not become involved with the Funds until February 1987, when XCC became a 25 percent owner of VMS Realty Partners. Thus, the Xerox defendants cannot share liability in connection with any of the six offering prospectuses issued before February 1987. Similarly, count nine charges Prudential-Bache Securities and Prudential-Bache Properties with liability for fraud in connection with all the Funds, even though plaintiffs allege that Prudential-Bache Securities was involved with the offerings of only four of the eight Funds, and Prudential-Bache Properties in only two. In addition, many of the defendants served on the board of directors for some, but not all, of the Funds. Nevertheless, count nine charges these defendants with fraud in connection with all eight Funds.
As the foregoing examples show, count nine impermissibly lumps all defendants together and makes blanket allegations against them without alleging the place, time or substance of the fraud, much less the individual role each defendant played. Plaintiffs contend that count nine should be considered in the context of counts one through eight, which provide detailed allegations about each defendant's role in connection with a particular Fund. "Count nine," say plaintiffs, "build[s] on the details previously set forth in the fraud counts brought on behalf of each of the eight subclasses, [and] charges all defendants with having participated in a single overall fraudulent scheme." Response at 22. While this may be true, the court cannot accept the vague allegations in count nine, especially because count nine seeks to hold all defendants responsible for all alleged misrepresentations, regardless of the extent of each defendant's involvement in the misrepresentation. The court recognizes that in a fraud claim against a group of corporate insiders who acted collectively, the requirements of particularity may be relaxed, particularly when the defendants control much of the information concerning the fraud. Carter v. Signode Industries, Inc., 694 F. Supp. 493, 500 (N.D.Ill.1988). However, in this case, plaintiffs already have information as to each defendant's involvement in each of the Funds; such information is admittedly alleged in the complaint. The allegations of fraud against the various defendants in the first eight counts exhaust the extent of liability for each defendant under the 1934 Securities Exchange Act. Count nine adds nothing to the first eight counts; it merely attempts to impose liability on all defendants for all fraudulent acts. Count nine must be dismissed.
As to the remaining counts sounding in fraud, the particular Rule 9(b) objections raised by defendants lack merit. Nevertheless, the court finds that plaintiffs have failed to comply with Rule 9(b) in alleging certain elements of their fraud and RICO claims. Because the failure to adequately *1393 allege the elements of a cause of action is the focus of a motion to dismiss under Rule 12(b)(6), the Rule 9(b) deficiencies in this respect are taken up in the discussion of the motion to dismiss for failure to state a claim.
III. Rule 12(b)(6) Motion to Dismiss
Dismissal on a Rule 12(b)(6) motion is proper where it is clear that no relief could be granted under any set of facts consistent with the allegations in the complaint. Robin v. Doctors Officenters Corp., 686 F. Supp. 199, 207 (N.D.Ill.1988), citing Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S. Ct. 2229, 2232-2233, 81 L. Ed. 2d 59 (1984).
A. Securities Fraud Claims Under the 1934 Securities Exchange Act
Counts one through nine allege primary and aiding and abetting liability under ง 10(b) and Rule 10b-5, and controlling person liability pursuant to ง 20(a) of the 1934 Securities Exchange Act.[16] The second paragraph of each count lists the defendants charged with liability for conduct in connection with the particular Fund. The plaintiffs sue each particular Fund, all "controlling persons" of the Fund, the advisors and guarantors of the Fund, and the underwriters for the Fund's securities, on theories of primary liability, aiding and abetting liability, and controlling person liability.
1. Primary Liability
To establish a primary violation of ง 10(b) and Rule 5(b), plaintiffs must demonstrate that the defendants
(1) in connection with a securities transaction, (2) made an untrue statement of material fact or omitted a material fact that rendered the statements made misleading, (3) with the intent to mislead, and (4) which caused the plaintiffs' loss.
Schlifke v. Seafirst Corp., 866 F.2d 935, 943 (7th Cir.1989). The court addresses each of these four criteria separately.
a. The Transaction Requirement
It is well settled that only purchasers or sellers of securities may assert claims for securities fraud under the 1934 Act. Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 731, 95 S. Ct. 1917, 1923, 44 L. Ed. 2d 539 (1975) ("plaintiff class for purposes of ง 10(b) and Rule 10b-5 private damage actions is limited to purchasers and sellers of securities"); Norris v. Wirtz, 719 F.2d 256, 258 (7th Cir.1983), cert. denied, 466 U.S. 929, 104 S. Ct. 1713, 80 L. Ed. 2d 185 (1984); Beck v. Cantor, Fitzgerald & Co., Inc., 621 F. Supp. 1547, 1555 (N.D.Ill.1985) (rejecting liability premised upon alleged misrepresentations and omissions that occurred after plaintiff purchased his stock). While the complaint alleges that each named plaintiff purchased securities from a particular Fund, defendants are correct in observing an "egregious" defect in the complaint: plaintiffs' failure to allege specific purchase dates. Because liability under ง 10(b) and Rule 10b-5 must be premised on plaintiffs' reliance on misrepresentations in purchasing the Funds' securities, the dates of purchase are essential to their claim. Without purchase dates, it is impossible to determine whether certain investors could have purchased their securities "in connection with" the alleged misrepresentations contained in the eight offering prospectuses, the Forms 10-K and 10-Q for each Fund, and the year-end shareholder reports for each Fund. It is also impossible to determine whether the 1934 Act claims are barred by the statute of limitations, which expires three years after the sale of the security, without exception. Thus, the court must dismiss the claims of all plaintiffs who failed to provide any references to when they made their investments in a particular Fund.[17]
*1394 The only indication of purchase dates for any plaintiff is found in the complaint's allegations that some plaintiffs invested in a particular Fund during the Fund's initial public offering. At that time, the only documents these plaintiffs could have relied on were the offering prospectuses. Thus, the court must limit its consideration of plaintiffs' 1934 Act claims to the statements made in the prospectuses. Any misleading statements in subsequent documents, such as annual shareholder reports or Forms 10-k and 10-Q are not relevant to plaintiffs' securities fraud claims because the statements were not made "in connection with" a purchase or sale of securities.
b. Material Misrepresentations or Omissions
For every defendant charged with primary liability under ง 10(b) and Rule 10b-5, plaintiffs must establish that he or she made misrepresentations or omissions of material fact. Plaintiffs allege primary liability against the Funds, the Funds' officers, directors, trustees, underwriters, guarantors, advisors and appraisers. In addition, plaintiffs charge various defendants with primary liability because of their association with VMS Realty Partners. Plaintiffs' dragnet approach to establishing liability must be stopped short at this point, because the vast majority of the forty-nine defendants could not possibly be primary violators. All of the alleged misleading statements were issued by the eight Funds. The guarantors, underwriters, advisors and appraisers were not responsible for issuing the prospectuses or any other alleged misleading document.[18] Thus, the only defendants who could conceivably be charged with primary liability are the Funds, and certain "controlling persons."[19]DiLeo, 901 F.2d at 626-28.
The Seventh Circuit explained in Rowe v. Maremont Corp., 850 F.2d 1226, 1223 (7th Cir.1988) that "an omission or misstatement is material under Rule 10b-5 if it is substantially likely that a reasonable investor would have viewed the omitted or misstated fact as significantly altering the `total mix' of information made available." Id., quoting Basic Inc. v. Levinson, 485 U.S. 224, 231-32, 108 S. Ct. 978, 983, 99 L. Ed. 2d 194 (1988). Plaintiffs' allegations essentially fall into four different categories of misleading statements.[20] First, plaintiffs claim that the prospectuses misled investors into believing that the Funds' securities were a "safe" or "conservative" investment. Although a review of the prospectuses[21] reveals no express assurances of conservatism, the prospectuses do contain various statements that plaintiffs contend imply a low-risk venture. For example, each of the prospectuses describes the *1395 Fund's primary objectives as preserving the Fund's capital and providing quarterly distributions to stockholders. Complaint ถถ 66, 93, 110, 132, 155, 177, 197, 212. In addition, the prospectuses assure investors that various entities will guarantee the Funds' investments and cash flow. Complaint ถถ 66, 93, 197, 212.
Defendants do not debate the notion that mischaracterizations of risk may constitute misrepresentations of material fact. Bastian v. Petren Resources Corp., 892 F.2d 680, 685-86 (7th Cir.), cert. denied, ___ U.S. ___, 110 S. Ct. 2590, 110 L. Ed. 2d 270 (1990). Cf. Fisher v. Samuels, 691 F. Supp. 63, 69 (N.D.Ill.1988). Defendants argue that even if plaintiffs could draw an inference of "safety" from snippets of the prospectuses, any such inference is thoroughly dispelled by the prospectuses' extensive disclosures concerning inherent risks. Defendants ask this court to determine, on a motion to dismiss, that the prospectuses adequately disclosed the risks as a matter of law.
In Acme Propane, Inc. v. Tenexco, Inc., 844 F.2d 1317 (7th Cir.1988), the Seventh Circuit affirmed the dismissal of certain securities fraud claims because the defendants had adequately disclosed the nature of the investment in a document provided to the plaintiffs before they made their investment. In Acme Propane, the plaintiffs claimed the defendants made misleading oral statements to them regarding the productivity of certain oil wells. However, accurate productivity information was disclosed in a written "Reserve Estimate" given to plaintiffs prior to their investment. The district court determined that some of defendants' deceitful oral statements were not material to the investment decision because the plaintiffs were told the truth before investing. The Seventh Circuit upheld the district court's Rule 12(b)(6) dismissal of some of the securities fraud claims, based on defendants' written disclosure. The Seventh Circuit noted, however, that "the need to deter deceit, both oral and written, ... [requires] that the written words be true, clear, and complete, in order to be dispositive."[22]Id. at 1325.
The court finds the Acme Propane reasoning applies to the present case. In the prospectuses, defendants adequately disclaimed any promises that the Funds' securities were a safe or conservative investment. Each Fund's prospectus begins with a preliminary disclosure of the nature of the risks involved:
THIS OFFERING INVOLVES CERTAIN RISKS AND CONFLICTS OF INTEREST, including conflicts of interest inherent in each and every transaction into which the Fund intends to enter with Affiliated Borrowers; economic risks relating to the ability of Borrowers to repay the [l]oans; risks associated with mortgage investments in real estate; risks of ownership of real property; the risk that VMS Financial Guarantee Limited Partnership (the "Guarantor") may not be able to honor its guarantees to the Fund; the inability of prospective investors to evaluate specific investments; the possible inability of the Fund promptly to invest and reinvest its assets in [l]oans or [r]eal [p]roperty on favorable terms; the possible concentration in the type and number of investments; the payment of certain fees to the Advisor and its Affiliates; ... federal income tax risks; and various other risks. See "Conflicts of Interest," "Risk Factors" and "Income Tax Consequences."
MIF prospectus at 2. See also prospectuses of: the Income Trust at 1; MILP I at 1; MILP II at 1; MILP III at 1; the Hotel Fund at 2; the Land Trust at 2; Land Fund II at 3. In addition, each prospectus contains a more detailed risk disclosure about inherent conflicts of interest, and the possibility that the guarantors would be unable to honor their guarantees.[23] As to the prospectuses' declared objectives to "preserve *1396 and protect the [Fund's] capital," and to "provide for quarterly cash distributions," each and every prospectus states that "[t]here can be no assurance that [the Fund's] objectives will be attained."[24] Furthermore, regarding the assurance at page 3 of the Income Trust's prospectus that the Fund would "utilize the services of unaffiliated MAI real estate appraisers in determining whether to make short term loans," the prospectus stated at page 9 that
appraisals and/or preliminary valuation letters are merely opinions by individuals as to the value of real property.... There will be no assurance that [property securing a loan] could be resold or refinanced at its appraised value.
The foregoing disclosures are clear and unambiguous. Thus, none of the paragraphs to which plaintiffs refer supports a reasonable inference that the prospectuses misrepresented the Funds as safe or conservative investments. Moreover, nowhere in the prospectuses can one find an express assurance that an investment in a Fund would be "safe" or "conservative." Hence, plaintiffs have failed to properly allege that the prospectuses contained affirmative misrepresentations of material fact concerning the Funds' risks.
Second, plaintiffs allege that the prospectuses failed to apprise potential investors of the extent to which the Funds depended on VMS Realty Partners. According to plaintiffs, VMS Realty Partners routinely advanced money to the Funds' borrowers so that the borrowers would be able to make their loan payments to the Funds. Plaintiffs argue that this somewhat incestuous financial arrangement should have been disclosed to potential investors in the prospectuses. In the first place, the court notes that the prospectus for each Fund was issued and the securities were sold before each Fund made any loans to borrowers. Nevertheless, plaintiffs advance the palpable theory that after the first Fund had been operating for some time, defendants should have been on notice that subsequent Funds would make loans to borrowers who relied on VMS Realty Partners for financial assistance. Thus, argue plaintiffs, each offering prospectus should have reflected anticipation that VMS Realty Partners would provide subsidies to the Fund's borrowers. For several reasons, the court does not agree.
Liability under ง 10(b) and Rule 10b-5 does not attach to omissions absent a duty to disclose. Schlifke v. Seafirst Corp., 866 F.2d 935, 944 (7th Cir.1989). A duty to disclose arises in two ways. Incomplete disclosures or half-truths give rise to a duty to disclose whatever additional information is necessary to rectify misleading statements. Id. In addition, a duty to disclose may be triggered by a fiduciary-type relationship, even absent any misleading statements. Id. It is well established that a seller of securities owes no fiduciary duty to a prospective purchaser. Ambrosino, 635 F.Supp. at 973. Thus, any duty to disclose VMS Realty Partners' alleged practice of subsidizing the Funds' borrowers must stem from incomplete disclosures in the prospectuses that would render the prospectuses misleading without further disclosure.
The prospectuses advise investors that the Funds' success depends largely on the ability of borrowers to meet their loan obligations. Plaintiffs argue that this disclosure is misleading without further informing investors that VMS Realty Partners would regularly advance money to the borrowers. However, defendants correctly assert that VMS Realty Partners' subsidies did not in any way make the Funds' securities more risky. To the contrary, the policy of subsidizing borrowers provided less risk to the Funds, as they were more likely to collect payment from borrowers. Thus, the failure to disclose this practice could not have caused investors to underestimate the level of risk involved. Under the Rowe standard, the omissions were not materially *1397 misleading and defendants had no duty to disclose them.
Third, plaintiffs charge defendants with failing to disclose the Funds' practice of making loans secured by overleveraged properties. The Funds' prospectuses state that loans to affiliated borrowers would be on terms approximating those of arm'slength transactions, or would be as favorable to the Fund as loans to an unaffiliated borrower in similar circumstances. Complaint ถถ 66, 110, 132, 155, 177, 212. Plaintiffs allege that in violation of these promises, the Funds routinely made loans secured by overcollateralized properties. Plaintiffs contend that the annual reports and other documents issued subsequent to the prospectus were materially misleading because they did not disclose the overleveraged loans.
In the foregoing discussion on the transaction requirement, the court explained that plaintiffs cannot base their securities fraud claims on these subsequent documents. In any event, plaintiffs' allegations of overleveraging fail to meet Rule 9(b)'s requirement of particularity. Except for the Income Trust (ถ 92) and MILP I (ถ 109), plaintiffs simply recite the allegation that the prospectuses for the Funds were materially misleading because
VMS Realty Partners and its affiliates, including the ... Funds, repeatedly engaged in a practice of making loans on properties where the aggregate amount of financing greatly exceeded the value of the property.
Complaint ถ 130. See also ถถ 65, 154, 175, 196, 212. Plaintiffs make these conclusory allegations on information and belief, yet fail to support them with allegations of fact, as required by Rule 9(b). Duane v. Altenburg, 297 F.2d 515, 518 (7th Cir.1962); Bruss Co. v. Allnet Communication Services, Inc., 606 F. Supp. 401, 405 (N.D.Ill. 1985). Therefore, as to all of the Funds except MILP I and the Income Trust, plaintiffs have failed to allege overleveraging with specificity under Rule 9(b).
Despite compliance with the particularity requirement of Rule 9(b), the allegations of overleveraged loans for the Income Trust and MILP I do not support plaintiffs' claims that the prospectuses misrepresented material facts. The prospectuses merely promise that the Funds' loans will approximate arm's-length transactions or contain favorable terms. As Judge Shadur explained, "expressions of opinion and promises or predictions of future fact ordinarily cannot ground fraud charges." SFM Corp. v. Sundstrand Corp., 99 F.R.D. 101, 105 (N.D.Ill.1983).
Finally, plaintiffs maintain that the prospectuses should have disclosed that the Funds engaged in loan churning, and that VMS Realty Partners thereby engaged in a Ponzi, or pyramiding, scheme to keep creating new Funds in order to bail out failing borrowers of existing Funds.[25] Defendants are correct in observing that allegations of loan churning are properly viewed as charges of breach of fiduciary duty and mismanagement. It is well established that investors cannot recover under ง 10(b) and Rule 10b-5 for breach of fiduciary duty. Santa Fe Indus., Inc. v. Green, 430 U.S. 462, 97 S. Ct. 1292, 51 L. Ed. 2d 480 (1977); DiLeo, 901 F.2d at 627. Nor can plaintiffs make out a securities fraud claim by alleging that defendants failed to disclose their intent to breach fiduciary duties:
courts have consistently held that since a shareholder cannot recover under 10b-5 for a breach of fiduciary duty, neither can he "bootstrap" such a claim into a federal securities action by alleging that the disclosure philosophy of the statute obligates defendants to reveal either the culpability of their activities, or their impure motives for entering the allegedly improper transaction. *1398 Panter v. Marshall Field & Co., 646 F.2d 271, 288 (7th Cir.), cert. denied, 454 U.S. 1092, 102 S. Ct. 658, 70 L. Ed. 2d 631 (1981).
In sum, plaintiffs' allegations do not amount to misrepresentations of material fact.
c. Scienter
In order to satisfy the scienter requirement, plaintiffs must adequately allege that defendants misrepresented the nature of the risks with the "intent to deceive, manipulate, or defraud." Ernst & Ernst v. Hochfelder, 425 U.S. 185, 193, 96 S. Ct. 1375, 1381, 47 L. Ed. 2d 668 (1976); Schlifke, 866 F.2d at 946. Allegations of recklessness are sufficient to meet this standard. Id.; Rankow v. First Chicago Corp., 870 F.2d 356, 367 (7th Cir.1989).
The court has already determined that the Funds' advisors, appraisers, guarantors and underwriters cannot properly be charged with primary liability under ง 10(b) and Rule 10b-5. The scienter element for these defendants is addressed in the discussion of aiding and abetting liability. As to the remaining defendantsโthe Funds and their officers, directors and trustees, and VMS Realty Partners and its affiliatesโthe complaint adequately alleges scienter.[26] For each count charging violations of ง 10(b) and Rule 10b-5, plaintiffs recite the same allegation as to state of mind:
Those defendants on this count who are the principals in VMS Realty Partners, the companies through which VMS Realty Partners was controlled by its principals, and VMS Realty Partners itself, together with ... members of senior management of VMS Realty Partners and its affiliates or who were involved in the management of the Fund knew or recklessly disregarded the materially misleading nature of the documents issued by the Fund during the Class Period.... Similarly, the directors of the Fund who are not members of management recklessly or intentionally acquiesced in the gross overleveraging [and other breaches of fiduciary duty].... Th[e]se defendants drafted and approved, and/or controlled persons who drafted and approved, the materially misleading communications by or on behalf of the Fund....
Complaint ถถ 80-81, 100-101, 121-22, 145-46, 166-67, 187-88, 204-05, 222-23 (emphasis added). Rule 9(b) allows state of mind to be pleaded generally, as long as the circumstances of the deception are stated with particularity. DiLeo, 901 F.2d at 627. Plaintiffs have alleged the roles of these defendants and the extent to which they were involved with the operation and management of the Funds. They also allege that VMS Realty Partners, its principals and its affiliates, earned millions of dollars in fees from the Funds. These allegations are sufficient, at this stage of the litigation, to provide a basis for a reasonable inference that the defendants at least acted recklessly. In Rankow, the Seventh Circuit observed that
to determine whether the conduct involved in this case is reckless or negligent requires a more detailed inquiry into the facts, one which is not appropriateโor, indeed, possibleโon the complaint alone.
870 F.2d at 367. The court adopts the reasoning set forth in Rankow. At this preliminary stage, plaintiffs have alleged scienter with adequate specificity.
d. Causation
Plaintiffs must allege both "transaction causation" and "loss causation" in order to make out a ง 10(b) and Rule 10b-5 claim. LHLC Corp. v. Cluett, Peabody & Co., Inc., 842 F.2d 928, 931 (7th Cir.), cert. denied, 488 U.S. 926, 109 S. Ct. 311, 102 L. Ed. 2d 329 (1988). To establish "transaction causation," plaintiffs must allege that they would not have purchased the securities had the defendants made truthful *1399 statements at the time required. Id. "Loss causation" presents a more difficult burden for plaintiffs. They must allege that they would not have suffered a loss on their investment if the facts were as they believed them to be at the time they purchased the securities. Id. Defendants do not question the adequacy of plaintiffs' allegations regarding transaction causation. However, defendants argue that, in light of the Seventh Circuit's recent opinion in Bastian v. Petren Resources Corp., 892 F.2d 680 (7th Cir.), cert. denied, ___ U.S. ___, 110 S. Ct. 2590, 110 L. Ed. 2d 270 (1990), plaintiffs fail to adequately allege loss causation.
In Bastian, the plaintiffs invested in oil and gas limited partnerships promoted by the defendants in 1981. By 1984, the limited partnerships were worthless. The plaintiffs in Bastian claimed that they were induced to invest by the offering memoranda, which allegedly misrepresented the defendants' competence and integrity. The Bastian court rejected the plaintiffs' argument that they need only allege that misrepresentations caused them to invest in the limited partnerships, and that the limited partnerships subsequently became worthless. The court found the plaintiffs' allegations insufficient because "[t]hey have alleged the cause of their entering into the transaction in which they lost money but not the cause of the transaction's turning out to be a losing one." Id. at 684. The court noted that the steady decline of oil prices after 1981 could easily have caused the plaintiffs' loss, regardless of the defendants' alleged misrepresentations. Id.
In the present case, plaintiffs allege that the Funds were mismanaged and operated for the benefit of VMS Realty Partners and its affiliates. Unlike the plaintiffs in Bastian, they do not say that "they have no idea why their investment was wiped out and it does not matter." Id. at 683. Therefore, plaintiffs have adequately alleged loss causation as interpreted in Bastian.
2. Controlling Person Liability
A sundry of defendants are labelled "controlling persons" of the Funds and are charged with liability for misrepresentations under ง 20(a) of the 1934 Securities Exchange Act. Section 20(a) provides, in relevant part:
Every person who, directly or indirectly, controls any person liable under any provision of this title or of any rule or regulation thereunder shall also be liable jointly and severally with and to the same extent as such controlled person is liable, unless the controlling person acted in good faith and did not directly or indirectly induce the act or acts constituting the violation or cause of action.
15 U.S.C. ง 78t. The Seventh Circuit has yet to adopt a firm standard for determining when "controlling person" liability may be imposed. However, the Seventh Circuit has endorsed a two-prong test as the minimum threshold requirement for establishing controlling person liability. Schlifke, 866 F.2d at 949. Under this test, plaintiffs must establish (1) that the "controlling person" actually participated in the operations of the controlled person or entity, and (2) that the "controlling person" actually possessed the power to control the specific transaction or activity upon which the primary violation is premised. Id. Under this threshold test, it is clear that the underwriters, guarantors, advisors and appraisers cannot be liable under ง 10(b) as controlling persons. Plaintiffs have not alleged facts to indicate that any of these defendants had the authority to control the operation of the Funds. See Schlifke, where a bank that financed a limited partnership's oil and gas exploration program and whose loan documents were included in the partnership prospectus did not qualify as "controlling person."
In addition, plaintiffs improperly charge XCC, Xerox Credit Corporation, Xerox Financial Services, and Melvin Howard with controlling person liability for securities fraud regarding all the Funds. XCC did not acquire its interest in VMS Realty Partners until February 1987. Therefore, XCC and the other Xerox defendants could not *1400 possibly have possessed authority to control any of the Funds prior to February 1987. Thus, the Xerox defendants cannot be liable as controlling persons with respect to those prospectuses that circulated before February 1987: the Income Trust, MILP I, MILP II, the Hotel Fund and the Land Trust.
Regarding the Funds, VMS Realty Partners, and the directors, officers and trustees of these entities, plaintiffs have sufficiently alleged controlling person liability under the threshold test. However, defendants urge this court to adopt the Ninth Circuit's more stringent test requiring that these defendants be "culpable participants" in the alleged illegal activity. Orloff v. Allman, 819 F.2d 904, 906 (9th Cir.1987). Although the Seventh Circuit in Schlifke reserved ruling on this issue, defendants point out that judges of this district have required "culpable participation" in the alleged wrongdoing. Beck v. Cantor, Fitzgerald & Co., Inc., 621 F. Supp. 1547, 1564 n. 20 (N.D.Ill.1985) (Rovner, J.) ("mere titles are not adequate indicators of authority") quoting Hudson v. Capital Management International, Inc., [1982-83 Transfer Binder] Fed.Sec.L.Rep. (CCH) ถ 99,222 at 95, 905, 1982 WL 1385 (N.D.Cal. Aug. 24, 1982); Kennedy v. Nicastro, 503 F. Supp. 1116, 1121 (N.D.Ill.1980) (Shadur J.).[27] The requirement of "culpable conduct" seems in keeping with the Supreme Court's view that people may be liable under ง 10(b) only if they act with intent to deceive. Ernst & Ernst, supra; Barker v. Henderson, Franklin, Starnes & Holt, 797 F.2d 490, 495 (7th Cir.1986). This more stringent requirement also ensures that secondary liability "does not sweep up all people who can be characterized as participants in or contributors to the success of the firm that issues the securities." Barker, 797 F.2d at 495. For these reasons, the court requires plaintiffs to allege facts indicating culpable conduct on the part of those defendants charged with controlling person liability. Plaintiffs may amend their complaint to conform with the three requirements of controlling person liability discussed here.
3. Aiding and Abetting Liability
The Seventh Circuit recognizes a cause of action for aiding and abetting violations of ง 10(b) and Rule 10b-5. Robin v. Arthur Young & Co., 915 F.2d 1120 (7th Cir.1990); DiLeo, 901 F.2d at 628. Recently, however, the Seventh Circuit has questioned the propriety of imposing liability on aiders and abettors. Arthur Young, at 1123; DiLeo, 901 F.2d at 628. In light of this skepticism, the Seventh Circuit has imposed stringent standards for aiding and abetting liability. To hold someone liable for aiding and abetting, the Seventh Circuit requires at a minimum that the alleged aider and abettor
(1) commit one of the manipulative or deceptive acts prohibited under section 10(b) and rule 10b-5, (2) with the same degree of scienter that primary liability requires.
Arthur Young, at 1123; Renovitch v. Kaufman, 905 F.2d 1040, 1045 (7th Cir. 1990). The alleged aider, abettor or conspirator need not have offered or sold the security in order to be held liable. However, mere knowledge of a material omission is not enough to violate Rule 10b-5 absent a duty to disclose. Barker, 797 F.2d at 495.
The foregoing analysis compels a conclusion that plaintiffs have failed to sufficiently plead material misrepresentations essential to a violation of ง 10(b) and Rule 10b-5. This deficiency precludes recovery for aiding and abetting liability. Thus, the complaint fails to meet the first requirement for aiding and abetting liability.
*1401 The court need not engage in an elaborate discussion of the numerous inadequacies inherent in plaintiffs' attempt to plead scienter on the part of many of the aiders and abettors. The court need only note that plaintiffs cannot evade the requirements of Rule 9(b) by pleading conclusory allegations of knowledge or reckless disregard of misleading statements. As the Seventh Circuit explained in DiLeo, boilerplate allegations of intent and knowledge are insufficient. DiLeo, 901 F.2d at 629. There must be some basis in the complaint for believing that plaintiffs could prove scienter. Id.; Arthur Young, at 1127. Plaintiffs have failed to do this regarding the allegations directed at the advisors, appraisers, guarantors and underwriters who are not directly affiliated with VMS Realty Partners or the Funds. Plaintiffs fail to allege that these independent defendants had anything to gain from any fraud by the primary violators. Allegations that these defendants accepted large fees for their services will not suffice to support an inference of scienter. Arthur Young, at 1127; DiLeo, 901 F.2d at 629. The Seventh Circuit has twice acknowledged that the potential injury to a defendant's reputation for integrity far outweighs any possible gain from retaining a client. Arthur Young, at 1127; DiLeo, 901 F.2d at 629 ("An accountant's greatest asset is its reputation for honesty, followed closely by its reputation for careful work. Fees ... could not approach the losses [the accounting firm] would suffer from a perception that it would muffle a client's fraud.").
In sum, plaintiffs fail to properly allege aiding and abetting liability. In order to state a claim for aiding and abetting liability, plaintiffs must first allege material misrepresentations or omissions that defendants had a duty to disclose. Second, plaintiffs must plead scienter in conformance with the principles set forth above.
B. The 1933 Securities Act Claims
Plaintiffs charge various defendants with violating Sections 11, 12(2) and 15 of the 1933 Securities Act. Defendants move to dismiss all of these claims under Rule 12(b)(6).
1. Section 11
Counts ten and eleven assert liability under ง 11 and are directed at the registration statements and accompanying prospectuses of MIF and Land Fund II, respectively. Section eleven imposes liability if
... any part of the registration statement, when such part became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading....
15 U.S.C. ง 77k. Pursuant to ง 11, purchasers of securities may sue the issuer, its directors or partners, underwriters, and accountants or appraisers who are named as having prepared or certified the registration statement. Id; Herman & MacLean v. Huddleston, 459 U.S. 375, 382 n. 13, 103 S. Ct. 683, 687 n. 13, 74 L. Ed. 2d 548 (1983). Plaintiffs need not allege scienter to make out a ง 11 claim. Id. at 382, 103 S.Ct. at 687; Wielgos v. Commonwealth Edison Co., 688 F. Supp. 331, 335 (N.D.Ill.1988).
The analysis of plaintiffs' allegations concerning misleading statements and omissions in the prospectuses under the 1934 Securities Exchange Act applies equally here. For the reasons stated in that portion of this opinion, plaintiffs have failed to allege actionable misrepresentations or omissions of material fact under ง 11.
2. Section 12(2)
Section 12(2) imposes liability on "any person who"
offers or sells a security ... by means of a prospectus or oral communication, which includes an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements, in the light of the circumstances under which they were made, not misleading....
15 U.S.C. ง 77l(2). Plaintiffs' claims under ง 12(2) are insufficient for the same reason described in the immediately preceding section on liability under ง 11.
*1402 3. Section 15
Defendants are correct in noting that there is no cause of action for aiding and abetting violations of the 1933 Securities Act. Schlifke, 866 F.2d at 942. However, plaintiffs have not charged defendants with aiding and abetting liability under ง 11 and 12(2). Plaintiffs charge the various defendants in counts ten through fourteen with either primary liability or "controlling person" liability pursuant to ง 15. Under ง 15,
[e]very person who, by or through stock ownership, agency, or otherwise, ... controls any person liable under sections 77k [ง 11] or 771 [ง 12] of this title, shall also be liable jointly and severally with and to the same extent as such controlled person ... unless the controlling person had no knowledge of or reasonable ground to believe in the existence of the facts by reason of which the liability of the controlled person is alleged to exist.
15 U.S.C. ง 77o. Notwithstanding the fact that there can be no controlling person liability without a primary violation, other defects in the complaint preclude charging several of the named defendants with controlling person liability. The court adopts the same analysis for controlling liability under both the 1933 and 1934 Securities Acts.[28] Thus, the deficiencies pointed out in the analysis of controlling person liability under ง 20(a) of the 1934 Act render plaintiffs' claims under ง 15 of the 1933 Act flawed in the same respect. Should plaintiffs file an amended complaint, it must allege facts to support controlling person liability in accordance with the three requirements set forth in this opinion's discussion of controlling person liability under ง 20(a).
C. RICO Claims
In count forty, plaintiffs attempt to heap RICO violations on top of their already bulging arsenal of charges against defendants. Count forty charges all defendants with violating RICO, 18 U.S.C. ง 1962(a), (b), and (c).[29] This count must be dismissed on Rule 9(b) grounds and for failure to state a claim under Rule 12(b)(6).
1. Rule 9(b)
The requirement that fraud must be alleged with particularity applies to fraud claims that serve as predicate acts for a RICO claim. Huang v. Shiu, 124 F.R.D. 175, 177 (N.D.Ill.1988), citing Ray v. Karris, 780 F.2d 636, 644-45 (7th Cir.1985). Plaintiffs base their RICO claims on securities fraud, mail fraud, and wire fraud violations. The Rule 9(b) deficiencies concerning the securities fraud claims are discussed previously in this opinion. Because the securities fraud claims are dismissed on several grounds, the court limits its inquiry to the mail and wire fraud violations. The law of this district is well settled; Rule 9(b) requires plaintiffs to allege "who (i.e., which defendant) caused what to be mailed when, and how that mailing furthered the fraudulent scheme." Hinsdale Women's Clinic, S.C. v. Women's Health Care, 690 F. Supp. 658, 662 (N.D.Ill.1988), quoting Ghouth v. Conticommodity Services, Inc., 642 F. Supp. 1325, 1331-32 (N.D.Ill.1986) (emphasis in original). Plaintiffs' allegations of mail and wire fraud consist of the following:
*1403 Its [sic] acts of mail fraud include its use of the United States mails for the purpose of disseminating information relating to the Funds, in order to induce persons to purchase the Funds' securities. Its acts of wire fraud include its use of the instrumentalities of telephonic communication in connection with the sale of the Funds' securities.
Complaint ถ 358. The court notes that "it is not the function of this [c]ourt to educate plaintiff[s'] attorneys as to how to plead fraud with particularity." Huang, 124 F.R.D. at 177. Suffice it to say that the complaint's vague allegations of the use of the mails and telephones do not come close to satisfying Rule 9(b).
2. Rule 12(b)(6)
Even if plaintiffs had alleged fraud with particularity, plaintiffs' RICO claims under ง 1962(b) and (c) must be dismissed because plaintiffs have not pleaded the essential elements. In addition, the ง 1962(a) claim must be dismissed as to many of the defendants. Plaintiffs allege that all of the named defendants, together with other entities affiliated with VMS Realty Partners, acted in association with one another and constituted an "enterprise" (the "VMS enterprise") as that term is defined under 18 U.S.C. ง 1961(4).[30] Complaint ถ 357. The language of ง 1962(c) indicates it was intended to govern only those situations in which the enterprise was the passive, innocent victim of racketeering. Liquid Air Corp. v. Rogers, 834 F.2d 1297, 1306 (7th Cir.1987), cert. denied, ___ U.S. ___, 109 S. Ct. 3241, 106 L. Ed. 2d 588 (1989). Thus, in order to make out a RICO violation under ง 1962(c), the "person" who commits the predicate acts of racketeering must be separate from the "enterprise." Liquid Air, 834 F.2d at 1306; Haroco, Inc. v. American Nat. Bank & Trust Co., 747 F.2d 384 (7th Cir.1984), cert. granted, 469 U.S. 1157, 105 S. Ct. 902, 83 L. Ed. 2d 917 aff'd, 473 U.S. 606, 105 S. Ct. 3291, 87 L. Ed. 2d 437 (1985). Because plaintiffs have not alleged that defendants are distinct from the enterprise, plaintiffs' RICO claim under ง 1962(c) must be dismissed.
Plaintiffs' claim under ง 1962(a) does not suffer from the same deficiency as the ง 1962(c) claim. In Liquid Air, the Seventh Circuit determined that, unlike ง 1962(c),
there [is] nothing in the language of subsection (a) that seem[s] to require that the liable "person" be a distinct entity from the "enterprise." In other words, subsection (a), by its express language, encompassed circumstances under which the enterprise itself was guilty of wrongdoing.
Liquid Air, 834 F.2d at 1306. Assuming plaintiffs could allege the requisite racketeering activity, which at this point they have failed to do, plaintiffs would make out a claim for violation of ง 1962(a) only if they established that defendants used income derived from a pattern of racketeering activity to operate or maintain the VMS enterprise. At this juncture, it is worthwhile to point out that plaintiffs have not alleged facts that would support a reasonable inference that all defendants stood in a position to operate or maintain the VMS enterprise, much less that these defendants actually exercised such authority.
Finally, plaintiffs' allegations regarding violations of ง 1962(b) are misplaced and border on the frivolous. Congress enacted ง 1962(b) with the purpose of prohibiting the takeover of legitimate businesses through racketeering, typically extortion or loansharking. D. Smith and T. Reed, Civil Rico, ถ 5.01 (1990). In order to establish liability under ง 1962(b), plaintiffs must allege that defendants' racketeering activity caused โ or at least facilitated โ defendants' acquisition or maintenance of an interest in or control of the VMS enterprise. Capalbo v. PaineWebber, Inc., 694 F. Supp. 1315, 1319-1320 (N.D.Ill.1988). Plaintiffs' allegations under ง 1962 are limited to the following statement:
[T]hrough the aforesaid pattern of racketeering activity, defendants have acquired *1404 and maintained their interest in and control of the VMS Enterprise and have conducted and/or participated in the conduct of the affairs of the VMS Enterprise.
Complaint ถ 360. Aside from the Rule 9(b) problems inherent in this conclusory statement, this allegation does not assert that defendants engaged in the alleged pattern of racketeering activity in order to acquire or maintain control of the VMS empire. Indeed, the complaint is devoid of any factual allegations which could support such an inference. Plaintiffs' ง 1962(b) claim is dismissed.[31]
D. Common Law Claims
Because all of plaintiffs' federal claims must be dismissed on several grounds, this court declines to reach the issues posed by the pendent state law claims in counts fifteen through thirty-nine. United Mine Workers v. Gibbs, 383 U.S. 715, 86 S. Ct. 1130, 16 L. Ed. 2d 218 (1966). See also Beck, 621 F.Supp. at 1564 (in securities fraud class action where federal securities fraud claims were dismissed, court declined to consider state law claims until the filing of the second amended complaint).
IV. Defendants' Motion to Strike Plaintiffs' Request For Punitive Damages
Plaintiffs submit a single prayer for relief covering all forty counts of their complaint. In their prayer for relief, plaintiffs make a general request for punitive damages. Defendants ask this court to strike the claim for punitive damages except as to the common law fraud claims. Plaintiffs make no argument in opposition to this request.
The federal securities laws do not provide for recovery of punitive damages. Ambrosino, 635 F.Supp. at 972. In addition, punitive damages may not be awarded in negligence cases. Galayda v. Penman, 80 Ill.App.3d 423, 35 Ill. Dec. 590, 595, 399 N.E.2d 656, 661 (1980). As to the RICO claims, the treble damages provisions define the extent of possible recovery. Southwest Marine, Inc. v. Triple A Machine Shop, Inc., 720 F. Supp. 805, 810 (N.D.Cal.1989) ("civil remedy provisions of RICO ... provide treble damages which are themselves punitive in character"). Hence, defendants' motion to strike plaintiffs' request for punitive damages is granted except as to the common law fraud claims.
CONCLUSION
For the foregoing reasons, the court dismisses the consolidated complaint. Because the statute of limitations presents an absolute bar to counts four and six, these counts are dismissed with prejudice. Count nine is also dismissed with prejudice. The remaining counts are dismissed without prejudice. In order to insure that any future amended complaint does not reiterate the extensive problems identified in this opinion, the court summarizes the deficiencies.
1. Plaintiffs must allege their precise dates of purchase. Should plaintiffs fail to do so, the court will dismiss with prejudice the claims of all plaintiffs who have not specified when they purchased their securities. However, if plaintiffs amend their complaint to allege purchase dates after the initial public offerings, the court will consider whether documents issued by the Funds after the initial public offerings contain misrepresentations or omissions of material fact.
2. In order to comply with the statute of limitations, plaintiffs must plead facts showing (a) that they purchased securities within three years of January 11, 1990, and (b) that equitable tolling forestalls the one-year period of limitations for all plaintiffs who purchased their securities more than one year before November 14, 1989.
*1405 3. For each count, plaintiffs must specifically identify the defendants charged. Plaintiffs are directed not to charge defendants with misrepresentations with which they could not possibly have been connected, i.e., the Xerox defendants prior to February 1987.
4. For all federal securities fraud claims, plaintiffs must allege misrepresentations and omissions of material fact. Plaintiffs must also clarify which defendants are charged with primary, aiding and abetting, and controlling person liability.
5. Plaintiffs' allegations of controlling person liability under the 1933 and 1934 Securities Acts must comply with the standards set forth in this opinion.
6. All claims of aiding and abetting liability under the 1934 Act must allege misrepresentations of material fact and scienter.
7. Plaintiffs must correct all substantive and pleading defects in the RICO claims.
ON MOTION FOR RECONSIDERATION
On October 19, 1990, the court dismissed plaintiffs' consolidated class action complaint. Counts four, six and nine were dismissed with prejudice. Plaintiffs now move for reconsideration, and request leave to replead counts four, six and nine.
Counts four and six assert claims, on behalf of purchasers of MILP II and Hotel Fund securities, for violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. The court dismissed these claims with prejudice because, based on the allegations of the consolidated complaint, certain plaintiffs had clearly purchased securities of MILP II and the Hotel Fund more than three years before the filing of the first class action naming all of the VMS funds as defendants on January 11, 1990. Upon reconsideration, the court notes that several named plaintiffs representing the Hotel Fund and MILP II subclasses did not allege any purchase dates. As to these plaintiffs, the court could not determine whether the three-year statute of limitations precludes their federal securities fraud claims. The court's October 19, 1990 order granted plaintiffs of other subclasses leave to allege their dates of purchase in order to show compliance with the statute of limitations. The court now grants plaintiffs' motion for leave to plead the purchase dates of those plaintiffs representing the Hotel Fund and MILP II subclasses, for whom the consolidated complaint failed to identify when their securities were purchased. Those plaintiffs are: Walter D. Ford, Sr.; John E. Holcomb; Paul J. Isaac; Mary Maganos; Quaker Valley Meats, Inc. Pension Plan UDT 11/1/83, Norman Fleekop, Trustee; Bertrand Sellier; and Judith Ludwig.
The court will not, however, reconsider the claims of those plaintiffs who clearly purchased their Hotel Fund and MILP II securities more than three years before January 11, 1990. The claims of David Robbins, Atlantic Electric Supply Corp. Pension Plan, John and Ilana Falco (regarding MILP II), and Marie Matson (regarding the Hotel Fund) remain dismissed with prejudice.
As to count nine, the court dismissed that claim because the allegations were impermissibly vague, in violation of Federal Rule of Civil Procedure 9(b). This dismissal should have been without prejudice. Plaintiffs' motion to replead count nine to conform with Rule 9(b) is granted.
NOTES
[1] The plaintiff class has not yet been certified. Briefing on plaintiffs' motion for class certification has been stayed on the court's own motion.
[2] On October 11, 1990, while this motion to dismiss was pending, plaintiffs voluntarily dismissed without prejudice defendants Gary A. Rosenberg and Robert Wislow.
[3] XCC acquired its 25% interest in VMS Realty Partners in February 1987 for $70 million. Complaint ถ 13(y). V/M/S has been a general partner since 1986. Complaint ถ 13(qq). Residential Equities and Brewster have been general partners throughout the class period. Complaint ถถ 13(rr, ss).
[4] Those plaintiffs are: Walter D. Ford, Sr.; John E. Holcomb; Paul J. Isaac, Trustee under the will of Irving H. Isaac; Mary A. Marganos; Bertrand C. Sellier; and Quaker Valley Meats, Inc. Pension Plan UDT 11/1/83, Norman Fleekop, Trustee. Complaint ถ 18(f).
[5] Plaintiff Judith Ludwig also invested in MILP II, but the complaint does not allege the date she purchased her units.
[6] On this date, plaintiffs filed their consolidated class action and derivative complaint.
[7] The court dismisses the claims of the three plaintiffs who allegedly invested in MIF but failed to allege the date they purchased the MIF securities.
[8] Count fourteen's claim for "controlling person" liability under ง 15 of the 1933 Securities Act, 15 U.S.C. ง 77o, is also dismissed, because there can be no controlling person liability under ง 15 without primary liability under ง 11 or 12(2).
[9] Ambrosino involved claims under ง 12(2) of the 1933 Securities Act. Because the statute of limitations set forth in ง 13 of the Securities Act is the same for งง 12(2) and 11, the Ambrosino interpretation of the statute of limitations applies to claims arising under ง 11.
[10] Plaintiffs claim they would be prejudiced because they relied on a rule in which equitable tolling principles allowed them to bring suit more than one year from the date on which they should have discovered the fraud. The new rule, however, does not abolish equitable tolling principles. Rather, it limits the allowable tolling period to no more than two years after the claim should have been discovered. Short, 908 F.2d at 1391.
[11] Plaintiffs do not contest this point, but instead argue that "any clarification that would result [from applying the new rule] could not possibly outweigh the force of the first and third factors." Response at 40, quoting Kayne, 703 F.Supp. at 1344.
[12] Plaintiffs have had ample opportunity to allege purchase dates. Defendants' motion to dismiss clearly points out the absence of purchase dates for many of the investors in the Funds. Plaintiffs made no attempt to address this pleading defect in their response, nor did they move to amend their complaint to allege the missing purchase dates.
[13] The January 11, 1990 class action was the first case filed on behalf of investors in all Funds, naming all the Funds as defendants.
[14] The Land Trust commenced its public offering on September 9, 1986. MILP III's public offering started on December 10, 1986. The public offering for Land Fund II began on August 25, 1987, and MIF began its public offering on March 30, 1988.
[15] Plaintiffs also claim that each Fund issued misleading documents and reports to its shareholders after they purchased securities in the Fund. As the discussion below indicates, these documents may not be considered as part of plaintiffs' securities fraud claim, because plaintiffs have not alleged that anyone purchased securities in a particular Fund in connection with these statements.
[16] Counts one through eight each present allegations concerning a particular Fund. Count nine sues all defendants collectively for securities fraud under the 1934 Securities Exchange Act.
[17] Those plaintiffs are: Jeffrey Alexander; Holly Parmenter; Stewart Eisenberg; Walter D. Ford, Sr.; John Holcomb; Mary Marganos; Quaker Valley Meats, Inc.; Bertrand Sellier; Judith Ludwig; Cook Bros. MPP; Cook Bros. PSR; Edward McDaid; Barbara Tepperman; Lewis D. Rubin; Patrick Reed; and Alan Hess.
[18] Plaintiffs' allegations that the underwriters "participated in preparing materially misleading prospectuses," and that the advisors, appraisers and guarantors "drafted and approved, and/or controlled persons who drafted and approved, the materially misleading communications" are pled on information and belief and are unsupported by allegations of fact. Complaint ถถ 82, 102, 123, 147, 168, 189, 206, 224. Even if these allegations were pled with particularity as required by Rule 9(b), the underwriters, guarantors, appraisers and advisors could only be charged with aiding and abetting liability.
[19] Liability for the defendants alleged to be "controlling persons" of the Funds is addressed later in the discussion.
[20] The court need not address plaintiffs' allegations that the Funds' annual shareholder reports and Forms 10-K and 10-Q failed to reflect adequate loan loss reserves. These allegations refer to documents other than the offering prospectuses, and thus are not relevant to our inquiry under ง 10(b).
[21] The court may properly review the offering prospectuses on this motion to dismiss. On September 19, 1990, this court denied plaintiffs' motion to reconsider its order striking certain exhibits from plaintiffs' response to the motion to dismiss. In so holding, the court stated that it would also disregard any matters raised in defendants' motion to dismiss that go beyond attacking the sufficiency of the allegations contained in the complaint. The prospectuses proffered by defendants do not address matters outside the pleadings. Indeed, plaintiffs concede that they should have attached the prospectuses to their complaint. Response at 7. Thus, the prospectuses may be considered on this motion. See 5 C. Wright & A. Miller, Federal Practice and Procedure, ง 1327 at 762-63 (1969) ("when plaintiff fails to introduce a pertinent document as part of his pleading, defendant may introduce the exhibit as part of his motion attacking the pleading").
[22] Following this standard, the Acme Propane court reversed some of the district court's holdings because the reserve estimate contained several ambiguous statements.
[23] See the prospectuses of: MIF at 15, 25; the Income Trust at 9, 12-15; MILP I at 12-15, 40; MILP II at 12-15, 46; MILP II at 17-20, 60; the Hotel Fund at 13-15; the Land Trust at 13-16; 21; Land Fund II at 15-19; 23.
[24] See the prospectuses of: MIF at 1; MILP I at 1; MILP II at 2; MILP III at 1; the Hotel Fund at 2; the Land Trust at 2; Land Fund II at 2. Also see the Income Trust's prospectus at 27 "[t]he ability of the Trust to attain [its] objectives is subject to circumstances which are beyond the control of the Trust, the Advisor, and their Affiliates ..."
[25] The phrase "Ponzi scheme" finds its origin in a man with a remarkable criminal financial career, Charles Ponzi. See Cunningham v. Brown, 265 U.S. 1, 44 S. Ct. 424, 68 L. Ed. 873 (1924) (Cunningham was Ponzi's trustee in bankruptcy). Since the Brown decision, the term "Ponzi scheme" has been used to describe a fraudulent arrangement that uses later-acquired funds to pay off previous investors. In re Bullion Reserve of North America, 836 F.2d 1214, 1219 n. 8 (9th Cir.), cert. denied, 486 U.S. 1056, 108 S. Ct. 2824, 100 L. Ed. 2d 925 (1988).
[26] The Xerox defendants present an exception to the court's finding of sufficient allegations of scienter. XCC obtained its interest in VMS Realty Partners in February 1987. Prior to this date, XCC, Xerox Corporation, Xerox Credit Corporation, Xerox Financial Services and Melvin Howard remained uninvolved with the Funds and therefore could not have possessed the intent to deceive the Funds' investors.
[27] Plaintiffs claim that Judge Williams' opinion in Edison Credit Union v. Bevill, Bresler & Schulman Inc., No. 79 C 4049 slip op. at 10, 1987 WL 15408, 1987 U.S.Dist. LEXIS 7096 (N.D.Ill. Aug. 3, 1987), embraced the less stringent test for controlling person liability. Response at 32. Contrary to plaintiffs' assertion, the court in Edison held that
[i]t seems consistent with [Congress'] intent to limit liability to "culpable participants" to require the plaintiff to prove facts, beyond mere status, which indicate that the alleged controlling person had the ability and responsibility to control the particular transaction in question.
Id. at 10 (emphasis added).
[28] See, e.g., Beck, 621 F.Supp. at 1564 (Rovner, J.); Kennedy v. Nicastro, 503 F.Supp. at 1121 (Shadur, J.); applying the same standards of controlling person liability for claims under ง 15 of the 1933 Act and ง 20(a) of the 1934 Act.
[29] The relevant portions of the RICO statute, 18 U.S.C. ง 1962 provide:
(a) It shall be unlawful for any person who has received any income derived, directly or indirectly, from a pattern of racketeering activity ... to use or invest, directly or indirectly, any part of such income, or the proceeds of such income, in acquisition of any interest in, or the establishment or operation of, any enterprise which is engaged in ... interstate or foreign commerce.
(b) It shall be unlawful for any person through a pattern of racketeering activity ... to acquire or maintain, directly or indirectly, any interest in or control of any enterprise which is engaged in ... interstate or foreign commerce.
(c) It shall be unlawful for any person employed by or associated with any enterprise engaged in ... interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity....
[30] Under 18 U.S.C. ง 1961(4), an enterprise includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity.
[31] In light of the overwhelming deficiencies in the RICO claims, the court need not address at this time defendants' concerns that the enterprise is not separate from the alleged pattern of racketeering activity. Contrary to defendants' assertions, there is no requirement of a "RICO injury" separate and distinct from the injuries suffered due to the predicate acts of racketeering themselves. Sedima, S.P.R.L. v. Imrex Co., Inc., 473 U.S. 479, 495, 105 S. Ct. 3275, 3284, 87 L. Ed. 2d 346 (1985). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2586298/ | 162 P.3d 1095 (2007)
213 Or. App. 587
STATE
v.
LAWSON.
Court of Appeals of Oregon.
June 20, 2007.
Affirmed without opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588497/ | 944 So. 2d 378 (2006)
PITTMAN
v.
STATE.
No. 5D06-3113.
District Court of Appeal of Florida, Fifth District.
November 28, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645225/ | 994 So.2d 311 (2008)
JONES
v.
STATE.
No. 2D08-939.
District Court of Appeal of Florida, Second District.
October 31, 2008.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2695679/ | [Cite as Cable v. Ohio Dept. of Rehab. & Corr., 2010-Ohio-5823.]
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
WILLIAM CABLE
Plaintiff
v.
OHIO DEPARTMENT OF REHABILITATION AND CORRECTION
Defendant
Case No. 2009-09710-AD
Clerk Miles C. Durfey
MEMORANDUM DECISION
FINDINGS OF FACT
{¶ 1} 1) Plaintiff, William Cable, an inmate incarcerated at defendant’s Allen
Correctional Institution (ACI), filed this action alleging that his television set, keyboard,
CD player, calculator, contact lenses, radio, and photographs were either damaged
beyond repair or stolen as a proximate cause of negligence on the part of ACI staff in
failing to protect the property. Plaintiff related that, “[o]n August 29, 2009 inmate
Charles Williams (#417-628) tossed my K.T.V. television, my Yamaha Keyboard, and
my locker box over the top rail of my housing unit (2B).” Plaintiff asserted that ACI
personnel then failed to secure the area and consequently, property that was stored in
his locker box was stolen by unidentified inmates. Plaintiff claimed that his television
set, keyboard, CD player and calculator were damaged beyond repair as a result of the
act of Inmate Williams. Additionally, plaintiff claimed that his contact lenses, radio, and
“priceless pictures” were stolen. Plaintiff requested additional damages of $1,039.95 for
“emotional stress, depression, mental anguish, priceless pictures, (and copies).” The
$25.00 filing fee was paid and plaintiff requested reimbursement of that cost along with
his damage claim.
{¶ 2} 2) Defendant denied all liability in this matter. Defendant acknowledged
that Inmate Charles Williams did in fact “throw the property complained of off the top
range” of plaintiff’s housing unit. Defendant asserted that plaintiff failed to produce any
evidence to establish that Williams’ intentional act was foreseeable. Defendant
contended that actionable negligence cannot be shown when harm is caused by the
intentional act of a third party that is not foreseeable. Defendant denied that any ACI
personnel failed to protect plaintiff’s property.
CONCLUSIONS OF LAW
{¶ 3} 1) Copying costs are not compensable in a claim of this type. See
Carnail v. Dept. of Rehab. & Corr., Ct. of Cl. No. 2007-06322-AD, 2008-1207; Tyler v.
Ohio Dept. of Rehab. & Corr., Ct. of Cl. No. 2007-07299-AD, 2008-Ohio-3418.
{¶ 4} 2) Also, it should be noted that this court does not recognize any
entitlement to damages for mental distress and extraordinary damages for simple
negligence involving property loss. Galloway v. Department of Rehabilitation and
Correction (1979), 78-0731-AD; Berke v. Ohio Dept. of Pub. Welfare (1976), 52 Ohio
App. 2d 271, 6 O.O. 3d 280, 369 N.E. 2d 1056; Johnson v. Ohio State Penitentiary, Ct.
of Cl. No. 2007-04605-AD, 2008-Ohio-1769; Davis v. Southern Ohio Correctional Inst.,
Ct. of Cl. No. 2009-07296-AD, 2010-Ohio-1953.
{¶ 5} 3) For plaintiff to prevail on a claim of negligence, he must prove, by a
preponderance of the evidence, that defendant owed him a duty, that it breached that
duty, and that the breach proximately caused his injuries. Armstrong v. Best Buy
Company, Inc., 99 Ohio St. 3d 79, 2003-Ohio-2573,¶8 citing Menifee v. Ohio Welding
Products, Inc. (1984), 15 Ohio St. 3d 75, 77, 15 OBR 179, 472 N.E. 2d 707.
{¶ 6} 4) “Whether a duty is breached and whether the breach proximately
caused an injury are normally questions of fact, to be decided . . . by the court . . .”
Pacher v. Invisible Fence of Dayton, 154 Ohio App. 3d 744, 2003-Ohio-5333,¶41;
Mussivand v. David (1989), 45 Ohio St. 3d 314, 318, 544 N.E. 2d 265.
{¶ 7} 5) “If an injury is the natural and probable consequence of a negligent
act and it is such as should have been foreseen in the light of all the attending
circumstances, the injury is then the proximate result of the negligence. It is not
necessary that the defendant should have anticipated the particular injury. It is
sufficient that his act is likely to result in an injury to someone.” Cascone v. Herb Kay
Co. (1983), 6 Ohio St. 3d 155, 160, 6 OBR 209, 451 N.E. 2d 815, quoting Neff Lumber
Co. v. First National Bank of St. Clairsville, Admr. (1930), 122 Ohio St. 302, 309, 171
N.E. 327.
{¶ 8} 6) Although not strictly responsible for a prisoner’s property, defendant
had at least the duty of using the same degree of care as it would use with its own
property. Henderson v. Southern Ohio Correctional Facility (1979), 76-0356-AD.
{¶ 9} 7) Defendant is not responsible for actions of other inmates unless an
agency relationship is shown or it is shown that defendant was negligent. Walker v.
Southern Ohio Correctional Facility (1978), 78-0217-AD; Melson v. Ohio Department of
Rehabilitation and Correction (2003), Ct. of Cl. No. 2003-04236-AD, 2003-Ohio-3615;
Jenkins v. Richland Correctional Inst., Ct. of Cl. No. 2003-01768, 2003-Ohio-4483.
{¶ 10} 8) Ohio law imposes a duty of reasonable care upon the state to provide
for its prisoner’s health, care, and well-being. Clemets v. Heston (1985), 20 Ohio App.
3d 132, 136, 20 OBR 166, 485 N.E. 2d 287. Reasonable or ordinary care is that degree
of caution and foresight which an ordinarily prudent person would employ in similar
circumstances. Smith v. United Properties, Inc. (1965), 2 Ohio St. 2d 310, 31 O.O. 2d
573, 209 N.E. 2d 142.
{¶ 11} 9) Defendant is not liable for the intentional attack on one inmate by
another unless it has adequate notice, either actual or constructive, of an impending
attack. Mitchell v. Dept. of Rehab. & Corr. (1995), 107 Ohio App. 3d 231, 235, 668 N.E.
2d 538.
{¶ 12} 10) Plaintiff has failed to show any causal connection between the
damage to his property items and any breach of a duty owed by defendant in regard to
protecting inmate property. Druckenmiller v. Mansfield Correctional Inst. (1998), 97-
11819-AD; Tomblin v. London Correctional Inst., Ct. of Cl. No. 2005-03431-AD, 2005-
Ohio-4859; Madden v. Lebanon Correctional Inst., Ct. of Cl. No. 2006-06116-AD, jud,
2007-Ohio-1928; Tolbert v. Lebanon Correctional Inst., Ct. of Cl. No. 2007-06942-AD,
2008-Ohio-5152.
{¶ 13} 11) The allegation that a theft may have occurred is insufficient to show
defendant’s negligence. Williams v. Southern Ohio Correctional Facility (1985), 83-
07091-AD; Custom v. Southern Ohio Correctional Facility (1986), 84-02425. Plaintiff
must show defendant breached a duty of ordinary or reasonable care. Williams.
{¶ 14} 12) This court in Mullett v. Department of Correction (1976), 76-0292-AD,
held that defendant does not have the liability of an insurer (i.e., is not liable without
fault) with respect to inmate property, but that it does have the duty to make “reasonable
attempts to protect, or recover” such property.
{¶ 15} 13) Plaintiff must produce evidence which affords a reasonable basis for
the conclusion that defendant’s conduct is more likely than not a substantial factor in
bringing about the harm. Parks v. Department of Rehabilitation and Correction (1985),
85-01546-AD.
{¶ 16} 14) Plaintiff has failed to prove, by a preponderance of the evidence, that
any of his property was lost or stolen as a proximate result of any negligent conduct
attributable to defendant. Fitzgerald v. Department of Rehabilitation and Correction
(1998), 97-10146-AD; Hall v. London Correctional Inst., Ct. of Cl. No. 2008-04803-AD,
2008-Ohio-7088.
Court of Claims of Ohio
The Ohio Judicial Center
65 South Front Street, Third Floor
Columbus, OH 43215
614.387.9800 or 1.800.824.8263
www.cco.state.oh.us
WILLIAM CABLE
Plaintiff
v.
OHIO DEPARTMENT OF REHABILITATION AND CORRECTION
Defendant
Case No. 2009-09710-AD
Clerk Miles C. Durfey
ENTRY OF ADMINISTRATIVE DETERMINATION
Having considered all the evidence in the claim file and, for the reasons set forth
in the memorandum decision filed concurrently herewith, judgment is rendered in favor
of defendant. Court costs are assessed against plaintiff.
________________________________
MILES C. DURFEY
Clerk
Entry cc:
William Cable, #569-457 Gregory C. Trout, Chief Counsel
2338 N. West Street Department of Rehabilitation
Lima, Ohio 45802 and Correction
770 West Broad Street
Columbus, Ohio 43222
RDK/laa
6/23
Filed 8/9/10
Sent to S.C. reporter 11/23/10 | 01-03-2023 | 08-02-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1646364/ | 9 So.3d 626 (2009)
REVELL
v.
DEPARTMENT OF AGRICULTURE.
No. 2D08-3759.
District Court of Appeal of Florida, Second District.
May 22, 2009.
Decision without published opinion. Appeal dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3032090/ | NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS FILED
FOR THE NINTH CIRCUIT JAN 19 2010
MOLLY C. DWYER, CLERK
U .S. C O U R T OF APPE ALS
JUANA INES SALAZAR-ARMENTA, No. 06-70748
Petitioner, Agency No. A074-820-499
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.
Juana Ines Salazar-Armenta, a native and citizen of Mexico, petitions for
review of the Board of Immigration Appeals’ order dismissing her appeal from an
immigration judge’s (“IJ”) decision finding her removable for having participated
*
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 alien smuggling. Our jurisdiction is governed by 8 U.S.C. § 1252. We review
de novo questions of law. Altamirano v. Gonzales, 427 F.3d 586, 591 (9th Cir.
2005). We deny in part and dismiss in part the petition for review.
The IJ correctly determined that Salazar-Armenta is inadmissible due to her
participation in alien smuggling. See 8 U.S.C. § 1182(a)(6)(E)(i); see also
Altamirano, 427 F.3d at 592.
We lack jurisdiction to consider Salazar-Armenta’s contention that the I-213
form did not demonstrate whether a government agent had informed her of her
rights because she did not raise that issue before the BIA. See Barron v. Ashcroft,
358 F.3d 674, 678 (9th Cir. 2004).
PETITION FOR REVIEW DENIED in part; DISMISSED in part.
LA/Research 2 06-70748 | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/32108/ | United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS July 29, 2003
FOR THE FIFTH CIRCUIT Charles R. Fulbruge III
Clerk
____________________
No. 03-40066
Summary Calendar
____________________
RONNIE MEISSNER
Plaintiff - Appellee
v.
FROG LEAP, Etc; ET AL
Defendants
RICHARD S KARAM
Defendant - Appellant
_________________________________________________________________
Appeal from the United States District Court
for the Eastern District of Texas
No. 2:02-CV-262
_________________________________________________________________
Before KING, Chief Judge, and WIENER and CLEMENT, Circuit Judges.
PER CURIAM:*
Defendant-Appellant Richard S. Karam appeals the district
court’s remand of this case to state court. Because we conclude
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR. R.
47.5.4.
that this court is statutorily precluded from reviewing the
remand order, we dismiss Karam’s appeal for lack of jurisdiction.
Plaintiff-Appellee Ronnie Meissner originally filed this
civil action in Texas state district court, seeking an order
requiring Karam to account and divide the assets and profits of
their general partnership, Defendant Frog Leap. Karam removed
the case to federal district court based solely on the existence
of diversity of citizenship. Meissner then filed a motion to
remand.
The federal district court determined that the Frog Leap
partnership consisted of two partners, one of whom (Meissner) was
a citizen of Texas, and the other (Karam) was a citizen of
Oklahoma. Consequently, the court found that Frog Leap should be
considered a citizen of both Texas and Oklahoma. Because both
Frog Leap and Meissner had Texas citizenship, the court concluded
that diversity jurisdiction did not exist. Given that diversity
jurisdiction was Karam’s only asserted basis for subject matter
jurisdiction, the court granted Meissner’s motion and remanded
the case to state court.
The threshold question in this case is whether we have
appellate jurisdiction to review the district court’s remand.
Section 1447(c) of Title 28 of the United States Code authorizes
remand for lack of subject matter jurisdiction, while § 1447(d)
provides that “an order remanding a case to the State court from
which it was removed is not reviewable on appeal or otherwise.”
2
Save for a few exceptions, “a remand to state court for lack of
subject matter jurisdiction under § 1447(c) is ordinarily barred
from appellate review by § 1447(d).” Arnold v. Garlock, 278 F.3d
426, 437 (5th Cir. 2001). This rule applies even if the district
court’s determinations regarding subject matter jurisdiction are
erroneous. Heaton v. Monogram Credit Card Bank of Ga., 231 F.3d
994, 997 (5th Cir. 2000).
One exception to this rule is derived from the Supreme
Court’s decision in Thermtron Products, Inc. v. Hermandorfer, 423
U.S. 336 (1976). The Thermtron Court carved out a “narrow
exception to the strict bar to appellate review of remand orders.
[The Thermtron exception provides that] a remand order may be
reviewed where the district court has ‘remanded [a case] on
grounds not authorized by the removal statutes.’” Angelides v.
Baylor Coll. of Med., 117 F.3d 833, 836 (5th Cir. 1997) (quoting
Thermtron, 423 U.S. at 353).
On appeal, Karam contends that the Thermtron exception
applies because the district court ruled on an issue not
specifically stated in the motion to remand when it determined
that Frog Leap was a necessary party to the litigation. In so
doing, he continues, the court exceeded its statutorily-defined
powers under § 1447(c). As a result, Karam concludes, appellate
jurisdiction is proper.
3
We agree with Meissner’s contention that Thermtron is
plainly distinguishable from this case. In Thermtron, the Court
held that a district court exceeded its removal powers under
§ 1447(c) when “neither the propriety of the removal nor the
jurisdiction of the court was questioned,” and the district
court’s determining factor for remand was its heavy docket. 423
U.S. at 343-44. These unique considerations are not present in
this case. In his motion to remand, Meissner argued that the
basis for remand was the absence of diversity between the named
parties. The remand order, incorporating Meissner’s argument,
expressly concluded that diversity jurisdiction was lacking. In
so doing, the district court directly implicated subject matter
jurisdiction, which plainly indicates that the court remanded the
case on grounds that are authorized by § 1447(c). Thus,
regardless of the court’s determination that Frog Leap was a
necessary party to the litigation, the narrow Thermtron exception
is not applicable.
Because Karam fails to demonstrate that any of the available
exceptions to § 1447(c) apply, we are required under § 1447(d) to
DISMISS this appeal for lack of jurisdiction.
4 | 01-03-2023 | 04-25-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1547952/ | 156 F.2d 122 (1946)
COMMISSIONER OF INTERNAL REVENUE
v.
MOTOR MART TRUST.
No. 4124.
Circuit Court of Appeals, First Circuit.
June 20, 1946.
Muriel S. Paul, Sp. Asst. to Atty. Gen. (Sewall Key, Acting Asst. Atty. Gen., and J. Louis Monarch, Sp. Asst. to Atty. Gen., of counsel), for the Commissioner.
Stanley R. Miller, of Boston, Mass., for taxpayer.
Before MAGRUDER, MAHONEY, and WOODBURY, Circuit Judges.
MAGRUDER, Circuit Judge.
Respondent, Motor Mart Trust (hereinafter referred to as the taxpayer), is a Massachusetts trust taxable as a corporation under the provisions of the Internal Revenue Code. The Commissioner determined deficiencies in its income and excess profits taxes for the years 1939 and 1940. Such deficiencies resulted from the Commissioner's reduction of the taxpayer's claimed basis for depreciation on a certain building. Whether the Commissioner's ruling was correct depends upon the effect of §§ 268 and 270 of the Bankruptcy Act, as amended by the Chandler Act, 52 Stat. 904, 11 U.S.C.A. §§ 668, 670, in their application *123 to a reorganization of the taxpayer in a proceeding initiated under § 77B, 11 U.S.C. A. § 207.
Upon its organization in 1926, the taxpayer acquired a leasehold interest in land in Park Square, Boston. It issued 5000 Class B common shares for the leasehold interest, which it set up on its balance sheet at $500,000. A building was erected on the land at a cost of $2,046,469.35, financed by the sale of first mortgage bonds, second mortgage bonds, and preferred shares.
At the date of its completion, January 1, 1927, the building had an estimated life of 42.95 years. The taxpayer has from the outset made an amortization charge of $47,649.97, which was sufficient to reduce the cost basis to zero at the expiration of 42.95 years from January 1, 1927. In each year, including 1939 and 1940 (the tax years now in question), the taxpayer deducted from gross income as reported on its income tax returns the aforesaid charge of $47,649.97.
Early in 1937, the taxpayer was insolvent and interest payments on the mortgage bonds were in default. On April 1, 1937, the trustee under the indenture securing the first mortgage bonds served notice of an intention to foreclose.
On April 30, 1937, the taxpayer filed a petition for reorganization under § 77B in the District Court of the United States for the District of Massachusetts. At that time its outstanding liabilities were:
First Mortgage Bonds $1,193,500.00
Interest on First Mortgage
Bonds 298,375.00
Second Mortgage Bonds 282,000.00
Interest on Second Mortgage
Bonds 101,900.00
Trustees' Compensation. Unpaid 68,651.77
Scrip Certificates (Int. on
First Mtg. Bonds) 60,750.00
8% Preferred Shares (Par
Value $100). 1,250 shares
Class B Common, no par
value 5,000 shares
A substitute plan of reorganization was proposed by the debtor and presented to the court on September 30, 1937. The plan was confirmed by the court by order entered June 21, 1938, but the final decree in the reorganization proceeding was not entered until January 16, 1939.
The plan called for the retirement of all existing securities. The interest of the old shareholders was completely extinguished. New issues of 9,548 convertible preferred shares at a par value of $50 per share, and 6,437 common shares at a par value of $5 per share were provided for, to be distributed as follows:
To Holders of First
Mtg. Bonds
9,548 Shares Preferred
at $50 $477,400
4,774 Shares Common
at $5 23,870
________
$501,270
To Holders of 2nd Mtg. Bonds
1,410 Shares Common at $5 7,050
To Trustees under the bonds in
satisfaction of their claims
for compensation
253 Shares Common at $5 1,265[1]
Before the plan of reorganization was confirmed, the question naturally arose whether its consummation would result in the realization of taxable income to the debtor in reorganization under the principle of United States v. Kirby Lumber Co., 1931, 284 U.S. 1, 52 S.Ct. 4, 76 L.Ed. 131. In this connection Article 22(a)-14 of Treasury Regulations 94 then in force read as follows:
Cancellation of indebtedness. The cancellation of indebtedness, in whole or in part, may result in the realization of income. If, for example, an individual performs services for a creditor, who in consideration thereof cancels the debt, income in the amount of the debt is realized by the debtor as compensation for his services. A taxpayer realizes income by the payment or purchase of his obligations at less than their face value. (See article 22(a)-18.) If a shareholder in a corporation which is indebted to him gratuitously forgives the debt, the transaction amounts to a contribution *124 to the capital of the corporation. Income is not realized by a taxpayer by virtue of the discharge of his indebtedness as the result of an adjudication in bankruptcy, or by virtue of a composition agreement among his creditors, if immediately thereafter the taxpayer's liabilities exceed the value of his assets.
On March 2, 1938, counsel for the trustees in reorganization forwarded to the Commissioner a copy of the pending plan and requested an opinion as to whether, upon its consummation, "any taxable gain or income will result to the debtor." By letter dated May 13, 1938, the Commissioner replied in part as follows:
"Under the facts presented, and as above outlined, it does not appear that there is involved in the plan any question of the cancellation of indebtedness. In each instance with the exception hereinafter noted[2] where an indebtedness of the corporation is involved and is being extinguished it is to be effected through an exchange and a payment of the indebtedness rather than through cancellation of the indebtedness, the consideration being the exchange of its new convertible preferred shares and common shares for its first and second mortgage bonds, and the accrued interest thereon. The same situation exists with respect to the satisfaction of the unpaid compensation due trustees which had accrued prior to January 1, 1933. The trustees accept the common stock in payment and discharge of their claim. It is, therefore, the opinion of this office that no taxable income will be realized by the taxpayer by reason of these transactions."
If we understand correctly the Commissioner's present position, he does not undertake to disavow this ruling made by his predecessor in 1938. In any event, the ruling was clearly correct. See Commissioner v. Capento Securities Corporation, 1 Cir., 1944, 140 F.2d 382. At the date of the reorganization the equity of the old shareholders had vanished, and in substance the bondholders were the owners of the company. This situation was merely given formal recognition under the plan of reorganization whereby the interests of the old shareholders were extinguished and the bondholders changed their status to that of shareholders in the reorganized company. It would be economic nonsense to say that the taxpayer thereby made a present realization of taxable gain when the bonds were retired in the manner stated.[3]
After the date of the court order confirming the plan of reorganization, but before the date of the final order in the reorganization proceeding, the Chandler Act became effective. The text of §§ 268 and 270 of the Bankruptcy Act as thus amended is as follows:
"Sec. 268. Except as provided in section 270 of this Act, no income or profit, taxable under any law of the United States or of any State now in force or which may hereafter be enacted, shall, in respect to the adjustment of the indebtedness of a debtor in a proceeding under this chapter, be deemed to have accrued to or to have been realized by a debtor, by a trustee provided for in a plan under this chapter, or by a corporation organized or made use of for effectuating a plan under this chapter by reason of a modification in or cancellation in whole or in part of any of the indebtedness of the debtor in a proceeding under this chapter."
"Sec. 270. In determining the basis of property for any purposes of any law of the United States or of a State imposing a tax upon income, the basis of the debtor's property (other than money) or of such property (other than money) as is transferred to any person required to use the debtor's basis in whole or in part shall be decreased by an amount equal to the *125 amount by which the indebtedness of the debtor, not including accrued interest, unpaid and not resulting in a tax benefit on any income tax return, has been canceled or reduced in a proceeding under this chapter, but the basis of any particular property shall not be decreased to an amount less than the fair market value of such property as of the date of entry of the order confirming the plan. Any determination of value in a proceeding under this chapter shall not be deemed a determination of fair market value for the purposes of this section. The Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, shall prescribe such regulations as he may deem necessary in order to reflect such decrease in basis for Federal income-tax purposes and otherwise carry into effect the purposes of this section."[4]
The Commissioner ruled that by virtue of § 270 the taxpayer was no longer entitled to use its original basis in computing the deductions for depreciation for each of the taxable years 1939 and 1940. Finding that the fair market value of the building on the date of reorganization was $404,719.54 and that its unexpired life as of that date was 30½ years, the Commissioner disallowed in part the claimed deduction for depreciation of $47,649.97 and allowed the same only in the reduced amount of $13,269.49 ($404,719.54 ÷ 30.5), saying:
"The reorganization under Section 77B of the Bankruptcy Act on June 21, 1938, is not deemed to have resulted in the creation of a new trust on that date. However, under the provisions of Section 270 of the Bankruptcy Act of 1938, as amended by the Act of June 22, 1938 (Public No. 696, 75th Congress) and the Act of July 1, 1940 (Public No. 699, 76th Congress, Third Session) the basis for the allowance of depreciation or amortization in connection with the building erected in 1926 on land leased by the trust is the fair market value of the building on June 21, 1938, the date of reorganization. * * *"
Upon petition for redetermination of the deficiencies found by the Commissioner, the Tax Court reversed the Commissioner and entered its decision that there were no deficiencies in the taxpayer's income and excess profits taxes for the years 1939 and 1940.
It seems to be the clear implication of Claridge Apartments Co. v. Commissioner, 1944, 323 U.S. 141, 65 S.Ct. 172, 89 L.Ed. 139, that by virtue of § 276, sub. c of the Bankruptcy Act, as amended, 52 Stat. 905, 11 U.S.C.A. § 676, sub. c, § 270 applies to a reorganization proceeding commenced under § 77B if such proceeding was still pending on the effective date of the Chandler Act; that is, if the final decree in the reorganization proceeding was not entered until after the effective date of the Chandler Act, even though the plan of reorganization may have been confirmed by court order entered prior to such date. For present purposes we shall so assume, though the precise point was not presented for decision in that case.
We refer to the Claridge case, supra, for an extensive review of the legislative history and purpose of §§ 268 and 270 of the Bankruptcy Act. Section 268 had no other object "than to free Chapter X reorganizations from the tax deterrents, including tax uncertainties, imposed by the existing revenue act provisions", thereby encouraging "the freer use of bankruptcy reorganization in order to avoid unnecessary or premature liquidations". 323 U.S. at page 149, 65 S.Ct. at page 178, 89 L.Ed. 139.
In its original form as considered by the House committee, the Chandler Act contained no counterpart of the present § 270. The text of § 270 was prepared and offered by the Treasury Department as an appropriate provision complementary to the tax boon afforded by § 268. The Assistant General Counsel of the Treasury explained to the House committee: "Moreover, we feel that if this remedial provision [§ 268] is written into the law, it should be connected up with a provision for the reduction of the basis of the assets of the debtor to the extent that Congress refrain[s] from taxing income which it would be entitled, *126 under the law, to tax."[5] Otherwise, there would in effect result a "double deduction" unfair to the revenue. The report of the Senate committee thus explained the purpose of § 270: "This provision is intended to avoid a double deduction. When debt forgiveness, resulting from a debt readjustment, is exempt from the tax upon income or profit, the cost of the property dealt with by the settlement is to be decreased, for future tax-valuation purposes, by an amount equal to the amount of the indebtedness canceled or reduced in the proceeding."[6]
As previously stated, the taxpayer here obtained no tax advantage from § 268, for upon consummation of the plan of reorganization the taxpayer realized no gain which would otherwise have been taxable under the provisions of the revenue acts. Hence, if § 270 is to be construed, as the Commissioner maintains, to require the taxpayer to take a reduced basis for the building, with consequent increase of its future tax liabilities, the result would be to create a new, substantial tax deterrent to bankruptcy reorganization which is just the opposite of what Congress thought it was accomplishing in enacting §§ 268 and 270. Such tax disadvantage from basis reduction would not have resulted to the taxpayer by a conversion of debt into stock in a capital transaction outside the bankruptcy court. As the Supreme Court pointed out in the Claridge case, supra (323 U.S. at page 151, 65 S.Ct. at page 179, 89 L.Ed. 139): "And in cases where no benefit could be derived from Section 268, the effect of applying Section 270 was, if not to impose a capital levy, then to deny the new owners equal treatment, not only with other transferees under the code provisions, but with all other taxpayers." Further, the court commented: "Congress, in view of its original object in adopting Section 268, could not possibly have intended such consequences for Section 270." And it must be borne in mind that §§ 268 and 270 were not in their origin and purpose tax provisions for raising increased revenue, but were "essentially tax relief provisions", having the primary object "to provide tax relief for parties undertaking reorganization and to prevent the clogging effects of the existing tax laws upon the operation of the Chandler Act." (323 U.S. at page 163, n. 35, 65 S.Ct. at page 184, 89 L.Ed. 139.)
It may be that § 270 is not aptly phrased so as to dovetail completely with § 268; in other words, it is possible that the reduction in basis required by § 270 is not entirely limited to cases where discharges of debt would have given rise to taxable gain but for the saving provision of § 268. As stated in the Claridge case (323 U.S. at page 151, 65 S.Ct. at page 179, 89 L.Ed. 139): "The legislative history gives the clear impression that adoption of the original Section 270 was a plain blunder, the consequences of which were not foreseen, understood or intended by those who finally gave it the form of law." But at least § 270, so far as the wording will permit, should be given an interpretation consistent with the "primary object" of Congress in enacting these related provisions of the Chandler Act.
Section 270 provides that "the basis of the debtor's property * * * shall be decreased by an amount equal to the amount by which the indebtedness of the debtor * * * has been canceled or reduced in a proceeding under this chapter." Literally, payment of a debt effects a reduction of indebtedness, but the Commissioner does not suggest that § 270 would require a corresponding reduction in basis in such a case. "Canceled or reduced" is apparently equivalent to "canceled in whole or in part", so the key word to be construed is "canceled." Was the taxpayer's bond indebtedness "canceled" within the meaning of § 270?
In May, 1938, the Commissioner ruled that the consummation of the plan of reorganization did not involve a "cancellation of indebtedness" within the meaning of Article 22(a)-14 of Treasury Regulations 94. It is true, the Commissioner was not then construing § 270 of the Bankruptcy *127 Act, which had not yet been enacted. But we think that by a parity of reasoning, the taxpayer's bond indebtedness may be deemed not to have been "canceled" within the meaning of § 270 by the conversion of bonds into stock. The offer of stock, with its accompanying equity rights in the company, was good consideration for the surrender of the bonds; and this is so whether the par value of the stock or its then market value was greater or less than the face value of the bonds. The transaction may be considered a form of payment for the bonds, not cancellation.
The decision of the Tax Court is affirmed.
NOTES
[1] $4,050 in cash was paid to the holders of the scrip certificates.
[2] The exception to which the Commissioner referred related to the cash payment to the holders of the scrip certificates. The case at bar is not concerned with the tax consequences of this small detail of the reorganization plan.
[3] Cf. Helvering v. American Dental Co., 1943, 318 U.S. 322, 327, 63 S.Ct. 577, 580, 87 L.Ed. 785: "Possibly because it seems beyond the legislative purpose to exact income taxes for savings on debts, the courts have been astute to avoid taxing every balance sheet improvement brought about through a debt reduction."
[4] We have put in italics the portion of § 270 added by further amendment in 1940. 54 Stat. 709.
[5] Hearings before House Committee on the Judiciary on H.R. 8046, 75th Cong., 1st Sess., 1937, p. 353.
[6] Sen. Rep. No. 1916, 75th Cong., 3d Sess., 1938, p. 7. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919215/ | 75 Md. App. 364 (1988)
541 A.2d 648
IRENE EVANS
v.
ROBERT J. EVANS.
No. 88, September Term, 1988.
Court of Special Appeals of Maryland.
June 3, 1988.
Thomas F. Ellis, III, Annapolis, for appellant.
Margaret L. Demedis, Dunkirk, for appellee.
Argued before MOYLAN, WILNER and ALPERT, JJ.
ALPERT, Judge.
In this expedited appeal, we revisit the nagging problem of defining subject matter jurisdiction. On March 29, 1985, Judge Perry G. Bowen, Jr. of the Circuit Court for Calvert County signed an order for absolute divorce dissolving the marriage of Irene Evans (appellant) and Robert J. Evans (appellee). One provision of the order was "that Robert Evans is to forward to Irene Evans, the sum of $200.17 per month representing a one-half interest in a vested Air Force retirement plan."[1] No appeal was taken from this order.
In March of 1986, Irene Evans filed a petition to cite Robert Evans for contempt of court. Robert responded to the petition with the following answer on April 1, 1986:
By Order dated March 29, 1985, this Court ordered division of Air Force Disability payments. The amount ordered to Mrs. Evans was $200.17. The parties have subsequently learned that because this is an Air Force disability payment it is not divisible and not within the subject matter jurisdiction of this Court.
.....
Because the Court lacks subject matter jurisdiction to award these funds, the prior Order is null and void.
A hearing was held on April 18, 1987 during which the disability pension and several other issues were discussed. Insofar as the disability pension was concerned, the judge noted:
My recollection is that [$200.17] was part of an entire scheme of dividing their property. And so it may well be that if it cannot be done or ought not to be done, then we might have to go back and restudy the whole arrangement that we made, because that was a part of it.
But in any event, the order is going to have to be obeyed until it is changed.
On August 11, 1987, Irene again filed a petition to cite Robert for contempt for his failure to remit to her the $200.17 a month from his military disability retirement pay. Robert responded on August 31, 1987 with an answer and a motion to amend or revise judgment which again raised the argument that the court lacked subject matter jurisdiction over the military disability pension.
A second hearing was held in September of 1987. In an oral opinion, the judge noted that under 10 U.S.C. § 1408(c)(1), military disability retirement pay is not marital property. He then held he had no jurisdiction to divide the military disability pension as marital property. He further ruled that a jurisdictional matter "can be dealt with at any time" and "that at any point when it is enforced, you can object to it." The judge subsequently signed an order granting the motion to amend or revise judgment, and deleted the provision of the previous order that Robert was to pay Irene $200.17 per month from his Air Force retirement plan.
Irene then noted this appeal, raising the following issue: did the trial judge have authority to revise the order sub judice? We hold that he did not.
Under the rules, a judgment may be revised "[o]n motion of any party filed 30 days after entry of judgment...." Md.Rule 2-535(a). After expiration of that 30 day period, a judgment becomes enrolled and the court may exercise revisory power and control over the judgment only in case of fraud, mistake or irregularity. Md. Rule 2-535(b); see also Office of People's Counsel v. Advance Mobilehome Corp., 75 Md. App. 39, 540 A.2d 151 (1988).
This court has explained that "mistake" as it is used in Rule 2-535(b) is limited to a jurisdictional mistake. Bernstein v. Kapneck, 46 Md. App. 231, 239, 417 A.2d 456 (1980); Hamilos v. Hamilos, 52 Md. App. 488, 497, 450 A.2d 1316 (1982), aff'd, 297 Md. 99, 465 A.2d 445 (1983), aff'd sub nom, Johnston v. Johnston, 297 Md. 48, 465 A.2d 436 (1983). Thus, the parties concede the trial judge could revise the judgment only if the erroneous categorization of a military disability pension as marital property was a jurisdictional mistake. We hold that the mistake was not jurisdictional.
Appellee, relying on the Supreme Court case of McCarty v. McCarty, 453 U.S. 210, 101 S.Ct. 2728, 69 L.Ed.2d 589 (1981), contends that the award of the military disability pension was a jurisdictional error that rendered that portion of the divorce decree null and void. Appellant asserts, however, that the error was simply a legal mistake that could not be elevated to a jurisdictional question.
In order to explain clearly our decision, we must examine McCarty, its background, its past and its present. In 1981, the Supreme Court of the United States held that military retirement pay could not be considered community property upon the dissolution of a marriage. See McCarty v. McCarty, 453 U.S. 210, 101 S.Ct. 2728.[2] The Court reasoned that "it is manifest that the application of community property principles to military retired pay threatens grave harm to `clear and substantial' federal interests." Id. at 232, 101 S.Ct. at 2741 (citing United States v. Yazell, 382 U.S. 341, 352, 86 S.Ct. 500, 507 (1966)). The Court explained that the application of community property laws to military pensions would "diminish that portion of the benefit Congress has said should go to the retired [service member] alone." Id. 453 U.S. at 233, 101 S.Ct. at 2741. The Court also feared that enforcement of the community property law would create "[t]he potential for disruption of military personnel management" because it would decrease the attractiveness of the military retirement system which "is designed to serve as an inducement for enlistment and re-enlistment, to create an orderly career path and to ensure `youthful and vigorous' military forces." Id. at 234, 101 S.Ct. at 2742. While the Court recognized the plight of an ex-spouse of a retired service member, the Court held that the protection of those former spouses should be left to Congress. Id. at 235-36, 101 S.Ct. at 2742-43. Federal law as it existed at that time, the Court held, did not permit a state to classify a military pension as community property.
In response to McCarty, Congress enacted in September of 1982 the "Uniform Services Former Spouses' Protection Act." Pub.L. No. 97-252, § 1001-1002, codified at 10 U.S.C. § 1408 (September 8, 1982).[3] Senator Jeremiah Denton explained the need for the USFSPA this way:
Those wives who have loved and served as wives and mothers for many years deserve more than mere recognition. They are entitled to a degree of security.
S.Rep. No. 97-502 on Title X of Pub.L. 97-252, 97th Cong., 2d Sess. 43, reprinted in 1982 U.S.Code Cong. & Ad.News 1626. The statute permitted a court, under certain circumstances, to treat "disposable retired or retainer pay" either as "property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction of such court." 10 U.S.C. § 1408(c)(1). The statute, however, specifically excepted from the term "disposable retired or retainer pay" money paid as disability retirement pay under Chapter 61 of Title 10. See 10 U.S.C. § 1408(a)(4) (1982).
The exemption of military disability pensions from the states' marital and community property laws was limited somewhat in 1986.[4] On November 14, 1986, Congress amended 10 U.S.C. § 1408 to provide:
(4) "Disposable retired or retainer pay" means the total monthly retired or retainer pay to which a member is entitled less amounts which
* * * * * *
(E) in the case of a member entitled to retired pay under chapter 61 of this title [disability retirement pay], are equal to the amount of retired pay of the member under that chapter computed using the percentage of the member's disability on the date when the member was retired (or the date on which the member's name was placed on the temporary disability retired list)[.]
10 U.S.C. § 1408(a)(4)(E). This amendment limits the exemption of military disability retirement pay from marital property laws in an amount related to the retired person's percentage of disability on the date of retirement.
It is clear under 10 U.S.C. § 1408 that classification of a military disability pension as marital property is in error.[5] The question that we must decide is whether the alleged error was one of subject matter jurisdiction, in which case the subject order could be void, or if the error was one of law, in which case the order would merely be voidable. As explained in Freeman on Judgments:
The legitimate province of collateral impeachment is void judgments. There and there alone can it meet with any measure of success. Decision after decision bears this import: In every case the field of collateral inquiry is narrowed down to the single issue concerning the void character of the judgment and the assailant is called upon to satisfy the court that such is the fact. To compass his purpose of overthrowing the judgment, it is not enough that he show a mistaken or erroneous decision or a record disclosing nonjurisdictional irregularities in the proceedings leading up to the judgment. He must go beyond this and show to the court, generally from the face of the record itself, that the judgment complained of is utterly void. If he can do that his attack will succeed for the cases leave no doubt respecting the right of a litigant to collaterally impeach a judgment that he can prove to be void.
A.C. Freeman, 1 Freeman on Judgments, § 322 at 642 (5th ed. 1925) (footnotes omitted). As Freeman explains, collateral attack cannot successfully affect an enrolled judgment that is merely voidable rather than void. The rationale for this rule was explained:
The law provides adequate remedies for obtaining direct relief from erroneous or irregular decisions. It is not the policy of the law to permit a party to such judgments to stand idly by without availing himself of the opportunity given him to repair the mistakes and missteps of a court acting within its jurisdiction although in an erroneous manner and to reserve his objections for litigation in a collateral proceeding.
1 Freeman on Judgments, § 322 at 645.
The Restatement of the Law of Judgments explains how to reconcile the court's traditional interest in finality and collateral attacks for lack of subject matter jurisdiction:
§ 12. Contesting Subject Matter Jurisdiction
When a court has rendered a judgment in a contested action, the judgment precludes the parties from litigating the question of the court's subject matter jurisdiction in subsequent litigation except if:
(1) The subject matter of the action was so plainly beyond the court's jurisdiction that its entertaining the action was a manifest abuse of authority; or
(2) Allowing the judgment to stand would substantially infringe the authority of another tribunal or agency of government; or
(3) The judgment was rendered by a court lacking capability to make an adequately informed determination of a question concerning its own jurisdiction and as a matter of procedural fairness the party seeking to avoid the judgment should have opportunity belatedly to attack the court's subject matter jurisdiction.
Restatement (Second) of Judgments, § 12 (1982).
Recently, in Karabetis v. City of Baltimore, 72 Md. App. 407, 530 A.2d 293 (1987), we summarized Maryland law on the subject: "Only when a court lacks the `fundamental jurisdiction to render the judgment' is there an absence of authority so as to render the judgment a nullity." Id. at 419, 530 A.2d 293 (citing Stewart v. State, 287 Md. 524, 526, 413 A.2d 1337 (1980)). Drawing the line between one kind of mistake and the other often is not an easy task. As the Court of Appeals noted: "[w]hat is meant by the lack of jurisdiction in its fundamental sense such as to make an otherwise valid decree void is often misunderstood." First Federated Commodity Trust Corp. v. Commissioner, 272 Md. 329, 334, 322 A.2d 539 (1974). The First Federated court cited an earlier Court of Appeals case to explain:
"Juridically, jurisdiction refers to two quite distinct concepts: (i) the power of a court to render a valid decree, and (ii) the propriety of granting the relief sought. 1 Pomeroy, Equity Jurisprudence (5th ed. 1941), Secs. 129-31."
First Federated at 334, 322 A.2d 539 (citing Moore v. McAllister, 216 Md. 497, 507, 141 A.2d 176 (1958)) (emphasis in original).
To ascertain whether a court has power, it is necessary to consult the Constitution of the State and the applicable statutes. These usually concern two aspects: (a) jurisdiction over the person obtained by proper service of process and (b) jurisdiction over the subject matter the cause of action and the relief sought.
Moore, 216 Md. at 507, 141 A.2d 176. A challenge for lack of subject matter jurisdiction may be raised at any time. Karabetis, 72 Md. App. at 418, 530 A.2d 293. Conversely, "[t]he propriety of granting the relief sought, as opposed to fundamental jurisdiction, merges into the final judgment and cannot be attacked once enrolled." Id. at 419, 530 A.2d 293.
The judge's error, if any, in awarding Irene a one-half interest in Robert's military disability pension was an error of law and not of jurisdiction. The judge had the power to make the award of marital property; it is the propriety of a portion of his award that Robert seeks to challenge by collateral attack. We agree with the following explanation of the law by the Supreme Court of Missouri:
[W]here the Constitution or a statute authorizes a court to do a particular thing, and the power of the court to act is subject to certain limitations named, then a judgment of the court rendered contrary to the limitations named is not void for want of jurisdiction nor subject to collateral attack, but is voidable only.
Sullinger v. West, 211 S.W. 65, 67 (1919).
This result is supported by cases in federal district and circuit courts that refused to apply McCarty retroactively to invalidate existing marital awards of military pensions. See, e.g., In re Chandler, 805 F.2d 555 (5th Cir.1986), cert. denied, ___ U.S. ___, 107 S.Ct. 2180, 95 L.Ed.2d 837 (1987); Armstrong v. Armstrong, 696 F.2d 1237 (9th Cir.1983), cert. denied, 464 U.S. 933, 104 S.Ct. 337, 78 L.Ed.2d 306 (1983); Brown v. Robertson, 606 F. Supp. 494 (W.D.Tex. 1985); Allcock v. Allcock, 107 Ill. App.3d 150, 62 Ill.Dec. 865, 437 N.E.2d 392 (1982). Those courts uniformly rejected claims by the retired service members that under McCarty courts that had awarded military pensions as marital property had exceeded their authority. Thus, those courts refused to find the awards were void ab initio, and they held the service members could not collaterally attack the judgments. In Erspan v. Badgett, 659 F.2d 26, the Fifth Circuit explained:
Unlike both McCarty and Hisquierdo [v. Hisquierdo, 439 U.S. 572, 99 S.Ct. 802, 59 L.Ed.2d 1 (1979)], however, which were direct appeals from state court divorce decrees, the case sub judice is not: there is no divorce decree before this Court. Moreover, notwithstanding defendant's invitation for this Court to `reverse' the February 21, 1963 judgment of the 65th Judicial District Court of El Paso County, Texas, we have no such jurisdiction. Defendant advances no reason why that judgment should be denied its usual res judicata effect, and none is readily apparent; as a final judgment, it settles not only the issues actually litigated, but also any issues that could have been litigated in that proceeding. Federated Department Stores, Inc. v. Moitie, [452] U.S. [394], 101 S.Ct. 2424, 2427, 69 L.Ed.2d 103 (1981). Furthermore, as the Supreme Court noted in Federated Department Stores, `the res judicata consequences of a final, unappealed judgment on the merits [are not] altered by the fact that the judgment may have been wrong or rested on a legal principle subsequently overruled in another case.' [452 U.S. at 398], 101 S.Ct. 2427 (citations omitted). Nothing in McCarty suggests that the Supreme Court therein intended to invalidate, or otherwise render unenforceable, prior valid and subsisting state court judgments. Absent some indication of such an intent, we decline to do so.
Erspan v. Badgett, 659 F.2d 26, 28 (5th Cir.1981) (footnotes omitted), cert. denied, 455 U.S. 945, 102 S.Ct. 1443, 71 L.Ed.2d 658 (1982). Similarly, in In Re Marriage of Smith, the United States Court for the Western District of Texas refused to apply McCarty retroactively, and held:
The Smith divorce decree is a final, unappealed judgment on the merits. This Court has no power to alter the terms of the divorce decree even if, as Mr. Smith asserts, the divorce decree's division of his military disability retirement pay was wrong or overruled by subsequent law.
549 F. Supp. 761, 767 (W.D.Tex. 1982).
The Supreme Court itself effectively ruled that state court judgments already existing when McCarty was issued were not void for lack of subject matter jurisdiction. In the California case In re Marriage of Sheldon, 124 Cal. App.3d 371, 177 Cal. Rptr. 380 (1981), the California Court of Appeals held that McCarty did not apply retroactively to cases not final on appeal if the parties had not raised the federal preemption issue. The aggrieved exservice member then filed an appeal to the Supreme Court of the United States raising, inter alia, the following issue:
Does federal preemption of state community property laws regarding division of military retirement pay render state judgments void for lack of subject matter jurisdiction where such judgments were entered after Congress had preempted area of law?
50 U.S.L.W. 3869. The Supreme Court dismissed the appeal in Sheldon v. Sheldon, 456 U.S. 941, 102 S.Ct. 2002, 72 L.Ed.2d 462 (1982) "for want of substantial federal question." As explained by the Ninth Circuit, "[a] summary dismissal by the Supreme Court of an appeal from a state court for want of a substantial federal question operates as a decision on the merits on the challenges presented in the statement of jurisdiction." White v. White, 731 F.2d 1440, 1443 (9th Cir.1984) (citing Carpenters Pension Trust v. Kronschnabel, 632 F.2d 745, 747 (9th Cir.1980), cert. denied, 453 U.S. 922, 101 S.Ct. 3159, 69 L.Ed.2d 1004 (1981)). See also Armstrong v. Armstrong, 696 F.2d 1237, 1238 (9th Cir.1983).
Although we recognize that Erspan, Smith, Sheldon and the other cases cited concerned the retroactive application of McCarty to already existing marital awards, we believe their rationale is applicable to the case at bar. As were the courts deciding those cases, we too are faced with an award of a military pension that was impermissible under existing federal law; and also as were those courts, we are faced with a collateral challenge to the erroneous award of a military pension. Similarly, we conclude that the award of a military disability pension was not made without subject matter jurisdiction, and thus it could not be collaterally challenged a year after it was entered. Cf. Steel v. U.S., 813 F.2d 1545, 1548 (9th Cir.1987) (The new act "does not create [subject-matter] jurisdiction, but grants power to courts once they have jurisdiction."). Appellee's recourse to the allegedly erroneous award should have been a timely appeal. His failure to do so prevents him from raising the issue now.
JUDGMENT REVERSED; ORIGINAL ORDER OF MARCH 29, 1985 REINSTATED. APPELLEE TO PAY THE COSTS.
NOTES
[1] The parties now agree that Robert's pension was a military disability pension.
[2] The Court of Appeals of Maryland subsequently held in Hill v. Hill, 291 Md. 615, 436 A.2d 67 (1981), that the rationale of McCarty applied with equal force to "a division of property" in an equitable distribution state such as Maryland. Thus, the Hill court held that a military pension could not be considered marital property. The Hill court did not consider "[T]he question whether federal law precludes the division of veteran's disability benefits...." Id. at 621, 436 A.2d 67.
[3] The legislative history of 10 U.S.C. § 1408 specifically states:
The primary purpose of the bill is to remove the effect of the United States Supreme Court decision in McCarty v. McCarty, 453 U.S. 210 [101 S.Ct. 2728, 69 L.Ed.2d 589] (1981).
S.Rep. No. 97-502 on Title X of Pub.L. 97-252, 97th Cong., 2d session, reprinted in 1982 U.S.Code Cong. & Ad.News 1555, 1596.
[4] The original order of the trial judge which supposedly classified the military disability pension as marital property was issued in March of 1985. The trial judge granted the motion to amend or revise judgment in September of 1987.
[5] Appellant claims the judge did not award the disability pension as marital property but rather simply ordered a monetary payment "to adjust the parties' equity in marital property." Inasmuch as we hold that the trial judge was not empowered to revise the judgment whether there was error or not, we need not reach this issue. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2586228/ | 162 P.3d 1095 (2007)
213 Or. App. 587
CARROLL
v.
BOARD OF PAROLE AND POST-PRISON SUPERVISION.
Court of Appeals of Oregon.
June 20, 2007.
Affirmed without opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919116/ | 912 So. 2d 603 (2005)
STATE of Florida, Appellant,
v.
Mathew Sabastian MENUTO, Appellee.
No. 2D03-4838.
District Court of Appeal of Florida, Second District.
May 4, 2005.
*605 Charles J. Crist, Jr., Attorney General, Tallahassee, and Marilyn Muir Beccue, Assistant Attorney General, Tampa, for Appellant.
Jawdet I. Rubaii and Jack F. White, III, of Jawdet I. Rubaii, P.A., Clearwater, for Appellee.
WALLACE, Judge.
When the trial court dismissed the information against Mathew Sabastian Menuto, it held that section 790.23(1)(b), Florida Statutes (2002), was unconstitutional. We agree with the State that the statute withstands Menuto's constitutional challenges, and we reverse.
The information alleged that in December 2002, Menuto was under twenty-four years of age when he had in his care, custody, possession, or control a firearm. The information further alleged that six years earlier, Menuto, as a juvenile, had been found to have committed burglary of a dwelling, which was a delinquent act that would have been a felony if committed by an adult. The information alleged that these facts constituted a violation of section 790.23, which provides, in pertinent part:
(1) It is unlawful for any person to own or to have in his or her care, custody, possession, or control any firearm. . . if that person has been:
(a) Convicted of a felony in the courts of this state;
(b) Found, in the courts of this state, to have committed a delinquent act that would be a felony if committed by an adult and such person is under 24 years of age.
For the purpose of section 790.23(1)(a), "conviction" means "adjudication of *606 guilt"a mere withhold of adjudication of guilt of the prior offense will not suffice. See Malcolm v. State, 605 So. 2d 945, 948 (Fla. 3d DCA 1992) ("[T]he defendant pled guilty to the charge and the trial court withheld adjudication of guilt; this means that the defendant was never convicted of this felony, and that, accordingly, he could not, as we have squarely held, be convicted of unlawful possession of a firearm by a convicted felon based on such a withhold of adjudication."); accord Castillo v. State, 590 So. 2d 458 (Fla. 3d DCA 1991); Burkett v. State, 518 So. 2d 1363 (Fla. 1st DCA 1988).
By contrast, a violation of section 790.23(1)(b) requires that the person has been "found" to have committed the prior offense. In a juvenile proceeding, a finding that the child has committed a delinquent act or violation of law occurs when the court withholds adjudication of delinquency and when the court adjudicates the child delinquent. § 985.228(4), Fla. Stat. (2002).[1]
Moving to dismiss the information, Menuto alleged that in the prior juvenile proceeding, he had not been adjudicated delinquent; rather, adjudication of delinquency had been withheld. Menuto argued that the statute was incongruous, requiring an adjudication of guilt to prove a violation of section 790.23(1)(a) but permitting a violation of section 790.23(1)(b) to be proved without an adjudication of delinquency. In his motion, he characterized his constitutional challenges as follows: "[T]he statute is vague, both facially and as applied to [Menuto], and further that the statute violates equal protection and is arbitrary and capricious, both facially and as applied.. . ." In the alternative, Menuto requested the court to construe the phrase "[f]ound . . . to have committed a delinquent act" in section 790.23(1)(b) to require an adjudication of delinquency.
Procedural Due Process
In substance, Menuto's equal protection argument implicated due process more than equal protection. "It is the Due Process Clause that protects the individual against the arbitrary and unreasonable exercise of governmental power." State v. Robinson, 873 So. 2d 1205, 1209 (Fla.2004). "[T]he equal protection clause is only concerned with whether the classification pursuant to a particular legislative enactment is properly drawn. Procedural due process is the constitutional guarantee involved with a determination of whether a specific individual is placed within a classification." Id. (quoting Westerheide v. State, 831 So. 2d 93, 110-11 (Fla.2002)). Menuto does not question the legislature's wisdom in creating the classifications represented by subsections (1)(a) and (1)(b) because he admits that those juveniles adjudicated delinquent are properly included in subsection (1)(b). Rather, he questions his placement within subsection (1)(b) because his adjudication of delinquency was withheld. Accordingly, we first consider Menuto's constitutional challenge as a matter of procedural due process.
Section 790.23 does not infringe upon a fundamental right. Therefore, under the constitutions of the United States and Florida, to "comply with the constitutional guarantee of due process, a state statute must bear a reasonable relationship to a permissible legislative objective." Lite v. State, 617 So. 2d 1058, 1059 (Fla. 1993). "Further, the statute must not be discriminatory, arbitrary, or oppressive." Id. at 1059-60.
*607 As an element of the offense prohibited by section 790.23(1), subsection (1)(a) requires that the person has been "[c]onvicted of a felony." Subsection (1)(b) requires that the person has been "[f]ound . . . to have committed a delinquent act that would be a felony if committed by an adult." The difference between subsections (1)(a) and (1)(b) is not arbitrary; rather, it recognizes the fundamental difference between criminal proceedings and juvenile proceedings.
The primary purpose of criminal sentencing is to punish. § 921.002(1)(b), Fla. Stat. (2002). In sharp contrast, the ultimate aim of juvenile proceedings is to rehabilitate. P.W.G. v. State, 702 So. 2d 488, 491 (Fla.1997) (adopting the district court's reasoning); see also § 985.02 (emphasizing rehabilitative and preventative goals, as well as protection of the public, as the primary aims of the juvenile justice system).
A juvenile proceeding begins when the Department of Juvenile Justice files a petition alleging that a child has committed a delinquent act. If, after an evidentiary hearing, the trial court finds that the child has not committed a delinquent act, the petition must be dismissed. § 985.228(3). If the trial court finds that the child has committed a delinquent act, a myriad of options are available to the trial court. By withholding adjudication, the court may place the child in community-based rehabilitative programs as a condition of juvenile probation. Then, "[i]f the court later finds that the child has not complied with the rules, restrictions, or conditions of the community-based program, the court may . . . enter an adjudication of delinquency and shall thereafter have full authority under this chapter to deal with the child as adjudicated." § 985.228(4). Thus the adjudication of delinquency is not related to the finding that the child committed the delinquent act. Rather, the adjudication of delinquency is a device by which the court empowers itself to impose a more restrictive disposition upon the child (such as ordering him to secure detention) in order to effectuate the child's rehabilitation or to protect the public.
Menuto assumes that a "conviction" is equivalent to an "adjudication of delinquency." It is not. See § 985.228(6) (providing, with exceptions not relevant here, that "an adjudication of delinquency by a court with respect to any child who has committed a delinquent act or violation of law shall not be deemed a conviction; nor shall the child be deemed to have been found guilty or to be a criminal by reason of that adjudication").
Menuto further assumes that a "withhold of adjudication of guilt" is equivalent to a "withhold of adjudication of delinquency." However, the juvenile justice system does not recognize the concept of "guilt." See § 985.228(6). Moreover, as a matter of procedure, it is possible in a criminal proceeding for the court to impose a sentence following a withhold of adjudication of guilt without a finding of guilt. See Walker v. State, 880 So. 2d 1262, 1264 (Fla. 2d DCA 2004) (noting that a withhold of adjudication of guilt pursuant to a no contest plea does not constitute a "finding of guilt"). In juvenile proceedings, a finding that the child has committed a delinquent act must precede a withhold of adjudication of delinquency; otherwise the delinquency petition must be dismissed. § 985.228(3). Because Menuto's argument is built upon the equivalence of these "apples and oranges," the argument fails.
Menuto cites cases that loosely employ some of the language of criminal law to describe juvenile proceedings. E.g., C.C.B. *608 v. State, 782 So. 2d 473, 478 (Fla. 4th DCA 2001) (noting that section 790.23 made it unlawful for a person to possess any firearm if the person had been "convicted" of a delinquent act); W.J. v. State, 688 So. 2d 954, 957 (Fla. 4th DCA 1997) (employing the same language). However, those cases concerned the permissible scope of a condition of juvenile probation. We do not believe that the authors of those opinions intended to criminalize juvenile proceedings.
Equal Protection
Because section 790.23 does not adversely affect a suspect class or a fundamental right, "the rational basis standard is applied to determine whether [the statute] denies equal protection" under the federal and Florida constitutions. Lite, 617 So.2d at 1060. "Under the rational basis standard, the party challenging the statute bears the burden of showing that the statutory classification does not bear a rational relationship to a legitimate state purpose." Id. For the reasons explained above, the classifications created by subsections (1)(a) and (1)(b) are rationally related to the difference between criminal and juvenile proceedings. We find no violation of equal protection.
Within subsection (1)(b), there is a class of people under age twenty-four for whom a prior finding of a commission of a delinquent act will be an element of the offense prohibited by section 790.23(1). A second class of people age twenty-four and above with a juvenile record will not be so adversely affected if they possess a firearm. The trial court cited this disparity as an additional reason to find section 790.23 unconstitutional.
Section 790.23(1)(b) reflects the proper exercise of legislative prerogative. Chapter 99-284, section 39, at 3133, Laws of Florida, substantially rewrote section 790.23, including the addition of the provision drawing a line at age twenty-four. Under the old version, if the prior offense was a delinquent act, the person had to be under the jurisdiction of the juvenile court at the time he committed the possession offense in order to be subject to section 790.23. If the juvenile court no longer had jurisdiction over the person (because he reached age nineteen, for example), then the person could not be held to account for violating section 790.23's prohibition on possession of a firearm by a person found to have committed a delinquent act. See State v. Brown, 745 So. 2d 1006 (Fla. 2d DCA 1999) (considering section 790.23(2), Fla. Stat. (Supp.1998)). In other words, once the child reached majority, the prior juvenile offense could no longer be used to support a violation of section 790.23 when he possessed a firearm as an adult.
Chapter 99-284 raised the age at which the person would be held responsible for the prior juvenile offense. In the new version, age twenty-four was selected as the age at which the person could possess a firearm without violating section 790.23. We view the selection of age twenty-four as the sort of legislative line-drawing that is the proper function of the legislature. Because it is rationally related to the legitimate goal of reducing the potential harm of recidivist ex-juvenile offenders who possess firearms within a relatively short time after attaining majority, we find no violation of equal protection.
Vagueness
Substantive due process implicates the vagueness doctrine, which requires that "a statute gives a person of ordinary intelligence fair notice of what constitutes forbidden conduct. The language of the statute must provide a definite warning of what conduct is required or prohibited, measured by common understanding and practice." Sieniarecki v. *609 State, 756 So. 2d 68, 74 (Fla.2000) (citations and internal quotations omitted). When applying the vagueness doctrine,
the traditional rule is that a person to whom a statute may constitutionally be applied may not challenge that statute on the ground that it may conceivably be applied unconstitutionally to others in situations not before the Court. If the record demonstrates that the [person] engaged in some conduct clearly proscribed by the plain and ordinary meaning of the statute, then [he] cannot successfully challenge it for vagueness nor complain of its vagueness as applied to the hypothetical conduct of others.
Id. (citations and internal quotations omitted). Thus, in undertaking a vagueness analysis under the federal and Florida constitutions, the appellate court should "examine the complainant's conduct before analyzing other hypothetical applications of the law." Id. at 75.
Here, Menuto's conduct fell squarely within the meaning of the statute. A court of this state found that Menuto had committed a delinquent act that would be a felony if committed by an adult, regardless of the disposition ordered upon such finding. For this reason, the statute was not vague as applied to him, and he lacks standing to assert a facial vagueness claim.
Statutory Construction
Alternative to his constitutional challenges, Menuto contends that section 985.228(7) and the heading of section 790.23, when read in pari materia with section 790.23(1)(b), require the phrase "[f]ound . . . to have committed a delinquent act" in section 790.23(1)(b) to be construed as requiring an adjudication of delinquency. We do not agree.
The heading of section 790.23 is "Felons and delinquents; possession of firearms or electric weapons or devices unlawful." Menuto believes that the inclusion of "delinquents" and the exclusion of those whose adjudication had been withheld excludes the latter from the meaning of section 790.23(1)(b).
"Legislative intent is the polestar that guides a court's statutory construction analysis." Bautista v. State, 863 So. 2d 1180, 1185 (Fla.2003). The court first should look to the actual language of the provision in question. Id. Infrequently, the section headings within the codified Florida Statutes may be helpful in construing an ambiguous statute. Fajardo v. State, 805 So. 2d 961, 963 (Fla. 2d DCA 2001). However, the rules of construction can only be invoked when a statute is ambiguous. Id. In this case, section 790.23(1)(b) is clear on its face; thus we need not look to the section heading.
Further, reading section 985.228(7) in pari materia with section 790.23 does not aid Menuto's cause. Section 985.228(7) was enacted together with the revision to section 790.23. Ch. 99-284, § 38, at 3133, Laws of Fla. It provides: "Notwithstanding any other provision of law, an adjudication of delinquency for an offense classified as a felony shall disqualify a person from lawfully possessing a firearm until such person reaches 24 years of age." This is the last subsection of the section governing adjudicatory hearings and orders of adjudication in delinquency cases.
Section 985.228(7), standing alone, might imply that juvenile dispositions other than adjudication of delinquency would not disqualify a person from lawfully possessing a firearm. However the phrase, "[n]otwithstanding any other provision of law" alerts the reader that other provisions may impact the force and effect of section 985.228(7).
*610 Section 790.23 is such a provision. It is both more specific and broader in application than section 985.228(7) in three respects. First, the finding that the person committed a delinquent act required by section 790.23 necessarily encompasses the adjudication of delinquency required by section 985.228(7). Second, section 790.23 prohibits possession of more items than the firearms mentioned in section 985.228(7); these items include a tear-gas gun, an electric weapon or device, and a chemical weapon or device. Third, section 790.23(3) provides that "[a]ny person who violates this section commits a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084." There is no penalty associated with section 985.228(7), and it does not describe the consequences of possessing a firearm when one is disqualified to do so. Thus it is apparent that section 985.228(7) does not withstand section 790.23; section 790.23 swallows it whole. Section 985.228(7) does not support a construction of section 790.23(1)(b) other than its plain meaning.
Conclusion
We reverse the order dismissing the information against Menuto, and we remand for further proceedings.
Reversed.
STRINGER and VILLANTI, JJ., concur.
NOTES
[1] For the purpose of this opinion, statutes cited herein related to juvenile proceedings are comparable to statutes in effect at the time of Menuto's juvenile disposition. Compare §§ 985.02, 985.228, Fla. Stat. (2002), with §§ 39.002, 39.053, Fla. Stat. (1995). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919131/ | 912 So. 2d 1118 (2005)
NORTH BILOXI DEVELOPMENT CO., L.L.C., f/k/a Highway 67 Development Co., L.L.C., Appellant
v.
MISSISSIPPI TRANSPORTATION COMMISSION, Appellee.
No. 2004-CA-00781-COA.
Court of Appeals of Mississippi.
October 18, 2005.
*1121 Virgil G. Gillespie, Gulfport, attorney for appellant.
Jack Homer Pittman, Hattiesburg, attorney for appellee.
EN BANC.
KING, C.J., for the Court.
¶ 1. This appeal comes to this Court from the Special Court of Eminent Domain of the Second Judicial District of Harrison County. The landowner, North Biloxi Development Co., LLC, disputes the amount awarded to it by a jury for about seventy-two acres its property taken by eminent domain by the Mississippi Transportation Commission for construction of a highway. North Biloxi Development Co., LLC appeals and asserts the following errors:
I. Whether the trial court erred in granting instruction No. P-2 over the objection of the appellant.
II. Whether the trial court erred in granting instruction No. P-4 over the objection of the appellant.
III. Whether the trial court erred in granting instruction No. P-5 over the objection of the appellant.
IV. Whether the trial court erred in granting instruction No. P-6 over the objection of the appellant.
V. Whether the trial court erred in failing to grant instruction No. D-6 in favor of the appellant.
VI. Whether the trial court erred in allowing the jury to hear testimony less than the sum of $594,700, which was the amount of the original statement of value and the approved appraisal. This question was presented to the court at various times throughout the court and the court consistently held against the appellant in this regard.
VII. Whether the trial court erred in its ruling on the motion to limit filed by the appellant prior to trial regarding the appellee's use or nonuse of timber values in the appraisal.
VIII. Whether the trial court erred in overruling the appellant's motion for new trial.
Finding no error, we affirm.
FACTS
¶ 2. On August 2, 2001, the Mississippi Transportation Commission, (MTC), filed a complaint to condemn about seventy-two acres owned by North Biloxi Development Company, LLC (North Biloxi Development) in Harrison County for construction of a new highway from Interstate-10 to the Cowan-Lorraine Road Extension. MTC sought 71.814 acres for the project of North Biloxi Development's total acreage of 987.952. The acquisition also included limiting access to and from the new highway except in seven designated locations.
¶ 3. On the date of the taking, August 2, 2001, North Biloxi Development's land was in a single contiguous parcel undivided except that Mississippi Highway 15 ran *1122 through the easternmost part of the land placing approximately 16 acres on the east side of Highway 15 and the rest of the property on the west side. The MTC taking made an arc through the landowner's property dividing it into six separate and non-contiguous parcels. The nearly 988 acres of the landowner was located approximately two miles north of Interstate-10 and near the city limits of Biloxi and D'Iberville. Twenty eight acres of the approximate seventy-two acres of land to be taken by MTC was wetlands. North Biloxi Development total wetlands acreage is 347.
¶ 4. Shortly after August 2, 2001, the date of the taking, the court-appointed appraiser, Jeanne S. Adams of Gulfport, placed the value of the property at $323,000. On October 18, 2001, a quick take order was entered by the court giving MTC title to the property and the right of immediate possession. On November 16, 2001, MTC deposited a total of $589,515 into the registry of the Circuit Clerk of Harrison County for the quick take. The court allowed $1,000 of the funds to be paid to the court-ordered appraiser. By order filed January 3, 2002, the court directed the clerk to disburse $588,515 and any accrued interest to Gulfport attorney Virgil G. Gillespie, in trust, in order to obtain a release of a deed of trust on the property held by Peoples Bank of Biloxi, and upon such release being obtained the court ordered to disburse the balance of the funds to North Biloxi Development. (Peoples Bank and Lyle M. Page, trustee under the deed of trust, had been originally named as defendants.)
¶ 5. On August 16, 2002, MTC filed its statement of value, pursuant to Mississippi Code Annotated section 11-27-7 (Rev.2004), placing the fair market value of the property at the date of the taking at $461,865 with damages to the remainder of the property valued at $132,835 for a total compensation to the landowner of $594,700. The statement listed the elements of damages as "proximity damages." The statement said the highest and best use of the property was for residential development.
¶ 6. On January 14, 2003, MTC filed an amended statement of value placing the fair market value of the property at $461,860 and damages to the remainder at $6,365 for a total compensation of $468,225. The amended statement listed the elements of damage as "loss in value due to shape and uneconomic remnant." On April 29, 2003, MTC filed a second amended statement of value placing the fair market value of the acreage to be taken at $462,735, with damages to the remainder at $6,365, for a total compensation of $469,100. The second amended statement of value listed the elements of damage as "proximity damage." (The reasons for changes in MTC's statement of value will be set out in our discussion of the issues.) MTC's statement said the highest and best use for the property was residential development. On February 4, 2004, North Biloxi Development filed its statement of value placing the fair market value of the property to be taken at $466,791 and damage to the remainder at $1,488,485 for a total compensation of $1,955,276. The landowner listed the elements of damages as "severance, dividing the property into smaller parcels, taking the high ground of the property, increase in wetlands factor, decrease in highlands, market diminution in value, and other depreciation factors resulting from a severance and taking of this nature and magnitude." The statement said the highest and best use of the land was for a residential subdivision or golf course/residential development.
¶ 7. On May 8, 2003, an order was entered dismissing the Peoples Bank from *1123 the action since the bank had no further interest in the property and adding BankcorpSouth and J. Patrick Caldwell as defendants due to a deed of trust on the property recorded on October 11, 2001.
¶ 8. On May 9, 2003, the three judges of the County Court of Harrison County recused themselves because two of the litigants, William L. Guice, III, and Bobby G. O'Barr, were members of the bar practicing before the county court. T. Larry Wilson of Pascagoula was appointed to preside over the case.
¶ 9. A two-day trial began on February 18, 2004, before twelve jurors. The second day of trial the jury was taken to view the property. Construction on the new highway had already begun. Following the viewing, MTC called three witnesses, Bradley K. Anderson, project engineer for the Mississippi Department of Transportation (MDOT); Charles Walters, an environmental scientist; and William B. Milton, a real estate appraiser who had twenty-five years of prior experience with MDOT. Milton testified that the value of North Biloxi Development's total acreage (987.952 acres) before the taking was $5,977,110, and he said the value of the remaining 914.171 acres after the taking was $5,536,270. Milton testified that the fair market value of the property taken by MTC was the difference in the before value and the after value or $440,840. The landowner called but one witness, J. Daniel Schroeder, a certified general appraiser from Biloxi. Schroeder testified that the before value of North Biloxi Development's acreage was $6,421,688 and the after value was $4,466,411.95 with the difference between the two being $1,955,276 which he said was just compensation. The jury returned a verdict in the amount of $572,221.14 as just compensation to North Biloxi Development for MTC's acquisition of about seventy two acres of its property. A final judgment was entered on April 8, 2004. North Biloxi Development's motion for a new trial was denied and this appeal ensued. Further facts will be set out during the discussion of the issues.
ISSUES AND ANALYSIS
ISSUES I., II., III., AND IV.
Whether the trial court erred in granting instructions No. P-2, P-4, P-5 and P-6 over the objection of the appellant
¶ 10. Because issues I., II., III., and IV. deal with instructions given to the jury over the objection of North Biloxi Development, we will address these four assignments of error together.
¶ 11. The standard of review which we employ when reviewing jury instructions on appeal is that we must read the instructions as a whole. Entergy Mississippi, Inc. v. Bolden, 854 So. 2d 1051, 1054(¶ 6) (Miss.2003). An instruction that incorrectly states the law, is covered fairly in another instruction or is without foundation in the evidence need not be given. Heidel v. State, 587 So. 2d 835, 842 (Miss.1991). The main query we make when reviewing jury instructions is whether (1) the jury instruction contains a correct statement of the law and (2) whether the instruction is warranted by the evidence. Seigfried v. State, 869 So. 2d 1040, 1044(¶ 11) (Miss.Ct.App.2003).
(a) Jury Instruction P-2
¶ 12. North Biloxi Development alleges that the trial court erred in granting MTC's Jury Instruction P-2[1]. The *1124 landowner contends that it was unnecessary for the jury to be told there was a deposit of funds for the benefit of the landowner. It argues that the instruction was confusing in that by telling the jury that there had been a deposit of funds for the landowner, the instruction implied that the landowner had already received some money over and above what the jury may award. North Biloxi Development asserts that because of the instruction, the jury would base its opinion on speculation and conjecture.
¶ 13. Instruction P-2 outlines the statutory authority of MTC to secure land for highway purposes and instructs the jury that MTC had already gained title and possession of the property by an October 18, 2001, order of the court. Further the instruction tells the jury that in its decision to award compensation, it should not consider the fact that MTC had already acquired the property and had begun construction of the new highway.
¶ 14. We find no error in this instruction. On the second day of trial the jury was taken to the property to view it in accordance with Mississippi Code Annotated section 11-27-19 (Rev.2004). Instruction P-2 was necessary to explain the authority of MTC to take a property by eminent domain and was a correct statement of the so-called "quick take law," Mississippi Code Annotated §§ 11-27-81 to -91 (Rev.2004). The fact that the instruction tells the jury that there had been a deposit of funds for the benefit of the landowner by MTC is no more than a summary of Mississippi Code Annotated § 11-27-85(2) (Rev.2004). That section states that the party seeking to take the property by eminent domain must deposit with the clerk of court eight-five percent of the value of the property as determined by the court-appointed appraiser in order to obtain title to the property and the right of immediate entry onto it. It is true, as North Biloxi Development points out, that the October 18, 2001, date used in the instruction was not the date of the taking, that date being August 2, 2001. However, the instruction only references October 18, 2001, as the date when the quick take order was entered by the court in favor of MTC and does not imply or state that the date should be used by the jury as the date for determining a valuation of the property. The instruction provided a correct statement of the statutory procedure involved in eminent domain and instructed the jury that in its consideration of damages after it viewed the property the jury was not to consider the fact that MTC was already on the property working on the new highway.
¶ 15. North Biloxi Development's argument, that Instruction P-2 should have been refused because it implies that the landowner has already received some funds and thus the jury would be mislead, lacks merit. North Biloxi Development's Instruction D-5 instructs the jury that North Biloxi Development is entitled "to recover just compensation in this cause, and it devolves upon [the jury to] honestly and impartially determine the sum thereof, according to the evidence adduced at trial, the weight and credibility of which you are the sole judge." Instruction D-5 further states that North Biloxi Development is entitled to "just compensation, not only for *1125 the value of the property to be actually taken," . . . but also for damages "which may result as a consequence of the taking." Instruction D-5 told the jury that it was not to deduct anything because of the supposed benefits incident to the public use for which the taking was made. We note also that the jury was told in opening statements and in final arguments and in the testimony about the established minimum and maximum amounts that it could award to North Biloxi Development.
¶ 16. When all of these facts are considered, we find that Instruction P-2 was a correct statement of the law and was warranted by the trial evidence. Thus we find no error in this instruction.
(b) Jury Instruction P-4
¶ 17. North Biloxi Development argues that Instruction P-4[2] should not have been given because it provided comment on a specific element of damages. The landowner argues that the instruction was faulty as a matter of law because it was an improper comment on a particular aspect of the damages, "reasonable access." According to North Biloxi Development the instruction does not instruct the jury as to what "reasonable access" is and does not tell the jury that the determination of "reasonable access" is a fact to be determined by expert testimony. The landowner cites Mississippi State Highway Comm'n v. Crooks, 282 So. 2d 232, 235 (Miss.1973) in support of its argument. In Crooks the court reviewed an instruction which told the jury that changing the size and shape and severing one parcel of land from the other was an element of damages and the jury could award damages if it believed that the changes in the land affected the before and after fair market value of land. Id. The court said that the before and after taking rule is the ultimate measure of damages in an eminent domain case. Id. (citing Mississippi State Highway Comm'n v. Hall, 252 Miss. 863, 174 So. 2d 488 (1965)). The Crooks court found that the giving of the instruction was in error, but it held that when considering all of the instructions together and the fact that the jury had been properly instructed, the giving of the instruction was merely harmless error.
¶ 18. Instruction P-4 tells the jury that where access to the property is altered and the landowner is left with reasonable access to the rest of its property, no damages should be awarded by the jury to North Biloxi Development for the alteration in its access.
¶ 19. MTC cites Maples v. Mississippi State Highway Comm'n, 617 So. 2d 265 (Miss.1993) in support of giving the instruction. In Maples the landowner argued that an instruction was confusing and misleading that instructed the jury that in assessing the landowner's damages "the jury shall not consider any elements of inconvenience or other elements [of damages] which are speculative and remote." The court held that any error in granting the instruction was harmless because the jury was obviously not mislead because its award contained several thousand dollars as compensation for the landowner's loss of access. Id. at 270. In essence the Maples court allowed the jury to determine the reasonableness of access and to assess damages based upon that reasonableness.
¶ 20. We find that Instruction P-4 was an accurate statement of the law as set out *1126 in Maples. The record shows that after the taking North Biloxi Development was left with seven access points from the new highway to its remaining property. As in Maples, the jury had to decide whether there was reasonable access left to the property in its "after" condition. North Biloxi Development's expert appraiser, Schroeder, testified that there were damages to the "after" property based on restriction of access. The jury awarded North Biloxi Development several thousand dollars more than what MTC offered it which indicates to us that the jury did award some damages for the lack of access. We find no error in the giving of Instruction P-4.
(c) Jury Instruction P-5
¶ 21. North Biloxi Development next contends that Instruction P-5[3] should not have been given. It argues that the giving of Instruction P-5 is the error in this appeal "that cannot be overlooked" because the statement in the instruction to "disregard" testimony goes beyond the jury's role which instead belongs to the trial court exercising its gatekeeper role to determine whether expert testimony is relevant and reliable. In support of its argument North Biloxi Development cites Mississippi Transp. Comm'n v. McLemore, 863 So. 2d 31, 36-7(¶ 25) (Miss.2003) for the proposition that the trial court is vested with a "gatekeeping responsibility" regarding the admission of expert testimony. The landowner states that since the decision in McLemore a jury cannot be instructed to "disregard testimony" since such an instruction invades the gatekeeping function of the trial court.
¶ 22. Instruction P-5 instructs the jury to determine the credibility of the appraisers for both MTC and North Biloxi Development, including assessing whether there was speculation and guesswork involved in making their appraisals or whether the appraisals were the result of reliable principles and methods. The supreme court has held that in eminent domain cases, "[t]he jury may disregard the testimony of a witness whose testimony the jury has reasonable grounds to believe is worthless." Warren County v. Harris, 211 Miss. 80, 88, 50 So. 2d 918, 920 (1951). Both parties presented evidence by way of experts of the appraised value of the property. We note that the instruction did not say which expert testimony to disregard. Further Instruction P-6, which will be discussed in detail infra, instructed the jury that it was the sole judge of the weight and credibility of the evidence and of the evidence's reasonableness. We find that Instruction P-5 when read together with Instruction P-6 contains a correct statement of the law. Therefore, we find no merit to this issue.
(d) Jury Instruction P-6
¶ 23. North Biloxi Development next contends that Instruction P-6[4] was improperly granted because it required the *1127 applicability of the "before and after rule," that the landowner claims was incorrectly given in Instruction P-3. The landowner states in its reply brief that Instruction P-6 "is quite frankly about as bad a worded instruction as can be given on how the jury is to arrive at its verdict." The crux of North Biloxi Development's argument is that because Instruction P-3, which set out the before and after rule, was so poorly worded, the jury would not have been able to understand Instruction P-6 which references the before and after rule.
¶ 24. First we note that North Biloxi Development made no objection at trial to the offending Instruction P-3 which it now claims when read together with Instruction P-6 confused the jury. Our well-settled doctrine is that the issue of an erroneous jury instruction is deemed waived for appeal unless there is a contemporaneous objection made to the instruction at the trial. HWCC-Tunica, Inc. v. Jenkins, 907 So. 2d 941, 944(¶ 7) (Miss.2005). Secondly the landowner failed to cite any authority for its position. The failure to offer any legal authorities to support an alleged error may act as a procedural bar to our consideration of the error. Murphy v. State, 798 So. 2d 609, 616(¶ 26) (Miss.Ct.App.2001). For all of the foregoing reasons, we decline to find error in the giving of Instruction P-6. This error is without merit.
ISSUE V.
Whether the trial court erred in failing to grant instruction No. D-6 in favor of the appellant
¶ 25. North Biloxi Development contends that the denial of its Instruction D-6[5] denied the jury the right to know that the eminent domain proceeding was the only time in which the landowner would be paid for its property. The landowner cites Mississippi State Highway Comm'n v. Spencer, 209 So. 2d 821, 824 (Miss.1968) for its position. Spencer, however, is readily distinguishable from the case sub judice. The court in Spencer upheld the giving of an instruction which told the jury in part that the landowner would receive no other recovery at a later date. Id. at 824. However, the reason the Spencer court approved the instruction was because the eminent domain taking involved was for a two-phase project and the highway commission's engineer testified that it was not known if and when the second phase of the project would be done. Id. The testimony in the case at bar was that the taking was a one-time project for the highway construction. There was no evidence that any future or latent damages would result because of the acquisition of the property.
¶ 26. A party is entitled to have the jury instructed regarding a genuine issue of material fact, as long as there is credible evidence in the record which will support the instruction. Southland Enters., Inc. v. Newton County, 838 So. 2d 286, 289(¶ 8) (Miss.2003). However, it is error to grant an instruction which is likely to mislead or confuse the jury as to the principles of law which are applicable to the facts in evidence. Id at (¶ 9). In denying the instruction the trial court ruled that Instruction D-6 was too confusing and had no basis in the record. We *1128 agree. After a review of the testimony, we find that there was no reference to any future or latent effects the acquisition might have on the landowner's property. Also the instruction tells the jury that "no recovery" to the landowners will be allowed for the taking at a later date. This instruction could be interpreted by the jury to mean that MTC could take additional property from North Biloxi Development without paying the landowner any additional compensation. Such an interpretation would be erroneous and thus the jury could be confused. We find that the trial court was correct in rejecting the instruction. Therefore, we find no merit to this error.
ISSUE VI.
Whether the court erred in allowing the jury to hear testimony less than the sum of $594,700, which was the amount of the original statement of value and the approved appraisal. This question was presented to the court at various times throughout the court and the court consistently held against the appellant in this regard.
¶ 27. North Biloxi Development contends that the trial court erred in allowing the jury to hear testimony by MTC of a value for the property less than the sum of $594,000, the valuation listed by MTC in its original statement of value filed on August 16, 2002. The landowner contends that under the Real Property Acquisition Policies Law, Mississippi Code Annotated §§ 43-37-1 to -13 (Rev.2004), MTC could not pay the landowner an amount which was less than the deposited amount, unless it was due to physical deterioration of the property which was within the reasonable control of the owner. North Biloxi Development states that MTC should be bound by the original statement of value placing the value of the seventy two acres at $594,000.
¶ 28. In its brief North Biloxi Development makes an impassioned argument regarding the limitation of the sovereign's power of eminent domain as measured against a citizen's right to own and enjoy his or her property.
¶ 29. Our Constitution provides: "Private property shall not be taken or damaged for public use, except on due compensation being made to the owner or owners thereof." ... Miss. Const. Art. 3 § 17 (1890). We agree with North Biloxi Development's statements that when an owner's land is taken for a public use by the sovereign, the owner is entitled to "full payment for it" and that a property owner in an eminent domain civil action should receive a payment of "just compensation." King v. Vicksburg Ry. & Light Co., 88 Miss. 456, 42 So. 204 (1906).
¶ 30. Also we recognize that due compensation in eminent domain cases means "fair market value." Potters II v. State Highway Comm'n, 608 So. 2d 1227, 1231 (Miss.1992). In Potters II the supreme court defined fair market value as the "sales price that would be negotiated between knowledgeable and self-interested persons, one who wants to purchase and one who wants to sell, the seller being under no obligation or compulsion to sell, and the buyer being under no necessity of having the property." Id.
¶ 31. With these principles in mind, we turn to North Biloxi Development's argument that MTC should be bound by its original statement of value of $594,000, and that it was error for the trial court to allow the jury to consider an award of less.
¶ 32. By statute in an eminent domain civil action, a statement of value "shall be treated as pleadings are treated in civil *1129 actions in circuit court." Miss.Code Ann. § 11-27-7 (Rev.2004).
¶ 33. After the filing of the civil action in August 2001 MTC changed the amount of land to be taken and added extra access to a portion it sought to take. MTC's expert appraiser Milton, testified that the $594,000 appraisal was based on the original legal description for the acquisition in 2001. By an agreed order dated April 22, 2003, MTC amended the legal description to add the addition amount of property to be taken and to show the addition of extra access to a portion of North Biloxi Development's remaining property. Because of the changes in the legal description and the extra access, a second appraisal was necessary. We believe that to require MTC to testify to an amount based on an incorrect legal description would potentially allow North Biloxi Development to recover an amount greater than fair market value. The jury heard expert testimony regarding the changes made in the statement of value of the landowner's property and were given the reasons why the valuation was reduced. The jury had full knowledge of the reasons for the change in valuations when it returned a verdict for North Biloxi Development in the amount of $572,221 instead of the $594,700 set out in MTC's original statement of value. Thus we find that the trial court committed no reversible error in its decision to admit testimony on the valuations. This error is without merit.
ISSUE VII.
Whether the trial court erred in its ruling on the motion to limit filed by the appellant prior to trial regarding the appellee's use or non use of timber values in the appraisal
¶ 34. In this error North Biloxi Development objects to the way MTC's appraiser added timber value to its appraisal. North Biloxi Development offers no authority in support of its argument, and pursuant to M.R.A.P. 28(a)(6) we decline to address it. Williams v. State, 708 So. 2d 1358 (¶ 12-3) (Miss.1998). However, we note that the record shows that the landowner got exactly what it asked for regarding the timber values. At the beginning of the trial the landowner objected to including the amount of timber value in MTC's appraisal, a value which totaled $28,260. The testimony was that the timber value was based upon a cruise of the timber in the acquisition area only. The landowner objected to the inclusion of timber values and the court sustained the objection. MTC then moved to amend its statement of value in accordance with the trial judge's ruling and the motion was granted and the timber values were excluded.
ISSUE VIII.
Whether the trial court erred in overruling the appellant's motion for new trial
¶ 35. Finally, North Biloxi Development contends that the trial court erred in overruling its motion for a new trial. This Court applies an abuse of discretion standard to the review of a trial court's denial of a motion for new trial. Allstate Ins. Co. v. McGory, 697 So. 2d 1171, 1174(¶ 13) (Miss.1997). In evaluating the trial court's decision, we review the credible evidence in the light most favorable to the non-moving party, and generally take the credible evidence supporting the claims or defenses of the non-moving party as true. Green v. Grant, 641 So. 2d 1203, 1207 (Miss.1994). When the evidence is so viewed, this Court will reverse only when, upon a review of the entire record, we are left "with a firm and definite conviction that the verdict, if allowed to stand, would work a miscarriage of justice." *1130 Griffin v. McKenney, 877 So. 2d 425, 446(¶ 74) (Miss.Ct.App.2003). In eminent domain cases the supreme court has stated that the standard of review of a jury verdict is that a new trial will not be ordered unless the verdict is so at variance with the evidence as to "shock the conscience of the court." Mississippi Transp. Comm'n v. Bridgforth, 709 So. 2d 430, 441 (¶ 35) (Miss.1998). "We are particularly loathe to disturb a jury's eminent domain award where, as here, the jury personally viewed the premises." Id.
¶ 36. Expert testimony was presented on behalf of each party regarding the value of the property. "The jury is charged with the responsibility of weighing and considering conflicting evidence, evaluating the credibility of witnesses, and determining whose testimony should be believed." Smith v. State, 821 So. 2d 908(¶ 4) (Miss.Ct.App.2002). Accordingly, we find that the evidence in this case was sufficient to support the verdict and that this error is without merit.
¶ 37. THE JUDGMENT OF THE SPECIAL COURT OF EMINENT DOMAIN OF THE SECOND JUDICIAL DISTRICT OF HARRISON COUNTY IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE APPELLANT.
BRIDGES AND LEE, P.JJ., IRVING, MYERS, CHANDLER, GRIFFIS, AND BARNES, JJ. CONCUR. ISHEE, J., NOT PARTICIPATING.
NOTES
[1] Jury Instruction P-2 reads as follows:
"The Mississippi Transportation Commission is entitled to acquire property for Highway purposes through statutory procedures and the deposit of funds for the benefit of the landowner as ordered by the Court. In this case, the Mississippi Transportation Commission was awarded title and possession of the property on October 18, 2001, by Order of this Court. In your decision to award just compensation, you shall not consider the fact that the Mississippi Transportation Commission has acquired the subject property and begun construction of the new highway."
[2] "Jury Instruction P-4 reads as follows:
"The Court instructs the Jury that where access to the subject property is altered, and Defendant is left with reasonable access to its remaining property, then no damages should be awarded to Defendant for such alteration in access."
[3] Jury Instruction P-5 reads as follows:
"The Court instructs the Jury that an appraiser's testimony as it relates to damages and fair market value of the subject property must be based upon sufficient facts or data, be the product of reliable principles and methods, and not based on speculation or guesswork of the appraiser. If it is your opinion that any part of an appraiser's testimony in this case was not supported by sufficient facts or data, or was not the product of reliable principles or methods, you should disregard any such testimony of that appraiser."
[4] "Jury Instruction P-6 reads as follows:
"The Court instructs the Jury that in arriving at your verdict, you must take into consideration all of the evidence in this case, including observations made by you as jurors when you viewed the land; and, that you are the sole judges of the weight and credibility of the evidence and its reasonableness, and that while it is your duty to award Defendants a verdict, the measure of damages and the amount of the verdict to be awarded must not exceed what you have determined to be the fair market value of Defendant's property on August 2, 2001, based on proper application of the before and after rule."
[5] Jury Instruction D-6 reads as follows:
"The Court instructs the Jury that no recovery at a later date will be permitted to the Defendant/Landowner, North Biloxi Development Co., L.L.C., as a result of the taking of its land for the relocation of Highway 67, as shown by the evidence." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919154/ | 116 Pa. Commw. 376 (1988)
541 A.2d 849
Clairton City School District, Appellant
v.
George Mary et al., Appellees.
No. 1384 C.D. 1987.
Commonwealth Court of Pennsylvania.
Argued March 24, 1988.
May 26, 1988.
Argued March 24, 1988, before Judges CRAIG and PALLADINO, and Senior Judge BARBIERI, sitting as a panel of three.
*377 Ira Weiss, Gross and Weiss, P.C., for appellant.
George M. Weis, Weis & Weis, for appellees.
OPINION BY JUDGE PALLADINO, May 26, 1988:
Clairton City School District (Appellant) appeals an order of the Court of Common Pleas of Allegheny County (trial court) dismissing its complaint on a case stated and entering judgment for George Mary and Steven Gooder t/d/b/a Mary and Gooder Insurance Agency (collectively, Agents), and for Maryland Casualty Company, Assurance Company of North America, and Northern Insurance Company of New York (collectively, Insurers).[1] We affirm.
On June 7, 1984, Appellant solicited bids for various insurance coverages to which Agents, on behalf of Insurers, submitted a bid in response to the solicitation. On September 12, 1984, Appellant awarded the insurance contracts to Agents and Insurers for multi-peril, fire, liability, auto, boiler, and machinery coverage at a bid premium of $9,964.00. Neither the bid specifications provided by Appellant nor the bid itself contained any provision regarding cancellation of the insurance policies.
Following the award, Insurers issued their various policies effective October 1, 1984. The policies which were issued contained clauses which provided that either party could cancel the policies upon notice. Shortly thereafter, Insurers cancelled the policies and the parties agree that the cancellations were effected pursuant *378 to the cancellation clauses.[2] Appellant then obtained insurance coverage from other insurers at a premium rate which was $17,602.00 more than the premium rate charged by Insurers.
Appellant instituted an action against Agents and Insurers for breach of contract and sought damages in the amount of $17,602.00 plus interest. The trial court dismissed Appellant's complaint and entered judgment for Agents and Insurers, holding that Insurers had validly cancelled the policies.
On appeal to this court, Appellant contends that because the bid specifications and the bid itself contained no provision for cancellation, a contract without a cancellation provision was formed when the bid was accepted. Appellant asserts that Agents and Insurers were obligated to provide insurance coverage at the quoted price and that cancellation of the policies constituted a breach of contract. Appellant argues that even if a cancellation clause was statutorily required in the insurance policies, Agents and Insurers are nevertheless contractually liable for damages resulting from the cancellation.[3]
Our scope of review is to determine whether the trial court abused its discretion or committed an error of law. See Lynch v. Urban Redevelopment Authority of Pittsburgh, 91 Pa. Commw. 260, 496 A.2d 1331 (1985). In a case stated, we are confined to the facts presented to the court by the parties, and we cannot *379 go outside of the case stated for facts or assume them by way of inference. Wiest v. Mt. Lebanon School District, 457 Pa. 166, 320 A.2d 362, cert. denied, 419 U.S. 967 (1974).
The fact that Appellant "accepted" the bid is not dispositive of the question of Insurers' and Agents' contractual liability. Where the parties contemplate that their agreement cannot be considered complete before it is reduced to writing, no contract exists until the execution of the writing. Essner v. Shoemaker, 393 Pa. 422, 143 A.2d 364 (1958). In this case, the bid specifications did not contain requirements for many of the provisions which are customarily found in insurance policies, but merely outlined the nature of the coverage sought and set forth sufficient information needed by bidders to quote a premium rate.[4] The parties agreed in their "Submission of Case Stated" that the bid specifications anticipated that policies of insurance would be issued upon Appellant's making the award. Thus, the question remains, by what contractual provisions in the policies as issued are these parties bound?
Insurance contracts are presumed to have been made with reference to substantive law, including applicable statutes in force, and such laws enter into and form a part of the contractual obligation as if actually incorporated into the contract. See First National Bank of Pennsylvania v. Flanagan, 515 Pa. 263, 528 A.2d 134 (1987); Neel v. Williams, 158 Pa. Super. 478, 45 A.2d 375 (1946). Accordingly, the statutory provisions of Pennsylvania insurance law must be deemed incorporated into the policies at issue here. Section 618 of the Insurance Company Law provides that policies of casualty insurance must contain a clause governing cancellation *380 by the insurer and insured. Act of May 17, 1921, P.L. 682, as amended, 40 P.S. §753. Similarly, Section 522 of the Insurance Company Law requires a cancellation clause in all policies of fire insurance. Act of May 17, 1921, P.L. 682, as amended, 40 P.S. §636.
Further, we recognize that in this case, the insurance policies themselves expressly provided for the mutual right of cancellation. Where the right to cancel an insurance policy is expressly reserved in the contract itself, then the extent of the right and the conditions upon which it may be exercised must be determined by reference to the contract. Hanna v. Reliance Insurance Company, 402 Pa. 205, 166 A.2d 877 (1961).
Because Appellant does not dispute that Insurers cancelled the policies in accordance with the cancellation clauses, the trial court correctly concluded that Insurers and Agents were not liable for breach of contract. As the trial court noted, any loss incurred by Appellant was the result of economics of the insurance industry and was not the consequence of any action or inaction on the part of Agents and Insurers.
Accordingly, we affirm.
ORDER
AND NOW, May 26, 1988, the order of the Court of Common Pleas of Allegheny County in the above-captioned matter is affirmed.
NOTES
[1] This case was originally submitted to a board of arbitrators, which rendered a decision in favor of Agents and Insurers on March 21, 1985.
[2] The parties agree that Insurers acted in compliance with the policies' notice provisions and that wrongful cancellation is not an issue in this case. We note that copies of the insurance policies were not included in the record. However, because the parties have agreed to the facts and submitted their dispute as a case stated to the trial court, resolution of the matter is not hindered.
[3] Appellant asserts that Insurers should be found liable vis ą vis Agents under applicable principles of agency law.
[4] The bid specifications did not require bidders to submit copies of the actual policies which they would issue, as part of the bid. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/239166/ | 232 F.2d 211
56-1 USTC P 11,603
Harold O. McLAIN, Executor, etc., Plaintiff-Appellee,v.John R. JARECKI, Individually, etc., Defendant-Appellant.
No. 11527.
United States Court of Appeals Seventh Circuit.
April 17, 1956.
H. Brian Holland, Asst. Atty. Gen., John J. Kelley, Jr., Atty., Dept. of Justice, Washington, D.C., Robert Tieken, U.S. Atty., Chicago, Ill., Robert N. Anderson, Atty., Dept. of Justice, Washington, D.C., for appellant.
Anderson A. Owen, Chicago, Ill., Harry B. Sutter, Harry D. Orr, Jr., James J. McClure, Jr., Chicago, Ill., for appellee. Hopkins, Sutter, Owen, Mulroy & Wentz, Chicago, Ill., of counsel.
Before FINNEGAN, SWAIM and SCHNACKENBERG, Circuit Judges.
FINNEGAN, Circuit Judge.
1
As crystallized by the district judge and the parties to this appeal, the question here is whether 'reciprocal' or 'crossed' trusts are established by the stipulated facts incorporated in findings of fact reported below as McLain v. Jarecki, D.C.N.D.Ill.1955, 126 F. Supp. 621.
2
Appealing from a judgment adverse to it, in favor of plaintiff for $56,983.91, the government asks us to distinguish the current case from Newberry's Estate v. Commissioner, 3 Cir., 1953, 201 F.2d 874, 38 A.L.R. 2d 514 and apply Lehman v. Commissioner, 2 Cir., 1940, 109 F.2d 99, which the district judge refused to follow. We also decline to do so.
3
We are not called upon to construe or interpret any provisions contained in the trusts involved here. Consequently it is unnecessary to reproduce these parts of the stipulated facts. In any event the gist of each trust is clearly and cogently stated in the district court's reported opinion, 126 F. Supp. 621, 622, 623 where through stipulated facts that court described the creation of two separate trusts on December 27, 1934; one by Albert O. McLain, the husband, and the other by Minnie A. McLain, his wife; the similar provisions of the two trusts; and the amendment of both trusts on December 18, 1935.
4
The trust created by the husband, referred to as the Dorothy Trust, provided that the net income of the trust was to be accumulated and added to the principal of the trust until the death of Albert O. McLain, the grantor. After his death the income was to be paid to his wife during her lifetime and after the death of both Albert O. McLain and Minnie A. McLain, the income was to be paid to Dorothy McLain Cole, their daughter, or to her issue. The Dorothy Trust also provided that it could be revoked during the lifetime of the grantor while either Minnie A. McLain or Harold O. McLain, their son, was living, by an instrument in writing signed by Minnie A. McLain, Harold O. McLain and Dorothy McLain Cole, or such of them as were then living, and by all persons affected thereby. As amended in 1935 the Dorothy Trust was modified to permit Harold O. McLain and Minnie A. McLain to terminate the trust during the lifetime of Dorothy McLain Cole or any of her issue. If so terminated, the trust estate was to be distributed to Dorothy McLain Cole, if living, or if she were not living, then to her issue.
5
The trust created by Minnie A. McLain, the wife, contained similar conditions providing for the accumulation of the income during her lifetime, thereafter payment of the income to her husband, and finally termination and distribution to their son, Harold O. McLain, or his issue.
6
The doctrine, if it can rightly be called one, of 'reciprocal' or 'crossed' trusts is a judicial concept (Estate of Louise De Witt Ruxton v. Commissioner, 20 T.C. 487, 494 (1953)) invoked when measuring certain trusts by 811(c)(1)(B) of the Internal Revenue Code of 1939, 26 U.S.C. § 811 (1952 ed.). Specifically the problem before us is whether federal estate taxes were erroneously assessed and collected upon the corpus of a trust created by the decedent's wife, Minnie McLain, construed, by the government's Collector, as being includible in the decedent husband's gross estate by operation of § 811(c)(1)(B) and (d)(2) of the Code.
7
Lehman v. Commissioner, 2 Cir., 1940, 109 F.2d 99, was decided upon fact stipulated at the Board of Tax Appeals level. 1939, 39 B.T.A. 17, 19-20. McLain v. Jarecki, D.C.N.D.Ill.1955, 126 F. Supp. 621, 624, contains an adequate analysis of the Lehman facts, to which we would add this line from the Second Circuit's opinion, 109 F.2d 99, 100: 'The fact that the trusts were reciprocated or 'crossed' is a trifle, quite lacking in practical or legal significance. * * *' But the clue to Lehman lies in the line: 'While section 302(d) (under the 1926 Act) speaks of a decedent having made a transfer of property with enjoyment subject to change by exercise of power to alter, amend or revoke in the decedent, it clearly covers a case where the decedent by paying a quid pro quo has caused another to make a transfer of property with enjoyment subject to change by exercise of such power * * *.' 109 F.2d 99, 100. The short of Lehman is that a person becomes the settlor of a trust if he supplies the consideration, in spite of another person's mechanical declaration of the trust. Hence the Lehman court searched for consideration moving from the decedent to his brother, and having found it affirmed the Board's decision holding the trusts includible in decedent's estate.
8
But among the stipulated facts submitted to us, we find none expressly showing that Albert O. McLain, decedent here, brought about the transfer from his wife, Minnie A. McLain. Because the McLains had substantially identical trusts created concurrently and prepared by their mutual lawyers, the government would have us infer an element of consideration from which to hold that decedent was the actual grantor of the trust in which his wife declared herself to be the grantor. From that argument of course, it would follow that the corpus of the wife's trust would be includible in decedent's gross estate by force of § 811(c) (1)(B) and (d)(2). Both McLains are deceased. Without any oral testimony taken below the usual matter of witnesses' credibility and demeanor evidence is similarly absent here. To reach the inference, indispensable for the government's position, would mean compounding probabilities on the subjective impression we have of the objective stipulated facts. Unlike interpreting written instruments, the government insists upon locating some subjective understanding between the parties that will equate to quid pro quo. But we are, here, relating a situation remote in time and deficient in complete manifestation to § 811. These trusts, and the stipulated facts can also be read as articulating a donative state of mind once extant between the McLains, Newberry's Estate v. Commissioner, 3 Cir., 1953, 201 F.2d 874; Estate of Louise De Witt Ruxton v. Commissioner, 1953, 20 T.C. 487. The district judge's ultimate finding, 126 F. Supp. 621, 625, will stand undisturbed. Chicago Title and Trust Co. v. United States, 7 Cir., 1954, 209 F.2d 773, 775.
9
The judgment of the district court is affirmed and the cause remanded to that court solely for further appropriate action contemplated by the last paragraph (T.R. 107) of the judgment entered March 3, 1955.
10
Judgment affirmed and case remanded.
11
SCHNACKENBERG, Circuit Judge. (dissenting).
12
Defendant relies on Lehman v. Commissioner of Internal Revenue, 2 Cir., 109 F.2d 99, while plaintiff relies on Newberry's Estate v. Commissioner of Internal Revenue, 3 Cir., 201 F.2d 874.
13
In the Lehman case the existence of consideration was uncontroverted. There, two brothers owned equal shares in stocks and bonds. Harold agreed to transfer his share in trust for Allen and his issue, in consideration of Allen transferring his share in trust for Harold and his issue. The trust instruments were duly executed and each brother thereby granted to the other, in the trust created, the income for the other's life, with remainder to the latter's issue, together with a right in the other to withdraw $150,000 from the principal.
14
In the Newberry case, where the court, based upon oral testimony, held there was no consideration, Mr. and Mrs. Newberry each executed a trust conveying his or her own property for the benefit of their children. However, neither settlor created any beneficial interest therein for his or her spouse.
15
In the case at bar there is no parole evidence in the record. We have merely the instruments creating the trusts and amending them. At the time and place when and where Albert executed a trust creating inter alia a life estate for the benefit of his wife Minnie, she executed precisely the same form of trust covering precisely the same amount and kind of property, thereby creating inter alia a similar life estate for the benefit of Albert. The two trusts together also provided for their children and their families. Here is a beneficial interest contemporaneously bestowed upon the maker of each trust, by the maker of the other trust. The significance of this circumstance has been overlooked by the majority opinion. It is an undue taxing of our credulity to ask us to believe that this transaction lacked consideration. The only logical inference to be drawn from the stipulated facts is that, when Albert gave to Minnie a life estate in a trust which he then created, and she contemporaneously did the same for him, the act of one was the consideration for the act of the other. In an exchange the property received is consideration for the property given. Cole's Estate v. Commissioner of Internal Revenue, 8 Cir., 140 F.2d 636, at page 637. Both reason and the law place upon him who would rebut this reasonable inference the burden of introducing evidence to that end. The competent attorneys who devised the plan now reviewed before us and their assistants or office associates were certainly in a position to introduce evidence on this subject, the nature of which is exemplified in the Newberry case. However, it is well to point out that even such testimony, to be effective, must counterbalance the fact of the execution of the trust agreements and their contents. In the case at bar, such evidence would have to explain why each of the trusts set up a life estate in the spouse of the maker of the trust. Orvis v. Higgins, 2 Cir., 180 F.2d 537, at page 540.
16
In the instant case Albert, in consideration of granting to Minnie, in the Dorothy trust which he set up, the possession and enjoyment of and right to the income from his trust estate, during her lifetime, procured from her a similar life estate in the Harold trust, which she set up. Under § 811(c)(1)(B) the Harold trust created by Minnie must be treated as though created by decedent, and thereby § 811(c)(1)(B) operates to bring the corpus of that trust into Albert's gross estate.1
17
We also find that in this case the Harold trust, as modified by an instrument executed by Albert, Harold, and Dorothy under date of December 18, 1935, was subject to termination by Albert and Dorothy, so long as Harold or any of his lawful issue were living. It was held in Commissioner of Internal Revenue v. Estate of Holmes, 326 U.S. 480, at page 487, 66 S. Ct. 257, 260, 90 L. Ed. 228, that a trust settlor's power to terminate will bring a trust corpus within the scope of § 811(d)(2). That case makes clear that where, as here, enjoyment may be substantially affected by exercise of the power, a trust settlor, who may terminate a trust by joint action with another member of the family, has kept 'so strong a hold over the actual and immediate enjoyment' of the corpus as to bring it into his gross estate.
18
Accordingly, I would reverse the district court.
1
To the same effect is Hanauer's Estate v. Commissioner of Internal Revenue, 2 Cir., 149 F.2d 857, at page 859, which cites 302(d) of the Internal Revenue act of 1926, as amended in 1934 | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/728230/ | 98 F.3d 1335
NOTICE: Fourth Circuit Local Rule 36(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.UNITED STATES of America, Plaintiff-Appellee,v.Jermaine AMERSON, Defendant-Appellant.
No. 96-4065.
United States Court of Appeals, Fourth Circuit.
Submitted Sept. 20, 1996.Decided Oct. 7, 1996.
Hunt L. Charach, Federal Public Defender, C. Cooper Fulton, Assistant Federal Public Defender, Charleston, West Virginia, for Appellant.
Rebecca A. Betts, United States Attorney, Miller A. Bushong III, Charleston, West Virginia, for Appellee.
S.D.W.Va.
AFFIRMED.
Before NIEMEYER, HAMILTON, and MOTZ, Circuit Judges.
OPINION
PER CURIAM:
1
Jermaine Amerson appeals from an order of the district court revoking his supervised release and sentencing him to the statutory maximum of two years. Amerson concedes a number of violations of the conditions of supervised release, including possession of crack cocaine, but contends that the district court clearly erred in finding that he possessed crack with intent to distribute. He also argues that revocation of his supervised release and imposition of the maximum sentence was an unreasonable response to the less serious violations he admitted committing. Finding no error, we affirm.
2
Amerson was previously convicted of possession of crack with intent to distribute. In the four months following his release from prison at the end of August 1995, Amerson failed to participate in required random drug tests on six occasions and tested positive for cocaine use on three occasions. On December 17, 1995, Amerson was arrested with about three grams of crack and six grams of marijuana. He had $1318 in cash in his pocket. The passenger in his car had $500 in cash. Amerson was charged in state court with possession of crack and marijuana with intent to distribute.
3
At the revocation hearing, Amerson asked that the court continue him on supervised release, allow him to participate in a 28-day inpatient drug treatment program, and thereafter place him on home confinement with electronic monitoring.1 The government did not oppose his request. Amerson did not testify, but proffered that the drugs he possessed when he was arrested were for his personal use only. A police detective testified that the amount of drugs found on Amerson was consistent with personal use and that, consequently, the money initially confiscated from Amerson had been returned to him. However, the district court questioned the detective's conclusion that the crack was for Amerson's personal use, particularly when both Amerson and his companion were carrying large amounts of cash. The court found it equally likely that Amerson had sold some crack just before his arrest and had a small amount left.
4
Amerson then proffered that the money he was carrying was for payment of taxes on his wife's rental property. The court examined the documents he submitted in support of this explanation, but ultimately found it not credible because the taxes were not due for some months.2
5
We first find that, in view of the circumstances of Amerson's arrest, the district court did not clearly err in finding as a fact that Amerson possessed crack with the intent of selling it. Amerson's second argument also fails. Revocation of Amerson's supervised release was mandatory given that he illegally possessed a controlled substance, see 18 U.S.C.A. § 3583(g)(1) (West Supp.1996), and the court merely exercised its discretion in sentencing him above the range set out in USSG § 7B1.4, p.s.3 See United States v. Davis, 53 F.3d 638, 642 (4th Cir.1995).
6
The district court's order is therefore affirmed. 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.
7
AFFIRMED.
1
Amerson waived any argument that this would constitute revocation of his supervised release
2
After the money was returned, Amerson's wife used it for car repairs
3
United States Sentencing Commission, Guidelines Manual (Nov.1995) | 01-03-2023 | 04-17-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/1199548/ | 43 Cal.2d 550 (1954)
MINNIE C. GEORGISON, Respondent,
v.
GEORGE GEORGISON, Defendant; HELEN GEORGISON, as Executrix, etc., Appellant.
S. F. No. 18847.
Supreme Court of California. In Bank.
Oct. 26, 1954.
Crist, Stafford & Peters and John M. Brenner for Appellant.
Forrest E. Macomber and Gordon J. Aulik for Respondent.
GIBSON, C.J.
On January 26, 1924, plaintiff obtained an interlocutory decree of divorce from George Georgison which ordered him to pay her $6.00 a week for her support and $6.00 a week for the support of their minor son, and these provisions were incorporated in the final judgment which was entered on February 2, 1925. Georgison died in May 1952, and in November plaintiff moved for leave to file a claim against his estate for unpaid alimony which accrued prior to plaintiff's remarriage in February 1925, and for the unpaid balance of support payments which became due before the son reached his majority in March 1944. After a hearing the motion was granted, and Georgison's executrix, his second wife, has appealed.
During February 1924 plaintiff caused Georgison to be confined in the San Joaquin County Jail for failure to pay support. Shortly thereafter Georgison left for Europe, where he remained for approximately one year before returning to the United States. Plaintiff made numerous attempts to locate him but was unable to do so until 1939, at which time he told her that he could only afford to give her $15 a month. Georgison paid plaintiff at that rate until 1941 when he discontinued making any payments.
Georgison and his second wife were living in San Francisco in 1940, and plaintiff heard that they had four houses there. She asked her attorney to make an investigation, and he reported that he could not locate any property in Georgison's name. Plaintiff telephoned Georgison at least two or three times a year from 1941 until he became seriously ill in December 1950, asking him to pay her something on account of his obligation, and he always told her that he was unable to work and that he "had nothing." In 1948 Georgison moved to Sunnyvale and lived there on property owned jointly by himself and his second wife but which appeared of record in the name of Mihaljevic. There was evidence that Georgison used several aliases, including Mihaljevic, Engleson and Wilson, and it may be inferred that he did so for the purpose of concealing property from plaintiff.
Section 685 of the Code of Civil Procedure [fn. *] provides in *552 effect that a judgment creditor may be granted leave to enforce his judgment after the lapse of five years from its entry upon proof of the reasons for his failure to do so within the five year period. [1] Under this section the creditor may be permitted to present a claim against a deceased debtor's estate upon a showing that he exercised due diligence in attempting to locate property owned by the debtor. (Lohman v. Lohman, 29 Cal.2d 144, 148-149 [173 P.2d 657].) [2] Whether or not a creditor has exercised such diligence is for the trial court to determine, and its decision will not be disturbed on appeal in the absence of a clear abuse of discretion. (Di Corpo v. Di Corpo, 33 Cal.2d 195, 200 [200 P.2d 529]; John P. Mills Organization, Inc. v. Shawmut Corp., 29 Cal.2d 863, 865 [179 P.2d 570].) [3] There is no claim that there was lack of diligence prior to 1939 when plaintiff was finally successful in locating Georgison, and the trial court could conclude that in view of all the circumstances plaintiff used reasonable diligence after that date as well as before. We find no abuse of discretion.
The order is affirmed.
Shenk, J., Edmonds, J., Carter, J., Traynor, J., Schauer, J., and Spence, J., concurred.
NOTES
[fn. *] *. Section 685 of the Code of Civil Procedure provides, in part: "In all cases the judgment may be enforced or carried into execution after the lapse of five years from the date of its entry, by leave of the court, upon motion, and after due notice to the judgment debtor accompanied by an affidavit or affidavits setting forth the reasons for failure to proceed in compliance with the provisions of section 681 of this code. The failure to set forth such reasons as shall, in the discretion of the court, be sufficient, shall be ground for the denial of the motion." Section 681 provides for issuance of execution as a matter of right within five years from the time of entry. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1547959/ | 9 B.R. 730 (1981)
In re Robert Glenn SKIPWITH and Roberta Rae Skipwith, fdba Nature Land Farms, Debtors.
Bankruptcy No. 80-01274-M.
United States Bankruptcy Court, S.D. California.
March 3, 1981.
*731 Louis M. Karp, James McCafferty, San Diego, Cal., for debtors.
Philip J. Giacinti, Jr., San Diego, Cal., Trustee.
MEMORANDUM DECISION REGARDING TRUSTEE'S OBJECTIONS TO EXEMPTION CLAIMS
JAMES W. MEYERS, Bankruptcy Judge.
I
This dispute brings into focus several issues concerning the availability of state and federal exemptions to joint debtors who have sought relief under the United States Bankruptcy Code ("Code"). The debtors, Mr. & Mrs. Robert Skipwith, filed their Chapter 7 petition on May 19, 1980. The trustee, Mr. Philip J. Giacinti, Jr., filed his objections to certain claims of exemption contained in their petition. A hearing was then held before this Court on the issues presented. Having now had an opportunity to reflect upon these questions, this Court finds that the objections should be sustained in part. This opinion will set forth the reasoning behind that decision.
II
FACTS
The debtors currently own improved real property situated in this district with an estimated fair market value of $75,000. This property was acquired by the debtors during their marriage and is therefore community property. See Cal.Civ.Code § 5110 (West). The property is encumbered with liens totaling $32,661, leaving an equity for the debtors of over $42,000. On March 11, 1980, the debtors sought to perfect a homestead in this property, and to that end, Mrs. Skipwith executed and had recorded, a declaration declaring the premises to be a homestead and stating that the declaration was filed for the joint benefit of herself and her husband.
Among their other assets was a promissory note payable to the debtors which was secured by a deed of trust. This asset is also community property. See Cal.Civ.Code § 5110 (West). The note was executed by Mr. & Mrs. Daniel Cayan pursuant to an agreement with the debtors whereby the Cayan's purchased a parcel of "farmland" from the debtors. The amount owing on the note is $12,875.
Both of these assets were claimed exempt by the debtors. Mr. Skipwith sought to utilize the federal exemptions contained in Section 522(d) of the Code to shield the note.[1]See 11 U.S.C. § 522(d). Mrs. Skipwith elected to claim a state homestead in their residence. See Cal.Civ.Code §§ 1237 et seq. (West).[2]
III
DISCUSSION
A. CLAIM OF EXEMPTION OF PROMISSORY NOTE
The trustee's objection to the debtors' exemption of the promissory note is premised on the law of community property *732 in California. The trustee argues that one joint debtor, here Mr. Skipwith, can exempt only his "aggregate interest" in a community asset. In this case the trustee suggests that this amount is $3,950, or one half of the $7,900 exemption afforded by Section 522(d)(5). This claim is based on the view that since a spouse's interest in community property is "present, existing and equal ....", see Cal.Civ.Code § 5105 (West), one joint debtor is entitled to exempt only one half of a community asset. Here then, Mr. Skipwith's "aggregate interest" in the note is said to be only $3,950, and the estate is thus entitled to the remaining $3,950.
The debtors, naturally, take issue with this reasoning. They point out that community property interests are not "divisible in a bankruptcy context ...." They further argue that each spouse has an undivided interest in all of the community property and that the exemption given by Section 522(d)(5) applies to "any property". By this, the debtors are taken to mean that the exemption in Section 522(d)(5) applies to all property claimed exempt by a joint debtor regardless of its status.
The extent of a joint debtor's federal exemption rights in community property was recently defined by this Court in In re Smith, 8 B.R. 375 (S.Cal.1980). In Smith, this Court determined that if only one joint debtor claims a federal exemption under Section 522(d) in a piece of property, then it will only be recognized to the extent of the debtor's aggregate interest in the property. In California community property that interest cannot exceed 50% of the value of the property in question.
Here the note is valued at $12,875, with Mr. Skipwith's interest being one half, or $6,437.50. Therefore, Mr. Skipwith's claim of exemption in the property will be recognized only in the amount of his individual interest.
B. CLAIM OF HOMESTEAD EXEMPTION ON RESIDENCE
1. Right to State Homestead Exemption
In this case Mrs. Skipwith has claimed a homestead exemption in the amount of $40,000 in the debtors' residence, in which they had an equity of $42,339. Mrs. Skipwith made this claim relying on California statutes providing for homestead protection. See Cal.Civ.Code §§ 1237 et seq.; 11 U.S.C. § 522(b)(1). Mr. Skipwith has not made any claims under California law, but has instead chosen the new federal exemptions provided in the Code. See 11 U.S.C. § 522(d).
Shortly after this matter was taken under submission, Judge Herbert Katz, of this district, issued his opinion in In re Scott, ___ B.C.D. ___ (S.Cal., No. 80-00732-K, Oct. 24, 1980). In that decision, Judge Katz held that California law requires the union of both spouses in claiming the benefits of the state homestead exemption. Scott would preclude one joint debtor from taking advantage of the new federal exemptions while the other spouse was claiming the full "head of household" California homestead exemption. Slip op. at 8. See also In re Dill, 6 B.R. 396 (Bkrtcy.N.Cal. 1980). The Scott decision appears to reach a conclusion in direct conflict with that reached by two of our colleagues located in other California districts. See In re Ancira, 5 B.R. 673, 6 B.C.D. 864 (Bkrtcy.N.Cal. 1980); In re Collins, 5 B.R. 675, 6 B.C.D. 834 (Brktcy.N.Cal.1980); Matter of Brosius, 7 B.R. 811 (Brktcy.C.Cal., 1980). These courts focus on Section 522(m) of the Code which allows each joint debtor the freedom to choose between the state and federal exemptions. Both courts then go on to find that in California, one joint debtor can claim the full benefits, as the head of household, of the state homestead statutes, while the other spouse claims the federal exemptions.
The questions discussed in these decisions are inherently raised by the trustee in his challenges to the debtors' claims of exemption, although initially they were not specifically addressed by the parties. In considering the conflicting authorities, which includes one decision by a fellow member of this district's bankruptcy bench, it is necessary *733 for this Court to reach its own independent determination on the issues presented. See e.g., White v. Baltic Conveyor Company, 209 F.Supp. 716, 722 (N.J. 1962). With this end in mind, the parties were asked to further brief the Court and these briefs have now been received.
In examining the debtors' claims of exemption it should be noted that their claims enjoy a presumption of validity with the burden of challenging them being on the trustee. See In re Crump, 2 B.R. 222, 5 B.C.D. 1235 (Bkrtcy.S.Fla.1980). Also, California law favors homesteads for they are constitutionally authorized, statutorily enacted and liberally protected. See Lee v. Brown, 18 Cal.3d 110, 113, 132 Cal.Rptr. 649, 553 P.2d 1121 (1976); In re Howell, 638 F.2d 81 (9th Cir. 1980). The broad purpose of the homestead law is to promote the security of the home by placing such property beyond the reach of the consequences of the home owner's economic misfortune. See Adams, Homestead Legislation in California, 9 Pac.L.J. 723 (1978). This liberal treatment accorded homestead claims by the California courts must be respected by this Court. See Towers v. Curry, 247 F.2d 738, 740 (9th Cir. 1957).
Under Section 522 of the Code an individual debtor may choose the federal exemptions stated in Section 522(d), or may choose any exemptions to which entitled under other applicable law, either state or federal. In a joint case this freedom of choice is clearly awarded to each debtor under Section 522(m). However, in making this choice a debtor can only receive the benefits of a state created exemption provision if the debtor is eligible therefor and has properly perfected the claim according to state law. This is because there is nothing in the Code which suggests that when a debtor chooses to utilize state exemptions, that the debtor is free from the restrictions established by state law. See In re Lowe, 7 B.R. 248, 250 (Bkrtcy.E.Wash.1980). Thus, a joint debtor may select the state exemptions, but must abide by the state rules regulating the grant of such protection. See In re Ageton, 5 B.R. 323, 325, 6 B.C.D. 706, 707 (Bkrtcy.Ariz.1980).
California law, as summarized in Matter of Brosius, reflects that:
[c]ase law holds that the California homestead exemption extends to the entire interest of both spouses in the property. Strangman v. Duke, 140 Cal.App.2d 185, 295 P.2d 12 (1956); Schoenfeld v. Norberg, 11 Cal.App.3d 755, 90 Cal.Rptr. 47 (1970). However, under the California Homestead Act (C.C. § 1237 et seq.), although it is not necessary for both spouses to join in executing and claiming the homestead exemption, it is always filed for the joint benefit of both spouses. C.C. § 1262, 1263. Under California law, there appears to be no provision for a married person to file a homestead for his or her own benefit absent legal separation. C.C. § 1300.
Matter of Brosius, supra, 7 B.R. at 812-13 (emphasis added). See also Harley v. Whitmore, 242 Cal.App.2d 461, 466-67, 51 Cal. Rptr. 468 (1966).
Now the Court in Brosius points to the fact that under California law married couples do not have to physically join in the homestead declaration and either spouse can declare the homestead. See Cal.Civ. Code § 1262 (West). However, focusing on the mechanics established to declare a homestead overlooks the essential of California law that the declaration is for the joint benefit of both spouses. The state has found the protection of the family residence to be of such importance that it allows either spouse to file the necessary declaration, even absent the consent of the other spouse. But once a homestead is filed it provides protection of both spouses' interests in the property. This being the effect of California law, then this Court finds itself in accord with the conclusion announced in Scott, that once the homestead is declared then both spouses become part thereof for it requires the union of both for a valid "head of a family" homestead to be perfected by a married couple. See In re Scott, supra, slip op. at 8.
*734 In recognizing these state constrictions regulating homestead exemption claims we do not interfere with the election provided for in Section 522(m). Joint debtors still have the freedom to elect exemptions at their sole discretion. Obviously in states such as California, homeowners may feel compelled to jointly claim the state homestead given the economic realities created by this most liberal homestead provision. However, in other instances, joint debtors may find benefit in splitting their claims between state exemptions, not requiring a joint claim, and federal exemptions. Further, it must be remembered that Congress ceded to the states the power to bar entirely the selection of the federal exemptions listed in Section 522(d). See 11 U.S.C. § 522(d). This California restriction on the homestead exemption must be considered as but a partial exercise of this power.
Given that the debtors did not have the benefit of the decision, announced in Scott and restated here, then in the interest of justice, the debtors should not be bound by their previous claims. See Matter of Mertsching, 4 B.R. 519, 6 B.C.D. 445 (Bkrtcy.Idaho 1980). Instead they will be allowed 20 days within which to amend Schedule B-4. As it appears likely that the debtors will find advantage in jointly selecting the California "head of a family" homestead exemption, then this Court will consider the amount allowable to these debtors under this exemption.
2. Amount of Allowable Homestead Exemption
The trustee's objection relies on the fact that the value of the debtors' equity in their homestead exceeds the amount of the allowable homestead exemption. Also, the debtors incurred certain debts when the "head of a household" homestead exemption was set at $30,000.[3]
The trustee claims that these pre-existing debts preclude the debtors from taking advantage of the 1979 increase in the homestead exemption. He argues that to allow the higher amount would unconstitutionally impair those pre-existing creditors' contractual rights against the debtors. See e.g., England v. Sanderson, 236 F.2d 641 (9th Cir. 1956). The trustee then goes on to question his own ability to make the impairment argument on behalf of unsecured creditors under the provisions of the Code. He ultimately suggests, though, that Section 544 allows him to "avoid" the homestead claim.
The debtors' response to all this is quite brief. They merely suggest that rights accruing under Section 544(a) are determined as of the filing date of the petition. Here, at the filing of the petition the allowable homestead was $40,000. This, they claim, is the amount against which any of the trustee's rights under Section 544 are measured.
The California courts have long held that a statute which increases a debtor's exemption is unconstitutional if it is applied to the claim of a creditor in existence prior to the law, even though the creditor had acquired no specific lien at the time of the increase. See In re Rauer's Collection Co., 87 Cal.App.2d 248, 253, 196 P.2d 803 (1948); Robertson v. Willis, 77 Cal.App.3d 358, 366, 143 Cal.Rptr. 523 (1978). The rationale of these decisions is that to give such amendments retroactive application would violate state and federal constitutional provisions forbidding state impairment of the obligations of contracts. See Note, Contracts Clause Prevents Exemption Change, 1 Stan.L.Rev. 350 (1949). See also Daylin Medical & Surgical Supply, Inc. v. Thomas, 69 Cal.App.3d Supp. 37, 138 Cal.Rptr. 878 (1977); W.B. Worthen Co. v. Thomas, 292 U.S. 426, 431-32, 54 S.Ct. 816, 817-818, 78 L.Ed. 1344 (1934). Under California law, then, to determine the applicable homestead exemption, the Court must look to the amount of the exemption in force when the debt was incurred.
*735 a. Treatment Under the Bankruptcy Act
Under the Bankruptcy Act ("Act"), which covered cases filed prior to October 1, 1979, a bankrupt was entitled to all exemptions prescribed by federal or state laws "in force at the time of the filing of the petition ...." Section 6 of the Act. The Ninth Circuit Court of Appeals interpreted Section 6 by applying California law, as stated in In re Rauer's Collection Co., when determining the proper amount of California homestead exemptions. This was first announced in England v. Sanderson, which held that when there existed creditors whose claims arose prior to an increase in Section 1260 of the California Civil Code, the bankrupt was only entitled to the exemption in effect at the time he became indebted to the earliest creditor and the excess equity in the homestead all came under the trustee's administration. The pre-existing creditors were not required to apply to state courts in order to perfect their interests as the trustee assumed the rights of a pre-existing creditor under Section 70(c) of the Act. England v. Sanderson, supra, 236 F.2d at 643. Accord, Towers v. Curry, supra, 247 F.2d at 740; Miguel v. Walsh, 447 F.2d 724 (9th Cir. 1971); In re Bassin, 637 F.2d 668 (9th Cir. No. 1980); In re Oliver, 4 B.C.D. 49, 50 (S.Cal.1978). Thus, according to England v. Sanderson the bankrupt only received the benefit of the exemption amount in force on the date of the incurrence of the oldest of the unpaid obligations.
The holding of England v. Sanderson has been the subject of much criticism. See Swenor v. Robertson, 452 F.Supp. 673, 677 (N.Cal.1978); Matter of Echavarren, 2 B.R. 215, 218, 5 B.C.D. 1229, 1230-31 (Bkrtcy. Idaho 1980); Treister, The Effect in Bankruptcy of the Increased Homestead Exemption, 39 Cal.S.B.J. 143 (1964) ("Treister"). See also Sturgeon v. Steele, 563 F.2d 1154 (4th Cir. 1977). Judge Hilgendorf in his critique, classified the Ninth Circuit's approach as the "minority rule". See Matter of Zahn, 2 B.C.D. 1609, 1613 (E.Wis.1977).[4] The gist of this criticism was that England v. Sanderson had incorrectly relied on Section 70(c), the so-called "strong-arm" clause of the Act, to give the trustee the status of a pre-existing creditor. It was claimed that this was in error, with the Supreme Court making it clear, in Lewis v. Manufacturers Nat. Bank, 364 U.S. 603, 81 S.Ct. 347, 5 L.Ed.2d 323 (1961), that the Section 70(c) creditor was one who both extended credit and obtained a judicial lien as of the date of bankruptcy and not at an anterior point in time. See Swenor v. Robertson, supra, 452 F.Supp. at 676. Under this argument the trustee could not assert the rights of a pre-existing creditor.
To begin our analysis we start with Section 70(c), as amended in 1966, which stated in pertinent part that:
The trustee shall have as of the date of bankruptcy the rights and powers of: (1) a creditor who obtained a judgment against the bankrupt upon the date of bankruptcy, whether or not such a creditor exists, (2) a creditor who upon the date of bankruptcy obtained an execution returned unsatisfied against the bankrupt, whether or not such a creditor exists, and (3) a creditor who upon the date of bankruptcy obtained a lien by legal or equitable proceedings upon all property, whether or not coming into possession or control of the court, upon which a creditor of the bankrupt upon a simple contract could have obtained such a lien, whether or not such a creditor exists.[5]
Bankruptcy Act § 70(c).
In 1954, then Circuit Judge Harlan declared that under Section 70(c) the trustee could enforce the rights of hypothetical *736 creditor who had extended credit to the bankrupt at an imaginary date prior to bankruptcy. See Constance v. Harvey, 215 F.2d 571, 575 (2d Cir. 1954). Two years later the Ninth Circuit released the England v. Sanderson case citing Constance v. Harvey in passing, but did not appear to rely on that Second Circuit case in any significant way. 236 F.2d at 643 n. 7. In 1961, the United States Supreme Court renounced the essential holding of Constance v. Harvey when it ruled that the rights of creditors, existing or hypothetical, to which the trustee succeeds under Section 70(c) are to be ascertained as of the date of filing the petition in bankruptcy and not at an earlier time. See Lewis v. Manufacturers Nat. Bank, supra, 364 U.S. at 607, 81 S.Ct. at 349. In this decision Justice Harlan joined and confessed that his opinion in Constance v. Harvey had been ill-considered. 364 U.S. at 610, 81 S.Ct. at 350. In 1962, the Ninth Circuit then had an opportunity to consider the significance of Lewis when it decided Pacific Finance Corporation v. Edwards, 304 F.2d 224 (9th Cir. 1962). In Pacific Finance the Ninth Circuit held that Section 70(c) grants to the trustee the status of a lien creditor whenever an actual creditor exists who could have become a lien creditor noting that:
the clause "whether or not such a creditor actually exists" refers only to a "creditor then holding a lien thereon." Under our construction of § 70, sub. c the trustee is empowered to exercise the powers given him even if no actual creditor has obtained a lien, but he cannot do so if no actual creditor could have obtained a lien.
304 F.2d at 228. This decision has also had its share of criticism. See 4B Collier, supra, ¶ 70.46 at 559 n. 7. Finally, in 1980, the Ninth Circuit considered the impact of Lewis in a situation much the same as that presented in England v. Sanderson and reaffirmed that questioned authority. In Bassin the Court determined that neither England v. Sanderson, nor Pacific Finance, were at odds with the Lewis case. In re Bassin, supra, 637 F.2d at 670-72.
In effect, the Ninth Circuit has construed Lewis to be concerned with when the trustee's special rights and powers as a lien creditor arise, but not to be controlling on whether the trustee succeeds to the rights and powers of actual creditors regardless of from when these rights and powers date. While this approach may be the "minority rule", it certainly is a valid analysis given the peculiar language used in Section 70(c).
b. Treatment Under the Code
Here the debtors would be claiming their homestead under state law pursuant to Section 522(b)(2)(A) which allows the exemption of property exempt under state or local law "applicable on the date of the filing of the petition". 11 U.S.C. § 522(b)(2)(A). This provision tracks the language of the provisions contained in the Act. See S.Rep.No. 95-989, 95th Cong., 2d Sess. 75 (1978), U.S.Code Cong. & Admin.News 1978, p. 5787.
To determine the relevant powers ceded to the trustee under the Code we must first read Section 544 which states that:
(a) The trustee shall have, as of the commencement of the case, and without regard to any knowledge of the trustee or of any creditor, the rights and powers of, or may avoid any transfer of property of the debtor or any obligation incurred by the debtor that is voidable by
(1) a creditor that extends credit to the debtor at the time of the commencement of the case, and that obtains, at such time and with respect to such credit, a judicial lien on all property on which a creditor on a simple contract could have obtained a judicial lien, whether or not such a creditor exists;
(2) a creditor that extends credit to the debtor at the time of the commencement of the case, and obtains, at such time and with respect to such credit, an execution against the debtor that is returned unsatisfied at such time, whether or not such a creditor exists; and
(3) a bona fide purchaser of real property from the debtor, against *737 whom applicable law permits such transfer to be perfected, that obtains the status of a bona fide purchaser at the time of the commencement of the case, whether or not such a purchaser exists.
(b) The trustee may avoid any transfer of an interest of the debtor in property or any obligation incurred by the debtor that is voidable under applicable law by a creditor holding an unsecured claim that is allowable under section 502 of this title or that is not allowable only under section 502(e) of this title.
11 U.S.C. § 544. Section 544(a) is derived from Section 70(c) of the Act and gives the trustee the rights and powers of a judicial lien creditor, a creditor holding an execution returned unsatisfied and a bona fide purchaser of real property from the debtor. See In re Martin, 6 B.R. 827, 831 (Bkrtcy.C. Cal.1980). This section, in part, is the new codification of the "strong-arm" clause with substantial changes in the language which in some instances will change the result when compared with Section 70(c) of the Act. See Levin, An Introduction to the Trustee's Avoiding Powers, 53 Am.Bankr. L.J. 173, 174 (1979). Of particular importance is the change which makes it clear that the trustee gains the rights and powers of a creditor who extends credit to the debtor "at the time of the commencement of the case". The creditor referred to in Section 544(a) is a hypothetical creditor and not the actual creditor required under Section 70(c) of the Act. But see Pacific Finance Corporation v. Edwards, supra, 304 F.2d at 224. Since Section 544(a) clearly defines the trustee's powers and rights as arising at the time of bankruptcy this provision cannot be construed to support any power to upset an increase in an exemption status occurring prior to the filing of the petition.
In contrast with subsection (a) we find that Section 544(b) does clothe the trustee with certain rights and powers held by holders of actual unsecured claims. Also, these powers vested in the trustee are not limited in time to the commencement of the case, but may relate back in time. However, under this provision the trustee may only avoid a transfer of an interest in property or an obligation incurred by the debtor. The declaration of, or an increase in, a homestead exemption is neither a transfer nor an obligation. See 11 U.S.C. § 1101(40) (definition of term "transfer"); Treister, supra, 39 Cal.S.B.J. at 146. The greatest potential use of Section 544(b) will be to enable the trustee to assert the rights of actual unsecured creditors under state fraudulent conveyance rules. See Practicing Under the Bankruptcy Reform Act, § 10.02 at 122 (1979). Section 544(b) does not make any general grant of rights and powers possessed by actual creditors upon the trustee. Since we have neither a transfer of an interest in property nor a creation of an obligation, then the trustee has no power under Section 544(b) to upset the exemption increase.
Therefore, since the trustee's powers as a hypothetical lien creditor under Section 544(a) are limited to those accruing at the start of the bankruptcy case and he takes no powers under Section 544(b) which would support a challenge to an exemption increase, then the increase of the homestead exemption to $40,000 as of January 1, 1979, must be recognized on behalf of the debtors.
In reaching this decision the Court notes that one bankruptcy court has adopted, in a Code case, the approach formulated in Swenor v. Robertson. See In re Murillo, 4 B.R. 612, 614 (C.Cal.1980). This approach must be rejected as the trustee has no power to urge an impairment of contract claim, even if limited solely to those actual claims that pre-date the exemption increase in question. This conclusion is supported by the proposal included in House bill, H.R. 8200, which would have added Section 544(c) giving the trustee additional power to enforce actions of creditors. Bkr.L.Ed., Legislative History, § 82.17 at 382 (1979). This general power to step into the shoes of individual creditors would have been limited to instances which would have produced a net benefit for the estate. However, this proposal *738 was rejected in the final enactment demonstrating that Congress had no intention of making any such general grant of power to the trustee to represent the individual interests of creditors. Compare H.R. 8200, 95th Cong., 1st Sess. § 544(c) (1977) with 11 U.S.C. § 544.
In refusing to allow the trustee to challenge the exemption increase we are in accord with the general rule that one is precluded from challenging the constitutionality of a statute by involving the rights of others. See In re Wilson, 4 B.R. 605, 607, 6 B.C.D. 443, 444 (Bkrtcy.E.Wash.1980). Now in ruling that the trustee has no standing to raise the constitutional issue of impairment of contract we are not foreclosing the possibility that individual pre-existing creditors might maintain their own cause of action based on retained rights they may have to attack the increase. If such an action is to be maintained at all it must be done by an actual creditor who extended credit to the debtors prior to January 1, 1979. In order to protect the debtors, such actions will be required to be filed in this Court within a reasonable length of time.
IV
CONCLUSIONS
1. The debtors will be allowed 20 days to file an amendment regarding their exemption claims.
2. If either debtor elects the federal exemptions provided by Section 522(d) the claim will not exempt more than 50% of the value of the assets selected if they are community property.
3. If the debtors jointly elect to claim the homestead exemption provided under Cal.Civ.Code § 1260, then the exemption will be allowed in the total amount of $40,000.
4. Creditors who extended credit to the debtors prior to January 1, 1979, will have 90 days within which to file in this Court any actions challenging the homestead exemption increase based upon the reasoning set forth in In re Rauer's Collection Co.
NOTES
[1] Section 522(d)(5) allows a debtor to exempt his "aggregate interest, not to exceed in value $400 plus any unused amount of the exemption provided under paragraph (1) of this subsection [$7,500], in any property". 11 U.S.C. § 522(d)(5).
[2] The debtor specifically claimed the $40,000 homestead provided under Section 1260.1 of the California Civil Code. See Cal.Civ.Code § 1260.1 (West).
[3] The recent history of increases in this exemption reveals that on January 1, 1977, the amount rose from $20,000 to $30,000, see 1976 Cal.Stats., effective January 1, 1979, it was increased to $40,000, see 1978 Cal.Stats., and effective January 1, 1981, it was increased to $45,000. See 1980 Cal.Stats.
[4] This opinion was the subject of a most unusual accolade when it was adopted and republished by both the district court and the Seventh Circuit Court of Appeals in affirming on appeal. See Matter of Zahn, 452 F.Supp. 1341 (E.Wis.1978), aff'd, 605 F.2d 323 (7th Cir. 1979).
[5] The 1966 amendment made changes which are immaterial to our analysis. See 4B Collier on Bankruptcy, ¶ 70.47[5] (14th ed.) ("Collier"). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588695/ | 14 So.3d 812 (2009)
Christopher THOMAS, Appellant
v.
STATE of Mississippi, Appellee.
No. 2008-KA-01081-COA.
Court of Appeals of Mississippi.
August 4, 2009.
*815 Leigh Anne Cade, Attorney for Appellant.
Office of the Attorney General by Deirdre McCrory, Jackson, Attorney for Appellee.
Before LEE, P.J., ISHEE and ROBERTS, JJ.
LEE, P.J., for the Court.
PROCEDURAL HISTORY
¶ 1. A jury in the Yazoo County Circuit Court found Christopher Thomas guilty of three counts of armed robbery. Thomas was sentenced to fifteen years on each count with each sentence to be served concurrently in the Mississippi Department of Corrections. Thomas subsequently filed a motion for a judgment notwithstanding the verdict (JNOV) or, in the alternative, a new trial. After a hearing, the trial court denied Thomas's motion.
¶ 2. Thomas now appeals, asserting the following issues: (1) the indictment was defective; (2) the trial court erred by allowing *816 the indictment to be amended on the day of trial; (3) the trial court erred by allowing the jury to observe him in restraints; (4) the trial court did not make on-the-record findings concerning the State's reasons for peremptory challenges; (5) prosecutorial misconduct denied him a fair trial; (6) the trial court erred in amending jury instruction D-5; (7) the trial court erred in overruling certain objections; (8) the trial court erred in denying his motion for a directed verdict, his motion for a JNOV, and his motion for a new trial; and (9) the cumulative errors denied him a fair trial. Finding no error, we affirm.
FACTS
¶ 3. On January 21, 2006, Thomas and his cousin were at the Game Room in Yazoo City. Several people were at the establishment playing pool and cards. Terry Collins testified that Thomas stood near his table for approximately thirty minutes. Thomas and his cousin left the Game Room. Approximately twenty minutes later, a man entered the establishment with some type of fabric around his face. The man displayed a firearm and demanded money from several patrons. Collins stated that the man entered the establishment and shot a gun in the air. Collins testified that he recognized the man as Thomas from the shoes he was wearing.
¶ 4. The man demanded money from the patrons, ultimately taking $800 from Collins, $500 from Jody Clark, and approximately $100 from Arthur Jones. Clark knew Thomas and recognized him from his voice, his clothes, and his shoes. Jones had also seen Thomas leave the Game Room and testified that he recognized Thomas when he returned by his clothing, shoes, and height. Thomas fled the scene.
¶ 5. Officer Jason Bright of the Yazoo City Police Department responded to the scene. Officer Bright spoke with several patrons, including Jones, Collins, and Clark. Officer Bright observed a bullet casing on the floor and a bullet hole in the ceiling above the pool table. Thomas ultimately turned himself in to the police department.
DISCUSSION
I. DEFECTIVE INDICTMENT
¶ 6. In his first issue on appeal, Thomas contends that the multi-count indictment was fatally defective for failing to recite the justification for a multi-count indictment. We note that Thomas failed to raise this issue at trial and is, therefore, procedurally barred from asserting this issue for the first time on appeal. Patrick v. State, 754 So.2d 1194, 1195-96 (¶ 7) (Miss.2000). However, since the issue affects the substantial rights of Thomas, we will review this issue under the plain-error doctrine. Id.
¶ 7. Mississippi Code Annotated section 99-7-2(1) (Rev.2007) governs multi-count indictments. When two or more offenses may be tried in the same court, they may also be charged in the same indictment if they are based on the same act or transaction or if they are based on separate acts or transactions connected as part of a common scheme or plan. Id. Thomas's indictment tracks the language of the armed robbery statute. See Miss. Code Ann. § 97-3-79 (Rev.2006). Inclusion of the language found in the multi-count-indictment statute was not necessary for the indictment to be valid. This Court has held that "where an indictment tracks the language of a criminal statute it is sufficient to inform the accused of the charge against him." Holifield v. State, 852 So.2d 653, 657 (¶ 9) (Miss.Ct.App.2003) (citing Ward v. State, 479 So.2d 713, 715 *817 (Miss.1985)). Thomas's indictment included the relevant language from the statute as well as the applicable statute number. Furthermore, the evidence clearly showed that these crimes were based on the same act or transaction. We do not find any defect in his indictment. This issue is without merit.
II. AMENDED INDICTMENT
¶ 8. Thomas next argues that the amendment to the indictment was a substantive change and rendered the indictment defective. Count III of the indictment read "Arthur James" and handwritten above James was "A/K/A Jones." On the day of trial, the State made an oral motion to amend Count III of the indictment to change the name of the victim from Arthur James to Arthur Jones. The prosecutor then asked permission to leave the courtroom and ask the alleged victim whether his last name was James or Jones. The victim responded that his last name was Jones. Thomas objected, arguing that the amendment was untimely and that it would violate his due process rights. The trial court asked Thomas, "Do you have any evidence that there is an Arthur James as opposed to a Jones?" Thomas responded in the negative. The trial court overruled Thomas's objection and granted the State's motion to amend the indictment.
¶ 9. Amendments to indictments are allowed if they contain defects of form and not of substance. Ivy v. State, 792 So.2d 319, 321 (¶ 4) (Miss.Ct.App.2001). We have held that "a change of the name of the victim in an indictment goes to form not substance." Id.; see also Burson v. State, 756 So.2d 830, 834 (¶ 14) (Miss.Ct. App.2000). We cannot find that Thomas's due process rights were violated by amending the indictment to correct the spelling of Jones's last name. Thomas claims unfair surprise; however, the witness was outside the courtroom waiting to testify and Thomas was aware that Jones was going to testify. Furthermore, Thomas was unable to show that his defense would be compromised by this amendment.
¶ 10. Thomas also cites to Carter v. State, 965 So.2d 705, 709 (¶ 17) (Miss.Ct. App.2007) for the proposition that the State is required to prove the identity of the victim of an armed robbery. However, the issue in Carter was that the State failed to produce two of the victims listed in the indictment and tried to amend the indictment to omit the reference to the names of these two victims. Id. We find Carter inapplicable to the present case. This issue is without merit.
III. ALLOWING THE JURY TO SEE THOMAS IN RESTRAINTS
¶ 11. In his third issue on appeal, Thomas argues that the trial court erred when it allowed the jury to see him wearing leg restraints. After the trial court granted a recess during voir dire, Thomas's leg restraints were not removed prior to the entrance of the jury. A bench hearing was conducted, and the following exchange occurred between the trial court, Joseph Hollomon (Thomas's attorney), and Steven Waldrup (attorney for the State):
THE COURT: I just told them to remove those.
MR. HOLLOMON: You did, Your Honor. I will state this, though. He was seated during the entire time the jury came back into this courtroom, and I would be surprised if any of them have seen his feet because he's been seated ever since he came in here.
THE COURT: Okay. They took [the restraints] off his hands?
MR. HOLLOMON: They did Your Honor.
*818 MR. WALDRUP: He doesn't have any on his hands. I just noticed he's got [them] on his ankles.
THE COURT: Make sure you keep him seated, and once the jury's out, I'll make sure they take them off.
¶ 12. Thomas contends that the trial court should have immediately taken a recess to remove the leg restraints and questioned the jury as to whether they had seen him in the leg restraints. From the record, it is apparent that Thomas's attorney did not think the jury had seen the leg restraints. Furthermore, Thomas failed to request a mistrial or any further action. Although it is unclear when the leg restraints were removed, Thomas has failed to show how he was prejudiced in this instance. See Williams v. State, 962 So.2d 129, 131 (¶ 8) (Miss.Ct.App.2007) (defendant has a right to be free of restraints in front of jury but must show prejudice before reversal is warranted). This issue is without merit.
IV. BATSON ISSUE
¶ 13. In his fourth issue on appeal, Thomas argues that the trial court erred in not making an on-the-record factual determination on the merits of the State's race-neutral reasons for its peremptory challenges. Batson v. Kentucky, 476 U.S. 79, 96, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986) provides the procedure for trial courts to follow when peremptory challenges are used to remove members of an identified racial group from jury service based upon nothing more than their race. To successfully assert a Batson challenge, the following must occur:
First, the defendant must establish a prima facie case of discrimination in the selection of jury members. The prosecution then has the burden of stating a racially neutral reason for the challenged strike. If the State gives a racially neutral explanation, the defendant can rebut the explanation. Finally, the trial court must make a factual finding to determine if the prosecution engaged in purposeful discrimination. If the defendant fails to rebut, the trial judge must base his decision on the reasons given by the State.
Thorson v. State, 721 So.2d 590, 593 (¶ 2) (Miss.1998) (internal citations omitted).
¶ 14. This Court gives great deference to the trial court's finding of whether or not a peremptory challenge was race neutral. Id. at 593 (¶ 4). "[W]e will not overrule a trial court on a Batson ruling unless the record indicates that the ruling was clearly erroneous or against the overwhelming weight of the evidence." Id.
¶ 15. After the State exercised its peremptory challenges, Thomas raised a Batson challenge. The trial court found a prima facie case of discrimination and asked the State to provide race-neutral reasons for striking five potential jurors (referred to according to the strike used by the State: S1 through S5). The State addressed the Batson challenge as follows:
MR. WALDRUP: The race-neutral reason for S1, Your Honor, is that Ms. Florshene Thomas stated that she was close personal friends with the whole family. I went back and asked her about her last name being Thomas. We got into a conversation about that. Because of her statement about being close friends with the family or knowing the family, that's our reason for striking her.
THE COURT: Court finds a race-neutral reason and will accept Thomas as S1. S2?
MR. WALDRUP: Dedrick Deonne Woodberry. We have two or three cases in our office right now on a Woodberry... for selling cocaine to MBN agents, and that's our basis for the challenge on Woodberry.
*819 THE COURT: Court finds a race-neutral reason for Woodberry and will accept S2. Harris?
MR. WALDRUP: Linda Harris is the one I tried to strike for cause. She knew three of the victims and she knew the defendant as well.
THE COURT: Court finds race-neutral reason for Harris and will accept her as S3. Rodney Jefferson?
MR. WALDRUP: Rodney Jefferson stated in questioning that he had seen [Thomas] around in the community, and during the process of picking the jury, I was informed by the law enforcement officers that he was good friends with the defendant.
THE COURT: Court finds a race-neutral reason for Jefferson and will accept him as S4. S5, Austin.
MR. WALDRUP: Mr. Austin, Your Honor, his wife was first cousin[s] with one of the [victims] involved. He was relatedhe was related by marriage to the defendant also and saidbut he said he could do it.... But it's because of that relationship that we chose S5.
THE COURT: Court finds a race-neutral reason for Austin and will accept him as S5.
¶ 16. Thomas contends that the trial court did not make an on-the-record determination as to the merits of the State's race-neutral reasons, and the trial court did not give him an opportunity to rebut the State's proffered reasons. In regard to whether the trial court allowed Thomas to rebut the State's reasons, we note that Thomas failed to object during the Batson hearing. Furthermore, although the trial court did not specifically ask Thomas for rebuttal, Thomas had the opportunity to offer rebuttal at any time during the hearing.
¶ 17. Thomas cites to Hatten v. State, 628 So.2d 294, 298 (Miss.1993) in support of his position that the trial court is required to make specific findings as to the merits of the race-neutral reasons given for excluding the potential jurors. Hatten requires trial courts to make "an on-the-record, factual determination, of the merits of the reasons cited by the State for its use of peremptory challenges against potential jurors." Id. at 298. However, in Gary v. State, 760 So.2d 743, 748 (¶ 12) (Miss.2000), the supreme court stated the following:
[W]here a trial judge fails to elucidate such a specific explanation for each race neutral reason given, we will not remand the case for that Batson-related purpose alone. This Court is fully capable of balancing the Batson factors in cases such as this one. Continued remand of such cases only wastes the trial court's limited resources and acts to further delay justice.
See Pruitt v. State, 986 So.2d 940, 946 (¶¶ 20-21) (Miss.2008); Johnson v. State, 875 So.2d 208, 214 (¶ 10) (Miss.2004); Berry v. State, 802 So.2d 1033, 1047 (¶¶ 47-49) (Miss.2001); Newberry v. State, 2007-KA-00875-COA, ___ So.3d ___ (¶ 7), 2008 WL 5147118 (Miss.Ct.App. Dec. 9, 2008). Since Thomas offered no rebuttal, the trial court based its decision on the reasons given by the State and found these reasons to be race-neutral. We can find no error on the part of the trial court; thus, this issue is without merit.
¶ 18. We note that the trial court had to conduct another Batson hearing based on Thomas's improper use of peremptory strikes. The trial court found that one of Thomas's race-neutral reasons was unacceptable and refused to grant that particular strike.
V. PROSECUTORIAL MISCONDUCT
*820 ¶ 19. In his fifth issue on appeal, Thomas cites to five instances of alleged prosecutorial misconduct that denied him a fair trial. We will address each perceived error separately.
A. Comment Concerning Thomas Firing a Weapon
¶ 20. During opening statements, the State was describing the police officer's attempt to get a description of the person "who did the shooting and robbing." Thomas objected to any testimony about a shooting. Once Thomas realized that the State was describing Thomas's actions when he entered the establishment and not implying that he was shooting the patrons, Thomas withdrew his objection. Upon resuming its opening statement, the State reiterated to the jury that Thomas fired a shot into the ceiling and not at the individuals inside. Since Thomas withdrew his objection, we cannot find any error with this statement.
B. Comment Concerning "Exhibiting" During Opening Statement
¶ 21. During opening statements, the State was discussing the elements of armed robbery and stated the following: "Not just robbery, armed robbery. Exhibiting a weapon. See, when you point and wave, you are exhibiting a weapon." Although Thomas failed to object to this statement, we find no error regardless. The State was merely discussing the elements of armed robbery.
C. Comment on Facts Not in Evidence
¶ 22. During closing statements, the State said the following: "If he had something over his eyes, he couldn't see so his whole face wasn't covered, folks. That's the thing. His whole face wasn't covered." Thomas objected, arguing that this statement was contrary to the evidence. The trial court overruled the objection. In general, parties may comment upon any facts introduced into evidence, and may draw whatever deductions and inferences that seem proper from the facts. Bell v. State, 725 So.2d 836, 851 (¶ 40) (Miss.1998). Although all the witnesses testified that Thomas had some type of fabric tied around his head, we cannot find that this statement concerning Thomas's eyes was prejudicial. One could easily infer that, in order to commit the crimes as charged, Thomas would not have restricted his eyesight.
D. Comments Regarding a False Statement Made by a Witness
¶ 23. Thomas argues that the State improperly attempted to impeach Rosie Thomas, Thomas's mother, during Thomas's testimony. During her testimony Rosie was asked what Thomas was wearing on the night of the armed robbery. Rosie stated that Thomas was wearing a long blue-striped shirt, blue jeans, and black shoes. On cross-examination, Rosie stated that she had gone to bed around 11:35 p.m. on the night of the armed robbery and heard about the alleged armed robbery not long after around 12:10 a.m. The State also elicited information concerning her shift hours as a dispatcher for the police department. When asked about her work schedule, Rosie stated that she believed the armed robbery had occurred on a Saturday night and that she had worked the day shift that Saturday from 6:00 a.m. until 2:00 p.m.
¶ 24. During direct examination, Thomas stated that he returned home to Rosie's house sometime after 10:30 or 11:00 p.m. and that he thought his mom was in her room. During Thomas's cross-examination, the State asked Thomas if he was aware that, on the night of the robbery, Rosie clocked in for work at 11:00 p.m. Thomas objected to the State trying to impeach him with Rosie's testimony. The *821 trial court overruled the objection. However, on appeal, Thomas asserts that the State was attempting to impeach Rosie's testimony, rather than Thomas's testimony in violation of Rule 613(b) of the Mississippi Rules of Evidence.
¶ 25. First, we note that Thomas's contention is waived. "Asserting grounds for an objection on appeal that differs from the ground given for the objection at the trial level does not properly preserve the objection for appellate review." Woodham v. State, 779 So.2d 158, 161 (¶ 12) (Miss.2001). Second, we note that Rule 613(b) refers to prior inconsistent statements by a witness. We find no evidence in the record of any prior statements made by Rosie that could be used to impeach her testimony.
¶ 26. Thomas also takes issue with a statement made by the State to the trial court regarding a rebuttal witness. However, this conversation occurred at the bench, away from the jury's ears.
E. Comment During Sentencing Hearing
¶ 27. During the sentencing hearing the State made a comment that the trial court should "take into consideration the fact that he put us through this trial... [Thomas] should have taken his plea offer." Thomas responded that it is "unconstitutional for him to be punished for exercising his right to a trial." The trial court responded, "And I agree with that. I would not consider that as part of his sentencing." The trial court clearly was not influenced by Thomas's failure to plead guilty. We can find no prejudice in the State's comments.
F. Cumulative Error
¶ 28. Thomas argues that the numerous instances of prosecutorial misconduct necessitate a reversal. As we have found no evidence of prosecutorial misconduct, this issue is without merit.
VI. JURY INSTRUCTION D-5
¶ 29. In his sixth issue on appeal, Thomas argues that the trial court erred in amending jury instruction D-5 to strike certain language. The instruction stated the following:
It is a question of fact whether the gun claimed to have been used by Christopher Thomas was a deadly weapon in the manner claimed to have been used.
A deadly weapon may be defined as any object, article or means which, when used as a weapon under the existing circumstances is reasonably capable of producing or likely to produce death or serious bodily harm to a human being upon whom the object, article or means is used.
The State objected to the language "in the manner claimed to have been used," and over an objection by Thomas, the language was removed from the instruction. It is well-settled law that an appellate court does not review jury instructions in isolation; instead, we consider them as a whole to determine if the jury was properly instructed on the law. Milano v. State, 790 So.2d 179, 184 (¶ 14) (Miss.2001). When read as a whole, if the instructions fairly announce the law of the case and create no injustice, no reversible error will be found. Phillipson v. State, 943 So.2d 670, 671 (¶ 5) (Miss.2006).
¶ 30. Thomas cites to Davis v. State, 530 So.2d 694, 700 (Miss.1988) to support his contention that using this particular language in jury instructions has been upheld. We agree with Thomas. However, we find no reversible error because the language in the second paragraph of D-5, "when used as a weapon under the existing circumstances," adequately conveys the same point as the removed language.
*822 VII. OBJECTIONS MADE BY THOMAS
¶ 31. In his seventh issue on appeal, Thomas argues that the trial court erred in overruling certain objections made during trial. The first challenge occurred during the direct examination of Collins. The State asked Collins if his story of the events that night had changed between the robbery and trial. Thomas made a general objection, which the trial court overruled. The supreme court has stated that objections must be made with specificity in order to be preserved for appeal and that "general objections will not suffice." Seeling v. State, 844 So.2d 439, 445 (¶ 17) (Miss.2003). Thomas has failed to preserve this issue on appeal.
¶ 32. The next objection occurred during the testimony of Officer Bright. The State asked Officer Bright if there was another suspect during the course of the investigation. Officer Bright responded in the negative. Thomas objected, stating the question called for speculation. Thomas argues that Officer Bright was not the chief investigator on the case and did not have firsthand knowledge of the investigation. However, Officer Bright clarified that there was not another suspect in his part of the investigation. We note that there were no other suspects because Thomas turned himself in on the night of the armed robbery. We cannot find any error by the trial court in overruling this particular objection.
¶ 33. Thomas also refers us to his earlier issue concerning the improper impeachment of Rosie's testimony through Thomas's testimony. Finding no error, we decline to review this argument again.
¶ 34. Lastly, Thomas cites to his cross-examination where the State asked him if he had ever owned a firearm. Thomas objected as to relevance, and the trial court sustained the objection. At the same time the trial court ruled on the objection, Thomas answered "thirty-eight." Thomas claims that the trial court overruled the objection, but the record clearly reflects that the trial court sustained the objection. Since Thomas did not request that the jury be told to disregard the objectionable matter, then there is no error. See Shipp v. State, 749 So.2d 300, 303-04 (¶¶ 16-17) (Miss.Ct.App.1999). This issue is without merit.
VIII. SUFFICIENCY OF THE EVIDENCE
¶ 35. In his eighth issue on appeal, Thomas argues that the trial court erred in failing to grant his motion for a directed verdict and his motion for a JNOV. Thomas argues that the evidence was legally insufficient to support the verdict. Thomas mentions that the verdict was against the overwhelming weight of the evidence, but his brief solely discusses whether the evidence was sufficient.
¶ 36. A motion for a JNOV challenges the sufficiency of the evidence. Bush v. State, 895 So.2d 836, 843 (¶ 16) (Miss.2005). "[T]he critical inquiry is whether the evidence shows `beyond a reasonable doubt that accused committed the act charged, and that he did so under such circumstances that every element of the offense existed.'" Id. (citation omitted). If, viewing the evidence in the light most favorable to the State, any rational trier of fact could have found, beyond a reasonable doubt, the essential elements of the crime existed, this Court will affirm the denial of a motion for a JNOV. Id. If we find that reasonable, fair-minded jurors could have concluded that the defendant was guilty of the accused crime, the evidence will be deemed sufficient. Id.
¶ 37. Thomas's sole contention is that the State failed to prove that he was, *823 in fact, the perpetrator. Thomas relies on the testimony from Collins, Clark, and Jones, who each stated that they did not see the face of the armed robber. However, Collins had known Thomas for ten to fifteen years and testified that he recognized Thomas from the clothes he was wearing. Clark had known Thomas for eight years and recognized him from his voice, his clothes, and his shoes. Jones had also seen Thomas leave the Game Room and testified that he recognized Thomas when he returned by his clothing, shoes, and height. Although there was conflicting testimony as to the exact color of Thomas's clothes, the jury was responsible for weighing this conflicting evidence, "evaluating the credibility of witnesses, and determining whose testimony should be believed." Ford v. State, 737 So.2d 424, 425 (¶ 8) (Miss.Ct.App.1999). From the evidence presented, we find that reasonable, fair-minded jurors could have concluded that Thomas was guilty of armed robbery. This issue is without merit.
IX. CUMULATIVE ERROR
¶ 38. In his final issue on appeal, Thomas argues that the cumulative errors of the trial court mandate reversal for a new trial. Finding each of Thomas's arguments to be without merit, we consequently do not find any cumulative error that would necessitate a reversal. This issue is without merit.
¶ 39. THE JUDGMENT OF THE YAZOO COUNTY CIRCUIT COURT OF CONVICTION OF THREE COUNTS OF ARMED ROBBERY AND SENTENCE OF FIFTEEN YEARS FOR EACH COUNT, WITH THE SENTENCES TO RUN CONCURRENTLY IN THE CUSTODY OF THE MISSISSIPPI DEPARTMENT OF CORRECTIONS, IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO YAZOO COUNTY.
KING, C.J., MYERS, P.J., IRVING, GRIFFIS, BARNES, ISHEE, ROBERTS, CARLTON AND MAXWELL, JJ., CONCUR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588696/ | 85 S.W.3d 839 (2002)
Tarrance Ray RISCHER, Appellant,
v.
The STATE of Texas, Appellee.
No. 10-01-295-CR.
Court of Appeals of Texas, Waco.
August 21, 2002.
*841 Daniel Burkeen, Groesbeck, for Appellant/Relator.
Robert W. Gage, Freestone County District Attorney, for Appellee/Respondent.
Before Chief Justice DAVIS, Justice VANCE, and Justice GRAY.
OPINION
REX D. DAVIS, Chief Justice.
A jury convicted Tarrance Ray Rischer of possession of cocaine, and the trial court sentenced him to seven (7) years' imprisonment. In two points, Rischer argues that 1) the trial court erred in admitting hearsay testimony, and 2) the evidence is insufficient to support his conviction.
BACKGROUND FACTS
Police executed a search warrant at the home of Keith McElroy and Rashan Daniels on December 14, 2000. Tarrance Rischer was inside the home when the police entered. After Rischer refused to cooperate with an officer ordering him to the floor, he was pushed to the ground. The officer testified that Rischer reached his arms out and then grabbed the corner of the couch. Cocaine was found under the couch where Rischer's hands had been. At trial, Daniels testified that McElroy told her that the drugs belonged to Rischer and therefore he should "take this charge." Rischer testified that McElroy asked him to take the blame because he had no prior record.
HEARSAY TESTIMONY
In point one, Rischer argues that the trial court erred in admitting hearsay testimony. Specifically, he argues that Daniels's testimony about statements made to her by co-defendant McElroy do not meet the requirements of the statement against interest hearsay exception.
Daniels testified that after McElroy was released from jail he told her that Rischer should take this charge because the drugs belonged to Rischer. McElroy told her he knew the drugs belonged to Rischer because he sold them to him. Rischer objected to this testimony and a hearing was conducted outside the presence of the jury. The trial court overruled his objection and admitted the testimony as a statement against interest.
Applicable Law
In order for a declaration against interest to be admissible under Rule 803(24) of the Texas Rules of Evidence, the statement must be self-inculpatory with corroborating circumstances to indicate the trustworthiness of the statements. See Dewberry v. State, 4 S.W.3d 735, 751 (Tex.Crim.App.1999); Bingham v. State, 987 S.W.2d 54, 56-57 (Tex.Crim.App.1999). An admission against a co-defendant declarant's interest can be admissible against the defendant so long as it is sufficiently against the declarant's interest to be reliable. See Dewberry, 4 S.W.3d at 751 (citing Williamson v. United States, 512 U.S. 594, 603, 114 S.Ct. 2431, 129 L.Ed.2d 476 (1994)).
The corroboration of a statement against interest must be sufficiently convincing to clearly indicate the trustworthiness of the statement. See Dewberry, 4 S.W.3d at 751. The courts have considered a number of factors in reviewing evidence of corroboration of the statement: (1) whether guilt of the declarant is inconsistent with guilt of the defendant; (2) whether the declarant was so situated that *842 he might have committed the crime; (3) the timing and spontaneity of the declaration; (4) the relationship between the declarant and the party to whom the statement is made; and (5) the existence of independent corroborative facts. Id.; see also Bingham, 987 S.W.2d at 58; Davis v. State, 872 S.W.2d 743, 749 (Tex.Crim.App. 1994).
Analysis
We first examine whether McElroy's statements to Daniels were sufficiently self-inculpatory. The record reflects that McElroy's statements inculpated both himself and Rischer in the delivery of cocaine. Because McElroy's statements implicated him in the possession and delivery of cocaine, this Court concludes that his statements were sufficiently self-inculpatory to be reliable. See Dewberry, 4 S.W.3d at 751.
We next review whether there was sufficient corroboration of McElroy's statements. First, McElroy's statement that he knew the cocaine belonged to Rischer because he sold it to him is consistent with the guilt of both men. Second, Rischer and McElroy were in the residence together, and thus, McElroy was so situated that he might have committed the crime. Third, the timing and spontaneity of the statement indicates the trustworthiness of the statement. The statement was made by McElroy as he picked up Daniels from jail. The voluntary statement, although made several days after the arrest, was not the product of coercion or questioning. Fourth, McElroy's incriminating statements were made to his live-in girlfriend, and thus, he had no reason to believe that statements made to her would be used against him.
Finally, the State offered evidence corroborating McElroy's statement. Officer Craig testified that upon entering the home McElroy ran into the kitchen. Craig testified that he pushed Rischer to the ground and he had his hands stretched out in front of him by the couch "like he was trying to shove something away from him." Officer Busby testified that cocaine was found under the couch near where Rischer's hands had been. Officer Oates testified that over $400 cash was found thrown behind the microwave where McElroy had fled. The evidence corroborates McElroy's statement to Daniels that he had sold cocaine to Rischer.
We conclude that the corroborative facts and evidence demonstrating the other factors indicate McElroy's statements were trustworthy and reliable under Rule 803(24). See Davis, 872 S.W.2d at 749. Thus, the hearsay accounts of McElroy's statements were admissible.[1] Accordingly, point one is overruled.
SUFFICIENCY OF THE EVIDENCE
In point two, Rischer argues that the evidence is insufficient to support his conviction. Rischer argues that the State must prove more than his mere presence in the vicinity of the contraband to support his conviction for possession of the cocaine discovered under the couch.
Rischer does not specify whether his challenge is to the legal sufficiency, the factual sufficiency, or both. In such an instance, we first look to the argument and *843 authorities presented in the brief to dictate whether an issue challenges the legal or factual sufficiency of the evidence or both. See Brown v. State, 35 S.W.3d 183, 187-88 (Tex.App.-Waco 2000, pet. ref'd). Otherwise, we will construe a general sufficiency challenge as a challenge to only the legal sufficiency of the evidence. Id. We also may look to the relief requested for guidance. Id. Rischer's argument and authorities do not give us clear guidance as to whether he is challenging the legal sufficiency, factual sufficiency, or both. However, because he requests relief in the form of reversal and acquittal, and uses the term "legal sufficiency" in his prayer for relief, we will construe his challenge for legal sufficiency. See Hoffman v. State, 922 S.W.2d 663, 671 & n. 6 (Tex. App.Waco 1996, pet. ref'd).
Legal Sufficiency Standard
In reviewing a legal sufficiency challenge, we view the evidence in the light most favorable to the verdict and determine whether any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. See Lane v. State, 933 S.W.2d 504, 507 (Tex. Crim.App.1996); Quintan v. State, 56 S.W.3d 633, 641 (Tex.App.-Waco 2001, no pet.).
Applicable Law
To prove drug possession, the State must show (1) a defendant exercised care, custody, control, or management over the drugs, and (2) that he knew he possessed a controlled substance. See Brown v. State, 911 S.W.2d 744, 747 (Tex.Crim. App.1995) (en banc). When a defendant is not in exclusive possession or control of the place where the drugs are found, the State must affirmatively link the defendant with the drugs. Id. at 748. Factors which have been considered affirmative links include: (1) presence when the search was executed; (2) contraband in plain view; (3) proximity to and accessibility of the contraband; (4) accused under the influence of contraband when arrested; (5) accused's possession of other contraband when arrested; (6) accused's incriminating statements when arrested; (7) attempted flight; (8) furtive gestures; (9) odor of the contraband; (10) presence of other contraband; (11) accused's right to possession of the place where contraband was found; and (12) drugs found in an enclosed place. See Gill v. State, 57 S.W.3d 540, 544-45 (Tex. App.-Waco 2001, no pet.); State v. Derrow, 981 S.W.2d 776, 779 (Tex.App.-Houston [1st Dist.] 1998, pet. ref'd). Despite this list of factors, there is no set formula necessitating a finding of an affirmative link, but rather, affirmative links are established by the totality of the circumstances. See Hyett v. State, 58 S.W.3d 826, 830-31 (Tex. App.-Houston [14th Dist.] 2001, pet. ref'd); Porter v. State, 873 S.W.2d 729, 732 (Tex.App.-Dallas 1994, pet. ref'd).
Evidence
Officer Craig testified that upon entering the home he saw Rischer standing by the end of the couch. Craig ordered him to the ground, but Rischer turned his back to Craig. Craig stated that Rischer was talking on his phone and "doing something with his hands." After Rischer continued to ignore Craig's orders, he shoved Rischer to the ground. Rischer began crawling away from Craig and "had his hands stretched out in front of him laying on the ground like he was trying to shove something away from him." Craig was present when Officer Busby discovered the cocaine under the couch just a few inches from where Rischer's hands were earlier. Craig also testified that McElroy had run into the kitchen during the execution of the warrant. He testified that he did not *844 see McElroy throw anything as he ran. Officer Oates discovered over $400 cash behind a microwave in the kitchen.
Rischer testified that he had been in the house for just a few minutes when officers entered to execute the warrant. He stated that he voluntarily laid on the ground after realizing that the police entry was not a joke. He stated that his hands were not near the end of the couch as he laid on the ground, but rather his feet were towards the end of the couch. He testified that he was unaware of the cocaine under the couch until the police found it. Rischer further testified that while in jail McElroy asked him to "take this charge" for him.
Analysis
Rischer argues the evidence is legally insufficient to support his conviction. The evidence shows that Officer Craig saw Rischer's hands inches away from the end of the couch where cocaine was found moments later. He also stated that Rischer looked like he was trying to shove something away from him as he laid on the ground. The following factors affirmatively linked Rischer to the cocaine: (1) his presence in the residence when the search was executed; (2) his proximity to and the accessibility of the contraband; (3) his furtive gestures; and (4) his arguable attempt to flee by crawling away from officer Craig. See Gill, 57 S.W.3d at 544-45; Derrow, 981 S.W.2d at 779. Viewing the evidence in the light most favorable to the verdict, the evidence is legally sufficient to support the jury's finding that Rischer possessed cocaine. Lane, 933 S.W.2d at 507; Quinton, 56 S.W.3d at 641.
Accordingly, point two is overruled.
The trial court's judgment is affirmed.
NOTES
[1] We distinguish this case from Shilling v. State, 60 S.W.3d 280 (Tex.App.-Waco 2001 pet. ref'd). In Shilling, this Court found that admission of the co-conspirator's written statement after the co-conspirator asserted his right to silence violated the Confrontation Clause. Id. at 282. Here, the record does not indicate that Rischer called McElroy to testify, nor does Rischer complain on appeal that his right to confront the witness has been violated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588727/ | 944 So.2d 378 (2006)
NEWKIRK
v.
CAPSTONE DEVELOPMENT, LLC.
No. 5D05-3540.
District Court of Appeal of Florida, Fifth District.
November 28, 2006.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588774/ | 14 So.3d 188 (2008)
Jerry Kenneth GLASS
v.
STATE of Alabama.
CR-06-2058.
Court of Criminal Appeals of Alabama.
May 30, 2008.
*189 Joe W. Morgan III, Birmingham, for appellant.
Troy King, atty. gen., and Jack W. Willis, asst. atty. gen., for appellee.
WELCH, Judge.
Jerry Kenneth Glass was convicted of four counts of reckless endangerment, a violation of § 13A-6-24, Ala.Code 1975, and one count of criminal mischief in the second degree, a violation of § 13A-7-22, Ala.Code 1975; all the counts arose out of one incident in which Glass intentionally struck a vehicle from behind with his vehicle. Glass was sentenced to 12 months in jail on each count, the sentences to be served consecutively. The trial court split the sentence, and ordered Glass to serve *190 12 months and suspended the 4 remaining years for 2 years.
The evidence adduced at trial tended to show the following. In the spring of 2007, Glass's wife left him, and Glass believed she was seeing another man. Glass's behavior became erratic. One night in the week before the incident made the basis of this prosecution, Glass telephoned a friend, Melanie Phillips, and asked her to drive him to a restaurant because he believed that his wife would be there with the man. Phillips testified that as they drove, Glass kept looking into cars and asking her to follow some, looking for his wife. In the restaurant parking lot, Phillips said, Glass would look into cars or go up to groups of people leaving the restaurant thinking his wife was with them. Phillips eventually left Glass in the parking lot at about 11:00 p.m. She then telephoned his parents and described his behavior to them.
Christy Claunch, an assistant manager at the restaurant, testified that she received a telephone call from Glass's father asking her to check on Glass. She said she found Glass in the parking lot, and that he ran toward her from some bushes. He yelled at her to stay away from a certain car, because, Glass told her, it belonged to his wife. Claunch said that actually, the car belonged to one of her employees. She said that Glass also believed that he saw his wife in several cars in the parking lot. She waited with Glass until his parents arrived. Glass then got in their car and left.
Claunch described Glass as "scruffy," and she said that he was nervous and excited. She testified that she did not smell any alcohol about him, but that, based upon his behavior, she suspected he was under the influence of drugs.
Some nights later, on the night of March 17 or in the early morning hours of March 18, 2007, a group of four teens who had attended the senior prom at Lexington High School were traveling back and forth on Highway 71 going to a friend's house for a post-prom party after having picked up a video game at another friend's house. Josh Hunt was driving the group in his father's Ford F-150 pickup truck.
Phillips and several other people, including Glass's sister, Amanda, were at Glass's house that same night. Amanda said that Glass received a telephone call from his wife and that his wife apparently taunted Glass about his Chevrolet Tahoe sport-utility vehicle. Phillips said the group at Glass's house saw a white pickup truck drive down the highway in front of the house three times, and Glass became convinced that his wife was in the truck. He left the house and drove off in the Tahoe, following the pickup truck.
Hunt testified that as he was returning to the party, he saw a truck pull up behind him flashing its headlights. Hunt said he pulled over to the side of the road, put his head out the driver's side window, and saw Glass, whom he knew, walking toward him. Glass was "screaming and hollering," and Hunt drove off. Glass got back into the Tahoe and chased Hunt's pickup truck down the highway.
Hunt said that as they traveled down the highway, Glass began bumping the back end of the truck with his Tahoe. The bumps got progressively harder. Hunt said Glass would let a short distance develop between the vehicles, then Glass would accelerate and hit the truck. Hunt estimated that the truck was hit between 5 and 10 times. Eventually Glass turned around and Hunt and his friends continued on to their friend's house.
Diane Gower, who lives near Glass, testified that on the night of the prom at Lexington High School, she was awakened about 1:00 a.m. by the sound of her door *191 slamming. She said Glass was at her door saying that he had chased a truck he thought was his wife was in so that he could run it off the road, but that his wife had not been one of the occupants. Gower said that Glass told her he had been drinking and that he did not want to be arrested for driving under the influence of alcohol but that he planned to turn himself in the next morning. Gower confirmed that Glass smelled of alcohol and that he acted as though he was drunk.
Ronnie Hunt, Josh's father, testified that he allowed Josh to drive the Ford F-150 the night of the prom. He said that he had an estimate from a body shop that repairs to the truck as a result of the incident would cost about $2,000.
I.
Glass contends that the trial court erred in denying his motion for a mental examination to determine his competence on the night of the offense. Specifically, Glass argues that he presented sufficient evidence at a hearing on his motion to call into question his competency on that night.
" "`A defendant does not have a right to a mental examination whenever he requests one, and, absent such a right, the trial court is the screening agent of such requests. Robinson v. State, 428 So.2d 167 (Ala.Crim.App. 1982); Beauregard v. State, 372 So.2d 37 (Ala.Cr.App.), cert. denied, 372 So.2d 44 (Ala.1979). The defendant bears the burden of persuading the court that a reasonable and bona fide doubt exists as to the defendant's mental competency, and this is a matter within the discretion of the trial court. Miles v. State, 408 So.2d 158 (Ala.Crim.App.1981), cert. denied, 408 So.2d 163 (Ala.1982). In determining whether an investigation into the defendant's [competency] is required, the trial court must determine if any factual data establish a reasonable ground to doubt the defendant's [competency]. Beauregard, 372 So.2d at 43. Where the trial court finds that the evidence presents no reasonable grounds to doubt the defendant's [competency], the standard of appellate review is whether the trial court abused its discretion. Id."
"`Cliff v. State, 518 So.2d 786, 790 (Ala.Crim.App.1987). See also Stewart v. State, 562 So.2d 1365 (Ala.Crim. App.1989); Russell v. State, 715 So.2d 866 (Ala.Crim.App.1997); Ala. R.Crim.P. 11.'
"Ingram v. State, 779 So.2d 1225, 1270-71 (Ala.Crim.App.1999), aff'd, 779 So.2d 1283 (Ala.2000)."
Harrison v. State, 905 So.2d 858, 861 (Ala. Crim.App.2005).
"Only when the evidence presents a sufficient doubt as to the defendant's sanity is an investigation into his sanity required. Buttram v. State, 338 So.2d 1062 (Ala.Crim.App.1976); Gales v. State, 338 So.2d 436 (Ala.Crim.App.), cert. denied, 338 So.2d 438 (Ala.1976); Buttram v. State, 57 Ala.App. 425, 329 So.2d 114, cert. denied, 295 Ala. 394, 329 So.2d 116 (1976).
"`Before the trial judge suspends the normal course of criminal proceedings and conducts a jury inquiry into the "fact of sanity" there must come to his attention factual data, tending to show "reasonable ground to doubt (the accused's) sanity." The court has discretion to determine if the underlying factual basis said to exist does in fact exist, and whether such factual basis constitutes "reasonable ground to doubt (the accused's) sanity."' Brinks v. Alabama, 465 F.2d 446, 450, (5th Cir.1972), cert. *192 denied, 409 U.S. 1130, 93 S.Ct. 940, 35 L.Ed.2d 263 (1972).
"Where the trial court finds that there are no reasonable grounds to doubt the accused's sanity, the standard of appellate review is whether the trial judge abused his discretion. Pace v. State, 284 Ala. 585, 226 So.2d 645 (1969); Wheeler v. State, 47 Ala.App. 457, 256 So.2d 197 (1971).
"In determining whether a reasonable doubt as to sanity exists, the trial judge may make investigation and hear evidence. Thomas v. State, 357 So.2d 1015, 1018 (Ala.Crim.App.1978)."
Beauregard v. State, 372 So.2d 37, 43 (Ala. Crim.App.1979).
"In Ake v. Oklahoma, the United States Supreme Court held that `when a defendant demonstrates to the trial judge that his sanity at the time of the offense is to be a significant factor at trial, the State must, at a minimum, assure the defendant access to a competent psychiatrist who will conduct an appropriate examination....' Ake v. Oklahoma, 470 U.S. 68, 83, 105 S.Ct. 1087, 84 L.Ed.2d 53 (1985)."
Burgess v. State, 962 So.2d 272, 291 (Ala. Crim.App.2005).
To show legal insanity at the time of the offense, Glass would have to demonstrate that he "suffered from a mental disease or defect preventing him from appreciating the nature and quality or wrongfulness of his acts." Morris v. State, 956 So.2d 431, 442 (Ala.Crim.App.2005); Flowers v. State, 922 So.2d 938, 956 n. 4 (Ala.Crim.App. 2005); § 13A-3-1(a), Ala.Code 1975.
In this case, the trial court held a hearing on Glass's motion seeking a mental examination to determine his competency at the time of the offense. Glass presented evidence tending to show that in the week before the incident made the basis of this prosecution, he had exhibited odd behavior. His wife had left him, and he believed she was seeing another man. As a result, he was depressed and upset. Glass believed he saw his wife in various vehicles as he rode around town. He also believed that she would be at a certain restaurant one night, so he watched the cars in the restaurant parking lot, believing his wife to be in the cars or with people who were leaving the restaurant.
Phillips said that a few days after Glass had her drive him to the restaurant, she made an appointment for him to see a physician, Dr. Wompler. She testified that Dr. Wompler prescribed Ativan, an anti-anxiety medication, for Glass, but that Glass had an adverse reaction to the drug, and a prescription for Paxil was substituted for Ativan. Dr. Wompler did not testify at the hearing, but the prosecutor offered into evidence a letter written by Dr. Wompler stating he first prescribed anti-anxiety medication on March 12, 2007. Glass agreed to the admission of the letter, and it was received into evidence.
From this evidence, the trial court could have found that Glass failed to present a factual basis that there were reasonable grounds to doubt his sanity or competency at the time of the offense. Glass's evidence indicated that he acted in an odd manner on one night about a week before he intentionally struck Hunt's truck. Evidence regarding his behavior the night of the incident, however, tends to show that he was not acting oddly, but that he became agitated when his wife telephoned to taunt him about his Tahoe. He saw a truck pass his house a number of times and believed his wife was in it, so he went after the truck to confront her.
Glass presented no medical or expert testimony that would indicate that he suffered from a mental disease or defect and that he was unable to appreciate the nature *193 and quality of the wrongfulness of his act.
Based on the evidence in the record, we find that the trial court did not abuse its discretion in finding that Glass failed to demonstrate that there were reasonable grounds to doubt his sanity at the time of the offense and that Glass's sanity at the time of the offense would not be a significant factor at trial.
II.
Glass contends that he was not allowed to present a complete defense in this case because, he says, in denying his motion for a mental examination, the trial court improperly made the ultimate decision as to whether he in fact suffered from a mental disease or defect rather than deciding whether a mental examination was proper.
As mentioned above, "`[a] defendant does not have a right to a mental examination whenever he requests one, and, absent such a right, the trial court is the screening agent of such requests. Robinson v. State, 428 So.2d 167 (Ala.Crim.App. 1982).'" Ingram v. State, 779 So.2d 1225, 1270 (Ala.Crim.App.1999) (quoting Cliff v. State, 518 So.2d 786, 790 (Ala.Crim.App. 1987)). Here, the trial court properly acted as the "screening agent" when it determined that there was insufficient evidence from which to find a reason to doubt Glass's sanity at the time of the offense. We have already determined that the trial court did not abuse its discretion in denying Glass's request for a mental examination. This issue is without merit.
III.
Glass contends that he was improperly convicted of and sentenced for multiple counts of reckless endangerment although, he says, he committed only a single offense and that those convictions and sentences therefore violate the prohibition against double jeopardy. Because the convictions violate double-jeopardy principles, Glass claims, the trial court did not have jurisdiction to sentence him for each conviction.
The Alabama Supreme Court has previously decided this issue adversely to Glass.
"In [Ex parte] McKinney, [511 So.2d 220] [ (Ala.1987) ], the Alabama Supreme Court adopted the position of the majority of states that allow for multiple convictions when more than one person is injured as the result of a single act. In so holding, the McKinney court stated:
"`Adoption of the majority view would place Alabama among those states that have recognized that punishment for a criminal act should be commensurate with the act itself and the injury caused by that criminal act. Absent statutory or constitutional obstacles to the adoption of the majority view, logic and reason persuade us to henceforth apply the principle that a single criminal act that causes injury to more than one person may constitute more than one offense and may support more than one prosecution and conviction.
"`... [W]e also hold that henceforth §§ 13A-1-8(b) and 15-3-8 will allow more than one prosecution and conviction when more than one person is injured as a result of a single criminal act.'
"McKinney, supra, at 225."
Sims v. State, 663 So.2d 975, 978 (Ala. Crim.App.1994). The Alabama Supreme Court has also explicitly recognized that the majority view adopted in McKinney also permits multiple convictions in cases in which the defendant acted with reckless intent. McKinney, 511 So.2d at 223.
Glass's argument in this case ignores the fact that he placed the well-being of four *194 people at risk when he rammed the pickup truck with his sport-utility vehicle. In other words, four people were harmed by his reckless conduct; therefore, under Ex parte McKinney, 511 So.2d 220 (Ala.1987), four convictions of reckless endangerment were warranted in this case. Furthermore, because Glass's convictions did not violate double-jeopardy principles, the trial court properly sentenced him for each of the four counts of reckless endangerment for which he was convicted.
IV.
Glass contends that the State presented insufficient evidence to sustain his conviction for criminal mischief in the second degree. Specifically, Glass contends that the State failed to prove that the amount of damages incurred in the incident reached the threshold amount for a conviction of second-degree criminal mischief.
"A person commits the offense of criminal mischief in the second degree if, with intent to damage property, and having no right to do so or any reasonable ground to believe that he or she has such a right, he or she inflicts damages to the property in an amount which exceeds five hundred dollars ($500) but does not exceed two thousand five hundred dollars ($2,500)."
§ 13A-7-22(a), Ala.Code 1975.
During the trial of this case, Ronnie Hunt, the owner of the pickup truck, testified that he was going to have to pay $2,000 to have the damage to the truck repaired. Glass objected on the grounds of hearsay after the answer was given but did not move to strike the response; thus, any error in admitting hearsay evidence of the estimate to repair the vehicle was not preserved.
On appeal, Glass argues that evidence of repair cost is not a proper method of proving the amount of damage to property under § 13A-7-20-23, Ala.Code 1975.
Glass did not present this specific argument to the trial court, and thus it was not preserved for the purpose of appeal.
A motion for a new trial will not preserve for appellate review issues that arose during trial that were not objected to at the time they arose. See Trawick v. State, 431 So.2d 574, 578-79 (Ala.Crim. App.1983) ("The grounds urged on a motion for a new trial must ordinarily be preserved at trial by timely and specific objections."). The motion for a new trial was denied on the day it was filed, apparently without a hearing.
V.
Glass was convicted and adjudged guilty of five separate Class A misdemeanors. The trial court sentenced him to 5 consecutive 12-month terms in the county jail. However, the court then treated the 5 separate sentences as one 5-year sentence and suspended all but 12 months of the sentence under the split-sentence act. The court did not impose any probationary term on Glass during the period of the suspension.
There is no authority allowing the court to aggregate separate misdemeanor sentences and treat them as one sentence in the aggregate under the split-sentence act.
If a sentence is outside the limit provided by statute then no objection has to be made to preserve this issue for review. Ex parte Brannon, 547 So.2d 68 (Ala. 1989). We are required to notice an illegal sentence and remand to the sentencing court for a proper sentence. See, e.g., Kennedy v. State, 929 So.2d 515, 523 (Ala. Crim.App.2005); and Mosley v. State, 986 So.2d 476 (Ala.Crim.App.2007).
Based on the foregoing, Glass's convictions are affirmed. However, because his *195 sentence is illegal, we remand this cause for the circuit court to resentence Glass in a manner consistent with this opinion. Due return shall be made to this Court within 35 days of the release of this opinion.
AFFIRMED AS TO CONVICTIONS; REMANDED AS TO SENTENCING.[*]
BASCHAB, P.J., and McMILLAN and WISE, JJ., concur.
SHAW, J., concurs in the result.
NOTES
[*] Note from the reporter of decisions: On August 22, 2008, on return to remand, the Court of Criminal Appeals affirmed, without opinion. On October 10, 2008, that court denied rehearing, without opinion. On February 13, 2009, the Supreme Court denied certiorari review, without opinion (1080118). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919182/ | 224 N.J. Super. 686 (1988)
541 A.2d 271
BARBARA SYKES, ADMINISTRATRIX AD PROSEQUENDUM AND GENERAL ADMINISTRATRIX FOR THE ESTATE OF WILLIAM SYKES, AND BARBARA SYKES, INDIVIDUALLY, PLAINTIFFS-APPELLANTS,
v.
PROPANE POWER CORP., PROPANE POWER AND HEAT CORP., MCKESSON ENVIROSYSTEMS COMPANY, AS SUCCESSOR OF INLAND CHEMICAL CORPORATION, NIMCO SHREDDING CO., RAYMOND M. GILLIAM, JOHN R. BERGER, B.W. FLOERSCH, ZOOK ENTERPRISES, INC., VULCAN MATERIALS COMPANY, AND MCKESSON CORPORATION, DEFENDANTS, AND SULLIVAN ENGINEERING GROUP, INC., AND LEROY E. SULLIVAN, III, DEFENDANTS-RESPONDENTS.
Superior Court of New Jersey, Appellate Division.
Argued April 12, 1988.
Decided May 6, 1988.
*688 Before Judges MICHELS, GAYNOR and ARNOLD M. STEIN.
Edward G. D'Alessandro argued the cause for appellants (D'Alessandro, Sussman, Jacovino & Mahoney, attorneys; Edward G. D'Alessandro, of counsel and on the brief).
Andrew J. Carlowicz, Jr. argued the cause for respondents (Hoagland, Longo, Oropollo & Moran, attorneys; Andrew J. Carlowicz, of counsel; Bruce Alan Magaw, on the brief).
The opinion of the court was delivered by MICHELS, P.J.A.D.
Plaintiffs Barbara Sykes, Administratrix Ad Prosequendum and Administratrix of the Estate of William Sykes and Barbara Sykes, individually, appeal from a summary judgment of the Law Division entered in favor of defendants Sullivan Engineering Group, Inc. (Sullivan Engineering) and Leroy Sullivan, III (Sullivan) and from an order denying her motion for reconsideration in this action seeking to recover damages for the wrongful death of William Sykes (Sykes). Although plaintiff was never formally married to Sykes, she also appeals from two trial court orders entered in favor of defendants McKesson Corporation and Zook Enterprises, Inc. that dismissed all claims asserted by her individually for loss of consortium and for damages under the Wrongful Death Act, N.J.S.A. 2A:31-1 et seq., as the purported "wife" of the decedent.
The facts giving rise to this appeal may be summarized briefly as follows. During 1978-1979, Sullivan worked for Environics, Inc. (Environics), where his primary responsibility was assisting industrial facilities to comply with environmental regulations. At this time, he was assigned by Environics to assist defendant Inland Chemical Corporation (Inland Chemical) in obtaining an operating permit from the New Jersey Department of Environmental Protection (DEP) for its chemical recovery plant in Newark, New Jersey. As manager of the Inland Chemical project, Sullivan was required to compile data pertaining *689 to the existing operation of the plant in order to bring it into compliance with newly-promulgated DEP regulations. This data was embodied in a comprehensive Engineering Plan prepared and sealed by Sullivan, as a licensed professional engineer, on April 16, 1979. Thereafter, Inland Chemical received a temporary operating permit from the DEP which ran from June 27, 1980 to March 31, 1981.
After the temporary DEP permit expired, defendant McKesson Envirosystems Company (McKesson), a wholly-owned subsidiary of defendant McKesson Corporation, acquired Inland Chemical on December 1, 1981. McKesson thereupon began operating the Newark chemical recovery plant without first obtaining authorization from the DEP. Following detection and intervention by the DEP, a proposed administrative consent order was drawn up which conditioned the continued operation of the plant upon proof of compliance with the applicable provisions of N.J.A.C. 7:26-7.1 et seq. through 12.1 et seq. (regulations pertaining to the New Jersey Division of Waste Management). In pertinent part, McKesson was required to submit a series of detailed drawings revealing the layout and location of the facilities involved in the chemical recovery process.
On April 12, 1982, McKesson entered into a contract with Sullivan, who had since left Environics to form Sullivan Engineering, to assist in the development of these drawings. In accordance with the proposed order, Sullivan prepared and signed Topographic Plot and Storage Tank Location Plan Drawings which were then sent by McKesson to the DEP on April 19, 1982. Additionally, the Engineering Plan of April 16, 1979, as well as an Environmental Impact Statement which Sullivan had originally developed for Inland Chemical were re-submitted by McKesson at this time. Finally, with the assistance of William Shortreed of McKesson, Sullivan took photographs of the processing systems and then prepared "process flow diagrams" depicting the schematic relationship between the components in each system. These drawings were submitted to *690 McKesson's counsel on August 11, 1982, two days after the final administrative consent order became effective.
On October 10, 1982, Sykes, a McKesson employee, sustained fatal injuries when a chemical distillation unit in the plant exploded. The causes and environmental impact of the explosion and fire which ensued were the subject of an intensive investigation by McKesson, culminating in a 27-page "Final Accident Report" dated December 23, 1982. According to this report, the "T-1" distillation unit was being used to recover dimethyl sulfoxide (DMSO) from an industrial waste product "stock" at the time the explosion occurred. The probable cause of this explosion was determined to be "excessive acidity [in the stock] leading to an uncontrollable decomposition of DMSO ..." in the unit reboiler. In large part, the accident was attributed to the operators' failure to make regular PH analyses of the stock and to take prompt corrective measures when the system began to malfunction.
Thereafter, plaintiff instituted this action sounding in negligence and strict liability in tort against McKesson, Sullivan Engineering and Sullivan, among others, to recover damages for the wrongful death of Sykes, her cohabitant of 22 years and father of their four children. Plaintiff based her theories of liability on a report prepared by her consulting engineer, Ralph Powell (Powell), who was of the opinion that the probable causes of the accident were (1) operational negligence of the employee-operators in failing to test the acidity of the chemical "feed stock"; (2) operational negligence of the employee-operators in failing to follow proper emergency procedures once the system began to malfunction; (3) design negligence in failing to equip the unit with an interlocking monitor/alarm/shutdown system, which even in the presence of employee-operator ignorance would have achieved the safe shutdown of the unit; (4) design negligence in improperly using a "single four-inch rupture disk" too small to handle the pressure within the unit, and (5) absence of a hazard evaluation study relevant to the unit's use as a DMSO recovery system. Powell was of the opinion *691 that these five categories of error were "traceable" to all of the defendants who were involved in the design of the distallation unit, employee training programs and sampling protocols, as well as the process system's instrumentation, interlock monitor/alarm/shutdown capabilities and safety relief system. Powell opined that these individuals appeared "to comprehend", among others, Sullivan and Sullivan Engineering.
Following completion of pretrial discovery, Sullivan Engineering and Sullivan moved for summary judgment. Judge Bedford in the Law Division granted the motion, holding that their work was not causally related to the explosion. In short, he found that Sullivan had been engaged solely for the purpose of preparing the drawings and documents required by the DEP and had not been hired to go through the plant as a safety engineer and advise McKesson about correcting hazards unrelated to environmental concerns. After Sullivan Engineering and Sullivan were dismissed from the suit, defendants McKesson and Zook Enterprises, Inc. filed motions to strike plaintiff's individual damages claims on the ground that although she was living with Sykes as man and wife, they were not legally married. Judge Villanueva in the Law Division granted these motions and dismissed all damage claims asserted by plaintiff individually against the remaining defendants. He held that plaintiff could not "recover (1) for loss of consortium because there was no marriage relationship; or (2) for her death claims because she falls outside any applicable classification under N.J.S.A. 2A:31-4 et seq." Sykes v. Zook Enterprises, Inc., 215 N.J. Super. 461, 463 (Law Div. 1987).
Plaintiff now appeals from the summary judgment entered in favor of Sullivan Engineering and Sullivan, the subsequent order denying her motion for reconsideration and from the orders dismissing her individual damage claims.
I.
We turn first to the summary judgment entered in favor of Sullivan and Sullivan Engineering. The law is well-settled *692 that "[o]ne who undertakes to render services in the practice of a profession or trade is required to exercise the skill and knowledge normally possessed by members of that profession in good standing in similar communities." Levine v. Wiss & Co., 97 N.J. 242, 246 (1984), citing Restatement (Second) of Torts § 299A (1965). With respect to the community of professional engineers in this State, our Legislature has provided certain thresholds of competency and accountability to the public. Under N.J.S.A. 45:8-27, a license to practice professional engineering is required "[i]n order to safeguard life, health and property, and promote the public welfare...." Thereafter, any "[p]lans, specification [sic], plats and reports" issued by the professional engineer must bear an authorized seal of licensure under N.J.S.A. 45:8-36.
Here, plaintiff contends that Sullivan breached a duty of care owed to Sykes by placing his seal upon documents reflecting an unsafe and negligently developed chemical processing system. In particular, plaintiff points to the fact that although Sullivan was hired by Inland Chemical as an environmental consultant, the "Engineering Plan" which he issued on April 16, 1979 and which was re-submitted in 1982 by McKesson included such topics as "Explosion and Disaster Plan," "Serious Injury Plan", and "Safety Standards and Policies" under the general heading of "Risk Analysis." Furthermore, although Sullivan prepared and affixed his seal to a "process flow diagram" of the "T-1" chemical distillation unit that exploded, he admitted in deposition that he had no background in chemical engineering, and did not know anything about (1) the types of chemical solvents that were processed through the T-1 unit; (2) the frequency or nature of the inspection procedures employed; (3) the sizing of the rupture discs that were used in the unit's reboiler or (4) any of the "design criteria [or] choices that were made."
In sum, it is argued that even if Sullivan were primarily qualified as an "environmental engineer", and hired by McKesson as such, the drawings which he prepared and sealed were inextricably related to the chemical recovery process which *693 caused the explosion. Therefore, she argues that since the DEP relied upon these documents in authorizing McKesson to continue operating the plant on the day the explosion occurred, a jury could have found that Sullivan's failure to detect the inherent problems in the system constituted a proximate cause of decedent's death. We disagree.
As the New Jersey Supreme Court observed in DiCosala v. Kay, 91 N.J. 159, 175 (1982):
... the key to duty depends upon the concept of foreseeability based upon ordinary human experiences. This does not require a specific forecasting of particularly identifiable victims or a precise prediction of the exact harm that may result from the conduct. Rather, we have recognized that a party may be liable to persons who fall normally and generally within a zone of risk created by the particular tortious conduct.
Thus, if Sullivan had been hired to prepare a report for the DEP concerning potential mechanical malfunctions, employee training deficiencies or safety hazards involved in the chemical recovery process used by McKesson, he would have had a duty to detect and prevent the very types of problems which occurred in this case. Had the DEP then issued a temporary operating permit based upon Sullivan's failure to foresee, for example, the potential problem involved with a four inch rupture disc, grounds for liability would exist even if Sullivan were strictly an environmental engineer by profession. Under such circumstances, the misfeasance would have placed the decedent within a foreseeable "zone of risk."
Once again, however, it is necessary to consider whether "[t]he events here transgress the judicial line beyond which liability should not be extended as a matter of fairness or policy." Jensen v. Schooley's Mountain Inn, 216 N.J. Super. 79, 82 (App.Div. 1987) certif. den. 108 N.J. 181 (1987). As explained by the New Jersey Supreme Court in Goldberg v. Housing Authority of Newark, 38 N.J. 578, 583 (1962):
The question is not simply whether a[n] ... event is foreseeable, but whether a duty exists to take measures to guard against it. Whether a duty exists is ultimately a question of fairness. The inquiry involves a weighing of the relationship of the parties, the nature of the risk, and the public interest in the proposed solution.
*694 Although all engineers have a professional obligation to see that the work they do is accurate and in conformance with accepted standards of care, the duty to foresee and prevent a particular risk of harm from materializing should be commensurate with the degree of responsibility which the engineer has agreed to undertake. An environmental engineer may in certain circumstances be called upon to evaluate the safety of a chemical processing plant. However, Sullivan was not retained to do that here. He was only retained to prepare a basic graphical layout of the existing processing systems for the DEP. Sullivan was not asked to evaluate or upgrade McKesson's "stock" testing procedures or employee training methods, nor did he have any input into the decision to run the T-1 distillation unit without a safety interlock or to use a four inch rupture disc in the reboiler. Under the circumstances, it would go against all settled principles of tort law and considerations of fairness and policy to visit liability upon Sullivan for any failure in the plant or its operating procedures simply because he affixed his seal to several generalized drawings depicting the allegedly defective components involved.
Here, it is evident from correspondence between McKesson and the DEP that the drawings prepared by Sullivan were submitted to satisfy the requirements of paragraph 11 of the final administrative consent order of the DEP. The provisions contained in this paragraph are of particular significance. With the exception of subsection (i), which requires McKesson to specify the methods to be used to monitor the storm and sanitary sewer discharge points, paragraph 11 calls only for layout locations, profile views, elevations and cross-sections of the existing facilities. Paragraph 11 of the order did not require McKesson to assess, approve or upgrade the chemical recovery process or its attendant safety features in any way. Rather, Sullivan was retained simply to prepare generalized drawings of the processing system components in order to show how the chemicals were carried, stored and discharged.
*695 Moreover, although Sullivan's original Engineering Plan may have included such topics as "Explosion and Disaster Plan", it was submitted by McKesson solely for the purpose of complying with paragraph 13 of the final administrative consent order. Like paragraph 11, paragraph 13 has nothing to do with the safety of the chemical recovery process. It simply required McKesson to provide an engineering plan for adequate diking, piping, pumps and valves at designated vehicle loading and unloading areas, and the methods and materials to be used for constructing the containment areas. Given the specific purpose for which Sullivan was hired, and the limited scope of the order which he was required to follow in preparing the documents for McKesson, the trial court properly granted summary judgment in favor of these defendants.
Accordingly, we affirm the summary judgment in favor of Sullivan Engineering and Sullivan and the order denying plaintiff's motion for reconsideration under review.
II.
We are also satisfied that Judge Villaneuva in the Law Division properly dismissed plaintiff's individual damage claims and affirm the challenged orders substantially for the reasons expressed by him in his written opinion in Sykes v. Zook Enterprises, Inc., 215 N.J. Super. 461 (Law Div. 1987). In Sykes v. Zook Enterprises, Inc., supra, the trial court dismissed plaintiff's individual claims for loss of consortium and damages under the Wrongful Death Act, N.J.S.A. 2A:31-1 et seq. This decision was grounded on the fact that plaintiff and Sykes were never formally married in a civil or religious ceremony. As found by the trial court:
Barbara Sykes and William Sykes held themselves out as married, but were never married in a formal or religious ceremony; they owned certain property in common as "husband and wife"; they resided together and lived as husband and wife; Barbara Sykes bore four children to William Sykes and they and their offspring resided together; Barbara Sykes was named as spouse and beneficiary on a policy of insurance of William Sykes; Barbara Sykes was dependent on William Sykes. Barbara Sykes and William Sykes had lived together for 24 *696 years since Barbara Sykes was 18-years-old. Barbara Sykes gave birth to William Sykes' namesake, William Lewis Sykes, Jr., and one of their three daughters was named after Barbara Sykes and Barbara Sykes' sister, Ann. All of the children in common were given the surname "Sykes," as is the usual practice in the case of children born in wedlock.
However, Barbara Sykes did not list herself as a spouse, heir or next of kin in her complaint for administration filed in the Surrogate's Court. Only the four children were listed as next of kin and plaintiff swore that there were "no other heirs or next of kin known to the plaintiff." Decedent William Sykes was also described as "single never married." Notwithstanding those sworn representations, plaintiff proceeded to allege in this action, brought pursuant to letters of administration issued to her, that she was "next of kin" and "purported wife" of William Sykes. [Id. at 464].
On appeal plaintiff contends that the trial court's ruling with regards to her individual wrongful death claim amounted to a denial of equal protection to the Sykes children. This contention is premised upon the fact that plaintiff has been totally disabled since suffering a stroke in 1976 and requires continuous medical care. She argues that if she is precluded from recovering in her own behalf under the Wrongful Death Act, N.J.S.A. 2A:31-1 et seq., the costs of her medical care will ultimately have to be borne by her four children. Although our Supreme Court has determined that children who are not born to a legitimate marriage may nevertheless recover for the wrongful death of a parent, Schmoll v. Creecy, 54 N.J. 194 (1969), and the Sykes children did in fact institute individual claims, plaintiff nevertheless contends that these claims do not afford them the same remedy which legitimate children would enjoy under the Act, since the latter would not have to bear the additional costs of their dependent parents.
The trial court's decision was based upon a similar Law Division case, Cassano v. Durham, 180 N.J. Super. 620 (Law Div. 1981). In Cassano, the court held that one who maintains a "live-in" relationship with another out of wedlock may not recover pecuniary damages for the partner's accidental death under the Wrongful Death Act because of the language contained in N.J.S.A. 2A:31-4. In pertinent part, this statute provides that "[t]he amount recovered in proceedings under this chapter shall be for the exclusive benefit of the persons entitled *697 to take any intestate personal property of the decedent ..." [Emphasis added]. At that time, N.J.S.A. 3A:2A-34 provided only for the intestate succession of a decedent's property to the "surviving spouse." In view of the Legislature's omission of a similar intestacy provision for unmarried cohabitants, and its express refusal to recognize the validity of common law marriages, N.J.S.A. 37:1-10, the Cassano court refused to extend the availability of recovery under the Wrongful Death Act beyond persons who are legally married. This would accord with the recognized definition of "spouse" as a "man or woman joined in wedlock, a married person." Lopez v. Santiago, 125 N.J. Super. 268, 270 (App.Div. 1973), quoting Webster's Third New International Dictionary (1961) at 2208 (injured passenger who bore 4 children, lived with and used name of uninsured driver was not "spouse" within meaning of N.J.S.A. 39:6-70, and thus was not barred from recovering from the Unsatisfied Claim and Judgment Fund).
Although N.J.S.A. 3A:2A-34 has since been repealed, it has been re-codified verbatim in N.J.S.A. 3B:5-3. Thus, since the right to recover under the Wrongful Death Act is derived from the statutory laws of intestacy, which apply exclusively to "surviving spouses", plaintiff's status as an unmarried cohabitant of Sykes bars her individual claim. Nonetheless, plaintiff urges that additional circumstances exist here which compel a different result than that reached in Cassano. In particular, plaintiff contends that her children are being denied equal protection under the law because the exclusion of unmarried cohabitants from the reach of N.J.S.A. 2A:31-1 et seq. "unconstitutionally relegates the illegitimate children of William Sykes to a lifetime supporting an ailing, hypertensive, totally disabled mother without an estate in circumstances in which legitimate children would not be so burdened." This argument, however, ignores the letter and intent of the Wrongful Death Act and the rights which have been accorded to illegitimate children thereunder.
*698 Initially, it is first necessary to point out that illegitimate children are entitled to recover in their own right under the Wrongful Death Act. In Schmoll v. Creecy, supra, the Supreme Court reversed an Appellate Division ruling that an illegitimate child could recover for the wrongful death of its mother but not the wrongful death of its father unless legitimized under N.J.S.A. 3A:4-7 (now repealed). This statute required the illegitimate child to be treated as a legitimate child of the mother for purposes of descent and distribution under the laws of intestacy, but only as a legitimate child of the father if the parents subsequently married and recognized the child as their own. The application of this statute to preclude illegitimate children from recovering for the wrongful death of their father was held to constitute a denial of equal protection under the Federal Constitution since:
the underlying principle must be that when children suffer tortious injury by the wrongful death of a parent, their legitimacy is irrelevant to the tortfeasor's liability, and hence it is invidious to grant a remedy to the legitimate and withhold it from the illegitimate child. [54 N.J. at 201. Relying upon Levy v. Louisiana, 391 U.S. 68, 88 S.Ct. 1509, 20 L.Ed.2d 436 (1968)].
This rationale would apply with equal effect to the counterpart of N.J.S.A. 3A:4-7 under Title 3B, N.J.S.A. 3B:5-10, which imposes similar conditions of legitimacy upon a child born out of wedlock for purposes of intestate succession from the father. As such, the status of the Sykes children does not bar the individual claims which they have asserted for the wrongful death of their father.
Furthermore, it is significant that the Act does not differentiate between legitimate and illegitimate survivors as to the type of damages available. Rather, N.J.S.A. 2A:31-5 simply provides that:
In every action brought under the provisions of this chapter the jury may give such damages as they shall deem fair and just with reference to the pecuniary injuries resulting from such death, together with the hospital, medical and funeral expenses incurred for the deceased, to the persons entitled to any intestate personal property of the decedent. [Emphasis Added].
Our Supreme Court has defined the measure of damages available under this statute as the:
*699 "deprivation of a reasonable expectation of a pecuniary advantage which would have resulted by a continuance of the life of the deceased." McStay v. Przychocki, 7 N.J. 456, 460 (1951); Carter v. West Jersey & Seashore R.R. Co., 76 N.J.L. 602, 603 (E. & A. 1908). The amount of the recovery under this standard is based upon the contributions, reducible to monetary terms, which the decedent reasonably might have been expected to make to the survivors, and is not related to their needs. [Dubil v. Labate, et al., 52 N.J. 255, 259 (1968)]; see also Curtis v. Finneran, 83 N.J. 563, 570 (1980).
Since the recovery of pecuniary damages under the Act does not depend upon the needs of the claiming survivors, plaintiff cannot successfully contend that a denial of equal protection would occur if her children were required to provide for her future medical care out of the damages they may recover. As the trial court observed "these asserted `needs' of survivors are as unavailable to legitimate children as they would be to illegitimate children." Sykes, 215 N.J. Super. at 469-470. This is also reflected in the express language of N.J.S.A. 2A:31-4, which provides that "[t]he amount recovered in proceedings under this chapter shall be for the exclusive benefit of the persons entitled to take any intestate personal property of the decedent ..." [Emphasis added]. Thus, unlike the circumstances encountered in Schmoll, both legitimate and illegitimate children are precluded from recovering damages for future financial responsibilities which they may incur for their own dependents.
Since the Wrongful Death Act cannot be said to discriminate against the children of plaintiff in terms of the type of damages they are entitled to recover, the only question remaining is whether the statutory exclusion of plaintiff as an unmarried cohabitant is constitutionally valid in itself. The Fourteenth Amendment to the Federal Constitution and Article 1, paragraph 1 of the New Jersey Constitution share a similar objective: each "seeks to project against injustice and against the unequal treatment of those who should be treated alike." Barone v. Dept. of Human Services, 107 N.J. 355, 367 (1987), quoting from Greenberg v. Kimmelman, 99 N.J. 552, 568 (1985). Stated another way:
*700 "The equal protection of the laws means that no person or class of persons shall be denied the protection of the laws enjoyed by other persons or classes of persons under similar conditions and circumstances, in their lives, liberty, and property, and in the pursuit of happiness, both as respects privileges conferred and burdens imposed." [Levine v. Institutions & Agencies Dept. of N.J., 84 N.J. 234, 256 (1980), quoting from Washington National Ins. Co. v. Bd. of Review, 1 N.J. 545, 553 (1949)].
See also Domenick v. Taxation Div. Director, 176 N.J. Super. 121, 128 (App.Div. 1980).
In analyzing equal protection claims under the Fourteenth Amendment, our courts have adopted a three tier approach. Where a statutory classification implicates a "fundamental right" or "suspect class", the statute must, under the "strict scrutiny" test, further a compelling state interest by the least restrictive means. Barone, 107 N.J. at 365 citing Graham v. Richardson, 403 U.S. 365, 91 S.Ct. 1848, 29 L.Ed.2d 534 (1971). A suspect class has been defined as one:
... saddled with such disabilities, or subjected to such a history of purposeful unequal treatment, or relegated to such a position of political powerlessness as to command extraordinary protection from the majoritarian political process. San Antonio School Dist. v. Rodriguez, 411 U.S. 1, 28, 93 S.Ct. 1278, 1294, 36 L.Ed.2d 16, 40 (1973). [State v. Senno, 79 N.J. 216, 226 (1979)].
Additionally, "strict scrutiny" will be triggered when the classification is based upon an "immutable characteristic determined solely by the accident of birth." Frontiero v. Richardson, 411 U.S. 677, 686, 93 S.Ct. 1764, 1770, 36 L.Ed.2d 583, 591 (1973); Senno, 79 N.J. at 226.
Under the "second tier" of this analysis, statutes which indirectly affect "fundamental rights" or implicate "semi-suspect classes" must be "substantially related" to important government interests. Barone, 107 N.J. at 365-366. This "intermediate scrutiny" standard is most often applied in cases involving illegitimacy and gender-based discrimination. See generally, Trimble v. Gordon, 430 U.S. 762, 97 S.Ct. 1459, 52 L.Ed.2d 31 (1977) and Craig v. Boren, 429 U.S. 190, 97 S.Ct. 451, 50 L.Ed.2d 397 (1976).
Finally, if neither strict nor intermediate level scrutiny applies, the complainant must demonstrate that the statute is not *701 rationally related to the achievement of a legitimate state objective. Barone, 107 N.J. at 365, citing Dandridge v. Williams, 397 U.S. 471, 90 S.Ct. 1153, 25 L.Ed.2d 491 (1970). Under the "rational basis" standard, the scope of judicial review of legislative classification is extremely limited:
The equal protection clause of the Fourteenth Amendment does not deprive the State of the power to classify in the adoption of police laws, but allows wide discretion, precluding only that done without any reasonable basis and therefore purely arbitrary. The constitutionality of a legislative classification is presumed, and one who assails the classification must carry the burden of showing its arbitrariness. A classification having some reasonable basis is not invalid merely because it is not made with mathematical nicety or because in practice it results in some inequality. And the classification must be upheld if any set of facts can reasonably be conceived to support it. In short, the equal protection clause forbids only invidious discrimination. Morey v. Doud, 354 U.S. 457, 463-464, 77 S.Ct. 1344, 1 L.Ed.2d 1485, 1490 (1957); Williamson v. Lee Optical of Okla., 348 U.S. 483, 489, 75 S.Ct. 461, 99 L.Ed. 563, 573 (1955); New Jersey Restaurant Ass'n v. Holderman, 24 N.J. 295, 300-302 (1957). [David v. Vesta Co., 45 N.J. 301, 314-315 (1965)]. See also Barone, 107 N.J. at 369-370.
"In the absence of invidious discrimination, however, a court is not free under the aegis of the Equal Protection Clause to substitute its judgment for the will of the people of a State as expressed in the laws passed by their popularly elected legislatures." Parham v. Hughes, 441 U.S. 347, 351, 99 S.Ct. 1742, 1745-46, 60 L.Ed.2d 269 (1979); Domenick, 176 N.J. Super. at 129.
Although the evaluation of equal protection claims under the State Constitution entails a more flexible "balancing test" which may provide greater protections, Barone, 107 N.J. at 368, the criteria involved are essentially the same as those applied in the Federal three-tier test. "Both tests consider the nature of the individual rights affected by the governmental action being challenged, the importance of the governmental interests being furthered, and the degree to which the challenged restriction is necessary to achieve those interests." Ibid.
Applying these principles here, it is clear that the preclusion of unmarried cohabitants from recovery under the Wrongful Death Act does not offend the Equal Protection clause of the *702 Fourteenth Amendment or its implicit presence in the State constitution. As noted in Parham, 441 U.S. at 358, n. 12, 99 S.Ct. at 1749 n. 12, where the Supreme Court upheld a Georgia statute denying a natural father the right to sue for his illegitimate child's wrongful death, "[it] cannot seriously be argued that a statutory entitlement to sue for the wrongful death of another is itself a `fundamental' or constitutional right." Moreover, the policy considerations involved in Schmoll v. Creecy are noticeably absent. Unlike the illegitimate child who is not at all responsible for the immutable stigma which attaches at birth, persons who voluntarily choose not to marry cannot be considered part of a suspect or quasi-suspect class. Rather, under the three tier approach outlined above, a rational basis exists for excluding unmarried cohabitants from the scope of the Wrongful Death Act, whether or not their children may be indirectly affected.
Although the United States Supreme Court has held that statutory classifications which directly and substantially interfere with the right to marry must be subject to rigorous scrutiny, Zablocki v. Redhail, 434 U.S. 374, 98 S.Ct. 673, 54 L.Ed.2d 618 (1978), "reasonable regulations that do not significantly interfere with decisions to enter into the marital relationship may legitimately be imposed". Id., 434 U.S. at 386, 98 S.Ct. at 681, citing Califano v. Jobst, 434 U.S. 47, 98 S.Ct. 95, 54 L.Ed.2d 228 (1977) (Where there existed a rational basis for Social Security Act provision terminating the benefits collected by plaintiff, a disabled dependent child, upon his marriage to spouse similarly disabled but not entitled to benefits under the Act, Court held that principle of equality embodied in due process clause of Fifth Amendment was not violated).
In Vogel v. Pan American World Airways, Inc., 450 F. Supp. 224 (S.D.N.Y. 1978), where plaintiff brought suit individually for the wrongful death of her divorced husband, the federal court for the Southern District of New York, applying California law, reached a conclusion similar to the one reached by the trial court below. As in New Jersey, California's wrongful *703 death act included by reference the laws of intestate succession. Plaintiff advanced an equal protection argument on the grounds that these laws defined as heirs "putative spouses" of void or voidable marriages but did not similarly include "meretricious spouses" such as plaintiff. In rejecting the argument that such an exclusion lacked a rational basis, the court reasoned as follows:
To begin with, the legislature could reasonably have concluded that the failure of meretricious spouses to adopt the responsibility of the marital vows and the legal obligation resulting from a formal marriage ceremony evidenced a lack of permanent commitment which made compensation for loss of monetary support too speculative to calculate. The legislature also could have legitimately found that the distinction between putative and meretricious spouses serves to avoid fraudulent claims and complicated proof at trial: While putative spouses can prove their relationship with the decedent through documentary evidence of their participation in a marriage ceremony, meretricious spouses would have to prove their relationship through more subjective, and therefore more difficult to evaluate, proof. Finally, the legislature could have rationally expected that its refusal to provide statutory property rights to meretricious spouses of its decedents would encourage its citizens to enter into formal matrimony, thereby promoting its recognized state interest in fostering the institution of formal marriage. [Id. at 226].
Accord Aspinall v. McDonnell Douglas Corp., 625 F.2d 325, 328 (9th Cir.1980).
Although here, plaintiff's argument is predicated upon the claim that her children will effectively be discriminated against by virtue of their mother's precluded claim, the underlying rationale is nevertheless the same: because it is "neither illogical nor unjust for society to express its `condemnation of irresponsible liaisons beyond the bounds of marriage'", Parham, 441 U.S. at 353, 99 S.Ct. at 1746-47, our Legislature's refusal to include unmarried cohabitants as beneficiaries under the laws of intestate succession, and thus, the Wrongful Death Act, is a rational means of promoting the institution of formal marriage, a legitimate state interest.
Consequently, in view of the fact that (1) the Wrongful Death Act has not been discriminatorily applied to preclude the individual claims of plaintiff's children, (2) the Act itself provides that all claimants will be entitled to no more than pecuniary *704 damages, and (3) there exists a rational basis for barring plaintiff's individual claims, we hold that neither plaintiff nor her children were denied equal protection under the law.
Accordingly, the orders dismissing plaintiff's individual damage claims are affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919137/ | 106 B.R. 436 (1989)
In re LOGUE MECHANICAL CONTRACTING CORP., Debtor.
COMMITTEE OF UNSECURED CREDITORS, Movant,
v.
Arthur H. LOGUE, Respondent.
COMMITTEE OF UNSECURED CREDITORS, Plaintiff,
v.
William LOGUE, Arthur H. Logue, and Helen M. Logue, His Wife, Defendants.
Bankruptcy No. 86-00085 PGH, Motion No. 86-5984, Adv. No. 86-612.
United States Bankruptcy Court, W.D. Pennsylvania.
November 9, 1989.
*437 Jeffrey T. Morris, Robert J. Blumling, Pittsburgh, Pa., for debtor.
Mark L. Glosser, Pittsburgh, Pa., for Committee of Unsecured Creditors.
Joseph F. McDonough, Pittsburgh, Pa., for William Logue, Arthur Logue and Helen Logue.
OPINION
WARREN W. BENTZ, Bankruptcy Judge.
Background
The debtor, Logue Mechanical Contracting Corp. ("Corporation") filed a petition for relief under Chapter 11 of the Bankruptcy Code on January 9, 1986. Arthur H. Logue was the controlling shareholder in the Corporation and served as the Corporation's Chairman of the Board of Directors and President. William M. Logue, Arthur's son, and the only other shareholder, served as the Corporation's Vice-President. Helen M. Logue served as Secretary/Treasurer and Director of the Corporation.
This matter is before the court for decision following an evidentiary hearing on the Committee of Unsecured Creditors' ("Committee") Motion objecting to the claim of Arthur M. Logue and the Committee's adversary proceeding filed with the court's permission on behalf of the Corporation against its principals seeking recovery of improper and unauthorized transfers.
Objection to Claim of Arthur H. Logue
Arthur Logue filed a proof of claim for unpaid salaries for years ending August 31, 1978, 1980, 1981, 1982, 1983, 1984 and 1985 in the total amount of $171,064 and for a balance due on three demand loans, in the amount of $70,000, $11,600 and $3,000, made on April 1, 1984, May 1, 1984 and July 22, 1984 respectively.
Corporate resolutions of the debtor discuss payment of back salary as follows:
WHEREAS, Arthur H. Logue has agreed that the corporation may pay the back salary due him when it can afford to do so.
BE IT RESOLVED, [unpaid salary] shall carry no interest and shall be paid only and when the financial status of the corporation improves.
The corporate resolutions represent an agreement between Arthur H. Logue and the Corporation that back salaries would be paid only if the Corporation could afford to do so. The Corporation's financial condition has deteriorated and it cannot afford to pay back salaries. Therefore, Arthur Logue's claim for back salaries must be denied.
Arthur Logue's claim for the balance due on demand loans requires a more detailed analysis. The Committee asserts that Arthur Logue's claim resulting from the loans should be denied or subordinated to the claims of other creditors on the basis of equitable subordination.
A corporation is generally an entity separate and distinct from its shareholders. In re Erie Drug Co., 416 Pa. 41, 204 A.2d 256 (1964); Zubik v. Zubik, 384 F.2d 267 (3rd Cir.1967). "[A] shareholder who in good faith advances money to a corporation for the corporation's benefit is not necessarily precluded from sharing in the distribution of assets upon the same terms as other unsecured creditors." Erie Drug, (citations omitted). However, the conduct of claimants who are "insiders" is subject to a high level scrutiny by the court when the issue of subordination is raised. Pepper v. Litton, 308 U.S. 295, 60 S. Ct. 238, 84 L. Ed. 281 (1939). As a director and officer of the Corporation, Arthur Logue is an "insider." 11 U.S.C. § 101(30)(B).
Statutory authority for equitable subordination is provided by 11 U.S.C. § 510(c) which states:
(c) Notwithstanding subsections (a) and
(b) of this section, after notice and a hearing the court may
*438 (1) under the principles of equitable subordination, subordinate for purposes of distribution, all or part of an allowed claim or all or part of an allowed interest . . .
Interpretation of this section by the courts has resulted in a tripartite test. The three elements of equitable subordination are:
(1) The claimant must have engaged in some type of inequitable conduct.
(2) The misconduct must have resulted in injury to the creditors of the bankrupt or conferred an unfair advantage on the claimant.
(3) Equitable subordination of the claim must not be inconsistent with the provisions of the Bankruptcy Code.
In re N & D Properties, Inc., 799 F.2d 726 (11th Cir.1986); In re Multiponics, 622 F.2d 709 (5th Cir.1980); In re Dan-Ver Enterprises, Inc., 86 B.R. 443 (Bankr.W.D. Pa.1988); In re Purco, 76 B.R. 523 (Bankr. W.D.Pa.1987).
Undercapitalization is a basis for subordination where the claimant is a director, shareholder, or other insider. Dan-Ver, 86 B.R. at 448. "Creditors and shareholders assume different risks and receive different rewards. When a corporation is undercapitalized, a shareholder must not be permitted to call his capital contribution a loan, in order to reduce the risk of loss." Dan-Ver, 86 B.R. at 450-51 citing In re McFarlin's Inc., 49 B.R. 550 (Bankr.W.D. N.Y.1985).
Shareholder loans may be deemed capital contributions in one of two circumstances: where a corporation is initially undercapitalized or where the loans were made when no other disinterested lender would have extended credit. In re N & D Properties, Inc., 799 F.2d 726 (11th Cir.1986); In re Multiponics, 622 F.2d 709 (5th Cir.1980); In re Trimble, 479 F.2d 103 (3rd Cir.1973).
The Corporation was formed in 1977; it was capitalized at $2,000. As stated in the Corporation's financial statement for fiscal year ending August 31, 1978:
"Company was incorporated in Pennsylvania and officially began operations on September 1, 1977 with active, incomplete contracts acquired from L & H Plumbing and Heating Company. Capital stock issued as of August 31, 1978 totalled 200 common shares, par value $10.00 per share."
In addition to initial capital of $2,000, the Corporation acquired the existing contracts from Arthur Logue's pre-existing business. Financial statements of the Corporation reflect a solvent and profitable operation for several years following incorporation.
In light of the acquisition of existing contracts at the time of incorporation and the subsequent period of profitability, it cannot be found that the Corporation was undercapitalized at its inception.
The balance sheet and profit and loss statement for the fiscal year ending August 31, 1983 show that retained earnings at the beginning of the fiscal year 1983 were $66,746 and that the retained earnings declined to $8,870 at the end of the fiscal year. There was a decrease in working capital in 1983 of $77,383 and a loss in the year 1983 of $55,876.
Corporate resolutions document the issuance of demand notes to Arthur Logue for loans dated in April, May and July, 1984. In addition, cancelled checks reflecting the loans by Arthur Logue were introduced into evidence. Arthur Logue made loans to the Corporation as a separate entity, not as an "alter ego" of himself. Correct procedures and formalities were followed.
Although the Corporation had suffered losses, it maintained a positive net worth at the end of the last fiscal year prior to Arthur Logue's loans to the Corporation. There is no evidence that the Corporation could not have borrowed a similar amount of money from other sources at the time the loans were made by Arthur Logue. The financial report of the Corporation for fiscal year ending August 31, 1984 reflects a continued deterioration in the financial condition of the Corporation.
"One of the primary functions of bankruptcy is to provide a fair and organized distribution of the estate assets to creditors. If insiders have misused the debtor, *439 preferring themselves over others, and have created for themselves an unfair advantage, then the principals of fairness would be violated by permitting the insider to partake of the distribution in equal share with the other creditors." Dan-Ver, 86 B.R. at 448-49 citing In re McFarlin's, supra.
The loans here were real and genuine. Arthur Logue loaned money to the Corporation for the purpose of benefitting the Corporation. There is no evidence that the loans were made in the absence of good faith or that there was any fraud or improper purpose in the transactions. Arthur Logue had only demand notes and no other security. Logue was not provided an automatic priority for these loans. Arthur Logue created no unfair advantage for himself.
Equitable subordination of Arthur Logue's loan claim is not required. Classification of the advances as debt is fair and equitable. Sharing in any distribution equally with other creditors does not give Arthur Logue an unfair advantage.
Arthur Logue's claim in the amount of $88,832.90 for the balance on loans made to the Corporation will therefore be allowed as an unsecured claim.
Recovery of Unauthorized and Inappropriate Transfers
When the Corporation filed its Chapter 11 petition, it had no secured or priority debts and had $147,572.30 on deposit in the bank. This amount declined by $110,386.71 during the nine month Chapter 11 proceedings to $37,186.59. When the Corporation filed its Chapter 11 petition, it was actively working on only two jobs. Both of these jobs were rejected immediately after the Chapter 11 petition was filed as the Corporation was losing money on them.
In January and February, 1986, the Corporation bid two other jobs. It obtained neither job and had no further activity except for two other bids made in May, 1986.
During the nine month Chapter 11 proceedings, the Corporation did not get one job. However, the Corporation continued to incur overhead. Substantial payments were made to Arthur and William Logue in the form of wages, benefits and rent despite the lack of business activity.
The Committee seeks a judgment against the principals of the Corporation in such amount as will restore the Corporation's cash balances to the balance that existed at the date of filing of the Chapter 11 debtor.
Arthur and William Logue assert that the decision to pursue reorganization of the Corporation is a business decision judged by the "business judgment rule" and that the payments of salary and rents were in exchange for valuable services rendered to the Corporation.
William Logue asserts that he maintained, protected and inventoried equipment, looked for buyers for the company, began liquidation efforts, and conducted claims analysis. Arthur Logue claims to have sought jobs and attempted to find buyers for the company, and completed administrative duties.
Under Pennsylvania law, directors, officers and controlling shareholders stand in a fiduciary relationship to the Corporation and stockholders and creditors of the Corporation. In re Simplified Information Systems, Inc., 89 B.R. 538 (W.D.Pa.1988); In re Complete Drywall Contracting, Inc., 11 B.R. 697 (Bankr.E.D.Pa.1981). Directors and officers may be held liable for losses suffered by the Corporation as a result of their failure to use reasonable and ordinary skill, care and diligence in the conduct of corporate business. Simplified Information Systems, 89 B.R. at 545. In discharging their fiduciary duties, directors and officers are protected against unwarranted interference with their decisions by the "business judgment rule." Enterra Corp. v. SGS Associates, 600 F. Supp. 678, 684 (E.D.Pa.1985). However, the business judgment rule does not apply in the face of bad faith or dealing in self-interests.
The following is a summary of the information contained in the Corporation's monthly operating schedules: *440
End of Month
Income Expenses Cash Balances
January 9, 1986 (beginning balance in DIP acct.) $147,572.30
January 1986 $9,540.29 $24,944.77 132,167.82
February 1986 585.48 19,619.63 113,133.67
March 1986 0 16,581.74 96,551.93
April 1986 0 19,264.19 77,287.74
May 1986 0 11,795.90 65,491.84
June 1986 1,349.56 12,043.96 54,797.44
July 1986 0 9,042.28 45,755.16
August 1986 6,164.84 9,682.49 42,389.01
September 1986 0 5,202.42 37,186.59
Despite the lack of business operations and in many months absolutely no income, the Logues unnecessarily caused the Corporation to remain in business and incur substantial overhead and operating expenses, all of which caused the Corporation's cash balance to decline by over $110,000 in the nine month period from January 1986 through September 1986. The majority of the overhead and operating expenses of the Corporation inured to the benefit of the Logues.
Continued operation benefitted only the Logues to the detriment of the Corporation and its creditors. Evidence clearly shows that almost immediately after the filing of the petition, the Corporation ceased all operations and had no hope of reorganizing. Yet, the Logues, as the Corporation's stockholders, officers and directors elected to continue operations and receive payments in the form of salaries and rents in furtherance of their self-interests.
The Corporation incurred over $110,000 in costs during the Chapter 11 proceeding. The Logues suggest that continued operation of the business was justified because it enabled the Corporation to sell its assets for the highest and best price. The assets eventually sold for approximately $45,000. The same price likely could have been obtained by an auctioneer much earlier in the case and eliminated the need for storage and rental payments. In any event, the incurrence of $110,000 in expenses to sell assets valued at $45,000 makes no sense and is not justifiable. No benefit was conferred to the Corporation by the Logues' services in assisting to sell the assets.
Likewise, the Logues' services in attempting to obtain jobs rendered no value to the Corporation. Four bids were made and no jobs were obtained. The minimal activities performed by the Logues do not justify the expense incurred in the continued operation of the Corporation.
The Logues further claim the ongoing Chapter 11 proceeding was justified by the fact that the principals of the Corporation assisted in collecting receivables. This argument cannot bear close scrutiny. The monies received were refunds, accounts receivable, sales of inventory and for work completed prior to the Chapter 11 filing date. William Logue testified at trial that he would have helped a trustee collect these same receivables had the Corporation been in a Chapter 7 proceeding. It was totally unnecessary for the Corporation to incur added expense in attempting to collect its receivables.
We determine that the Logues violated their fiduciary obligation to the Corporation and its creditors. Their dealings with the Corporation cannot bear close scrutiny.
The evidence indicates that it was clear immediately after the filing that the Corporation could not reorganize. The Logues' counsel advised the court that within six weeks of filing, it had been determined to liquidate the Corporation. Why then did the Corporation continue to incur these expenses? We find that the Logues continued to operate the business solely for the *441 benefit of receiving salaries, benefits and rents. A reasonable person using ordinary skill, care and diligence would have immediately ceased operations and proceeded to liquidate the business to maximize the return to creditors. This liquidation could have been accomplished by March 31.
We therefore hold that the Logues are liable for the decrease in cash balance from March 31, 1986 through September, 1986. The cash balance on March 31, 1986 was $96,551.93 and the balance as of September 30, 1986 was $37,186.59. The Logues will therefore reimburse the Corporation for the difference of $59,365.34. An appropriate order will be entered.
ORDER
This 9th day of November, 1989, in accordance with the accompanying Opinion, it shall be, and hereby is, ORDERED:
1. Arthur H. Logue's proof of claim as it relates to salary claims in the amount of $171,064 is DISALLOWED.
2. Arthur H. Logue's proof of claim as it relates to loans in the amount of $88,832.90 is ALLOWED as an unsecured claim.
3. Arthur H. Logue, William M. Logue and Helen Logue are to reimburse Logue Mechanical Contracting Corp. the sum of $59,365.34 for inappropriate and unauthorized transfers. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919138/ | 541 A.2d 155 (1988)
Kenneth E. TAYLOR et al.
v.
James H. HANSON et al.
Supreme Judicial Court of Maine.
Argued January 7, 1988.
Decided April 21, 1988.
Paul C. Fournier, Rocheleau, Fournier & Lebel, Lewiston, for plaintiffs.
Roscoe H. Fales (orally), Fales & Fales, Lewiston, for defendants.
*156 Before McKUSICK, C.J., and NICHOLS, ROBERTS, WATHEN, GLASSMAN and SCOLNIK, JJ.
GLASSMAN, Justice.
The defendants, James H. and Anne H. Hanson (Hansons), appeal from a judgment of the Superior Court, Androscoggin County, adopting a referee's report fixing the location of the boundary between the Hansons' land and land owned by the plaintiffs, Kenneth H. Taylor, Ruth A. Taylor and Scott E. Taylor (Taylors). The Hansons claim that the referee erred in the interpretation of the controlling deed and was clearly erroneous in finding that the Hansons had failed to prove the boundary by acquiescence. The Taylors cross-appeal contending the court erred in denying their claim for damages, injunctive relief and costs. We affirm the judgment.
I
The Taylors own property in Turner that abuts the disputed southern line of the Hansons' property. The Taylors purchased the property in 1976 from Kenneth Taylor's mother, who had owned it since 1968. The Hansons purchased their property in 1953. In July 1982 the Taylors brought this action pursuant to M.R.Civ.P. 80A seeking declaratory relief as to the disputed boundary, actual and treble trespass damages, a permanent injunction against future trespasses and costs. The Hansons counterclaimed seeking a declaration of title, boundary by acquiescence, trespass damages, injunctive relief, and costs. The case was submitted to a referee pursuant to M.R.Civ.P. 53(b). At the reference, the parties agreed that the Hansons' deed was the controlling deed. The deed reads as follows:
Commencing at the southeasterly corner of Walter McKinney's land at a point on the Turner Road, so-called, thence running westerly along said McKinney's land in a straight line beyond McKinney's line to a stone road,[1] so-called: a distance of about one thousand eight hundred (1,800) feet: thence running southerly along said stone road one hundred (100) feet to a stake and stone: thence running in a line parallel to the first mentioned line to the Turner Road:[2] thence northerly along the line of the Turner Road one hundred (100) feet to the point of beginning.
The parties also agreed on the beginning monument: "the southeasterly corner of Walter McKinney's land at a point on the Turner Road" and on the first call of the deed, "thence running westerly along said McKinney's land in a straight line ... to a stone road...." as establishing the northern boundary of the Hansons' land. Further, the parties agreed on the location on Stone Road of the terminus of the first call and that the angle of Stone Road is S 1° 41' 32" E. The second call, "thence running southerly along said stone road one hundred (100) feet to a stake and stone," forms the western boundary of the Hansons' land. Each party had hired a surveyor who appeared and testified at the hearing. Neither surveyor found a "stake and stone" at the extremity of the 100 foot call.
The Taylors' surveyor established the southwest corner of the Hansons' land at the southerly end of the 100 foot call along Stone Road but the Hansons' surveyor disregarded the 100 foot call and measured 119.76 feet. Both surveyors followed the third call, "thence running in a line parallel to the first mentioned line to the Turner Road." However, because of the difference in the starting points for the third call, there is approximately a 20-foot difference between the contested southern boundary as drawn by the surveyors. The last call states "thence northerly along the Line of the Turner Road one hundred (100) feet to the point of beginning." The Taylors' surveyor found that it was only 82.56 feet along Turner Road to the point of beginning. The Hansons' surveyor, because *157 he had disregarded the distance of the second call on Stone Road, was able to terminate the southerly line of the Hansons' property on Turner Road exactly 100 feet from the point of beginning.
After a full hearing, the referee found, inter alia, that the disputed common boundary between the land of the parties was as drawn by the Taylors' surveyor and recommended that judgment be entered for the Taylors in accordance therewith. From the judgment of the Superior Court establishing the common boundary between the land of the parties as recommended by the referee and denying both parties damages, injunctive relief and costs, the Hansons appeal, and the Taylors cross-appeal.
II
The Hansons first contend that the referee erred in finding the language of the description in the deed to be unambiguous and in failing to find that as of the date of the deed from the original grantor to the Hansons' predecessor grantee their obvious intention was that exactly 100 feet on Turner Road and approximately 100 feet on Stone Road be conveyed to the grantee. Although we hold that the referee erred in finding the deed to be unambiguous, we find the error harmless under standard rules of construction.
When interpreting a deed, one should first look for the controlling intent of the parties on the face of the deed. First Hartford Corp. v. Kennebec Water Dist., 490 A.2d 1209, 1211 (Me.1985). However, a latent ambiguity can render that intent unclear. A latent ambiguity in a deed is created when, in applying the description to the ground, facts extrinsic to the document controvert or in some way render unclear the deed's apparently unambiguous terms. See 6 Thompson on Real Property, § 3026 at 469-70 (1962 & Supp. 1981). Here, the referee erred in finding the deed to be unambiguous because the deed calls for western and eastern boundaries of 100 feet each, and for parallel northern and southern boundaries. The western and eastern boundaries, Turner Road and Stone Road, are not parallel on the face of the earth. Accordingly, given the constraints of parallel northern and southern boundaries, measuring 100 feet on Stone Road does not produce 100 feet on Turner Road.
When, as here, a latent ambiguity is created by extrinsic evidence (the angle of Stone Road), it has long been established that a trial court or referee must admit relevant extrinsic evidence to attempt to cure the ambiguity. See, e.g., Tyler v. Fickett, 73 Me. 410, 416 (1882) (where latent ambiguity exists "[r]esort must be had to existing circumstances and to the contemporaneous construction put upon the deeds by the parties."); see also Perreault v. Toussaint, 419 A.2d 1009, 1011 (Me. 1980) (extrinsic evidence properly admitted only to clarify specifications in deed found insufficient to locate southeastern corner of property); Greeley v. Weaver, 13 A. 575, 575-76 (Me.1888) (where calls in deed failed to close property extrinsic evidence properly admitted).
While we agree with the Hansons' claim that the deed contains a latent ambiguity, they take nothing from this argument. The Hansons not only stipulated to the terminus of the first call in the deed and the angle of Stone Road, they offered no probative evidence of the "contemporaneous construction put upon the deeds by the parties." Tyler v. Fickett, 73 Me. at 416. There was no evidence that the original parties to the controlling deed[3] intended that 100 feet on Turner Road should control over 100 feet on Stone Road.[4]
*158 The Hansons also argue that rules of construction favor a finding that 100 feet on Turner Road controls over 100 feet on Stone Road. We disagree. A basic rule of construction used to discern the parties' intent in the conveyancing of real estate is that "boundaries [are] established in descending order of control by monuments, courses, distances and quantity." Conary v. Perkins, 464 A.2d 972, 975 (Me.1983); Kinney v. Central Maine Power Co., 403 A.2d 346, 350 (Me.1979); Rusha v. Little, 309 A.2d 867, 870 (Me.1973). Without any specific evidence that the original parties intended otherwise, and because the results here are not absurd or manifestly inconsistent with the parties' intentions apparent from the face of the deed, the standard rules of construction, when properly applied, will control. Kinney v. Central Maine Power Co., 403 A.2d at 350. See also Proctor v. Hinkley, 462 A.2d 465, 472 (Me.1983) (when establishing boundary by line due east from stake has result both absurd and inconsistent with other provisions of deed, term "east" in deed means only "in an easterly direction").
Here, the parties agree on both the first call and the angle of the second call along Stone Road. Both parties agree that no controlling monument was found at the southern terminus of the western boundary. Because no monument was found, and because the angle of and course along Stone Road were not in dispute, the referee properly held that the second call should terminate at precisely 100 feet, as called for in the deed. The third call, the disputed southern boundary, runs easterly and terminates on Turner Road. While this call simply runs "to the Turner Road," no terminal monument is needed because the deed determines its course as parallel to the undisputed first call, the Hansons' northern boundary.
The fourth call runs 100 feet along Turner Road to the established monument at the point of beginning, i.e., the "corner of Walter McKinney's land." The Taylors' surveyor, having properly followed the 100 foot distance along Stone Road for the second call, and drawing the third call easterly to Turner Road parallel to the first call, found only 82.56 feet along Turner Road to the point of beginning. In this instance monuments and courses control distances, and the third call properly terminates at Turner Road leaving only 82.56 feet along Turner Road to close the property by reaching the monument marking the point of beginning. See, e.g., Conary v. Perkins, 464 A.2d at 975.
The Hansons argue, however, that the referee was under a duty to resolve the ambiguity in the deed by reversing the order of measuring the calls. Doing so would call for exactly 100 feet on Turner Road, rather than 82.56 feet. Without any probative extrinsic evidence that the original parties to the deed intended this, however, standard rules of construction do not require reversing the calls when the typical forward measurement, beginning with the first call, produces no problems unsolvable by the rules of construction themselves.
We have approved a process of locating an ambiguous or unknown starting monument by measuring a known course backward from the terminus of the first call. Perreault v. Toussaint, 419 A.2d at 1011; Williamson v. Gooch, 103 Me. 402, 403-04, 69 A. 691, 692 (1908); Seidensparger v. Spear, 17 Me. 123, 127 (1840). In this case, however, there is no dispute as to the starting monument. Moreover, we have long recognized that harmonizing all the calls in a deed should be a priority in deed interpretation. Pike v. Munroe, 36 Me. 309, 315 (1853). The adopted interpretation gives equal weight to and harmonizes all the calls in the deed according to the intention of the parties as construed under the standard rules of construction. See Kinney v. Central Maine Power Co., 403 A.2d at 349.
The Hansons also claim no effort was made to locate Stone Road as it existed in *159 1921. The referee had a duty to locate, if possible, a monument on the face of the earth. Ricci v. Godin, 523 A.2d 589, 592 (Me.1987). The parties, however, agreed on the precise angle of the western boundary following Stone Road. There was no evidence whatsoever that this angle along Stone Road was inconsistent with the angle as it existed in 1921. Thus, there was no error.
Lastly, the Hansons argue that the term "parallel" in the deed should be read to mean "roughly parallel." By such a reading one could apply the description to the ground simply by measuring 100 feet on both Stone and Turner Roads and connecting them on the north by following the undisputed first call and to the south by drawing a straight line from the southern terminus of Stone Road to the southern terminus of Turner Road. The resulting southern boundary would not, of course, be an equal distance at all points from the northern boundary. In Hodgdon v. Campbell, 411 A.2d 667, 672 (Me.1980), we acknowledged that other jurisdictions have defined parallel to mean "with like direction or tendency." In Hodgdon, however, the proper definition of the term "parallel" in a deed was not before the court. Id. Rather, we merely noted that the appellants had failed to challenge the referee's definition of parallel to mean "with like direction or tendency." Id. Here, because neither natural monuments nor the parties' intentions compel such a deviation, we decline to adopt a deviant line that would upset the standard rules of construction.
III
The Hansons also contend the referee erred in finding that they failed to prove their boundary by acquiescence. The Hansons were required to prove acquiescence by clear and convincing evidence. Calthorpe v. Abrahamson, 441 A.2d 284, 289 (Me.1982).[5] We review the Superior Court's adoption of the referee's finding of facts for clear error.[6] If there is credible, probative evidence supporting the finding, we must uphold the judgment. Severance v. Choate, 533 A.2d 1288, 1290 (Me.1987); Aalberg v. Stevens, 489 A.2d 1, 3 (Me. 1985).
To prove their possession up to a "visible line," recognized and acquiesced in by the Taylors, the Hansons rely on their planting of ornamental Chinese elm trees along a portion of what they believed to be the southern boundary of their property, a pattern of mown grass, the location of a chicken shed, and of a defunct septic tank and a dirt path meandering in an east-west direction in the southwest quadrant of their property.
The record discloses that the Hansons had cut the Chinese elms three years after the Taylors acquired their property, that the Taylors' tenant had been responsible for mowing the grass on the Taylors' property and had done so sporadically up to the Chinese elms, and that the chicken shed, defunct septic tank and dirt path were not in line with the elms or with each other. Accordingly, the referee properly found that because "no definite boundary [between the properties] was established at any time or any location" and because the Taylors could not acquiesce in a boundary that they could not identify with certainty, the Hansons' failed to establish any of the elements of acquiescence to the boundary line claimed by them.
IV
In their complaint the Taylors sought trespass damages for removal of the Chinese *160 elm trees. The referee determined that although the trees were in fact on the Taylors' land, the removal of the trees did not affect the value of the Taylors' property. The referee stated that no trespass damages were due because "the area in which the land is located is commercial and was commercial in 1979 when the cutting complained of occurred." On their cross-appeal, the Taylors challenge this factual finding, and we review for clear error. Severance v. Choate, 533 A.2d at 1290. The agreed upon measure of damages was the difference between the "market value of the land immediately before and immediately after the injury." Nyzio v. Vaillancourt, 382 A.2d 856, 861 (Me.1978).
The referee heard three local realtors testify that the Taylors' property, if put on the open market, would most likely attract a commercial buyer, and the presence or absence of trees made little or no difference to the property's value. The referee heard the following evidence that the Taylor property was in a commercial area:[7] there is 1) a restaurant nearby with parking on both sides of the street, 2) a gas station and convenience store just beyond the restaurant, 3) another gas station and a Kawasaki dealer across the street, 4) a small airport just north of the gas station, and 5) Hanson's own used car dealership next door.
The Taylors presented no evidence that some or all of the commercial enterprises surrounding their property were not in existence in 1979. Thus, the referee's finding that the area was commercial in 1979, and the loss of the trees gave rise to no damages, is not clearly erroneous.
The Taylors other claims are without merit.
The entry is:
Judgment affirmed.
All concurring.
NOTES
[1] Presently known as the Stone Road.
[2] Stone and Turner Roads no longer form the actual western and eastern boundaries of the Hansons' property. Because these roads remain the appropriate boundaries for purposes of the surveys, however, we refer to them as the western and eastern boundaries of that land.
[3] The controlling deed was drawn and originally conveyed in 1921 from George Bouchles to Patrick Collins.
[4] While the evidence at reference indicated that Turner Road was a relatively prominent, traveled road, and Stone Road was and is merely an unpaved "woods road," such evidence does not speak to whether 100 feet on Stone Road or 100 feet on Turner Road was intended to control. The only evidence bearing on the intent of the parties, admitted but apparently not considered by the referee, was the surmise of Hanson's surveyor that "a property owner [in 1921] most likely would have considered the Turner Road more valuable," and "probably the intent was 100 feet on the old Turner Road." Even if the referee had considered this evidence, it would, as a matter of law, have been insufficient to clarify the intentions of the original parties. See Conary v. Perkins, 464 A.2d 972, 975 (Me. 1983) ("a surveyor may not rest his judgment on what he thinks the intention of the parties may have been contrary to [accepted rules of construction]").
[5] In that case we noted the following elements of acquiesence:
(1) possession up to a visible line marked clearly by monuments, fences or the like; (2) actual or constructive notice to the adjoining landowner of the possession; (3) conduct by the adjoining landowner from which recognition and acquiescence not induced by fraud or mistake may be fairly inferred; (4) acquiescence for a long period of years such that the policy behind the doctrine of acquiescence is well-served by recognizing the boundary. Calthorpe, 441 A.2d at 289.
[6] In a non-jury reference, as here, the Superior Court must accept the referee's factual findings unless they are clearly erroneous. M.R.Civ.P. 53(e)(2).
[7] The record does not indicate how the property was zoned under local ordinances. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919186/ | 541 A.2d 1254 (1988)
Richard MASSEY, Defendant Below, Appellant,
v.
STATE of Delaware, Plaintiff Below, Appellee.
Supreme Court of Delaware.
Submitted: February 11, 1988.
Decided: April 28, 1988.
Lawrence J. Connell, Delaware Law School Postconviction Relief Clinic, Wilmington, for appellant.
Timothy J. Donovan, Jr., Deputy Atty. Gen., Wilmington, for appellee.
Before HORSEY, MOORE, and WALSH, JJ.
HORSEY, Justice:
This postconviction relief appeal concerns an effort to impeach a jury verdict for alleged juror misconduct more than nine years after the verdict was rendered. The alleged misconduct involves one juror's purported use of alcohol and drugs during the course of defendant's murder trial. After several postconviction relief motions and appeals, the Superior Court held an evidentiary hearing on the issue. Finding insufficient evidence of juror misconduct to *1255 impeach defendant's verdict, the Court denied defendant relief and defendant appealed. The issues on appeal are: (1) the appropriate burden of proof for a defendant to successfully challenge a jury verdict based on juror misconduct; and (2) whether defendant met that burden. We hold that to impeach a verdict based on juror misconduct, a defendant must establish actual prejudice unless defendant can show that the circumstances surrounding the misconduct were so egregious and inherently prejudicial so as to support a presumption of prejudice to defendant. We find that this defendant has failed to meet that burden; therefore, we affirm.
I
In June 1978, defendant was convicted by jury of murder in the first degree, robbery in the second degree, and other related crimes. Defendant's convictions were affirmed by this Court on direct appeal. Martin v. State, Del.Supr., 433 A.2d 1025 (1981), cert. denied, 454 U.S. 1151, 102 S.Ct. 1018, 71 L.Ed.2d 306 (1982). In April 1981, defendant, invoking Superior Court Criminal Rules 33 and 35(a), moved Superior Court for a new trial. He alleged that during the trial one of the jurors was under the influence of drugs and alcohol.[1]
When an evidentiary hearing was granted defendant, the complaining juror then invoked his Fifth Amendment right against self-incrimination and refused to testify.[2] The Superior Court then denied defendant's request that the juror be granted immunity. However, the Court permitted the other jurors to be deposed by written interrogatories regarding the complaining juror's behavior during trial. On the basis of the juror's responses, the Superior Court found no evidence of juror misconduct and denied defendant's first motion for a new trial; this Court affirmed that decision. State v. Massey, Del.Super., No. I-77-11-0985-0992, O'Hara, J. (July 22, 1982), aff'd sub nom. Martin v. State, Del.Supr., No. 269, 1982, Horsey, J. (Oct. 24, 1983) (ORDER).
Defendant then sought habeas corpus relief in the United States District Court for the District of Delaware. The District Court dismissed the petition for failure to exhaust state remedies. Massey v. Redman, C.A. No. 84-655, Longobardi, J. (March 1985).
Defendant then filed a second State application for postconviction relief asserting the same juror misconduct claim but raising a new issue that the State had intimidated the complaining juror with threats of prosecution, causing the juror not to testify. The Superior Court denied the motion, defendant appealed, and we affirmed the Superior Court's finding that the State had not intimidated the complaining juror into not testifying. However, by then, the statute of limitations had run for the State to prosecute the juror. Therefore, we remanded with instructions that the Court should hold an evidentiary hearing "on the question of the complaining juror's asserted incompetency at trial as a basis for impeaching the verdict against defendant." Massey v. State, Del.Supr., 514 A.2d 402, 404 (1986).
At the evidentiary hearing, the Superior Court admitted the deposition testimony of nine jurors (excluding the complaining juror) concerning defendant's claim of drug and alcohol use during defendant's trial. None of the deposed jurors could recall any incidents during the trial that would indicate that the complaining juror was under the influence of drugs or alcohol. The chief prosecutor's testimony at the hearing corroborated the jurors' testimony.
Defendant's witnesses included the complaining juror, his mother, and the juror's *1256 drug counselor.[3] The complaining juror testified contrary to the other jurors. He stated that during the trial he smoked marijuana in the morning before going to the courthouse; drank two to three beers during the luncheon recess; drank two six-packs of beer each night; customarily used methamphetamines on the weekends during that time; and shared a case of beer with the other jurors during the deliberations when the jury was sequestered overnight at a local hotel. The juror's mother generally supported her son's testimony that he suffered from a substance abuse problem, but she was unable to recall the nature and extent of his specific abuse that occurred during the trial. The complaining juror's drug counselor could testify of his own knowledge only as to the juror's substance abuse problems the year following the trial. Although the drug counselor had not, prior to the hearing, questioned the complaining juror about his use of drugs and alcohol during defendant's trial, the witness opined, after hearing the complaining juror's testimony, that his "capabilities to serve as a juror would [have been] seriously impaired" at defendant's trial.
At the conclusion of the evidence, the Trial Judge asked the parties for their views on the controlling burden of proof. Both agreed that the defendant had the initial burden of proof. However, defendant argued that his burden was limited to establishing a "reasonable probability" of the complaining juror's impairment during trial. The consequence of finding a reasonable probability of impairment, defendant argued, was that the substance abusing juror was necessarily incompetent and incapable of hearing what was going on at trial, evaluating the merits of the case, and forming a judgment as to defendant's guilt or innocence. Hence, defendant argued, he was deprived of his right to an impartial jury.
The State disagreed. It argued that the defendant had a two-tiered burden: (i) to present evidence supporting a reasonable probability of juror impairment sufficient to warrant an evidentiary hearing on the subject; and (ii) if an evidentiary hearing were granted, to prevail, defendant must then prove, by a preponderance of the evidence, actual impairment sufficient to render the juror incapable of rational conduct.
On the evidence presented at the evidentiary hearing and with no written memoranda of law from counsel, the Trial Court, in a bench ruling, denied defendant's motion for a new trial. Without deciding the burden of proof issue, the Court ruled that even under defendant's proffered standard of reasonable probability of impairment, the defendant had not met his burden. The Court stated, "One can look in vain throughout this record ... to find any corroboration other than [the complaining juror's] own statement that the drug use that he claims he was engaging in existed."
The following day, defense counsel asked the Court to reconsider its decision in light of Wiser v. People, Colo.Supr., 732 P.2d 1139 (1987), and holding of the majority opinion that a defendant need only show a "reasonable possibility" that extraneous influence affected the jury's verdict. Again, the Trial Court avoided ruling on the burden of proof issue. While declining to adopt the Wiser standard, the Court stated that even under the least restrictive Wiser standard, the defendant did not meet his burden.
On appeal, defendant, without any discussion of Delaware law, urges this Court to adopt the Wiser standard of reasonable possibility of juror impairment through drug or alcohol use. Defendant does so assuming that the Delaware courts have never spoken on the subject. The assumption is unwarranted, as the most cursory search of Delaware case law discloses.
II
It is established law in Delaware that juror bias will not be tolerated. See *1257 Styler v. State, Del.Supr., 417 A.2d 948, 951 (1980). A defendant can be denied his Sixth Amendment right to an impartial jury if only one juror is improperly influenced. See id. But there is an equally well-established general common law prohibition against impeaching jury verdicts once the jury has been discharged. See McDonald v. Pless, 238 U.S. 264, 267, 35 S.Ct. 783, 784, 59 L.Ed. 1300, 1302 (1915); Sheeran v. State, Del.Supr., 526 A.2d 886, 894 (1987) (which permits only two exceptions, both codified in our Rules of Evidence). Delaware Rule of Evidence 606(b) permits juror testimony for the purposes of impeaching a verdict in two instances: (1) when "extraneous prejudicial information [is] improperly brought to the jury's attention"; or (2) when "outside influence [is] improperly brought to bear upon any juror." D.R.E. 606(b).[4] Nevertheless, inquiry into the jurors' mental processes remains prohibited. See id.; Burke v. State, Del.Supr., 484 A.2d 490, 500 (1984).[5] It is this prohibition of defendant's impeachment effort which falls outside both of the recognized exceptions of D.R.E. 606(b). Further, our standard of review requires us to accord the trial court broad discretion in determining the mode and depth of investigative hearings into allegations of juror misconduct and the appropriate remedy. See Sheeran, 526 A.2d at 897. The trial judge's determination will be disturbed only on a finding of abuse of discretion. Lovett v. State, Del.Supr., 516 A.2d 455 (1986), cert denied, ___ U.S. ___, 107 S.Ct. 1898, 95 L.Ed.2d 504 (1987); see also Sheeran, 526 A.2d at 897; Burke, 484 A.2d at 501.
While defendant asserts that the question of a moving party's burden of proof when seeking to impeach a verdict for alleged juror misconduct is one of first impression in Delaware, he is mistaken. We find our decisions in Hughes v. State, Del.Supr., 490 A.2d 1034 (1985), and McCloskey v. State, Del.Supr., 457 A.2d 332 (1983), to be controlling. In Hughes, this Court reversed defendant's conviction for juror bias and remanded for a new trial. The bias resulted from some jurors' having learned before being impanelled that the defendant had previously been tried and convicted for the same crimes and that defendant had submitted to a polygraph examination. We stated that a "defendant is entitled to a new trial only if the error complained of resulted in actual prejudice or so infringed upon defendant's fundamental right to a fair trial as to raise a presumption of prejudice." Hughes, 490 A.2d at 1043. Generally, a defendant must prove he was "identifiabl[y] prejudice[d]" by the juror misconduct (id. at 1046 (quoting Estes v. Texas, 381 U.S. 532, 542, 85 S.Ct. 1628, 1632, 14 L.Ed.2d 543, 550, reh'g denied, 382 U.S. 875, 86 S.Ct. 18, 15 L.Ed.2d 118 (1965))), unless the defendant can establish the existence of "egregious circumstances," i.e., circumstances that, if true, would be deemed inherently prejudicial so as to raise a presumption of prejudice in favor of defendant. Id. at 1046-48. As the rule was stated in Hughes, if a defendant can show that there is a reasonable probability of juror taint of an inherently prejudicial nature, a presumption of prejudice should arise that defendant's right to a fair trial has been infringed upon. Id.
*1258 However, the issue of juror taint in Hughes arose pre-trial from the failure of the trial judge to conduct a proper screening of prospective jurors by voir dire. McCloskey is closer in point to the instant case. There, we found a reasonable probability of juror intimidation by an overbearing forelady during the course of trial sufficient to raise a presumption of prejudice. The Trial Judge, after interrogating the jurors, held private interviews with the forelady and the intimidated juror in the midst of jury deliberations. In our view, this rather unorthodox procedure increased the "likelihood of prejudice based upon perceived privileged or special access." McCloskey, 457 A.2d at 338-9 n. 8; see also Sheeran, 526 A.2d at 895-6. Contrary to Hughes, McCloskey does not espouse the threshold distinction between a required showing of actual prejudice and a presumption of prejudice. However, we think that the two decisions may be reconciled by reading the language in McCloskey, that the "defendant is not obligated to demonstrate actual prejudice" (457 A.2d at 337), to mean that the circumstances of that case juror intimidation coupled with private interviews with the trial judge were so egregious and inherently prejudicial as not to require a showing of actual prejudice but, instead, were presumptively prejudicial to the defendant.
Applying Hughes and McCloskey to this case, the threshold question is whether Massey is a case of egregious circumstances so inherently prejudicial as to raise a presumption of prejudice in defendant's favor. We think not. Juror drug and alcohol use during trial is not comparable to the external influences found egregious by the federal case law followed in Hughes. 490 A.2d at 1046. In those cases, the courts could more easily find a reasonable probability of resulting prejudice to the defendant. In our view, juror misconduct based on admitted self-indulgence of alcohol or drugs may not be equated with the external influences at issue in McCloskey and Hughes of perceived egregious circumstances sufficient to raise a presumption of prejudice. As we stated in Hughes, juror knowledge of a defendant's prior conviction of the very crime for which he is being tried is "so fraught with prejudice that the constitutional due process defect is not cured either by jurors' assurances that they could remain impartial or by the judge's admonition to disregard the knowledge." 490 A.2d at 1046. Juror self-indulgence in drugs does not necessarily equal intoxication and intoxication does not necessarily equal bias against the accused. Therefore, the mere introduction of some evidence of juror ingestion of alcohol or drugs is insufficient to warrant a presumption of prejudicial influence against defendant and, instead, the defendant must prove "identifiable prejudice." Id. (quoting Estes, 381 U.S. at 542, 85 S.Ct. at 1632, 14 L.Ed.2d at 550).
Our distinctive treatment of a defendant's burden in overcoming a jury verdict for juror misconduct based on juror drug and alcohol use is based, in part, on the Supreme Court's treatment of juror drug and alcohol use in Tanner v. United States, 483 U.S. ___, 107 S.Ct. 2739, 97 L.Ed.2d 90 (1987). In a five-to-four decision, the majority found that Fed.R.Evid. 606(b)[6] precluded jurors from testifying about drug and alcohol use during trial because drug or alcohol use is not an "outside influence" or "extraneous prejudicial information" about which jurors may properly testify. Id. at ___, 107 S.Ct. at 2748-50, 97 L.Ed.2d at 106-109; F.R.E. 606(b). The Court held that the District Court did not err in refusing to hold a post-verdict evidentiary hearing on the issue of juror taint based on "the inadmissibility of juror testimony and the clear insufficiency of the nonjuror evidence." Id. at ___, 107 S.Ct. at 2751, 97 L.Ed.2d at 111.
Thus, the Supreme Court in Tanner declined to find an allegation of juror taint based on juror drug and alcohol use to fall within the category of egregious circumstances deemed inherently prejudicial to the defendant. See id. at ___, 107 S.Ct. at 2750, 97 L.Ed.2d at 109 ("even if Rule 606(b) is interpreted to retain the common-law *1259 exception allowing post verdict inquiry of juror incompetence in cases of `substantial if not wholly conclusive evidence of incompetency,' Dioguardi, 492 F.2d at 80, the showing made by the petitioners falls far short of this standard").[7] Adopting Tanner's reasoning, we find that the defendant has not met his burden under Hughes and McCloskey.
Although we find controlling Delaware law on the subject, we briefly address our reasons for rejecting the "reasonable possibility" standard of Wiser. Defendant argues that the reasonable possibility standard should be adopted if we are to harmonize our rule with D.R.E. 606(b), which precludes inquiry into a juror's mental processes. He contends that the reasonable possibility standard is an objective test whereas proving actual prejudice or bias is subjective and requires the type of juror inquiry expressly prohibited by D.R.E. 606(b). The Colorado Supreme Court apparently favors its standard as a means of "avoid[ing] the problems arising under [Rule] 606(b) [by] requir[ing] the trial court to determine what effect juror misconduct would have had on a typical jury." Wiser, 732 P.2d at 1142. The relevant inquiry, according to the Colorado court, "is whether there is a `reasonable possibility' that extraneous contact or influence affected the verdict to the detriment of the defendant." Id.[8]
This Court has gone through a similar analysis regarding the difficulty, at times, of proving actual prejudice. See, e.g., Hughes, 490 A.2d at 1047. We have determined that the inherently prejudicial egregious circumstances test which raises a presumption of prejudice adequately takes care of the problem under D.R.E. 606(b) of precluding any inquiry into a juror's mental processes. The policy in this state is that unless a defendant can prove a reasonable probability of juror taint due to egregious circumstances that are inherently prejudicial, he will have to prove actual prejudice. See id.; McCloskey, 457 A.2d at 337-8; Sheeran, 526 A.2d at 896-7. But cf. Barnes v. Toppin, Del.Supr., 482 A.2d 749, 753 (1984) (evidence supporting trial court's finding that extraneous matter probably played a role in deliberations).
III
In view of the record before us and our prior case law precedent, we hold that the Trial Judge did not abuse his discretion in refusing to grant defendant's motion for a new trial based on juror misconduct. Defendant has not met his threshold burden of establishing that juror drug and alcohol use during his trial was an egregious circumstance inherently prejudicial to the verdict which would warrant a presumption of prejudice in his favor. Absent a presumption of prejudice, defendant has also failed to establish that he was actually prejudiced by juror drug and alcohol use.
* * *
Affirmed.
NOTES
[1] Defendant became aware of this alleged juror misconduct when the complaining juror, two years after defendant's trial, told the attorney who represented defendant at trial that he had used alcohol, marijuana, and methamphetamines during the three weeks of trial. The complaining juror then executed an affidavit outlining his physical and mental condition during and after trial.
[2] The State had warned the juror that should he testify according to his affidavit, he would be subject to prosecution on drug, official misconduct, and other charges. With the advice of his attorney, the complaining juror decided not to testify.
[3] The counselor did not know the complaining juror during the time of defendant's trial. He first met the juror eight months after the trial when the complaining juror's mother committed the juror to the Delaware State Hospital in January 1979. The counselor counselled the juror on an out-patient basis until November 1979, when he admitted the juror to Eugenia Hospital for in-patient drug and alcohol rehabilitation therapy.
[4] D.R.E. 606(b) provides:
RULE 606. COMPETENCY OF JUROR AS WITNESS.
* * * * * *
(b) Inquiry into Validity or Verdict or Indictment. Upon an inquiry into the validity of a verdict or indictment, a juror may not testify as to any matter or statement occurring during the course of the jury's deliberations or to the effect of anything upon his or any other juror's mind or emotions as influencing him to assent to or dissent from the verdict or indictment or concerning his mental processes in connection therewith, except that a juror may testify on the question whether extraneous prejudicial information was improperly brought to the jury's attention or whether any outside influence was improperly brought to bear upon any juror. Nor may his affidavit or evidence of any statement by him concerning a matter about which he would be precluded from testifying be received for these purposes.
[5] For a more detailed discussion of the competing policies behind McDonald v. Pless and D.R. E. 606(b), see Sheeran, 526 A.2d at 894-5.
[6] D.R.E. 606(b) is identical to Fed.R.Evid. 606(b).
[7] The Tanner decision was set in a procedural posture different from this case. The Supreme Court held that a post-verdict evidentiary hearing on the subject of juror intoxication based on juror testimony was not warranted. Our per curiam opinion in 1986 remanding this case for an evidentiary hearing preceded Tanner. See Massey v. State, Del.Supr., 514 A.2d 402 (1986). We note that today we cite to Tanner only as persuasive precedent that the Supreme Court does not deem juror intoxication during trial to be egregious conduct inherently prejudicial to the defendant. We do not comment on whether we will rely on Tanner as persuasive precedent the next time we must decide whether allegations of juror drug and alcohol use warrant an evidentiary hearing.
[8] We note that the Court in Wiser, sitting en banc, did not unanimously adopt the reasonable possibility standard. Two of the seven Justices specially concurred in the result, but argued for the adoption of a reasonable probability standard. See Wiser, 732 P.2d at 1143-44. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919188/ | 116 Pa. Commonwealth Ct. 24 (1988)
541 A.2d 827
Dithridge House Association, Petitioner
v.
Commonwealth of Pennsylvania, Department of Environmental Resources, Respondent.
No. 1402 C.D. 1987.
Commonwealth Court of Pennsylvania.
Argued March 22, 1988.
May 6, 1988.
Argued March 22, 1988, before Judges CRAIG, DOYLE and PALLADINO, sitting as a panel of three.
*25 Henry E. Rea, Jr., Brandt, Milnes & Rea, for petitioner.
Katherine S. Dunlop, Assistant Counsel, for respondent.
OPINION BY JUDGE CRAIG, May 6, 1988:
Dithridge House Association (Dithridge), the governing body of a condominium complex known as Dithridge House, appeals from a decision of the Environmental Hearing Board (board) affirming a decision of the Department of Environmental Resources (DER) which (1) rejected Dithridge's request to withdraw its application for a public bathing place permit for the condominium's swimming pool, (2) held that a permit was required, and (3) denied a permit for that pool as constructed.
The issues presented are (1) whether Dithridge should be precluded from arguing that a 1979 amendment to the Public Bathing Law, Act of June 23, 1931, P.L. 899, as amended, 35 P.S. §§672-680d, eliminates the permit requirement in regard to this pool, because of Dithridge's failure to appeal from a 1973 DER denial of a permit or a 1974 closure order issued by DER; (2) if Dithridge is not so precluded, whether DER has the *26 authority, under the Public Bathing Law as it now exists, to deny a permit to Dithridge based on the lack of a four-foot wide deck on all sides of the pool, and (3) if not, whether DER has authority under the Administrative Code of 1929 to deny this permit.
History
The facts are not in dispute. In 1971 Dithridge built a swimming pool inside its condominium complex. The contractor who built the pool applied for a public bathing place permit for it in 1973. DER denied the application because the pool does not comply with the requirement of section 2.6.8 of DER's Bathing Place Manual that "[t]here shall be provided, completely around every swimming pool, a clear unobstructed paved walk or deck not less than four feet wide, extending from the pool side edge or lip of the coping of the pool ...."[1] The contractor did not appeal that denial. On June 3, 1974, DER ordered the pool closed until a bathing place permit was obtained. Neither the contractor nor Dithridge appealed from that order.
In 1979 the legislature amended the Public Bathing Law to exclude condominium pools from the definition of "public bathing place" except with respect to certain enumerated matters. In 1985 Dithridge submitted another application to DER for a permit for this pool. Dithridge later requested permission to withdraw that application because it had received a legal opinion to the effect that the 1979 amendment exempted the pool from the permit requirement. DER denied the request to withdraw the application, based on its view that the permit requirement still applied, and it denied the application *27 because the pool still lacked a four-foot wide deck around all sides. Dithridge appealed that decision to the Environmental Hearing Board. The board granted summary judgment in favor of DER on the bases of its conclusions (1) that the provisions of the Public Bathing Law, including the permit requirement, still applied to this pool after the amendment of the law, and (2) that, "because Dithridge did not appeal DER's June 3, 1974 permit denial [meaning, apparently, the 1974 closure order, which was based on the findings of the 1973 permit denial], it is now estopped from challenging the findings set forth in that order." Dithridge has appealed from the board's decision.
Preclusion
DER contends that the doctrine of finality of administrative decisions precludes Dithridge from challenging the factual or legal basis for DER's earlier permit denial or closure order in this appeal of a subsequent permit denial, because Dithridge did not appeal from those earlier orders. The Pennsylvania Supreme Court applied this doctrine in Department of Environmental Resources v. Wheeling-Pittsburgh Steel Corp., 473 Pa. 432, 375 A.2d 320, cert. denied, 434 U.S. 969 (1977), when a steel maker sought to challenge the constitutionality of certain DER regulations relating to particulate matter emissions. The court held that, because the company did not appeal from DER's initial order directing that it comply with the regulations by a specified date, the company was "precluded from attacking the validity or content of either the order or the underlying regulations in the instant enforcement proceeding." 473 Pa. at 443, 375 A.2d at 325.
The doctrine of administrative finality focuses upon the failure of a party aggrieved by administrative action to pursue his statutory appeal remedy. This court explained *28 the rationale and policy basis for the doctrine in its decision in Department of Environmental Resources v. Wheeling-Pittsburgh Steel Corp., 22 Pa. Commonwealth Ct. 280, 284, 348 A.2d 765, 767 (1975):
We agree that an aggrieved party has no duty to appeal but disagree that upon failure to do so, the party so aggrieved preserves to some indefinite future time in some indefinite future proceedings the right to contest an unappealed order. To conclude otherwise would postpone indefinitely the vitality of administrative orders and frustrate the orderly operations of administrative law. This principle was expressed in Philadelphia v. Sam Bobman Department Store Company, 189 Pa. Superior Ct. 72, 78, 149 A.2d 518, 521 (1959), in which Judge WOODSIDE stated:
`It is settled both under common law and statute that where an act creates a right or liability or imposes a duty and prescribes a particular remedy for its enforcement such remedy is exclusive and must be strictly pursued. This means that one who fails to exhaust his statutory remedies may not thereafter raise an issue which could have and should have been raised in the proceeding afforded by his statutory remedy.
....
... This is particularly true of special statutory appeals from the action of administrative bodies.' (Emphasis added.)
In Nemacolin, Inc. v. Department of Environmental Resources, 115 Pa. Commonwealth Ct. 462, 541 A.2d 811 (1988), argued at the same time as the present case, this court held that preclusion based on administrative finality did not apply when DER instituted proceedings to close a swimming pool after an earlier unappealed *29 permit denial, because the later proceeding was an enforcement of a general obligation to operate with a permit if one were required by law, not an enforcement of any particular obligation arising out of the permit denial. Because the pool owner there was not aggrieved by the permit denial, that is, not burdened or placed under any new obligation, the duty to appeal or to forego any later challenge to the factual or legal basis of the permit denial was not triggered.
In the present case, however, DER denied a permit application for the pool in 1973 and then issued a closure order in 1974. Under our analysis in Nemacolin, Dithridge's failure to appeal from the closure order, which did impose an immediate, affirmative obligation on Dithridge, should now preclude it from challenging the factual or legal basis for that order, unless some exception applies.
Dithridge responds to DER's preclusion argument by contending that an exception to the doctrine of issue preclusion, relating to an intervening change in the legal context, applies in this case as well.
The Act of July 12, 1979, P.L. 93, amended section 2(1) of the Public Bathing Law, 35 P.S. §673(1), by adding the following language:
Except with respect to the regulation of water supply and content, hygiene and plumbing and electrical facilities, and safety equipment, a public bathing place shall not include a swimming pool owned and operated for the exclusive use and enjoyment of residents of a concominium or cooperative or their personal guests. (Emphasis added.)[[2]]
*30 In Nemacolin we construed this change in definition to mean that condominium pools, although subject to regulation by DER with regard to the enumerated matters, are no longer subject to the permit requirement of section 5 of the Public Bathing Law, 35 P.S. §676.
Therefore, Dithridge points to the case of Clark v. Troutman, 509 Pa. 336, 502 A.2d 137 (1985), where the Supreme Court considered a situation involving an act passed by the legislature raising the salaries of elected officials of some counties, when permitted by the constitution. Certain county officials brought an action in mandamus to compel payment of the increases, and their county government defended on the basis that payments to these officials, who were already in office when the act took effect, would violate the constitutional ban on increases in the salaries of elected officials during their terms of office. The common pleas court held that the payments were constitutional and ordered that they be made. The county did not appeal. Some seven months later, after the Supreme Court held in another case that such payments were unconstitutional, the county government stopped paying the increases. The affected officials obtained a writ of execution for payment of the increases, and the county government sought to open the judgment. This court held on appeal that the officials' entitlement to the increases was res judicata, by virtue of the unappealed original decision.
The Supreme Court viewed the problem as one of issue preclusion.[3] The court explained the nature and function of issue preclusion as follows:
[Issue preclusion] is the common law rule that a final judgment forecloses relitigation in a later *31 action involving at least one of the original parties, of an issue of fact or law which was actually litigated and which was necessary to the original judgment.... The purposes of the rule are the protection of litigants from the dual burden of relitigating an issue with the same party or his privy and the promotion of judicial economy through prevention of needless litigation.
Troutman, 509 Pa. at 340, 502 A.2d at 139 (citation omitted).
The Supreme Court reversed, holding that inequitable administration of the laws would result from paying the increased rates to these officials while denying them to all others similarly situated. In its opinion the court quoted extensively from the Restatement (Second) of Judgments (1982), §28, and the commentary thereto, which state in part as follows:
Although an issue is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, relitigation of the issue in a subsequent action between the parties is not precluded in the following circumstances:
....
(2) The issue is one of law and ... (b) a new determination is warranted in order to take account of an intervening change in the applicable legal context or to otherwise avoid inequitable administration of the laws.
....
[Comment]
c. Change in applicable legal context; avoidance of inequitable administration of the laws. Even when claims in two actions are closely related, an intervening change in the relevant *32 legal climate may warrant reexamination of the rule of law applicable as between the parties....
....
In deciding whether to apply issue preclusion, or instead to apply a subsequent emerging legal standard, the choice is between two forms of disparity in resolution of legal controversy.... [I]t can be particularly significant that one of the parties is a government agency responsible for continuing administration of a body of law that affects members of the public generally, as in the case of tax law. Refusal of preclusion is ordinarily justified if the effect of applying preclusion is to give one person a favored position in current administration of a law. (Emphasis added.)
We note that the principle of issue preclusion would not preclude Dithridge from arguing the effect of the 1979 amendment to the Public Bathing Law in its current permit application, because that issue obviously could not have been litigated in 1973. Similarly, because Dithridge's present claim of valid legal status under the current state of the law is different from its claim in 1973 to be entitled to a permit under the former state of the law, res judicata also would not apply here.
By the 1979 amendment quoted above, there has been an intervening change in the legal context that undeniably would result in inequitable administration of the laws if Dithridge were precluded, on the basis of administrative finality, from arguing that the permit requirement of section 5 of the Public Bathing Law no longer applies to it. If Dithridge were precluded now from arguing that the permit requirement no longer applies to its pool, then Dithridge would remain subject *33 to the permit requirement (and subject to the 1974 closure order for lack of a permit) while other similarly situated condominium pool operators, by virtue of the amendment, would not be. Circumstances involving an intervening change in the law, which would result in inequitable administration of the law if preclusion were applied, also create an exception to preclusion based on the doctrine of finality of administrative decisions. In the present case the policy of equitable administration of the laws overrides the policy served by the doctrine of administrative finality; Dithridge is not precluded from arguing here that the permit requirement does not apply to it.
Merits
As stated above in the discussion of the preclusion issue, our decision in Nemacolin resolves in Dithridge's favor the issue of whether the permit requirement of section 5 of the Public Bathing Law applies to condominium pools.
The Nemacolin case also offers guidance on the second issue relating to the merits of this case whether the absence of a deck around all sides of the pool in question here falls within DER's continued power to regulate "safety equipment" at condominium pools. In Nemacolin we held that the term "safety equipment" does not extend to every conceivable aspect of a pool touching on safety; in particular, the term "equipment" cannot encompass the design of the structure of the pool. We noted that the word "equipment" generally is defined in terms of items of personalty rather than of realty. The presence or absence of a deck around all sides of a pool relates to the design of the structure of the pool, and not to "safety equipment" used in the operation of the pool. Therefore, the absence of a deck is not a matter within the power of DER to regulate under *34 the amended version of section 2(1), and DER may not deny Dithridge a permit on this basis.
Finally, DER repeats in capsule form its argument, also raised in Nemacolin, that it has the authority to deny this permit application, apart from the provisions of the Public Bathing Law, by virtue of its power under §1917-A of the Administrative Code of 1929, Act of April 9, 1929, P.L. 177, as amended, 71 P.S. §510-17, to protect the people of the Commonwealth from unsanitary conditions and other nuisances. However, we held in Nemacolin that DER's authority to abate nuisances at swimming pools under §1917-A extends no further than its authority to regulate public bathing places under the Public Bathing Law. Therefore, §1917-A of the Administrative Code of 1929 does not provide an independent basis for DER to deny Dithridge's permit application.
Conclusion
The Environmental Hearing Board's summary affirmance of DER's denial of Dithridge's 1985 permit application, based on the board's conclusions that the provisions of the Public Bathing Law apply to Dithridge's pool and that Dithridge was precluded from arguing otherwise, was error. The permit requirement of section 5 of the Public Bathing Law does not apply to the pool operated by Dithridge. In addition, the absence of a deck around all sides of this pool is not a matter within DER's prohibitory powers under the amended version of section 2(1) of the Law (although DER, under its regulatory powers, could require, with respect to any such condition, a condominium pool to provide warning signs, lifesaving gear or other safety equipment items).
Accordingly, we reverse the board's decision, so as to allow withdrawal of the permit application, in that no permit is required with respect to this condominium pool.
*35 ORDER
NOW, May 6, 1988, the order of the Environmental Hearing Board, at EHB Docket No. 86-550-R, dated June 17, 1987, is reversed. Dithridge House Association shall be granted leave to withdraw its application to the Department of Environmental Resources for a public bathing place permit for the swimming pool located at Dithridge House.
NOTES
[1] 25 Pa. Code §193.14 provides: "The Department's pamphlet, `Bathing Place Manual,' Bureau of Sanitary Engineering Publication No. 16, may be used as a guide for determining compliance with the provisions of §§193.11-193.17 of this Title (relating to permits)."
[2] In 1984 the amendment to section 2(1) was itself amended to encompass lakes and ponds as well as swimming pools and members of property owners' associations as well as residents of condominiums and cooperatives. Act of July 9, 1984, P.L. 662. Those later changes are not involved in this case.
[3] Although the issue of the officials' right to be paid at the higher rate was identical in both actions, the officials' claim for payments themselves related to later pay periods in the second action and so was not identical to the claim in the first action. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919204/ | 373 Pa. Superior Ct. 377 (1988)
541 A.2d 365
Quadralane NIVENS, on Behalf of John NIVENS, a Minor
v.
CHESTNUT HILL HOSPITAL, Appellant.
Supreme Court of Pennsylvania.
Argued December 2, 1987.
Filed April 8, 1988.
*378 Allan Molotsky, Philadelphia, for appellant.
Donald E. Matusow, Philadelphia, for appellee.
Before CIRILLO, President Judge, and BROSKY and BECK, JJ.
BROSKY, Judge:
This is an appeal from the order of June 5, 1987, entered on June 10, 1987, which vacated a judgment of non pros which had previously been entered in appellant's favor on April 2, 1987. Appellant now contends that the vacation of non pros was error. We do not support this view. For reasons stated infra, we affirm.
The matter arises from a medical malpractice suit which was filed by appellee, Quadralane Nivens, on behalf of her minor son, John Nivens, against appellant, Chestnut Hill Hospital, in May of 1983. After four (4) years of pre-trial *379 discovery, the case made its first appearance on the major jury trial list in the March 17, 1987 edition of Philadelphia's Legal Intelligencer. The case moved into the top ten (10) on March 27, 1987, and was called for trial. Neither counsel for appellant, nor counsel for appellee, was present at the call of the list, and, in accordance with Pa.R.C.P. 218, a judgment of non pros was entered against appellee Nivens and in favor of the appellant-hospital on the court's own motion. Appellee's counsel received notice of the entry of non pros on April 1, 1987, and promptly filed, on April 8, a motion to vacate the judgment of non pros. Appellant responded, and, on June 5, 1987, the trial court vacated non pros, and directed that the case be relisted for trial. This timely appeal followed.
A petition to open a judgment of non pros is addressed to the court's equitable power, and the exercise of those powers will not be disturbed absent an abuse of discretion. Hutchison v. Hutchison, 492 Pa. 118, 123, 422 A.2d 501, 503-04 (1980). However, before a court may open a judgment, the party seeking vacation must demonstrate that: (1) the petition to open was timely filed; (2) the default which occasioned the entry of judgment can be reasonably explained; and (3) the facts constituting grounds for a cause of action are alleged. Toczylowski v. General Bindery Co., 359 Pa.Super. 572, 577, 519 A.2d 500, 503 (1986); Horan v. R.S. Cook and Associates, Inc., 287 Pa.Super. 265, 268, 430 A.2d 278, 279 (1981); Corcoran v. Fiorentino, 277 Pa.Super. 256, 260, 419 A.2d 759, 761 (1980); Dupree v. Lee, 241 Pa.Super. 259, 262, 361 A.2d 331, 333 (1976).
With regard to the initial criterion, the timeliness with which vacation is attempted, there is no dispute between the parties that the motion to vacate was filed expeditiously. It is the second and third criteria that appellant maintains were not satisfied.
With respect to the second criterion, the trial court found a reasonable excuse for the failure of appellee's counsel to appear at the call of the list, and based its finding upon the *380 following "Notice to the Bar", which has appeared in some form or other in the Legal Intelligencer since January 2, 1987:[1]
. . . [I]f counsel has failed to communicate with opposing counsel . . . when the case first appeared on the list, and only one counsel appears at the call of the list;
(a) if the counsel ready to proceed to trial represents the plaintiff, the case will not proceed to trial;
(b) if the counsel ready to proceed represents the defendant, plaintiff's case will not be dismissed.
Conversely, if the party appearing has given notice to the opposing party, the case will proceed in the absence of the opposing party. (If you believe that the opposing party will deny receiving such notice, a certified letter or receipt of notice may be advisable.)" (Emphasis supplied.)
The trial court focused upon the failure of appellant's counsel to contact his opposition, as required by the above notice, to confirm the case's status, and, citing our Court's decision in Toczylowski, supra, made the following observations:
. . . the Court recognizes defendant's contention that plaintiff has an obligation to learn how and when cases are assigned to trial. It is incumbent upon a Philadelphia practitioner to be familiar with The Legal Intelligencer and its contents, particularly those sections which govern the practice of litigation in the Philadelphia Courts. Toczylowski v. General Bindery Company, et al., 359 Pa. Super. 572, 519 A.2d 500 (1986). . . .
*381 On the other hand, this Court's policy of confirming a case's status "represents a proper, dignified and courteous procedure consistent with the standards which are appropriate for the legal profession," Cleary v. Paul, 15 Phila. 546, to which the majority of attorneys adhere. Id. at 545. Some attorneys view a failure to appear in court as an opportunity to benefit from a judgment of non pros. This Court believes that the failure to communicate with opposing counsel to confirm the status of the case represents a derelict act which is no less serious than the failure to adequately monitor the published trial list. For this reason, the defendant should not benefit from a non pros so entered . . . ." (Emphasis supplied.)
The trial court thus concluded that the absence of appellee's counsel from the call was reasonably excused by his failure to receive prior notice from appellant's counsel. Appellant now contends that the trial court's reading of Toczylowski is flawed, and is requesting, in essence, a clarification of Toczylowski in light of the new Philadelphia notice policy: it is appellant's position that the failure of its counsel to give the required prior notice to opposing counsel should be immaterial, in light of Toczylowski's clear dictates that all Philadelphia trial practitioners must monitor the trial lists in the Intelligencer, and that the failure of appellee's counsel to appear, hence, was unreasonable per se. We decline, however, to resolve this precise issue, as we find Toczylowski factually distinguishable, thereby obviating any need for a reconciliation, at this time, of Philadelphia's new policy with that decision.
In Toczylowski, counsel for appellee had not appeared at the call of the list, due to her failure to monitor the major jury trial listings in the Intelligencer. Appellant's counsel had been present, however, and had requested the entry of non pros. Toczylowski, supra, 359 Pa.Superior Ct. at 576-577, 519 A.2d at 502.
In the matter sub judice, by contrast, appellant's counsel did not request the non pros, but, rather, due to his own failure to monitor the daily trial list, also missed the *382 listing of this case, and failed to appear when the case was called for trial. Non pros was entered upon the court's own motion, and not as the result of diligent representation by appellant's counsel. Hence, we are confronted with a situation wherein appellant is insisting that Toczylowski be strictly enforced against its opponent, while ignoring the negligent non-compliance of its own counsel with that decision's requirements.
A petition to vacate a judgment of non pros is addressed to a trial court's equitable powers; where the trial court has vacated non pros, an appellate court will not reverse unless a manifest abuse of discretion, or clear error of law, in its consideration of the three criteria for vacation, has occurred. See Geyer v. Steinbronn, 351 Pa.Super. 536, 506 A.2d 901 (1986); see also Buxbaum v. Peguero, 335 Pa.Super. 289, 293, 484 A.2d 137, 139 (1984). Moreover, we may affirm the trial court if its decision was correct on any ground. Butler v. DeLuca, 329 Pa.Super. 383, 389, 478 A.2d 840, 843 (1984). We now hold, without relying upon the reason given by the trial court, i.e. the failure of appellant's counsel to follow the new Philadelphia notice policy, that, where a party acts promptly to vacate a non pros which has been entered on the court's own motion, due to the failure of both sides to appear, the trial court may, as an equitable matter, hold that the moving party's failure to strictly conform to the Toczylowski requirements for diligent representation, in the face of an innocent oversight, is reasonably excused where the opposing party has displayed a similar lack of due diligence by failing to monitor the list and appear at the same call.[2] Where neither party is prepared to go forward, as here, neither should be permitted to profit from an innocent, albeit negligent, comedy of errors.[3] It has been established law in this Commonwealth *383 that an innocent oversight by counsel may justify the vacation of non pros.[4] See Buxbaum, supra, 335 Pa.Superior Ct. at 295, 484 A.2d at 140.
Moving, then, to the third criterion, appellant contends that appellee's motion to vacate failed to provide facts constituting grounds for a cause of action. The trial court opinion contains no discussion of the third criterion. However, our review of appellee's motion indicates that the cause of action is a medical malpractice case, in which it is alleged that minor-plaintiff John Nivens suffered brain damage due to trauma to which he was negligently subjected at birth, at the hands of the defendant-hospital.
Appellant does not assert that such facts, if true, would not provide the basis for a cause of action, but contends that appellee's failure to date to either identify any expert, or detail the theory of any expert, precludes any finding that the third criterion for vacation has been met, as appellee's *384 case would have been non-suited had trial proceeded. While we do not deny that appellant might eventually be awarded a non-suit, we find no case support for the proposition that a moving party cannot satisfy the third criterion for vacation in the absence of proof that he would have been able to successfully oppose a motion for non-suit had trial proceeded; the law would only appear to require allegations of fact that facially state a cause of action. We find appellant's allegations to be sufficient on their face to support the vacation of non pros.
Order affirmed.
NOTES
[1] On December 29, 1986, the decision in Toczylowski v. General Bindery Co., 359 Pa.Super. 572, 519 A.2d 500 (1986), was handed down by a panel of this Court. The case focused upon the criteria for vacation of non pros, and, with respect to the second criterion of "reasonable excuse", held that the failure of trial counsel to monitor the daily trial lists published in the Intelligencer, did not constitute a "reasonable excuse" for counsel's failure to appear at the call of the list. In an apparent response to Toczylowski, the above "Notice to the Bar" now precludes an attorney from taking advantage of his opponent's absence from the call of the list, in the absence of proof that opposing counsel was notified by the appearing attorney whenever the case first appeared on the Intelligencer's trial list.
[2] This, of course, is conditioned upon the moving party's ability to allege facts constituting a cause of action, and thereby satisfy the third criterion for vacation of non pros.
[3] We would also note in passing that the result urged upon us by appellant would contravene the apparent intent behind the new Philadelphia notice policy. Under appellant's proposed application of Toczylowski, defense counsel, aware of the presence of a case on the trial list, could neglect to notify opposing counsel, appear at the call of the list, and, upon the non-appearance of plaintiff's counsel, sit silently as the case is called, refusing to admit to his own presence. Under this scenario, the court would enter a non pros on its own motion, and defense counsel would have obtained a non pros in the absence of notice to plaintiff's counsel, in violation of the new policy.
Of course, as we are deciding the matter before us on narrow grounds, i.e. the failure of both sides to appear as precluding application of Toczylowski against appellee, we are not resolving whether the new Philadelphia policy unduly restricts the ability to obtain a non pros pursuant to Rule 218. We would have been presented with that issue had appellant's counsel appeared at the call of the list, and requested the entry of non pros despite his failure to notify opposing counsel. However, a prior notice policy has been a requirement of practice in other counties of this Commonwealth. Cf. Rynkiewicz v. McGrath, 42 Pa.D & C 396 (Schuylkill Cty. 1941) (citing Schuylkill County Local Rule of Court 220.) Clearly, the conditioning of Rule 218 by a prior notice requirement is an issue that must be decided when the appropriate factual scenario presents itself.
[4] This statement of law might appear contrary to the holding in Toczylowski. However, it must be remembered that, in Toczylowski, plaintiff's counsel: (1) did not move promptly for vacation of non pros, and (2) had received a letter indicating that her case was being considered for an individual judge assignment, thereby putting counsel on notice that the case was deemed ready for trial and might imminently appear on the trial list, rendering her claim of "innocent oversight" less than credible. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588725/ | 14 So.3d 278 (2009)
MORTELLARO & SINADINOS, PLLC, Appellant,
v.
COUNTRYWIDE HOME LOANS, Servicing LP Countrywide Home Loans, Servicing LP, James Tucker; Gail A. Tucker; Unknown Tenant # 1; Unknown Tenant #2; Consolidated City of Jacksonville a Municipal Corporation of the State of Florida; Michael Smith, and any unknown heirs, devisees, grantees, creditors and other unknown persons or unknown spouses claiming by, through and under any of the above-named Defendants, Appellees.
No. 1D09-0239.
District Court of Appeal of Florida, First District.
July 31, 2009.
Gina M. Sinadinos and Michelangelo Mortellaro, Mortellaro & Sinadinos, PLLC, Tampa, pro se, Appellant.
Thomas M. Beverly, Assistant General Counsel, Jacksonville; Kimberly A. Humphrey, Butler & Hosch, P.A., Orlando; Stephen J. Berlinsky, The Elkin Law Firm, P.A., Clermont, for Appellees.
PER CURIAM.
The appellant seeks review of two orders entered by the lower court in a post-judgment proceeding in a mortgage foreclosure case. The first of these is an order entered on November 18, 2008, vacating and setting aside a previous order directing the clerk of the court to distribute surplus funds. The second is an order entered on December 12, 2008, denying a motion for rehearing, or in the alternative *279 an order denying a motion for relief from the November 18th order. This court lacks jurisdiction to review either order.
The notice of appeal is untimely as to the November 18th order vacating the prior order directing the clerk to distribute the surplus funds, because it was filed more than thirty days from the date of rendition of the order. See Fla. R. App. P. 9.110(b). Rendition can be suspended by an "authorized motion." Fla. R. App. P. 9.020(h). A motion for rehearing is an authorized motion only when it is directed to a previous final order. Because the November 18th order was not a final order, the subsequent motion for rehearing was not an authorized motion and it did not have the effect of suspending the jurisdictional time limit for taking an appeal. See Wagner v. Bieley, Wagner Assocs., Inc., 263 So.2d 1 (Fla.1972).
Nor does the court have jurisdiction to review the December 12, 2008 order styled as an "Order Denying Motion for Rehearing, Reconsideration, and/or Clarification or, in the Alternative, Motion for Relief from the November 18, 2008 Order." An order on a motion for rehearing is not appealable in its own right. See Grant v. Jones, 933 So.2d 32 (Fla. 1st DCA 2006); Cole v. State, 905 So.2d 905 (Fla. 1st DCA 2005). An authorized and timely motion for rehearing merely suspends the date of rendition of the order to which it was directed; it does not set in motion another controversy that will become the subject of a separate appeal.
The appellant argues that because its motion also sought to set aside the lower court's November 18, 2008 order under Florida Rule of Civil Procedure 1.540(b), the order denying that motion is appealable pursuant to Florida Rule of Appellate Procedure 9.130(a)(5). This would be a valid argument if the motion to vacate had been directed to a previous final order. See Bennett's Leasing, Inc. v. First Street Mortgage Corp., 870 So.2d 93, 98 (Fla. 1st DCA 2003). But in this case, the appellant sought to vacate a post-judgment order that could only be characterized as a nonfinal order in the post-judgment proceeding. The November 18, 2008 order vacated a prior order directing the clerk to distribute the surplus funds. This order did not finally adjudicate the rights of any party to the surplus funds. To the contrary, it had the effect of re-opening the post-judgment proceeding. When that proceeding is completed in the trial court any party aggrieved by the trial courts final decision may file an appeal. All we have at present is an order denying a previous nonfinal order in a post-judgment proceeding that is not yet concluded. Because the December 12, 2008 order denied a motion to vacate a previous nonfinal order, it does not qualify as an order under rule 1.540 and it is not appealable under rule 9.130(a)(5).
Dismissed.
PADOVANO, BROWNING, and THOMAS, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1018446/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 05-4020
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
ANTHONY D. DAVIS,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Gerald Bruce Lee, District
Judge. (CR-04-98)
Submitted: January 11, 2006 Decided: February 8, 2006
Before WILKINSON, MOTZ, and KING, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Bruce A. Johnson, Jr., BRUCE A. JOHNSON, JR., L.L.C., Bowie,
Maryland, for Appellant. Paul J. McNulty, United States Attorney,
John Eisinger, Assistant United States Attorney, Alexandria,
Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Anthony D. Davis was found guilty at the conclusion of a
bench trial of thirteen counts of a second superceding indictment
charging him in Count One conspiracy to transport, possess, and
sell stolen motor vehicles, in violation of 18 U.S.C. § 371; Counts
Two through Five interstate transportation of stolen motor
vehicles, in violation of 18 U.S.C. § 2312; Counts Six through Nine
possess, conceal, and sell stolen motor vehicles, in violation of
18 U.S.C. § 2313, Counts Ten through Thirteen interstate
transportation of fraudulent motor vehicle titles, in violation of
18 U.S.C. § 2314. The district court sentenced Davis to fifty-
seven months’ imprisonment on each of the thirteen counts, to be
served concurrently with one another, three years of supervised
release, and ordered payment of restitution of $53,911.45 and
payment of a $1300 special assessment. Davis asserts on appeal
that: (1) the district court erred in calculating total loss; (2)
the evidence was not sufficient to support the district court’s
findings beyond a reasonable doubt that Davis was in the business
of receiving and selling stolen property, that the offense involved
sophisticated means, and that the offense involved the organized
scheme to steal vehicles; (3) the district court erred in allowing
the Government to use Davis’ pretrial statements in its case-in-
chief; and (4) his sentence is invalid in light of United States v.
Booker, 543 U.S. 220 (2005). Davis also has filed a motion to
- 2 -
remand for resentencing, citing Booker. For the reasons that
follow, we deny Davis’ motion for remand and affirm his conviction
and sentence.
Davis’ first contention, that the district court erred in
calculating total loss relative to the stolen vehicles, is without
merit because the district court properly made a reasonable
estimate of loss based on the fair market value of the stolen
vehicles, as reflected by the amounts paid out by the respective
insurance companies to the victims of the crimes. See U.S.
Sentencing Guidelines Manual § 2B1.1(b)(1), comments. (n.3(C),
3(C)(I)) (2004). In declining Davis’ invitation to credit him for
the proceeds obtained when those vehicles ultimately were auctioned
off after their retrieval following his arrest, the district court
did not err. Hence, the district court’s conclusion that the loss
was greater than $70,000 was reasonable and Davis’ guideline range
properly was calculated on that basis.
Davis next asserts that the evidence was insufficient to
support the district court’s determinations, beyond a reasonable
doubt, that Davis was in the business of receiving and selling
stolen property and that the offense involved sophisticated means,
as well as its ultimate four-level enhancement of Davis’ offense
level based on those determinations.* Because Davis failed to
*
He also asserts error in the district court’s finding beyond
a reasonable doubt that the offense involved the organized scheme
to steal vehicles.
- 3 -
raise the sufficiency of the evidence issue in the district court,
we review the claim for plain error. United States v. Olano, 507
U.S. 725, 732 (1993); United States v. Higgs, 353 F.3d 281, 324
(4th Cir. 2003).
A defendant challenging the sufficiency of the evidence
faces a heavy burden. See United States v. Beidler, 110 F.3d 1064,
1067 (4th Cir. 1997). In reviewing a sufficiency challenge, “[t]he
verdict of [the factfinder] must be sustained if there is
substantial evidence, taking the view most favorable to the
Government, to support it.” Glasser v. United States, 315 U.S. 60,
80 (1942). This court “ha[s] defined ‘substantial evidence,’ in
the context of a criminal action, as that evidence which ‘a
reasonable finder of fact could accept as adequate and sufficient
to support a conclusion of a defendant’s guilt beyond a reasonable
doubt.’” United States v. Newsome, 322 F.3d 328, 333 (4th Cir.
2003) (quoting United States v. Burgos, 94 F.3d 849, 862 (4th Cir.
1996)).
We find there was substantial evidence, when viewed in
the light most favorable to the Government, to support the district
court’s verdict and findings, which evidence included testimony
from those who purchased the stolen vehicles from Davis, the
victims whose vehicles were stolen, and an agent who interviewed
Davis following his arrest, as well as documentary and other
evidence demonstrating Davis’ use of fraudulent and fictitious
- 4 -
identification and documentation relating to the vehicles, and the
interstate transportation of those vehicles and documents.
Accordingly, we find no error in the district court’s findings,
beyond a reasonable doubt, with respect to the sentencing
allegations included in the indictment, that Davis was in the
business of receiving and selling stolen property, that the offense
involved sophisticated means as it relates to the fake Vehicle
Identification Numbers and title documents, and that the scheme was
an organized scheme to sell stolen vehicles.
Davis next challenges the district court’s decision to
allow the Government to use Davis’ pretrial statements made to law
enforcement officers as part of a plea agreement into which he
ultimately did not enter. Specifically, he contends that he did
not knowingly and voluntarily waive his right to allow the
Government to introduce the statements he made during his plea
negotiations, because he did not follow through with his guilty
plea.
A district court's decision to allow the introduction of
evidence is entitled to substantial deference and will not be
reversed by this court absent a clear abuse of discretion. Sasaki
v. Class, 92 F.3d 232, 241 (4th Cir. 1996). Case-by-case inquiries
are appropriate to determine whether waiver agreements are the
product of fraud or coercion, and absent some affirmative
indication that the plea statement waiver was entered into
- 5 -
unknowingly or involuntarily, the agreement to waive the
exclusionary provision of the plea-statement Rules is valid and
enforceable. United States v. Mezzanatto, 513 U.S. 196, 210
(1995).
Here, the parties stipulated that the following provision
appeared in paragraph 15 of Davis’ plea agreement, which was signed
by Davis, his attorney, and the Government attorney:
This agreement is effective when signed by the defendant,
the defendant’s attorney, and an attorney for the United
States. The defendant agrees to entry of this plea
agreement at the date and time scheduled with the Court
by the United States . . . If the defendant withdraws
from this agreement . . . violates any provision of this
agreement, then:
(c) Any prosecution that is the subject of this
agreement, may be premised on any information provided,
or statements made, by the defendant, and all such
information, statements, and leads derived therefrom may
be used against the defendant. The defendant waives any
right to claim that statements made before or after the
date of this agreement, including the statement of facts
accompanying this agreement or adopted by the defendant
and any other statements made pursuant to this or any
other agreement with the United States, should be
excluded or suppressed under Fed. R. Evid. 410, Fed. R.
Crim. P. 11(f), the Sentencing Guidelines or any other
provision of the Constitution or federal law.
(Emphasis added; citations omitted).
We find that, pursuant to the explicit terms of the
agreement, the waiver agreement became effective upon the
signatures of the parties and was not contingent on Davis’ ultimate
acceptance of the plea arrangement. Davis clearly waived any right
to claim that his statements made during plea negotiations were not
- 6 -
admissible at trial, and his assertion that his waiver is
ineffective merely because he did not ultimately follow through
with his plea is without merit. Davis has not shown that the
district court’s ruling on the admissibility of his statements made
during plea negotiations was clearly erroneous.
Davis contends that the district court clearly erred in
sentencing him under a mandatory guidelines regime, in violation of
the rule announced in Booker. This contention, raised in his
briefs on appeal, also forms the basis for his pending motion to
remand for resentencing. As stipulated to by the parties, we
review for plain error any sentencing issues raised pursuant to
Booker. See United States v. Hughes, 401 F.3d 540, 546-60 (4th
Cir. 2005); United States v. White, 405 F.3d 208, 215 (4th Cir.
2005).
This court will find plain error in the district court’s
imposition of a sentence under the former mandatory guidelines
regime, even in the absence of a Sixth Amendment violation, only
where the defendant “demonstrate[s], based on the record, that the
treatment of the guidelines as mandatory caused the district court
to impose a longer sentence than it otherwise would have imposed.”
White, 405 F.3d at 224. Here, while the district court sentenced
Davis at the bottom of the sentencing range, it made no comment
regarding the mandatory nature of the guidelines, nor did it make
any comments in sentencing Davis that would indicate that it would
- 7 -
have imposed a different sentence under an advisory guideline
system. Therefore, as the record does not reveal a nonspeculative
basis for concluding that the district court would have imposed a
shorter sentence had it known it possessed discretion to do so, we
find that Davis cannot demonstrate that the district court’s error
in sentencing him under a mandatory guidelines regime affected his
substantial rights such that he is entitled to resentencing. See
United States v. Olano, 507 U.S. 725, 734-35 (1993).
Accordingly, we deny Davis’ motion to remand for
resentencing, and affirm his conviction and sentence. 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
- 8 - | 01-03-2023 | 07-04-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588737/ | 85 S.W.3d 429 (2002)
LOT 39, SECTION C, NORTHERN HILLS SUBDIVISION, GRAYSON COUNTY, TEXAS, Appellant,
v.
STATE of Texas, Appellee.
No. 11-01-00244-CV.
Court of Appeals of Texas, Eastland.
August 22, 2002.
*430 David Stagner, Stagner & Corley, Sherman, for appellant.
Joseph D. Brown, Grayson County Atty., Cary McDougal, Cooper & Scully, Sherman, for appellee.
Panel consists of: ARNOT, C.J., and WRIGHT, J., and McCALL, J.
Opinion
JIM R. WRIGHT, Justice.
The issue in this case is whether a homestead is protected from forfeiture in a proceeding brought by the State pursuant to TEX. CODE CRIM. PRO. ANN. art. 59.01 et seq. (Vernon Pamph. Supp. 2002) (hereinafter referred to as Chapter 59). The State sought the forfeiture of Lot 39, Section C, Northern Hills Subdivision, Grayson County, Texas. This property was Daniel Helm's homestead, and Helm asserted that it was exempt from forfeiture pursuant to TEX. CONST. art. XVI, § 50 and TEX. PROP. CODE ANN. § 41.001 (Vernon Supp. 2002). The trial court rejected Helm's contentions and ordered that his homestead be forfeited. In his sole issue on appeal, Helm argues that the homestead exemption precludes the forfeiture of his residence. We affirm.
The parties stipulated that Helm possessed methamphetamine at his house on two different occasions when search warrants were executed. Items used in the manufacture of methamphetamine were seized from within the residence, the shed, and the nearby field. These items included an Herlich Meyer flask, a substantial quantity of purified pseudoephedrine, denatured alcohol, acetone, about 27 empty pseudoephedrine bottles, a gallon sprayer, coffee filters that had been used to extract the pseudoephedrine, a set of triple beam scales, and a set of digital scales. Also seized were $1,535 in cash, several firearms and holsters, and a bulletproof vest. The evidence indicated that the extraction of the pseudoephedrine had occurred inside the residence.
Pursuant to Articles 59.01(2) and 59.02, "contraband" that is subject to forfeiture includes real property that is used or intended to be used in the commission of a felony under the Texas Controlled Substances Act. The evidence indicated that Helm's homestead was being used in such a manner.
The Texas constitutional provision declaring the exemption for homesteads is Article XVI, section 50, which provides:
The homestead of a family, or of a single adult person, shall be, and is hereby protected from forced sale, for the payment of all debts. (Emphasis added)
*431 The statutory provision, Section 41.001, similarly provides that a homestead is "exempt from seizure for the claims of creditors." (Emphasis added) The enumerated exceptions to these provisions are not applicable to the issue in this case but, rather, provide exceptions for debts such as purchase money and property taxes.
Although the issue in this case appears to be one of first impression in Texas, there are a few published opinions from Texas courts that indicate a homestead was forfeited pursuant to Chapter 59 because of drug-related activity. See Romero v. State, 927 S.W.2d 632 (Tex.1996); Bochas v. State, 951 S.W.2d 64 (Tex.App.-Corpus Christi 1997, writ den'd); State v. One (1) Residence Located at 1204 North 12th Street, Alamo, Texas, 907 S.W.2d 644 (Tex.App.-Corpus Christi 1995, no writ); Ex parte Camara, 893 S.W.2d 553 (Tex. App.-Corpus Christi 1994, pet'n ref'd). None of these cases, however, dealt with the homestead exemption. Nonetheless, there is one Texas case in which the court addressed the homestead exemption and held that it did not protect a homestead from public nuisance laws. 1018-3rd St. v. State, 331 S.W.2d 450 (Tex.Civ.App.-Amarillo 1959, no writ). In 1018-3rd St., the court upheld the closing and padlocking of a house for a period of one year upon the finding that the house, which was the defendant's homestead, had been used in violation of the Texas liquor laws.
The parties in this case rely on caselaw from other states. The issue has been addressed in other states with similar homestead exemptions, and the outcomes are varied. Courts in Florida, Illinois, Iowa, Kansas, and Oklahoma have held that homesteads are protected from seizures and forfeitures based upon the occurrence of criminal offenses. Tramel v. Stewart, 697 So.2d 821 (Fla.1997); Butterworth v. Caggiano, 605 So.2d 56 (Fla.1992); People v. One Residence Located at 1403 East Parham Street, 251 Ill.App.3d 198, 190 Ill.Dec. 573, 621 N.E.2d 1026 (1993); In re Bly, 456 N.W.2d 195 (Iowa 1990); State, ex rel. Braun v. Tract of Land in Northwest Quarter of Section Four, Township Eleven South, Range Nineteen West of the 6th P.M., Ellis County, 251 Kan. 685, 840 P.2d 453 (1992); State ex rel. Means v. Ten (10) Acres of Land, 877 P.2d 597 (Okla.1994). Courts in Arizona, Colorado, and Washington have held that their respective homestead exemption applies to protect homesteads from forced sales arising from the owner's debts but does not apply to protect homesteads from forfeitures brought about by the owner's use of the property to conduct criminal activity. See In re Parcel of Real Property known as 1632 N. Santa Rita, Tucson, 166 Ariz. 197, 801 P.2d 432 (Ct.App.1990, review den'd); People v. Allen, 767 P.2d 798 (Colo.Ct.App.1988); Tellevik v. Real Property Known as 6717 100th Street S.W., Located in Pierce County, 83 Wash.App. 366, 921 P.2d 1088 (1996), review den'd, 133 Wash.2d 1029, 950 P.2d 476 (1998).
We find the reasoning of the courts in Arizona, Colorado, and Washington to be persuasive. We note that Helm's reliance on the cases from Florida, Illinois, Iowa, and Kansas is misplaced because the homestead provisions in those states contain broader exemption language than the Texas provisions and are, therefore, distinguishable. In Florida, homesteads are exempt from forced sale under process of any court. In Illinois, homesteads are exempt from attachment or judgment for the payment of debts or other purposes. In Iowa, homesteads are exempt from judicial sale unless there is a special statutory declaration to the contrary. In Kansas, homesteads are exempt from forced sale under any process of law. In none of those states is the homestead exemption limited to seizures based upon the owner's *432 debts. We concede, however, that the homestead exemption in Oklahoma is limited to seizures based upon the owner's debts and that the homestead provision is not distinguishable from ours. However, we disagree with the Oklahoma court's holding in State ex rel. Means in which the court disregarded the limiting language of the homestead provision and held that the homestead was protected and that the homestead exemption was not limited to forced sales for the payment of debts.
Although conscious that the homestead exemption is to be construed liberally[1] and that forfeiture statutes are to be strictly construed in a manner favorable to the person whose property is being seized,[2] we do not believe the homestead exemption can be construed to protect Helm's homestead from foreclosure in this case. The Texas constitutional and statutory provisions pertaining to the homestead exemption specifically indicate that homesteads may not be seized or subjected to forced sales for the payment of the owner's debts or the claims of creditors. The forfeiture of real property based upon the owner's use of that property to conduct criminal activity, such as the manufacture or delivery of methamphetamine, is not a forfeiture for the payment of the owner's debts or the claims of creditors.
The court in 1018-3rd St. recognized that the Texas homestead exemption was created as a direct result of the loss to creditors of numerous homestead farms during the depression. The court stated that the purpose of the homestead exemption was to preserve the integrity of the family and to provide the debtor with a home and a means to support his family.
We find the following language to be instructive:
Neither in this history, nor in any reliable Texas case book authority, do we find even a suggestion that our forebearers conceived of a homestead exemption for the purpose of erecting a barrier behind which criminals might ply their trades while thumbing their noses at law enforcement officers diligently and sincerely seeking to enforce prohibitions residents of the area had expressed a desire for at the ballot box.
Therefore, since it seems apparent that our statutes which make provisions for the action taken herein do not except homesteads and the constitution of Texas does not prohibit such statutory authority we see no good reason why a homestead should protect persons in such operations as the evidence shows were being conducted in this case.
1018-3rd St. v. State, supra at 454. Likewise, we hold that the homestead exemption does not protect a homestead from being seized or forfeited under Chapter 59. Helm's sole issue on appeal is overruled.
The judgment of the trial court is affirmed.
NOTES
[1] See Andrews v. Security Nat. Bank of Wichita Falls, 121 Tex. 409, 50 S.W.2d 253, 256 (1932); Woods v. Alvarado State Bank, 118 Tex. 586, 19 S.W.2d 35 (1929).
[2] See State v. Lot 10, Pine Haven Estates, 900 S.W.2d 400, 402 (Tex.App.-Texarkana 1995, no writ); State v. Young's Market Company, 369 S.W.2d 659, 662 (Tex.Civ.App.-Eastland 1963, writ ref'd n.r.e.). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588761/ | 972 So.2d 190 (2008)
GRIFFIN
v.
STATE.
No. 3D07-2614.
District Court of Appeal of Florida, Third District.
December 5, 2007.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588764/ | 706 F.Supp. 131 (1989)
Louise LAMPHERE, on behalf of herself and all others similarly situated
v.
BROWN UNIVERSITY IN PROVIDENCE IN THE STATE OF RHODE ISLAND AND PROVIDENCE PLANTATIONS, et al.
Civ. A. No. 75-0140 P.
United States District Court, D. Rhode Island.
February 9, 1989.
*132 *133 Milton Stanzler, Providence, R.I., for plaintiff.
Beverly Ledbetter, Legal Counsel, Brown University, Peter J. McGinn, Tillinghast, Collins & Graham, Providence, R.I., for defendant.
OPINION AND ORDER
PETTINE, Senior District Judge.
The parties to the Consent Decree entered in this case in 1977 have filed cross-motions requesting that the Court take certain actions with regard to the Decree. The plaintiff class, women faculty members of Brown University, has moved the Court to modify the Decree by setting a goal for tenuring women faculty to be attained by 1991, calculated in accordance with certain projections. The defendant, Brown University, has moved for a determination as to whether the Consent Decree has terminated. In the alternative, the University has requested that, if the Court finds that the Decree has not terminated, it set a termination date for said Decree and modify certain aspects for its future operation.
I. BACKGROUND
The named plaintiff filed her complaint on May 10, 1975, and her amended complaint on February 11, 1976, alleging that the University and certain officers and individuals were engaged in employment discrimination based on sex in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. Section 2000e et seq., as amended. The defendants denied the allegations. The matter was certified as a class action on July 21, 1976.
A. The Consent Decree
A consent decree was issued, with the consent of the defendants, on September 12, 1977. The Decree permanently enjoined the University from "discriminating against women on the basis of sex with respect to all terms and conditions of faculty employment, including recruitment, hiring, promotion, contract renewal and tenure." Lamphere Consent Decree, Section 1.
Beyond this general prohibition, the Decree further ordered the University to take steps to ensure the University's success in achieving the Decree's broad purpose. Among these was the establishment of precise numerical objectives for appointing women faculty or promoting women to tenure:
2. The University is ordered to take the following affirmative steps:
(A) Develop and maintain goals and timetables in accordance with Exhibit A.
(B) Until the goals as set forth in Exhibit A are attained and full utilization of women faculty based on statistical availability as defined in Exhibit A is reached, apply affirmative action on behalf of women faculty in hiring, contract renewal, promotion, and tenure by giving preference to a female candidate of equal qualifications over non-minority males....
Consent Decree, Section 2. Exhibit A established goals and timetables "describing the number of women who it is expected will be members of the tenured and nontenured regular faculty at Defendant Brown University in the future." Consent Decree, Exhibit A, Section 1. The goals represented "an attempt to attain a faculty composition by sex which is based on full utilization of qualified women, as measured by their availability." Consent Decree, Exhibit A, Section 1. The term "full utilization" was defined in this way:
*134 Full utilization in any given year should be the expected composition by sex of tenured and nontenured regular faculty positions in that year as measured by availability of men and women recipients of PhD degrees in the various disciplines and subdisciplines represented by departments or programs at the University.
Consent Decree, Exhibit A, Section 4. The Decree also carefully set out the appropriate national availability pools for tenured and nontenured women, and the sources of data relied on to determine the proportion of women in the availability pools. The Decree then derived from the availability data the following goals and timetables, delineated by areas of related academic disciplines:
Tenured Women: 1979 1983 1987
Humanities 13.5 22.3 30.7
Social Sciences 3.3 7.1 10.7
Physical Sciences 3.3 4.6 6.0
Life Sciences 5.3 8.7 9.6
____ ____ ____
Total 25.4 42.7 57.0
Nontenured Women: 1979 1983 1987
Humanities 24.2 23.2 24.7
Social Sciences 8.4 7.7 7.5
Physical Sciences 2.2 2.6 2.0
Life Sciences 7.9 6.2 6.5
____ ____ ____
Total 42.7 39.7 40.7
Consent Decree, Exhibit A, Section 6a. The Decree stated that, "In calculating these goals and timetables, it has been assumed that the attrition rate of male tenured faculty for reasons other than retirement will continue to be as great as it has been in previous years. It has also been assumed that the attrition rate of female tenured faculty will be zero."
It must be noted that the goals and timetables were not intended as ends in themselves, but were set "to provide a measure of the extent to which the affirmative action procedures elaborated elsewhere [in the Decree] are operating effectively." Consent Decree, Exhibit A, Section 2. An important premise of the Decree is that, "The effectiveness of affirmative action procedures can be measured in part by the time within which they succeed in achieving and maintaining a situation where the proportion of women in tenured and untenured positions on the Brown faculty reflects the proportion of women in the appropriate pool of available PhD's." Consent Decree, Exhibit A, Section 3.
A second step ordered by the Decree was the establishment of an Affirmative Action Monitoring Committee ("AAMC"), which was charged with the implementation and enforcement of the Decree. Consent Decree, Section 2(L). The AAMC was to have five members. Of the original committee, two members were to be selected by the plaintiff and two members were to be elected by the voting faculty of the University; these four members were to select a fifth member from the tenured faculty. Committee members were to serve a term of three years. At the end of the first three year term, a panel of three tenured faculty persons (nominated earlier by the plaintiff) was to select the successors to the two Committee members selected by the plaintiff. This same 3-person panel was also to elect a panel to succeed it. All successor panels were to proceed likewise first selecting the two persons who would serve as Committee members and then choosing a new 3-person panel. The remaining three Committee members were to continue to be elected in the same manner as their predecessors.
Among its implementation and enforcement duties, the AAMC was charged specifically with ensuring the updating of the goals and timetables established in Exhibit A. Consent Decree, Exhibit A, Section 11. *135 The Decree anticipated that such updating might be necessary because of the possibility of changes in the underlying variables used to calculate the goals and timetables.
First, the number of faculty positions could change. The goals were set in part on the basis of a staffing plan indicating the current and anticipated number of faculty positions for tenured and nontenured regular faculty at the University. Because the plan was subject to modification, the University was ordered to file a staffing plan, as modified, with the AAMC by July 1 of each year. If the modified staffing plan provided for an increase in the number of faculty positions, above that which was originally projected, the goals and timetables were to be adjusted to reflect such increase. Consent Decree, Exhibit A, Section 7.
Second, the availability of women PhD recipients could change. The University was ordered to supply the Committee with a copy of any relevant data sources concerning PhD recipients. The Decree anticipated that the goals and timetables it set forth would be "updated, on a bi-annual basis beginning with the academic year 1981-82, in accordance with the principles for establishing goals and timetables [set forth in the Decree] as well as in accordance with the new data." Consent Decree, Exhibit A, Section 8.
The Decree suggested that the parties try to reach agreement on the updated goals and timetables, but it provided for the situation where they did not agree: "In the event that the parties cannot agree upon updated goals and timetables ..., updated goals and timetables will be determined by the Monitoring Committee, or the Court, in accordance with the principles established by this Exhibit [Exhibit A of the Decree]." Consent Decree, Exhibit A, Section 11.
Certain procedural matters were also treated in the Decree. To ensure compliance, the Decree empowered the AAMC to hear any complaints as to violations and to review University decisions on hiring, contract renewal, promotion and tenure. Consent Decree, Section 2(L). The Decree further provided for the appeal of Committee decisions to the Court:
In the event that any woman is dissatisfied with a decision of the Committee which directly affects her, she may seek de novo consideration by appropriate motion to the Court. Likewise, de novo judicial consideration of Committee decisions with respect to implementation or compliance with the provisions of this Decree may be initiated by any class member. The University may also seek de novo consideration of any decision of the Committee by appropriate motion to the Court.
Consent Decree Section 2(L). The Decree specified the burden of proof applicable to both the AAMC reviews and the de novo consideration by the Court. In both settings, the burden of proof differed from that typically used in Title VII cases. The Decree required the employer (here, the University) to prove by clear and convincing evidence that it had not discriminated on the basis of sex. Consent Decree, Section 2(F)(1)-(4).
B. Conflict Over the Consent Decree
The instant action arises out of a recent revision, agreed to by the University and the AAMC, in the goals and timetables spelled out in Exhibit A for 1987.
According to testimony, the AAMC and the University agreed that the goal for tenured women in 1987 needed to be revised for several reasons, among them attrition of tenured women faculty, changes in the number of tenured positions, and changes in the total number of faculty. (Testimony of M. Glicksman, Transcript of Hearing, October 18, 1988 (hereafter "Tr."), p. 28.) In March 1987, the Committee accepted the University's proposed revision of the goal from 57 to 50 tenured women for 1987. (Letter to the Court from Karen Newman, Chair, AAMC, March 16, 1987, appended to Motion of Brown University to Set a Termination Date and/or Modify the Lamphere Consent Decree). The plaintiff class did not directly participate in or agree to this revision. (Statement of plaintiffs' counsel, Tr. 27; Plaintiffs' Reply *136 to Defendant['s] Memorandum to Modify Lamphere Consent Decree, p. 3.)
At some later time, the University informed the AAMC that it did not intend to update goals beyond 1987.[1] Responding to the language of Exhibit A, which charged the Committee or the Court with determining updated goals and timetables in the event that the parties could not agree to do so, the AAMC took action. By applying the principles articulated in Exhibit A, Sections 3-6, the Committee established a range for the updated goal of an additional 11 to 16 women to be promoted or appointed to tenured positions by 1991. Further scrutiny of this range led the AAMC to decide, on the basis of such factors as median age of promotion to tenure and the increasing proportion of women holding PhDs in the age groups being tenured, that the most appropriate goal for 1991 was 15 additional appointments to tenure. Report of the AAMC, "Revision and Updating of Goals and Timetables for Tenured Women Faculty for 1991".
In the aftermath of these events, the plaintiff class moved this Court to modify the Decree in accordance with the AAMC's projections. Defendants in turn moved for the termination of the Decree or, in the alternative, its modification pending a requested termination date of June 30, 1990.
II. THE ISSUES
A. Termination or Continuation of the Consent Decree
The principal cluster of issues broached by the motions presently before this Court is whether the Consent Decree has dissolved on its own terms; whether, if it has not naturally expired, it should nevertheless be terminated due to changed circumstances; or whether, if still in full force and effect, it should be modified to reflect present realities and if so how.
The plaintiffs' position, spelled out in their May 31, 1988 Motion to Modify Consent Decree, is that the goal of tenuring 57.0 women faculty by 1987 was not met by the University, that "full utilization of women faculty based on statistical availability" has thus not yet been achieved, and consequently that the goals and timetables established in Exhibit A must be revised and updated in order to guide the University's continued efforts to attain the ultimate goal contemplated by the Decree of "full utilization of women faculty." In keeping with this analysis, plaintiffs urge the Court to adopt the report issued by the AAMC establishing the goal of 15 appointments of women to tenure by 1991.
Defendant Brown University counters plaintiffs' motion to update the goals and timetables with a Motion to Set a Termination Date and/or Modify the Lamphere Consent Decree, filed with this Court July 1, 1988. Defendant's basic position is that, based on the University's strong affirmative action record in the years since the Consent Decree was adopted, the time has come for this Court to determine that the University has substantially complied with the terms of the Decree, which does not establish goals and timetables beyond 1987, and thus that the Decree has terminated. Defendants cite in support of this proposition the following facts: that in March 1987, after receiving information from the University about attrition of women from the tenured faculty and changes in the number of tenured positions in the years since 1978, the AAMC adopted a "revised goal" of 50 tenured women faculty by June 30, 1987;[2],[3]; that the University successfully *137 met this "revised goal"; that, in addition, the University had greatly exceeded the goal of 40.7 non-tenured women faculty by June 30, 1987, having appointed 58 women to non-tenured positions by that time; that, on an interdisciplinary basis, the University has fully achieved the original goals and timetables for nontenured women by June 30, 1987 and had achieved the "revised goal" for tenured women in three of four disciplines, excepting only the Humanities; that the University had achieved the "revised goal" for the Humanities within one year of the original timetable, that is by June 30, 1988; and that, when compared to comparable institutions, Brown now "stands at the top relative to non-tenured women appointments and third of eleven for tenured women faculty". See generally Memoranda in Support of Brown University's Motion to Set a Termination Data and/or Modify the Lamphere Consent Decree, July 1988 and December 1988. In the alternative, defendant argues, the Court should determine that the Consent Decree should continue as to tenured women only to a date not later than June 30, 1990, three years beyond the last expressed date in the current goals and timetables and the last year mentioned in any context in the Decree, and should then terminate, assuming that the University has substantially complied by that date with whatever updated goals and timetables are adopted by the Court.
1. The Law Governing Termination or Modification of the Consent Decree
There is no disagreement between the parties as to the law governing termination or modification of a consent decree like the one currently before this Court. As the Supreme Court made clear in United States v. Swift & Co., 286 U.S. 106, 52 S.Ct. 460, 76 L.Ed. 999 (1932), a trial court may, in the exercise of its equity jurisdiction, modify a consent decree only upon a showing that "changed circumstances" have transformed the decree into an instrument of oppression:
There is need to keep in mind steadily the limits of inquiry proper to the case before us. We are not framing a decree. We are asking ourselves whether anything has happened that will justify us now in changing a decree.... The inquiry for us is whether the changes are so important that dangers, once substantial, have become attenuated to a shadow.... Nothing less than a clear showing of grievous wrong evoked by new and unforeseen conditions should lead us to change what was decreed after years of litigation with the consent of all concerned.
Swift & Co., 286 U.S. at 119, 52 S.Ct. at 464. This test of "changed circumstances" resulting in "grievous wrong" has been consistently recognized and applied by both the First Circuit and this Court. See, e.g., Coalition of Black Leadership v. Cianci, 570 F.2d 12, 14 (1978); Morris v. Travisono, 499 F.Supp. 149, 156 (D.R.I.1980). Among the changed circumstances recognized by this Court as providing a meritorious reason for terminating a consent decree are new conditions, either factual or legal, that render continued enforcement unnecessary to effectuate the decree's original goals. Id., 499 F.Supp. at 157.
2. Application to the Lamphere Consent Decree
In its prayer to terminate the Lamphere Consent Decree, defendant Brown University makes little effort to argue that continued compliance with the terms of the Decree is unduly onerous or, in the words of the Swift Court, would cause the University to suffer "hardship so extreme and unexpected as to justify us in saying that they are the victims of oppression." Swift & Co., 286 U.S. at 119, 52 S.Ct. at 464. The essence of the University's limited hardship argument is succinctly summarized in the December 5, 1988 affidavit of Provost Maurice Glicksman, in which he asserts that it is unduly onerous for a university of Brown's statute to be the only institution in *138 its institutional peer group operating under the constraints of a judicial decree. While this Court is sympathetic to the University's discomfort with having to endure court supervision of affirmative action on its campus, the fact remains that the University consented to such oversight and has succeeded, while operating under the terms of the Decree, in making strides toward accomplishing the purposes of the order. To be required to continue to operate in the same manner that it has successfully operated in the past hardly amounts to the kind of extreme and unexpected hardship necessary to justify the termination of a consent decree. Although this Court finds no pleasure in its role as monitor in this case, this is of no consequence the law as enunciated in Swift is clear and controlling.
Defendant's principal argument for terminating the Consent Decree is that, by complying with the goals and timetables established in Exhibit A, as "revised" in 1987 by the AAMC, it has complied fully with the Consent Decree as a whole, and thus the Decree should be terminated as no longer necessary to effectuate its goals. This attempt by the University to equate the broad purposes of the Consent Decree as a whole with the incremental objectives adopted in Exhibit A to guide appointments of women faculty to tenure, unjustifiably equates the ultimate goals of the Decree with its operational provisions. As the plain language of the Consent Decree makes clear:
... it is the objective [of the parties] by the entry of this Decree to correct previous injustices, if any, and to achieve on behalf of women full representativeness with respect to faculty employment at Brown University.
Consent Decree, Preamble. To accomplish this objective, the Decree defines with great precision specific, affirmative steps that the University must take, of which developing and maintaining goals and timetables in accordance with Exhibit A is but one. Indeed, even a cursory review of the Decree makes clear that it obligates the University to achieve not only the numerical objectives spelled out in Exhibit A, but also to take specific steps to apply affirmative action on behalf of women faculty in every phase of the employment process, from recruitment and hiring through contract renewal, promotion and tenure decisions until full utilization of women faculty based on statistical availability is reached. See generally Lamphere Consent Decree, Section 2(C)-(L).
Furthermore, as plainly stated in Exhibit A, achievement by the University of the objectives limned in the goals and timetables in no way substitutes for compliance with the Decree's overarching goal of achieving "full representativeness" of women on the University's faculty:
The purpose of the Goals and Timetables herein described is to provide a measure of the extent to which the affirmative action procedures elaborated elsewhere are operating effectively.
Lamphere Consent Decree, Exhibit A, Section 2. At best, then, even exact attainment of the goals and timetables would serve as but one indication that the University is moving toward achieving the Decree's purposes of correcting previous injustices and attaining full representativeness of women on the faculty.
Accordingly, to assess whether "continued enforcement would still seem necessary to effectuate the goals of the decree", this Court must look to the University's accomplishment of the goals of the Consent Decree as a whole. Morris v. Travisono, 499 F.Supp. 149, 157 (D.R.I.1980). By this measure, Brown University cannot demonstrate that the broad purposes of the Lamphere Consent Decree have been achieved or even that all of the specific objectives established by the Decree as measures of goal attainment have been accomplished. Setting aside for the moment the somewhat complicated question of whether tenuring 50 women by 1987 satisfied the tenuring requirements of the original goals and timetables, the University has clearly fallen short on other indicia of "full representativeness" such as appointing women to tenured positions in each of the Departments or Divisions of the University. According to the University's EEO Officer, five Departments of the University (Computer Science, *139 East Asian Studies, Economics, Education and Music) had no tenured women faculty as of November 22, 1988. Although the Decree sets 1990 as the time by which the University is to accomplish the objective of tenuring women to all academic units of the institution, taking into account the size of the Department or Division and the appropriate availability pools, the fact remains that they have not accomplished this requirement despite their motion to terminate the Consent Decree. Consent Decree, Exhibit A, Section 9. By the logic of the Decree itself, such lapses in the University's compliance are fairly interpreted as evidence that the continued enforcement of the Decree is necessary in order to ensure that affirmative action is operating effectively at the University.
In sum, since the defendant has not shown that its continued compliance with the Decree causes it to suffer extreme and unexpected hardship, and since continued enforcement remains necessary to effectuate the broad goals of the Lamphere Consent Decree, I must deny defendant's motion to terminate the Decree in its entirety.
3. Goals and Timetables During Continuation of the Lamphere Consent Decree
The question remains, however, whether the University has at least fully accomplished the objectives established in Exhibit A of the Consent Decree and if so whether the Decree should be terminated at least as to Section 2(A)-(B) and Exhibit A, Sections 1-6a.
The University asserts, and plaintiffs agree, that it has exceeded by 40% the goals for appointing nontenured women to the faculty (Memorandum in Support of Brown University's Motion, December 1988 (hereafter "D. Memo. Dec. 1988"), p. 9) and that it has fully achieved the goals for appointing nontenured women on a disciplinary basis (Memorandum in Support of Brown University's Motion, July 1988 (hereafter "D. Memo. July 1988"), p. 2). In light of defendant's excellent record in this regard, this Court sees no reason to establish new goals and timetables for nontenured women. Accordingly, the strictures of the Consent Decree are lifted as to the development and maintenance of goals and timetables for increasing the number of nontenured women on the University faculty. This order does not, however, terminate the Consent Decree as to the many protective mechanisms put in place to safeguard women faculty, both nontenured and tenured, in every phase of the employment process. To the extent that nontenured women at Brown University require continued recourse to the full array of affirmative action procedures outlined in the Decree, these mechanisms remain at their disposal.
The question of whether the University has fully achieved the goals set out in Exhibit A for tenured women is more difficult of solution, with defendant arguing that, by meeting the "revised goal" of 50 for 1987, it has fully complied with the goals and timetables, and plaintiffs responding that, by agreeing to a "revised goal" for 1987, the AAMC did not simultaneously agree on behalf of the plaintiff class to a redefinition of the key concept of "full utilization of women faculty based on statistical availability" and thus to a permanent downward revision of the overall goals for appointing women to the faculty. In plaintiffs' eyes, then, the "full utilization" goal for 1987 remains 57, as originally set in Exhibit A, and updated goals for future years should be calculated from this base.
Underlying the parties' disagreement over whether the goals and timetables have been met as to tenured women are differing views of how "full utilization in any given year" is to be determined, in particular how attrition of women from the faculty should be factored in to evaluating whether or not Brown has met its responsibilities under Exhibit A. According to Exhibit A, "full utilization in any given year" is a statistical projection of the number of women expected to be employed by the University in that year "as measured by the availability of men and women recipients of PhD degrees in the various disciplines and sub-disciplines represented by *140 departments or programs of the University." Consent Decree, Exhibit A, Section 4. This projection is made by determining, based on departmental staffing plans, the number of anticipated openings in each department or division of the University in the year in question, then multiplying the projected openings in each department or division by the percentage of women in the PhD availability pools for the relevant disciplines, and finally summing across all academic units. The resulting figure is the number of women, based on statistical availability, that the University should be expected to hire to ensure that women are represented on the faculty to the same degree that they are represented in the national pool of candidates qualified for academic appointments. Logically, then, the "full utilization" goal for any given year would be subject to revision only if there are changes in the statistics underlying the calculation of the goal, namely in the number of projected openings on the faculty or in the percentage of women in the relevant availability pools.
The genesis of the present impasse is the recent attempt by the University to amend the calculus outlined above. Specifically, as the 1987 deadline for tenuring women to the Brown faculty approached, the University sought to modify the formula employed to calculate the goals and timetables by factoring in the number of women lost to the University due to attrition, either through death, retirement or resignation. While it is true that Exhibit A, Section 6a of the Consent Decree indicates that the 1987 goal of 57 tenured women assumed no attrition of women from the tenured faculty (thereby implying that the goal should be revised if attrition were to become a significant factor in determining the number of women on the Brown faculty), the Decree provides no guidance as to how attrition should be factored in to recalculate the goal should the assumption of zero attrition prove false. Nevertheless, both the University and the AAMC claim to have taken attrition into account in some way in arriving at the "revised goal" of 50 for 1987.
Although this Court appreciates the distinction between tenuring and retaining women faculty, and thus understands that Brown University may succeed in appointing to tenure the number of women dictated by the terms of the Consent Decree only to lose some of them to attrition, the fact remains that only a carefully tailored approach to factoring attrition in to the "full utilization" calculus will prevent the gradual erosion of the proportion of tenured women on the Brown faculty due to attrition. More specifically, to allow the University annually to adjust the goals and timetables downward to reflect attrition will gradually diminish the base from which future expected increases in women faculty are calculated and act as a drag on the University's efforts to achieve "full representativeness with respect to faculty employment." Additionally, just as attrition might fairly need to be factored in to reduce the University's tenuring goals for a given year, so too the positions left open by attrition should also be added to the number of projected openings at the University, thus resulting in a countervailing increase in annual tenuring goals. In short, for this Court to accept a downward revision of the goals and timetables for 1987,[4] the manner in which the attrition variable is factored into the "full utilization" equation must be carefully calculated to preserve the Decree's overarching purpose of "full representativeness."
Having carefully reviewed the entire record in this case, including the testimony of University officials and an AAMC representative at the October 18, 1988 hearing on this matter, this Court cannot say exactly how attrition has been factored into the recalculation of the 1987 goals and timetables *141 and thus cannot conclude that the method adopted was carefully tailored to preserve the ultimate intent of the Consent Decree. While it appears that the University and the AAMC agreed to revise the goal by deducting the number of women leaving employment from the total number of women tenured by the deadline, no explanation is given for this approach. (Testimony of M. Glicksman, Tr. 28-35; Testimony of H. Ward, Tr. 78.) It is also unclear on this record how or whether the effect of attrition on the number of projected openings at the University, and thus on the calculation of the goals and timetables, has been taken into account. Because this Court is powerless to modify the Consent Decree absent a showing of changed circumstances that make continued enforcement of the Decree as originally crafted oppressive, and because defendant has failed adequately to document its claim that 50 is a carefully tailored revision of the Decree's tenuring goal for 1987 necessarily made to avoid such oppression, this Court can only conclude that "full utilization" for 1987 remains at 57. Since the University has admittedly not achieved this goal, the Consent Decree is to remain in full force and effect as to tenured women faculty until at least June 30, 1991.[5]
Finally, taking 57 as the base figure for 1987, this Court further determines that the updated goal for 1991 will be 13 additional promotions or appointments to tenure, for a total goal for 1991 of 70 tenured women faculty.[6] Although the AAMC has made cogent arguments for adopting a goal for 1991 of an additional 15 tenured women,[7] this Court finds that the counter-proposal of 13 advanced by the University[8] is the most realistic given this Court's insistence that 57 be retained as the base figure for 1987. Of course, as in the case of nontenured women faculty, tenured women faculty may continue to avail themselves of all the protective mechanisms outlined in the Lamphere Consent Decree.
B. Burden of Proof
The defendant has also questioned the validity of the burden of proof mandated by the Decree for use in proceedings before the AAMC and the Court. The Decree requires that, when a candidate for a faculty position alleges that the University has discriminated on the basis of sex, the employer must prove by clear and convincing evidence that it did not discriminate on the basis of sex. Consent Decree, Section 2(F)(1)-(4). This "clear and convincing" standard is to be applied to judge the University's decisions in faculty recruitment, hiring, contract renewal, promotion and tenure as they affect women.
The defendant has proposed that the Court modify the burden of proof to conform to that typically used in Title VII cases. In an ordinary Title VII case, once the plaintiff makes out a prima facie case of discrimination, the employer must "articulate" a legitimate, nondiscriminatory reason *142 for its actions. If the employer does so, the plaintiff must then show, by a preponderance of the evidence, that the asserted reason is a mere pretext for unlawful behavior. See, e.g., Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 252-53, 101 S.Ct. 1089, 1093-94, 67 L.Ed.2d 207 (1981). The burden of persuasion remains on the plaintiff throughout. See id. at 254-56, 101 S.Ct. at 1094-95.
The defendant states that, prior to Burdine and Board of Trustees of Keene State College v. Sweeney, 439 U.S. 24, 99 S.Ct. 295, 58 L.Ed.2d 216 (1978), it was thought that an employer was required to prove that the articulated non-discriminatory reason for rejecting the female applicant (the Title VII plaintiff) was in fact the true reason. Thus, when these parties filed the Consent Decree and when the Court entered that Decree in March 1978, the United States Supreme Court had not clarified, as it did in Burdine and Sweeney, that an employer's burden of proof was merely to articulate a non-discriminatory reason for its action and that the burden of persuasion always remained with the plaintiff (D. Memo. Dec. 1988, p. 11). This chronology of events is generally correct. The decisional law has been clarified since the entry of the Decree, so that the burden on an employer in an ordinary Title VII case is less than that set by the Decree as the burden of proof to which the University is held.
The burden of proof set by the Consent Decree was not directly based on a specific statute or prior judgment that was subsequently reversed, vacated or reconstrued, a circumstance which would allow a court to modify a consent decree to conform it to the change in the law. Theriault v. Smith, 523 F.2d 601 (1st Cir.1975). Instead the burden of proof was based generally on the state of the law before the Supreme Court had clarified the Title VII standard in Sweeney and Burdine. Thus the Decree must be evaluated according to the equitable principles of the Swift test: Has the party proposing the modification made "a clear showing of grievous wrong evoked by new and unforeseen conditions"? Defendant has not made this showing.
To support its position, defendant has put forth three reasons why the Court should modify the burden of proof:
(1) the achievement of the goals and timetables by the University,
(2) the clarification by the Supreme Court in Burdine and Sweeney of the Title VII burden of proof, and
(3) the pronounced difficulty experienced by some members of the AAMC in dealing with the University's proof of a negative, i.e., that it did not discriminate.
The first reason is irrelevant to the burden of proof issue. The University's success in meeting stated goals has no effect on the methods by which the parties are to respectively present and defend against a charge that a certain decision was tainted by sex discrimination.
As to the second reason, the fact that the law has changed could perhaps be characterized as a "new and unforeseen condition" permitting modification of the Decree if resulting in "grievous wrong". See Morris v. Travisono, 499 F.Supp. 149, 153-57 (D.R.I.1980) (a change in the state of the law may justify vacating a consent decree if continued enforcement of the decree works an injustice or constitutes a grievous wrong). However, the University has failed to allege any "grievous wrong" resulting from the "new condition". The fact that the law of Title VII now imposes a lesser burden on the employer than does the Consent Decree does not itself mandate a modification. In Lamphere v. Brown, Appeal of Ann W. Seidman, 798 F.2d 532, (1986) the First Circuit considered the validity of the Lamphere Consent Decree's burden of proof rules after Sweeney and Burdine.[9] The Circuit Court found guidance in *143 Supreme Court precedent: "The Supreme Court has recently held that the particular provision of Title VII that limits a court's power to `order' relief does not affect the validity of a consent decree. See Local Number 93, Int'l Ass'n of Firefighters v. City of Cleveland, 478 U.S. 501, 106 S.Ct. 3063, 92 L.Ed.2d 405 (1986) (construing Civil Rights Act of 1964, Title VII, Section 706(g))." The First Circuit found that the burden of proof rules set out in the Consent Decree "do not plainly exceed the bounds of `reasonable [sex]-conscious relief' (citation omitted)", and concluded that it was proper to apply the Decree's rules in considering the claim before it. This Court agrees with the First Circuit's analysis of this issue and adopts its reasoning here.
The University's third rationale is that there is "confusion on the burden of proof by the AAMC." (D. Memo. July 1988, pp. 7-8, n. 4). In support of this allegation, the University states that: "On January 23, 1980 [while reviewing the discrimination claim of Ann Seidman], the AAMC noted that the University under its burden of proof was required to prove a negative by clear and convincing evidence, a requirement the AAMC termed a `logical impossibility'" (D. Memo. July 1988, p. 7, n. 4.) Defendant, however, has related only half the story; the rest is told by the First Circuit in its opinion on the claim of Ann Seidman:
Concerned that a literal interpretation of the decree would impose on Brown the near-impossible task of "proving a negative" (that it did not discriminate based on sex), the Monitoring Committee rephrased the decree's substantive standard as follows:
"the University must show that [its] action can be plausibly explained without reference to considerations of sex, and it must provide clear and convincing evidence that such an explanation is the correct one."
That is to say, the decree requires Brown 1) to articulate a legitimate, nondiscriminatory reason for its actions, and 2) to show by clear and convincing evidence that this reason is not a pretext. The parties basically agree that this interpretation is reasonable, and so do we.
Appeal of Ann W. Seidman, 798 F.2d at 536 (1986). Defendant has produced no recent evidence indicating that the AAMC is finding the burden of proof difficult to apply, nor do the AAMC's own reports suggest that the AAMC is having problems functioning with this burden of proof.
I realize that the Decree established a high standard for the University to meet, higher than that typically imposed in Title VII actions. However, this higher standard is the one on which the parties agreed, and I cannot modify it absent evidence that the use of this standard is now causing grievous wrong.
C. Scope of Judicial Review
Defendant has asked the Court to recognize formally that the Consent Decree contemplates that an appeal of a decision by the AAMC will be given a completely new hearing by this Court. The issue of the scope of review was resolved by the First Circuit in Appeal of Ann W. Seidman. The Circuit Court said: "[The district court] believed the decree required a full judicial trial. And, we conclude that the court was correct." Id., 798 F.2d at 537. The parties, therefore, can expect that any appeal of an AAMC decision to this Court will receive a full judicial trial.
D. Composition of the Affirmative Action Monitoring Committee
Defendant has asked that the Court modify the selection of members for the AAMC in two ways.
First, it asks that "the two AAMC members currently selected by the Plaintiff Lamphere should be elected by secret ballot of the tenured and non-tenured women faculty." At the October 18 hearing, counsel for both parties agreed to this modification, and the Court stated that the Decree could be so modified. (Tr. 87-88). However, plaintiffs, in their brief in opposition *144 to defendant's motion, object to the modification:
A re-reading of Section (L) of the Decree provides that after the selection of the first (nominating) panel by Plaintiff Louise Lamphere, that nominating panel and its successors shall select ... successors. This has been the process and continues. Louise Lamphere has not nominated any panel other than the first one in 1977. Thus, there would be no need for modification.
Plaintiffs' Brief in Opposition to Defendant's Motion to Terminate or Modify Consent Decree, p. 2. Indeed, Section 2(L) provided that the plaintiff was to select two members of the original AAMC who would serve for a term of three years and was also to nominate a panel of three tenured faculty persons. This panel was to select two replacements for the AAMC and was to elect its own successors. If the process has in fact been operating in this manner, there is no need to modify the Decree in this regard.
Second, defendant asks that the University be allowed to select the fifth member of the AAMC. Currently that member is chosen by the four other AAMC members two of whom are chosen by the panel, described above, and two elected by the voting faculty of the University. The University states: "While such a step would continue the AAMC as a faculty-based body, it would insure, we submit, a more representative committee to reflect matters of common interest to the faculty and the Administration and insure that there will be a balanced representation of disciplines on the Committee if the election process does not achieve such balance." (D. Memo. Dec. 1988, p. 14). This vague statement of the anticipated benefits from such a modification does not provide even an inkling that the current selection process is working an injustice to the University, much less that the AAMC is an instrument of "grievous wrong" according to the Swift test. Instead it merely provides an alternative but significantly different method for composing the Committee. The Consent Decree simply does not provide for selection of a Committee member by the University and defendant has presented no evidence to support modifying the composition of the AAMC in this way.
III. CONCLUSION
To summarize, this Court holds that the Lamphere Consent Decree is to continue in full force and effect as to tenured women faculty and is to continue but for the establishment of updated goals and timetables for nontenured women faculty; that the new goal for tenured women faculty, to be achieved by June 30, 1991, is 70; that the AAMC will convert this overall goal to proposed sub-goals by academic areas by June 30, 1989, and will by that date inform the Court of these sub-goals and the precise method of their calculation; that the burden of proof to be applied by the AAMC and the courts will continue to be that originally established in the Decree, that is that the University must show by clear and convincing evidence that decisions made regarding faculty employment are non-discriminatory as to sex;[10] and that the method of electing members to the AAMC will remain as originally set forth in the Decree. In addition, this Court restates the First Circuit's holding in Appeal of Ann W. Seidman, 798 F.2d at 537, that any appeal of an AAMC decision to the courts shall be given a full judicial trial.
In arriving at these holdings, this Court wishes to assure the parties that it is sensitive to the difficulties created by direct court supervision of the internal affairs of academic institutions. As much as the Court might wish to withdraw from this role in the case at bar, however, the fact remains that this great nation has laws that must be obeyed and no court can alter or terminate a consent decree absent the necessary showing of changed circumstances. It is instead this Court's fervent hope *145 that, by June 30, 1991, the parties will have succeeded not only in achieving the goal of full utilization of women faculty, but also in implementing an internal affirmative action plan whose existence will enable this Court to reconsider the need for the Lamphere Consent Decree. Until such time, I am, despite my sympathies, powerless to ignore clear legal precedent and set aside this Decree.
NOTES
[1] In fact, the University's Provost has admitted that Brown rarely complied with the Decree's order to annually file revised staffing plans and updated availability indices, thereby thwarting the Decree's further order that the goals and timetables be updated bi-annually. (Testimony of M. Glicksman, Tr. 47, 49-50; see also Testimony of H. Ward, Tr. 81.)
[2] The "revised goals" for 1987 for tenured women, proposed by the University and agreed to by the AAMC, were as follows:
Humanities 26.7
Social Sciences 8.0
Physical Sciences 6.0
Life Sciences 9.0
____
Total 49.7
Memorandum in Support of Brown University's Motion, July 1988, p. 3.
[3] The AAMC has stated the overall "revised goal" as 50, apparently by rounding 49.7. Letter to the Court from Karen Newman, Chair, AAMC, March 16, 1987, appended to Motion of Brown University to Set a Termination Date and/or Modify the Lamphere Consent Decree.
[4] The University has attempted to argue that "the revision from 57 to 50 tenured women for 1987 has been implicitly recognized by an Order of this Court...." (D. Memo. July 1988 p. 2 n. 2.) In the July 14, 1987 Order to which defendant refers, this Court merely agreed not to hear a motion that had been brought in the matter. No consideration was ever given by this Court to the merits of the "revised goal" for 1987 and no order inserting the number 50 into the Consent Decree has ever been issued.
[5] This Court cannot adopt the June 30, 1990 termination date advocated by the University since neither party to these cross-motions has provided it with the data that it would need to establish updated goals and timetables for 1990. Instead both sides provided the Court with data relevant to calculating updated goals for 1991, and it is this data on which the Court now relies. If, however, the defendant is able to demonstrate compliance with the goals set herein before 1991, it can seek the appropriate modifications and/or termination of the Decree.
[6] Because neither party has provided this Court with the information that it needs to establish sub-goals by areas of related academic disciplines, the Court has stopped at setting an overall goal for 1991. The AAMC is hereby ordered to convert the overall goal to proposed sub-goals by academic areas (i.e., Humanities, Social Sciences, Physical Sciences and Life Sciences) by June 30, 1989, and to inform the Court of these sub-goals and the precise method of their calculation.
[7] See generally Revision and Updating of Goals and Timetables for Tenured Women Faculty for 1991, appended to plaintiffs' Motion to Modify Consent Decree.
[8] See generally Affidavit of Maurice Glicksman, December 5, 1988, appended to D. Memo Dec. 1988. In reaching this conclusion, the Court is mindful of the fact that Brown University now possesses a rich pool of nontenured women faculty, richer in qualified women than the national availability pools on which the goals and timetables are based, from which it can draw in meeting the updated goal of 70.
[9] The First Circuit stated that no party to the case before it argued that the burden-of-proof rules plainly exceeded the bounds of reasonable sex-conscious relief. It is not clear whether the issue of the validity of the Consent Decree's burden of proof was litigated in the Court of Appeals. If it was, then defendant University may be collaterally estopped from raising the issue here. In any event, this Court and the First Circuit are in agreement that the burden of proof rules are valid.
[10] In Appeal of Ann W. Seidman, 798 F.2d at 536, the First Circuit approved the AAMC's rephrasing of the Decree's burden of proof, an interpretation which the parties basically agreed was reasonable at that time. The AAMC may continue to use this interpretation in carrying out its duties. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588777/ | 85 S.W.3d 885 (2002)
350 Ark. 254
Ada WEBB
v.
Michael S. BOUTON, M.D., Holt-Krock Clinic, PLC.
No. 01-920.
Supreme Court of Arkansas.
October 3, 2002.
*886 Law Offices of Charles Karr, P.A., by: Charles Karr and Shane Roughley, Fort Smith, for appellant.
Warner, Smith & Harris, PLC, by: Wayne Harris and G. Alan Wooten, Fort Smith, for appellee.
JIM HANNAH, Justice.
Appellant Ada Webb filed this medical malpractice suit against appellees Dr. Michael S. Bouton, a board certified general surgeon, and the Holt-Krock Clinic, the clinic where Dr. Bouton was employed at the time of the alleged malpractice. Webb raises three points on appeal. She argues: (1) that the trial court erred in allowing *887 Dr. Bouton to testify as to the standard of care; (2) that the trial court erred when it allowed Dr. Fengler to testify; and (3) that the jury's verdict was against the preponderance of the evidence. We find no reversible error, and accordingly, affirm. We have jurisdiction of this matter under Ark. S.Ct. R. 1-2(a)(1), (b)(1), and (b)(3) (2002).
Facts
On December 29, 1998, Appellant Ada Webb brought suit against Dr. Michael S. Bouton and Holt-Krock Clinic, PLC, for medical malpractice relating to hemorrhoid surgery Dr. Bouton performed on Webb on December 30, 1996.
Webb first saw Dr. Bouton on September 26, 1996, for pain from hemorrhoids. At a follow-up visit on October 10, 1996, Dr. Bouton performed a suction hemorrhoid banding procedure. On October 31, 1996, Webb again saw Dr. Bouton for a follow-up visit. At this visit, she complained of leg pain and back pain, and she spoke to Dr. Bouton about some external skin tags with the hemorrhoids. Webb was still experiencing pain on November 21, 1996, and Dr. Bouton referred her to Dr. Waijh Istanbouli, an internist, for further evaluation.
On December 5, 1996, Dr. Bouton recommended hemorrhoid surgery, which he performed on December 30, 1996. Webb saw Dr. Bouton for follow-ups on January 9, 1997, January 21, 1997, January 27, 1997, and February 24, 1997. Webb complained of persistent pain at all of these visits. Noting that the examination was very painful for Webb on the February 24 visit, Dr. Bouton recommended to Webb that he examine her under anesthesia. Dr. Bouton scheduled the examination for the next day, and Webb failed to appear for the visit.
Webb next went to see Dr. David Hunton. On February 28, 1997, he performed a proctoscopy, sphincterotomy, and cauterization of skin tags. On April 28, 1997, Dr. Hunton excised an anal fistula and external skin tags.
Webb was also evaluated by Dr. John Tedford, a colorectal specialist in Little Rock, and by physicians at the Mayo Clinic in Rochester, Minnesota. Webb alleges that she has continued to suffer from pain, incontinence, and other problems since the December 30, 1996, surgery.
Webb alleged that Dr. Bouton committed malpractice because he performed unnecessary surgery, which exacerbated her pain and problems, and because Dr. Bouton did not consult with a colorectal surgeon before he performed the surgery. The case proceeded to a jury trial, and the jury returned a verdict in favor of Dr. Bouton and the Holt-Krock Clinic.
Dr. Bouton's Testimony Concerning the Standard of Care
Webb contends that the trial court erred when it allowed Dr. Bouton to testify as an expert witness as to the standard of care because she was prevented from exploring Dr. Bouton's opinions in discovery. Whether a witness is qualified to testify as an expert upon a particular question is a matter to be decided within the discretion of the trial court. Cathey v. Williams, 290 Ark. 189, 718 S.W.2d 98 (1986). On appeal, the appellant has the burdensome task of demonstrating that the trial court has abused its discretion. Sims v. Safeway Trails, Inc., 297 Ark. 588, 764 S.W.2d 427 (1989).
Webb alleges that Ark.Code Ann. § 16-114-207(3), under the Medical Malpractice Act, is in conflict with Rule 26 of the Arkansas Rules of Civil Procedure. Webb argues that since a physician cannot be compelled to give expert testimony at *888 trial against himself, a defendant physician should not be allowed to give expert testimony in his favor because a plaintiff cannot discover these opinions. Webb contends that even though Ark.Code Ann. § 16-114-207(3) does not apply to discovery, Ark. R. Civ. P. 26(b)(1) "prohibit[s] the exploration of any expert opinions that a defendant physician might have during discovery." We note that the record indicates that this argument was not raised at the trial level. We have often stated that an argument not raised below will not be considered for the first time on appeal. Arkansas Blue Cross and Blue Shield v. Hicks, 349 Ark. 269, 78 S.W.3d 58 (2002); Ghegan & Ghegan, Inc. v. Barclay, 345 Ark. 514, 49 S.W.3d 652 (2001). Accordingly, we do not address the merits of Webb's argument regarding the alleged conflict between Ark.Code Ann. § 16-114-207(3) and Rule 26(b)(1) of the Arkansas Rules of Civil Procedure. Likewise, Webb's argument that Ark. R. Civ. P. 26(b)(4)(A) would require her to compensate Dr. Bouton for his time spent responding to the discovery was not raised below. Accordingly, we will not address the merits of Webb's argument regarding Ark. R. Civ. P. 26(b)(4)(A).
Webb further contends that Ark. Code Ann. § 16-114-207(3) is unconstitutional because it is "fundamentally unfair and violates equal protection because it extends to physicians a privilege which is not extended to any other professional." She states that "there is no rational basis for allowing defendant physicians the privilege of `hiding' their opinions only to surprise a plaintiff at trial with an additional expert opinion," and that there is "no opportunity for plaintiffs to prepare for what opinions the defendant may render." It is impossible for us to address these arguments because Webb failed to include responses to interrogatories in the record, and she failed to include a transcript of Dr. Bouton's deposition testimony. We can hardly determine whether Dr. Bouton and the Holt-Krock Clinic were able to "hide" their opinions and "surprise" Webb at trial when the record contains no information to support the argument.
In Goodwin v. Harrison, 300 Ark. 474, 780 S.W.2d 518 (1989), the court addressed the appellant's argument that the Medical Malpractice Act was unconstitutional. The court wrote:
Appellant next contends that the entire Arkansas medical malpractice act, Ark. Code Ann. § 16-114-207 to-209 (1987), is unconstitutional. She does not explain how the entire act has adversely impacted upon her, a necessary prerequisite to standing, nor does she cite any authority or make a convincing argument to support her position. She merely takes her position that the act is unconstitutional because it violates various listed provisions of the federal and state constitutions. As we have said many times, assignments of error which are unsupported by convincing argument or authority, will not be considered on appeal unless it is apparent without further research that they are well taken. Knoles v. Salazar, 298 Ark. 281, 766 S.W.2d 613 (1989).
Goodwin, 300 Ark. at 483, 780 S.W.2d 518. Like the appellant in Goodwin, Webb does not show how Ark.Code Ann. § 16-114-207(3) has adversely impacted upon her. She contends that the statute is unconstitutional, but she neither cites authority nor makes a convincing argument to support her contention. As this court has stated many times, arguments that are unsupported by convincing argument or authority will not be considered on appeal, unless it is apparent without further research that the arguments are well-taken. Cadillac Cowboy, Inc. v. Jackson, 347 Ark. *889 963, 69 S.W.3d 383 (2002); Jacobs v. Yates, 342 Ark. 243, 27 S.W.3d 734 (2000).
Testimony of Dr. Fengler
Webb argues that Dr. Fengler's testimony should have been excluded as cumulative evidence because he, like Dr. Bouton, testified that Dr. Bouton had met the required standard of care. Under Rule 403 of the Arkansas Rules of Evidence, relevant evidence may be excluded if it is deemed to be a needless presentation of cumulative evidence. Ark. R. Evid. 403. The trial court has broad discretion in decisions of admissibility, and we will not reverse its ruling absent an abuse of discretion. National Bank of Commerce v. Beavers, 304 Ark. 81, 802 S.W.2d 132 (1990).
In determining whether expert testimony is cumulative, the court will compare the testimony of the two experts who are presented. See Skokos v. Skokos, 332 Ark. 520, 968 S.W.2d 26 (1998). If the expert witnesses are not so similar in their credentials and approach to the issues, testimony of both experts will not be considered cumulative. Id. Dr. Bouton is a general surgeon, and Dr. Fengler is a colon and rectal surgeon. The two doctors have varied educational and professional backgrounds. Dr. Bouton and Dr. Fengler agree on the issue of whether or not Dr. Bouton met the standard of care. We do not find that Dr. Bouton and Dr. Fengler are so similar in their credentials and approach to the issues that their testimony should be considered cumulative. Even if the evidence were cumulative, we have stated that merely cumulative evidence is not prejudicial. Threadgill v. State, 347 Ark. 986, 69 S.W.3d 423 (2002). An appellant is required to show that cumulative evidence is prejudicial. Id. Webb has failed to show any prejudice that resulted from Dr. Fengler's testimony. The was no abuse of discretion by the trial court in allowing Dr. Fengler to testify as an expert.
Substantial Evidence
Webb argues that the verdict was against the preponderance of the evidence. Under Ark. R. Civ. P. 59, an appellant may be granted a new trial if "the verdict . . . is clearly contrary to the preponderance of the evidence or is contrary to the law." Ark. R. Civ. P. 59(a)(6). A motion for a new trial is not necessary to preserve for appeal an error which could be the basis for granting a new trial. Ark. R. Civ. P. 59(f). Where a motion for a new trial is made for the first time before this court, the standard of review is whether there is substantial evidence to support the verdict. Hall v. Grimmett, 318 Ark. 309, 885 S.W.2d 297 (1994). In Hall, we explained the standard of review for determining whether there was substantial evidence to support the jury verdict. Id. We noted:
Substantial evidence is evidence of sufficient force and character to compel a conclusion one way or the other with reasonable certainty; it must force the mind to pass beyond suspicion or conjecture. In determining the existence of substantial evidence, we view the evidence in the light most favorable to the party on whose behalf the judgment was entered and give it its highest probative value, taking into account all reasonable inferences deducible from it. In reviewing the evidence, the weight and value to be given the testimony of the witnesses is a matter within the exclusive province of the jury.
Id. at 311, 885 S.W.2d 297 (citations omitted).
We have noted that generally, a defense verdict will always be supported by substantial evidence because the plaintiff has *890 the burden of proof and the jury is the sole judge of credibility of witnesses and the weight and value of the evidence. Anderson v. Graham, 332 Ark. 503, 966 S.W.2d 223 (1998); Morton v. American Med. Int'l, Inc., 286 Ark. 88, 689 S.W.2d 535 (1985). In Morton, we quoted with approval this language from United States Fire Ins. Co. v. Milner Hotels, 253 F.2d 542 (8th Cir.1958):
Thus, no matter how strong the evidence of a party, who has the burden of establishing negligence and proximate cause as facts, may comparatively seem to be, he is not entitled to have those facts declared to have reality as a matter of law, unless there is utterly no rational basis in the situation, testimonially, circumstantially, or inferentially, for a jury to believe otherwise. Morton, 286 Ark. at 90, 689 S.W.2d 535. We then went forward in Morton and stated:
The Supreme Court of Missouri correctly stated the common law rule, which also governs in Arkansas, in Cluck v. Abe, 328 Mo. 81, 40 S.W.2d 558 (1931):
The burden was not on the defendant, but was on the plaintiff to make out the case stated in his petition. In a case where the allegations of the petition are denied by the answer, and the plaintiff offers oral evidence tending to support the allegations of the petition, the defendant is entitled to have the jury pass upon the credibility of such evidence even though he should offer no evidence himself. The court has no right to tell the jury that it must believe the witnesses. The jury, in the first instance, is the sole judge of the credibility of the witnesses and of the weight and value of their evidence, and may believe or disbelieve the testimony of any one or all of the witnesses, though such evidence be uncontradicted and unimpeached.
Morton, supra. We added that we were "not aware of any Arkansas case in which a verdict for a party not having the burden of proof has been set aside in a negligence case solely because it was not supported by substantial evidence." Id.; see also Anderson v. Graham, 332 Ark. 503, 966 S.W.2d 223 (1998).
There was a dispute between Dr. Bouton's expert witness, Dr. Fengler, and Webb's expert witness, Dr. Michael Hellinger, as to whether Dr. Bouton met the standard of care. Also, Dr. Hellinger testified that Webb's problems were exacerbated by the hemorrhoidectomy performed by Dr. Bouton. On the other hand, Dr. Fengler testified that the problems Webb experienced after the surgery were not directly related to the hemorrhoidectomy. It is well-settled that the weight and value of testimony is a matter that is in the exclusive province of the jury. D.B. Griffin Warehouse, Inc. v. Sanders, 349 Ark. 94, 76 S.W.3d 254 (2002); Esry v. Carden, 328 Ark. 153, 942 S.W.2d 846 (1997). There was extensive testimony on both sides and substantial evidence for the jury to find in Dr. Bouton's favor.
Webb further contends that Dr. Fengler's testimony caused the jury to speculate, and that he "only offered possibilities which are not evidence at all." She argues that Dr. Fengler's testimony that fissures "can happen based upon constipation that may happen after any surgery" is speculation as to causation because Dr. Fengler could not state with any degree of medical certainty what was causing Webb's problems.
To support her proposition, Webb cites Kilpatrick v. Bryant, 868 S.W.2d 594 (Tenn.1993), where the Tennessee Supreme Court held:
Thus, proof of causation equating to a "possibility," a "might have," "may have," "could have," is not sufficient, as *891 a matter of law, to establish the required nexus between the plaintiff's injury and the defendant's tortious conduct by a preponderance of the evidence in a medical malpractice case. Causation in fact is a matter of probability, not possibility, and in a medical malpractice case, such must be shown to a reasonable degree of medical certainty.
Kilpatrick, 868 S.W.2d at 602 (citations omitted).
Webb is mistaken as to who has the burden of proof. In a medical malpractice action, the plaintiff must prove the applicable standard of care, that the medical provider failed to act in accordance with that standard, and that such failure was a proximate cause of the plaintiff's injuries. National Bank of Commerce v. Quirk, 323 Ark. 769, 918 S.W.2d 138 (1996); Ark.Code Ann. § 16-114-206 (Michie 1987). Dr. Bouton contends, and we agree, that it was not up to him, as a defendant, or Dr. Fengler, as a defense expert witness, to establish causation at trial. The burden of proof to establish causation was upon Webb, the plaintiff. This argument has no merit.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645231/ | 994 So.2d 1181 (2008)
Tonya Marie STEWART, Petitioner,
v.
STATE of Florida, Respondent.
No. 1D08-2200.
District Court of Appeal of Florida, First District.
November 6, 2008.
Tonya Marie Stewart, pro se, Petitioner.
Bill McCollum, Attorney General, and Heather Flanagan Ross, Assistant Attorney General, Tallahassee, for Respondent.
PER CURIAM.
The petition for belated appeal is granted. Tonya Stewart is hereby afforded a belated appeal from judgment and sentence in case numbers 05-5751 and 05-5755 in the Circuit Court for Escambia County. Upon issuance of mandate in this cause, a copy of this opinion will be provided to the clerk of the circuit court, with directions that it be treated as a notice of *1182 appeal. Fla. R.App. P. 9.141(c)(5)(D). The circuit court is directed to appoint counsel to represent petitioner in the appeal if she qualifies for such an appointment.
PETITION GRANTED.
KAHN, VAN NORTWICK, and PADOVANO, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588824/ | 85 S.W.3d 312 (2002)
Ted WOOD, Appellant,
v.
Pattilou DAWKINS, Appellee.
No. 07-01-0326-CV.
Court of Appeals of Texas, Amarillo.
May 28, 2002.
Opinion Overruling Rehearing June 27, 2002.
Rehearing Overruled July 22, 2002.
*315 Bob Blinderman, Amarillo, for appellant.
Mullin, Hoard & Brown, David Mullin, Amarillo, for appellee.
Before BOYD, C.J., and REAVIS and JOHNSON, JJ.
JOHN T. BOYD, Chief Justice.
Appellant Ted Wood (Wood) appeals from an ordering granting a take-nothing summary judgment in favor of appellee Pattilou Dawkins (Dawkins) in an action for libel brought against her as a result of a letter she wrote to two newspapers. For the reasons set forth, we affirm the judgment of the trial court.
Dawkins filed a traditional motion for summary judgment under Rule 166a(c) of the Rules of Civil Procedure on the basis that the statements made by her were true, constituted her opinion, and were made in good faith without malice. She also filed a no-evidence motion for summary judgment under Rule 166a(i) on the basis that there was no evidence to show she acted with malice. In his first issue, Wood argues that we should focus on the specific language that is alleged to be defamatory. In his second issue, he contends that summary judgment was improper because the statement is one of fact and he presented evidence that the statement was false, made with malice, and it concerned him.
In reviewing a traditional summary judgment, the movant must show that there is no genuine issue of material fact. Nixon v. Mr. Property Management Co., Inc., 690 S.W.2d 546, 548-49 (Tex. 1985). We take the evidence favorable to the non-movant as true and indulge every reasonable inference in favor of the non-movant. Id. A defendant must disprove as a matter of law one of the essential elements of each cause of action or establish one or more defenses as a matter of law. Randall's Food Markets, Inc. v. Johnson, 891 S.W.2d 640, 644 (Tex.1995).
In reviewing a no-evidence motion for summary judgment, we ascertain if the non-movant produced more than a scintilla of probative evidence to raise a fact issue on the material questions presented. Kimber v. Sideris, 8 S.W.3d 672, 675-76 (Tex.App.-Amarillo 1999, no pet.). When, as in the case before us, the trial court does not state the grounds on which the summary judgment motion is granted, we must affirm it if any ground stated in the motion is meritorious. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex.1989).
*316 Wood, who was Randall County Judge and a member of the Randall County Commission at the time of publication of the alleged libel, complains of a letter to the editor published in The Canyon News editorial opinion page on October 24, 1999.[1] Although the letter contains six paragraphs, it is the first two paragraphs which he contends are libelous. Nevertheless, because Dawkins argues that the first two paragraphs must be viewed in the context of the entire letter as a whole, we will set forth the letter in its entirety:
`Extravagant piece of stupidity'[2]
Here we go again. The Randall County Commissioners and the shifty judge are into subterfuge big time this time!
First, let's talk about the jail. There was not an engineer or architect who believed the new jail could be built for $13 million and the court was told this fact. But since the previous bond issue for a jail had failed and the commissioners court felt a $16 million bond issue would also fail, the solution, they believed, was to lower the amount of the bond issue and worry about the shortfall later. So now they are issuing certificates of obligation. Thank goodness it's only for $3 million. The point is they knew from the gitgo that $13 million wasn't enough!
And now in today's paper I see we're going to renovate and restore the 1909 Courthouse! But we're not going to call it that. The overt name is "facilities expansion." Please, please, when will the Commissioners Court realize that the citizens of Randall County do not want to restore the old courthouse? How many times has this issue been defeated? The north annex is a fine building and the current jail, when empty, will provide more room. Until the new jail is finished, the Norwest building provides enough room. If more space must be had now, then lease something for the time being.
The point I wish to make, however, is that $8.5 million will not begin to cover the cost of doing what they plan on doing and what the county does not need or want! "Skip" Huskey's quote was downright scary. Putting the money "as far as it will go" is tantamount to my mother's saying, "There's no such thing as being a little pregnant." The minute we put another dime in the old building, the state will require that we not only finish what we started, but that we agree to their many stipulations. And even if we do receive funds from the state, $10 million for just one courthouse is probably a more realistic figure. "Pressing" the historical commission to fund the $3 million is laughable. When was the last time a state agency was pressured for money?
And when Commissioner Craig Gualtiere says, "This is not a courthouse issue," he's either lying or is terribly naive. Believe me, the folks in Randall County are not dumb. They see it as it is. The $8.5 million bond issue is for renovating the 1909 courthouse, and should it pass, we will discover halfway through the project, probably after the north annex has been demolished, that the real cost of "facilities expansion" is going to be closer to $15 million.
Did Commissioner Gene Parker do a little survey before he voted on this terribly extravagant piece of stupidity? I'm sure that as the time progresses, the *317 devil will be in the details, and the voters of Randall County will defeat such a senseless waste of money.
Pattilou Dawkins
Amarillo
Wood also alleges Dawkins reaffirmed these statements on KGNC radio.
Initially, Wood posits that, in analyzing the alleged defamatory statement, we should focus on the first two paragraphs of the letter, because to do otherwise would yield a completely different result.[3] He asserts that the first two paragraphs should be taken as a whole in and of themselves, although he recognizes that to determine whether a particular statement within a publication is defamatory, the publication as a whole must be considered. This is necessary, he reasons, because the sentences in those two paragraphs in combination create a false impression, even if individually they do not do so.
An allegedly defamatory statement must be construed as a whole in light of the surrounding circumstances based upon how a person of ordinary intelligence would perceive it. Turner v. KTRK Television, Inc., 38 S.W.3d 103, 114 (Tex.2000); Musser v. Smith Protective Services, Inc., 723 S.W.2d 653, 655 (Tex.1987). A publication can convey a defamatory meaning by omitting or juxtaposing facts, even though each individual statement considered alone might be literally true or non-defamatory. Turner, 38 S.W.3d at 114. This is so because a reasonable person's interpretation depends on the entirety of a publication and not individual statements. Id. at 115. Thus, although a defendant cannot be held liable for presenting a true account of events regardless of what someone might conclude from that account, the same does not hold true when there is an omission of material facts, or a misleading presentation or juxtaposition of true facts. Id. A person claiming defamation based on a publication as a whole must prove the publication's "gist" is false and defamatory. Id.
Wood argues that the gist of the defamatory statement is that "Wood and the other members of the Randall County Commissioners Court knew from the new jail project's very beginning that the jail would cost $16 million but purposely represented the project's cost as being $13 million in order to pass a bond issue."[4] Dawkins focuses on the gist of the letter which she contends is that the Randall County Commissioners had misled the voters on the cost of the new jail and were therefore probably misleading voters on the cost of renovating the old courthouse.
We agree that we should not make our determination based on an examination of each individual sentence in the first two paragraphs to see if each statement standing alone is defamatory, but must examine the two paragraphs together. However, neither may the remainder of the letter be completely ignored because a reasonable person's interpretation of a publication may depend on the context in which the alleged defamatory statement appears (i.e., the first two paragraphs as alleged by Wood). Therefore, it is within that framework that we would conduct our examination of the statement in determining whether it is defamatory.
*318 However, even if the statement was found to be defamatory, to recover for defamation, a public figure or public official must prove that the defamatory statement was made with actual malice. Huckabee v. Time Warner Entertainment Co., 19 S.W.3d 413, 420 (Tex.2000). To establish malice, a plaintiff must prove that the statement was made "with knowledge that it was false or with reckless disregard of whether it was false or not." New York Times v. Sullivan, 376 U.S. 254, 279-80, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964). Reckless disregard is shown by sufficient evidence to permit the conclusion that the author entertained serious doubts as to the truth. St. Amant v. Thompson, 390 U.S. 727, 731, 88 S.Ct. 1323, 20 L.Ed.2d 262 (1968). Neither party disputes that Wood is a public figure.
In support of her motion for summary judgment, Dawkins submitted an affidavit stating that she bore no malice or ill will toward Wood and that everything in her letter was either her sincere opinion or what she believed in good faith to be true and was fully justified by her knowledge at the time. She further averred that she had no serious doubts that the statements she made were true and did not believe any of the statements were false. Additionally, she stated that based on her experience as an owner and developer of commercial real estate, she has found that "building construction almost always costs more than the first estimate-especially if the first estimate does not include plans and bids for construction." She relied on her knowledge that the estimate being used by the Randall County Commission did not include costs for certain items and was not based on actual architectural drawing. Additionally, she relied on public statements by Wood prior to the bond election that the cost of the facility would be $20 million.
Wood contends that, because Dawkins is an interested witness, her affidavit may negate malice as a matter of law only if it is clear, positive, direct, otherwise credible and free from contradictions and inconsistencies and able to be readily controverted. Wood is correct with respect to Dawkins's traditional motion for summary judgment. Huckabee, 19 S.W.3d at 424. However, Dawkins also filed a no-evidence motion for summary judgment with respect to malice, which places the burden on Wood to produce more than a scintilla of probative evidence raising a fact issue as to the existence of malice.[5] Nevertheless, Wood contends that Dawkins has failed to establish the absence of malice as a matter of law, he has controverted her evidence of an absence of malice, and he has presented summary judgment evidence that Dawkins acted with actual malice.
As to evidence that Dawkins acted with malice, Wood specifically points to a citizens committee's report, Dawkins's affidavit and deposition testimony, and the affidavit of Brian Barrett. The citizens committee was appointed to study and make recommendations with respect to the construction of a new Randall County Jail. Dawkins was a member of that committee. The committee's report was provided to the Randall County Commission on December 18, 1997, and recommended the construction of a jail. It was signed by Dawkins as a member. The report showed an estimated cost to construct the jail of $12.46 million. Wood contends this shows Dawkins's statement that no architect *319 or engineer believed the jail could be built for $13 million was false because the report was based on an architect's estimate.
However, it is undisputed that this was an estimate only and that it was not based on actual plans drawn up by the architects[6] and was not shown to include costs associated with compliance on the Texas Commission on Jail Standards. It also did not include costs associated with landscaping, furnishings, and ancillary buildings required by the sheriff's department, for which those items had been left blank in the report. Thus, there is nothing to show that the costs associated with construction of the jail would only be $12.46 million and the fact that Dawkins might have been wrong in her belief that those additional costs would have been more than $13 million or that there might have been an architect or engineer who actually believed the total cost would be less than $13 million is not evidence of malice. It must be shown that Dawkins entertained doubts about her assertion as to what the architects and engineers believed. See Colson v. Grohman, 24 S.W.3d 414, 422 (Tex.App.-Houston [1st Dist.] 2000, pet. denied).
Wood argues that even if the committee report did not show a knowledge of falsity with respect to what other engineers or architects believed, it still shows a knowledge of falsity with respect to her statement that, prior to May 1998, Wood knew that the cost to construct the jail would be $16 million. This is particularly so, Wood contends, in light of the fact that Dawkins's affidavit and deposition testimony shows that she obtained the $16 million figure from a newspaper article published on October 13, 1999, which reported a $3 million increase in the cost of the jail. Dawkins further testified in her deposition that at the time of the May 1998 bond election, Wood and the other commissioners had no idea what the jail was going to cost. In any event, Wood asserts, this evidence is sufficient to raise a fact issue which the jury should determine.
However, it is also undisputed that Wood made statements publicly before the bond election that the jail would be a $20 million project. Although Wood claims he was including financing in those costs, which may be true, that distinction was either not made at all or did not delineate what portion of the $20 million was made up of financing costs, and thus Dawkins could well have believed that Wood knew prior to the bond election that the cost would be higher than $13 million. She also knew by the time of her letter that the costs were in fact at least $16 million. Assuming, without deciding, that the first two paragraphs of Dawkins's letter gave a false impression to the public that Wood knew the cost of the jail would actually be $16 million at the time of the bond election, there is still no evidence that Dawkins did not believe that statement to be true. The presentation of facts may be negligently misleading, but does not establish actual malice unless there is evidence that the author knew or strongly suspected that the publication as a whole was misleading. Turner, 38 S.W.3d at 120. Further, the falsity of a statement alone or a failure to investigate the truth does not show malice. El Paso Times, Inc. v. Trexler, 447 S.W.2d 403, 406 (Tex. 1969); Freedom Communications, Inc. v. Brand, 907 S.W.2d 614, 620, 622 (Tex. App.-Corpus Christi 1995, no writ); Johnson *320 v. Southwestern Newspapers Corp., 855 S.W.2d 182, 188 (Tex.App.-Amarillo 1993, writ denied).
Wood additionally argues that the affidavit of Brian Barrett raises proof of malice. Barrett also served on the citizens committee, and he stated that he believed the estimated cost of $12.46 million to be conservative. Further, when he took office as a Randall County Commissioner on January 1, 1999, he did not anticipate that it would be necessary to borrow any more than $12.46 million to build a jail. However, in September 1999, he was informed by one of the architects that the cost to build the jail would be about $16.2 million, which was the first time he learned the county would need to borrow more money. Even accepting all of these facts as true, they do not raise a fact issue as to malice. The fact that Dawkins and Barrett may have differed in their beliefs as to the cost of the new jail at the time of the committee report, the 1998 bond election, or even during the first part of 1999 does not constitute evidence of malice. Gaylord Broadcasting Co., L.P. v. Francis, 7 S.W.3d 279, 284-85 (Tex.App.-Dallas 1999, pet. denied); American Broadcasting Companies, Inc. v. Gill, 6 S.W.3d 19, 37 (Tex.App.-San Antonio 1999, pet. denied), overruled on other grounds by Turner v. KTRK Television, Inc., 38 S.W.3d 103 (Tex.2000).
Dawkins stated in her affidavit that she based her statements on (1) her past experience with respect to construction costs, (2) her knowledge that certain costs were not included in the estimate, (3) her knowledge the estimate was not based on actual architectural drawings, (4) her understanding that the jail commission had not approved any plans, (5) statements made by Wood prior to the bond election that the cost of the jail facility would be $20 million, and (6) a newspaper article in 1999 that the costs had increased to $16 million. These statements show the basis of Dawkins's belief and, even if wrong, we believe her affidavit is sufficient to negate the element of malice in the absence of controverting evidence. Although the parties quibble over what expenses were actually included at various times by the other party when reference was made to the cost to construct the new jail, those differences in understanding or meaning do not show that Dawkins did not have a reasonable basis for her belief.
Having found that Dawkins's summary judgment may be sustained on the basis that malice does not exist, it is not necessary for us to address Wood's contentions as to the other elements of defamation. Accordingly, we affirm the judgment.
ON MOTION FOR REHEARING
Appellant Ted Wood (Wood) has filed a motion for rehearing of our opinion sustaining a take-nothing summary judgment in favor of appellee Pattilou Dawkins (Dawkins) in Wood's action for libel as a result of a letter written to the newspaper. He complains that we improperly considered evidence and inferences favoring Dawkins, who moved for summary judgment, in determining whether Wood produced more than a scintilla of probative evidence to raise a material fact issue on the question of actual malice. The letter, which is the subject of the libel suit, as well as the history giving rise to the letter, was set forth in our prior opinion and we will not restate it.
In asserting his position, Wood contends that it is well-settled that in reviewing a no-evidence motion for summary judgment, we must "disregard all evidence and inferences that do not favor the non-movant." Wood posits that we failed to look at the evidence favorable to him and instead examined Dawkins's affidavit, as well as *321 her deposition, which was evidence that favored her and should have had no place in our analysis. According to Wood, we also made inferences contrary to Wood's position with respect to the citizen's committee report and made an improper inference that Brian Barrett and Dawkins had differing opinions as to whether Wood knew at the time of the bond election that the jail would cost $16 million.
We noted in our original opinion that Dawkins filed both a traditional motion for summary judgment and a no-evidence motion for summary judgment. Further, the trial court did not state the basis on which the summary judgment was granted, and it therefore must be upheld if any ground is meritorious. Carr v. Brasher, 776 S.W.2d 567, 569 (Tex.1989). We additionally noted that the parties appeared to argue only the merits of the traditional motion for summary judgment in their briefs and, in upholding the summary judgment, we stated that Dawkins's affidavit "negated the element of malice in the absence of controverting evidence," which is the standard for a traditional motion for summary judgment.
Under a traditional motion for summary judgment, the movant must show that there is no genuine issue of material fact. Nixon v. Mr. Property Management Co., Inc., 690 S.W.2d 546, 548-49 (Tex.1985). In determining whether there is a genuine issue of material fact, we are required to take as true evidence favorable to the non-movant and indulge every reasonable inference and resolve any doubts in favor of the non-movant.[1]Id. Further, we may not consider evidence that favors the movant's position unless it is uncontroverted. Putthoff v. Ancrum, 934 S.W.2d 164, 168 (Tex.App.-Fort Worth 1996, writ denied).
It is Wood's position that we should not consider any evidence provided by Dawkins unless it is favorable to him. However, in asserting her traditional motion for summary judgment, the burden is on Dawkins to establish an absence of malice as a matter of law. In Huckabee v. Time Warner Entertainment Co., L.P., 19 S.W.3d 413 (Tex.2000), the defendants filed a traditional motion for summary judgment based on the absence of malice supported by affidavits of employees, which stated they did not believe the subject film contained false statements. The affidavits further provided the facts upon which those persons relied in producing and editing the story. The court stated that the affidavits could negate actual malice as a matter of law only if clear, positive, and direct, otherwise credible and free from contradictions and inconsistencies, and able to be readily controverted. Id. at 424. Further, such affidavits must establish the defendant's belief in the truth of the challenged statements and provide a basis for the belief. Id. The court then went on to consider the affidavits in its analysis. Thus, we are not required to automatically ignore any evidence provided by Dawkins that is not supportive of Wood's position.
As stated in our original opinion, we relied on Dawkins's affidavit that the alleged defamatory statements were based on (1) her past experience with respect to construction costs, (2) her knowledge that certain costs were not included in the estimate of the cost of the jail, (3) her knowledge the estimate was not based on architectural *322 drawings, (4) her understanding that the jail commission had not approved any plans, (5) statements made by Wood prior to the bond election that the cost of the jail facility would be $20 million, and (6) a 1999 newspaper article that the costs had increased to $16 million. Wood has cited no evidence in his motion for rehearing that controverts these facts were the basis for her statements.
However, Wood complains that we improperly inferred that the $12.46 million figure was only an estimate, was not based on actual plans drawn by architects, did not include costs associated with compliance with standards promulgated by the Texas Jail Standards Commission, and did not include costs associated with landscaping, furnishing, and ancillary buildings. Instead, he argues, we should have made the following inferences:
1. The $12.46 million estimate was based on factors commonly used by architects in estimating a new building's cost and was intended to be a number upon which the commissioners court could rely in attempting to obtain financing for the new jail;
2. Although actual plans were not yet drawn, the architect's estimate was the architect's best professional opinion of the new jail's cost and was intended to be a number upon which the commissioners court could rely in attempting to obtain financing for the new jail;
3. Costs associated with compliance with Texas Jail Standards Commission were taken into account by the architects when making their $12.46 million estimate; and
4. Costs associated with landscaping, furnishing, and ancillary buildings were either relatively insignificant or costs that were associated with but not part of the new jail.
Even if we accept these inferences, they do not change our opinion. That is so because even assuming some or all of the underlying factors upon which Dawkins states she relied in making her statements were incorrect or false, that itself is not evidence that the allegedly defamatory statements were made with malice. See Johnson v. Southwestern Newspapers Corp., 855 S.W.2d 182, 185 (Tex.App.-Amarillo 1993, writ denied) (failure to inquire more fully into accuracy of statements is insufficient to show malice).
Nevertheless, Wood asserts that we should have inferred knowledge of falsity from her statement that she obtained the $16 million jail cost figure from a newspaper article published more than a year after the bond election and her testimony that, at the time of the bond election, Wood had no idea what the jail would cost. Further, he claims, we were only able to arrive at the opposite conclusion because we incorrectly gave consideration to the fact that Wood had made statements publicly before the bond election that the jail would be a $20 million project and the fact that, by the time of Dawkins's letter, the jail cost was at least $16 million. The fallacy with this argument is that Wood does not dispute the truth of those facts in his motion for rehearing. He only contends that we may not consider them because they are unfavorable to him. Contrary to his assertion, we did not determine that Wood's evidence had no probative value. We accepted as true the two statements that Wood claims are favorable to him. We also recognize we are required to make reasonable inferences and resolve doubts in favor of the non-movant. However, reasonable inferences cannot be made by ignoring relevant facts that are undisputed by the parties. We believe we are entitled to rely on those undisputed facts that provide a basis for Dawkins's *323 belief that her statements about Wood were true.
Finally, Wood complains that we improperly inferred that Dawkins merely had a different belief than Brian Barrett, who served on the citizens committee, about the cost of the new jail at the time of the committee report and the 1988 bond election. Barrett stated in his affidavit that he believed the $12.46 million estimate to be conservative and did not anticipate any more would have to be borrowed. Barrett became a county commissioner on January 1, 1999, and he did not learn that the jail cost would be $16 million until September 1999, more than a year after the bond election. Wood asserts that if we consider these facts in the light most favorable to him, we would conclude there is some evidence that Dawkins knew he did not believe the jail would cost $16 million at the time of the bond election. Once again, we do not believe that to be a reasonable inference. Accepting these statements as true, they merely recite what Barrett believed from the committee report about the cost of the jail and when he knew it would increase. They do not provide evidence as to what Wood or Dawkins believed about the cost of the jail from the committee report and when they knew the cost would increase.
Based on the factors noted in our original opinion and which we have reiterated again, Dawkins established her belief in the truth of the allegedly defamatory statements and a basis for her belief in their truth. Finding no error in our original disposition of the matter, we overrule appellant's motion for rehearing.
NOTES
[1] The letter was also sent to the Amarillo Daily News, but did not appear in the newspaper.
[2] The title was apparently supplied by the newspaper.
[3] Although couched as Wood's first issue, this is not really a claim of error on the part of the trial court which we are being asked to review, but really is a rule of analysis being urged on us by Wood.
[4] Wood does not complain of the use of the words "shifty" and "subterfuge."
[5] Both parties appear to argue only the merits of the traditional motion for summary judgment in their briefs.
[6] In fact, it is undisputed that, at one of the Randall County Commission meetings, Wood declined to second a motion of one of the other commissioners which would have required the commission to obtain actual plans and specifications before proposing a bond election.
[1] In determining if the non-movant produced more than a scintilla of probative evidence to raise a fact issue in response to a no-evidence motion for summary judgment, we must also consider the evidence in the light most favorable to the party against whom the summary judgment was rendered and disregard all contrary evidence and inferences. Zipp Industries, Inc. v. Ranger Ins. Co., 39 S.W.3d 658, 663 (Tex.App.-Amarillo 2001, no pet.). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588830/ | 972 So.2d 1189 (2007)
Eric JONES, Plaintiff-Appellant
v.
HOLLYWOOD CASINO SHREVEPORT, Defendant-Appellee.
Nos. 42,819-WCA, 42,820-WCA.
Court of Appeal of Louisiana, Second Circuit.
December 5, 2007.
*1190 Eric Jones, In Proper Person.
Law Offices of Ronald F. Lattier by Curtis R. Joseph, Jr., Shreveport, for Appellee, Eldorado Resort Casino Shreveport.
Before STEWART, CARAWAY and PEATROSS, JJ.
STEWART, J.
In this workers' compensation matter, Eric Jones appeals the Workers' Compensation Judge's denial of his claims for temporary total disability benefits (TTD) and supplemental earnings benefits (SEB). For the reasons that follow, we affirm.
FACTS
Eric Jones was an employee with ElDorado Resort Casino, formerly known as Hollywood Casino ("ElDorado"), on September 6, 2003, when he was injured in `a work related accident. Jones continued to receive medical and indemnity benefits even after he was released to return to regular duty on October 10, 2003, until his employment was terminated in December of 2003 for insubordination and other morale related issues. Following his termination, *1191 Jones drew unemployment benefits from December 20, 2003, until January 24, 2004. From September 27, 2004, to December 28, 2004, Jones was paid indemnity benefits by ElDorado.
Following a trial, the WCJ determined that Mr. Jones was entitled to TTD for the period beginning January 30, 2006, through August 26, 2006, at a weekly compensation rate of $282.93, for a total amount of $8,487.90. The WCJ also found that Mr. Jones was entitled to $2,000 in penalties because of ElDorado's failure to provide indemnity payments for the above referenced period. The. WCJ also found that Mr. Jones was entitled to payment, of medical bills generated for treatment rendered by. LSU Health Sciences Center and by Dr. Ken Stanley, pursuant to the fee schedule. However, inasmuch as the evidence did not show that Mr. Jones submitted said bills for payment from ElDorado, the court denied penalties and attorney fees. Moreover, the WCJ denied Mr. Jones' request for TTD or SEB covering several other time periods following his injury. It is the WCJ's denial of benefits that gives rise to the instant appeal by Mr. Jones.
DISCUSSION
Standard of Review
Factual findings in workers' compensation cases are subject to the manifest error or clearly wrong standard of appellate review. The issue to be resolved by the appellate court is not whether the workers' compensation judge was right or wrong, but whether the factual conclusion was reasonable. Accordingly, where there are two permissible views of the evidence, a factfinder's choice between them can never be manifestly erroneous or clearly wrong. Banks v. Industrial Roofing & Sheet Metal Works, Inc., 1996-2840 (La.07/01/97), 696 So.2d 551; Nelson v. City of Grambling, 31,303 (La.App.2d Cir.12/09/98), 722 So.2d 358, writ denied XXXX-XXXX (La.02/26/99), 738 So.2d 588. The question of whether the claimant is entitled to compensation benefits is ultimately a question of fact, and the workers' compensation judge's resolution of that issue may not be disturbed by the appellate court in the absence of manifest error or unless clearly wrong. Nelson, supra.
Temporary Total Disability Benefits
To obtain an award of TTD benefits, a claimant must prove by clear and convincing evidence, unaided by any presumption of disability, that he is physically unable to engage in any employment or self-employment. La. R.S. 23:1221(1)(c); Brantley v. Delta Ridge Implement, Inc., 41,190 (La. App.2d Cir.06/28/06), 935 So.2d 308. This is the standard of proof which a claimant must satisfy when he files a disputed claim form seeking an award of TTD benefits after the employer or insurer terminates voluntary payments of TTD benefits. To prove a matter by clear and convincing evidence, as required to establish entitlement to TTD benefits, means to demonstrate that the existence of a disputed fact is highly probable, i.e., much more probable than its nonexistence. Id.
Jones contended that he was entitled to indemnity benefits from January 25, 2004, until the date of trial with the exception of periods where he was paid benefits. The WCJ divided his claim into several time periods for analysis of eligibility. The first time period was from January 25, 2004, to September 26, 2004, where it was determined that Mr. Jones had no work limitations from any physicians in the *1192 records introduced at trial. However, the record shows that on September 27, 2004, Dr. Pierce Nunley excused the claimant from work until there could be a reevaluation following an MRI. The record indicates that there was a follow up with Dr. Nunley on December 3, 2004, and indemnity was paid to Mr. Jones for the period of September 27, 2004, until December 28, 2004. Because of the lack of evidence, the WCJ properly determined that the claimant failed to establish any entitlement to indemnity benefits from January 25, 2004, to September 26, 2004.
Next, the WCJ considered the time period of December 29, 2004, to January 30, 2006, and determined that there were no medical records indicating a disability or inability of Mr. Jones to work during that period of time. Consequently, he denied Mr. Jones claim for indemnity benefits for that period.
However, the record shows that Dr. Nunley performed surgery on Mr. Jones January 30, 2006. Dr. Nunley then took him off work for six months in a report dated February 23, 2006; thus, the WCJ determined that Mr. Jones was entitled to TTD for the period of January 30, 2006, to August 26, 2006.
Concerning the, time period from August 27, 2006, to December 20, 2006, the WCJ determined that Mr. Jones did not establish by clear and convincing evidence that he was unable to engage in any employment and denied indemnity benefits. He was self employed as a construction worker, but he did not apply for any jobs. We find that Mr. Jones did not meet his burden of proof that he was unable to engage in any employment.
Supplemental Earnings Benefits
When work-related injuries do not result in total disability, but rather leave the employee unable to earn 90% of his preinjury wage, the statute authorizes an award of SEB. La. R.S. 23:1221(3). To prevail on an SEB claim, the employee must meet an initial burden of proving, by a preponderance of the evidence, that her work-related injury has resulted in an inability to earn that amount. Banks v. Industrial Roofing & Sheet Metal, supra; Taylor v. Columbian Chemicals, 32,411 (La.App. 2 Cir. 10/27/99), 744 Sold 704. Only after the claimant makes this prima facie showing does the burden shift to the employer to show that employment is generally available within the claimant's physical limitations and in her or the employer's reasonable geographic region. Id. The WCJ's factual findings on a claim for SEB are subject to the manifest error rule. Seal v. Gaylord Container Corp., 97-0688 (La.12/2/97), 704 So.2d 1161; Taylor v. Columbian Chemicals, supra.
Mr. Jones testified that he had a construction and remodeling company, but he did not apply for any jobs. The WCJ found that there were no records from his physician that indicated that he was unable to work during the period of time at issue. As a result, the WCJ determined that Mr. Jones did not demonstrate that he was unable to earn at least 90 percent of his pre-injury wage. Because Mr. Jones did not meet this burden, it was not necessary for ElDorado to show his wage earning capacity.
The WCJ found that pursuant to La. R.S. 23:1021(10), Mr. Jones was entitled to a presumption of 40 hours and an average weekly wage of $424.40 with a compensation rate of $282.93 and awarded TTD from January 30, 2006, to August 26, 2006. As to the medical benefits, the WCJ found that the January 30, 2006, surgery was causally connected to the September 6, *1193 2003, accident and medically necessary. The WCJ awarded payment of all of the claims of payments to LSU Medical Center and Dr. Ken Stanley, but because those bills were never presented for that treatment, he did not award attorney fees or penalties for failure to pay within 60 days of written notice pursuant to La. R.S. 23:1201(E). However, the WCJ awarded $2,000 because of ElDorado's failure to reasonably controvert the claim for indemnity benefits for the six months following Jones' surgery on January 30, 2006. We find no error in this ruling.
CONCLUSION
Based on the above and foregoing, we affirm the ruling of the WCJ. Costs assessed to Mr. Jones.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588847/ | 61 S.W.3d 912 (2001)
76 Ark.App. 99
Wayne Curtis POORE
v.
Diann POORE.
No. CA 01-510.
Court of Appeals of Arkansas, Division I.
December 5, 2001.
*914 Bullock & Van Kleef, by John D. Van Kleef, Russellville, for appellant.
Peel Law Firm, P.A., by Jennifer L. Modersohn, Russellville, for appellee.
JOHN E. JENNINGS, Judge.
Wayne Curtis Poore appeals from the dismissal of his complaint for divorce in which he sought to end his two-year marriage to appellee, Diann Poore. For reversal, he contends that the chancellor erred in granting her motion for a directed verdict, finding that he had failed to establish grounds for a divorce, and that the chancellor erred in denying his motion for a new trial. We find no error and affirm.
In October 2000, appellant filed a complaint for divorce in Yell County on grounds of general indignities. Appellee answered the complaint and filed a counterclaim for divorce, but she later withdrew her counterclaim and amended her answer to contest appellant's entitlement to a divorce.
At the hearing, appellant testified that their marital problems began in February 2000 when he returned to his former job that required him to travel. He said that he had not been happy with the job he had taken to be closer to home and that he had wanted to go back to the previous job that he had enjoyed. Appellant testified that appellee wanted him to be at home and that his decision hurt and upset her. He said that appellee, who was somewhat older than he, was afraid that he would find someone younger or that he would want children someday. He said that they argued in circles about it every day and that there were times when he would hang the phone up on her or would not go home so as to avoid a fight. Appellant testified that towards the end appellee cursed at him and suggested that he needed counseling. He said that the arguments made him miserable, that he did not want to live a life of constant arguing, and that he did not want to be married to appellee any longer.
Appellee testified that they had discussed appellant's job change but did not argue about it. She said that his decision bothered her because she wanted him to be at home and that she had just told him that she missed him when he was away. Appellee said that his traveling made the marriage difficult for her because she does not like to be alone and would rather have her husband around. She said that they had dated for four years before getting married and that she was not insecure about him finding someone else or wanting children. Appellee testified that she did not want a divorce.
Lonnie Poore, appellant's mother, testified that appellee confided in her that they had been fighting about appellant's job and his being away from home. She said that appellee was worried about appellant cheating on her and that appellee wanted her to talk to appellant about why he was not staying at home. Ms. Poore testified that she witnessed one argument between the two. She said that they stopped talking when she got there but that appellee was crying. Ms. Poore did not feel that there was any way the two of them could get along.
On this evidence, the chancellor granted appellee's motion for a directed verdict in which she argued that appellant had failed to prove or corroborate his grounds for divorce. Appellant challenges this ruling in his first point on appeal.
Divorce is a creature of statute and can only be granted upon proof of a statutory ground. Gunnell v. Gunnell, 30 Ark.App. 4, 780 S.W.2d 597 (1989). Appellant's action for divorce was based on the *915 ground of general indignities. See Ark. Code Ann. § 9-12-301(4) (Repl.1998). In order to obtain a divorce on that ground, the plaintiff must show a habitual, continuous, permanent, and plain manifestation of settled hate, alienation, and estrangement on the part of one spouse, sufficient to render the condition of the other intolerable. Russell v. Russell, 19 Ark.App. 119, 717 S.W.2d 820 (1986). In Bell v. Bell, 105 Ark. 194, 150 S.W. 1031 (1912), the supreme court set out what evidence is necessary to establish indignities as a ground for divorce:
It is for the court to determine whether or not the alleged offending spouse has been guilty of acts or conduct amounting to rudeness, contempt, studied neglect or open insult, and whether such conduct and acts have been pursued so habitually and to such an extent as to render the condition of the complaining party so intolerable as to justify the annulment of the marriage bonds. This determination must be based upon facts testified to by witnesses, and not upon beliefs or conclusions of the witnesses. It is essential, therefore, that proof should be made of specific acts and language showing the rudeness, contempt, and indignities complained of. General statements of witnesses that the defendant was rude or contemptuous toward the plaintiff are not alone sufficient. The witness must state facts-that is, specific acts and conduct from which he arrives at the belief or conclusion which he states in general terms-so that the court may be able to determine whether those acts and such conduct are of such nature as to justify the conclusion or belief reached by the witness. The facts, if testified to, might show only an exhibition of temper or of irritability probably provoked or of short duration. The mere want of congeniality and the consequent quarrels resulting therefrom are not sufficient to constitute that cruelty or those indignities which under our statute will justify a divorce.
Id. at 195-196, 150 S.W. at 1032 (emphasis supplied). Although Bell was decided long ago, it remains the law that mere incompatibility is not grounds for divorce in this state. See Wiles v. Wiles, 246 Ark. 289, 437 S.W.2d 792 (1969); Settles v. Settles, 210 Ark. 242, 195 S.W.2d 59 (1946); Hair v. Hair, 270 Ark. 948, 607 S.W.2d 72 (Ark. App.1980).
A directed verdict is only proper where the evidence, when viewed in the light most favorable to the nonmovant, is so insubstantial as to require a jury verdict for the movant to be set aside. Potlatch Corp. v. Triplett, 70 Ark.App. 205, 16 S.W.3d 279 (2000). On appeal from a chancery court's order granting a directed verdict, the court on appeal must decide specifically whether the plaintiff has made out a prima facie case of entitlement to the relief requested. Jamison v. Estate of Goodlett, 56 Ark.App. 71, 938 S.W.2d 865 (1997). This requires that the evidence presented by the plaintiff must be given the highest probative value, taking into account all reasonable inferences therefrom. Potlatch Corp. v. Triplett, supra.
Appellant's proof, given its highest probative value, showed that the parties had fallen into disagreement over appellant's decision to return to a job that kept him away from home. As we have pointed out, however, mere uncongeniality and quarrelsomeness, without more, are not sufficient to sustain a charge of general indignities. See, e.g., Wiles v. Wiles, 246 Ark. 289, 437 S.W.2d 792 (1969); Settles v. Settles, 210 Ark. 242, 195 S.W.2d 59 (1946); Bell v. Bell, supra; Hair v. Hair, 270 Ark. 948, 607 S.W.2d 72 (Ark.App.1980). The conduct complained of must show settled hate and a manifestation of alienation and *916 estrangement, and it must have been conducted systematically and habitually over a period of time as to make the complaining party's condition in life intolerable. See Settles v. Settles, supra; Hair v. Hair, supra. We think that the chancellor could reasonably conclude that appellant failed to make a prima facie case of general indignities, and we find no error in his granting a directed verdict.
Appellant next argues that the trial court erred in denying his motion for a new trial. In his motion, appellant alleged that appellee had not been truthful in her testimony concerning the withdrawal of her counterclaim, as evidenced by her having filed a complaint for divorce in Faulkner County the day before the hearing. He argued that her chicanery entitled him to a new trial for fraud under Ark. R. Civ. P. 60(c)(4). We find no error. Appellee's testimony on that subject could have had no possible effect on the outcome of the trial. With or without her testimony, appellant's proof of grounds for divorce was insufficient.
Affirmed.
BIRD and ROAF, JJ., agree. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588854/ | 783 N.W.2d 594 (2010)
280 Neb. 1
Dorothy L. BAUERMEISTER et al., appellees,
v.
WASTE MANAGEMENT CO. OF NEBRASKA, INC., appellant, and
Nature's Works, LLC, et al., appellees.
No. S-09-019.
Supreme Court of Nebraska.
June 18, 2010.
*595 Thomas A. Grennan and Francie C. Riedmann, of Gross & Welch, P.C., L.L.O., and Ronald R. Volkmer, of McGill, Gotsdiner, Workman & Lepp, Omaha, for appellant.
David A. Domina, of Domina Law Group, P.C., L.L.O., Omaha, and Matt R. Deaver, of Deaver Law Office, for appellees Dorothy L. Bauermeister et al.
HEAVICAN, C.J., WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.
MILLER-LERMAN, J.
NATURE OF THE CASE
In this case on further review, Fred and Dorothy L. Bauermeister and Richard and Clara E. Deaver sought to repurchase their land from Waste Management Co. of Nebraska, Inc. (Waste Management), pursuant to the "Seller's Option to Buy" clause in the purchase agreement. The district court for Douglas County concluded that the clause was enforceable and quieted titled in favor of Fred, Dorothy, Richard, and Clara. On appeal, the Nebraska Court of Appeals concluded that because the option violated the rule against perpetuities, it was void, and reversed the order of the district court. On further review, we conclude that because the rule against perpetuities is inapplicable to this contractual option, the option is enforceable. We therefore reverse the ruling of the Court of Appeals and remand with directions to consider the remaining assignments of error.
STATEMENT OF FACTS
The following facts, which are supported by the record, come largely from the memorandum opinion of the Court of Appeals. See Bauermeister v. Waste Mgmt. Co., No. A-09-019, 2009 WL 6473172 (Neb.App. Dec.8, 2009) (selected for posting to court Web site). On March 22, 1989, Fred, Dorothy, Richard, and Clara executed a purchase agreement, pursuant to which Waste Management purchased 280 acres of separately owned but contiguous tracts of real property in Douglas County, Nebraska. Waste Management purchased the property to develop a landfill site, and the property was so used by Waste Management from 1989 until 2003.
In the agreement, the word "Seller" referred to Fred, Dorothy, Richard, and Clara and their heirs, successors, and assigns, and the word "Purchaser" referred to Waste Management. The purchase agreement between the parties contained a "Seller's Option to Buy," in paragraph 30, which stated:
If Seller(s), their successors or heirs so choose, Seller(s) shall have the option to repurchase all or any portion of the Premises from Purchaser in consideration for the sum of One Dollar ... at the termination, for any reason, of this Agreement, and Purchaser shall be obligated to sell the Premises to Seller(s), their successors or heirs, if they so choose. Seller's option may be exercised from the date of termination of the Landfill until two years after the date of termination of the required monitoring of the Landfill pursuant to Paragraph 16.
Separate option agreements were executed evidencing the parties' agreement and for recordation purposes. The agreement also provided at paragraph 20 that Fred, Dorothy, Richard, and Clara could sell the options, upon the same conditions *596 as enjoyed by them, upon satisfactory notice to Waste Management.
Fred died in 2004, and on April 6, 2005, Dorothy, as trustee of Fred's trust, executed an "Instrument of Distribution of Personal Property" conveying the interest in the Waste Management purchase agreement and option to Fred and Dorothy's sons, subject to Dorothy's life use.
Richard died in 2002. Clara was named in Richard's will as his personal representative, and his estate was closed in 2007. Clara died during these proceedings, and the case was revived.
In 2003, Waste Management discontinued using the land at issue as a landfill, which prompted the required monitoring time period as discussed in the option set forth above. Pursuant to federal and state laws, a landfill's postclosure care and monitoring must begin after a landfill is closed and continues for 30 years after that closure date.
On August 31, 2006, Dorothy and Clara signed a document entitled "Notice of Intent to Exercise Seller's Option to Buy." The notice attempted to put Waste Management on notice that Dorothy, in her own behalf and as surviving spouse of Fred, and Clara, in her own behalf and as surviving spouse of Richard, were jointly and severally exercising the option to repurchase the land pursuant to the purchase agreement with Waste Management. Waste Management took the position that the "Seller's Option to Buy" was not properly executed, and did not deliver the deed to the land to either Dorothy or Clara.
On October 17, 2006, Dorothy and Clara filed a complaint in the district court for Douglas County seeking specific performance and an accounting. Dorothy and Clara alleged that they had properly executed the option to repurchase and that Waste Management was obligated to execute the deed for the land back to them. Waste Management denied the allegations in the complaint and alleged that Dorothy and Clara were not the real parties in interest.
On October 18, 2007, Dorothy and Clara made a second attempt to exercise the option to repurchase by sending three letters to Waste Management. In late 2007, Dorothy, Fred and Dorothy's sons, and Clara (collectively appellees) filed an amended complaint in the district court for specific performance, accounting, quiet title, and declaratory judgment. Waste Management answered and, inter alia, asserted affirmative defenses, including that some or all of the appellees were not real parties in interest or lacked standing, the option to repurchase was void because it violated the common-law rule against perpetuities, and the amended complaint failed to state a claim upon which relief could be granted.
A trial was held. The district court entered an order filed December 10, 2008, in which it determined that Dorothy and Clara, and their heirs, clearly intended to exercise the option to repurchase in each of their respective capacities and that therefore, as real parties in interest, they had validly exercised the option. The district court ordered Waste Management to immediately convey title to the land through a warranty deed back to appellees. The district court found no merit to Waste Management's affirmative defenses. Accounting issues are the subject of another action. Waste Management appealed.
On appeal, the Court of Appeals concluded that the "Seller's Option to Buy," sought to be exercised by appellees, violated the rule against perpetuities and was void. Because resolution of this issue invalidated the option and resolved the case, the Court of Appeals did not reach the remaining assignments of error. The *597 Court of Appeals reversed the order of the district court. Appellees petitioned for further review, which this court granted.
ASSIGNMENT OF ERROR
In their petition for further review, appellees claim, restated and summarized, that the Court of Appeals erred by concluding that the option to repurchase was void under the common-law rule against perpetuities.
STANDARD OF REVIEW
When reviewing questions of law, an appellate court has an obligation to resolve the questions independently of the conclusion reached by the lower court. See Kuhn v. Wells Fargo Bank of Neb., 278 Neb. 428, 771 N.W.2d 103 (2009).
ANALYSIS
For purposes of our review, the sole issue before this court is whether the rule against perpetuities invalidates the option to repurchase in the agreement between appellees and Waste Management. The Court of Appeals concluded that because the agreement was signed a few months prior to the effective date of the Nebraska statutory rule against perpetuities, this case is governed by the common-law rule against perpetuities. The parties do not dispute this conclusion, and we agree that the common law governs.
As an initial matter, we note that the common-law rule against perpetuities prohibits the creation of future interests or estates which, by possibility, may not become vested within a life or lives in being and 21 years, together with the period of gestation when necessary to cover cases of posthumous birth. In re Trust Estate of Darling, 219 Neb. 705, 365 N.W.2d 821 (1985). It has been observed that the rule is based on the public policy against restricting the alienability of land. See Stuart Kingston, Inc. v. Robinson, 596 A.2d 1378 (Del.1991).
In deciding this case, the Court of Appeals understandably relied on our opinion in Rice v. Lincoln & N.W.R. Co., 88 Neb. 307, 129 N.W. 425 (1911). Rice, however, was decided nearly a century ago, and that portion of Rice to which the Court of Appeals referred was dictum. Rice suggested that the rule against perpetuities would be applicable to an option under certain facts.
Relying on Rice, the Court of Appeals determined that the lives in being at the creation of the option, which is the future interest at issue in this case, were Fred, Dorothy, Richard, and Clara and that the option also could be exercised by their "successors or heirs." The Court of Appeals stated that the inclusion of the successors or heirs "ensures that there is a possibility that the option to purchase would reach beyond the [Seller's] death and 21 years, thus violating the rule against perpetuities and rendering the option void." Bauermeister v. Waste Mgmt. Co., No. A-09-019, 2009 WL 6473172 at *4 (Neb.App. Dec.8, 2009) (selected for posting to court Web site).
The Court of Appeals further observed that the language limiting the option to 2 years after the date of termination of the required monitoring of the landfill did not prevent the option from violating the rule against perpetuities. The Court of Appeals noted that the evidence showed federal and state regulations require a 30-year landfill postclosure monitoring period and reasoned that because the option gave the "Seller" an additional 2 years after the monitoring period to exercise the option, the total duration of the option in this case was extended to 32 years.
On further review, appellees, as sellers and holders of the option to repurchase, *598 argue that the decision by the Court of Appeals should be reversed because the modern trend in the common law applicable to this case, with respect to the application of the rule against perpetuities to contractual options, is to avoid strict application of the rule. Appellees suggest the better reasoned cases show that the rule against perpetuities is not appropriately applied to options and that effectuation of the parties' intentions to create a commercially viable and enforceable option is sound law. Appellees also note that the option at issue can be sold, which shows that its objective was commercial in nature and not donative. Waste Management argues that the rule against perpetuities applies to options and that the option contained in the purchase agreement is void. Accordingly, Waste Management urges us to affirm the ruling of the Court of Appeals. For the reasons explained below, we reverse the decision of the Court of Appeals.
Our analysis is informed by reviewing the context and timeframe during which the option at issue in this case was negotiated by the parties. The option was created in a contract signed and agreed to by the parties in March of 1989. In the agreement, Fred, Dorothy, Richard, and Clara agreed to sell 280 acres of their land to Waste Management to develop as a landfill. Paragraph 30 of the agreement included the "Seller's Option to Buy," stating in relevant part that
Seller(s) shall have the option to repurchase all or any portion of the Premises from Purchaser in consideration for the sum of One Dollar. ... Seller's option may be exercised from the date of termination of the Landfill until two years after the date of termination of the required monitoring. ...
Paragraph 20 of the agreement provides that the "Seller" had the right to sell the option if "such purchaser, transferor or lienholder takes, subject to all terms and conditions of this Agreement," and Waste Management is provided proper notice. Separate option agreements were also signed.
Subsequent to the execution of the agreement, and the separate option agreements, the Nebraska version of the Uniform Statutory Rule Against Perpetuities Act (Act) became effective. See Neb.Rev. Stat. §§ 76-2001 through 76-2008 (Reissue 2009). The effective date of the Act was about 5 months after the option at issue was agreed upon. The Act excluded from the rule's coverage options such as the one in this case. See § 76-2005(1) (stating that rule against perpetuities does not apply to "[a] nonvested property interest or a power of appointment arising out of a nondonative transfer"). The Act has been widely adopted. After the enactment of the Act elsewhere, a California appellate court succinctly stated, "The rule is now irrelevant to [commercial] transactions...." Shaver v. Clanton, 26 Cal. App.4th 568, 574, 31 Cal.Rptr.2d 595, 598 (1994). The California court explained the purpose of this exclusion by citing commentators as follows:
"It makes no sense to apply a rule based on family-oriented donative transfers to interests created by contract whose nature is determined by negotiations between the parties." [See Recommendation Relating to Uniform Statutory Rule Against Perpetuities, 20 Cal. Law Revision Com. Rep. (1990) 2501, 2516.] "The rationale for this exclusion is that the rule against perpetuities is a wholly inappropriate instrument of social policy to use as a control over such arrangements. The period of the rule a life in being plus 21 years is not suitable for nondonative transfers. ..." (1991 Addition to Law Revision Com. Com., 54A *599 West's Ann.Prob.Code § 21225 (1994 pocket supp.) p. 60....
Shaver, 26 Cal.App.4th at 574, 31 Cal. Rptr.2d at 598.
The provision in the Act excluding the application of the rule against perpetuities to commercial options was the logical outcome of years of jurisprudence critical of applying the rule against perpetuities to commercial transactions. As early as 1952, one commentator stated that applying the rule to options completely disregards the purpose of the rule, namely, to prevent extraordinarily protracted family settlements and devolution of decedents' estates. See W. Barton Leach, Perpetuities in Perspective: Ending the Rule's Reign of Terror, 65 Harv. L.Rev. 721 (1952).
In a similar vein, the Restatement (Third) of Property: Servitudes § 3.3, comment b. at 428 (2000), explains as follows:
In the late 19th century, ... courts began to apply [the rule against perpetuities] to commercial land transactions, including options [and] rights of first refusal. ... The virtue of the rule was that it invalidated all interests that lacked a durational limit, thus clearing titles without any need to inquire into the utility of the arrangement. Its vice was that it operated arbitrarily, applying a time period totally unsuited to commercial transactions. ...
Although commentators had long complained that the rule against perpetuities should not be applied to commercial transactions, it was not until the 1980s that courts in any number followed suit.
In Pathmark Stores v. 3821 Associates, L.P., 663 A.2d 1189 (Del.Ch.1995), the Delaware Court of Chancery determined that the rule against perpetuities was not offended by the contractual option at issue in that case. In support of its conclusion, the Delaware court referred to various commentators and stated:
The application of the rule against perpetuities to options is subject to severe criticism. See VI Thomas E. Atkinson et al., American Law of Property § 24.56 at 141 (A. James Casner ed. 1952) ("The application of the rule against perpetuities to options was a step of doubtful wisdom."); Lewis M. Simes et al., The Law of Future Interests § 1244 at 159 (2d ed. 1956) ("As an original proposition, it might have been better for the courts to hold that all option contracts are outside the rule against perpetuities."); see also T. Bergin et al., Preface to Estates in Land and Future Interest at 207-08 (2d ed. 1984) ("[T]he rule against perpetuities is obviously not suited to the commercial transaction.").
Pathmark Stores, 663 A.2d at 1192-93.
The Delaware court further noted:
The common law rule against perpetuities time period, lives in being plus twenty-one years, is well suited for keeping family transfers of property within a reasonable time period. This common law time period is tied to notions of when a person will attain the age of majority. Commercial transactions, however, have absolutely no tie to either lives in being or twenty-one years.
Id. at 1193.
Reflecting this evolution recounted above, the Restatement, supra, determined that the rule against perpetuities is inapplicable to options to repurchase such as the one at issue in this case.
As noted, the Legislature enacted the Act in 1989. The Act demonstrates the policy adopted by the Legislature, and pursuant to the Act, the option at issue would not be subject to the rule against perpetuities. The Act adopted in Nebraska *600 reflected the scholarly opinion and jurisprudence which had evolved over the decades prior to its passage. The instant case is our first opportunity to comment on the application of the rule against perpetuities to a commercial option since passage of the Act. We conclude that the application of the common-law rule against perpetuities which governs this case is no broader than that imposed by the statutory rule enacted by the Legislature, and thus, the option at issue is not subject to the rule against perpetuities. Our decision is consistent with the courts and commentators, noted above, who have observed that the purposes supported by the rule against perpetuities do not logically apply to commercial transactions such as options.
There are sound public policy reasons which support the conclusion that contractual options to repurchase, such as the one at issue in this case, are not subject to the rule against perpetuities. The option at issue is the result of a commercial transaction. It is more appropriately analyzed "based upon the realities of commerce in land, not upon a borrowing from the law of family settlements." VI Thomas E. Atkinson et al., American Law of Property § 24.56 at 142 (A. James Casner ed.1952). In Pathmark Stores v. 3821 Associates, L.P., 663 A.2d 1189, 1193 (Del.Ch.1995), the Delaware Court of Chancery stated:
It would be inequitable to declare this option void ab initio. Two commercial entities have bargained for the option to repurchase, each presumably gaining and losing contractual advantages during the negotiation process to reach this agreement. Here Pathmark not only attempts to exercise the option within the duration of the option, but even within the time limit required by the common law rule against perpetuities. Allowing defendants to escape the terms of the contract because Pathmark might exercise the option in an unreasonably remote way defies the contract's terms, logic, common sense, public policy and principles of equity.
The same reasoning applies to the instant case.
It would not be prudent to now deny appellees the benefit of their bargain while allowing Waste Management to avoid the terms of the agreement. In concluding that the rule against perpetuities does not apply to this option, we merely hold the parties to the terms of their contractual arrangement. Based on the foregoing, we reverse the decision of the Court of Appeals.
CONCLUSION
Because we conclude that the common-law rule against perpetuities is inapplicable to the option at issue, we reverse the decision of the Court of Appeals and remand with directions to consider the remaining assignments of error not previously considered by the Court of Appeals.
REVERSED AND REMANDED WITH DIRECTIONS. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1588858/ | 972 So.2d 188 (2008)
CASTILLO
v.
BDP INTERN. FINANCE CORP., LTD.
No. 3D06-2959.
District Court of Appeal of Florida, Third District.
May 30, 2007.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1709605/ | 497 So. 2d 790 (1986)
HUEY T. LITTLETON CLAIMS SERVICE, INC. and Huey T. Littleton, Plaintiffs-Appellees,
v.
John McGUFFEE, Defendant-Appellant.
No. 85-1190.
Court of Appeal of Louisiana, Third Circuit.
November 5, 1986.
*791 L.H. Olivier, Lafayette, for defendant-appellant.
Woodley, Barnett, Williams, Fenet, Palmer & Pitre, Robert W. Fenet, Lake Charles, for plaintiffs-appellees.
Before GUIDRY, DOUCET and KING, JJ.
GUIDRY, Judge.
Plaintiffs, Huey T. Littleton Claims Service, Inc. and Huey T. Littleton, individually (hereafter Littleton), filed the instant suit against defendant, John McGuffee, an ex-employee of Littleton, seeking injunctive relief and damages under La.R.S. 51:1401 et seq., the Louisiana Unfair Trade Practices and Consumer Protection Law. Only the injunction portion of the suit is at issue here.
Following a hearing, the trial court, on July 12, 1985, issued a minute entry detailing its reasons for judgment, and subsequently on July 16, 1985, judgment in favor of plaintiffs and against defendant, granting a permanent injunction was signed. That judgment reads in pertinent part:
"IT IS ORDERED, ADJUDGED AND DECREED that respondent's actions in taking LITTLETON'S confidential client lists is in direct violation of the Louisiana Unfair Trade Practices Act, LSA-R.S. 51:1401, et seq.
IT IS FURTHER ORDERED, ADJUDGED AND DECREED that McGUFEE is permanently enjoined from making any use whatsoever of any client lists or any trade secrets of HUEY T. LITTLETON CLAIMS SERVICE, INC. or HUEY T. LITTLETON, INDIVIDUALLY."
*792 In his reasons for judgment, the learned trial judge explained his order thusly:
"The Respondent was employed as manager of the Lafayette branch office of Huey T. Littleton Claims Service, Inc. While employed by Relator he successfully solicited clients of his employer. The Court deems this a breach of his feduciary [sic] duty owed to his employer as well as a violation of the Unfair Trade Practices Act, LSA-R.S. 51:1401 et seq; NCH Corporation vs. Lynn N. Broyles, 749 F.2d 247 (1985); Dufau vs. Creole Engineering, Inc., 465 So2d 752 (La.App. 5th Cir.1985).
Respondent's actions in taking Relator's confidential client lists was in direct violation of LSA-R.S. 51:1405. The Court hereby enjoins Respondent from making use of any of the aforementioned lists or any trade secrets of Relator.
Insofar as the customers McGuffee converted, the Court cannot enjoin Respondent from doing business with them. Much of the harm resulting from defendant's alleged misappropriation has already been suffered by plaintiff. Defendant has returned his customer list and will not have access to future lists. The Court cannot enjoin the defendant from servicing the customers he has alienated from the plaintiff. NCH Corp. vs. Broyles, supra."
Defendant, McGuffee, appealed the July 16, 1985 judgment. Although appellant lists six assignments of error, we can dispose of all six by considering the three following issues:
1. Did defendant breach a fiduciary duty to Littleton?
2. If so, did appellant's actions constitute a violation of R.S. 51:1401 et seq?
3. Did the district court err in granting the permanent injunction?
The following facts are undisputed. Plaintiffs have been engaged in the business of insurance adjusting and appraisal service, representing insurance companies and self-insureds, for a period of twenty years. For at least two years prior to June 12, 1985, the day he resigned, John McGuffee managed plaintiffs' Lafayette office. During the last week of May 1985, McGuffee traveled to New Orleans to see a Mr. Bruce Walker, the manager of the Marine Claims Department of I.N.A., on Littleton business. While at a business lunch with Mr. Walker, McGuffee inquired, "Bruce, if I should go into business for myself how would that affect our relationship?" According to McGuffee, Walker answered: "None, I'll continue to assign files to you, we would like for you to continue working the files ...".
Defendant-appellant also admitted that on June 11, 1985, he traveled to Houston, Texas, again on Littleton business, to see, among others, Mr. George Hargrove. McGuffee, when questioned about his meeting with Mr. Hargrove, stated:
"... The purpose of me meeting with Mr. Hargrove was, and I think the way I phrased the question to him was `George, I'm considering going into business for myself. How would that affect our relationship, working relationship?' He responded that, `It won't have any affect on it, we like your work, if you want to go into business for yourself we'll be glad to continue to send you work as we have in the past,' and then I asked, `Well, what about existing files.' He said, `Well, I would prefer that you would continue to work on those existing files to provide continuity, we're in the process of settling some, they're in maintenance, blah, blah, blah,' and that's what took place...."
The following morning, June 12, 1985, McGuffee resigned from the employ of plaintiffs, copied and removed approximately sixty files and forty-five "Rolodex" cards from plaintiffs' office over the objection of Mr. Littleton and started his own business. In a heated discussion over the removal of these copies, McGuffee informed Littleton that he had been in contact with various clients of plaintiffs and had received the clients' permission to make copies of their files and take them with him to his new business.
The Louisiana Unfair Trade Practices and Consumer Protection Law is relatively *793 new, having been enacted by the legislature in 1972. Since its inception, the courts have been called upon many times to interpret its provisions. In Roustabouts, Inc. v. Hamer, 447 So. 2d 543 (La.App. 1st Cir. 1984), the court stated:
"The Louisiana Unfair Trade Practices and Consumer Protection Law declares unlawful unfair methods of competition and unfair acts or practices in the conduct of any trade or commerce. LSA-R.S. 51:1405 A. Private actions are permitted by any person who suffers any ascertainable loss as a result of the use by another person of an unfair practice, and if the actions are successful, the trial judge shall award reasonable attorney's fees to the prevailing party. LSA-R.S. 51:1409 A. Of importance is the fact that the term person is defined in LSA-R.S. 51:1402(8) to include corporations as well as natural persons.
... [A]s we stated in Guste v. Demars, 330 So. 2d 123, 125 (La.App. 1st Cir.1976):
The substantive prohibition of the Unfair Trade Practices and Consumer Protection Law is broad and does not specify particular violations. La.R.S. 51:1405(A) declares that:
"Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are declared unlawful."
The language of this section tracks closely that of the Federal statute, 15 U.S.C. Section 45(a). Because of the variety of possible unfair and deceptive practices, the Federal statute was intentionally broadly written, leaving the determination of individual violations to the Commission and the courts. Our legislature has expressed a similar intention in patterning our law so closely on the Federal statute.
. . . . .
It should be noted that the private right of action in the Louisiana law is not provided for in the Federal scheme. But more importantly, consistent with the definition of person cited above, it has been held that the language of LSA-R.S. 51:1409 A confers the private right of action on both consumers and business competitors. Morris v. Rental Tools, Inc., 435 So. 2d 528 (La.App. 5th Cir. 1983). Furthermore, it has been stated that a practice is unfair when it offends established public policy and when the practice is unethical, oppressive, unscrupulous, or substantially injurious to consumers and consumers include business competitors...."
Defining "unfair methods of competition and unfair or deceptive acts or practices" has in the past and continues to prove troublesome. A panel of this court in Lamb v. Quality Inspection Serv., Inc., 398 So2d 643 (La.App. 3rd Cir.1981), pronounced:
"What constitutes unfair competition is a matter to be decided in each individual case and involves a balancing between the right of the employee to individual freedom on the one hand and the right of the employer to honest and fair competition and to protection of business assets and property in the nature of trade secrets on the other hand. National Oil Service of Louisiana, Inc. v. Brown, 381 So. 2d 1269 (La.App. 4 Cir.1980).
The courts, in addition, have always stood ready to grant injunctive relief to protect valuable `trade secrets' property. Marcann Outdoor, Inc. v. Johnston, 229 So. 2d 419 (La.App. 3 Cir.1969).
Various efforts have been made to define what is a `trade secret'. The tests applied include: (1) is the information a secret not generally known to the trade; (2) although absolute secrecy is not essential, has it been kept at least a qualified secret; and (3) is it of value. Standard Brands, Inc. v. Zumpe, 264 F. Supp. 254 (E.D.La.1967)."
The law recognizes that, at some point, an employee may wish to leave his position and "try his hand" at competing with his former boss, free enterprise being the cornerstone of American democracy. While a former employee's right to compete must be protected, so must the right of the existing business to fair play be maintained.
In Engineered Mechanical Services v. Langlois, 464 So. 2d 329 (La.App. 1st Cir. *794 1984), writ denied, 467 So2d 531 (La.1985), the court found that:
"...
even in the absence of a restrictive covenant not to disclose confidential information, trade secrets will be protected where a confidential relationship exists. Wheelabrator Corporation [v. Fogle] 317 F.Supp. [633] at 637; Standard Brands, Inc., 264 F.Supp. at 262; Comment, Agreements Not to Compete, 33 La.L.Rev. 94 (1972); See also, Holliday, Jr. and Norman, Employment Contracts: A Checklist for the Draftsman, 31 La.B.J. 12 (1983). This rule is based on the principle that unfair methods of competition are against public policy and the agency principle that an employee (agent) has a duty not to use or communicate information given to him in confidence in competition with or to the injury of the employer (principal) unless the information is a matter of general knowledge. Standard Brands, Inc., 264 F.Supp. at 262; National Oil Services of Louisiana, Inc., 381 So.2d at 1273. Such a wrongful disclosure or use of a trade secret is considered a breach of trust or confidence."
(Emphasis ours).
National Oil Service of Louisiana, Inc. v. Brown, 381 So. 2d 1269 (La.App. 4th Cir. 1980), tells us that:
"A former employee who enters business in competition with his former employer necessarily utilizes the experience he acquired and the skills he developed while in his former employment. While the employer may by contract obtain limited protection against competition from former employees, by law he may be entitled to protection against wrongful appropriation and use by former employees of things specially developed by the employer in his business, such as lists of customers (particularly in route sales) whose regular patronage has been acquired by the employer's advertising, solicitation and organized effort. Considerations as to the type of protection to be afforded to the employer in a specific case include the manner in which and the purpose for which customer lists are compiled; the conduct and motivation of the employee before and after termination of the employment; the manner in which the customers are contacted after the termination and the nature of the representations made to the customer by the former employee; and the existence of a scheme to take over all or a substantial part of the former employer's business, or of an intent to injure the former employer's business."
(Emphasis ours).
Finally, the court in Dufau v. Creole Engineering, Inc., 465 So. 2d 752 (La.App. 5th Cir.1985), writ denied, 468 So. 2d 1207 (La.1985), stated:
"The solicitation and diversion of an employer's customers prior to termination constitutes unfair competition entitling the plaintiff to recover damages. As stated by the trial court, `an employee owes his employer a duty to be loyal and faithful to the employer's interest in business'."
From the facts in this case, it is crystal clear that defendant, John McGuffee, violated La.R.S. 51:1401, et seq. by soliciting his employer's customers prior to resigning. We further agree with the trial court's conclusion that his actions in soliciting Littleton customers and copying Littleton customer lists, the Rolodex cards, which Littleton testified were confidential and the result of many years of solicitation and effort, constituted a breach of McGuffee's fiduciary duty to his employer.
We find no error in the trial court's action of permanently enjoining appellant from making use of the information he obtained from his former employer by unethical and unscrupulous means.
Accordingly, for the reasons stated, the judgment appealed from is affirmed. All costs of this appeal are to be borne by appellant.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3337509/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]MEMORANDUM OF DECISION ON DEFENDANT'S MOTION TO DISMISS
After review of the affidavits and memoranda of law submitted by the parties, as well as oral argument, the court concludes as follows:
1. Under Section 52-59b(a)(1), jurisdiction over the defendant is properly asserted because the defendant over the past several years has engaged in purposeful Connecticut related activity, and therefore has transacted business within Connecticut. (See Plaintiff's Affidavit).
2. The requisite minimum contacts between the defendant and Connecticut exist. They are such that requiring the defendant to defend the plaintiff's claims in Connecticut does not offend traditional notions of fair play and substantial justice.
The Court has analyzed the affidavits and concludes that the circumstances of this case are such that the defendant's involvement with Connecticut would reasonably lead him to anticipate that he would be "haled into court" there. The court further finds that bringing the defendant personally under the jurisdiction of the Connecticut court would not put him at a severe disadvantage in comparison with the plaintiff.
The plaintiff has established her burden of proving the court's jurisdiction. The defendant's constitutional due process rights are not violated by Connecticut having personal jurisdiction over him in this case.
HON. RICHARD A. WALSH, J. CT Page 5316-XXXX | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4558360/ | Fourth Court of Appeals
San Antonio, Texas
August 21, 2020
No. 04-20-00251-CR
The STATE of Texas,
Appellant
v.
James QUON,
Appellee
From the County Court, Kinney County, Texas
Trial Court No. 10209CR
Honorable Tully Shahan, Judge Presiding
ORDER
On July 27, 2020, the State filed a motion for extension of time to file the State’s brief
until August 31, 2020 on the basis that the State was awaiting a supplemental clerk’s record. On
August 17, 2020, this court ordered the trial court clerk to file the supplemental clerk’s record by
August 31, 2020. In light of this court’s prior order, the State’s motion for extension is
GRANTED as follows: the State’s brief is due no later than September 30, 2020. Further
requests for extension of time to file the State’s brief will be disfavored.
_________________________________
Sandee Bryan Marion, Chief Justice
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said
court on this 21st day of August, 2020.
___________________________________
MICHAEL A. CRUZ,
Clerk of Court | 01-03-2023 | 08-25-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3035740/ | FILED
NOT FOR PUBLICATION MAR 30 2010
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
JOHN B. FREEMAN, an individual, No. 08-35634
Plaintiff - Appellant, D.C. No. 2:07-cv-01510-BHS
v.
MEMORANDUM *
THOMAS WHITTINGTON BERGAN
AND STUDEBAKER INC. PS, Law Firm;
et al.,
Defendants - Appellees.
Appeal from the United States District Court
for the Western District of Washington
Benjamin H. Settle, District Judge, Presiding
Submitted March 16, 2010 **
Before: SCHROEDER, PREGERSON, and RAWLINSON, Circuit Judges.
John B. Freeman appeals pro se from the district court’s judgment
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
JK/Research
dismissing his action challenging a state court writ of garnishment against him.
We have jurisdiction under 28 U.S.C. § 1291. We review de novo. Noel v. Hall,
341 F.3d 1148, 1154 (9th Cir. 2003). We may affirm on any ground supported by
the record. O’Guinn v. Lovelock Corr. Ctr., 502 F.3d 1056, 1059 (9th Cir. 2007).
We affirm.
The Rooker-Feldman doctrine did not apply when the action was filed
because there was no final state court judgment. See Exxon Mobil Corp. v. Saudi
Basic Indus. Corp., 544 U.S. 280, 292-93 (2005) (explaining that when there is
parallel state and federal litigation, disposition of the federal action, once the state
court adjudication is complete, is governed by preclusion law). Nevertheless, the
district court properly dismissed the action because the issue of whether Freeman’s
bank account contained funds exempt from garnishment was litigated by the
parties or their privies in state court and decided by the Washington courts in favor
of defendants. See Freeman v. Bergan, No. 05-2-26618-0SEA, slip op. at 1-2
(Wash. Super. Ct. Sept. 14, 2007); Freeman v. Bergan, No. 05-2-26618-0SEA, slip
op. at 1 (Wash. Super. Ct. Oct. 3, 2007); see also Rains v. State, 674 P.2d 165, 169
(Wash. 1983) (describing elements of issue preclusion under Washington law).
Freeman’s remaining contentions are unpersuasive.
AFFIRMED.
JK/Research 2 08-35634 | 01-03-2023 | 10-13-2015 |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.