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https://www.courtlistener.com/api/rest/v3/opinions/1970452/ | 3 B.R. 369 (1980)
In the Matter of Gary R. UTTER and Susan G. Utter, Debtors.
Bankruptcy No. 79-24030.
United States Bankruptcy Court, W.D. New York.
April 15, 1980.
George M. Reiber, Rochester, N.Y., trustee of the debtors.
MEMORANDUM AND DECISION
EDWARD D. HAYES, Bankruptcy Judge.
The debtors above named filed a joint petition under Chapter 13. Their plan calls for classification of unsecured claims into two classes. The first class to be paid a hundred cents on the dollar consisted of a debt owing to Security Trust Company and co-signed by the sister of the husband. The other unsecured creditors were scheduled in a separate class and were to be paid little or nothing. The issues raised at the hearing were, are such classifications suitable and if claims are classified in that way, can the plan be confirmed?
Section 1325 of the Code permits confirmation of a plan if the property distributed under the plan is not less than the amount that would be paid under Chapter 7 of this Title. Section 1322 requires that the plan can classify claims and provide the same treatment for each claim within a particular class. Section 1122 provides for the classifications of claims, if the claims are "substantially similar" to other claims in the class.
In the case above, the classification appears to satisfy the test of Section 1325. However, Section 1122a provides that a plan may classify a claim "only if such claim or interest is substantially similar to the other claims or interests of such class." Classification is permitted only if the claims are "substantially similar." 5 Collier on Bankruptcy ¶ 1122.03[1] concludes that "substantially similar" means "similar in legal character or effect as a claim against the debtor's assets or as an interest in the debtor." Judge Mabey in analyzing Sections 1322 and 1122 in In re Iacovoni et al., 2 B.R. 256, 5 B.C.D. 1270 (Bkrtcy.) states:
Thus, only debts which have identical legal rights in the debtor's (or the estate's) assets may be classified together. Collier implies by example that all allowed, nonpriority, unsecured claims have equal right to pro rata distribution of assets after payment of secured and priority claims.
Judge Mabey concluded in that case that Section 1122 appears not to allow a separate classification of an unsecured debt based solely on the presence of a co-debtor. The existence of a co-debtor does not change the nature of the debt itself nor does it alter that debt's position in respect to its claim on the debtor's assets.
*370 Similarly, in In re Douglas and Rhonda Fonnest, (5 B.C.D. 1236), Judge Brown found that there was no reason for differentiating a co-signed note when a plan classified unsecured creditors into separate classes depending on whether a co-signer was on the note.
Judge Lee in discussing Chapter 13, Lee, Chapter 13 nee Chapter XIII, 53 Am.Bankr. L.J. 303 (1979), says:
It appears doubtful the courts will condone debtors placing debts on which co-debtors are obligated in a class separate and apart from other unsecured debts for purposes of the plan. The Code permits unsecured debts to be placed in a separate class on the basis of amount in order that small claims may be paid expeditiously for administrative convenience. It also permits unsecured claims on which the last payment is due after the date on which the final payment under the plan is due to be dealt with separately. There is no authorization for further classification of unsecured debts . . .
Judge Creahan in our District in In re John A. McKenzie, 6 B.C.D. 19, at page 21 says:
In addition to the requirements of § 1122(a), however, any classification would of necessity have to pass the muster of § 1322(b)(1). It is difficult to imagine any classification of unsecured creditors which would not discriminate against some class in one manner or another. Classification in itself would seem to denote discrimination. The crux of the issue, however, is unfair discrimination. Here, all unsecured creditors have the same rights vis-a-vis estate property, even though that property is future income. The claim of Spencer Workers Federal Credit Union has no greater call on, or right to, that future income than any other unsecured creditor. The fact that there is a third party guarantor on the obligation does nothing to change the nature of the claim against the estate. To allow the claim more than a pro rata share in that estate is to discriminate unfairly against the remaining unsecured creditors, a result explicitly prohibited by § 1322(b)(1).
Based on the foregoing discussion, this Court finds that the classification proposed by the Utters discriminates unfairly against the unsecured creditors who are classified in the class that does not contain co-signed debts. Such a classification does not meet the test of § 1122 and 1322 which requires that claims or interest be classified into classes which are "substantially similar" and that there be no unfair discrimination. Therefore, the classification of debts in this bankruptcy are improper and the plan is not confirmed and it is so ordered.
This Memorandum and Decision shall constitute Findings of Fact and Conclusions of Law in accordance with Rule 752 of the Rules of Bankruptcy Procedure. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2374577/ | 462 A.2d 1094 (1983)
Dominick A. PAOLI, Sr. and Violet Lee Paoli, His Wife, Plaintiffs,
v.
DAVE HALL, INC., a Corporation of the State of Delaware, Donald F. Deaven, Inc., a Corporation of the State of Delaware, William C. Zern and E.I. DuPont de Nemours & Company, a Corporation of the State of Delaware, Defendants.
Superior Court of Delaware, New Castle County.
Submitted: December 20, 1982.
Decided: April 11, 1983.
Albert L. Simon, and Stephen P. Casarino, Wilmington, for plaintiffs.
J.R. Julian, Wilmington, for defendants Dave Hall, Inc. and E.I. DuPont de Nemours & Company.
Susan C. Del Pesco, of Prickett, Jones, Elliott, Kristol & Schnee, Wilmington, for defendants Donald F. Deaven, Inc. and William C. Zern.
*1095 O'HARA, Judge.
Cross-motions for summary judgment have been advanced by defendant Dave Hall, Inc. ("Hall") and defendants Donald F. Deaven, Inc. ("Deaven") and William C. Zern ("Zern"). The issues upon which the parties seek summary adjudication[1] concern 1) whether Zern, a crane operator in the service of equipment owner Deaven and leased by him to general contractor Hall to operate said crane, was, in fact, a "loaned employee" of the latter during the incident giving rise to this lawsuit, and 2) whether Deaven and Zern are entitled to indemnity from Hall in the event liability for negligence is assessed against them.
The underlying action is one for personal injuries arising in the following manner. In accordance with a contract entered into with E.I. DuPont de Nemours & Company, Hall was in the process of constructing a pharmacological laboratory in Newark, Delaware. *1096 In order to complete the roof of said structure, Hall leased from Deaven a crane to lift prefabricated, triangular shaped trusses onto the perimeter walls. Deaven likewise supplied an operator, Zern, to the job site to man this equipment. In undertaking this construction procedure, Zern placed the trusses along the length of the building's concrete walls, with each truss braced and connected to the adjacent truss.
Midway through this procedure, Hall's foreman instructed Zern to begin depositing plywood bundles on the trusses. The first bundle was placed thereupon without incident; the second, however, was not, and as a result the trusses toppled over and the walls of the building collapsed, injuring plaintiff Dominick A. Paoli, Sr., who was thrown from the scaffolding on which he was standing.[2]
At this juncture there is a factual dispute as to what precisely occurred during placement of the second bundle of trusses to cause the structure to collapse. Zern explained the incident as follows:
The bundles were on the outside of the building. I was signaled to pick the bundle up and send it up to the roof, which I did. I got it up to the roof in the position they wanted. They wanted me to lower it on the roof. I lowered it on the roof. And they held me there. I the bundle was on the roof completely, but I still had the majority of the weight. And at that point they wasn't ready for me to release the full load yet; so I locked the crane in position and waited. They gave me the signal to let it down; I let it down. And I am not sure exactly who was the man unhooking. I released it. He gave me a signal to release it. I give him the weight. He reached up to unhook me. And that's when the trusses fell. So I seen movement, I picked back up on the load, I thought maybe he would hang on to the load. And the building fell. I swung back over, let the plywood down and that was it.
Earl Bowman, a Hall employee who witnessed the event, offered a different account of Zern's actions:
He started to let it down. It got closer to the truss so it looked like he was letting it down and then at the last minute he swung it to the south but at this time it was close enough to the trusses where it must to come down on this teeter-totter a bit and come down and hit a couple trusses and bounced against them.
The evidence is similarly controverted with respect to Zern's reliance on hand signals from the Hall employees.
On their motion for summary judgment, defendants Deaven and Zern seek to have any liability for negligence assessed against Zern[3] imputed to Hall under the borrowed-servant or loaned employee doctrine. The proper inquiry in determining whether the doctrine is applicable appears in Richardson v. John T. Hardy & Sons, Inc., Del.Supr., 182 A.2d 901 (1962):
Whether or not a loaned employee becomes the employee of the one whose immediate purpose he serves is always a question of fact, and depends upon whether or not his relationship to the specific employer has the usual elements of the employer-employee status. Fundamentally, it is not important whether or not he remains the employee of the general employer as to matters generally. What is important to determine is, with respect to the alleged negligent act in question, whether or not he was acting in the business of and under the direction of the general or the specific employer. * * This is almost always determined by which employer has the right to control and direct his activities in the performance of the act allegedly causing the injury, *1097 and whose work is being performed. * * *
Furthermore, in the instant case, Hall directs the Court's inquiry to the presumption that an owner of heavy rented equipment, who supplies to the lessor an operator therefor, retains control over the actual operation of the equipment, and in the actual operation thereof, the operator remains the employee of the owner. Richardson v. John T. Hardy & Sons, Inc., supra; Brittingham v. American Dredging Company, Del.Supr., 262 A.2d 255 (1970).
Although both Richardson and Brittingham involved the lease of heavy equipment, the above cited presumption was conclusive in neither case; in Richardson it did not even attach since the Court found that the negligence charged was not an act of actual operation of the machine. Specifically, Richardson involved an action against the lessor of a backhoe for injuries sustained by the lessee's foreman when the side wall of a trench collapsed on him. The Court therein ruled that the alleged negligence of the machine's operator in piling the dirt too close to the trench was not imputable to the lessor, who had furnished operator and paid his wages, where 1) the operator was instructed where and how deep to dig the ditch by the foreman; 2) the foreman staked out the ditch for the operator's guidance; and 3) the foreman directed the operator on which side of the trench to pile the dirt removed. This conclusion was dictated by the fact that the negligence cited was not an act of actual operation of the machine, but rather the act of piling the dirt too close to the mouth of the trench.
The Brittingham case, on the other hand, did involve negligent operation of the heavy rental equipment itself. However, Brittingham was not an action against a lessor for his operator's negligence, but rather a suit brought by the owner/lessor against the lessee dredging company for damage to a bulldozer by imputing the operator's alleged negligence to the lessee, presumably under the borrowed servant doctrine. While the Court therein acknowledged the presumption against the owner/lessor of equipment, it further cited evidential considerations which support the presumption as well as those tending to defeat it:
The evidence in the case at bar is that the plaintiff selected the operator of the machine, retained the right to discharge him, retained the right to determine and supervise the method of operating the machine, paid the operator's wages, and paid for the upkeep and maintenance of the machine. The evidence further shows that defendant could not, and did not, attempt to control the actual operation of the machine; could not discharge the operator but only complain to plaintiff about him and had no responsibility for the upkeep and care of the machine.
Inasmuch as the authority of the lessee therein was limited to instructing the operator as to the area in which he was desired to work and the result he was to accomplish, the Brittingham Court declined to impute the operator's negligence to lessee under the borrowed servant doctrine.
Thus, under Richardson and Brittingham, this Court's inquiry reduces itself to whether the negligence charged involved actual operation of Deaven's crane, in which case there is a presumption that Zern remained the owner's employee for purposes of liability, or some other attendant act involving the control or discretion of Hall or his crew, thereby imputing liability to the lessee under the borrowed servant doctrine. At this juncture, the Court notes that plaintiffs allege that Zern was negligent as follows:
(a) In operating the crane to lift bundles of plywood sheets from the ground to the level of the then height of the partially constructed building, he allowed one or more of said bundles each weighing approximately 1,500 pounds to drag across and strike trusses which had been installed as part of the construction of said building causing the trusses to topple over and push out the walls of the building;
*1098 (b) By placing the bundles of plywood in a concentrated portion of the building resulting in the overloading of the trusses.
The first act articulated above suggests that the negligence occurred in the actual operation of the equipment. However, the latter basis of liability, involving placement of the bundles, indicates negligence in the exercise of judgment or discretion. Moreover there is evidence of record that the placing of plywood bundles was determined by Hall's crew and that operator Zern performed said act at their direction, a situation factually analogous to Richardson.
The parties admit that there is a factual dispute as to how the incident occurred; however, Hall asserts that the only material fact is that Zern alone controlled the actual operation of the machine. With that contention the Court does not agree, noting that said fact was not dispositive in Richardson.
In sum, the applicability of the borrowed servant doctrine with respect to defendant Zern is an issue ripe for jury determination. Under no circumstances will summary judgment be granted when there is a reasonable indication that a material fact is in dispute. Ebersole v. Lowengrub, Del.Supr., 180 A.2d 467 (1962).
The second issue raised by the parties' respective motions for summary judgment concerns the indemnity and defense provisions of the lease between Deaven and Hall. That agreement reads as follows:
Lessor agrees to supply the above equipment and necessary personnel to operate same under the direct and sole supervision of the Lessee.
Lessee agrees to hold lessor harmless for loss, damage and expense resulting from the operation of the above mentioned equipment either bodily injury or property damage including damage or loss to the equipment leased hereby, and agrees to defend lessor from all suits resulting from above operation.
Defendants Deaven and Zern suggest that the above language suffices to provide them indemnity and a defense for the consequences of their negligence occurring during the period of the lease.
Delaware Courts generally disfavor contractual clauses purporting to exonerate a party from liability in matters resulting from its own negligence. J.A. Jones Const. Co. v. City of Dover, Del.Super., 372 A.2d 540 (1977). The contract must clearly and unequivocally articulate an intent to afford such immunity, and if a contrary intent can reasonably be entertained, the Court will rule against indemnification. Blum v. Kauffman, Del.Supr., 297 A.2d 48 (1972). Those authorities which have held the contractual language sufficient to protect a party against allegations of its own negligence have all specifically referred to negligence of the protected party. Warburton v. Phoenix Steel Corporation, Del.Super., 321 A.2d 345 (1974), aff'd., Noble J. Dick, Inc. v. Warburton, Del.Supr., 334 A.2d 225 (1975); All-State Inv. & Sec. Agcy., Inc. v. Turner Const. Co., Del.Supr., 301 A.2d 273 (1972).
With regard to the provision at issue herein, the Court fails to discern an intent to exonerate Deaven from its own negligence. Not only must there be a reference to negligence, which is lacking in the instant case, but the allusion thereto must further specify that it is the negligence of the purportedly protected party which is contemplated in the indemnity agreement. J.A. Jones Const. Co. v. City of Dover, supra; State v. Interstate Amiesite Corporation, Del.Supr., 297 A.2d 41 (1972).
Thus, the Court concludes that the language in the instant contract does not meet the requisite established by the Delaware case authority. Accordingly, defendant Deaven is not entitled to indemnity or defense from Hall for any negligence attributed to Deaven or Zern as his employee (in the event the borrowed servant doctrine does not apply).
Finally, the Court turns to Hall's motion to strike all references by Deaven *1099 and Zern to testimony entertained at an Occupational Safety and Health Review Commission ("OSHRC") hearing bearing on the subject of this action. The OSHRC transcript is not properly in the record and, therefore, may not be considered on motion for summary judgment. G.R.Sponaugle & Sons, Inc. v. McKnight Const. Co., Del.Super., 304 A.2d 339 (1973). Nor is the testimony sworn or certified, an additional impediment to its consideration herein. United States v. Tuteur, C.A. 7, 215 F.2d 415 (1954).
For the reasons herein set forth, the Court concludes that 1) Cross-motions for summary judgment by Deaven and Zern and Hall on the applicability of the borrowed servant doctrine must be denied; and 2) on the issue of the indemnity and defense provisions of the lease between Deaven and Hall, motion for summary judgment by Deaven and Zern must be denied, but Hall's motion for summary judgment must be granted and 3) Hall's motion to strike references to testimony at the OSHRC hearing must be granted.
IT IS SO ORDERED.
NOTES
[1] Specifically, the parties seek opposite resolution of the same issues. Plaintiffs join defendant Hall in opposing defendants' (Deaven and Zern) motion for summary judgment.
[2] At the time of the accident, plaintiff was an employee of John W. Walker Construction Co., a sub-contractor of defendant Hall.
[3] Specifically, the complaint asserts that Deaven and Zern are jointly and severally liable to plaintiffs by reason of the alleged negligent acts of Zern. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1885619/ | 634 F. Supp. 674 (1986)
NATIONWIDE MUTUAL FIRE INSURANCE COMPANY, Plaintiff,
v.
Harold DUNGAN and Bobbie Dungan; United States of America, Farmers Home Administration, Defendants.
Civ. A. No. J84-0844(L).
United States District Court, S.D. Mississippi, Jackson Division.
April 4, 1986.
*675 James L. Carroll, Watkins & Eager, Jackson, Miss., for plaintiff.
John Arthur Eaves, Eaves & Eaves, Pshon Barrett, Asst. U.S. Atty., Jackson, Miss., for defendants.
MEMORANDUM OPINION
TOM S. LEE, District Judge.
This cause came before the court for trial and the court heard testimony from witnesses and reviewed exhibits admitted in evidence. Plaintiff Nationwide Mutual Fire Insurance Company (Nationwide) filed this action pursuant to 28 U.S.C. §§ 2201 and 2202 seeking a declaratory judgment on the issue of its liability on a homeowner's insurance policy issued by it to defendants, Harold and Bobbie Dungan, plus further necessary or proper relief. The Dungans counterclaimed alleging breach of contract and bad faith refusal by Nationwide to pay benefits under the homeowner's policy, entitling them to an award of punitive damages. The United States, on behalf of Farmer's Home Administration (FmHA), intervened and seeks a declaratory judgment that it is entitled to recover the proceeds of the policy by virtue of its priority lien on the Dungans' home notwithstanding any defenses Nationwide may be able to assert against the Dungans. Upon a review of the evidence adduced at the bench trial, the court makes the following findings of fact and conclusions of law:
FINDINGS OF FACT
Harold Dungan is a Mississippi resident who has been in the business of farming for the past twenty-five years. In addition to his farming operations, Dungan also owns a small trucking line and has been *676 employed by the United States government as a part-time federal crop insurance adjuster. For many years preceding the fire loss at issue in this suit, Dungan had maintained his residence at Pattison in Jefferson County, Mississippi. In 1974, Dungan constructed a palatial country home near Pattison, and it was for this home that he sought insurance coverage from Nationwide in 1982.
On or about January 6, 1982, Dungan called June H. Farrar, a Nationwide agent, at her office in Jackson, Mississippi to inquire about obtaining insurance coverage for his home. Dungan had been referred to Nationwide and Farrar by a neighbor who was a Nationwide insured. Shortly thereafter, Farrar and her district sales manager, Robert Whitlatch, drove to Dungan's home for the purpose of taking his application for insurance and to evaluate the risk involved in providing coverage.[1] Following a cursory view of the premises, Farrar and Dungan returned to the den of the house to fill out the application form. The court concludes from the testimony that others present when Farrar took Dungan's application were Robert Whitlatch and, intermittently, Mrs. Dungan, who testified that she was in and out of the den area while the application was being taken. Because it was normal practice in the application process and because Dungan's eye-glasses were being repaired and no others were available to him, Farrar repeated the questions on the form verbatim and filled out the form in accordance with answers provided by Dungan. The specific questions read by Farrar and answered by Dungan, as taken from a carbon of the application form filled out that day and admitted in evidence, were as follows:
Question: Furnish full information, past losses, date, cause, item damaged or stolen, amount ($).
Answer: None.
Question: Any policy cancelled or non-renewed?
Answer: No.
Question: Have you or any member of your household been sued, filed bankruptcy or had repossessions or judgments within the last five years?
Answer: No.
Question: Name of mortgagee and address.
Answer: -0-.
Question: Mortgage balance.
Answer: -0-.
The coverage requested on the application was in the amounts of $100,000 on the structure, $50,000 on the contents and $20,000 for additional living expenses. The application was then signed by Mr. Dungan and witnessed by Farrar. The signature of the insured was located just below and presumably in accordance with a warranty appearing on the face of the application which stated, "I hereby declare that the facts stated in the above application are true and request the company to issue the insurance and any renewals thereof in reliance thereon." After the application was executed, Farrar wrote out a check to Nationwide in the name of "A-Bar-D Plantation, by Harold Dungan, Bobbie Dungan or Harold Dungan, Jr." in the amount of $428.00 representing premium payment for six months' coverage. The check was signed by Dungan and, as Farrar had authority to bind coverage upon receipt of premium, the coverage was in force and effect thereafter.
Early on July 19, 1984, the Dungans' house was completely destroyed by fire. At the time, Mr. Dungan was attending a crop insurance adjusters' seminar in Jackson, Mississippi, while his wife was visiting in Georgia. Nationwide received notice of the loss the same day and assigned the *677 claim to Bill Stevenson, a large loss property specialist with Nationwide. Stevenson conferred with Dungan over the telephone and agreed to meet with him at a restaurant in Port Gibson, Mississippi on July 23. There, Stevenson secured Mr. Dungan's signature on a non-waiver agreement[2] and his permission to go onto the premises to investigate the cause of the fire. Stevenson proceeded from Port Gibson to the house site where he conducted a brief investigation of the premises, determining that there was a total fire loss. Stevenson later ordered a detailed investigation to determine the cause of the fire. The investigation did not indicate arson.
The next day, July 24, 1984, Stevenson met with the Dungans at a motel in Vicksburg, Mississippi for the purpose of taking a statement and disbursing claim materials to them. A transcript of the statement was admitted in evidence. It reads in pertinent part:
Question: OK. So roughly you netted, your net income in 1983 would be somewhere around $50,000. Is that right?
Answer: That's close.
Question: Did you file an income tax return for 1983?
Answer: Yes, and I showed a loss.
* * * * * *
Question: OK. And who else do you owe?
Answer: Farmer's Home.
Question: Farmer's Home Administration?
Answer: Yes.
Question: And what is that against?
Answer: That's for operating loans and also for land notes.
Question: All right. And how much do you owe?
Answer: Total?
Question: Yes?
Answer: I'd say from 250 [$250,000.] toyou can check that outto 275 [$275,000.], something like ... [I pay them] somewhere around $70,000 at the end of the year.
* * * * * *
Question: Well are you up to date, are you current or are you behind in any of these debts?
Answer: No, I'm current with them.
* * * * * *
Question: There's no mortgage against this house. Is that correct?
Answer: That's right.
* * * * * *
Question: Have you or your wife ever been sued or had a judgment rendered against you?
Answer: No. Wait now back up. Maybe weI don't know whether what you're talking about or not, but anyway I had a ... combine ... one time. I had a little suit over that ... I bought one that wouldn't work, so I give it back to them, but that's just minor stuff.
Question: But then the combine dealer sued you?
Answer: Yeah.
Question: Did you go to court on it?
Answer: Right. In fact we may be still going to court on it. I don't know what we're going to do with it.
Question: Did they find a judgment against you or?
Answer: For 21 or 22 hundred dollars ...
Question: When did that take place?
Answer: Last year I believe.
Question: Any other judgments or suits?
Answer: No.
* * * * * *
Question: Have you or your wife or any members of your family ever had a previous fire loss?
Answer: Yes, about, there again eight or ten years ago. I had a trailer that burned.
Question: You had a trailer to burn?
Answer: Yes.
*678 Question: A mobile home?
Answer: Mobile home ...
Question: Is that what you were living in before you got into your new house?
Answer: Right. But we were living in the new house when it burned ...
Question: OK, was the trailer insured?
Answer: Yeah, I had a little insurance on it.
Question: Who was the insurance company?
Answer: I couldn't a bit more tell you than nothing.
Question: Did the insurance company pay the claim?
Answer: Yes, sir.
Question: Do you remember how much they paid?
Answer: Seems like around $12,000, but now I'm not sure ...
Question: You don't remember what the name of the insurance company was?
Answer: No, I don't.
Questions: Or do you remember who the agent was, who handled your insurance business at that time?
Answer: No, I really don't. Because we changed ... you know so many different policies. Your farm equipment is one policy, you get trucks ... your home. I really don't, to be honest with you. We could probably check and find out for you.
* * * * * *
Question: OK. Have you ever had a policy cancelled or refused renewal?
Answer: No.
At trial, Stevenson testified that he saw nothing unusual or irregular in Mr. Dungan's responses to his questions. Mrs. Dungan agreed with the answers given by her husband. Stevenson then gave the Dungans a "personal property loss packet," which contained contents loss inventory forms and a blank sworn statement in proof of loss, and told them to complete the forms and submit them to Nationwide as soon as possible. Stevenson also gave the Dungans a check from Nationwide in the amount of $770 as an advance to help defray interim living expenses. He informed them that they could expect their check for the loss in some six weeks.
After meeting with the Dungans, Stevenson proceeded from Vicksburg to Port Gibson and thence to Fayette, Mississippi to perform a routine search of the courthouse records to verify ownership of the property. The search yielded much more. He gleaned from the records that FmHA held a mortgage on the Dungan residence. Stevenson then went to the Jefferson County office of the FmHA in Fayette and talked with James O. Taylor, FmHA County Supervisor, concerning the Dungans' mortgage. Taylor informed him that FmHA held a mortgage on the Dungans' home and that the Dungans were delinquent in payment of accounts owed to FmHA totalling $381,736.84. Taylor also informed Stevenson that such arrearage was not uncommon among farmers in the region. Stevenson produced to Taylor a waiver of records form signed by the Dungans, and Taylor allowed him to examine the Dungans' file. There Stevenson found an old insurance policy issued to the Dungans by United States Fidelity & Guaranty Company (USF & G) through the Gage Insurance Agency in Port Gibson. Back in Port Gibson and upon information provided by Gage employees, Stevenson learned that less than a month prior to the issuance of the Nationwide policy, USF & G had cancelled four policies of insurance which it had with the Dungans. These included a homeowner's policy in the names of Mr. and Mrs. Dungan covering their Pattison residence and an inland marine policy and two fire policies, all payable to Harold Dungan. The effective date of the USF & G policies was November 16, 1981, and they were cancelled effective December 28, 1981. Stevenson also learned that contrary to the statements contained on the Nationwide application, USF & G had paid Harold Dungan $54,500 on a bulldozer fire that occurred on April 9, 1981, and that Foremost Insurance Company had paid him for a total loss on a double-wide mobile home that burned on January 26, 1974, and some *679 $200 for a loss occasioned by lightning's striking the mobile home on May 18, 1971. Stevenson calculated that the debts owed by the Dungans as of July 25, 1984, including outstanding notes to the Federal Land Bank Association of Brookhaven, two Port Gibson banks and a Vicksburg bank, collectively totalled $464,470.56. At the conclusion of his testimony, Stevenson, who has been in the business of insurance claims adjusting since 1962, stated that he had "never seen a case with so much prior outstanding debt."
Based on the investigation by Stevenson, Nationwide exercised its right under the policy to demand that the Dungans submit to an examination under oath concerning the fire loss. The examination under oath was conducted on September 14, 1985. Mr. Dungan's responses to questions posed in the examination were adopted by Mrs. Dungan. The substance of pertinent parts of his responses were as follows: that his total outstanding debt to the FmHA was between $250,000 and $300,000; that their financial condition was "good"; that the only prior cancellations or non-renewals of insurance policies had been in connection with automobile policies; that the only prior losses he had suffered were fires in his trailer and his father's house, in which he was living at the time it burned; and that the contents loss inventory form was accurate. The examination under oath was never amended by the Dungans prior to trial.
On October 23, 1984, the Dungans submitted a sworn statement in proof of loss to Nationwide claiming coverage under the policy in the amount of $200,600 including in excess of $60,000 for loss of contents and home furnishings. The claim was forwarded to Ken Yeager, Nationwide's district claims manager for all of Mississippi, who determined, based upon advice of counsel, to deny the claim on November 9, 1984. Yeager testified at trial that the reasons for denial were as follows: (1) material misrepresentations existing on the application for insurance; (2) material misrepresentations in the Dungans' examination under oath; (3) material misrepresentations in the sworn statement in proof of loss, specifically in the contents inventory and amount; and (4) the recommendation of Bill Stevenson. On November 16, 1984, this action requesting declaratory relief was filed.
On September 21, 1984, Nationwide's counsel retained the services of Cecil Brown, a certified public accountant, to review the financial records of the Dungans. Brown testified at trial that his examination of the records indicated that the Dungans were in poor financial condition on the date of the fire, July 19, 1984, which condition continued to deteriorate thereafter. Such opinion directly contradicted Dungan's statement to Stevenson and in his examination under oath that his financial condition was "good." Brown further testified that, from his review of the Dungans' records, there was a poor probability of accuracy in the contents list submitted by the Dungans with their proof of loss. Brown was of the opinion that the Dungans could not have accumulated home contents and other personalty allegedly lost in the fire, totalling over $60,000, in the years immediately preceding the fire.
With reference to the position taken in this suit by the United States on behalf of the FmHA, the evidence is undisputed and this court finds as a fact that the Dungans did not list the FmHA as a mortgagee on their residence in the application, the policy or in subsequent documentation of their loss. The language of the "Mortgage Clause" of the policy issued to the Dungans specifically requires that any mortgagee claiming benefits under a policy must be named therein.[3] It was only during *680 the investigation by Bill Stevenson that the interest of the FmHA was disclosed.
The Dungans' version of the facts of this case is substantially at odds with the proof adduced by Nationwide. In defendants' case-in-chief, Mr. Dungan took the position that he informed Farrar of all previous fire losses, previous cancellations of his USF & G policies, the suit pending against him initiated by Rick Motors and the FmHA's mortgage on much of his land. To the extent that he may have neglected to inform Farrar of all previous losses or cancellations, particularly with regard to the bulldozer fire, a fire in a chicken house he owned and the prior USF & G cancellations, Dungan stated that he was under the impression that Farrar was asking only if he had any previous fire loss on his home, or if he had any homeowner's insurance cancelled. Dungan pled the same ignorance when confronted with answers he gave Stevenson in the initial statement taken in Vicksburg on July 24. In explanation of the fact that the application bears misinformation concerning his financial and insurance history, the Dungans contend that agent Farrar, motivated by blind desire to write the coverage and secure her commission, ignored the accurate answers given by Mr. Dungan.[4]
In support of their contention that accurate information was provided Farrar, the Dungans called Bill Nicholson at trial. Nicholson, a close friend of the Dungans for over 30 years, testified that he visited the Dungan home in January 1982, coincidentally on the very day and hour that Farrar and Whitlatch were present for purposes of taking the application. The substance of his testimony was as follows: that he drove alone from his home in Florence, Mississippi on a day-long ride through west Mississippi to visit friends and relatives; that he arrived at the Dungans' home in the late morning; that he saw a man, presumably Whitlatch, sitting in a car with the motor running on the circular drive in front of the house; that Mrs. Dungan answered the door and led him into the den area; that Mr. Dungan and a lady, presumably June Farrar, were seated together on the couch; that the lady was apparently filling out a paper which she held in her lap; that Dungan and the lady did not stop talking when he came into the den, as Dungan was explaining to her about a bulldozer fire and trailer fire he had previously experienced; that Dungan introduced the lady as his insurance agent; that he went into the kitchen with Mrs. Dungan for coffee, where he was joined by Mr. Dungan some short time later; that he stayed another eight to ten minutes before leaving the house; and that none of the other persons he intended to visit that day were home.
The court is unable to credit Nicholson's testimony. Nicholson could recall no details about his visit to the Dungansi.e., the make or color of car in which Whitlatch was allegedly sitting when Nicholson came to the door; the date or day of the week of his visit; anything about Farrar except that she was holding papers in her lapexcept the specifics of a conversation in which he had no apparent interest. It is also incredible that, without phoning first, he would have driven from Florence to the Dungans' home, a distance of some 60 miles, in icy conditions, for an eight to ten minute social visit with Mr. Dungan. Additionally, Dungan testified that he had completely forgotten about Nicholson's visit on the day the application was taken until Nicholson volunteered his information in informal communications some six to eight months prior to trial. Nicholson did not talk with Dungan about the details of his recollection until Dungan's counsel had secured a statement from Nicholson for use in this litigation. The court also finds it convenient, at best, that no other party *681 whom Nicholson had intended to visit that day was home. The testimony of Farrar and Whitlatch concerning the taking of the application directly contradicted Nicholson's testimony, and the court, as finder of fact, credits the testimony of Farrar and Whitlatch as more consistent with logic.
Alternatively, the Dungans contend that if there were misrepresentations made by Dungan in responding to questions on the application, any such misrepresentations were not material; that is, Nationwide would have written the coverage notwithstanding the Dungans' prior losses, cancellations, suits or judgments and mortgages. Ken Yeager, Nationwide's district claims manager, and Sherry E. Crenshaw, a senior personal lines underwriter for Nationwide, did testify that it was common practice to accept risks involving prior outstanding debt or mortgages on the home, or an outstanding suit or judgment against the applicant. However, Crenshaw testified that she would not have accepted the coverage had the application indicated that the Dungans had suffered prior fire losses, or that USF & G had cancelled four policies within a month before Dungan submitted his application to Nationwide. Crenshaw testified, and common sense would indicate, that the answers provided on the application are "crucial" to the underwriter in seeking to determine acceptable risks.
In support of their counterclaim for breach of contract and "bad faith" denial of payment by Nationwide, the Dungans contend that the insurance company has a duty to investigate the responses given on an application at the beginning of the relationship with the insured. Waiting until after a claim is made to investigate the veracity of an insured's responses on his application constitutes bad faith, defendants assert. No evidence of any loss on the part of the Dungans, other than the limits of the coverage in the policy, was adduced at trial. The record is devoid of any proof of the financial net worth of Nationwide.
CONCLUSIONS OF LAW
Under Mississippi law, misstatements of material fact in an application for insurance provide grounds for declaring a policy issued in reliance thereon void ab initio. Dukes v. South Carolina Insurance Co., 590 F. Supp. 1166, 1168-69 (S.D.Miss.1984) aff'd 770 F.2d 545 (5th Cir.1985). See also Colonial Life & Accident Insurance Co. v. Cook, 374 So. 2d 1288, 1292 (Miss.1979); Tolar v. Bankers Trust Savings & Loan Ass'n, 363 So. 2d 732, 735 (Miss.1978); Prudential Insurance Co. of America v. Estate of Russell, 274 So. 2d 113, 116 (Miss. 1973). Where there is proof that the application contains material misstatements of fact, as here, there is no requirement that the insurance company prove intent to misrepresent material facts on the part of the insured. Dukes, 590 F.Supp. at 1169. The court in Dukes, quoting from Fidelity Mutual Life Insurance Co. v. Miazza, 93 Miss. 18, 20, 46 So. 817, 819 (1908), stated:
It is the universal rule that any contract induced by misrepresentation or concealment of material facts may be avoided by the party injuriously affected thereby. If the applicant for insurance undertakes to make a positive statement of fact, if it be material to the risk, such fact must be true. It is not sufficient that he believes it true, but it must be so in fact, or the policy will be avoided. Provided, always, that the misstatement be about a material matter. If the applicant is not informed as to any question asked in the application, he should so state, and there can be no misrepresentation.
590 F.Supp. at 1168.
The court further stated:
Because no genuine issue of a material fact remains, the Plaintiff's suit must fail in that the policy of insurance should be declared void ab initio. This is simply a general principle of contract law which the special nature of insurance contracts does not alter. The parties entered into this contract under a mistake of fact. Had that mistake been shown the insurance company would not have written the policy. Whether the fact was *682 intentionally or unintentionally misstated by the Plaintiffs is unimportant.
590 F.Supp. at 1169.
This is precisely the issue presented to this court by the proof. It cannot be denied with any reasonable degree of candor that Nationwide would not have underwritten the coverage had the Dungans presented Farrar all material facts called for in the questions on the application. That Mr. Dungan may have been confused concerning the nature and extent of the information requested by Farrar is perhaps understandable, but is no defense to the company's right to avoid a policy that was issued in reliance on material misrepresentations. The duty to speak up in the event of confusion was on Dungan. Even assuming that Dungan was in fact unaware of the FmHA mortgage on his home, he clearly knew of the prior fire losses and the cancellation of four USF & G policies less than a month prior to Farrar's visit. By refusing or neglecting to volunteer such information to Farrar when the questions she asked unequivocally solicited information of this type, Dungan materially misrepresented his financial condition in the application. Therefore, the court is of the opinion that Nationwide has no liability on the policy issued to the Dungans in reliance upon Mr. Dungan's material misrepresentations in the application.
Nationwide also contends, alternatively, that the policy was rendered void by the Dungans' failure to cooperate in the investigation of the claim and by their violation of the clause in the policy prohibiting misrepresentation and concealment. This court has previously had occasion to examine the nature of an insured's duty to cooperate in the investigation of a claim and the validity of avoiding a policy upon proof of material misrepresentation by the insured during an investigation. In Clark v. Aetna Casualty & Surety Co., 607 F. Supp. 63 (S.D.Miss.), aff'd, 778 F.2d 242 (5th Cir. 1985), this court determined that the insured made false material statements with the intent to deceive during the investigation of his claim, entitling the insurance company to declare the policy void under the misrepresentation clause of the policy.[5] The analysis undertaken in Clark, both by this court and on appeal, is applicable here.
Material misrepresentation clauses are reasonable and valid under Mississippi law and are to be given a reasonable interpretation. Clark, 607 F.Supp. at 66 (quoting Southern Guaranty Insurance Co. v. Dear, 252 Miss. 69, 172 So. 2d 553 (1965)). In Mississippi, for an insurance company to defeat a policy on the basis of a "concealment" clause, it must establish that statements by the insured were (1) false and (2) material and (3) knowingly and willfully made. Clark, 778 F.2d at 245 (emphasis original) (citing Watkins v. Continental Insurance Co., 690 F.2d 449 (5th Cir.1982)). The Mississippi Supreme Court "takes a broad view of materiality" in this context. Clark, 607 F.Supp. at 66, 778 F.2d at 246 (quoting Edmiston v. Schellenger, 343 So. 2d 465 (Miss.1977)). The following types of statements have been held material for purposes of avoiding liability under a concealment clause: false answers as to the insured's location at the time of the fire, Edmiston, 343 So.2d at 466; refusing to give answers to an insurance company investigator following a fire, Taylor v. Firemans Fund Insurance Co., 306 So. 2d 638, 644-45 (Miss.1974); refusing to answer inquiries about financial matters, Southern Guaranty, 172 So.2d at 554-56.
In both the interview with Stevenson on July 24 and the examination under oath on September 14, Dungan withheld or concealed information relating to the extent of his previous fire losses (not until *683 trial did Dungan reveal that he had a bulldozer fire in the spring of 1981 for which he received insurance payments), the December 1981 cancellations of four policies by USF & G, his financial condition and the extent of his debts, and the mortgage on his home held by the FmHA. The statements Dungan gave were thus incomplete in places where they were not blatantly false. Beyond the statements he did give, Dungan was silent or concealed facts in response to questions seeking information he knew or should have known. Dungan thus knew that he was giving false answers. Under such circumstances, there is no requirement that Nationwide introduce evidence of Dungan's intent to deceive, for "[w]here false and material statements are knowingly and willfully made, `the intent to deceive will be implied.'" Edmiston, 343 So.2d at 467 (quoting Claxton v. Fidelity & Guaranty Fire Corp., 179 Miss. 556, 566, 175 So. 210, 212 (1937)). Therefore, the court is of the opinion that Nationwide sustained its burden of proving intentional concealment by the Dungans during the investigation of the fire loss in violation of the concealment clause of the policy. Accordingly, Nationwide is entitled to declaratory judgment that it was within its rights granted in the policy and under Mississippi law when it denied payment.
The FmHA asserts in this action that it is entitled to recover the proceeds of the policy because of the deed of trust executed to it by the Dungans covering the home. As stated, however, the policy issued to Dungan by Nationwide did not name the FmHA as mortgagee, and Nationwide did not discover the interest of FmHA until Stevenson undertook investigation of the Dungans' claim. The FmHA contends that it is entitled to the protection provided mortgagees in Miss.Code Ann. § 83-13-9 (1972) regardless of the fact that the policy contained no mortgage clause naming it as mortgagee.[6] Citing National Security Fire & Casualty Co. v. Mid-State Homes, Inc., 370 So. 2d 1351 (Miss.1979), FmHA contends that the statute is automatically written in to a fire insurance policy wherein the insured is a grantor of a deed of trust, as a matter of public policy.
The Nationwide policy issued to the Dungans was a homeowner's policy with fire protection and not exclusively a fire policy. The court cannot give the statute such broad construction in the absence of a mortgage clause naming FmHA in the Dungans' policy. The general rule was stated in Employers Mutual Casualty Co. v. Standard Drug Co., 234 So. 2d 330 (Miss. 1970):
[I]f the mortgagor covenants to keep the mortgaged property insured for the better security of the motgagee [sic], the latter will have an equitable lien upon the proceeds of insurance carried by the mortgagor, in case of a loss, to the extent of his interest in the property destroyed, even though the policy contains no mortgage clause and is payable to the mortgagor.
234 So.2d at 333 (emphasis added).
In Calvert Fire Insurance Co. v. Environs Development Corp., 601 F.2d 851 (5th Cir.1979), the Fifth Circuit quoted the rule stated in Standard Drug in support of the proposition that a mortgagee not named in a policy has only an equitable lien on insurance proceeds paid to the insured mortgagor, and further stated:
The general rule is that a mortgagee or lienholder has no claim to the benefit of a fire insurance policy unless he has been named loss-payee or the policy has otherwise been assigned to him.
601 F.2d at 858 (citing Wheeler v. Factors' and Traders' Insurance Co., 101 U.S. (11 Otto) 439, 25 L. Ed. 1055 (1880)).
Furthermore, the blank mortgage clause in the Dungan policy appears to the court to be a simple "loss-payable" or "open-mortgage" clause payable to the mortgagee "as his interest may appear." Under Mississippi law, and even assuming *684 that FmHA had been named in the policy, FmHA, as mortgagee, is only entitled to receive the amount due it on its mortgage out of funds recovered by or due the insured, and the loss-payable clause does not make the mortgagee a party to the contract. Hartford Fire Insurance Co. v. Associates Capitol Corp., 313 So. 2d 404, 407 (Miss.1975).
Thus, the court concludes that FmHA, because it was not named in the policy, occupies the status of a mere equitable lienholder as to the insurance proceeds. The right of a holder of an equitable lien on insurance proceeds to recover such proceeds is solely contingent on and derivative of the insured's right to recover. Calvert Fire Insurance Co., 601 F.2d at 858. See also Whitney National Bank v. State Farm Fire & Casualty Co., 518 F. Supp. 359, 362 (E.D.La.1981). An unlisted or unnamed mortgagee likewise retains only an equitable lien on insurance proceeds and remains subject to any defenses which the insurer may assert against the mortgagor. Cottrell v. Clark and Citizens Mutual Insurance Co., 337 N.W.2d 58, 61 (Mich.App.1983). Lastly, even if FmHA were named in the policy, the mortgage clause appears to be a "loss payable" or "open mortgage" clause, which makes the mortgagee's right to recover contingent on the mortgagor's right to recover. Hartford Fire, 313 So.2d at 407.
Accordingly, the court is of the opinion that FmHA is not entitled to recover the proceeds of the Nationwide policy issued to the Dungans because it occupies the status of an equitable lienholder and is thus subject to the material misrepresentation defense asserted against the Dungans by Nationwide.
The Dungans' counterclaim for breach of contract and punitive damages fails as a matter of proof and as a matter of law[7] for the reasons previously cited by this court in support of its conclusion that Nationwide is entitled to a declaratory judgment in its favor.
CONCLUSION
For the reasons stated herein, the court concludes that Nationwide is entitled to a declaratory judgment in its favor to the effect that it has no liability to either the Dungans or FmHA on the policy of insurance. The Dungans' counterclaim for breach of contract and punitive damages should therefore be dismissed with prejudice, and the motion of the United States on behalf of the FmHA for declaratory judgment that it is entitled to recover its interest as mortgagee on the Dungan home under the policy of insurance should be denied. A separate judgment conforming with this opinion shall be entered according to the local rules.
NOTES
[1] The record in this case contains conflicting testimony regarding the precise date on which Dungan called Farrar to discuss coverage and the date on which Farrar and her supervisor, Robert Whitlatch, drove to Dungan's home to receive his application. While the application bears the date of January 7, 1982, it appears that it might have been taken some days after that and then backdated. Beyond the issue of credibility, the critical relevance of the backdating urged by Dungan's counsel is not apparent to the court, and the court will not undertake to determine the exact date on which the application was taken.
[2] The non-waiver agreement provided that Nationwide was not waiving any of its defenses under law or the terms of the contract by investigating the cause or amount of the fire loss.
[3] The mortgage clause in the policy reads in pertinent part:
12. Mortgage Clause
If a mortgagee is named in this policy, any loss payable under Coverage A or B shall be paid to the mortgagee and you, as interests appear ...
The clause would thus appear to be of the type known as a "loss payable" or "open-mortgage" clause under Mississippi law. Hartford Fire Ins. Co. v. Associates Capital Corp., 313 So. 2d 404, 407 (Miss.1975).
[4] The court notes that on the day Farrar and Whitlatch came to the Dungan home to take the application, Dungan also showed them a rental home and a deer camp cabin he owned in the vicinity and requested that Nationwide provide coverage for these houses. After brief inspection, Farrar denied the requested coverage. Had she been motivated by a desire to come away with the largest premium check she could get, as suggested by the Dungans, it is logical to assume that she would have bound the coverage on those houses as well.
[5] In Clark the insured sued to recover payment under a policy of insurance issued by Aetna covering certain farm equipment owned by plaintiff that was destroyed by fire. During investigation of the claim, Clark claimed that he had bought several pieces of equipment from friends and family members, and he produced fraudulent bills of sale for the equipment. The proof showed that he had paid nothing for many of the items for which he sought coverage. This court found that such concealment and misrepresentation was willful, and the requisite intent to deceive was implied. 607 F.Supp. at 67.
[6] Miss.Code Ann. § 83-13-9 provides in part:
Each fire insurance policy taken out by a mortgagor or grantor in a deed of trust shall have attached or shall contain substantially the following mortgagee clause, viz ...
[7] Lack of coverage under the policy is a legitimate or arguable reason for denial of a claim. Mixon v. Provident Life & Acc. Ins. Co., 616 F. Supp. 139, 141-42 (S.D.Miss.1985), aff'd 783 F.2d 1061, (5th Cir.1986). Because coverage was not available under the circumstances, Nationwide is not liable for punitive damages under Mississippi law. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1434206/ | 36 Cal. 3d 539 (1984)
684 P.2d 826
205 Cal. Rptr. 265
THE PEOPLE, Plaintiff and Respondent,
v.
LAWRENCE RICHARD GARCIA, Defendant and Appellant.
Docket No. Crim. 22799.
Supreme Court of California.
August 6, 1984.
*544 COUNSEL
Quin Denvir and Frank O. Bell, Jr., State Public Defenders, under appoinment by the Supreme Court, Edward H. Schulman, Deputy State Public Defender, Robert E. Moore, Jr., under appoinment by the Court of Appeal, and Lawrence Richard Garcia, in pro. per., for Defendant and Appellant.
John K. Van de Kamp and George Deukmejian, Attorneys General, Robert H. Philibosian, Chief Assistant Attorney General, Daniel J. Kremer, Assistant Attorney General, Michael D. Wellington, Jay M. Bloom and A. Wells Petersen, Deputy Attorneys General, for Plaintiff and Respondent.
OPINION
BROUSSARD, J.
Carlos v. Superior Court (1983) 35 Cal. 3d 131 [197 Cal. Rptr. 79, 672 P.2d 862], held that proof of intent to kill or to aid a killing was essential to a finding of a felony-murder special circumstance under the 1978 death penalty initiative. (Pen. Code, § 190.2, subd. (a)(17).) We granted a hearing in the present case to decide whether to give retroactive effect to our Carlos decision and to determine the test of prejudice applicable when a trial court fails to instruct a jury in accord with that decision.
We have concluded that because the Carlos opinion does not overturn prior law, but stands as the first authoritative construction by this court of *545 the felony-murder provision of the 1978 initiative, it should apply to all cases not yet final arising under that enactment. Selecting a test of prejudice, however, presented us with a closer and more difficult question. We are persuaded, however, that under controlling decisions of the United States Supreme Court the failure to instruct upon intent as an element of a special circumstance, because it takes the issue of intent from the trier of fact, denies the defendant due process of law in violation of the Fourteenth Amendment. We further conclude that absent exceptional considerations not found in the present case the United States Supreme Court would hold such constitutional error was necessarily prejudicial. Therefore, while affirming defendant's conviction, we reverse the finding of a special circumstance under section 190.2.
I. Summary of facts and proceedings.
On August 10, 1979, defendant drove Orlando Sandoval, his nephew, to a shopping center in Oxnard. Defendant stopped in front of a liquor store to let Sandoval out, then parked the car in a nearby alley. Sandoval entered the store and shot Al Wieczorek, a clerk. Wieczorek died of a bullet wound to the chest caused by a dum-dum bullet.[1] Sandoval fled the store, apparently without taking anything, got in the car, and defendant drove away.
A few days later defendant was arrested while sitting in his car. The police found the gun used to kill Wieczorek under the pillow where defendant had been sitting. Defendant waived his right to remain silent and to counsel and agreed to talk to the police, but denied involvement in the crime. After the police talked to Sandoval, however, defendant admitted that he drove Sandoval to rob the liquor store, and that he knew Sandoval had a gun with dum-dum bullets. Sandoval told him that he panicked when he entered the store, and shot the clerk.[2]
Defendant was charged with attempted robbery and murder, with the special circumstance of felony murder. The prosecution did not seek the death penalty.[3]
*546 At trial the prosecution introduced defendant's confession and other evidence proving defendant acted as the get-away driver for Sandoval's robbery. It also presented testimony by James Odra Smith, who was confined in jail awaiting retrial on a murder charge. Smith testified that defendant admitted to him that he furnished the gun and bullets to Sandoval. The defense, seeking to impeach Smith, presented evidence that Smith had been a police informant in numerous cases and received substantial benefits in return for his activity, including a reduction in bail on Smith's murder charge from $250,000 to $25,000. Smith also knew that defendant might be a witness for the prosecution in Smith's murder case. The defense also presented psychiatric testimony, not to show insanity or diminished capacity, but to explain that defendant would be prone to confess falsely if he thought the confession would help a relative such as Sandoval.
The jury was instructed that it should find defendant guilty of first degree murder if it found that he had the specific intent to commit robbery and that the killing occurred in an attempt to perpetrate the crime of robbery. With regard to the special circumstance, the jurors were told only that the prosecution must prove beyond a reasonable doubt that the murder was committed while the defendant was an accomplice in the attempted commission of a robbery. They were not instructed that felony-murder special circumstances required an intent to kill or to aid in a killing. The jury returned a verdict finding defendant guilty as charged of attempted robbery and first degree murder, with the special circumstance of felony murder. The court, after denying a motion for new trial, sentenced defendant to life imprisonment without possibility of parole.
II. Issues relating to guilt.
(1) Defendant argues that his confession was induced by an implied promise of leniency, and should have been excluded. (See People v. Jiminez (1978) 21 Cal. 3d 595, 611-614 [147 Cal. Rptr. 172, 580 P.2d 672].) The record shows only that one detective told defendant: "If you guys were doing a robbery, he shot the guy, he panicked or whatever, that's the price he's going to have to pay. We're going to focus our thing on him Orlando. But there's no sense you going down the way he is, that, that far down with him, as a trigger man...."
This statement does not constitute an offer of leniency on the part of the police or the prosecution in return for a confession; it advised defendant that an accomplice is generally better off than a triggerman. That was sound advice; even if we do not take Carlos into account, an accomplice is far less likely to receive the death penalty than the triggerman. (See Enmund *547 v. Florida (1982) 458 U.S. 782, 794-795 [73 L. Ed. 2d 1140, 1150, 102 S. Ct. 3368].)
In People v. Hill (1967) 66 Cal. 2d 536, 549 [58 Cal. Rptr. 340, 426 P.2d 908], we observed that "[t]he line to be drawn between permissible police conduct and conduct deemed to induce or to tend to induce an involuntary statement does not depend upon the bare language of inducement but rather upon the nature of the benefit to be derived by a defendant if he speaks the truth, as represented by the police.... When the benefit pointed out by the police to a suspect is merely that which flows naturally from a truthful and honest course of conduct, we can perceive nothing improper in such police activity." We agree with the trial court that under the reasoning of Hill defendant did not receive an improper inducement to confess.[4]
(2) Defendant also contends that James Odra Smith was a police agent when he talked to defendant, and that Smith's testimony reporting their conversations should be excluded. Defense counsel, however, did not object to Smith's testimony at trial. Moreover, in view of defendant's confession, which established his guilt of attempted robbery and first degree murder, Smith's testimony concerning defendant's guilt of those crimes was harmless by any applicable test of prejudice.
III. Issues relating to the special circumstance finding.
(3) In Carlos v. Superior Court, supra, 35 Cal. 3d 131, we held that proof of intent to kill or to aid a killing is essential to a finding of felony-murder special circumstances under the 1978 death penalty initiative. Our decision necessarily implied that an instruction on intent to kill is required when the special circumstance issue is tried to a jury. No such instruction was given in the present case.
The effect of the Carlos decision upon the present case and other pending cases depends on whether that decision is given retroactive effect, and upon the standard of harmless error applied when the required intent instruction is not given. We deferred resolution of those issues in Carlos, believing the *548 issues were of sufficient difficulty and importance as to call for briefing and argument in a separate case.[5]
A. Retroactivity.
(4) In Donaldson v. Superior Court (1983) 35 Cal. 3d 24, 36-37 [196 Cal. Rptr. 704, 672 P.2d 110] we explained that "In determining whether a decision should be given retroactive effect, the California courts undertake first a threshold inquiry, inquiring whether the decision established new standards or a new rule of law. If it does not establish a new rule or standards, but only elucidates and enforces prior law, no question of retroactivity arises. [Citations.] Neither is there any issue of retroactivity when we resolve a conflict between lower court decisions, or address an issue not previously presented to the courts. In all such cases the ordinary assumption of retrospective operation [citations] takes full effect."
(5) Following this initial inquiry, California courts employ a tripartite test derived from Stovall v. Denno (1967) 388 U.S. 293 [18 L. Ed. 2d 1199, 87 S. Ct. 1967] to determine the retroactive effect of a decision.[6] Under this test, the court considers three factors: "(a) the purpose to be served by the new standards, (b) the extent of reliance by law enforcement authorities on the old standards, and (c) the effect on the administration of justice of retroactive application of the new standards." (Stovall v. Denno, supra, 388 *549 U.S. 293, 297 [18 L. Ed. 2d 1199, 1203]; People v. Kaanehe (1977) 19 Cal. 3d 1, 10 [136 Cal. Rptr. 409, 559 P.2d 1028].) The three factors, however, are not of equal weight: "the factors of reliance and burden on the administration of justice are of significant relevance only when the question of retroactivity is a close one after the purpose of the new rule is considered." (In re Johnson (1970) 3 Cal. 3d 404, 410 [90 Cal. Rptr. 569, 475 P.2d 841].) Under the tripartite test, when the purpose of a new rule is to deter future misconduct, or to define procedural rights collateral to a fair determination of guilt or innocence, the rule generally does not receive retroactive effect. (Donaldson v. Superior Court, supra, 35 Cal. 3d 24, 38, 39.) On the other hand, when a decision goes to the integrity of the fact finding process (People v. Kaanehe, supra, 19 Cal. 3d 1, 10), or "implicates questions of guilt and innocence" (Pryor v. Municipal Court (1979) 25 Cal. 3d 238, 258 [158 Cal. Rptr. 330, 599 P.2d 636]), retroactivity is the norm.
(6a) In the present case both the threshold inquiry and the tripartite test lead to the conclusion that the Carlos decision should be given retroactive effect. That decision addressed a question of first impression in this court. Decisions of the Courts of Appeal, reaching differing conclusions, were vacated by the grant of a hearing here. Thus there was never a final, authoritative opinion of a California appellate court holding that a defendant could be subject to a felony-murder special circumstance even though he lacked any intent to kill. Carlos therefore did not constitute a clear break from the past the overthrow of an established rule and the establishment of a new rule. Instead, it falls within the category of decisions generally given retrospective application.
Moreover, under the tripartite test, the purpose of a judicial decision is the most significant factor in determining its retroactive effect. The purpose of Carlos was to carry out the intent of the 1978 act of avoiding imposition of the death penalty or life imprisonment without possibility of parole upon persons who did not intend to kill. (7) Whenever a decision undertakes to vindicate the original meaning of an enactment, putting into effect the policy intended from its inception, retroactive application is essential to accomplish that aim. (See People v. Mutch (1971) 4 Cal. 3d 389, 395-396 [93 Cal. Rptr. 721, 482 P.2d 633].) (6b) If in addition, as in the present case, the decision represents the first authoritative construction of the enactment, no history of extended and justified reliance upon a contrary interpretation will arise to argue against retroactivity. Under these circumstances, the burden on the courts incurred in the retrial of the special circumstance issue is insufficient to tip the balance against retroactivity. The Carlos holding should apply retroactively to all cases not yet final.[6A]
*550 B. Prejudicial error.
(8a) We requested the parties to brief the various state and federal tests of prejudicial error. After review of the briefs and arguments presented, we have concluded that this case is controlled by a line of United States Supreme Court decisions beginning with In re Winship (1970) 397 U.S. 358 [25 L. Ed. 2d 368, 90 S. Ct. 1068] and continuing through Sandstrom v. Montana (1979) 442 U.S. 510 [61 L. Ed. 2d 39, 99 S. Ct. 2450] and Connecticut v. Johnson (1983) 460 U.S. 73 [74 L. Ed. 2d 823, 103 S. Ct. 969]. Although these decisions involve the constitutionality of state practices relating to presumptions and burdens of proof, they contain language and reasoning which indicate that instructions or omissions which deny a defendant his right to have the jury decide each element of a charged offense are necessarily reversible error.
In re Winship, supra, 397 U.S. 358 held that when a juvenile was charged with a criminal offense, the state must prove guilt beyond a reasonable doubt. (397 U.S. at p. 364 [25 L.Ed.2d at p. 375].) Mullaney v. Wilbur (1975) 421 U.S. 684 [44 L. Ed. 2d 508, 95 S. Ct. 1881], then held unconstitutional a Maine statute which classified all intentional homicide as murder unless the defendant proved by a preponderance of the evidence that he acted in the heat of passion on sudden provocation. The potentially broad scope of that holding, however, was soon restricted when in Patterson v. New York (1977) 432 U.S. 197 [53 L. Ed. 2d 281, 97 S. Ct. 2319] the court held that a statute placing the burden of proving extreme emotional disturbance on the defendant did not deny due process. Proof of extreme emotional disturbance, the court reasoned, was not necessary to prove commission of the crime (see 432 U.S. at p. 206 [53 L.Ed.2d at p. 289]) but a separate issue (p. 207 [53 L.Ed.2d at p. 290]).
Sandstrom v. Montana, supra, 442 U.S. 510, is the key decision in this line of authority. Sandstrom was a murder prosecution with a diminished capacity defense in which the court instructed the jury that "`[t]he law presumed that a person intends the ordinary consequences of his voluntary acts.'" (P. 517 [61 L.Ed.2d at p. 46].) Sandstrom quotes Winship to the effect that "`the Due Process Clause protects the accused against conviction except upon proof beyond a reasonable doubt of every fact necessary to constitute the crime with which he is charged.'" (P. 520 [61 L.Ed.2d at p. 48], quoting 397 U.S. 358, 364 [25 L. Ed. 2d 368, 375, 90 S. Ct. 1068].) The constitutional defect in the jury instruction, it says, was that "Sandstrom's jurors could reasonably have concluded that they were directed to find against defendant on the element of intent. The State was thus not forced to prove `beyond a reasonable doubt ... every fact necessary to constitute the crime ... charged.'" (P. 523 [61 L.Ed.2d at pp. 550-551].) *551 Even if the presumption did not direct a verdict, but only shifted the burden of proof, it would still violate the requirement that "`a State must prove every ingredient of an offense beyond a reasonable doubt, and ... may not shift the burden of proof to the defendant.'" (P. 524 [61 L.Ed.2d at p. 51], quoting Patterson v. New York, supra, 432 U.S. 197, 215 [53 L. Ed. 2d 281, 295].)[7]
(9) The United States Supreme Court decisions make it clear that when intent is an element of a crime, an instruction directing the jury to find or conclusively presume intent denies due process, regardless of the weight of the evidence. An instruction putting the burden of proof on the defendant is equally infirm. The reasoning of the opinions, however, goes beyond inquiry into presumptions, burdens of proof, and other procedural analogs to a directed verdict. That reasoning would invalidate any instruction or failure to instruct which would permit the state to circumvent the requirement that it prove every fact necessary for conviction beyond a reasonable doubt. (See In re Winship, supra, 397 U.S. 358, 364 [25 L. Ed. 2d 368, 375].) Thus a failure to instruct on the element of intent, because it would permit the jury to find guilt without proof of intent beyond a reasonable doubt, would constitute a denial of due process.
(10) The jury in the present case was instructed that to find a special circumstance of felony murder, "it must be proved that the murder was committed while the defendant was an accomplice in the attempted commission of a robbery." That instruction necessarily implied that the jury could find the special circumstance true even if defendant did not intend to kill or to aid in a killing, but intended only to participate in an attempted robbery. It removed the issue of intent from the jury as effectively as if the jury had been told expressly that intent was not an issue, or was conclusively presumed against defendant. Under the reasoning of Sandstrom, defendant was denied due process of law under the Fourteenth Amendment.
*552 (11) Seeking to distinguish Sandstrom, the Attorney General argues that a special circumstance is not a "crime," and an element of a special circumstance thus is not an "element of a crime." His argument is technically sound; special circumstances are sui generis neither a crime, an enhancement, nor a sentencing factor. We have, however, noted the resemblance between a special circumstance proceeding and a trial to determine guilt. In People v. Superior Court (Engert) (1982) 31 Cal. 3d 797, 803 [183 Cal. Rptr. 800, 647 P.2d 76], we said: "In the California scheme the special circumstance is not just an aggravating factor: it is a fact or set of facts, found beyond reasonable doubt by a unanimous verdict (Pen. Code, § 190.4), which changes the crime from one punishable by imprisonment of 25 years to life to one which must be punished either by death or life imprisonment without possibility of parole. The fact or set of facts to be found in regard to the special circumstance is not less crucial to the potential for deprivation of liberty on the part of the accused than are the elements of the underlying crime which, when found by a jury, define the crime rather than a lesser included offense or component." (Fn. omitted.) Engert therefore held that the standards of specificity applicable to statutes defining criminal offenses applied equally to special circumstances. On similar grounds Ghent v. Superior Court (1979) 90 Cal. App. 3d 944 [153 Cal. Rptr. 720] rejected the claim that special circumstances are analogous to enhancements and held that, like criminal charges, a special circumstance allegation could be challenged under section 995. We endorsed that holding in Ramos v. Superior Court (1982) 32 Cal. 3d 26, 32-33 [184 Cal. Rptr. 622, 648 P.2d 589].
As we noted in Carlos v. Superior Court, supra, 35 Cal. 3d 131, 134, "[a] finding of murder with special circumstances requires the trier of fact to choose between only two alternatives death or life imprisonment without possibility of parole the most severe punishments permitted under our law." It is, moreover, an essential prerequisite to the imposition of the unique and extreme sanction of death. In view of the importance of a special circumstance finding, we do not believe the courts can extend a defendant less protection with regard to the elements of a special circumstance than for the elements of a criminal charge. If failure to instruct on the element of a crime is a denial of federal due process, the same consequence should attend failure to instruct on the element of a special circumstance.
The test of prejudice for Sandstrom error is yet to be formulated. When the issue reached the United States Supreme Court in Connecticut v. Johnson, supra, 460 U.S. 73 [74 L. Ed. 2d 823, 103 S. Ct. 969], that court divided evenly. Justice Blackmun, joined by Justices Brennan, Marshall, and White, took the position that Sandstrom error would be harmless only in rare cases, such as one in which the defendant conceded the issue of intent; *553 in all other cases, the conviction must be reversed regardless of the weight of the evidence. Justice Powell, joined by the Chief Justice, Justice Rehnquist and Justice O'Connor, argued in favor of the Chapman standard, under which federal constitutional error does not require reversal if "harmless beyond a reasonable doubt." (Chapman v. California (1967) 386 U.S. 18, 24 [17 L. Ed. 2d 705, 711, 87 S. Ct. 824, 24 A.L.R. 3d 1065].) Justice Stevens, the tie-breaking vote, did not address the test of prejudice required by the federal Constitution; he maintained that Connecticut's application of a test requiring per se reversal violated no federal rights even if it went beyond federal constitutional requirements. Justice Stevens thus voted with the majority to affirm the Connecticut court's reversal of defendant's conviction for attempted murder.[8]
The trial court in Connecticut v. Johnson had instructed the jury that "`every person is conclusively presumed to intend the natural and necessary consequences of his act.'" (P. 78 [74 L.Ed.2d at p. 829, 103 S.Ct. at p. 973].) The plurality opinion by Justice Blackmun reasoned that this instruction was the equivalent of a directed verdict on the issue of intent, and that since a directed verdict is impermissible regardless of the weight of the evidence, the conviction must be reversed despite overwhelming evidence of guilt. "An erroneous presumption on a disputed element of the crime renders irrelevant the evidence on the issue because the jury may have relied upon the presumption rather than upon that evidence. If the jury may have failed to consider evidence of intent, a reviewing court cannot hold that the error did not contribute to the verdict." (Pp. 85-86, fn. omitted [74 L.Ed.2d at p. 833, 103 S.Ct. at p. 977].)
The dissent agreed that an instruction which "removes an issue completely from the jury's consideration" (P. 95 [74 L.Ed.2d at p. 839, 103 S.Ct. at p. 982]) would require automatic reversal, but maintained that the instruction given by the Connecticut judge did not go that far. Unlike a directed verdict, argued the dissent, the Connecticut presumption did not take the issue wholly from the jury. That presumption established only that the defendant intended the natural and necessary consequences of his acts, leaving it to the jury to determine the nature of those consequences.
The dissent, as we read it, draws a fine distinction. It concedes that an instruction which operated independently from the evidence, directing or permitting the jury to find intent without examining that evidence, would be reversible per se. On the other hand, it asserts, a presumption which *554 takes effect only if the jury finds certain preliminary facts does not permit the jury to avoid examining the evidence and should therefore be subject to a less stringent standard of prejudice. As Justice Powell explained, "The jury must look to the evidence initially to see if the basic facts have been proved before it can consider whether it is appropriate to apply the presumption.... If ... those basic facts are themselves dispositive of intent, the presumption becomes unnecessary to the jury's task of finding intent. Because the presumption does not remove the issue of intent from a jury's consideration, it does not preclude a reviewing court from determining whether the error was `harmless beyond a reasonable doubt.'" (P. 97 [74 L.Ed.2d at p. 840, 103 S.Ct. at pp. 982-983].)
(8b) The dissent's distinction leads us to conclude that at least eight justices of the United States Supreme Court (all except Justice Stevens, who took no position on the issue) agree that a jury instruction which does take an issue completely from the jury is reversible per se. We have no doubt that they would reach the same conclusion if the error was one of omission failing to submit the issue of intent to the jury. Both forms of error have the same effect: removing the issue wholly from jury determination, and thus denying defendant the right to jury trial on the element of the charge.
(12a) It is clear that the instructional error in the present case completely eliminated the issue of intent to kill from the consideration of the jury. Unlike the presumption at issue in Sandstrom and Connecticut v. Johnson, the instructions here did not require the jury to examine evidence which bore on intent and which might make use of a presumption unnecessary. Instead, the jury was told simply if it found that the murder was committed while defendant was an accomplice to an attempted robbery, it should find the special circumstance true. The only intent relevant to such a finding was defendant's intent to aid in a robbery, and that was already established by defendant's confession. We conclude that the United States Supreme Court would find the error in the present case reversible per se.[9]
(8c) The plurality opinion in Connecticut v. Johnson described two exceptions to its rule of per se reversal: "if the erroneous instruction was given in connection with an offense for which the defendant was acquitted and if the instruction had no bearing on the offense for which he was convicted," *555 and "if the defendant conceded the issue of intent." (P. 87 [74 L.Ed.2d at p. 834, 103 S.Ct. at pp. 977-978].) California experience with a similar test of prejudicial error established in People v. Modesto, supra, 59 Cal. 2d 722,[10] indicates that additional exceptions may be appropriate. In People v. Sedeno, supra, 10 Cal. 3d 703, 721, we explained that "in some circumstances it is possible to determine that although an instruction ... was erroneously omitted, the factual question posed by the omitted instruction was necessarily resolved adversely to the defendant under other, properly given instructions. In such cases the issue should not be deemed to have been removed from the jury's consideration since it has been resolved in another context, and there can be no prejudice to the defendant...."[11] We believe that, in an appropriate case, the United States Supreme Court would accept this exception to the automatic reversal standard.
Two later decisions, People v. Cantrell (1973) 8 Cal. 3d 672, 685 [105 Cal. Rptr. 792, 504 P.2d 1256] and People v. Thornton (1974) 11 Cal. 3d 738 [114 Cal. Rptr. 467, 523 P.2d 267] relaxed the rigidity of the Modesto rule. Cantrell was a murder case in which the defendant had confessed to killing a juvenile who had objected to defendant's sexual advances. The defense was diminished capacity, and the trial court instructed on manslaughter as a lesser offense only as it might be the result of diminished capacity. Defendant objected to the failure to instruct generally on voluntary and involuntary manslaughter. The court rejected that contention, stating that "[t]he rule requiring the court to instruct the jury upon every material question upon which there is any evidence whatsoever deserving of consideration [citing Modesto] does not imply instructions should be given on issues and questions not raised by the evidence." (8 Cal.3d at p. 685.)
People v. Thornton involved the retroactive application of People v. Daniels (1969) 71 Cal. 2d 1119 [80 Cal. Rptr. 897, 459 P.2d 225, 43 A.L.R. 3d 677], which held that substantial asportation which increased the risk of harm to the victim was an element of Penal Code section 209 kidnaping. Thornton was convicted of kidnaping (and many other crimes) before Daniels. *556 The majority, by Justice Sullivan, affirmed the kidnaping conviction on the ground that, on the appellate record, it was clear that the asportation met the Daniels standard. Justice Mosk dissented, arguing that the Modesto rule should apply to instructional error relating to an essential element of the offense. (11 Cal.3d, pp. 771-772.)
The majority responded to the Mosk dissent in a lengthy footnote. (Fn. 20, pp. 768-769.) They stated that "Modesto and Sedeno indeed hold that `a defendant has a constitutional right to have the jury determine every material issue presented by the evidence' ... and that the failure to instruct on such an issue is prejudicial per se. Such a `material issue' is `presented by the evidence' within the meaning of those cases when the record contains `any evidence deserving of any consideration whatsoever' relative to it.... In the instant case we hold as a matter of law that defendant's acts constituted section 209 kidnaping under Daniels ... and that there is no evidence worthy of consideration to the contrary."
In many cases it will be difficult to apply the Cantrell-Thornton analysis to Carlos error. If the defendant in a pre-Carlos trial was unaware that intent to kill was an element of the felony-murder special circumstance, he might through ignorance fail to present evidence worthy of consideration on that matter. We could not in such cases affirm a special circumstance finding on the ground that defendant did not introduce evidence sufficient to raise a material issue. But there may also be cases where the parties recognized that intent to kill was in issue, presented all evidence at their command on that issue, and in which the record not only establishes the necessary intent as a matter of law but shows the contrary evidence not worthy of consideration.[12] In such a case the reasoning of Cantrell and Thornton may avoid a meaningless retrial.
We are uncertain whether the United States Supreme Court will endorse the Cantrell-Thornton exception to its apparent rule favoring automatic reversal. The four dissenting justices in Connecticut v. Johnson, supra, 460 U.S. 73 [74 L. Ed. 2d 823, 103 S. Ct. 969], accused the plurality of requiring "reversals of convictions in many situations in which the defendant's actions establish intent as conclusively as if it were unequivocally conceded." (Pp. 98-99 [74 L.Ed.2d at p. 842, 103 S.Ct. at p. 984].) The plurality did not respond to this charge. The making of the accusation suggests that four justices of the court would be sympathetic to a limited exception that would avoid retrial in some cases in which the evidence unequivocally and conclusively *557 established intent, but leaves it uncertain whether a majority would take that position. Accordingly, pending further guidance from the United States Supreme Court, we will apply the reasoning of Cantrell and Thornton only to those cases clearly falling within the ambit of that reasoning so as not to detract substantially from the per se character of the high court's rule.
(12b) In any event, the present case does not fall within any of the exceptions to automatic reversal. The omitted instruction on intent related to the special circumstance found to be true, not to some crime or special circumstance of which defendant was acquitted. Defendant did not concede intent. The jury did not find that he intended to kill in connection with some other, proper instruction. And the evidence does not come close to establishing intent to kill as a matter of law.
Defendant did not shoot the victim and was not present in the store at the time of the shooting. The fact that he agreed to aid a robbery, knowing his companion was armed, is insufficient to demonstrate that defendant himself intended to aid a killing. (Carlos v. Superior Court, supra, 35 Cal. 3d 131, 151; see Enmund v. Florida (1982) 458 U.S. 782 [73 L. Ed. 2d 1140, 102 S. Ct. 3368].) The testimony of Smith that defendant supplied dum-dum bullets to Sandoval raises the possibility that defendant intended Sandoval would shoot to kill during the robbery. But this testimony is equivocal, raising at best a possible inference of intent to aid a killing, and it comes from a witness whose credibility is in serious doubt. Whatever the scope of the Cantrell-Thornton exception to automatic reversal, it is clear that the case at hand does not fall within that exception. The finding of the felony-murder special circumstance must therefore be reversed.
(13a) Defendant argues that we should not only reverse the special circumstances finding, but should bar retrial on that allegation. He points out that in Carlos, on very similar facts, we held the evidence was insufficient to constitute probable cause to try Carlos on the special circumstance allegations. Recognizing that in many cases tried before Carlos insufficiency of the evidence to show intent to kill might be the result of the prosecution's failure to realize that proof of intent was essential, he argues that his case is different because he was charged with premeditated murder as well as felony murder. Consequently, he argues, in his case the prosecution must be deemed to have introduced all the evidence it had to show intent and premeditation, and since that evidence would be insufficient to support a finding of intent to kill, retrial of that issue is unnecessary.
We agree with the defendant that the evidence presented may be insufficient to support a finding of intent to kill, but think it unrealistic to assume *558 that the prosecution, with a perfect case for proof of felony murder, necessarily presented all available evidence relating to intent. (14) (See fn. 13.), (13b) We therefore reverse the special circumstance finding without directions, permitting the prosecution to seek retrial of that issue.[13]
The judgment convicting defendant of murder and attempted robbery is affirmed, the finding of a special circumstance under Penal Code section 190.2, subdivision (a)(17) is set aside, and the cause is remanded to the superior court for further proceedings.
Kaus, J., Reynoso, J., Grodin, J., and Brown (G.A.), J.,[*] concurred.
BIRD, C.J., Concurring and Dissenting.
I agree with the majority opinion, but I have one significant reservation. I cannot agree with the majority's decision to elevate the reasoning of Cantrell[1] and Thornton[2] to create a categorical exception to the "per se reversal" rule. The majority's newly created "Cantrell-Thornton exception" constitutes a clear invasion by the appellate courts of the exclusive province of the jury.
Justice Mosk, joined by the late Justice Tobriner, pointed out in his dissent in Thornton that the rule set forth in that case was wrong. As Justice Mosk so aptly expressed, Thornton is the classic "hard case" which makes bad law. (Thornton, supra, 11 Cal.3d at p. 783 (dis. opn. of Mosk, J.).) By adopting Thornton here, the majority perpetuate that mistake and substitute this court's judgment for that of the jury.
Under our system of justice, juries alone have been entrusted with the responsibility of determining guilt or innocence. (Weiler v. United States (1945) 323 U.S. 606, 611 [89 L. Ed. 495, 499, 65 S. Ct. 548, 156 A.L.R. 496].) An accused "has a constitutional right to have the jury determine every material issue presented by the evidence. Regardless of how overwhelming the evidence of guilt may be, the denial of such a fundamental right ... is a miscarriage of justice...." (People v. Modesto (1963) 59 *559 Cal.2d 722, 730 [31 Cal. Rptr. 225, 382 P.2d 33]; see also People v. Sedeno (1974) 10 Cal. 3d 703, 720 [112 Cal. Rptr. 1, 518 P.2d 913].)
Even the majority recognize that the courts cannot "extend a defendant less protection with regard to the elements of a special circumstance than for the elements of a criminal charge." (Maj. opn., ante, at p. 552.) However, under the majority's Cantrell-Thornton exception, it is an appellate court that will determine whether the accused entertained the intent to kill required when a felony-murder special circumstance is charged.
The majority apply the Cantrell-Thornton exception to all cases "where the parties recognized that intent to kill was in issue, presented all evidence at their command on that issue, and in which the record not only establishes the necessary intent as a matter of law but shows the contrary evidence not worthy of consideration." (Maj. opn., ante, at p. 556.)
The appellate court will have to divine whether (1) the litigants recognized that an intent to kill was in issue; (2) the parties presented all the evidence at their command; and (3) the evidence established the requisite intent. Giving an appellate court this role undermines the jury's power to determine whether an accused entertained the intent to kill that is a prerequisite to a finding of a felony-murder special circumstance.
The majority recognize that if a jury is not instructed that intent is an element of any felony-murder special circumstance, that issue is essentially removed from a jury's consideration. As a result, the accused is denied the right to a jury trial on an element of the special circumstance allegation. (See maj. opn., ante, at p. 554.) The majority accept a "per se reversal" rule for Carlos[3] error, yet they carve out an exception to that rule as it pertains to the issue of intent in a felony-murder special circumstance allegation. Such a rule defies logic.
The Supreme Court, in Connecticut v. Johnson (1983) 460 U.S. 73 [74 L. Ed. 2d 823, 103 S. Ct. 969], stated that "[i]f the jury may have failed to consider evidence of intent, a reviewing court cannot hold that the error did not contribute to the verdict. The fact that the reviewing court may view the evidence of intent as overwhelming is then simply irrelevant. To allow a reviewing court to perform the jury's function of evaluating the evidence of intent, when the jury never may have performed that function, would give too much weight to society's interest in punishing the guilty and too little weight to the method by which decisions of guilt are to be made." (Id., at p. 86, fn. omitted [74 L.Ed.2d at pp. 833-834, 103 S.Ct. at p. 977], italics *560 added [hereafter Johnson].) Clearly, the Cantrell-Thornton exception would not pass muster under this precedent.[4]
I cannot endorse a holding which substitutes the belief of appellate judges for a jury's finding as to the truth of a special circumstance allegation. (See Bollenbach v. United States (1946) 326 U.S. 607, 615 [90 L. Ed. 350, 355, 66 S. Ct. 402].)
Mosk, J., concurred.
Appellant's petition for a rehearing was denied October 29, 1984, and the opinion was modified to read as printed above. Bird, C.J., and Lucas, J., were of the opinion that the petition should be granted.
NOTES
[1] A dum-dum or wad cutter bullet is a scored or soft-nosed bullet which expands on impact. Such bullets are more lethal than ordinary bullets.
[2] Sandoval was convicted of murder with special circumstances and sentenced to life imprisonment without possibility of parole. Because Sandoval was not yet 18 at the time of the offense, we granted his petition for hearing and retransferred his appeal to the Court of Appeal for reconsideration in light of People v. Spears (1983) 33 Cal. 3d 279 [188 Cal. Rptr. 454, 655 P.2d 1289], which held that a person under 18 is ineligible for special circumstance proceedings.
[3] We omit discussion of the various proceedings relating to the appointment of counsel and defendant's competency to assist counsel, since defendant raised no issue concerning those matters on appeal.
[4] Defendant had been a police informer for over 10 years, mostly in narcotics cases. In return for his assistance, the police had from time to time interceded with the district attorney to help defendant receive favorable treatment when he was arrested on narcotic possession charges. Defendant may have hoped that by cooperating in the present case he would also obtain leniency. The officers informed him, however, that the case involved a robbery-murder, a much more serious matter than defendant's past offenses. They did not promise to speak to the district attorney on his behalf.
[5] Carlos stated: "We do not decide whether this decision will apply retroactively to cases already tried, nor do we determine what test of prejudice controls in a case in which the court erroneously failed to instruct on the necessity for intent to kill in a felony murder special circumstances under the 1978 initiative. Such questions of retroactivity and prejudice, being unnecessary to the decision of the present case, have not been briefed or argued by the parties; we therefore defer resolution of those questions to a later case." (35 Cal.3d at p. 154, fn. 21.)
[6] The tripartite test generally applies only if the decision represented a break from past practice and authority (see Donaldson v. Superior Court, supra, 35 Cal. 3d 24, 38), but has occasionally been applied when the decision resolved a conflict in authority. One example is People v. Yates (1983) 34 Cal. 3d 644 [194 Cal. Rptr. 765, 669 P.2d 1], in which we held that a defendant charged with first degree murder receives 26, not 10, peremptory challenges. We applied our decision prospectively (except for Yates himself and the appellant in a companion case), directing that "whether the trial court anticipated our decision and granted each side 26 challenges, or whether it limited each side to 10 challenges, the present decision should not be employed to overturn the verdict and judgment in those trials or retrials commenced before this decision becomes final." (P. 654.)
Yates involved a unique situation in which the court had to determine the appropriate number of peremptory challenges but recognized that, whatever the determination, the defendant was not denied a fair trial so long as he received as many challenges as the prosecution. Retrial of all cases in which the parties had received only 10 challenges would have imposed a substantial burden on the courts; yet there was no way to discover whether the additional 16 challenges would benefit the defendant more than the prosecution, or reason to believe the additional challenges would have any effect on the outcome of a case. The magnitude of the judicial burden, coupled with the absence of the slightest basis for assuming prejudice, led us to limit the retroactive effect of our decision.
[6A] The question of the application of Carlos to final judgments is not directly presented in this case, and we express no view on that question.
[7] The parties cite other federal cases of lesser moment. The public defender points to Presnell v. Georgia (1978) 439 U.S. 14 [58 L. Ed. 2d 207, 99 S. Ct. 235], which held that it is a denial of due process to convict a defendant upon an offense not charged. (Accord, In re Hess (1955) 45 Cal. 2d 171, 174-175 [288 P.2d 5].) The Attorney General cites Hopper v. Evans (1982) 456 U.S. 605 [72 L. Ed. 2d 367, 102 S. Ct. 2049], which found no denial of due process in a trial court's failure to instruct on a lesser offense of unintentional homicide when the defendant admitted an intentional killing. Both are distinguishable from the present setting, which involves instructions on the special circumstance charged, not an uncharged or lesser crime.
A number of California cases (e.g., People v. Mayberry (1975) 15 Cal. 3d 143, 157-158 [125 Cal. Rptr. 745, 542 P.2d 1337]; People v. Sedeno (1974) 10 Cal. 3d 703, 720 [112 Cal. Rptr. 1, 518 P.2d 913]; People v. Modesto (1963) 59 Cal. 2d 722, 730 [31 Cal. Rptr. 225, 382 P.2d 33]) hold that failure to instruct on the elements of a crime, a lesser included offense, or an affirmative defense constitute a denial of the constitutional right to jury trial. None of the cases distinguishes between the federal and the state constitutional right to jury trial, and none rely on federal authority to frame a test of prejudice.
[8] Since Connecticut v. Johnson did not decide the standard of prejudice, the lower federal circuits have continued to follow their prior cases, most of which employed the Chapman standard. (See Brooks v. Francis (11th Cir.1983) 716 F.2d 780, 794; Engle v. Koehler (6th Cir.1983) 707 F.2d 241, 246; Healy v. Maggio (5th Cir.1983) 706 F.2d 698, 701.)
[9] The recent decision in People v. Beeman (1984) 35 Cal. 3d 547 [199 Cal. Rptr. 60, 674 P.2d 1318] invalidated a form jury instruction which erroneously permitted a person to be convicted as an accomplice without proof that he intended to aid in the commission of the offense. We observed that although the error arising from the failure to require intent "is not identical to a conclusive presumption or to placing the burden of persuasion on the defendant [citing Connecticut v. Johnson], it is just as effective if not more effective in removing the issue of intent from the jury's consideration." (P. 562, fn. 4.)
[10] To avoid possible misunderstanding, we reiterate that we decide the present case on the basis of federal precedent. We take no position on whether, in the absence of controlling federal authority, we would apply the California prejudicial per se test of Modesto or some other, less stringent, test.
[11] This exception is important in special circumstance cases under the 1978 death penalty initiative. While the felony-murder special circumstance (Pen. Code, § 190.2, subd. (a)(17)) was silent on intent to kill, some other special circumstances expressly require an intentional killing. (See, e.g., Pen. Code, § 190.2, subd. (a)(15), which describes as a special circumstance that "[t]he defendant intentionally killed the victim while lying in wait.") If a correctly instructed jury found intent to kill under some other special circumstance, the failure to instruct on intent to kill under the felony-murder special circumstance might not be reversible error.
[12] We note, for example, that the issue of intent may arise in connection with a prosecution attempt to prove first degree murder without reliance on the felony-murder rule, in connection with some special circumstance which expressly requires intent to kill, or at the penalty phase where lack of intent would be a mitigating factor.
[13] Under the circumstances of this case, retrial of the special circumstance allegation is not barred by constitutional protections against double jeopardy. As we explained in People v. Shirley (1982) 31 Cal. 3d 18, 71 [181 Cal. Rptr. 243, 641 P.2d 775], "`reversal for trial error, as distinguished from evidentiary insufficiency, does not constitute a decision to the effect that the government has failed to prove its case.' [Citing Burks v. United States (1978) 437 U.S. 1, 15 (57 L. Ed. 2d 1, 12, 98 S. Ct. 2141).] Rather, the matter is governed by the settled rule that the double jeopardy clause does not prohibit retrial after a reversal premised on error of law."
[*] Assigned by the Chairperson of the Judicial Council.
[1] People v. Cantrell (1973) 8 Cal. 3d 672 [105 Cal. Rptr. 792, 504 P.2d 1256].
[2] People v. Thornton (1974) 11 Cal. 3d 738 [114 Cal. Rptr. 467, 523 P.2d 267].
[3] Carlos v. Superior Court (1983) 35 Cal. 3d 131 [197 Cal. Rptr. 79, 672 P.2d 862].
[4] The majority assert that the four dissenting justices in Johnson would be "sympathetic" (maj. opn., ante, at p. 556) to such an exception. However, the Johnson dissent explicitly distinguished the case it had before it from cases where the jury was prevented from considering the issue of intent. (Johnson, supra, 460 U.S. at pp. 96-97, and fn. 3 [74 L.Ed.2d at p. 840, 103 S.Ct. at pp. 982-983] (dis. opn. of Powell, J.).) Moreover, the dissent indicated that if "an execution-style slaying occurred, in which the defendant tied up his victim and shot him repeatedly in the head, it would be clear beyond a reasonable doubt that the presence of a conclusive presumption instruction would not have affected a jury's finding of intent." (Id., at p. 99 [74 L.Ed.2d at p. 842, 103 S.Ct. at p. 984], italics added.) The dissent's statement was directed only to those cases where the jury had explicitly determined the issue of intent. Thus, it is doubtful that a majority of the Supreme Court would accept the Cantrell-Thornton exception which this court carves out today. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2985379/ | December 5, 2013
JUDGMENT
The Fourteenth Court of Appeals
ANTHONY DEWAYNE GREEN, Appellant
NO. 14-12-00601-CR V.
THE STATE OF TEXAS, Appellee
________________________________
This cause was heard on the transcript of the record of the court below.
Having considered the record, this Court holds that there was no error in the
judgment. The Court orders the judgment AFFIRMED.
We further order this decision certified below for observance. | 01-03-2023 | 09-23-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/2441528/ | 972 S.W.2d 921 (1998)
Dr. George N. STOKES, Appellant,
v.
Lauri PUCKETT, Deann Carlton, and Cheryl Shirley, Appellees.
No. 09-97-070 CV.
Court of Appeals of Texas, Beaumont.
Submitted June 11, 1998.
Decided August 27, 1998.
*923 Dr. George N. Stokes, Kingwood, pro se.
Ross A. Sears, II, Williamson & Sears, Houston, appellees.
Before WALKER, C.J., and BURGESS and STOVER, JJ.
OPINION
BURGESS, Justice.
Lauri Puckett, DeAnn Carlton and Cheryl Shirley (appellees) brought suit against Dr. George N. Stokes for assault and intentional infliction of emotional distress. A jury awarded them actual and punitive damages. Stokes appeals bringing eight points of error. Appellees bring three cross points.
In his first point of error, Stokes alleges the trial court erred in denying his motion for judgment notwithstanding the verdict because the evidence is legally insufficient to support the jury's finding of intentional infliction of emotional distress. In his second point of error, Stokes argues the evidence is factually insufficient to support the jury's finding that he intentionally inflicted emotional distress upon appellees.
The standard of review used to determine the validity of a trial court's granting or refusing a judgment notwithstanding the verdict is the same as that used for review of a "no evidence" claim. Dowling v. NADW Mktg., Inc., 631 S.W.2d 726, 728 (Tex.1982); Purina Mills, Inc. v. Odell, 948 S.W.2d 927, 932 (Tex.App.Texarkana 1997, writ denied). The entry of a judgment notwithstanding the verdict is only proper if there is no evidence from which the jury could have made its findings. Williams v. City of Midland, 932 S.W.2d 679, 682 (Tex.App.El Paso 1996, no writ). When reviewing a challenge to the legal sufficiency of evidence, i.e., a "no evidence" point of error, the reviewing court may consider only the evidence and inferences that support the challenged findings and should disregard all evidence and inferences to the contrary. Leitch v. Hornsby, 935 S.W.2d 114, 118 (Tex.1996); Burroughs Wellcome Co. v. Crye, 907 S.W.2d 497, 499 (Tex.1995). If there is more than a scintilla of evidence to support the finding, the claim is sufficient as a matter of law, and any challenges merely go to the weight of the evidence. Browning-Ferris, Inc. v. Reyna, 865 S.W.2d 925, 928 (Tex.1993).
When considering a factual sufficiency challenge to a jury's verdict, courts of appeals must consider and weigh all of the evidence, not just that evidence which supports *924 the verdict. See Ortiz v. Jones, 917 S.W.2d 770, 772 (Tex.1996); Lofton v. Texas Brine Corp., 720 S.W.2d 804, 805 (Tex.1986). A court of appeals can set aside the verdict only if it is so contrary to the overwhelming weight of the evidence that the verdict is clearly wrong and unjust. See Ortiz, 917 S.W.2d at 772; Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986). The court of appeals is not a fact finder. Accordingly, the court of appeals may not pass upon the witnesses' credibility or substitute its judgment for that of the jury, even if the evidence would clearly support a different result. See Pool v. Ford Motor Co., 715 S.W.2d 629, 634 (Tex.1986).
A plaintiff establishes intentional infliction of emotional distress if he can show: (1) the defendant acted intentionally or recklessly; (2) the conduct was extreme and outrageous; (3) defendant's conduct caused the plaintiff emotional distress; and (4) the emotional distress was severe. Twyman v. Twyman, 855 S.W.2d 619, 621 (Tex.1993). Whether the defendant's conduct may reasonably be regarded as so extreme and outrageous as to permit recovery is initially a question for the court. Wornick Co. v. Casas, 856 S.W.2d 732, 734 (Tex.1993); RESTATEMENT (SECOND) OF TORTS § 46 cmt. h. (1965). Outrageous conduct is that which goes beyond all possible bounds of decency, and is regarded as atrocious, and utterly intolerable in a civilized society. Wornick Co., 856 S.W.2d at 734; RESTATEMENT (SECOND) OF TORTS § 46 cmt. d. Insensitive or even rude behavior does not amount to outrageous behavior. Mattix-Hill v. Reck, 923 S.W.2d 596, 597 (Tex.1996); Natividad v. Alexsis, Inc., 875 S.W.2d 695, 699 (Tex.1994). "Severe emotional distress" means distress so severe that no reasonable person could be expected to endure it. Benavides v. Moore, 848 S.W.2d 190, 195 (Tex.App.Corpus Christi 1992, writ denied). Any party seeking recovery for mental anguish, even when advancing a cause of action that does not require the "severe" damages required for intentional infliction of emotional distress, must prove more than "mere worry, anxiety, vexation, embarrassment, or anger." Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex.1995). However, proof of a physical manifestation of the emotional distress is not required. Krishnan v. Sepulveda, 916 S.W.2d 478, 482 (Tex.1995).
Appellees worked for Stokes at his office in Cleveland, Texas. At trial, Carlton testified that at times Stokes approached her from behind and would put his "hand on her bottom." Carlton testified that this happened in the laboratory at the office four or five times and that she would stiffen and try to get away whenever this occurred. On another occasion, Stokes put his hand on the top of her back and "rubbed it down to the bottom of [her] rear." Additionally, while she was pregnant, Stokes would often walk by her and touch her on the rear as he was passing. Carlton also testified that once when Stokes and his wife were separated, he inquired when her husband would be at work and if she could get a babysitter so that she could come over to his house to "supposedly talk about this interview with this man." Carlton further testified about an incident where she left Stokes a note that said "I need to talk to you as soon as you get a chance." In response to her note, Stokes sat down on her desk and handed her a note which stated "Talk is cheap. I want action." Carlton quit her job because of Stoke's conduct.
Carlton testified that Stokes' actions embarrassed and degraded her and gave her nightmares. Plaintiff's expert Dr. David Axelrad, a psychiatrist who examined and evaluated all three appellees, testified that because of Stokes' conduct, Carlton was suffering from anxiety with symptoms of arousal intrusion, self-deprecation, inferiority, inadequacy, and significant symptoms of depression.
Puckett worked for Stokes for two and one-half months. She testified that during that time, Stokes touched and grabbed her rear end on several occasions. She stated that Stokes told her that he would love to examine her legs. Puckett informed Stokes that she did not appreciate him touching her and making sexual remarks and that she could not work under those circumstances. Stokes replied "That's just the way I am. I like to do stuff like that." He told her that he was attracted to her and wanted to have a *925 personal relationship with her. When she informed him that she could not work under those circumstances, he said "well then I don't guess you can work here for me." She consequently quit her employment with him.
Puckett testified that she was upset and stressed about what happened. She stated she was humiliated because the people in the office overheard what had happened. She further testified that the humiliation is going to last forever and that it will always be with her. She stated she missed some work because of what Stokes had done and that his actions made her physically sick. She suffered from gastrointestinal problems, abdominal pains, vomiting and depression.
Shirley worked as a receptionist for Stokes. At trial she testified that Stokes called her a "bitch" in front of five different staff members. On one occasion while she was in his office, Stokes kept staring at her breasts. She testified his look was "very scary.... It was a look as if he was an animal, and he was about to come after me. And I remember feeling scared talking to him." Stokes then walked around his desk over next to her and while looking down at a chart, brushed his face "across my chest into my breasts." She also testified that Stokes made a sexually suggestive remark while another employee was changing a light bulb.
Shirley stated that Stokes' actions upset her and that she left his office crying quite a few times. She also stated that his actions caused her to shake at her desk and to have occasional diarrhea, headaches and neckaches. Dr. Axelrad testified that Shirley suffered from sleep dysfunction, restlessness, anxiety and depression due to Stokes' actions. He also testified that each of the appellees exhibited signs of depression, anxiety and low self esteem, all attributable to Stokes' actions. In his opinion, all of the appellees needed to seek help for their problems associated with Stokes' behavior and that all suffered from severe mental anguish.
We find the evidence is both legally and factually sufficient to support the jury's finding of intentional infliction of emotional distress. The evidence shows that Stokes acted intentionally or recklessly; that his conduct was extreme and outrageous; that his conduct caused the appellees emotional distress; and that the emotional distress was severe. Additionally, the evidence shows that Stokes' conduct goes beyond all possible bounds of decency, and is utterly intolerable in a civilized society. Stokes' first two points of error are overruled.
In his third and fourth points of error, Stokes alleges the evidence is legally and factually insufficient to support the jury's finding that he committed assault upon appellees and proximately caused them damages. The definition of assault is the same in both civil and criminal law. LaBella v. Charlie Thomas, Inc., 942 S.W.2d 127, 138 (Tex. App.Amarillo 1997, writ denied). The Penal Code defines assault as: (a) A person commits an offense if the person: intentionally or knowingly causes physical contact with another when the person knows or should reasonably believe that the other will regard the contact as offensive or provocative. TEX. PENAL CODE ANN. § 22.01(3)(Vernon 1994).
As outlined above, the evidence reveals that Stokes placed his hands on Carlton's bottom on several occasions. He grabbed Puckett's rear end on more than one occasion and he brushed his head up against Shirley's breasts. We find the evidence is both legally and factually sufficient to support the jury's finding that Stokes assaulted all three appellees. Points of error three and four are overruled.
In his fifth point of error, Stokes contends the evidence is legally and factually insufficient to support the jury's award of damages in jury questions three, four and five.[1] The jury awarded each of the appellees *926 $87,500 in response to questions three, four and five. Shirley received an additional $2,800 for lost wages. The evidence mentioned above concerning the severe emotional distress suffered by all three appellees amounts to more than a scintilla of evidence to support the jury's award for mental anguish. Each appellee testified about problems such as depression, anxiety, embarrassment, lost of self-esteem, humiliation and various physical manifestations of their mental anguish. We find the evidence both factually and legally sufficient to support the jury's award of damages in jury questions three, four and five. Point of error five is overruled.
In his sixth point of error, Stokes complains the trial court erred in allowing into evidence the extraneous testimony of Kandy Olive-Collins and Hope Walters. Over Stokes' objection, the trial court allowed deposition testimony of Collins and Walters to be read to the jury. Collins and Walters are former employees of Stokes who both testified concerning incidents where Stokes touched them or brushed up against them. On appeal, Stokes urges that the testimony should have been excluded in accordance with rules of evidence 403 and 404(b).[2] He states that the testimony was character evidence and was not admissible to prove his conduct and did not fall with the exceptions listed in rule 404(b), and that the probative value of Collins' and Walters' testimony is substantially outweighed by the danger of unfair prejudice, confusion of the issues, misleading the jury, or the needless presentation of cumulative evidence.
We may reverse a judgment based upon admission or exclusion of evidence only where: (1) the trial court erred; and (2) the error was reasonably calculated to cause and did cause the rendition of an improper judgment. Gee v. Liberty Mutual Fire Insurance Co., 765 S.W.2d 394, 396 (Tex.1989); Durbin v. Dal-Briar Corp., 871 S.W.2d 263, 267 (Tex.App.El Paso 1994, writ denied). The trial court's decision to admit or exclude evidence is within its sound discretion. Durbin, 871 S.W.2d at 268. Generally, however, all relevant evidence is admissible. Tex.R. Civ. Evid. 402. A trial court errs in excluding relevant evidence unless some rule or principle requires its exclusion. Id. Rules excluding relevant evidence must be supported by good cause and solid policy reasons. Id. The rules of evidence specifically contemplate admission of the habit or routine practice of a person. Tex.R. Civ. Evid. 406. Such evidence is relevant to prove that the conduct of the person on a particular occasion was in conformity with a habit or routine practice. Id.; See also Underwriters Life Insurance Co. v. Cobb, 746 S.W.2d 810, 815 (Tex.App.Corpus Christi 1988, no writ). The habit or custom of a person doing a particular act is relevant in determining his conduct on the occasion in question. Acker v. Texas Water Commission, 790 S.W.2d 299, 302 (Tex.1990).
In Durbin, the El Paso court reversed the trial court's decision to exclude evidence of the employer's prior bad acts, namely the termination of other employees for filing workers compensation claims. The court remanded the case back to the trial court for admission of the evidence. In support of its finding, the court held that since the evidence sought to be introduced involved the same supervisory personnel, the same work place and the same pattern of conduct, the evidence should be admitted. Id. at 269.
Here, as in Durbin, the testimony of Collins and Walters involves the same supervisory personnel (Stokes), the same work place, *927 and the same pattern of conduct. The testimony is evidence of the habits or customs of Stokes and is relevant in determining his conduct on the occasion in question. The trial court did not err in finding that the testimony in question was relevant and that its probative value was not substantially outweighed by any prejudicial effects.
Additionally, the trial court did not err in overruling Stokes' 404(b) objection because the testimony was admissible to show Stokes' motive, intent, plan, or absence of mistake or accident. Point of error six is overruled.
In his seventh point of error, Stokes alleges the evidence is legally and factually insufficient to support the jury's finding to question 5(b), an award of lost earnings.[3] The jury awarded Shirley $2,800 in lost wages. Shirley testified that she was terminated from her employment when she finally stood up to Stokes. She further testified she remained unemployed for ten months and that she was making approximately $1,400 per month. She specifically calculated her lost wage damages to be $12,600 minus $4,800 in unemployment benefits for a total of $7,800. She added additional miscellaneous lost income associated with her job loss, which amounted to $3,904. Her total lost wage evidence offered at trial was $11,704.
The above evidence is more than a scintilla of evidence to support the jury's finding. Additionally, the evidence is not so contrary to the overwhelming weight of the evidence that the verdict is clearly wrong and unjust. Stokes' seventh point of error is overruled.
In his eighth point of error, Stokes alleges he received ineffective assistance of counsel at trial. Stokes complains that his trial counsel did not adequately interview witnesses prior to trial and that his counsel made little effort to locate and interview specific witnesses as Stokes had requested. Neither the Texas nor United States Constitution guarantees a right to counsel in a civil suit. Harris v. Civil Service Com'n for Mun. Employees of City of Houston, 803 S.W.2d 729, 731 (Tex.App.Houston [14th Dist.] 1990, no writ). While the Sixth Amendment right to effective assistance of counsel is clearly recognized in criminal proceedings, it has not been extended to civil actions. Interest of B.B., 971 S.W.2d 160 (Tex.App.Beaumont 1998, n.w.h.)(not yet reported). Stokes' eighth point of error is overruled.
In their first cross point, appellees allege "the trial court erred in ordering a remittitur of the damages in this matter." The jury awarded each of the plaintiffs $87,500 in actual damages for mental anguish. The trial court granted Stokes' motion for remittitur and reduced this award to $15,000 for each plaintiff.
In reviewing a trial court's order of remittitur, the proper standard of review is factual sufficiency, not abuse of discretion. Larson v. Cactus Util. Co., 730 S.W.2d 640, 641 (Tex.1987); Pope v. Moore, 711 S.W.2d 622, 623-24 (Tex.1986). The court of appeals must examine all of the evidence in the record to determine whether sufficient evidence supports the damage award, upholding a remittitur only if some portion of the award is so factually insufficient or so against the great weight and preponderance of the evidence as to be manifestly unjust. Pope, 711 S.W.2d at 624.
After reviewing the evidence regarding appellees' mental anguish, which we have outlined above, we find that the evidence supporting the $87,500 award is not manifestly unjust or against the great weight and preponderance of the evidence. Appellees presented direct evidence of severe emotional distress. This evidence was barely refuted by Stokes. Appellees' cross point one is sustained.
We do not address appellees' second and third cross points because appellees state in their brief that these two points become "relevant or important if the court, for some reason, remanded this case back to trial."
In summary, Stokes' points of error are overruled. We sustain appellees' first cross point concerning remittitur and reinstate the jury's damage award of $87,500 for each *928 appellee. We do not address appellees' cross points two and three.
AFFIRMED IN PART; REVERSED AND RENDERED IN PART.
NOTES
[1] #3 What sum of money, if paid now in cash, would fairly and reasonably compensate Lauri Puckett for her mental pain and anguish, if any, which resulted from the occurrence in question?
#4 What sum of money, if paid now in cash, would fairly and reasonably compensate Deann Carlton for her mental pain and anguish, if any, which resulted from the occurrence in question?
# 5 What sum of money, if paid now in cash, would fairly and reasonably compensate Cheryl Shirley for her injuries, if any, which resulted from the occurrence in question? Consider the elements of damages listed below and none other. Consider each element separately. Do not include damages for one element in any other element. Do not include interest on any amount of damages you find. (A) Mental pain and anguish (B)Lost wages.
[2] 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 considerations of undue delay, or needless presentation of cumulative evidence. TEX.R. CIV. EVID. 403.
(b) Other wrongs or acts. Evidence of other wrongs or acts is not admissible to prove the character of a person in order to show that he acted in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident. TEX.R. CIV. EVID. 404(b).
[3] Stokes' sole objection at trial to jury question 5(b) was that the evidence was legally and factually insufficient to support the submission of the issue to the jury. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1908512/ | 643 F. Supp. 1434 (1986)
NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., Plaintiff,
v.
CONTINENTAL ILLINOIS CORPORATION, et al., Defendants.
HARBOR INSURANCE COMPANY, et al., Plaintiffs,
v.
CONTINENTAL ILLINOIS CORPORATION, et al., Defendants.
Nos. 85 C 7080, 85 C 7081.
United States District Court, N.D. Illinois, E.D.
September 8, 1986.
*1435 James Hiering, Dennis Waldon, Jeffrey Berkowitz, A. Benjamin Goldgar, Keck, Mahin & Cate, Chicago, Ill., for plaintiff.
Lowell Sachnoff, Barry Rosen, Carolyn Rosenberg Safer, Sachnoff, Weaver & Rubenstein, Chicago, Ill., for FDIC.
MEMORANDUM OPINION AND ORDER[1]
SHADUR, District Judge.
Harbor Insurance Company ("Harbor"), Allstate Insurance Company ("Allstate") and National Union Fire Insurance Company of Pittsburgh, Pa. ("National Union") have sued Continental Illinois Corporation ("CIC"), its subsidiary Continental Illinois National Bank and Trust Company of Chicago ("Bank") and a host of other defendants, seeking to avoid liability under the *1436 directors' and officers' ("D & O") policies (the "Policies") plaintiffs had issued to CIC. Counts I and II of each Complaint[2] ask for a declaratory judgment:
1. rescinding the respective Policies on the ground CIC's financial statements attached to the 1981 Policy renewal applications contained materially false information (Count I); and
2. excluding claims asserted in the underlying substantive litigation from Policy coverage on the ground the 1981 Policy renewal applications falsely asserted CIC's lack of knowledge as to circumstances likely to produce such claims (Count II).
Now Federal Deposit Insurance Company ("FDIC") has moved:
1. for an order under Fed.R.Civ.P. ("Rule") 26(f) limiting discovery as to Count I; and
2. for judgment on the pleadings under Rule 12(c) as to Count II.
For the reasons stated in this memorandum opinion and order, FDIC's motions are granted in full.
Facts[3]
In the spring or summer of 1981 CIC decided to increase its D & O liability coverage from $40 to $100 million (NU ¶ 3; H-A ¶ 3). To that end, on July 9, 1981 CIC submitted a standard-form "RENEWAL PROPOSAL for DIRECTORS AND OFFICERS INSURANCE including COMPANY REIMBURSEMENT (FINANCIAL INSTITUTIONS)" (the "Form Renewal Proposal") to its insurance broker, Rollins Burdick Hunter Co. ("Rollins") (NU Ex. A; H-A Ex. A).[4] In relevant part the Form Renewal Proposal (with CIC's responses indicated by italics) said:
6. Has the Company
* * * * * *
(b) filed or contemplated filing any registration statement with the Securities and Exchange Commission within the past 18 months or within the next twelve months for a public offering of securities (if so furnish a copy of prospectus).
Yes, one. See copy of prospectus item attached.
* * * * * *
11. It is agreed that this renewal proposal is a supplement to the proposal dated June 30, 1978 and that proposal together with this renewal proposal constitute the complete proposal which shall be the basis of the policy and will be attached to and become part of the policy.
12. The undersigned authorized officer of the Company declares that to the best of his knowledge the statements set forth herein are true.
13. Attached and made part of this proposal by reference are two copies of our last Annual Report to Stockholders, two certified copies of the provisions of the Charter or By-Laws covering Indemnification of Directors and Officers and two copies of the Notice to Stockholders and the Proxy Statement for either the last or the next annual meeting. The *1437 Insurer is hereby authorized to make any investigation and inquiry in connection with this proposal as it may deem necessary.
Harbor (the contemplated primary D & O insurer) responded by sending its own proprietary "RENEWAL PROPOSAL FOR DIRECTORS' AND OFFICERS' LIABILITY INSURANCE" (the "Harbor Proposal"), which CIC filled out and submitted to Harbor August 18, 1981 (H-A Ex. B). In relevant part the Harbor Proposal (again with CIC's responses indicated by italics) said:
6. Has the Corporation:
* * * * * *
(b) filed or contemplated filing any registration statement with the Securities and Exchange Commission within the past 18 months or within the next twelve months for a public offering of securities (if so furnish a copy of prospectus)
Yes, one. See copy of prospectus attached.
7.(a) Attach one copy of last Annual Report and latest Interim report.
(b) Attach one copy of Notice of Stockholders and the Proxy Statement for either the last or the next annual meeting.
(c) Attach one copy of Form 10K for latest fiscal year (applicable only to 12-g companies under the 1934 Securities and Exchange Act).
8. It is agreed that this renewal proposal is a supplement to the proposal dated 8/15/69 and that proposal together with this renewal proposal shall constitute the complete proposal which shall be the basis of any quotation which may be made.
9. The undersigned authorization [sic] officer of the Corporation declares that to the best of his knowledge the statements set forth herein are true.
On August 24, 1981 Harbor issued to CIC its D & O Policy covering the first $15 million of liability (H-A Ex. H).
National Union responded to the Form Proposal by sending its somewhat different proprietary "DIRECTORS AND OFFICERS LEGAL LIABILITY RENEWAL APPLICATION" (the "National Union Application"), which CIC filled out and submitted to National Union December 16, 1981 (NU Ex. B). In relevant part the National Union Application (also with CIC's responses indicated by italics) said:
6. Attach copies of the following:
Previously provided
(a) Latest annual report
(b) Latest interim financial statement available
(c) Latest 10-K report filed with the SEC (if the Company is publicly traded)
(d) Latest Dunn [sic] & Bradstreet Report
(e) If there has been a change, copy (Certified by Corporate Secretary) of the indemnification provision in the By Laws.
* * * * * *
11. It is agreed that this renewal application is a supplement to the application completed on February 27, 1976. and that application together with this renewal supplement constitute the complete application that shall be the basis of the contract and will be attached to and form part of the policy.
12. It is agreed that the Corporation will file with National Union Fire Insurance Company of Pittsburgh, Pa., as soon as the same become available, a copy of each registration statement and annual or interim report which the Corporation may from time to time file with the Securities and Exchange Commission.
THE UNDERSIGNED AUTHORIZED OFFICER OF THE CORPORATION WARRANTS, AFTER INQUIRY, THAT TO THE BEST OF HIS KNOWLEDGE THE STATEMENTS SET FORTH IN THIS APPLICATION AND ALL OTHER APPLICATIONS PREVIOUSLY SUBMITTED ARE TRUE. *1438 SIGNING OF THIS APPLICATION DOES NOT BIND THE UNDERSIGNED TO COMPLETE THE INSURANCE, BUT IT IS AGREED THAT THIS FORM AND ALL PREVIOUS APPLICATIONS SUPPLIED TO THE UNDERWRITERS SHALL BE THE BASIS OF THE CONTRACT SHOULD A POLICY BE ISSUED, AND IT WILL BE ATTACHED TO THE POLICY.
On December 22, 1981 National Union issued two D & O Policies to CIC, one covering $25 million of liability over the first $25 million and the other covering $15 million of the next $50 million (NU Exs. G and H).[5] Both National Union Policies expressly state:
The Company agrees with the Insured named below, in consideration of the premium paid and subject to all the terms and conditions set forth below that the insurance afforded by this policy shall follow all the terms and conditions of Policy Number To Be Advised issued by The Harbor Insurance Company including all renewals and rewrites thereof.
Northbrook issued its Policy in early September 1981 (H-A Ex. I). Nothing of record indicates what application or proposal form or forms apply to that Policy.[6]
Continental soon decided it needed still more D & O liability coverage, and on December 21, 1982 Harbor issued a further $5 million (the "1982 Policy") over and above the $100 million coverage then in force (H-A ¶ 40 and Ex. J). In the course of obtaining the 1982 Policy CIC Board Chairman Roger Anderson ("Anderson") disclosed, by letter to Harbor (the "Anderson Letter"), the existence of 10 then-pending suits against individual CIC officers or directors and stated (Harbor-Allstate-National Union Mem. Ex. A(8), at 3):[7]
To the knowledge of the undersigned no director or officer has any knowledge or information of any negligent act, error, omission, or breach of duty which he reasonably should expect could give rise to a claim against him.
Count I: False Financial Statements[8]
Count I claims CIC obtained the 1981 Policies through material misrepresentations and omissions as to CIC's and Bank's financial condition. FDIC says discovery as to the accuracy of any financial statements[9] CIC submitted with the Form Renewal Proposal, the Harbor Proposal and the National Union Application should be cut off because CIC never represented those financial statements were accurate.
*1439 Each of the Form Renewal Proposal, the Harbor Proposal and the National Union Application contains a representation of truthfulness:
[1.] The undersigned ... declares that to the best of his knowledge the statements set forth herein are true. [Form]
[2.] The undersigned ... declares that to the best of his knowledge the statements set forth herein are true. [Harbor]
[3.] THE UNDERSIGNED ... WARRANTS, AFTER INQUIRY, THAT TO THE BEST OF HIS KNOWLEDGE THE STATEMENTS SET FORTH IN THIS APPLICATION AND ALL OTHER APPLICATIONS PREVIOUSLY SUBMITTED ARE TRUE. [National Union]
FDIC says those representations in terms refer only to "statements set forth" in the forms themselves[10] and not to financial statements merely "attached" to them. Thus FDIC urges CIC represented or warranted the truth of the answers it gave to specific questions posed by the insurers in the forms, but it did not represent or warrant the truth of the documents it was requested to attach.
In the first place that is a matter of contract construction. FDIC of course points to the general rule ambiguities in insurance contracts are to be construed against the insurer, which had sole control of the contract's drafting and its contents and was in the best position to know what information, representations and warranties were needed to control its risks. Playboy Enterprises, Inc. v. St. Paul Fire & Marine Insurance Co., 769 F.2d 425, 428 (7th Cir.1985) sets out the Illinois law in that respect:
However, if the policy language is ambiguous, a court will construe such ambiguity in favor of the insured since the insurer drafted the policy. State Farm v. Moore, 103 Ill.App.3d [250,] 255, 58 Ill.Dec. [609,] 614, 430 N.E.2d [641,] 646 [(2d Dist.1981)]; Great Central Insurance Co. v. Bennett, 40 Ill.App.3d 165, 171, 351 N.E.2d 582, 588 ([2d Dist.] 1976). This rule of strictly construing ambiguous provisions against the insurer is most rigorously applied in the case of ambiguous exclusionary provisions in which the insurer seeks to limit its liability. State Farm v. Moore, 103 Ill.App.3d at 255, 58 Ill. Dec. at 614, 430 N.E.2d at 646; Dawe's Laboratories v. Commercial Insurance Co., 19 Ill.App.3d 1039, 1049, 313 N.E.2d 218, 225 ([1st Dist.] 1974). Thus, exclusionary provisions are applied to deny the insured coverage only where their terms are clear, definite, and explicit. State Farm v. Moore, 103 Ill. App.3d at 256, 58 Ill.Dec. at 614, 430 N.E.2d at 646.
See also Strzelczyk v. State Farm Mutual Automobile Insurance Co., 138 Ill.App.3d 346, 349-50, 93 Ill. Dec. 20, 22-23, 485 N.E.2d 1230, 1232-33 (1st Dist.1985).
Of course that does not amount to an "insurance companies always lose" rule. But where insurers draft the requirements and exclusions in the absence of bargaining, it is proper they should gain no advantage from their own drafting ambiguities. On that score it is significant that the Form Renewal Proposalobviously a generic form for industrywide usespecifically provided the attached financial statements were to be "made part of this proposal by reference," while the Harbor Proposal and National Union Application contained no such incorporating language. If the financial statements had been "made part of" a proposal, it would have done no violence to the language to hold a warranty or representation as to "statements set forth herein" would extend to those attachments. But neither Harbor nor National Union was satisfied with the Form Renewal Proposal. Each sent back its own form, and those lacked the incorporating language.
Nor is there any basis for the insurers claiming the benefit of the Form Renewal Proposal's language. Each of the Harbor Proposal and the National Union *1440 Application stated it was a supplement to an earlier application (not to the Form Renewal Proposal) and (emphasis added):
[1.] that proposal together with this renewal proposal shall constitute the complete proposal which shall be the basis of any quotation which may be made. [Harbor]
[2.] that application together with this renewal supplement constitute the complete application that shall be the basis of the contract and will be attached to and form part of the policy.[11] [National Union]
That language completely excludes the possibility either Harbor or National Union intended the Form Renewal Proposal to constitute part of the ultimate insurance contracts.[12]
Review of elementary contract-law principles may be useful. Clearly the Form Renewal Proposal was an offer (Metropolitan Life Ins. Co. v. Whitler, 172 F.2d 631, 633 (7th Cir.1949); Reynolds v. Guarantee Reserve Life Insurance Co., 44 Ill.App.3d 764, 767, 3 Ill. Dec. 397, 340, 358 N.E.2d 940, 943 (5th Dist.1976)).[13] Neither Harbor nor National Union responded by accepting that offer. Instead each sent its own form stating terms agreeable to it. Those forms were either (1) counteroffers or (2) rejections coupled with an invitation to submit a new offer. Either way, when CIC filled out and signed (by an officer) the Harbor Proposal and the National Union Applicationneither of which "incorporated" the financial statementsthe Form Renewal Proposal dropped out of the picture.[14]
*1441 None of the force of that analysis is vitiated by the Harbor-Allstate-National Union assertion of an insured's obligation to deal truthfully with an insurer (Apolskis v. Concord Life Insurance Co., 445 F.2d 31, 35 (7th Cir.1971)). By the terms of their own forms, neither Harbor nor National Union asked CIC to represent or warrant[15] the truth of the financial statements. They merely asked the statements be "attached." CIC did that. And it did deal truthfully: It neither lied nor held back information the insurers requested the problem in Apolskis. Its disclosure gave each insurer the opportunity to decide which (if any) of the items so disclosed would be requested as added representations or warranties (over and above the answers to specific application questions).
Again it should be emphasized: Harbor and National Union got just what they asked for, no more, no less. This game was played with their prescribed bat and ball, and they cannot now be heard to complain CIC should have substituted better equipment (Preferred Risk Mutual Insurance Co. v. Hites, 125 Ill.App.2d 144, 152-53, 259 N.E.2d 815, 819-20 (3d Dist.1970)). As the Form Renewal Proposal showed, it was no trick at all for the insurers to extend representations of truthfulness to the attached documents. And this is not a matter of second-guessing or hindsight, for the Form Renewal Proposal (which did call for just such a representation) preceded the corresponding documents prepared by the insurers. Harbor and National Union are hoist on petards of their own design.
It is therefore proper to cut off discovery as to the actual truth or falsity of the 1980 financial statements. Unless CIC represented or warranted the financial statements' accuracy, there can be no question of misrepresentation (contrast Weinstein v. Metropolitan Life Ins. Co., 389 Ill. 571, 577, 60 N.E.2d 207, 210 (1945)). And if the misrepresentation issue drops out, no discovery is needed to determine whether or not CIC characterized the financial statements accurately. Harbor and National Union may perhaps have looked to the financial statements in calculating their risks, but in the circumstances any such reliance is not contractually enforceable. In law, the insurers were bound to rely on their own independent researches.[16]
Count II: False "No Loss Circumstances Assertions
Count II says Harbor-Allstate-National Union should not have to pay out on claims arising from the underlying substantive litigation because CIC's Harbor Proposal and National Union Application falsely asserted CIC was unaware of any circumstances that would give rise to those claims. Harbor, Allstate and National Union reason this way:
1. In 1969 (as to Harbor) and 1976 (as to National Union) CIC submitted applications for D & O coverage (the "1969-1976 Applications"), both containing the language (H-A ¶ 110; NU ¶ 107):
No fact, circumstance or situation indicating the probability of a claim or action against which indemnification is or would be afforded by the proposed insurance is now known to any director *1442 or officer of this company; and it is agreed by all concerned that if there be knowledge of any such fact, circumstance or situation, any claim or action subsequently emanating therefrom shall be excluded from the coverage under the proposed insurance.
2. Each of the Harbor Proposal and the National Union Application expressly incorporated the relevant 1969-1976 Application.
3. That means CIC represented in 1981 it had no knowledge of circumstances or situations indicating the probability of the claims now being asserted in the underlying substantive litigation.
4. That representation was false.
5. Therefore the claims now being asserted in the underlying substantive litigation are excluded from coverage under the Policies.
That analysis, however, falters at the third step.
All the Policies in suit are of the "claims made" variety. They cover claims asserted during the period of coverage, though those claims may have arisen before the insurance took effect.[17] For that reason the insurer has an interest in evaluating (and limiting) its risk up front by obtaining identification of any then-known incipient claims that might be asserted during the coverage period. Hence the "no loss circumstances" representation required in the 1969-1976 Applications.
But neither Harbor nor National Union asked for a new representation of that same kind in 1981. Instead the Harbor Proposal spoke of itself as:
a supplement to the proposal dated 8/15/69 and that proposal together with this renewal proposal shall constitute the complete proposal....
And the National Union Application referred to itself as:
a supplement to the application completed on February 27, 1976 and that application together with this renewal supplement constitute the complete application....
Through that incorporating language, Harbor and National Union say they have a reaffirmation, updated as of 1981, of the representations in the 1969-1976 Applications. But Illinois law is squarely against that position. For over a century it has been clear that representations speak as of the date made, and a reaffirmance of a prior representation reaffirms its truth only as of that date (Schroeder v. Trade Insurance Co. of Camden, 109 Ill. 157, 162 (1883)):
To give the adoption into a policy of an application made at some former time, the effect of a representation as to the present condition of the property insured, it would seem but fair that there shall be some language which will suggest to the mind the idea of representation as to present condition, so that the assured may not, by general language of such adoption, be entrapped into the making of representations he never designed to make.
That doctrine remains Illinois law today: Marshall v. Metropolitan Life Insurance Co., 405 Ill. 90, 100-01, 90 N.E.2d 194, 199 (1950) specifically reaffirmed and applied that language from Schroeder to facts parallel to those in the present cases. And that reflects general insurance-law doctrine, 7 Couch, Cyclopedia of Insurance Law 2d § 36:23, at 450 (1985):
Warranties made at the issuance of an original policy continue binding during the period of renewal but relate only to conditions existing at the time they were made. So a renewal policy, based upon a warranty as to noncancellation of other insurance made in obtaining the original policy, is not avoided by the cancellation of other insurance subsequent to the writing of the original policy, where the breach is based on the original warranty.
Harbor-Allstate-National Union proffer no authority at all to sap the vitality of those *1443 specific holdings and that general authority.
Once again the rule of strict construction against the drafter comes into play. Harbor and National Union asked for representations as to no-loss-circumstances very clearly in the 1969-1976 Applications. They could easily have done so in 1981, but instead they relied (they now say) on an incorporation-by-reference approach, which is most ambiguous at best. In fact, FDIC R. Mem. 4 correctly observes Harbor did get a specific no-loss-circumstances representation in connection with the 1982 Policy the Anderson Letter. At that date it did not rely on prior documents.
True enough, CIC is not the untutored layman portrayed in most insurance cases. Its officers and directors are experienced business people. But that does not argue favorably for a looser construction of the insurers' documents. Even on the assumption there is no inequality of bargaining skill, each party should take just what it bargained for and not rest on self-created ambiguities. Certainly CIC must have had some idea of the risk analysis used by D & O insurers. But equally certainly CIC had no obligation to put whatever sophistication it had at the service of Harbor and National Union (an important part of whose business it is to draft the documents that define the risks they choose to insure). Each side must be assumed to know its own business best. There may be little value in a 1981 reaffirmance that CIC knew of no loss circumstances in 1969 or 1976, but Schroeder and its more recent incarnations teach that is all Harbor and National Union asked for and got.
Finally Harbor-Allstate-National Union Mem. 24 says CIC had a continuing legal duty to advise them of changed conditions materially affecting the risk they assumed. But that rule applies only during the pendency of an applicationthat is, where statements in an application become untrue between the time the application is submitted and the time the policy is issued. That is the rule expressed in the cases Harbor-Allstate-National Union Mem. 24 cites, and it rests on offer-and-acceptance notions (Carroll v. Preferred Risk Insurance Co., 34 Ill. 2d 310, 312, 215 N.E.2d 801, 803 (1966); Western Fire Insurance Co. v. Moss, 11 Ill.App.3d 802, 812-15, 298 N.E.2d 304, 312-14 (1st Dist.1973)).
Here no allegation is made concerning any circumstances represented as true in the Harbor Proposal and the National Union Application but no longer true as of the date the Policies were issuedthere was thus no uncommunicated change in the terms of the offer (the insurance application). Harbor-Allstate-National Union would extend the duty expressed in Carroll and Western Fire forward and backward in time far beyond the doctrine's limits. If Harbor and National Union wanted to know about loss circumstances arising between 1969 or 1976 and 1981, they need only have asked. Indeed the obvious significance of such an inquiry, coupled with their failure to make it directly, cuts strongly against ceding the issue to them by default.
There are no material fact issues as to Count II, and the law is on FDIC's side. Count II is dismissed.
Conclusion
Both FDIC motions are granted. As to Count I, discovery is limited to those issues not concerning the truth or falsity of CIC's 1980 financial statements attached to the Harbor Proposal and the National Union Application (or provided earlier in connection with those two documents). As to Count II, FDIC is granted judgment on the pleadings and that Count is dismissed.
NOTES
[1] Because all this Court's opinions in these cases tend to begin with the same opening description, some means of early differentiation is useful. Solely for that purpose, it is noted this is this Court's ninth written opinion since the cases were reassigned to its calendar.
[2] One Complaint is brought by National Union alone, while Harbor and Allstate are coplaintiffs in the other. For present purposes there is no material difference between the Complaints, and for brevity's sake this opinion will simply:
1. refer to "Count I" and "Count II," treating both Complaints as one, and
2. cite to the Complaints in the form "H-A ¶ " or "H-A Ex." and "NU ¶ " or "NU Ex.."
[3] Rule 12(c) principles require this Court to accept as true all well-pleaded facts alleged in the Complaints (Republic Steel Corp. v. Pennsylvania Engineering Corp., 785 F.2d 174, 177 n. 2 (7th Cir.1986)). FDIC's motions raise no material factual disputes in any event: Their resolution turns on construction of the Policies and the Policy applications themselves.
[4] On its face the Form Renewal Proposal does not show to whom it was submitted. However Harbor-Allstate-National Union Mem. 4 says the Form Renewal Proposal was given to Rollins for use in soliciting insurance bids. While that is a "matter outside the pleadings" in terms of the last sentence of Rule 12(c), it is mentioned here only to fill a gap in the narrative and has no material bearing on this opinion's conclusion. The the extent it does bear on the present issues, it cuts against Harbor-Allstate-National Union in any event, as the later text indicates.
[5] CIC's total $100 million D & O liability package was ultimately divided among five carriers as follows:
1. Harbor (first $15 million);
2. Northbrook Excess & Surplus Insurance Co. ("Northbrook") (next $10 million);
3. National Union (next $25 million);
4. Continental Casualty Co. ($25 million of the second $50 million):
5. National Union ($15 million of the second $50 million); and
6. New England Reinsurance Corporation ($10 million of the second $50 million).
See H-A Ex. J, at 3. Allstate has succeeded to Northbrook's interests (H-A Preamble).
[6] Indeed, in their current briefing neither FDIC nor Harbor-Allstate-National Union refers to the Northbrook Policy at all. H-A ¶ 100 suggests Northbrook simply dealt with Harbor, not directly with CIC.
[7] H-A ¶ 40 refers to CIC's pending-litigation disclosure, but the Complaint does not include the Anderson Letter as an exhibit. Harbor-Allstate-National Union have submitted it on the present motions, and FDIC does not challenge its authenticity. This opinion will treat with the Anderson Letter on the terms stated in n. 4.
[8] At the outset, neither side has addressed the question what state's (or states') laws apply in this diversity action. Though both sides cite authorities from several jurisdictions, Illinois citations predominate. Unless the parties argue otherwise (and they have not), the forum state's substantive law controls (National Association of Sporting Goods Wholesalers, Inc. v. F.T.L. Marketing Corp., 779 F.2d 1281, 1284-85 (7th Cir.1985)). This Court will thereforeconsistently with the litigants' approachtreat Illinois law as controlling here.
[9] That term is used here in a generic sense to mean all 1980 financial statements, annual reports, Forms 10K, prospectuses and related materials CIC attached to the Form Renewal Proposal, the Harbor Proposal and the National Union Application.
[10] As noted, each of the documents speaks of what is "set forth" either "herein" or "in this application and all other applications previously submitted."
[11] [Footnote by this Court] As NU Ex. G shows, the National Union Application (but not the Form Renewal Proposal) was attached to National Union's Policy. By contrast the Harbor Policy (H-A Ex. H) includes neither the Harbor Proposal nor the Form Renewal Proposal as an attachment. That may have been a mere oversight in exhibit preparation, but if not it is conclusive against Harbor, for Ill.Rev.Stat. ch. 73, ¶ 766 ("Section 766") (on which Harbor-Allstate-National Union Mem. 13 relies) says (emphasis added):
No misrepresentation or false warranty made by the insured or in his behalf in the negotiation for a policy of insurance, or breach of a condition of such policy shall defeat or avoid the policy or prevent its attaching unless such misrepresentation, false warranty or condition shall have been stated in the policy or endorsement or rider attached thereto, or in the written application therefor, of which a copy is attached to or endorsed on the policy, and made a part thereof. No such misrepresentation or false warranty shall defeat or avoid the policy unless it shall have been made with actual intent to deceive or materially affect either the acceptance of the risk or the hazard assumed by the company.
Thus even assuming arguendo (1) CIC's financial statements were deemed incorporated into the Harbor Proposal and (2) CIC were deemed to have represented their truthfulness, unless Harbor physically attached the Harbor Proposal to its Policy it would not be entitled to rescission on the basis of alleged misrepresentations as to the financial statements (Economy Fire & Casualty Co. v. Thornsberry, 66 Ill.App.3d 225, 227, 23 Ill. Dec. 13, 15, 383 N.E.2d 780, 782 (5th Dist.1978)). In any case that principle would bar rescission based on representations in the Form Renewal Proposal, even if this opinion were wrong as to the superseded status of that Proposal in the contract negotiations. Nothing of record indicates the Form Renewal Proposal was attached to any of the Policies in suit.
[12] True enough, the National Union Application also says:
THIS FORM AND ALL PREVIOUS APPLICATIONS SUPPLIED TO THE UNDERWRITERS SHALL BE THE BASIS OF THE CONTRACT SHOULD A POLICY BE ISSUED, AND IT WILL BE ATTACHED TO THE POLICY.
But that must be read in conjunction with the earlier language describing "the complete application that shall be the basis of the contract." Each successive renewal incorporates prior renewal applications that had been the bases of prior contracts. That does not mean any application submitted outside the "chain of incorporation" is to be part of the contract, especially where (as here) the relevant provisions of the Form Renewal Proposal conflict with those of the National Union Application. Further, under Section 766 the requirement of physical attachment would still defeat a claim based on representations in the Form Renewal Proposal.
[13] It would not alter matters that the Form Renewal Proposal was used by Rollins as a means of soliciting bids (see n. 4). Any insurer was free to retain the Proposal's language in the insurer's bid, and it is surely reasonable to treat the non-retention as significant.
[14] Such conventional offer-and-acceptance analysis ascribes relevance to any language changes from offer to counteroffer, though a contracting party's changes that operate against its own interest do fit a little awkwardly into that notion. What is plainly relevant for current purposes, though, is that the incorporation-by-reference language was tendered to the insurers, was available to them and was not used by any of them.
[15] Though the Harbor Proposal reads in "representation" terms while the National Union Application uses "warranty" language, Section 766 puts those two terms on an equal footing (Anderson v. John Hancock Mutual Life Insurance Co., 316 Ill.App. 338, 342, 45 N.E.2d 39, 41 (1st Dist.1942); see also Ehrenzweig & Kessler, Misrepresentation and False Warranty in the Illinois Insurance Code, 9 U.Chi.L.Rev. 209, 212 (1942) (quoting comments of the Illinois Insurance Code Annotating Committee)).
[16] In that respect, the Form Renewal Proposal had also invited any further investigation and inquiry the insurers wanted to make:
13.... The Insurer is hereby authorized to make any investigation and inquiry in connection with this proposal as it may deem necessary.
[17] At the other end of the spectrum, the Policies do not cover claims that arise during the effective period but are not asserted until after coverage lapses. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2163151/ | 301 A.2d 273 (1972)
ALL-STATE INVESTIGATION AND SECURITY AGENCY, INC., a corporation of the State of Delaware, and Harleysville Mutual Insurance Company, a corporation of the State of Pennsylvania, Plaintiffs-Below, Appellants,
v.
TURNER CONSTRUCTION COMPANY, a corporation of the State of New York, and Liberty Mutual Insurance Company, a corporation of the State of Massachusetts, Defendants-Below, Appellees.
Supreme Court of Delaware.
December 28, 1972.
F. Alton Tybout and Richard W. Pell, of Tybout, Redfearn & Schnee, Wilmington, for appellants.
Wayne N. Elliott, of Prickett, Ward, Burt & Sanders, Wilmington, for appellees.
WOLCOTT, C. J., and CAREY and HERRMANN, JJ., sitting.
WOLCOTT, Chief Justice:
This is an appeal from the entry of a summary judgment for appellee, defendant below, Turner Construction Co. ("Turner") *274 in a declaratory judgment action brought by appellant All-State Investigation and Security Agency, Inc. ("All-State").
Turner was the general contractor for an office building being constructed in Wilmington. Turner engaged All-State to provide security protection during the course of construction. The agreement between Turner and All-State contained the following exculpatory clause:
"The Subcontractor hereby assumes entire responsibility and liability for any and all damage or injury of any kind or nature whatever (including death resulting therefrom) to all persons, whether employees of the Subcontractor or otherwise, and to all property caused by, resulting from, arising out of or occurring in connection with the execution of the work; and if any claims for such damage or injury (including death resulting therefrom) be made or asserted, whether or not such claims are based upon Turner's alleged active or passive negligence or participation in the wrong or upon any alleged breach of any statutory duty or obligation on the part of Turner, the Subcontractor agrees to indemnify and save harmless Turner, its officers, agents, servants and employees from and against any and all such claims, and further from and against any and all loss, costs, expense, liability, damage or injury, including legal fees and disbursements, that Turner, its officers, agents, servants or employees may directly or indirectly sustain, suffer or incur as a result thereof and the Subcontractor agrees to and does hereby assume, on behalf of Turner, its officers, agents, servants, and employees, the defense of any action at law or in equity which may be brought against Turner, its officers, agents, servants or employees upon or by reason of such claims and to pay on behalf of Turner, its officers, agents, servants and employees, upon its demand, the amount of any judgment that may be entered against Turner, its officers, agents, servants or employees in any such action. In the event that any such claims, loss, costs, expense, liability, damage or injury arise or are made, asserted or threatened against Turner, its officers, agents, servants or employees, Turner shall have the right to withhold from any payments due or to become due to the Subcontractor an amount sufficient in its judgment to protect and indemnify it and its officers, agents, servants and employees from and against any and all such claims, loss, cost, expense, liability, damage or injury, including legal fees and disbursements or Turner, in its discretion, may require the Subcontractor to furnish a surety bond satisfactory to Turner guaranteeing such protection, which bond shall be furnished by the Subcontractor within five (5) days after written demand has been made therefor."
While in the course of his employment, an All-State employee was injured at the construction site.
Pursuant to the aforequoted exculpatory clause, Turner demanded that All-State defend Turner in any action brought by the employee and further that All-State indemnify Turner for any judgment the employee might recover. All-State refused and brought this declaratory judgment action, asserting its nonliability under the clause. The Superior Court entered a summary judgment for Turner, from which All-State appeals. Turner settled with the injured employee; and, consequently, the only relief it is entitled to now is indemnification.
All-State argues that it is not liable under the exculpatory clause since public policy bars recovery under exculpatory clauses in contracts between contractors and subcontractors which save the contractor harmless from liability for its own negligence. We recently had occasion to consider the validity of such exculpatory clauses in State v. Interstate Amiesite Corp., Del.Supr., 297 A.2d 41 (1972). In that case we held that such clauses would *275 be given effect if they were "crystal clear and unequivocal in requiring the contractor to assume all liability for damage claims, whichever party may have been guilty of the negligence which actually caused the injury."
The Amiesite test governs the clause before us now. The instant clause, we think, is sufficiently clear and unequivocal and requires All-State to indemnify Turner. The crucial language is All-State's assumption of liability for claims "whether or not such claims are based upon Turner's alleged active or passive negligence or participation in the wrong or upon any alleged breach of any statutory duty or obligation on the part of Turner..."
We therefore hold that public policy does not prohibit the clause in this case from being given effect. In so doing, we note that the unequivocal language in the Turner/All-State agreement contrasts sharply with the language of the clause in Amiesite,[*] which did not expressly provide for indemnification for injuries resulting from acts of the contractor.
All-State argues that even if public policy does not prevent the clause from being given effect, 6 Del.C. § 2704[**] bars the clause. In Wenke v. Amoco Chemicals Corp., Del.Super., 290 A.2d 670 (1972), the Superior Court held that the statute applied only to planning stages and not to actual construction stages. We approved, in dictum, the Wenke holding in our Amiesite *276 Opinion. We now hold that 6 Del.C. § 2704 is inapplicable as between contractors and subcontractors involved in the actual construction process.
Finally, All-State's insurer, Harleysville Mutual Insurance Company, issued a certificate of insurance to Turner which reflected coverage of All-State for the "Contractual Liability covering Agreement between the two Parties". Accordingly, it is estopped to deny coverage of the occurrence as set forth in the agreement between Turner and All-State. See Wilson v. American Insurance Co., Del. Supr., 209 A.2d 902 (1965).
The decision of the Court below is affirmed.
NOTES
[*] contractor shall idemnify and save harmless the Department, its officers and employees, from all suits, actions, or claims of any character brought because of any injuries or damage received or sustained by any person, persons, or property on account of the operations of the said contractor; or on account of or in consequence of any neglect in safeguarding the work; or through use of unacceptable materials in constructing the work; or because of any act or omission, neglect, or misconduct of said contractor; or because of any claims or amounts recovered from any infringements of patent, trademark, or copyright; or from any claims or amounts arising or recovered under the `Workmen's Compensation Act,' or any other law, ordinance, order, or decree; and so much of the money due the said contractor under and by virtue of his contract as may be considered necessary by the Department for such purpose may be retained for the use of the State; or, in case no money is due, his surety may be held until such suit or suits, action or actions, claim or claims for injuries or damages as aforesaid shall have been settled and suitable evidence to that effect furnished to the Department; except that money due the contractor will not be withheld when the contractor produces satisfactory evidence that he is adequately protected by public liability and property damage insurance."
[**] A covenant, promise, agreement or understanding in, and in connection with or collateral to, a contract or agreement (including but not limited to a contract or agreement with the State, any County, municipality or political subdivision of the State, or with any agency, commission, department, body or board of any of them, as well as any contract or agreement with a private party or entity) relative to the construction, alteration, repair or maintenance of a road, highway, driveway, street, bridge or entrance or walkway of any type constructed thereon, and building, structure, appurtenance or appliance, including without limiting the generality of the foregoing, the moving, demolition and excavating connected therewith, purporting to indemnify or hold harmless architects, engineers, surveyors, owners or others, or their agents, servants and employees for damages arising from liability for bodily injury or death to persons or damage to property caused by or resulting or arising from or out of the negligence of such architect, engineer, surveyor, owner or others than the promisor or indemnitor, of their agents, servants or employees, or without limiting the generality of the foregoing, caused by or resulting or arising from or out of defects in maps, plans, designs, specifications prepared, acquired or used by such architect, engineer, surveyor, owner, or others than the promisor or indemnitor, or their agents, servants or employees, is against public policy and is void and unenforceable.
"(b) Nothing in subsection (a) of this section shall be construed to void or render unenforceable policies of insurance issued by duly authorized insurance companies and insuring against losses or damages from any causes whatsoever." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1122100/ | 348 P.2d 541 (1959)
A.K. McBRIDE CONSTRUCTION COMPANY, a corporation, Plaintiff in Error,
v.
ARKHOMA STEEL ERECTION COMPANY, a corporation, Defendant in Error.
No. 38337.
Supreme Court of Oklahoma.
October 20, 1959.
Rehearing Denied December 8, 1959.
Application for Leave to File Second Petition for Rehearing Denied January 26, 1960.
Doerner, Rinehart & Stuart, William P. Huckin, Jr., Tulsa, for plaintiff in error.
Dyer, Powers & Gotcher, Harry L. Dyer, William K. Powers, Deryl L. Gotcher, Thomas G. Marsh, Tulsa, for defendant in error.
*542 PER CURIAM.
A.K. McBride Construction Company alleged in its petition that it is and was an Arkansas Corporation qualified to do business in Oklahoma. That the defendant at the time the cause of action arose August 17, 1955, was an Oklahoma Corporation under the name of Jess Bailey, Inc., but its *543 Articles of Incorporation were amended October 28, 1955, whereby Jess Bailey, Inc., became Arkhoma Steel Erection Company. That plaintiff entered into an oral contract with defendant whereby plaintiff delivered its Lima Paymaster machine and furnished an operator to defendant upon an agreed rental of $15 per hour for an indefinite period of time, and then to be returned to plaintiff in good condition; that the operator of the machine was to be at all times under the direct control and supervision of defendant and in the special service of defendant; that while the machine was in the custody of defendant it was damaged; that the necessary and reasonable cost of repairs, including freight, on parts amounted to $1,144.66, and in addition thereto plaintiff was required to haul the damaged machine from Springdale, Arkansas to Fort Smith, Arkansas at a cost of $20, whereby plaintiff was damaged in the sum of $1,164.66.
The defendant in its answer, asserted that it did rent the machine from the plaintiff at a rate of $15 per hour and that as a condition of renting said machine, the plaintiff required and demanded that its own employee be used in the operation of the machine and that the injuries or damage caused to the machine were caused solely by reason of the negligence and inexperience of the operator who at the time was the servant, agent and employee of McBride and that Arkhoma was without authority or jurisdiction to direct and control the manner in which the machine was being operated by McBride's employee.
Trial by jury was waived by the parties and the cause was submitted to the court. After finding generally in favor of the defendant, judgment was entered for the defendant. After motion for new trial was overruled, the plaintiff perfected this appeal. The parties will be referred to as they appeared in the trial court.
Plaintiff contends the evidence shows that the machine was damaged solely by the negligence of defendant's riggers, and then states even if the evidence could possibly be construed as indicating any negligence on the part of the operator, the result would be no different, in that the defendant is still responsible because the operator at the time the machine turned over with the resulting damage was the special servant and employee of defendant. Thus, regardless of whether the operator of the machine was or was not negligent, the defendant is liable to plaintiff for the damage to the machine; that the riggers and operator of the machine were both employees of defendant and defendant is liable for their negligence. The contention of the defendant is that the relationship between the operator and defendant was that of an independent contractor and the operator at no time became the special servant or employee of the defendant; that the damage to the machine was the proximate result of and caused solely by the inexperience and negligence of the operator. Thus, the evidence presented a question of fact to be determined by the trial judge. See New v. McMillan, 79 Okl. 70, 191 P. 160; Palmer v. Skelly Oil Co., 129 Okl. 32, 263 P. 440; and City of Tulsa v. Randall, 174 Okl. 630, 52 P.2d 33. Under these circumstances, a review of the evidence is necessary.
Plaintiff's testimony disclosed it rented a Lima Paymaster ¾ yard machine to the defendant to pick up, move and set some tanks on a job at Springdale, Arkansas, for an agreed price of $15 per hour with the plaintiff furnishing and paying the operator of the machine. George Capps, the employee designated by plaintiff to operate the machine, reported to the foreman on the job; two tanks were moved and set in place. On the third tank, the riggers directed the picking up of the tank, the setting of the boom and directed Capps to walk the machine up the same incline he had used in moving the other two tanks; that in walking the machine, it toppled and fell over backwards. Capps also testified the boom was too straight up to walk up the incline but he followed the signals of the riggers; that with the boom that straight up it was dangerous but he did not make any suggestions or do anything about it, although he *544 felt he was doing wrong. That, had the boom been lower, the accident would not have happened.
Barney McMahon, a crane operator for defendant testified he saw the machine moving the tank at the time of the accident; that an operator usually follows the directions of the riggers but he uses his discretion at times; that he would follow the directions of the rigger if he felt it was safe. Leslie Smith testified he was a rigger and was giving directions to the operator the morning the accident occurred; that the load was boomed about the way the other two were and the machine started up grade and that the grade was not too steep.
From the record it appears the operator had complete and exclusive control of the machine and the operation thereof. The riggers, employees of the defendant, were assigned to assist him. In assisting him, they, by hand signals, "spotted" the machine where the tank could be picked up. After securing the lines around the tank, they gave signals to the operator to pick it up and then directed him where to set the tank. At no time did any of the riggers have anything to do with the operation of the machine. Defendant had no authority to discharge or replace the operator; only plaintiff had that right.
It is true that one who is the general employee of another may be loaned or hired by the master to another for some special service so as to become, as to that service, an employee of such third party. This was our holding in the case of Wylie-Stewart Machinery Co. v. Thomas, 192 Okl. 505, 137 P.2d 556. It is equally true that one who is a general employee may be loaned or hired by the master to another for some special service but still remain the employee of the master without ever becoming the employee of such third party. Under the facts presented in the case of Hodges v. Holding, 204 Okl. 327, 229 P.2d 555, we held the employee remained the employee of the master and did not become the employee of the third party.
The trial judge, by making a general finding in favor of the defendant, impliedly found that the operator of the machine at no time became the special servant or employee of the defendant. We have repeatedly held that where a judgment is based on a general finding, the judgment is deemed to include a special finding on any and all issues necessary to sustain the judgment. Anderson v. Hill, 205 Okl. 561, 239 P.2d 1016; Cloud v. Winn, Okl., 303 P.2d 305; Staner v. McGrath, 174 Okl. 454, 51 P.2d 795; Rain v. Balph, Okl., 293 P.2d 359; Wahby v. Renegar, 199 Okl. 191, 185 P.2d 184.
Where a jury is waived in an action at law and the cause is tried to the court, the judgment rendered will not be reversed on appeal if there is any evidence reasonably tending to support the judgment. See Trailmobile, Inc. v. Yoder, Okl., 292 P.2d 163; Givens v. Western Paving Co., Okl., 261 P.2d 450; Williams v. Garrett, 208 Okl. 53, 254 P.2d 369.
We find there is competent evidence reasonably tending to support the judgment of the trial court and the same is hereby affirmed.
The Court acknowledges the aid of Supermumerary Judge N.S. CORN in the preparation of this opinion. After a tentative opinion was written, the cause was assigned to a Justice of this Court. Thereafter, upon report and consideration in conference, the foregoing opinion was adopted by the court. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1135732/ | 698 So. 2d 618 (1997)
Frank V. PURRELLI, Appellant,
v.
STATE FARM FIRE AND CASUALTY COMPANY, Appellee.
No. 96-03053.
District Court of Appeal of Florida, Second District.
August 29, 1997.
*619 Peter N. Meros of Meros, Smith & Olney, P.A., St. Petersburg, for Appellant.
Charles W. Hall of Fowler, White, Gillen, Boggs, Villareal and Banker, P.A., St. Petersburg, for Appellee.
BLUE, Judge.
Frank V. Purrelli, a chiropractor, challenges the granting of a judgment on the pleadings in favor of State Farm Fire and Casualty Company in an action for a declaratory judgment. The trial court ruled that the personal umbrella liability insurance policy issued by State Farm to Purrelli did not provide coverage for an invasion of privacy claim asserted against Purrelli. The umbrella policy provides coverage for specified intentional torts, including invasion of privacy, but excludes coverage for intended acts. We determine the policy is ambiguous and therefore reverse the judgment on the pleadings.
Purrelli allegedly took inappropriate videos of a female employee, who was also a patient, during chiropractic treatment sessions. When the employee learned about the videos, she sued Purrelli for invasion of privacy by intrusion upon seclusion. Purrelli called upon State Farm to provide coverage for the claim. Purrelli had three separate insurance policies in force with State Farm: a homeowners policy, a business policy, and a personal umbrella liability policy. State Farm sought a declaratory judgment to determine whether any of its policies provided insurance coverage for the claims asserted against Purrelli. The trial court granted State Farm's motion for a judgment on the pleadings, finding none of the policies provided Purrelli with coverage for the asserted claims.
In response to State Farm's declaratory action, Purrelli based his claim for coverage exclusively on his personal umbrella liability policy. That policy purported to limit insurance coverage to "accidents" which result in "personal injury." The policy defined personal injury to explicitly include "invasion of rights of privacy" and eleven other intentional torts, including assault and battery, false arrest, false imprisonment, libel, slander, and defamation of character. The policy contained a provision excluding personal injuries that were "expected or intended" by the insured.
We conclude the trial court erred by granting State Farm's motion for a judgment on the pleadings because State Farm's personal umbrella liability policy is ambiguous. *620 The policy purports to insure invasion of privacy, an intentional tort, but excludes acts "intended" by the insured and limits coverage to "accidents." If an insurance policy is ambiguous, the ambiguity must be resolved liberally in favor of the insured. See Prudential Property & Cas. Ins. Co. v. Swindal, 622 So. 2d 467, 472 (Fla.1993). Florida case law does not allow insurers to "use obscure terms to defeat the purpose for which a policy is purchased." Weldon v. All American Life Ins. Co., 605 So. 2d 911, 915 (Fla. 2d DCA 1992).
When considering a motion for judgment on the pleadings, all material allegations of the opposing party's pleadings are to be taken as true, and all those of the movant which have been denied are taken as false. See Farag v. National Databank Subscriptions, Inc., 448 So. 2d 1098, 1100 (Fla. 2d DCA 1984). Any ambiguities in an insurance contract must be construed liberally in favor of the insured and strictly against the insurer who prepared the policy. See Swindal, 622 So.2d at 472; Florida Farm Bureau Ins. Co. v. Birge, 659 So. 2d 310, 311 (Fla. 2d DCA 1994), review denied, 659 So. 2d 271 (Fla. 1995). Exclusionary clauses in insurance policies are construed more strictly than coverage clauses. See Birge, 659 So.2d at 311; Triano v. State Farm Mut. Auto. Ins. Co., 565 So. 2d 748, 749 (Fla. 3d DCA 1990).
We have not found, nor have the parties cited, any controlling Florida authority addressing the exact issue before this court. Of the Florida cases involving personal umbrella liability policies which provide explicit coverage for specified intentional torts, none was decided based on a contractual exclusion for intentional conduct. See Ladas v. Aetna Ins. Co., 416 So. 2d 21, 22-23 (Fla. 3d DCA 1982); Continental Cas. Co. v. Schaubel, 380 So. 2d 483 (Fla. 3d DCA 1980); Federal Ins. Co. v. Applestein, 377 So. 2d 229 (Fla. 3d DCA 1979). Courts in other jurisdictions have considered personal umbrella liability policies that provide coverage for specified intentional torts but exclude coverage for intentional acts, and found the exclusions to be ambiguous.
The Maryland Court of Appeals held that conflicting provisions in a personal umbrella liability policy similar to Purrelli's could not be reconciled because the limitation and the exclusion completely swallowed up the insuring provision, creating "the grossest form of ambiguity." Bailer v. Erie Ins. Exchange, 344 Md. 515, 687 A.2d 1375, 1380 (1997) (finding coverage for a claim of invasion of privacy). When limitations or exclusions completely contradict the insuring provisions, insurance coverage becomes illusory. See Lineberry v. State Farm Fire & Cas. Co., 885 F. Supp. 1095, 1099 (M.D.Tenn.1995) (finding a personal umbrella liability policy similar to Purrelli's to be ambiguous and finding coverage for an invasion of privacy claim). As one court observed, an insurance policy that provides coverage for specifically enumerated intentional torts, but only if they are committed unintentionally, is "complete nonsense." Lincoln Nat'l Health & Cas. Ins. Co. v. Brown, 782 F. Supp. 110, 112-13 (M.D.Ga.1992).
Florida courts have recognized invasion of privacy to be an intentional tort. See Chase Manhattan Inv. Servs., Inc. v. Miranda, 658 So. 2d 181, 182 (Fla. 3d DCA 1995). The tort of invasion of privacy was first recognized in Florida in Cason v. Baskin, 155 Fla. 198, 20 So. 2d 243 (1944), and was subsequently found to include intrusion upon seclusion. See Agency for Health Care Admin. v. Associated Indus. of Fla., Inc., 678 So. 2d 1239, 1252 n. 20 (Fla.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 1245, 137 L. Ed. 2d 327 (1997); Loft v. Fuller, 408 So. 2d 619, 622 (Fla. 4th DCA 1981). The Restatement (Second) of Torts defines intrusion upon seclusion as "[o]ne who intentionally intrudes, physically or otherwise, upon the solitude or seclusion of another." Restatement (Second) of Torts § 652B (1977) (emphasis added). Intrusion upon seclusion must always be intentional to be tortious and cannot arise from a mere lack of due care. See Bailer, 687 A.2d at 1384; Snakenberg v. Hartford Cas. Ins. Co., 299 S.C. 164, 383 S.E.2d 2 (Ct.App.1989). Because invasion of privacy can only be actionable if done intentionally, State Farm's insurance contract providing coverage for invasion of privacy but excluding intentional acts is, at best, unclear and ambiguous.
*621 State Farm's attempt to distinguish an "intentional" invasion of privacy from an "accidental" invasion of privacy is also without merit. State Farm failed to define the term "accident" in its insurance contract. The Florida Supreme Court has recognized that, when not otherwise defined, the term "accident" in an insurance policy means "unintentional." See Dimmitt Chevrolet, Inc. v. Southeastern Fidelity Ins. Corp., 636 So. 2d 700, 704 (Fla.1993) ("[t]he term accidental is generally understood to mean unexpected or unintended"); Byrd v. Richardson-Greenshields Sec., Inc., 552 So. 2d 1099, 1100 n. 3 (Fla.1989) (citing with approval the Webster's Third New International Dictionary definition for "accident" as a "sudden event or change occurring without intent or volition"); Government Employees Ins. Co. v. Novak, 453 So. 2d 1116, 1118 (Fla.1984) (if act is intentional, "it can reasonably be said that it was not an `accident'"). Because an accident is by definition unintentional, an insurance contract that explicitly covers the intentional tort of invasion of privacy but limits coverage to "accidents" is ambiguous.
State Farm's argument relies primarily on case law addressing business or homeowners insurance policies that exclude intentional acts. See Prasad v. Allstate Ins. Co., 644 So. 2d 992 (Fla.1994); Swindal, 622 So. 2d 467; Landis v. Allstate Ins. Co., 546 So. 2d 1051 (Fla.1989); State Farm Fire & Cas. Co. v. Compupay, Inc., 654 So. 2d 944 (Fla. 3d DCA), review denied, 662 So. 2d 341 (Fla. 1995); Insurance Co. of North America v. Querns, 562 So. 2d 365 (Fla. 2d DCA 1990); McCullough v. Central Fla. YMCA, 523 So. 2d 1208 (Fla. 5th DCA 1988), approved, 546 So. 2d 1050 (Fla.1989). However, none of these cases contain an insurance policy which provides explicit coverage for a specified intentional tort such as invasion of privacy.
Purrelli's umbrella liability policy with State Farm is ambiguous because the policy purports to provide coverage for specified intentional torts, including invasion of privacy, but attempts to limit coverage to accidents and exclude intentional acts. Therefore, the trial court erred by granting State Farm's motion for judgment on the pleadings. The declaratory judgment is reversed as to the personal umbrella policy, and the matter is remanded to the trial court for further proceedings.
Reversed and remanded.
PATTERSON, A.C.J., and LAZZARA, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1138606/ | 785 P.2d 801 (1990)
100 Or.App. 256
STATE of Oregon, Respondent,
v.
Thomas Reuben MARTIN, Appellant.
C88-02-30931; CA A49620.
Court of Appeals of Oregon.
Argued and Submitted September 29, 1989.
Decided January 17, 1990.
Peter Gartlan, Salem, argued the cause for appellant. With him on the brief was Gary D. Babcock, Public Defender, Salem.
Timothy Sylwester, Asst. Atty. Gen., Salem, argued the cause for respondent. With him on the brief were Dave Frohnmayer, Atty. Gen., Virginia L. Linder, Sol. Gen., and Jonathan H. Fussner, Asst. Atty. Gen., Salem.
Before GRABER, P.J., and RIGGS and EDMONDS, JJ.
PER CURIAM.
Defendant appeals from his convictions for driving under the influence of intoxicants, delivery of methamphetamine, and possession of methamphetamine. ORS 813.010; ORS 475.992. He assigns as error the denial of his motion to suppress.
Officer Lish saw defendant slumped over the steering wheel of a car in a store parking lot. The car's engine was running. She went over "to make sure [that defendant was] all right." "I didn't know if he was sick or asleep or what." When her tapping on the window received no response, she opened the car door and shook defendant's shoulder. She smelled alcohol and observed other signs of intoxication and arrested defendant for DUII. A search incident to that arrest led to the discovery of the methamphetamine that is the basis for the other convictions.[1] The trial court found that the officer was "inquir[ing] into the well-being of the defendant," and the evidence supports that characterization. Where, as here, the officer's sole aim is to render emergency assistance, "incriminating evidence arising from the intrusion by law enforcement officers must be suppressed." State v. Bridewell, 306 Or. 231, 240, 759 P.2d 1054 (1988).[2] The trial court erred in not suppressing all of the evidence.
Reversed and remanded for a new trial.
RIGGS, J., dissents.
RIGGS, Judge, dissenting.
The majority, citing State v. Bridewell, 306 Or. 231, 759 P.2d 1054 (1988), sets an expansive course for which Bridewell provides no chart. I do not believe that the language in Bridewell was intended to include the kind of community caretaking *802 involved in this case. I would change course.
In Bridewell, the officer's sole motive in entering the defendant's property after the expression of community concern about his well-being was to determine whether the defendant had been injured, incapacitated or, possibly, was the victim of foul play at his remote, rural home. The Supreme Court held that drugs found during the search incidental to that community caretaking effort must be suppressed.
In this case, the police officer saw an apparently empty car in a convenience store parking lot, facing toward the street with the engine running. On closer inspection, the officer observed defendant slumped over the steering wheel, apparently asleep or unconscious. She tapped on the window and, when defendant failed to respond, opened the door and shook him. Defendant awoke extremely disoriented and smelling strongly of alcohol. He was arrested for DUII and a warrantless search ensued, during which the officer discovered methamphetamine.
The officer's initial contact with defendant was a proper stop based on reasonable suspicion, and the officer's subsequent actions also constituted a kind of community caretaking function that Bridewell should not be read to cover. Although the officer testified that her initial reason for tapping on the window and investigating further was to "make sure [that defendant was] all right," the further investigation was clearly and legitimately broader. Unlike in Bridewell, where the sole issue that prompted the officer's contact was defendant's own well-being, the officer's investigation here also served a larger, legitimate public safety purpose. A car in a public parking lot with the motor running, facing toward the street and occupied by a figure slumped over the wheel presents a level of potential danger to the public and the driver that did and, I hope, always would prompt alert police officers to perform the kind of investigation done in this case. I believe that our communities expect that this kind of "caretaking" by the police is within the legitimate public protection functions of law enforcement officials and that contraband discovered during such endeavors should not be suppressed for the reasons cited by the majority. Bridewell does not and should not speak to this kind of "caretaking" and, therefore, should not control here. The trial court correctly denied defendant's motion to suppress.
I dissent.
NOTES
[1] The state argues that defendant consented to the search. However, the consent followed an improper arrest and was not voluntary in the light of all the circumstances. See State v. Williamson, 307 Or. 621, 772 P.2d 404 (1989).
[2] The record does not support the position of the state and of the dissent that, when Lish opened the door, she was acting in a criminal investigatory role and making a "stop, based on reasonable suspicion." 100 Or. App. at 258, 785 P.2d at 802. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1657643/ | 673 So.2d 1201 (1996)
Armando Lopez SOTOMAYOR
v.
Wanda LEWIS and Liberty Mutual Insurance Company.
No. 95-CA-2520.
Court of Appeal of Louisiana, Fourth Circuit.
April 24, 1996.
*1202 Kevin T. Phayer, Metairie, for Appellees.
Victor J. Gonzalez, Metairie, for Appellant.
Before LOBRANO, PLOTKIN and MURRAY, JJ.
LOBRANO, Judge.
Plaintiff appeals the trial court judgment which dismissed his tort claims as prescribed. The issue for our determination is whether the payment of property damages, coupled with other actions by the defendant, constituted an acknowledgement which interrupted the prescriptive toll. We reverse.
The facts are basically undisputed. Plaintiff was involved in an automobile accident with defendant on August 27, 1992.[1] Plaintiff did not file the instant suit until December 22, 1993. During the intervening time period, specifically on May 3, 1993, defendant paid the plaintiff's property damages and automobile rental expenses. By letter dated June 9, 1993, defendant requested that plaintiff undergo an independent medical examination (IME). By letter dated September 28, 1993, defendant informed plaintiff's attorney that an IME for plaintiff had been scheduled for October 13, 1993. In her deposition, Julie Carson, defendant's claims adjuster, stated that she received the physician's IME report on October 28, 1993. On that date, she reviewed her file on plaintiff's claim to determine what, if anything, the claim was worth. In doing so, she realized that she did not have a copy of the petition which she assumed had been filed in this case with service withheld. Carson telephoned plaintiff's attorney on that same date, October 28, 1993, to request a copy of the petition and was informed by him that he had not filed suit in this matter. Plaintiff's attorney sent Carson a letter dated November 1, 1993 in which he stated his position that prescription was interrupted on May 3, 1993 when defendant paid plaintiff's property damages and began to run anew on that date. Plaintiff then filed suit on December 22, 1993.
DISCUSSION:
Plaintiff's lawsuit was filed more than one year after the date of the accident and, on its face, has prescribed. La.C.C. art. 3492. Plaintiff, therefore, bore the burden of proving that prescription was either suspended, interrupted or renounced. Lima v. Schmidt, 595 So.2d 624, 628 (La.1992).
Plaintiff only argues interruption. He asserts that there was an acknowledgement by defendant sufficient to interrupt prescription. He supplements that argument with the assertion that defendant "lulled" him into inaction. Finally, plaintiff argues that the trial court's denial of defendant's prescription exception, the first time it was presented, constitutes res judicata which prevented a second hearing on prescription.
ACKNOWLEDGMENT:
Prescription which has not yet accrued may be interrupted by the debtor's acknowledgement. Lima, supra. "Prescription is interrupted when one acknowledges the right of the person against whom he had commenced to prescribe." La.C.C. art. 3464. Once prescription is interrupted, it begins to *1203 run anew. Interruption by acknowledgment may be oral, in writing, formal, informal, express or tacit. Lima, supra; Gulf Coast Bank and Trust Co. v. Eckert, 95-156 (La.App. 5th Cir. 5/30/95), 656 So.2d 1081, writ denied 95-1632 (La. 10/6/95), 661 So.2d 474. Based on the doctrinal writings of various commentators, our Supreme Court, in Lima, made the following generalization:
A tacit acknowledgment occurs when a debtor performs acts of reparation or indemnity, makes an unconditional offer or payment, or lulls the creditor into believing he will not contest liability. Conversely, mere settlement offers or conditional payments, humanitarian or charitable gestures, and recognition of disputed claims will not constitute acknowledgments. These generalizations are reflected in the host of cases addressing the issue of what constitutes a tacit acknowledgment. Our courts have added to the above generalizations other criteria that evidence an acknowledgment, including undisputed liability, repeated and open-ended reassurances of payment, and continuous and frequent contact with the creditor throughout the prescriptive period. Conversely, our courts have recognized that mere recognition of a disputed claim, conditional payments, and settlement or compromise offers or negotiations do not evidence an acknowledgment. Lima, 595 So.2d at 634.
It is clear from the pronouncements in Lima and the plethora of appellate decisions footnoted in that case that a plaintiff pleading interruption by acknowledgment must convince the trier of fact that the cumulative effect of the debtor's actions constitute a recognition of the creditor's rights against him. Basically that is a factual call. In making that determination in this case, not only are we guided by the discussion in Lima, but by the legislative pronouncements of La.R.S. 22:661. That statute provides:
No settlement made under a motor vehicle liability insurance policy of a claim against any insured thereunder arising from any accident or other event insured against for damage to or destruction of property owned by another person shall be construed as an admission of liability by the insured, or the insurer's recognition of such liability, with respect to any other claim arising from the same accident or event.
In Waller v. Stuckey, 613 So.2d 643 (La. App.2d Cir.), writ denied, 618 So.2d 409 (La. 1993), cited by defendant, the court, relying on the pronouncements in Lima and the above cited statute, held that the payment of property damages did not serve as an acknowledgment sufficient to interrupt prescription. Furthermore, the court concluded that letters from defendant's adjuster seeking medical authorizations did not evidence an acknowledgment.
Contrary to the Waller decision, however, is Landor v. Allstate Ins. Co., 571 So.2d 843 (La.App. 3rd Cir.1990), writ denied, 575 So.2d 375 (La.1991), relied on by plaintiff. There, the court held, without referring to La.R.S. 22:661, that full payment of property damages, in response to plaintiff's demand, constituted a partial payment of damages and served to interrupt prescription. In that case there were numerous letters between plaintiff's attorney and defendant's adjusters requesting up to date medicals in an attempt to make "a prompt and fair settlement with you and your client."
In the instant case, plaintiff urges that once defendant's adjuster received a statement from an independent eyewitness, it acknowledged liability for the claim by paying the property damage and rental car expenses. Further, plaintiff asserts that the subsequent scheduling of plaintiff's medical exam buttressed defendant's acceptance of liability. Plaintiff asserts that the only remaining issue was the extent of his injuries.
Defendant argues that compromise or settlement negotiations do not constitute an acknowledgment. Furthermore, defendant asserts that the payment of property damages is legislatively permitted without being an admission of liability. Plaintiff's counter argument to the application of La.R.S. 22:661 is that it only applies to situations where more than one party is involved in litigation. That is, plaintiff argues that payment to one person does not constitute an admission of liability to the other. In effect, plaintiff *1204 equates the word "claim", as used in the phrase "any other claim" to mean, "person".[2]
Plaintiff's interpretation of the statute, although imaginative, cannot be correct. If the legislature intended to mean "person" it would have said so. Furthermore, the statute specifically refers to the claim of property damages only. In the scheme of determining whether there was an acknowledgment sufficient to interrupt prescription, R.S. 22:661 simply negates any effect to be given by the debtor's payment of property damages. In other words, payment of property damages does not bear any weight on deciding whether prescription was interrupted.
The mere application of that statute, however, does not end the inquiry. The other factors cited by plaintiff must be considered.
Plaintiff argues that he was "lulled" by defendant into believing that defendant was accepting liability for plaintiff's injuries by defendant's request for an IME, as well as defendant's prior actions in paying rental expenses once the independent witness statement was obtained. According to plaintiff, the impression created by defendant was that the claim would be settled after the IME results were received and that a lawsuit would not be necessary.
In her deposition, Ms. Carson testified that once she received the statement of the independent witness, Alana Jones, she felt Liberty Mutual owed the claim. She acknowledged that the statement was the deciding factor in determining Liberty Mutual's responsibility. Shortly thereafter, not only were the property damages paid, but also the expenses plaintiff incurred for a rental car.
Sometime in July of 1993 Ms. Carson spoke with plaintiff's attorney regarding the fact that she had no medical information concerning plaintiff's injuries. At that time Carson scheduled an IME for plaintiff with Dr. Horn on October 13, 1993. Plaintiff's attorney agreed. When Carson received the IME two weeks later, she searched her files for a copy of plaintiff's petition, but found none. She assumed suit had been filed and service had been withheld as is common practice in this type of situation when settlement negotiations are ongoing. After contacting' plaintiff's attorney and learning that suit had not been filed, she spoke with her supervisor and they agreed to immediately cease settlement negotiations.
Plaintiff's attorney testified that he had not filed suit because he was waiting for the IME results. He candidly admitted that he didn't realize the IME was scheduled subsequent to the one year prescriptive date. He felt that the case was going to be settled after the IME results were received. He stated that the scheduling of the IME for October 1993 lulled him into thinking that prescription would not have run by that date and that he had time to wait for the IME results before filing suit. He adamantly stated, however, that there was no intentional activity by Liberty Mutual to cause this belief, only his own failure to recognize the prescriptive date.
Initially we observe that prescriptive statutes are strictly construed against the running of prescription and in favor of the obligation sought to be extinguished. Lima, 595 So.2d at 629. While the evidentiary equities in this case are seemingly equal, we conclude that an acknowledgement sufficient to interrupt prescription did occur when defendant paid plaintiff's rental car expenses after receiving the statement of Alana Jones. Candidly, Ms. Carson testified it was the deciding factor which led her to believe Liberty Mutual was responsible. While we agree that plaintiff's attorney was not intentionally lulled into a false sense of prescriptive security, the evidence reasonably supports the conclusion that the only disagreement between the parties was the extent of plaintiff's injuries. After the receipt of Alana Jones' statement there is no evidence that liability was ever denied or contested by Liberty Mutual. The entire tenor of the communications between Ms. *1205 Carson and plaintiff's attorney subsequent to that time leaves the distinct impression that liability was never an issue. This is completely different from defendant recognizing the existence of a disputed claim.
Although admittedly a close case, based on the legal concept that prescription should be strictly construed against the extinguishment of a claim, we conclude that prescription was interrupted by defendant's tacit acknowledgement of responsibility and thus plaintiff's suit was timely. We make this determination without giving any weight to the payment of property damages by Liberty Mutual and only after weighing the other evidence set forth above.
REVERSED AND REMANDED.
NOTES
[1] The defendants are Liberty Mutual Insurance Co. and its insured, Wanda Lewis. We simply refer to both as defendant.
[2] In support of this argument, plaintiff relies on the facts of Flowers v. United States Fidelity and Guaranty Co., 381 So.2d 378 (La.1979). In that case the court concluded that interruption of prescription has no effect beyond the rights of the person of which the debtor makes an acknowledgment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2339268/ | 419 A.2d 323 (1980)
HERALD ASSOCIATION, INC. and McClure Newspapers, Inc.
v.
Honorable George F. ELLISON and Rutland Superior Court.
No. 34-80.
Supreme Court of Vermont.
July 29, 1980.
*324 Gravel, Shea & Wright, Ltd., Robert B. Hemley, Burlington (On the Memorandum), for petitioners.
Miller, Norton & Cleary, Rutland, for respondent Morgan.
Before BARNEY, C. J., DALEY, BILLINGS and HILL, JJ., and VALENTE, Superior Judge, Specially Assigned.
BARNEY, Chief Justice.
This petition for extraordinary relief arises from the exclusion of the news media and the general public from a pretrial hearing in State v. Bernard R. Morgan, Jr., Docket No. S3-79Rcr. The case prompted considerable press attention, presumably because the defendant was accused of assaulting an assistant judge of the Rutland Superior Court. The defendant moved to suppress certain statements alleged to have been made in violation of his constitutional rights. He also moved for closure of the suppression hearing on the ground that, should the statements be ruled inadmissible, widespread public knowledge of their contents would jeopardize his right to a fair trial. The prosecutor did not join in the motion, but did not oppose it.
At the time of the motion, an intern reporter for the Herald Association, a petitioner here, was present and voiced opposition to the proposed closure. The court entered a closure order and heard, in camera, the first witness in the suppression hearing. It then recessed the hearing to a later date. Before the suppression hearing was resumed, the Herald Association and McClure Newspapers petitioned to vacate the closure order.
The court refused to vacate its order, ultimately held the rest of the suppression hearing in camera, and directed that the transcript of the hearing be sealed until after a jury for trial was empaneled.
So matters stood when the instant petition was filed in this Court. The records in the Morgan case, of which we take judicial notice, see Weiner v. Prudential Insurance Co. of America, 110 Vt. 22, 27, 1 A.2d 708, 710 (1938), reveal that, since that time, the suppression motion has been denied, the defendant has elected not to stand trial and has entered a plea and been sentenced. This has had the presumably unintended effect of precluding the very event which was to have triggered public access to the substance of the hearing in the form of release of the transcript on empanelment of a jury.
Although events have, on this occasion, outrun the full range of possible relief, the petitioners by seeking extraordinary relief *325 have employed a proper legal vehicle for review of the order in question. V.R. A.P. 21. See In re Rhodes, 131 Vt. 308, 310, 305 A.2d 591, 592 (1973); Miner v. District Court, 136 Vt. 426, 428-29, 392 A.2d 390, 392 (1978). While such collateral proceedings are appropriate, we do not countenance any implication that nonparties can without authority in law be allowed any legal status within a pending criminal prosecution.
This petition brings before us the complex and unsettled fair trial-free press issues so recently addressed by the United States Supreme Court in Gannett Co. v. DePasquale, 443 U.S. 368, 99 S.Ct. 2898, 61 L.Ed.2d 608 (1979), and in Richmond Newspapers, Inc. v. Virginia, ___ U.S. ___, 100 S.Ct. 2814, 65 L.Ed.2d 973 (1980). The Gannett majority reiterated that adverse publicity may endanger a defendant's right to a fair trial. Gannett Co. v. DePasquale, supra, 443 at 378-79, 99 S.Ct. at 2905. It indicated that the Sixth Amendment right to a public trial is personal to the accused, id. at 379-87, 99 S.Ct. at 2905-2909 and that, in any case, such a right would not confer a right of access to pretrial proceedings. Id. at 387-91, 99 S.Ct. at 2909-2911. Finally the majority expressly reserved the question whether the First and Fourteenth Amendments conferred on the public a right of access to criminal proceedings and held that even if such a right did exist, it did not prohibit the pretrial closure at issue because the trial court struck a proper balance between such a right and the defendant's right to a fair trial. Id. at 391-93, 99 S.Ct. at 2911-2913.
We begin our analysis of this case with the simple proposition that Gannett does not authoritatively sanction this closure order. As we noted above, it does not appear that the superior court intended that this order become a permanent bar. By its terms, the transcript was to be open after jury drawing was completed. Yet the criminal prosecution of Bernard Morgan has been completed and the transcript remains sealed. Intent aside, it appears that the effect of the order is now permanent in nature. We must measure its validity based on its actual, not its intended, impact.
The permanent nature of this order distinguishes it in a critical aspect from the relief approved in Gannett. There, in determining that the trial court properly balanced the defendant's rights against any First Amendment right of access in the public, Justice Stewart rested on the temporary nature of the closure order involved:
Furthermore, any denial of access in this case was not absolute but only temporary. Once the danger of prejudice had dissipated, a transcript of the suppression hearing was made available. The press and the public then had a full opportunity to scrutinize the suppression hearing. Unlike the case of an absolute ban on access, therefore, the press here had the opportunity to inform the public of the details of the pretrial hearing accurately and completely. Under these circumstances, any First and Fourteenth Amendment right of the petitioner to attend a criminal trial was not violated.
Id. at 393, 99 S.Ct. at 2912 (footnote omitted). In this respect this order, in its present form, presents a different and deeper challenge to the First Amendment interests at stake.
Because of the fragmentation of the Court and because of the reservation of the First Amendment issue, Gannett left the fair trial-free press controversy almost as unsettled as it found it. Richmond Newspapers, supra, provides some additional guidance. It held that there is a First Amendment right to attend criminal trials. Id. ___ U.S. at ___, 100 S.Ct. at 2829. While the decision does not expressly determine whether any such right of access applies to pretrial hearings, it would seem fair to infer that it does. On the other hand, mere recognition of a First Amendment right of access to judicial proceedings does not demand that this order be vacated. Even as to trials, the right to recognize is not an absolute one, id. at ___ n.18, 100 S.Ct. at 2830, n.18, but rather a right to be weighed against other interests. Id. at ___ & n.18, ___, 100 S.Ct. at 2830 & n.18, 2834 (Brennan, J., concurring) ("An assertion *326 of the prerogative to gather information must accordingly be assayed by considering the information sought and the opposing interests invaded."). Moreover, the interests supporting closure have greater force as to pretrial hearings than as to trials because of the need, among other concerns, to prevent the "dissemination of suppressible prejudicial evidence to the public before the jury pool has become, in a practical sense, finite and subject to sequestration." Id. at ___ n.25, 100 S.Ct. at 2839 n.25 (Brennan, J., concurring).
Our case then, while similar to both Gannett and Richmond Newspapers, lies between the two holdings. It seems that the First Amendment is implicated by this order, but the decisions of the final constitutional arbiter, the United States Supreme Court, do not clearly determine whether this closure violates the First Amendment.
In the face of such uncertainty, the wisdom of our traditional rule of self-restraint-that we do not needlessly decide constitutional issues, e. g., In re Wildlife Wonderland, Inc., 133 Vt. 507, 519-20, 346 A.2d 645, 653 (1975); State v. LaPlaca, 126 Vt. 171, 176, 224 A.2d 911, 915 (1966); Hanley v. United Steel Workers of America, 119 Vt. 187, 193, 122 A.2d 872, 876 (1956),-is all the more apparent. We would not wish to inadvertently infringe upon any right of access nor deny any defendant the full measure of his right to a fair trial. Of course, given a case in which a determination of the issues presented demands that this Court decide such questions, it would be our duty to do so. But this is not such a case.
Leaving aside for the moment constitutional concerns, we note that in this state public judicial proceedings are the rule and closed ones the exception. See Sunday v. Stratton Corp., 136 Vt. 293, 305-06, 390 A.2d 398, 405 (1978). Where closed proceedings have occurred they have ordinarily had specific statutory authorization. E. g., 12 V.S.A. § 1901 (obscene or scandalous causes); 33 V.S.A. § 651(c) (juvenile proceedings); 13 V.S.A. § 5131 (criminal inquests).
Because the undetermined scope of constitutional rights is implicated and because our own state policy of open judicial proceedings is thereby contravened, any pretrial closure order imposed in this jurisdiction must be based on a clear necessity for the protection of the defendant's fair trial rights and must be limited in scope by its justification. A trial court facing a closure motion must therefore consider and make use of the numerous procedural devices with which a defendant's right to a fair trial can be protected without ordering a closure. They include "continuance, severance, change of venue, change of venire, voir dire, peremptory challenges, sequestration, and admonition of the jury." Gannett, supra, 443 U.S. at 441, 99 S.Ct. at 2937 (Blackmun, J., concurring in part and dissenting in part) (citing ABA Project on Standards for Criminal Justice, Fair Trial and Free Press, Standard 8-3.2, at 16 (App. Draft 1978); Nebraska Press Assn. v. Stuart, 427 U.S. 539, 562-65, 96 S.Ct. 2791, 2804, 49 L.Ed.2d 683 (1976); and Sheppard v. Maxwell, 384 U.S. 333, 354 n.9, 358-62, 86 S.Ct. 1507, 1518 n.9, 1520, 16 L.Ed.2d 600 (1966)).
We note that not all of these devices are well suited to every case. Change of venue, for example, is frequently referred to as a ready expedient for avoiding prejudicial publicity problems. However, it is a remedy which should not lightly be resorted to. Quite apart from the added expense to the state and the taxpayers, and the burden and inconvenience to trial participants which it causes, a venue change erodes, at least in spirit, the defendant's right to trial "by an impartial jury of the country." Vt. Const. ch. I, art. 10. That provision is some recognition of a common law right to be tried locally, and has legislative implementation in our venue statutes. See, e. g., State v. Murphy, 134 Vt. 106, 108-09, 353 A.2d 346, 348-49 (1976); States v. Brown, 103 Vt. 312, 154 A. 579 (1931); 13 V.S.A. §§ 4601-4638.
Measuring the closure order challenged here against the two considerations outlined above, it is clear that the order *327 cannot stand. Even assuming that some sort of closure order was justified in the circumstances, a question which we do not decide, the order imposed must be vacated because it extends beyond the justification for its imposition. Certainly, now that Bernard Morgan has pleaded guilty and been sentenced, he no longer has a fair trial interest worthy of protection by closure of the record of his pretrial suppression hearing. Yet, as we have noted above, the transcript of that hearing is still sealed. At least in this respect, the order is improper.
The January 17, 1980, order of the Rutland Superior Court sealing the transcript of the suppression hearing in State v. Bernard R. Morgan, Jr., Docket No. S3-79Rcr is vacated. The transcript is declared a public record.
BILLINGS, Justice, concurring.
I agree with the result reached by the majority in this case, but I do so on different grounds than those of the majority opinion. My reading of Gannett Co. v. DePasquale, 443 U.S. 368, 99 S.Ct. 2898, 61 L.Ed.2d 608 (1979), which held that the Sixth Amendment to the United States Constitution does not guarantee public access to certain pretrial hearings where the defendant, prosecution and court concur in closure, and the cases of Nebraska Press Assn. v. Stuart, 427 U.S. 539, 96 S.Ct. 2791, 49 L.Ed.2d 683 (1976); New York Times Co. v. United States, 403 U.S. 713, 91 S.Ct. 2140, 29 L.Ed.2d 822 (1971) (per curiam); New York Times Co. v. Sullivan, 376 U.S. 254, 84 S.Ct. 710, 11 L.Ed.2d 686 (1964); In re Oliver, 333 U.S. 257, 68 S.Ct. 499, 92 L.Ed. 682 (1948); and Near v. Minnesota, 283 U.S. 697, 51 S.Ct. 625, 75 L.Ed. 1357 (1931), has been that the Supreme Court would be inclined to hold in the proper case that the First Amendment to the United States Constitution guarantees such access. I find support for this inclination in Gannett Co. v. DePasquale, supra, 443 U.S. at 380, 383, 385, 391-94, 397-403, 99 S.Ct. at 2906, 2907, 2908, 2911-2913, 2914-2917 (Powell, J., concurring); 411, 413 n.2, 418-48, 99 S.Ct. 2922, 2923 n.2, 2925-2940 (Blackmun, J., concurring and dissenting), although the issue was not decided there, id. at 411, 99 S.Ct. at 2922. My view has been confirmed in part by the recent case of Richmond Newspapers, Inc. v. Virginia, ___ U.S. ___, 100 S.Ct. 2814, 65 L.Ed.2d 973 (1980).
In Richmond Newspapers, the Court held that the First Amendment to the United States Constitution guarantees, although not absolutely, public access to criminal trials. Id. at ___, 100 S.Ct. at 2830. While the plurality opinion of the Chief Justice in Richmond Newspapers appears to invoke "a veritable potpourri" of constitutional sources for the holding, including the free speech, free press, and assembly clauses of the First Amendment and the Ninth Amendment, id. at ___, 100 S.Ct. at 2842 (Blackmun, J., concurring), I find the succinct invocation by Justice Brennan of the free speech clause and its historical background and role in a republican system of self-government fully adequate for the disposition of this case. It is clear to me that the structural role of the clause is the safeguarding of vigorous public debate on issues of public importance, see New York Times Co. v. Sullivan, supra, 376 U.S. at 270, 84 S.Ct. at 721, and that such a safeguard carries with it the requirement that the public be permitted access to information on matters of public concern. Richmond Newspapers, Inc. v. Virginia, supra, ___ U.S. at ___, 100 S.Ct. at 2832 (Brennan, J., concurring). Certainly, the application at a pretrial hearing of the Constitution to evidence admissible in a criminal trial is a subject of public concern, for it concerns the relationship of the state and individual, and the nature of the judicial process-issues of preeminent significance in the debate which ensures the vitality of our society and government.
While it may be suggested that Richmond Newspapers does not extend its rule to pretrial hearings, to which Gannett held the public is not guaranteed access under the Sixth Amendment, I find this most unlikely. Although the Chief Justice has attempted to distinguish Richmond Newspapers from Gannett on the ground that the latter applied only to pretrial hearings, Richmond *328 Newspapers, Inc. v. Virginia, supra, ___ U.S. at ___, 100 S.Ct. at 2821, such a distinction is facile, see id. at ___, 100 S.Ct. at 2840 (Blackmun, J., concurring). After Richmond Newspapers, the "ultimate ruling in Gannett . . . is now to the effect that there is no Sixth Amendment right on the part of the public-or the press-to an open hearing on a motion to suppress." Id. at ___, 100 S.Ct. at 2842 (Blackmun, J., concurring).
It is inconsistent with Richmond Newspapers and not required by Gannett to conclude in the instant case that there is or may not be a First Amendment right of public access to pretrial motion hearings. The court below having found no facts giving rise to any basis for qualifying the public's right of access, the court's order closing the hearing and record was clear error.
HILL, Justice, concurring in part and dissenting in part.
I concur in the majority's opinion insofar as it grants access to the transcript of the suppression hearing, but dissent from it in every other respect.
I.
Initially, I take issue with the majority's cursory review of the facts, for I do not believe that it accurately reflects what transpired in the present case. I attempt to supply the critical yet missing facts.
First, on October 30, 1979, when the information charging Bernard R. Morgan was filed in the Rutland Superior Court, it was accompanied by an affidavit of a deputy state's attorney. The affidavit contained an account of the events that transpired on the day of the alleged crimes, two eyewitness identifications of the accused, several statements made by potential trial witnesses that tended to inculpate him, and the recitation of incriminating statements that the witnesses attributed to him. Both the information and the affidavit became part of the public record on file at the Rutland Superior Court and continued to be open to the public until January 4, 1980, when the affidavit was sealed as a result of the superior court's closure order. It was this affidavit that contained many of the statements which Morgan sought to suppress and that provided the information for the newsstories which purportedly resulted in defendant's closure motion.
Second, the press attention that Morgan claimed would prevent him from receiving a fair trial, and that the majority characterizes as "considerable," consisted, so far as the record shows, of seven newsstories over the course of two months. Furthermore, the newsstories consisted almost entirely of straightforward reporting of the facts surrounding Morgan's arrest and the condition of the victim. There was not even a tinge of sensationalism in any of the articles. See Rutland Daily Herald, October 29, 1979, at 15, col. 6; id., October 30, 1979, at 9, col. 3; id., October 31, 1979, at 13, col. 5; id., November 1, 1979, at 17, col. 1; id., November 15, 1979, at 26, col. 2; id., January 4, 1980, at 11, col. 1; id., January 5, 1980, at 1, col. 1.
This was the state of the case when the trial court granted defendant's unopposed motion to close. Petitioners then commenced the present proceeding, challenging the order of the superior court as being in violation of the first and sixth amendments to the United States Constitution, as applicable to the states through the fourteenth amendment.
II.
The issue with which we are presented today, while new to this Court, was recently addressed by the United States Supreme Court in Gannett Co. v. DePasquale, 443 U.S. 368, 99 S.Ct. 2898, 61 L.Ed.2d 608 (1979). In that case, the Supreme Court held, by a 5-4 majority, that the sixth amendment to the United States Constitution does not bar the closing of a pretrial suppression hearing to the public and the press where both the judge and the prosecutor acquiesce, and a public proceeding would jeopardize a defendant's right to a fair trial. Writing for a majority of the *329 Court, Justice Stewart stated that the sixth amendment guarantee of a public trial "is personal to the accused," and does not embrace "any right of access to a criminal trial on the part of the public." Id. at 379-80, 99 S.Ct. at 2905.
Whether the press and the public have a first amendment right of access to information, however, was expressly reserved by seven members of the Court. Id. at 392, 99 S.Ct. at 2912; id. at 447, 99 S.Ct. at 2939. Only two justices squarely addressed the issue, and they came to opposite conclusions. Id. at 397, 99 S.Ct. at 2914 (Powell, J., concurring, finding first amendment right); id. at 404-06, 99 S.Ct. at 2917-2919 (Rehnquist, J., concurring, finding no first amendment right).
In the case at bar, although the first amendment issue was squarely raised, the majority goes to great pains to skirt it. I am unwilling, however, to avoid deciding issues squarely raised and necessary to the determination of a particular case in the guise of "not needlessly decid[ing] constitutional issues," when I believe that the traditional rule is being misused merely to avoid resolving a controversial issue.
It is my opinion that the first amendment does confer a right of public access, though not absolute, to judicial proceedings. A core objective of the first amendment is to ensure that there is a full and free flow of information to the general public, so that an informed citizenry can responsibly exercise those rights essential to the success of our system of government. See New York Times Co. v. Sullivan, 376 U.S. 254, 269-79, 84 S.Ct. 710, 720-725, 11 L.Ed.2d 686 (1964). Foremost among those fundamental rights is the right freely to discuss and scrutinize the affairs of government, especially the manner in which our criminal justice system is conducted.
What is at stake here is the societal function of the First Amendment in preserving free public discussion of governmental affairs. No aspect of that constitutional guarantee is more rightly treasured than its protection of the ability of our people through free and open debate to consider and resolve their own destiny.. . . It embodies our Nation's commitment to popular self-determination and our abiding faith that the surest course for developing sound [governmental] policy lies in a free exchange of views on public issues. And public debate must not only be unfettered; it must also be informed.
Saxbe v. Washington Post Co., 417 U.S. 843, 862-63, 94 S.Ct. 2811, 2821, 41 L.Ed.2d 514 (1974) (Powell, J., dissenting). See New York Times Co. v. Sullivan, supra. See also Maryland v. Baltimore Radio Show, Inc., 338 U.S. 912, 920, 70 S.Ct. 252, 256, 94 L.Ed. 562 (1950) (opinion of Frankfurter, J., respecting denial of certiorari) ("One of the demands of a democratic society is that the public should know what goes on in courts by being told by the press what happens there, to the end that the public may judge whether our system of criminal justice is fair and right.").
Only recently this Court had the occasion in a civil case to comment on our judicial system's antipathy toward secret judicial proceedings. In Sunday v. Stratton Corp., 136 Vt. 293, 390 A.2d 398 (1978), the Court was confronted with a claim that the trial court erred by denying a request to hold the hearing on a motion for a directed verdict outside the presence of the public and the press. Writing for the Court, Mr. Justice Larrow pointed out that closed proceedings are "the exception rather than the rule," id. at 306, 390 A.2d at 405, and he explicitly adopted the following language from Mr. Justice Brennan's concurring opinion in Nebraska Press Association v. Stuart, 427 U.S. 539, 587, 96 S.Ct. 2791, 2816, 49 L.Ed.2d 683 (1976):
Secrecy of judicial action can only breed ignorance and distrust of courts and suspicion concerning the competence and impartiality of judges; free and robust reporting, criticism, and debate can contribute to public understanding of the rule of law and to comprehension of the functioning of the entire criminal justice system, as well as improve the quality of that system by subjecting it to the cleansing *330 effects of exposure and public accountability.
Sunday v. Stratton Corp., supra.[1] See also Gannett Co. v. DePasquale, supra, 443 S.Ct. at 428-29, 99 S.Ct. at 2930-2931, 61 L.Ed.2d 608 (Blackmun, J., concurring and dissenting); United States v. Cianfrani, 573 F.2d 835, 851 (3d Cir. 1978).
Among the many beneficial effects that are brought to bear by the right to know what transpires at judicial proceedings are "[t]he protection against perjury which publicity provides, and the opportunity publicity offers to unknown witnesses to make themselves known" to the court. Gannett Co. v. DePasquale, supra, 443 U.S. at 427, 99 S.Ct. at 2930, 61 L.Ed.2d 608 (Blackmun, J., concurring and dissenting). Furthermore, open proceedings serve "to protect [the] accused from the abuses to which secret tribunals would be prone," as well as to ensure that no defendant benefits "from the partiality of a corrupt, biased, or incompetent judge." Id. at 428, 99 S.Ct. at 2930. In short, public proceedings guarantee that the probity of the judicial process is maintained, and that the officials entrusted with the public's confidence carry out their duties in a conscientious and trustworthy manner.
Because the average citizen has neither the time nor the inclination to attend any or all of the multitude of judicial proceedings that take place within our state each day, it necessarily devolves on the press to provide the information that the public requires to discharge intelligently their political responsibilities. This is not to say, of course, that the press enjoys any right of access greater than the public at large, but rather that in ferreting out the news the press acts as agents for the populace. Id. at 397-98, 99 S.Ct. at 2914 (Powell, J., concurring); Cox Broadcasting Corp. v. Cohn, 420 U.S. 469, 495, 95 S.Ct. 1029, 1046, 43 L.Ed.2d 328 (1975).
As I stated above, the right of access guaranteed to both the public and the press is not absolute. There are a number of instances where courts confronted with delineating the bounds of such a right of access have held that sufficiently compelling reasons may exist for closing a proceeding. See, e.g., Gannett Co. v. DePasquale, supra, 443 U.S. at 397 n.1, 99 S.Ct. at 2914 n.1 (Powell, J., concurring) (grand jury proceedings); Illinois v. Allen, 397 U.S. 337, 343, 90 S.Ct. 1057, 1060, 25 L.Ed.2d 353 (1970) (necessary to preserve decorum); United States v. Bell, 464 F.2d 667 (2d Cir.), cert. denied, 409 U.S. 991, 93 S.Ct. 335, 34 L.Ed.2d 258 (1972) ("skyjacker profile"); Geise v. United States, 262 F.2d 151 (9th Cir. 1958) (testimony of young complainant in rape prosecution); Westchester Rockland Newspapers, Inc. v. Leggett, 48 N.Y.2d 430, 453 n.3, 399 N.E.2d 518, 532 n.3, 423 N.Y. S.2d 630, 644 n.3 (1979) (Fuchsberg, J., concurring) (deliberations of judge and jury); Philadelphia Newspapers, Inc. v. Jerome, 478 Pa. 484, 509, 387 A.2d 425, 437 (1978) (sidebar and bench conferences); Williams v. Stafford, 589 P.2d 322, 330 (Wyo. 1979) (Raper, C. J., dissenting) (juvenile cases). See generally Note, Trial Secrecy and the First Amendment Right of Public Access to Judicial Proceedings, 91 Harv.L.Rev. 1899 (1978). The full range of such possible exceptions need not be delineated here, however, for the issue presented today involves only the situation where the public's and the press' right of access is sought to be curtailed based on the concern that open proceedings would result in prejudicial publicity, thereby impinging on a defendant's right to a fair trial.
I believe that in the great majority of cases it would be possible for the trial court to accommodate the public's constitutional right of access with a criminal defendant's constitutional right to a fair trial. The court's determination would of necessity require the judge to measure the potential prejudicial effect that the claimed publicity, both that already released and that yet to come, will have on the ultimate trial. To *331 aid a judge having to make this accommodation, I would provide the following guidelines, which generally follow the standards proposed by the American Bar Association, ABA Standards Relating to the Administration of Criminal Justice: Fair Trial and Free Press Standard 8-3.2 (App. Draft 1978), and adopted by the great majority of courts that have considered the issue. See, e.g., Northwest Publications, Inc. v. Anderson, 259 N.W.2d 254 (Minn. 1977); Keene Publishing Corp. v. Cheshire County Superior Court, 119 N.H. ___, 406 A.2d 137 (1979); Detroit Free Press, Inc. v. Macomb Circuit Judge, 405 Mich. 544, 275 N.W.2d 482 (1979); State v. Allen, 73 N.J. 132, 373 A.2d 377 (1977); Westchester Rockland Newspapers, Inc. v. Leggett, supra, 48 N.Y.2d 430, 399 N.E.2d 518, 423 N.Y.S.2d 630 (1979); State ex rel. Dayton Newspapers, Inc. v. Phillips, 46 Ohio St.2d 457, 351 N.E.2d 127 (1976); Rapid City Journal Co. v. Circuit Court, 283 N.W.2d 563 (S.D. 1979); Williams v. Stafford, supra, 589 P.2d 322 (Wyo. 1979).
First, an accused who seeks closure must provide an adequate basis to support a finding that there is a substantial likelihood that his fair trial right will be irreparably damaged by holding a public proceeding. The accused must show, and the court must consider, the nature and extent of the publicity prior to the closure motion in order to reasonably project whether further coverage will result in the harm sought to be avoided. See Gannett Co. v. DePasquale, supra, 443 U.S. at 441, 99 S.Ct. at 2937 (Blackmun, J., concurring and dissenting).
Second, the accused must show a substantial likelihood that less restrictive alternatives to closure will not adequately protect the fairness of his trial. In adjudging whether an accused has made a sufficient showing on this point to warrant the extraordinary device of closure, a trial judge should at the very least consider the following alternatives: continuance, severance, change of venue, change of venire, voir dire, peremptory challenges, sequestration, and admonition of the jury. ABA Standards, supra, Standard 8-3.2, at 16 (App. Draft 1978); see Nebraska Press Association v. Stuart, supra, 427 U.S. at 562-65, 96 S.Ct. at 2804. A conclusion that closure is necessary because no less restrictive alternatives would be adequate must be supported by explicit findings made on the record. Furthermore, in the case of suppression hearings of the nature involved here, which most often address the circumstances surrounding the obtainment of a confession rather than its substance, a carefully conducted hearing could be had in public with a minimum risk that prejudicial information would be disclosed. See Gannett Co. v. DePasquale, supra, 443 U.S. at 442, 99 S.Ct. at 2937 (Blackmun, J., concurring and dissenting).
Third, the accused must establish that there is a substantial likelihood that closure will be effective in guarding against the perceived harm. Where, as here, substantial prejudicial information has already been made public, it is doubtful that closure would be efficacious, for at the most closure serves only to preclude access to information, not to eradicate information already within the knowledge of the public. Id. 99 S.Ct. at 2937.
Lastly, before any person is asked to leave the courtroom, he must be given the opportunity to briefly and informally state his objections on the record. This is not to say, of course, that the public must be given prior notice of the motion or the hearing. Id. at 445-46, 99 S.Ct. at 2939. Similarly, if a person is subsequently denied access to a sealed record, he must be given the opportunity to raise his objections.
The balancing of potentially conflicting constitutional rights requires the utmost care, for no person should be forced to relinquish his or her cherished rights. The guidelines that I propose would serve to accommodate both the rights of the criminal defendant and the rights of the press and public in the overwhelming majority of cases. If, however, the extraordinary case which requires restrictions on access should arise, those restrictions should extend no further than the circumstances reasonably require. Id. at 444-45, 99 S.Ct. at 2938-2939. *332 It must be remembered that the general rule is that judicial proceedings should be held in open court. See Sunday v. Stratton Corp., supra, 136 Vt. at 306, 390 A.2d at 405. Any departure from this rule must be based on an adequate showing by the defendant and a considered decision by the court. With this in mind, I now turn to the order in the present case.
III.
I have carefully reviewed the record in this case, and I find it barren of any facts that would support the court's closure order. No factual inquiry was made into the nature or extent of the publicity that had been given the case up until the time the closure order was first imposed. At the hearing on the motion to vacate the court's closure order, the main thrust of the arguments related to the relevant legal theories, not to the potential impact of the publicity on the community. Furthermore, in considering whether less restrictive alternatives to closure would have sufficed, the lower court merely recited the options we suggested above, and dismissed them seriatim in conclusory terms, without ever making any findings of fact as to why those alternatives would not have served to protect against the perceived harm. It is also highly questionable whether the closure order actually achieved its intended purpose, since most, if not all, of the prejudicial information to which the accused sought to restrict access was already in the hands of the public.
Even though the Court now appears to hold that the closure order in the present case was not properly imposed, it is not in a position to undo the damage that was done to the rights of the public and the press, since the closed proceeding has already been held. The irremediable nature of a closure order and the inadequacy of a transcript as a substitute for attendance at a hearing are two compelling reasons why I would stress forcefully the necessity for the trial court to marshal all the facts before attempting to make a judgment on an unopposed motion to close a judicial proceeding. The majority opinion, on the other hand, sees no difference between attendance at a hearing and having access to a transcript of that hearing at some later date. As a result, it fails to address the issue of whether the public and the press have a right of access to the hearing itself. It merely concludes that as between a right of access the public and press may or may not have, a question they do not decide, and a right to a fair trial that the defendant here no longer has because he has pled guilty, the former outweighs the latter. This resolves nothing.
In the later stages of our consideration of the present case the United States Supreme Court decided Richmond Newspapers, Inc. v. Virginia, ___ U.S. ___, 100 S.Ct. 2814, 65 L.Ed.2d 973 (1980). Contrary to the majority, who evidently have read that case with an eye more towards what it did not say than towards what it did say, I believe that case supports the conclusion that there is a first amendment right of access to judicial proceedings in general. The reasons advanced by the various members of the Court in holding that there is a first amendment right of access to trials are equally compelling in determining whether there is a first amendment right of access to pretrial and other judicial proceedings. Furthermore, the first amendment analysis relied on in Richmond Newspapers does not lend itself to the simple distinctions that the sixth amendment analysis relied on in Gannett, supra, does. Literally, the sixth amendment gives the accused a right to a "public trial." It does not, as some members of the Court observed in Gannett, make any mention of pretrial proceedings. The first amendment, on the other hand, contains no language upon which this distinction between trials and pretrial proceedings could be made. At the most, the type of proceeding to which access is sought is one factor to be taken into account in determining whether a defendant has shown such an overriding interest that the presumption of openness which attaches to judicial proceedings has been rebutted.
NOTES
[1] The majority opinion cites Sunday as embodying a mere policy in favor of open judicial proceedings. I find it impossible, however, to so facilely pass off the constitutional underpinnings of that case, especially in light of the fact that Mr. Justice Brennan's opinion in Nebraska Press Association v. Stuart, supra, was grounded on none other than the first amendment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1846912/ | 320 So.2d 668 (1975)
GENERAL CORPORATION, a corporation,
v.
STATE of Alabama ex rel. Eugene SWEETON, Chief of Police, City of Huntsville, Alabama.
SC 521.
Supreme Court of Alabama.
September 18, 1975.
*671 Frierson M. Graves, Jr., Memphis, Tenn., for appellant.
Watts, Salmon, Roberts, Manning & Noojin, Huntsville, for appellee.
ALMON, Justice.[*]
The question presented by this appeal is whether the Alabama Red Light Abatement Act, Tit. 7, § 1091 et seq., Code of Alabama 1940, Recompiled 1958, can be constitutionally applied to the exhibition of obscene motion pictures. More specifically, whether the showing of obscene motion pictures constitutes a public nuisance, the sanction for which is the padlocking of the premises for up to one year.
The complaint filed January 16, 1973, alleged that for a period in excess of nineteen months, appellant had consistently shown obscene films at the Fox Cinema Theatre and that the showing of certain of these films constituted a violation of both the nuisance and obscenity laws of the State of Alabama. The complaint prayed for issuance of a preliminary injunction after notice and hearing, and that after a final hearing on the issue of obscenity, appellant, General Corporation, be perpetually enjoined from maintaining said nuisance.
The pretrial order, issued on February 13, 1973, set out the contentions of the respective parties including a stipulation that the Fox Cinema Theatre was an enclosed adult movie house. A supplemental pretrial order was issued on February 22, 1973, stipulating that the issues in controversy were, whether the conduct of appellant constituted "lewdness" under Tit. 7, § 1091, Code, supra.
On February 23, 1973, the final decree of the trial court was entered. Specifically, the trial judge found that appellant had engaged in showing obscene movies at the Fox Cinema Theatre and that such activity constituted a public nuisance. Pursuant to that finding, the court decreed that appellant be perpetually enjoined from maintaining said nuisance at the Fox Cinema Theatre or elsewhere in the county; that all personal property contained in the theatre be removed and sold in the manner provided for the sale of chattels under execution; that the theatre be closed for all purposes for one year unless sooner released under the provisions of Tit. 7, § 1104, Code, supra; and that the proceeds of the sale be applied to the costs. A writ of injunction was issued embodying the terms of the final decree.
On March 23, 1973, the court amended its final decree specifically limiting its operation to obscene matter, but leaving undisturbed the provision closing the theatre for one year.
The evidence showed that appellant was engaged in the operation for profit of the Fox Cinema Theatre, situated in Huntsville, Alabama. During the period of December 20, 1972, through January 10, 1973, inclusive, Mr. Ron Curlee, a detective employed by the Huntsville Police Department, *672 visited the Fox Cinema Theatre on several occasions. During these visits Mr. Curlee took numerous sequential photographs and recorded contemporaneous audio tapes of the films which were being exhibited at the theatre. These motion picture films were entitled: "The Making of the Blue Movie," "I am Sandra," "Mary Jane," "The Gun Runners," "The Executive Wives," and "The Mermaids." At trial Mr. Curlee, referring to the notes and pictures he had taken while at the theatre, testified as to the subject matter content of each of the foregoing films. That testimony tended to show that said films depicted, inter alia, sexual intercourse, fellatio, cunnilingus, group sex, lesbianism, auto-eroticism, fettishism, voyeurism, and sado masochistic sexual activities.
The State's contention below was that the movies exhibited at the Fox constituted a public nuisance in that they were "obscene," and that under the provisions of Tit. 7, § 1091, et seq. (the Alabama Red Light Abatement Act) the operation of the theatre was subject to abatement. Appellant's position was that this Act was not intended to apply to motion picture films or, in the alternative, if the legislature did so intend, such application is unconstitutional.
Any doubts that patently obscene expression falls outside the protection of the First Amendment and therefore enjoys no immunity from state regulations have long been laid to rest. Miller v. California, 413 U.S. 15, 93 S.Ct. 2607, 37 L.Ed.2d 419 (1973); United States v. Reidel, 402 U.S. 351, 91 S.Ct. 1410, 28 L.Ed.2d 813 (1971); Roth v. United States, 354 U.S. 476, 77 S.Ct. 1304, 1 L.Ed.2d 1498 (1957). "The primary requirements of decency may be enforced against obscene publications." Near v. State of Minnesota, 283 U.S. 697, 51 S.Ct. 625, 75 L.Ed. 1357 (1931). More recently the United States Supreme Court has reaffirmed the principle that the states have a legitimate interest in regulating the use of obscene material; and, more specifically, that local regulations dealing with such material will not be disturbed or struck down so long as they comport with specific constitutional mandates. Paris Adult Theatre v. Slaton, 413 U.S. 49, 93 S.Ct. 2628, 37 L.Ed.2d 446 (1973).
However, due to the elevated status ascribed to First Amendment guarantees, procedures adopted by states for dealing with obscene expression have been the subject of close judicial scrutiny. Marcus v. Property Search Warrant, 367 U.S. 717, 81 S.Ct. 1708, 6 L.Ed.2d 1127 (1961). The line between expression unconditionally guaranteed and that which may be legitimately regulated is finely drawn. Speiser v. Randall, 357 U.S. 513, 78 S.Ct. 1332, 2 L.Ed.2d 1460 (1958).
Although motion pictures are a form of expression and within the shield of the First Amendment, United States v. A Motion Picture Film, 404 F.2d 196 (2d Cir. 1968), they are not necessarily subject to the same rules governing other modes of expression. Burstyn v. Wilson, 343 U.S. 495, 72 S.Ct. 777, 96 L.Ed. 1098 (1951). Because of the singularly unique nature of the medium, a motion picture may be denominated obscene and thereby exceed the protective bounds of the First Amendment long before a written description of the same subject matter. Landau v. Fording, 245 Cal.App.2d 820, 54 Cal.Rptr. 177, aff'd 388 U.S. 456, 87 S.Ct. 2109, 18 L.Ed.2d 1317 (1966); People v. Bloss, 18 Mich. App. 410, 171 N.W.2d 455 (1969). Moreover, the United States Supreme Court has expressly rejected constitutional immunity from state regulation for obscene films simply because their exhibition is limited to consenting adults. Paris Adult Theatre v. Slaton, supra.
So, although the regulation of obscene expression is unquestionably a legitimate matter for state control, it does not necessarily follow that the doctrine of public nuisance can be constitutionally applied to obscenity. Traditionally, continuing *673 activity contrary to public morals or decency have constituted public nuisances. Price v. State, 96 Ala. 1, 11 So. 128 (1891); Ridge v. State, 206 Ala. 349, 89 So. 742 (1921); Hayden v. Tucker, 37 Mo. 214 (1866); Federal Amusement Co. v. State, ex rel. Tuppen, 159 Fla. 495, 32 So. 2d 1 (1947); Abbott v. State, 163 Tenn. 384, 43 S.W.2d 211 (1931); Perkins on Criminal Law, p. 395 (Foundation Press, 1969); Wood, Law of Nuisances, § 68, p. 87, vol. 1 (3d ed., 1893); 66 C.J.S. Nuisance § 18 d, p. 766. Under the police power, a court of equity with proper legislative authorization can assume jurisdiction to abate a nuisance notwithstanding the fact that the maintenance of that nuisance may also be a violation of the criminal law. Ridge v. State, supra; Evans Theatre Corporation v. Slaton, 227 Ga. 377, 180 S.E.2d 712 (1971), cert. denied 404 U.S. 950, 92 S.Ct. 281, 30 L.Ed.2d 267 (1971).
However, where First Amendment rights are involved, there was been no such unanimity of authority for a multitude of reasons, the more salient of which warrant separate consideration.
At the outset we note three requirements imposed by the First Amendment upon any statute which attempts to regulate obscene material: (1) the burden of proving obscenity must always rest with the State; (2) administrative action determining matter to be obscene must not have an air of finalitythere must be provision for prompt, judicial review; (3) where prior restraint exists, there must be an immediate final determination on the issue of obscenity. Blount v. Rizzi, 400 U.S. 410, 91 S.Ct. 423, 27 L.Ed.2d 498 (1971); United Artists Corporation v. Wright, 368 F. Supp. 1034 (N.D.Ala.1974); Gulf States Theatres of Louisiana v. Richardson, 287 So.2d 480 (La.Sup.Ct.1974); New Rivieria Arts Theatre v. State, 412 S.W.2d 890 (Tenn.Sup.Ct.1967).
In terms of burden of proof, traditional public nuisance doctrine vis-a-vis obscenity poses a twofold dilemma; (1) what is the burden of proof, and (2) upon whom does the burden fall. Regarding the former, there is a dichotomy in the social ills against which obscenity law and public nuisance law are directed. The definitional test for obscenity attempts to separate those materials protected by the guaranties of freedom of expression; the aim of a nuisance action, on the other hand, is not the suppression of a particular form of expression, rather the abatement of a condition which works harm upon a substantial number of the public or which injuriously affects public safety, health, or morals. City of Selma v. Jones, 202 Ala. 82, 79 So. 476 (1918).
In Grove Press, Inc. v. City of Philadelphia, 418 F.2d 82 (3d Cir. 1969) it was held that nuisance doctrine was too elastic and amorphous to constitutionally restrict First Amendment rights. The court concluded that public nuisance doctrine could not be used both to define the standards of protected speech and to serve as a vehicle for its restraint. Accord, State ex rel. Murphy v. Morley, 63 N.M. 267, 317 P.2d 317 (1957); Commonwealth v. Guild Theatre, Inc., 432 Pa. 378, 248 A.2d 45 (1968).
Tit. 7, § 1091, Code, supra, defines as a nuisance any place where ". . . lewdness, assignation, or prostitution is conducted, permitted, continued, or exists;. . ." (Emphasis ours). By contrast, this language is discernibly "amorphous" when compared with Tit. 14, § 374(16j) (1971 Supp.) which defines obscenity and related terms with specificity and incorporates the three-prong test for "hard-core pornography" of Roth v. United States, supra. The final decree of the trial court, however, demonstrates that in finding the films "obscene", the trial judge used the Roth Standard incorporated in the above statute.
Since the final decree in this cause, the U.S. Supreme Court decided Miller, supra. We consider under the *674 facts of this case that the Roth test embodied in our statute was more stringent than the subsequent Miller doctrine. Therefore, appellant can hardly complain that the Miller standards have worked to its detriment. Moreover, we are here dealing with a civil remedial statute with ample due process safeguards and since we are in the civil realm we need not be quite so conscious of the strictures attendant in criminal prosecution. We believe that the reasoning in Pierce v. State, 292 Ala. 473, 296 So.2d 218 (1974), applies with equal force here; specifically, that definitional infirmities in the Alabama Red Light Abatement Act were cured by judicial construction. Accord, State ex rel. Ewing v. "Without a Stitch", 37 Ohio St.2d 95, 307 N.E.2d 911 (1974); Gordon v. Christenson, 317 F. Supp. 146 (D.Utah 1970); Grove Press Inc. v. Evans, 306 F.Supp. 1084 (E.D.Va.1969).
Appellant argues in the alternative that notwithstanding curative judicial construction, the legislature did not intend the Alabama Red Light Abatement Act to be applicable. There is a substantial amount of persuasive authority for this proposition from judicial interpretation in sister states of their respective Red Light Abatement Acts strikingly comparable to our own. In People v. Goldman, 7 Ill.App.3d 253, 287 N.E.2d 177 (1972), it was held that, as used in its statute, "lewdness" was a synonym for prostitution and therefore the Act did not apply to the activity there sought to be enjoined (a "pornoshop"). Similarly, in Gulf States Theatres of Louisiana v. Richardson, supra, the Louisiana Supreme Court reasoned that its public nuisance statute passed in 1918, only one year prior to our own, was originally designed to control prostitution and gambling and therefore could not be used in the First Amendment area. The court also emphasized the fact that the statute contained virtually no standards for making judicial determinations of obscenity. Accord, Southland Theatre, Inc. v. State ex rel. Tucker, 495 S.W.2d 148 (Ark.Sup.Ct. 1973); Harmer v. Tonlyn Productions, Inc., 23 Cal.App.3d 941, 100 Cal.Rptr. 576 (1972).
However, from the broad language of Tit. 7, § 1091, Code, supra, there is no indication of any legislative intent to either include or exclude its application to obscene material. Controlling here is the fact that the Alabama Red Light Abatement Act has been construed as being merely declaratory of the common law, Duncan v. City of Tuscaloosa, 257 Ala. 574, 60 So.2d 438 (1952), and, as previously noted, acts at common law contrary to public morals were considered as public nuisances and subject to abatement as such.
The second aspect regarding burden of proofwhich party upon whom the burden fallsis resolved in favor of the State. The Alabama Red Light Abatement Act contains none of the burden shifting evils present in Near v. State of Minnesota, supra, or Freedman v. State of Maryland, 380 U.S. 51, 85 S.Ct. 734, 13 L.Ed.2d 649 (1965). The transcript clearly shows that the prosecution was called upon and did in fact meet its burden of proof. Neither the Alabama Red Light Abatement Act nor the Alabama Law on Obscenity authorizes any pre-exhibition licensing or permit procedure. The transcript reveals that appellant was not restrained from exhibiting the allegedly obscene films until after a final adversary proceeding on the issue.
The next requirementprompt judicial review of any administrative or executive suppressionis also due to be resolved in favor of the State. As noted, the Act does not allow nor was there in fact any suppression of appellant's activities until after final adjudication on the issue of obscenity. Although the Act does make provision for issuance of a temporary injunction after the filing of the original complaint, Tit. 7, § 1095, Code, supra, a hearing thereon must be had within ten *675 days, ibid. The provision for an ex parte restraining order, Tit. 7, § 1096, is expressly limited to "the moving or in any manner interfering with the personal property and contents of the place where such nuisance is alleged to exist . . . ." and imposes no restraint upon continuing exhibitions of films until trial on the merits.
Although not at issue here, the application of Tit. 7, § 1101, providing for the closing of the premises pending final determination, presents a more troublesome problem which could constitute a pre-adjudicatory suppression of exhibition.
In Teitel Film Corporation v. Cusack, 390 U.S. 139, 88 S.Ct. 754, 19 L.Ed.2d 966 (1968), the United States Supreme Court struck down for want of prompt judicial review a city licensing ordinance which provided a 50 to 57 day administrative process before judicial review could be had. The Teitel decision, however, dealt with situations where administrative procedures in effect stayed the hand of the judiciary thereby preventing its prompt intervention, supervision, and final determination on the issue of obscenity. See also Jodbar Cinema, Ltd. v. Sedita, 309 F.Supp. 868 (W.D.N.Y.1970); Freedman v. State of Maryland, supra.
Under the Alabama Red Light Abatement Act, however, pre-adjudicatory restraint in the form of a temporary injunction is saved by other mandatory provisions in the Act which insure a speedy final resolution of the ultimate issue of obscenity. Tit. 7, § 1095, requires a hearing on that issue within ten days of the issuance of the temporary injunction; Tit. 7, § 1101, requires that the defendant must be given at least five days notice prior to the hearing on the matter of whether such an injunction will be granted; and Tit. 7, § 1103, requires that final adjudication shall take "precedence over all other cases except injunctions." Furthermore, the United States Supreme Court has held that the right to a speedy determination arises only where one has been ex parte deprived of a right. United States v. Thirty-Seven Photographs, 402 U.S. 363, 91 S.Ct. 1400, 28 L.Ed.2d 822 (1971); Blount v. Rizzi, supra. See also Society to Oppose Pornography, Inc. v. Thevis, 255 So.2d 876 (La. App.1972).
Turning to the last procedural requirementconstitutional prohibition against prior restraint of allegedly obscene expression without immediate judicial determination, any system for the regulation of obscene expression involving prior restraints comes to the court bearing a heavy presumption against its validity. Bantam Books v. Sullivan, 372 U.S. 58, 83 S.Ct. 631, 9 L.Ed.2d 584 (1963). The decree of the trial court included an order closing the Fox Theatre for any purpose for one year. This is not a liquor nuisance nor a prostitution nuisance; rather, a movie house charged with showing certain obscene motion pictures. Evidence of obscene conduct in the past does not justify enjoining future conduct which is protected by the First Amendment. People ex rel. Hicks v. Sarong Gals, 27 Cal.App.3d 46, 103 Cal.Rptr. 414 (1972). The padlocking of appellant's operation for one year constitutes prior restraint at its worst and is patently unconstitutional.
While the facts in the recent United States Supreme Court decision of Southeastern Promotions, Ltd. v. Conrad, 420 U.S. 546, 95 S.Ct. 1239, 43 L.Ed.2d 448 (1975), are not directly in point, the reasoning therein is particularly appropriate. We quote:
". . . The presumption against prior restraint is heavierand the degree of protection broaderthan that against limits on expression imposed by criminal penalties. Behind the distinction is a theory deeply etched in our law: a free society prefers to punish the few who abuse rights of speech after they break the law than to throttle them and all others beforehand. It is always *676 difficult to know in advance what an individual will say, and the line between legitimate and illegitimate speech is often so finely drawn that the risks of freewheeling censorship are formidable. See Speiser v. Randall, 357 U.S. 513, 78 S.Ct. 1332, 2 L.Ed.2d 1460 (1958)."
We are not the first jurisdiction to hold unconstitutional as prior restraint of First Amendment guaranties the prospective abatement of movie houses as public nuisances. Society to Oppose Pornography v. Thevis, supra; State of Indiana ex rel. Blee v. Mohney Enterprises et al., Ind., 289 N.E.2d 519 (1972); Gulf States Theatres of Louisiana, Inc. v. Richardson, supra. The Alabama Law on Obscenity, Tit. 14, § 374(1) et seq., provides criminal penalties for conduct such as appellant'sif retributive punishment is sought, those sanctions, not abatement, are the only proper ones authorized by the legislature.
The provision in the Alabama Red Light Abatement Act, Tit. 7, § 1104, supra, allowing for the release on bond is not curative of this constitutional defect. See Society to Oppose Pornography v. Thevis, supra. This remedy is available only if the court is satisfied that the owner had no knowledge of the existence of the nuisance.
We are of the opinion there was ample evidence for the trial judge to conclude that the motion pictures in question are obscene. But we also hold that even if one is guilty of maintaining an obscenity nuisance, it is not constitutionally permissible to deprive him prospectively of his First Amendment rights.
Lest there be any confusion as to the extent of our holding that the Alabama Red Light Abatement Act cannot constitutionally be employed to enjoin prospectively the showing of films in enclosed movie theatres to an adult audience, we hasten to delimit this opinion to at least two First Amendment situations in which that statute so applied might pass constitutional muster.
The first would be where the impact of the injunction is absolutely devoid of prior restraint or chilling effect upon prospective exercises of expression other than that adjudicated as obscene. More specifically, where there has been a prompt adversary proceeding in which all the requisite constitutional standards for ascertaining the issue of obscenity have been met and the particular film has been found to be obscene; future exhibition of that particular film may well constitute a public nuisance and be permanently enjoined as such. See, Evans Theatre Corporation v. Slaton, supra; Coctus Corporation v. State ex rel. Murphy, 14 Ariz.App. 38, 480 P.2d 375 (1971); State ex rel. Keating v. Vixen, 27 Ohio St.2d 278, 272 N.E.2d 137 (1971); contra, Harmes v. Tonlyn Productions, Inc., supra.
The second involves situations where there is a foisting off of patently obscene films, not fit for children to see, in places within their view to include public streets and facilities, residential properties, and private houses. Such activity may also constitute a public nuisance subject to equitable injunction where, of course, attendant constitutional substantive and procedural safeguards are present. See Bloss v. Paris Township, 380 Mich. 466, 157 N.W.2d 260 (1968) (drive-in theatres exhibiting films not fit for minors in plain view of public streets and surrounding residences subject to abatement as a public nuisance). But see the recent case of Erznoznik v. City of Jacksonville, 422 U.S. 205, 95 S.Ct. 2268, 45 L.Ed.2d 125 (1975).
The foregoing possible exceptions should not be construed by prosecuting authorities as a green light for prospective control of particular obscene films or drive-in theatres which broadcast such films. We again point up the imprecise nature of public nuisance doctrine which is ill-equipped to cope with the intricacies of First Amendment guaranties. The law of nuisance cannot become a vehicle for the protection of the sensibilities of the overly *677 fastidious; nor can the doctrine of nuisance serve as a means of circumventing these First Amendment safeguards. The requirements of the First Amendment are stringent and demandingany regulatory scheme which impinges upon these most precious rights will be assured of close scrutiny.
The judgment in this cause is due to be and hereby is reversed and the cause remanded for further proceedings not inconsistent with this opinion.
Reversed and remanded.
MERRILL, FAULKNER and EMBRY, JJ., concur.
JONES, J., concurs in the result.
MADDOX, J., concurs specially.
HEFLIN, C.J., with whom BLOODWORTH and SHORES, JJ., join, concurs in the result, with opinion.
MADDOX, Justice (concurring specially).
I agree that the injunction issued here which prohibits the showing of any film for one year is overbroad, but I cannot agree that the trial judge is powerless to act.
The Fox Cinema Theatre had been used consistently to show films which depicted:
"(a) Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated.
"(b) Patently offensive representations or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals." Miller v. California, 413 U.S. 15, 93 S.Ct. 2607, 37 L.Ed.2d 419.
Chief Justice Burger, writing for a majority of the court, in Miller, said that the states could regulate illegal conduct such as occurred in this case. One of the regulatory schemes which the Supreme Court, in Miller, said was permissible, includes: "applicable state law, as written or authoritatively construed." Miller gave this Court the power to set the guidelines for regulation of works which depict or describe sexual conduct. It is my opinion, therefore, that a trial judge, using Miller standards, could enjoin the operation of a place as a public nuisance if the place had been used for the purpose of showing films which were obscene, under the Miller test. In view of the authority granted to this court under Miller, I do not think that this Court is so judicially weak, or should be so timid, that it cannot, or will not, "authoritatively construe" our redlight abatement law in such a manner that trial courts could regulate conduct which Miller specifically authorizes states to regulate.
Mr. Chief Justice Burger recognized in Miller that courts would not have an easy road, free from difficulty. He said:
"* * * But no amount of `fatigue' should lead us to adopt a convenient `institutional' rationalean absolutist, `anything goes' view of the First Amendment because it will lighten our burdens. `Such an abnegation of judicial supervision in this field would be inconsistent with our duty to uphold the constitutional guarantees.' Jacobellis v. Ohio, supra, 378 U.S. at 187-188, 84 S.Ct. [1676] at 1678 [12 L.Ed.2d 793] (opinion of Brennan, J.). Nor should we remedy `tension between state and federal courts' by arbitrarily depriving the States of a power reserved to them under the Constitution, a power which they have enjoyed and exercised continuously from before the adoption of the First Amendment to this day. See Roth v. United States, supra, 354 U.S. at 482-485, 77 S.Ct. [1304], at 1307-1309 [1 L.Ed.2d 1498]. `Our duty admits of no "substitute for facing up to the tough individual problems of constitutional judgment involved in every obscenity case." [Citations omitted.]'" *678 This Court is the highest court of this state. It is the highest court which can "authoritatively construe" our state laws. I think an examination of the Miller opinion clearly indicates that the Supreme Court of the United States intended state courts to construe their state statutes so as to incorporate the specifically prohibited conduct given as examples in the Miller case. I think that it is important that we keep in mind that the prohibited acts need not be specifically written in any applicable state law, but rather, a judicial construction may be obtained to authoritatively construe any statute so as to incorporate specifically prohibited acts.
It seems clear to me that state courts have the authority to authoritatively construe state statutes and that this is made imminently clear by an analysis of the Miller opinion. Miller was "vacated and remanded for further proceedings" rather than being outright reversed. I believe that if the Supreme Court was of the opinion that the California statute under consideration in Miller could not be authoritatively construed so as to incorporate the new guidelines, the Miller case would have been reversed outright rather than being remanded for further proceedings.
The key to the Supreme Court's reasoning in this regard seems to be contained in footnote 7 of the case of United States v. 12 200-Ft. Reels, 413 U.S. 123, 93 S.Ct. 2665, 37 L.Ed.2d 500 (1973), handed down the same day as Miller. Footnote 7 in United States v. 12 200-Ft. Reels, reads as follows:
"We further note that, while we must leave to state courts the construction of state legislation, we do have a duty to authoritatively construe federal statutes where `"a serious doubt of constitutionality is raised"' and `"a construction of the statute is fairly possible by which the question may be avoided."' United States x. Thirty-Seven Photographs, 402 U.S. 363, 369, 91 S.Ct. 1400, 1404, 28 L. Ed.2d 822 (1971) (opinion of White, J.), quoting from Crowell v. Benson, 285 U. S. 22, 62, 52 S.Ct. 285, 296, 76 L.Ed. 598 (1932). If and when such a `serious doubt' is raised as to the vagueness of the words `obscene,' `lewd,' `lascivious,' `filthy,' `indecent,' or `immoral' as used to describe regulated material in 19 U.S. C. § 1305(a) [19 U.S.C.S. § 1305(a)] and 18 U.S.C. § 1462 [18 U.S.C.S. § 1462], see United States v. Orito, supra, 413 U.S. at 140 n. 1, 93 S.Ct. [2674] at 2676 n. 1, [37 L.Ed.2d at 516] we are prepared to construe such terms as limiting regulated material to patently offensive representations or descriptions of that specific `hardcore' sexual conduct given as examples in Miller v. California, supra, 413 U.S. at 25, 93 S.Ct. [2607] at 2615 [37 L.Ed.2d at 431]. See United States v. Thirty-Seven Photographs, supra, 402 U.S. at 369-374, 91 S.Ct. [1400], at 1404-1407 [28 L.Ed.2d 822] (opinion of White, J.). Of course, Congress could always define other specific `hardcore' conduct."
It is significant that in the concluded portions of every opinion handed down concomitantly with Miller, the Supreme Court cites to footnote 7 of 12 200-Ft. Reels wherein the court construed the federal obscenity statutes as incorporating the specific representations and description of hard-core sexual conduct "given as examples in Miller v. California, supra."
The reason why the state court cases were remanded for further proceedings is also disclosed in footnote 7 of 12 200-Ft. Reels. The court noted that while it had the power to authoritatively construe federal statutes, it did not possess the authority with reference to state statutes.
This is the reason why whenever any state court judgment (such as Miller) was vacated and remanded for further proceedings, the Supreme Court specifically referred the state court to footnote 7 of United States v. 12 200-Ft. Reels. I construe these judgments of the Supreme Court of the United States as actually inviting *679 the state courts to authoritatively construe their own state statutes just as the federal statutes were construed by the Supreme Court itself in 12 200-Ft. Reels.
It seemed clear to me that states are free to proceed with obscenity prosecutions under the new Miller standards, so long as the state courts construe and apply state obscenity statutes in a manner consistent with the new Miller guidelines.
The only constitutional problem I see in this case is the prior restraint inherent in the injunctive relief granted, but I believe relief could be tailored which would regulate illegal conduct, protect First Amendment rights, and would permit the operation of the business to show films which were not obscene. In short, the trial judge had voluminous evidence before him that the Fox Cinema Theatre was being used for an illegal activity. Faced with this overwhelming evidence of a pattern and practice of illegal conduct, and having determined the obscenity vel non of the films which were shown there, the trial court could have enjoined the further use of the theatre to show films which were "(a) Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated; (b) Patently offensive representations or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals."
Under Miller, I believe the trial judge, under authority of Alabama's Red Light Abatement Act could permanently enjoin the use of the theatre for showing obscene films and could require anyone desiring to use the theatre for a legitimate purpose to submit a plan which would show the purpose for which the theatre would be used and the trial court could determine promptly whether the proposed use was for a legitimate purpose, using the Miller standard, of course.
A California court, using a Red Light Abatement Act, permanently enjoined a tavern, its owner and operator and any other person from maintaining, using or occupying the premises for the purpose of "lewdness," closed the premises to all uses for one year except uses not involving entertainment, and ordered the sheriff to remove all fixtures, equipment and musical instruments from the tavern and to close the building for one year. People ex rel. Hicks v. "Sarong Gals," 42 Cal.App.3d 556, 117 Cal.Rptr. 24 (1974).
The common law of public nuisance may be a valid method by which to implement the state's police power in cases such as this one. In Grove Press Inc. v. City of Philadelphia, 418 F.2d 82 (3 Cir., 1969), the court held that the court procedures chosen by the city there were improper, but the court spelled out how the city could regulate the showing of obscene films. It said:
"The mischief we perceive in the Pennsylvania equity rules is that there is no guarantee a final hearing will be seasonably scheduled after the issuance of a preliminary injunction and that a prompt decision will be forthcoming thereafter. The preliminary restraint could exist days, and even months, before the judicial decision on the merits; where this possibility exists, an unacceptable threat to the freedom of expression without due process of law results. Failure to provide the necessary expeditiousness tinges the Pennsylvania preliminary injunctive procedures with unconstitutional hues when they are employed to restrain or inhibit expression prior to a final adjudication of an alleged obscene matter.
"We do not challenge, we reiterate, the postulate that `the primary requirements of decency may be enforced against obscene publications.' Kingsley Books, Inc. v. Brown, 354 U.S. 436, 77 S.Ct. 1325, 1 L. Ed.2d 1469 (1957). This means that relief may be sought in both the civil and criminal branches of the Pennsylvania court system to enforce state laws on obscenity, consonant with the Due Process Clause of the Fourteenth Amendment and the guarantee *680 of First Amendment expression. It is only when the right of the state to regulate obscenity collides with undue inhibition of protected expression that a problem of constitutional dimension arises. Where expression is inhibited as a result of prompt judicial decision reached after an adversary proceeding, there can be no procedural due process complaint. But where the inhibition occurs in a preliminary proceeding, with no guarantee of a prompt judicial decision on the merits, the procedure is constitutionally defective because a restraint of presumably protected expression not only occurs but is capable of persisting for an unlimited time prior to the required judicial determination.
"Our conclusion is not novel in Pennsylvania jurisprudence. The same basic determination has already been alluded to by Mr. Justice O'Brien, speaking for an evenly divided state Supreme Court in Commonwealth v. Guild Theatre, Inc., 432 Pa. 378, 248 A.2d 45 (1968), where the validity of employing the Pennsylvania equity rules to enjoin obscene exhibitions was also raised. There, the state authorities had secured an ex parte injunction without affording the exhibitors any opportunity to be heard. In ruling such procedures constitutionally defective, Mr. Justice O'Brien observed:
"`However, even if a proper hearing had been held, the instant proceeding was fatally defective in another respect. * * * Although we cannot agree with appellants' contention that no prior restraint on the exhibition of a motion picture is permissible, it is clear that any such restraint must be carefully circumscribed. In Freedman v. State of Maryland, 380 U.S. 51, 58, 85 S.Ct. 734, 739, 13 L.Ed.2d 649 (1965) the Supreme Court discussed the "procedural safeguards designed to obviate the dangers of a censorship system." One of these safeguards was a prompt, final judicial decision. * * * The fact that appellants may have been offered a full dress hearing within four days of the original restraint does not suffice. Quite clearly, there is no provision for a prompt decision. It is vital that the continuance of First Amendment freedoms not be dependent upon the efficiency of a particular judge but upon procedural safeguards clearly embodied in a statute. We can only suggest, as did the Court in Freedman, supra, that a model for such a statute which can safeguard both the First Amendment freedoms of exhibitors and publishers, and the freedom from obscenity of society as a whole can be found in Kinglsey (sic) Books, Inc. v. Brown, 354 U.S. 436, 77 S.Ct. 1325, 1 L.Ed.2d 1469 (1957). The New York statute there provided for a trial within one day after joinder of issue and a decision within two days of the conclusion of the trial. The instant procedure falls far short of that required.' 248 A.2d at 47-48."
The procedure I suggest, which would require the owner or operator to submit a plan setting out the future course of operation, would constitute some "prior restraint" and "chilling effect," if a prompt decision is made. I believe the test mentioned in Grove Press is met. While the protection against prior restraint is an important right, it is not an absolute one. Kingsley Books, Inc. v. Brown, 354 U.S. 436, 77 S.Ct. 1325, 1 L.Ed.2d 1469 (1947).
Chief Justice Burger commented, in Miller, on the spectre of repression which the dissenting Justices feared. He wrote:
"The dissenting Justices sound the alarm of repression. But, in our view, to equate the free and robust exchange of ideas and political debate with commercial exploitation of obscene material demeans the grand conception of the First Amendment and its high purposes in the historic struggle for freedom. It is a `misuse of the great guarantees of free spech and free press . . . .' Breard v. Alexandria, 341 U.S. at 645, 71 S.Ct. [920], at 934 [95 L.Ed. 1233, 35 ALR2d 335]. The First Amendment protects works which, taken as a whole, *681 have serious literary, artistic, political, or scientific value, regardless of whether the government of a majority of the people approve of the ideas these works represent. `The protection given speech and press was fashioned to assure unfettered interchange of ideas for the bringing about of political and social changes desired by the people,' Roth v. United States, supra, 354 U.S. at 484, 77 S.Ct. [1304], at 1308 [1 L.Ed.2d 1498] (emphasis added). See Kois v. Wisconsin, 408 U.S. at 230-232, 92 S.Ct. [2245], at 2246-2247 [33 L.Ed.2d 312]; Thornhill v. Alabama, 310 U.S. at 101-102, 60 S. Ct. [736], at 743-744 [84 L.Ed. 1093]. But the public portrayal of hardcore sexual conduct for its own sake, and for the ensuing commercial gain, is a different matter.
"There is no evidence, empirical or historical, that the stern 19th century American censorship of public distribution and display of material relating to sex, see Roth v. United States, supra, 354 U.S. at 482-485, 77 S.Ct. [1304], at 1307-1309 [1 L.Ed.2d 1498], in any way limited or affected expression of serious literary, artistic, political, or scientific ideas. On the contrary, it is beyond any question that the era following Thomas Jefferson to Theodore Roosevelt was an `extraordinarily vigorous period,' not just in economics and politics, but in belles lettres and in `the outlying fields of social and political philosophies.'
"We do not see the harsh hand of censorship of ideasgood or bad, sound or unsoundand `repression' of political liberty lurking in every state regulation of commercial exploitation of human interest in sex."
Consequently, I believe that the trial judge, although following state law, went too far in restraining the use of the theatre for legitimate purposes. This I do not think he could do, but I think he could ensure that if it was used, it would be for legitimate purposes, and not as it had been.
HEFLIN, Chief Justice (concurring in the result):
I concur in the result of the majority opinion in this cause but disagree with the language which attempts to cure the socalled definitional infirmities in the Alabama Red Light Abatement Act by judicial construction.
The majority opinion attempts to make the reasoning in Pierce v. State, 292 Ala. 473, 296 So.2d 218 (1974), applicable to the Alabama Red Light Abatement Act. In Pierce, this court engrafted by judicial construction the requirements of Miller v. California, 413 U.S. 15, 93 S.Ct. 2607, 37 L.Ed.2d 419 (1973) to the 1961 Alabama Obscenity Statute to make it constitutional.
While Miller v. California, supra, substituted a less stringent prosecutorial requirement than the one developed from Roth v. United States, 354 U.S. 476, 77 S.Ct. 1304, 1 L.Ed.2d 1498 (1957) and Memoirs v. Massachusetts, 383 U.S. 413, 86 S.Ct. 974, 16 L.Ed.2d 1 (1966), in regard to literary, artistic, political or scientific values, it also addressed the issue of limiting specificity necessary for criminal obscenity statutes to withstand constitutional attacks on vagueness and overbreadth grounds.
The majority opinion states that the definitional infirmities in the Alabama Red Light Abatement Act are cured by judicial construction. However, I cannot find in the majority opinion any language by which the requirements of Miller are added to the statute in question. I assume that the intent of the majority opinion is to engraft Miller's requirements of limiting specificity to the Alabama Red Light Abatement Act. Even if such language did appear in the majority opinion to accomplish such intent, I would, nevertheless maintain that the court does not have the right to judicially engraft these requirements of limiting specificity to the Alabama Red Light Abatement Act.
The following appears in Miller:
"This much has been categorically settled by the Court, that obscene material *682 is unprotected by the First Amendment. Kois v. Wisconsin, 408 U.S. 229, 92 S.Ct. 2245, 33 L.Ed.2d 312 (1972); United States v. Reidel, 402 U.S., at 354, 91 S. Ct. [1410], at 1411-1412; Roth v. United States, supra, 354 U.S. at 485, 77 S.Ct. [1304], at 1309 `The First and Fourteenth Amendments have never been treated as absolutes [footnote omitted]'. Breard v. Alexandria, 341 U.S. at 642, 71 S.Ct. [920], at 932, and cases cited. See Times Film Corp. v. Chicago, 365 U.S. 43, 47-50, 81 S.Ct. 391, 393-395, 5 L.Ed.2d 403 (1961); Joseph Burstyn, Inc. v. Wilson, 343 U.S., at 502, 72 S.Ct. [777], at 780. We acknowledge, however, the inherent dangers of undertaking to regulate any form of expression. State statutes designed to regulate obscene materials must be carefully limited. See Interstate Circuit, Inc. v. Dallas, supra, 390 U.S. at 682-685, 88 S.Ct. [1298], at 1302-1305. As a result, we now confine the permissible scope of such regulation to works which depict or describe sexual conduct. That conduct must be specifically defined by the applicable state law, as written or authoritatively construed. * * * A state offense must also be limited to works which, taken as a whole, appeal to the prurient interest in sex, which portray sexual conduct in a patently offensive way, and which, taken as a whole, do not have serious literary, artistic, political, or scientific value.
"The basic guidelines for the trier of fact must be: (a) whether `the average person, applying contemporary community standards' would find that the work, taken as a whole, appeals to the prurient interest, Kois v. Wisconsin, supra, 408 U.S. at 230, 92 S.Ct. at 2245, quoting Roth v. United States, supra, 354 U.S. at 489, 77 S.Ct. [1304] at 1311; (b) whether the work depicts or describes, in a patently offensive way, sexual conduct specifically defined by the applicable state law; and (c) whether the work, taken as a whole, lacks serious literary, artistic, political, or scientific value. We do not adopt as a constitutional standard the `utterly without redeeming social value' test of Memoirs v. Massachusetts, 383 U.S. at 419, 86 S.Ct. [975], at 977 [16 L.Ed.2d 1]; that concept has never commanded the adherence of more than three Justices at one time. * * * See supra, at 2613. If a state law that regulates obscene material is thus limited, as written or construed, the First Amendment values applicable to the States through the Fourteenth Amendment are adequately protected by the ultimate power of appellate courts to conduct an independent review of constitutional claims when necessary. See Kois v. Wisconsin, supra, 408 U.S. at 232, 92 S.Ct. [2245], at 2247; Memoirs v. Massachusetts, supra, 383 U.S. at 459-460, 86 S.Ct. [975], at 998 (Harlan, J., dissenting); Jacobellis v. Ohio, 378 U.S., at 204, 84 S.Ct. [1676], at 1686 (Harlan, J., dissenting); New York Times Co. v. Sullivan, 376 U.S. 254, 284-285, 84 S.Ct. 710, 728, 11 L.Ed.2d 686 (1964); Roth v. United States, supra, 354 U.S. at 497-498, 77 S. Ct. [1304], at 1315-1316 (Harlan, J., concurring and dissenting).
"We emphasize that it is not our function to propose regulatory schemes for the States. That must await their concrete legislative efforts. It is possible, however, to give a few plain examples of what a state statute could define for regulation under part (b) of the standard announced in this opinion, supra:
"(a) Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated.
"(b) Patently offensive representations or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals." (Emphasis supplied)
One of the requirements in Miller was that the statutes designed to regulate obscene matters can not be overly broad but must be carefully limited by legislative act *683 or judicial construction. The following language in Pierce reflects this court's treatment of this requirement:
"In Miller, the court attempted to provide `positive guidance' to other courts dealing with obscenity issues. The court recognized `the inherent dangers of undertaking to regulate any form of expression.' Therefore, the court continued, `[s]tate statutes designed to regulate obscene materials must be carefully limited.' The first limitation mentioned by the court was the scope of the statute: `[W]e now confine the permissible scope of such regulation to works which depict or describe sexual conduct.' Furthermore, `[t]hat conduct must be specifically defined by the applicable state law, as written or [as] authoritatively construed.' Other guidelines are succinctly stated in the following language:
* * * * * *
"The first issue this court must deal with is whether the statute [the Alabama 1961 Obscenity Statute] contains the necessary specificity as required by Miller. The U.S. Supreme Court in Miller invites judicial construction as a method of supplying the required specificity if such is absent from the statute. * * * [T]his court now specifically incorporates the Miller guidelines or tests heretofore set out into its construction of the word `obscene' in Section 374(3). Thus the operation of the provisions of Section 374(4) applicable in this case is limited to matter which depicts or describes sexual conduct. The regulated matter is more specifically restricted to (a) `Patently offensive representations or descriptions of ultimate sexual acts, normal or perverted, actual or simulated,' or (b) `Patently offensive representation or descriptions of masturbation, excretory functions, and lewd exhibition of the genitals.'" (Emphasis supplied)
From Miller it was concluded that in the absence of legislative language supplying the necessary limiting specificity, some state statutes could be judicially construed by engrafting to the statute the necessary limiting specificity and thereby pass constitutional muster. In fact, Miller seems to invite judicial construction as a method of supplying the required limiting specificity if such language is absent from the statute. While normally the task of providing limiting specificity to a statute is a legislative function, nevertheless, this court engrafted such limiting specificity to the 1961 Obscenity Statute because of the U.S. Supreme Court's invitation to do so.
Now the majority opinion goes beyond statutes designated to control obscenity and attempts to make the Alabama Red Light Abatement Act a weapon against "hardcore pornography." Obviously, the legislature felt that this act was not an obscenity control statute. This act was passed in 1919 and was on the books when the 1961 Obscenity Act was passed. The 1961 Obscenity Act possesses all of the injunctive relief features which the majority opinion would give to this act. See Title 14, §§ 374(5)-(11), Code of Alabama, 1940, as amended (1958 Recompiled1973 Cumulative Supp.). Further, there is no invitation from the Supreme Court of the United States for judicial construction to supply the necessary limiting specificity to this statute. I interpret Miller as limiting judicial construction engraftments to statutes designed to specifically control obscenity. The act in question is indeed broad and comprehensive in its scopemuch more so than the 1961 Obscenity Statute. In my opinion the majority opinion goes beyond the pale of permissible judicial construction and crosses over into the realm of exclusive legislative drafting by attempting to apply the same reasoning as was applied in Pierce.
Another reason why I cannot concur in the treatment given by the majority opinion involves a consideration of the residual effects that will inure to the Alabama Red Light Abatement Act following such judicial engraftments. Before such engraftments the act in question was a broad, comprehensive act, useful to the State in fighting battles against prostitution, assignation *684 and lewdness. If the majority opinion engrafts the requirements of Miller to this act then this act will have to be construed in the future in a much more narrow and restricted sense and can only be used as a weapon against prostitution, assignation and hard-core pornography. The former broad protective scope given to "lewdness" is considerably reduced by the majority opinion.
As was previously pointed out, the 1961 Obscenity Act provides within its arsenal injunctive relief from obscene materials. This act can be used to enjoin the showing of obscene motion picture films. There is no real reason to transform the Alabama Red Light Abatement Act into an injunctive relief procedure to combat hard-core pornographic films because such a procedure has been available since 1961.
For the reasons set forth above, I respectfully disagree with certain specified aspects of the majority opinion but feel that the result reached by the majority is correct.
BLOODWORTH and SHORES, JJ., concur.
NOTES
[*] This case was originally assigned to a justice formerly on this court. It has been reassigned to the writer who has listened to the tape recordings of the oral argument. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2021479/ | 172 B.R. 1002 (1994)
In re SEAESCAPE CRUISES, LTD., Debtor.
SKANDINAVISKA-ENSKILDA BANKEN, Appellant,
v.
C.L.C. MARINE SERVICES, LTD., Appellee.
C.L.C. MARINE SERVICES, LTD., Appellant,
v.
SKANDINAVISKA-ENSKILDA BANKEN, Appellee.
SKANDINAVISKA-ENSKILDA BANKEN, Appellant,
v.
C.L.C. MARINE SERVICES, INC., Appellee.
Nos. 94-0110-CIV, 94-0288-CIV, 94-0412-CIV and 91-11121-BKC-PGH.
United States District Court, S.D. Florida.
September 30, 1994.
*1003 *1004 Robert A. Schatzman, Miami, FL, for SeaEscape Cruises, Ltd.
Andrea Fischer, Alan Heblack, Mark C. Flavin, Jon Yard Arnason, James H. Hohenstein, Haight, Gardner, Poor & Havens, New York City, Jay M. Gamberg, Law Offices of Jay M. Gamberg, P.A., Hollywood, FL, for Skandinaviska-Enskilda Banken.
Helena Marie Tetzeli, Steven M. Weinger, Kurzban Kurzban & Weinger, P.A., Miami, FL, for C.L.C. Marine Services, Ltd. in Nos. 94-0110-CIV, 94-0288-CIV.
J. Raul Cosio, Holland & Knight, Miami, FL, for C.L.C. Marine Services, Inc. in No. 94-0412-CIV.
Daniel Douglass, Fort Lauderdale, FL.
ORDER AFFIRMING DECISIONS OF THE BANKRUPTCY COURT GRANTING MARITIME LIEN CLAIMS IN FAVOR OF C.L.C. MARINE SERVICES, INC. AND C.L.C. MARINE SERVICES, LTD.
ARONOVITZ, District Judge.
This matter concerns three separate appeals in the Chapter 11 bankruptcy case of SeaEscape Cruises, Ltd. In the appeal designated as Case No. 94-0110-CIV-ARONOVITZ, Skandinaviska-Enskilda Banken ("SE Banken") appeals from the Findings of Fact and Conclusions of Law on Objections to Maritime Lien Claim of C.L.C. Marine Services, Ltd., entered on November 12, 1993 by Judge Paul G. Hyman, Jr. of the United *1005 States Bankruptcy Court for the Southern District of Florida. In the appeal designated as Case No. 94-0412-CIV-ARONOVITZ, SE Banken appeals from the Findings of Fact and Conclusions of Law on Objections to Maritime Lien Claim of C.L.C. Marine Services, Inc., entered on December 14, 1993 by Judge Hyman. In the appeal designated as Case No. 94-0288-CIV-ARONOVITZ, C.L.C. Marine Services, Ltd. appeals from the Order Denying C.L.C. Marine Services, Ltd.'s Motion for Attorney's Fees, entered on January 13, 1994 by Judge Hyman.
The aforementioned appeals were consolidated for appellate review, and on September 9, 1994, the Court heard oral argument thereon.[1] The Court has considered the briefs on appeal, oral argument of counsel, the decisions of the bankruptcy court, the applicable law and the pertinent portions of the record, and is otherwise fully advised in the premises. For the reasons stated herein, this Court hereby AFFIRMS the decision of the bankruptcy court in each of the three above-captioned appeals.
Factual and Procedural Background
This appeal stems from a dispute over the validity of the maritime lien claims of C.L.C. Marine Services, Inc. ("CLC Inc."), a Florida corporation with an office in Miami, Florida, and C.L.C. Marine Services, Ltd. ("CLC Ltd."), an English corporation with an office in Southampton, England, against the M/V Scandinavian Song (the "M/V Song" or the "Vessel").
Renovations to the M/V Song
The Debtor, SeaEscape Cruises, Ltd. ("SeaEscape") was a Bahamian corporation that offered one-day cruises from Miami, Florida. Its fleet included the M/V Song, a vessel which it leased from the owner, Ferry Charter Limited of Florida, pursuant to a charter agreement between the parties. Paragraph 14 of the charter agreement contained a no lien clause that barred SeaEscape from permitting any liens to attach to the Vessel.
Shortly after SeaEscape retained possession of the M/V Song in 1990, it hired CLC Inc. to perform renovation and repair work on the Vessel. The preliminary terms of the deal were first memorialized in a Letter of Intent dated September 29, 1990. Paragraph 9 of the Letter of Intent contained the following waiver clause:
Owner shall always retain full possession of the Vessel and materials, and CLC waives any right to prevent the Vessel from sailing, and waives any claim of lien against the Vessel.
The Letter of Intent further stated that "[a] formal contract incorporating these terms will be signed by October 5, 1990." It was signed by John Chillingworth, the Vice President of Technical and Marine Operations of SeaEscape and by Kenneth Engstrom, Director and General Manager of CLC Inc.
On October 4, 1990, CLC Inc. and SeaEscape entered into the "Refit Contract," the formal contract anticipated in the Letter of Intent. Article 28 of the Refit Contract provides in its entirety the following:
Contractor waives any right it has or may have under this Contract or the law, or otherwise, in rem against Vessel for any *1006 claim arising under or in connection with this contract for purposes of obtaining security or jurisdiction with respect to any such claims; provided that should Contractor obtain a judgment against Owner and should that judgment remain unsatisfied or enforcement remain unstayed for thirty-one (31) days, Contractor shall have the right to arrest or attach Vessel so far as permitted by applicable law, for the purpose of enforcing the judgment.
The Refit Contract was signed by the President of SeaEscape and the President of CLC Inc. It identified SeaEscape as the "owner" of the M/V Song.
CLC Inc. subcontracted all or substantially all of the renovation and repair work to CLC Ltd.,[2] which CLC Ltd. performed and completed in Tampa, Florida between October 3, 1990 and November 20, 1990. A bill in the amount of $620,253.54 was submitted to SeaEscape for the value of the goods and services rendered to the M/V Song. SeaEscape declined payment.
CLC Inc.'s and CLC Ltd.'s Claim to a Maritime Lien
When SeaEscape failed to pay for the services rendered, CLC Inc. filed an action in Florida state court on March 8, 1991, seeking an in personam judgment against SeaEscape for the repair and renovation work performed to the M/V Song.[3] Ten days later on March 18, 1991, SeaEscape filed a petition under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the Southern District of Florida, which stayed the state court action pursuant to 11 U.S.C. § 362. CLC Inc. then filed two proofs of claim of a maritime lien in the bankruptcy case in the amount of $96,798.85 (claim # 1174) and $536,072.20 (claim # 1226). CLC Ltd. also filed a proof of claim of a maritime lien in the amount of $517,972.54 (claim # 1087).
At all relevant times, SE Banken (the Appellant herein) held a mortgage on the M/V Song. When the Vessel was transferred from SeaEscape during the course of the reorganization, SE Banken posted a letter of guaranty in favor of any holders of valid maritime liens which had priority over its mortgage on the M/V Song. Pursuant to a prior bankruptcy court order, SE Banken was given the right to contest maritime liens and to assert all claims and defenses of the Debtor SeaEscape. SE Banken filed objections to CLC Inc.'s and CLC Ltd.'s respective claims, contending that no privity existed between CLC Inc. and CLC Ltd., that CLC Inc. and CLC Ltd. failed to file documents adequate to preserve a maritime lien, and that CLC Inc. and CLC Ltd. failed to provide sufficient documentation to show that the services were actually performed. Subsequent thereto, SE Banken argued that CLC Inc. and CLC Ltd. had contractually waived their right to a maritime lien.
A trial on SE Banken's objections to CLC Inc.'s and CLC Ltd.'s proofs of claim was held before Judge Hyman in the United States Bankruptcy Court for the Southern District of Florida on November 1, 1993, primarily on the question of whether CLC Inc. and/or CLC Ltd. had waived their right to a maritime lien under Article 28 of the Refit Contract.
The Bankruptcy Court's Decision
At the trial, the court found that Article 28 was ambiguous and therefore, allowed the admission of parol evidence to determine the true intent of the parties with regard to Article 28. The bankruptcy court found that the parol evidence established, among other things, that prior to the execution of the Letter of Intent, CLC Inc. objected to the waiver language in paragraph 9 thereof and was advised by John Chillingworth of SeaEscape that SeaEscape did not desire for CLC Inc. to waive its right to a maritime lien and that the anticipated formal contract would reflect such intent. See Findings of Fact and *1007 Conclusions of Law on Objection to Claim Filed By CLC Marine Services, Inc. at 5, ¶ 13 (Hyman, J.) (December 14, 1993) (hereinafter referred to as "Bankruptcy Court's December 14, 1993 Decision"). Based upon this representation from SeaEscape, CLC Inc. executed the Letter of Intent. Id. at 6, ¶ 14.
The parol evidence further showed that based upon a second reassurance from SeaEscape on October 1, 1990 that all SeaEscape required was for CLC Inc. to agree to conditionally postpone its right to enforce a maritime lien and that CLC Inc. was not required to waive its maritime lien, CLC Inc. commenced the renovation work on the M/V Song. Id. at 6-7, ¶¶ 16-17.
At the close of SE Banken's case-in-chief, CLC Ltd. moved for a directed judgment in its favor pursuant to Rule 52 of the Federal Rules of Civil Procedure.[4] The court permitted SE Banken to reopen its case and present additional evidence, after which it entered a directed verdict in favor of CLC Ltd. and against SE Banken. The trial then proceeded on the validity of CLC Inc.'s proofs of claim.
The bankruptcy court rendered two separate written decisions on the merits of the trial. On November 12, 1993, the court entered its Findings of Fact and Conclusions of Law on Objections to Maritime Lien Claim of C.L.C. Marine Services, Ltd., wherein it found that CLC Ltd. had a valid maritime lien in the amount of $517,970.54 for the work performed on the M/V Song. A directed verdict and subsequently, a Final Judgment was entered in favor of CLC Ltd. in the amount of $517,970.54. SE Banken appeals and that appeal has been designated as Case No. 94-0110-CIV-ARONOVITZ.
On December 14, 1993, the bankruptcy court entered its Findings of Fact and Conclusions of Law on Objections with regard to CLC Inc.'s proofs of claim. In that decision, the court determined that Article 28 of the Refit Contract did not constitute a waiver by CLC Inc. of its maritime lien rights. It concluded that Article 28 merely created a condition precedent to CLC Inc.'s ability to enforce its maritime lien, namely, it must first obtain an in personam judgment within thirty-one days.[5] The court also relied on the testimony of the witnesses in finding that the parties did not intend a waiver at the time of contracting. It further concluded that to the extent that Article 28 can be read to mean what SE Banken claims, it is based on a mutual mistake of fact or fraudulent inducement on the part of SeaEscape as to the ownership of the M/V Song and thus, was subject to reform by the court so as to reflect the true intent of the parties. Accordingly, the court ruled that CLC Inc. had a valid and enforceable maritime lien in the amount of $620,253.54. Cognizant that it had previously awarded CLC Ltd. $517,940.54 and so as to avoid the possibility of a double recovery by CLC Inc., judgment was entered in CLC Inc.'s favor in the amount of $102,283. SE Banken appeals and that appeal has been designated as Case No. 94-0412-CIV-ARONOVITZ.
After the trial, CLC Ltd. moved for attorneys' fees and sanction pursuant to Bankruptcy Rule 9011, seeking an award of attorneys' fees in the minimum amount of $80,803.50 as part of the award of an appropriate sanction. The basis of that motion was SE *1008 Banken's filed objections to CLC Ltd.'s proof of claim, which, CLC Ltd. claims, were not well grounded in law or in fact and/or were filed for an improper purpose. Following a hearing thereon, the bankruptcy court entered an order, denying CLC Ltd.'s motion. CLC Ltd. appeals from that order, and that appeal has been designated as Case No. 94-0288-CIV-ARONOVITZ.
Discussion
The Court has jurisdiction of these appeals pursuant to 28 U.S.C. § 158(a) (West 1993).
The dominant issue presented on appeal is whether the bankruptcy court erred in concluding that CLC Inc. and CLC Ltd. did not waive their right to a maritime lien under Article 28 of the Refit Contract. Other issues raised on appeal are: (1) whether the bankruptcy court erred in concluding that Article 28 of the Refit Contract was ambiguous so as to allow the admission of parol evidence; (2) whether the bankruptcy court erred in entering a directed verdict in favor of CLC Ltd.; (3) whether the bankruptcy court erred in excluding from the evidence correspondence from CLC Inc.'s then-counsel to SeaEscape under Rule 408 of the Federal Rules of Evidence; and (4) whether the bankruptcy court erred in denying CLC Ltd.'s motion for attorneys' fees against SE Banken.
In accordance with Federal Rule of Bankruptcy Procedure 8013, the Court will not set aside the bankruptcy court's findings of fact unless they are clearly erroneous. In re Chase & Sanborn Corp., 904 F.2d 588 (11th Cir.1990); In re T & B General Contracting, Inc., 833 F.2d 1455 (11th Cir.1987). Equitable determinations by the trial court are subject to review under an abuse of discretion standard, In re Red Carpet Corp. of Panama City Beach, 902 F.2d 883 (11th Cir. 1990), and conclusions of law are subject to de novo review. Chase & Sanborn Corp., 904 F.2d at 593; In re Sublett, 895 F.2d 1381 (11th Cir.1990). The Court will address the issues on appeal in accordance with these standards of review.
A. THE EXISTENCE OF A MARITIME LIEN
The Court will begin its analysis with a brief discussion on maritime liens. Pursuant to § 31342(a)(1) of the Federal Maritime Law Act, "a person providing necessaries to a vessel on the order of the owner or a person authorized by the owner has a maritime lien on the vessel." See 46 U.S.C. § 31342(a)(1); see also, Thorsteinsson v. M/V Drangur, 891 F.2d 1547, 1551 (11th Cir.1990) ("Congress has protected those who furnish supplies and other necessaries to vessels, granting such persons maritime liens against the vessel"). A charterer of a vessel is presumed to have the authority to procure necessaries for a vessel. See 46 U.S.C. § 31341(a)(4)(B); see also, Marine Fuel Supply and Towing, Inc. v. M/V Ken Lucky, 869 F.2d 473, 476 (9th Cir.1988); Belcher Oil Co. v. M/V Gardenia, 766 F.2d 1508, 1512 (11th Cir.1985). The maritime lien arises at the moment "when the goods or services are supplied or performed in the United States." Gulf Trading & Transportation Co. v. The Vessel Hoegh Shield, 658 F.2d 363, 367 (5th Cir.1981), cert. denied, 457 U.S. 1119, 102 S.Ct. 2932, 73 L.Ed.2d 1332 (1982).
Applying these well established principles of maritime law to the facts of this case, SeaEscape, as the charterer of the M/V Song, clearly has the authority to procure necessaries for the Vessel. It is undisputed that the goods and services rendered by CLC Inc. and CLC Ltd. to the Vessel were in fact "necessaries" within the meaning of 46 U.S.C. § 31342(a)(1). Therefore, the Court concludes that upon the rendering of said goods and services, CLC Inc. and CLC Ltd. obtained a valid and enforceable maritime lien against the M/V Song by operation of law.
B. WHETHER CLC INC. OR CLC LTD. WAIVED THEIR RIGHT TO A MARITIME LIEN?
Having determined that CLC Inc. and CLC Ltd. did obtain a maritime lien against the M/V Song, the Court now decides the pivotal issue in this appeal: whether CLC Inc. or CLC Ltd. waived their maritime lien under Article 28 of the Refit Contract. SE Banken contends that because an in rem *1009 action is the only means through which a maritime lien is recognized and enforced, CLC Inc. and CLC Ltd.'s waiver of their right to proceed in rem against the Vessel under Article 28 is equivalent to an absolute waiver of its maritime lien.[6] On the other hand, CLC Inc. and CLC Ltd. argue that Article 28 of the Refit Contract constituted only a conditional waiver of CLC Inc.'s right to enforce their maritime lien, but does not in any way waive, release or preclude their entitlement to a maritime lien.
While a maritime lien may be waived "by agreement or otherwise," see 46 U.S.C. § 31305, there is a "strong presumption" that one furnishing services or supplies to a vessel does not waive a maritime lien. See Stevens Technical Services, Inc. v. United States, 913 F.2d 1521, 1521 (11th Cir. 1990); Vessel Hoegh Shield, 658 F.2d at 368; Sasportes v. M/V Sol de Copacabana, 581 F.2d 1204, 1209 (5th Cir.1978).[7] The burden is placed on the proponent of a waiver to prove that a supplier of necessaries has waived its right to a maritime lien. This burden of proof has been characterized by the Eleventh Circuit as a "heavy burden."
This circuit's cases construing the waiver provision . . . place a heavy burden on the litigant attempting to prove that [a claimant] waived a lien by looking to someone other than the vessel owner for payment.
Stevens, 913 F.2d at 1537 (quoting Gulf Oil Trading Co. v. M/V Caribe Mar, 757 F.2d 743, 750 (5th Cir.1985)).
"[B]ecause of the strong presumptions in favor of a maritime lien . . . it is necessary" for one urging "such a waiver" to prove "that the creditor deliberately intended" to forego the valuable privilege of a maritime lien by looking solely to the personal credit of the party receiving the supplies, repairs, etc.
Id. at 1537 (quoting Sasportes, 581 F.2d at 1209) (emphasis in original). Thus, in this case, SE Banken bears the "heavy burden" of proving that CLC Inc. and CLC Ltd. deliberately intended to waive their maritime liens.
The trial court's determination that there is or is not a waiver of a maritime lien is subject to a "clearly erroneous" standard of review.[8] Based upon a careful review of the record, and for the reasons stated below, this Court concludes that the bankruptcy court was not clearly erroneous in finding that neither CLC Inc. nor CLC Ltd. had waived their maritime liens.
1. Article 28 of the Refit Contract
Article 28 of the Refit Contract provides in its entirety the following:
Contractor waives any right it has or may have under this Contract or the law, or otherwise, in rem against Vessel for any claim arising under or in connection with this contract for purposes of obtaining security or jurisdiction with respect to any such claims; provided that should Contractor obtain a judgment against Owner and should that judgment remain unsatisfied or enforcement remain unstayed for thirty-one (31) days, Contractor shall have the right to arrest or attach Vessel so far as *1010 permitted by applicable law, for the purpose of enforcing the judgment.
The trial court's determination that this provision is ambiguous is subject to de novo review, since the question of whether a contract provision is ambiguous is a conclusion of law. See Barclays American Mortgage Corp. v. Bank of Central Florida, 629 So.2d 978, 979 (Fla. 5th DCA 1993) ("the determination of whether or not a contract provision is ambiguous . . . is a matter of law for the judge"); Sproles v. American States Insurance Co., 578 So.2d 482, 484 (Fla. 5th DCA 1991) (same).
An ambiguity exists "when a word or phrase in a contract is of uncertain meaning and may be fairly understood in more ways than one and is susceptible of more than one meaning and of interpretation in opposite ways." Rey v. Guy Gannett Publishing Co., 766 F.Supp. 1142, 1146 (S.D.Fla.1991). Having carefully reviewed Article 28 of the Refit Contract de novo, the Court finds that that provision is not ambiguous.
It appears to this Court that a plain reading of Article 28 as a whole reveals that it is a conditional waiver of CLC Inc.'s right to enforce its maritime lien. Article 28 states that "Contractor [CLC Inc.] waives any right it has or may have under this Contract or the law, or otherwise, in rem against Vessel for any claim arising under or in connection with this contract for purposes of obtaining security or jurisdiction with respect to any such claims." This provision does not constitute an outright, absolute waiver of CLC Inc.'s rights for any and all purposes whatsoever. Rather, the waiver is limited only "for purposes of obtaining security or jurisdiction." There is absolutely no language to the effect that CLC Inc. agreed to forfeit its right to obtain a maritime lien against the Vessel.
In addition, the limited waiver is subject to a condition precedent. Article 28 states that there is waiver for purposes of obtaining security and jurisdiction, "provided that should Contractor obtain a judgment against the Owner and should that judgment remain unsatisfied or enforcement remain unstayed for thirty-one (31) days, Contractor shall have the right to arrest or attach Vessel so far as permitted by applicable law, for the purpose of enforcing the judgment." The plain meaning of this "provided" clause is that CLC Inc. may arrest or attach the M/V Song (i.e., enforce its maritime lien) if it first obtains an in personam judgment that remains unsatisfied for thirty-one (31) days.
Read in its totality, Article 28 of the Refit Contract clearly created a conditional waiver of CLC Inc.'s right to enforce its maritime lien, conditioned on it first obtaining an in personam judgment. CLC Inc. attempted to satisfy the condition precedent by seeking an in personam judgment against SeaEscape in the state court action but that action was stayed by SeaEscape's bankruptcy filing. The Court further finds that Article 28 does not in any way waive, release, surrender or preclude the existence of a maritime lien in favor of CLC Inc. CLC Inc. simply agreed to conditionally postpone its enforcement rights.
SE Banken argues that by waiving its right to proceed in rem against the Vessel under Article 28, CLC Inc. waived its right to a maritime lien completely. This argument appears to be premised on the proposition that an in rem right is synonymous with the right to a maritime lien. SE Banken relies on the following passage from a well recognized treatise on admiralty and maritime law in support of its contention.
In American jurisprudence the existence of a maritime lien is synonymous with the availability of a libel in rem. As Justice Field wrote in The Rock Island Bridge [, 6 Wall. 213, 73 U.S. 213, 18 L.Ed. 753 (1867)]: "The lien and the proceeding in rem are, therefore, correlative where one exists, the other can be taken, and not otherwise."
Gilmore & Black, The Law of Admiralty at 622 (2d ed. 1975).
The Court does not read this passage as stating that if there is not a right to an in rem proceeding, then a lien does not exist. Rather, the Court interprets Gilmore & Black to mean that where one has a maritime *1011 lien, then an in rem proceeding may be taken to enforce it. The Court's position is buttressed by the well settled principle that the in rem proceeding "is simply a means of enforcing the property right." 2 Benedict on Admiralty, § 22 (6th ed. 1993); see also, Amstar Corporation v. S/S Alexandros T, 664 F.2d 904, 908 (4th Cir.1981) (the purpose of an in rem proceeding "has always been to provide a means for enforcing a maritime lien, which is the central element of an in rem proceeding"); State of California Department of Fish and Game v. S.S. Bournemouth, 307 F.Supp. 922, 927 (C.D.Cal.1969) (the in rem proceeding "is the remedy afforded for the enforcement of liens"). Simply because CLC Inc. conditionally waived its right to enforce its maritime lien through an in rem proceeding does not mean that it waived its right to the lien. Therefore, SE Banken's interpretation of Article 28 is rejected.
Based upon the foregoing, the Court finds that the bankruptcy court was not clearly erroneous in concluding that under Article 28 of the Refit Contract, CLC Inc. only conditionally waived its right to enforce its valid maritime lien against the M/V Song and that CLC Inc. did not waive its entitlement to a maritime lien. This ruling from the Court renders moot SE Banken's argument that CLC Ltd. waived its maritime lien under Article 28 under the theories of privity, imputed knowledge or agency.[9] It follows from the Court's interpretation of Article 28 that CLC Ltd. also did not waive its right to a maritime lien thereunder.
Therefore, the bankruptcy court's decisions that neither CLC Inc. nor CLC Ltd. waived their right to a maritime lien for necessaries provided to the M/V Song should be affirmed.[10]
2. Propriety of the Directed Verdict in Favor of CLC Ltd.
The bankruptcy court's granting of CLC Ltd.'s motion for a directed verdict is subject *1012 to de novo review. Sherrin v. Northwestern Nat'l Life Insurance Co., 2 F.3d 373, 376 (11th Cir.1993); Hasenfus v. Secord, 962 F.2d 1556, 1559 (11th Cir.1992). The trial court should grant a motion for directed verdict if "the facts and inferences point overwhelmingly in favor of one party such that reasonable people could not arrive at a contrary verdict." Carter v. City of Miami, 870 F.2d 578, 581 (11th Cir.1989). The court must consider "all the evidence and the inferences drawn therefrom in the light most favorable to the nonmoving party." Id. at 581. This Court may not affirm the trial court's entry of a directed verdict if the record contains "substantial evidence" opposing the motion. Id. "A mere scintilla of evidence," however, is not sufficient to defeat the motion. Id.; see also Boeing Co. v. Shipman, 411 F.2d 365, 374-75 (5th Cir.1969) (en banc).
SE Banken contends that there was substantial evidence that CLC Ltd. had knowledge of the waiver, which allegedly was imputed to CLC Ltd. by virtue of its relationship to CLC Inc. The Court disagrees.
The record reveals that SE Banken presented only one witness in its case-in-chief, SeaEscape's in-house counsel Mel Lamelas. Mr. Lamelas testified that he advised Mr. Childerstone (president of CLC Inc. and managing director of CLC Ltd.) of the charter agreement and the no-lien provision contained therein before the execution of the Refit Contract but after CLC Ltd. had commenced work on the Vessel. See Trial Tr. at 46. This testimony, however, does not constitute "substantial evidence" that CLC Ltd. knew about the no-lien provision in the charter agreement. In fact, other evidence presented in SE Banken's case-in-chief over-whelmingly established otherwise. The evidence showed that Mr. Lamelas never advised CLC in writing of the existence of the charter agreement, see Trial Tr. at 47, nor did he ever ask CLC Ltd. to sign a written waiver, see Trial Tr. at 59, nor was there notice posted on the M/V Song indicating that it was subject to a charter party agreement or to a no-lien clause. See Trial Tr. at 57.
After CLC Ltd. moved for a directed verdict but before it ruled, the bankruptcy permitted SE Banken to reopen its case, see Trial Tr. at 67-71, to present the testimony of Mr. Childerstone in support of SE Banken's theory that CLC Ltd. should be bound by the acts and knowledge of CLC Inc. The testimony of Mr. Childerstone essentially showed that CLC Inc. and CLC Ltd. shared common officers and personnel who were involved in the deal with SeaEscape.
Following the testimony of Mr. Childerstone, the bankruptcy court granted CLC Ltd.'s motion for a directed verdict, finding that it was clear that CLC Ltd. performed services, for which the quality and amount due were undisputed, that there was "absolutely no evidence" that CLC Ltd. waived its liens in writing, and that there was no evidence that CLC Ltd. had knowledge of the no-lien provision in the bareboat charter agreement prior to providing services. See Trial Tr. at 91-92.
Having reviewed the entire transcript of the trial and the evidence adduced during the trial, this Court finds that even after reopening its case, SE Banken failed to present "substantial evidence" showing that CLC Ltd. had waived its right to a maritime lien. Therefore, the directed verdict was proper and should be affirmed.
3. The Exclusion of Correspondence Under Federal Rule of Evidence 408
At the trial, SE Banken offered into evidence a February 15, 1991 letter from Blackwell & Walker (then counsel to CLC Inc.) to Mr. MacGarvey, then president of SeaEscape, along with an attached proposed Modification Agreement drafted by Blackwell & Walker, as evidence of the parties' understanding that Article 28 of the Refit Contract constituted a waiver of CLC Inc.'s right to a maritime lien. The letter stated that the Refit Contract contains "an extremely inequitable provision which purports to waive the *1013 lien rights of [CLC Inc.] in connection there-with." It proposed that "[t]he lien rights of C.L.C. with respect to the work performed on the Scandinavian Song be reinstated." The proposed attached Modification Agreement provided: "WHEREAS, said contract provided for a waiver by CLC of its rights to proceed in rem against the vessel . . ."
The bankruptcy court declined to admit the Blackwell & Walker letter into evidence, holding that it was an offer to compromise a claim and thus, inadmissible pursuant to Fed. R.Evid. 408.[11] On appeal, SE Banken argues that the letter was admissible on a variety of grounds, such as (1) it was a demand letter and not an offer to compromise a disputed claim; (2) it was an admission by CLC Inc. that its claim of a maritime lien was invalid; (3) to impeach the testimony on CLC Inc.'s witnesses; and (4) to establish CLC Inc.'s understanding that Article 28 constituted a waiver.
The Court has reviewed the letter and attachment at issue. While it is arguable that the letter was not an offer to compromise under Rule 408, the Court is mindful that generally a trial court's decision on the admissibility of evidence is "afforded considerable deference," Blu-J, Inc. v. Kemper C.P.A Group, 916 F.2d 637, 641 (11th Cir. 1990), and should be reversed only upon the finding that the trial court abused its discretion. Perry v. State Farm Fire & Casualty Co., 734 F.2d 1441, 1446 (11th Cir.1984), cert. denied, 469 U.S. 1108, 105 S.Ct. 784, 83 L.Ed.2d 778 (1985). It does not appear to this Court that the bankruptcy court abused its discretion in finding that the letter, which threatened the filing of a law suit, was an attempt by CLC Inc. to resolve the dispute regarding its claim to full payment and was excludable under Fed.R.Evid. 408.
Even assuming arguendo that the bankruptcy court erred in excluding the letter and the attachment from evidence, such exclusion does not rise to the level of prejudicial error and would not materially affect today's decision of this Court on the merits of the substantive issues in this case.
C. AN AWARD OF SANCTIONS AND ATTORNEYS' FEES UNDER BANKRUPTCY RULE 9011
Pursuant to Bankruptcy Rule 9011 and the court's inherent powers, CLC Ltd. filed a motion for an award of attorneys' fees in the minimum amount of $80,803.50 as part of the sanctions it sought against SE Banken. The basis for this motion was SE Banken's objections to CLC Ltd.'s proof of claim, which, CLC Ltd. claims, were not well grounded in fact or law, or were filed for an improper purpose. Following a hearing on CLC Ltd.'s motion, the bankruptcy court entered on January 13, 1994 the Order Denying C.L.C. Marine Services, Ltd.'s Motion for Attorney's Fees. CLC Ltd. appeals.
The trial court's denial of Rule 9011 sanctions is reviewed for an abuse of discretion. See In re Grantham Brothers, 922 F.2d 1438, 1441 (9th Cir.1991); Lawrence Nat'l Bank v. Edmonds, 924 F.2d 176, 181 (10th Cir.1991). A trial court abuses its discretion where its ruling is based "on an erroneous view of the law or on a clearly erroneous assessment of the evidence." Cooter & Gell v. Hartmarx Corporation, 496 U.S. 384, 405, 110 S.Ct. 2447, 2461, 110 L.Ed.2d 359 (1990). Based upon a review of the record, including the transcript of the hearing on CLC Ltd.'s motion for attorneys' fees, the Court finds that the bankruptcy court did not abuse its discretion in declining to award sanctions and/or attorneys' fees under Bankruptcy Rule 9011.
Bankruptcy Rule 9011 requires that every paper filed in a bankruptcy case be signed by *1014 at least one attorney and that said signature constitutes a certificate that, among other things,
to the best of the attorney's . . . knowledge, information, and belief formed after reasonable inquiry it [the filed document] is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law; and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation or administration of the case.
Fed.R.Bankr.P. 9011. The rule provides for the imposition of an appropriate sanction, including attorneys' fees, in the event the Rule is violated:
If a document is signed in violation of this rule, the court on motion or on its own initiative, shall impose on the person who signed it, the represented party, or both, an appropriate sanction, which may include an order to pay to the other party or parties the amount of the reasonable expenses incurred because of the filing of the document, including a reasonable attorney's fee.
Id.
The question of whether a party has violated Bankruptcy Rule 9011 is left to the sound discretion of the trial judge. See In re Brown, 152 B.R. 563, 567 (Bankr. E.D.Ark.1993). Once the court determines that Rule 9011 has been violated, the imposition of sanctions is mandatory. See In re Zaragosa Properties, Inc., 156 B.R. 310, 313 (Bankr.M.D.Fla.1993) ("If the Rule is violated, there is no question that the imposition of sanctions is mandated by Rule 9011"); In re McAllister, 123 B.R. 393, 395 (Bankr.D.Or. 1991) (once the court determines that Rule 9011 has been violated, "sanctions must be imposed"). The bankruptcy court, however, has wide discretion in determining the appropriate sanction for a Rule 9011 violation. Brown, 152 B.R. at 567; McAllister, 123 B.R. at 395.
On appeal, CLC Ltd. argues that because the bankruptcy court in this case accepted as true all of the arguments of its counsel at the hearing on its motion, the court had found that SE Banken had violated Rule 9011 and thus, had no choice but to impose sanctions against SE Banken under Rule 9011. Counsel had argued to the bankruptcy court that SE Banken failed to conduct an adequate pre-filing inquiry, that SE Banken's position regarding whether privity did or did not exist between CLC Inc. and CLC Ltd. changed during trial, and that SE Banken made blanket objections to every claim filed against it. This conduct, CLC Ltd.'s counsel argued, demonstrates that SE Banken's objections lacked legal and factual basis, in violation of Bankruptcy Rule 9011.
CLC Ltd.'s appellate argument is based on a single statement made by the bankruptcy court at the conclusion of oral argument on CLC Ltd.'s motion for attorneys' fees. The court stated that "I'm going [sic] accept the proffer that there was all of the things that you've [CLC Ltd.'s counsel] alleged." See Attorneys' Fee Hearing Tr. at 43. It, however, immediately continued as follows:
Even having said that, I think what I need to do is look at this particular case and the conduct of the counsel in this particular case and the clients, the positions the parties took in this particular case. And having seen that, reviewed the file, been intimately involved in the case, I will deny the motion for sanctions.
Id. It is clear to this Court that the bankruptcy court did not, as CLC Ltd. contends, find that SE Banken had violated Rule 9011 in this case. Rather, it appears that the court effectively found that SE Banken had not violated that rule, a decision that was well within the trial court's discretion. There is no evidence in the record that the bankruptcy court's holding constituted an abuse of discretion and accordingly, the denial of Rule 9011 sanctions against SE Banken, including an award of attorneys' fees, should be affirmed.
Conclusion
Based upon the foregoing, the Court finds that CLC Inc. and CLC Ltd. obtained valid *1015 maritime liens against the M/V Song by virtue of the necessaries they provided to the Vessel, and that neither waived in any manner their right to the maritime liens under Article 28 of the Refit Contract. Accordingly, the Court hereby AFFIRMS the United States Bankruptcy Court for the Southern District of Florida's judgment of a maritime lien in favor of CLC Ltd. in the amount of $517,940.54 and the judgment of a maritime lien in favor of CLC. Inc. in the amount of $102,283.00.
Thus, the Bankruptcy Court's (i) Findings of Fact and Conclusions of Law on Objections to Maritime Lien Claim of C.L.C. Marine Services, Ltd., entered on November 12, 1993; (ii) Findings of Fact and Conclusions of Law on Objections to Maritime Lien Claim of C.L.C. Marine Services, Inc., entered on December 14, 1993; and (iii) Order Denying C.L.C. Marine Services, Ltd.'s Motion for Attorneys' Fees, entered on January 13, 1994 are hereby AFFIRMED.
DONE AND ORDERED.
NOTES
[1] There are outstanding before the Court three additional appeals in the bankruptcy case of SeaEscape Cruises, Ltd.: Skandinaviska-Enskilda Banken v. C.L.C. Marine Services, Ltd., Case No. 94-0413-CIV-ARONOVITZ; Skandinaviska-Enskilda Banken v. C.L.C. Marine Services, Inc., Case No. 94-1383-CIV-ARONOVITZ; and Maduro Travel, Inc. v. Skandinaviska-Enskilda Banken, et al., Case No. 94-0145-CIV-ARONOVITZ.
Case No. 94-0413-CIV-ARONOVITZ originally was consolidated with the cases at bar. The merits of that appeal, however, were not argued by counsel during the appellate hearing on September 9, 1994 and no decision on the merits thereof has been rendered by this Court. Thus, this opinion addresses only the merits of the three above-captioned appeals and does not pertain to Case No. 94-0413-CIV-ARONOVITZ. Case No. 94-0413-CIV-ARONOVITZ, however, may be related to Case No. 94-1383-CIV-ARONOVITZ, and the Court will undertake to see if consolidation can occur with respect thereto. The third remaining appeal, Case No. 94-0145-CIV-ARONOVITZ, does not appear to be related to the aforementioned appeals and is currently scheduled for oral argument on the merits before this Court on November 3, 1994.
[2] CLC Inc. and CLC Ltd. were both wholly-owned subsidiaries of CLC Group Limited.
[3] The state court action was styled CLC Marine Services, Inc. v. SeaEscape Ltd., d/b/a SeaEscape Cruises, Ltd. and SeaEscape, Ltd., Case No. 91-10209 in the Circuit Court for the Eleventh Judicial Circuit in and for Dade County, Florida.
[4] Rule 52 of the Federal Rules of Civil Procedure is made applicable to bankruptcy proceedings by Bankruptcy Rule 7052.
[5] Specifically, the trial court ruled that:
Upon review of this Court of the language of Article 28, the Court finds that the plain reading of Article 28 of the Refit Contract deals strictly with CLC MARINE SERVICES, INC.'s right to enforce its maritime lien rights as opposed to its right to or entitlement to a maritime lien. The Court further finds that Article 28 does not evidence a waiver or release by CLC MARINE SERVICES, INC. of its maritime lien encumbering the M/V SCANDINAVIAN SONG. Rather, Article 28 merely establishes or creates a condition precedent to CLC MARINE SERVICES, INC.'s ability to enforce its maritime lien, namely, it must first obtain an in personam judgment within thirty one (31) days.
Bankruptcy Court's December 14, 1993 Decision at 11.
[6] It should be noted that CLC Inc., and not CLC Ltd., was the contracting party to the Refit Contract. Nonetheless, SE Banken argues that CLC Ltd. is bound by that contract under the theories of imputed knowledge, privity and/or agency. Because the Court finds that CLC Inc. did not absolutely waive its right to a maritime lien under Article 28 of the Refit Contract, see infra, SE Banken's argument of an alleged waiver by CLC Ltd. based on the actions and knowledge of CLC Inc. is moot and need not be addressed herein.
[7] The Court of Appeals for the Eleventh Circuit in Bonner v. City of Prichard, 661 F.2d 1206, 1207 (11th Cir.1981), adopted as precedent all decisions of the former Fifth Circuit rendered prior to October 1, 1981.
[8] See, e.g., Farrell Ocean Services, Inc. v. United States, 681 F.2d 91, 93 (1st Cir.1982) (district court's finding that appellant had waived its lien is reversible only if clearly erroneous); Bermuda Express, N.V. v. M/V Litsa, 872 F.2d 554, 562, n. 7 (3d Cir.) (same), cert. denied sub nom., M/V Litsa v. Southeastern Maritime Co., 493 U.S. 819, 110 S.Ct. 73, 107 L.Ed.2d 40 (1989).
[9] SE Banken has a second arrow in its bow as to CLC Ltd. It argues that CLC Ltd., as a subcontractor, waived its maritime lien under Article 20(b) of the Refit Contract, which provides that the "Contractor" (i.e., CLC Inc.) "shall require each subcontractor and each other supplier of materials and tools to irrevocably waive in writing any claim or lien" against the M/V Song. There, however, is absolutely no evidence in the record that CLC Ltd. signed such a written waiver.
[10] As an aside, there are two other documents upon which a waiver may possibly be based: (1) the bareboat charter agreement and (2) the Letter of Intent between CLC Inc. and SeaEscape. Neither supports a finding of a waiver.
Paragraph 14 of the bareboat charter agreement clearly prohibits the attachment of any lien on the M/V Song. Neither CLC Inc. nor CLC Ltd. was a party to the charter agreement and the evidence showed that neither had knowledge of the agreement prior to the time of its performance. The charter agreement therefore cannot be the basis of a waiver.
CLC Inc. was a party to the Letter of Intent, paragraph 9 of which clearly provides for a waiver of a lien. The Letter of Intent, however, also contemplated that "[a] formal contract incorporating these terms will be signed" by a specified date. The general rule in Florida is that where parties intend a negotiation to be reduced to a formal writing, there is no binding contract until the formal writing is achieved. Housing Authority of City of Fort Pierce v. Foster, 237 So.2d 569 (Fla. 4th DCA 1970). This rule applies only where the parties do not intend to be bound by the negotiations until the formal contract is executed. Id. However, if the parties so intend, a contract is binding from the time it is made even though the parties also agree that the formal embodiment of its provisions will subsequently be prepared. See Eastern Air Lines, Inc. v. Mobil Oil Corp., 564 F.Supp. 1131, 1145 (S.D.Fla. 1983), affirmed, 735 F.2d 1379 (11th Cir.1989).
The trial court made no specific findings of fact with regard to whether the parties intended to be bound by the Letter of Intent. However, the testimony of CLC Inc.'s and SeaEscape's witnesses establish that the Letter of Intent was merely an agreement to agree, that CLC Inc. repeatedly objected to the waiver language in paragraph 9, and that the parties had agreed to change said language in the subsequent document to reflect the parties' understanding that there would be no waiver. This constitutes significant evidence that the parties did not intend to be bound by paragraph 9 of the Letter of Intent. In addition, the explicit waiver language in paragraph 9 of the Letter of Intent does not appear in the Refit Contract, which is indicative of the parties' subsequent understanding. Moreover, the Letter of Intent was superseded by the Refit Contract pursuant to the standard merger/integration clause in Article 27 of the Refit Contract. Thus, based upon the evidence, it does not appear that the Letter of Intent can be the basis of a waiver.
[11] Rule 408 provides, in pertinent part, that:
Evidence of (1) furnishing or offering or promising to furnish, or (2) accepting or offering or promising to accept, a valuable consideration in compromising or attempting to compromise a claim which was disputed as to either validity or amount, is not admissible to prove liability for or invalidity of the claim or its amount. Evidence of conduct or statements made in compromise negotiations is likewise not admissible.
Fed.R.Evid. 408. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2156944/ | 613 F. Supp. 1549 (1985)
LAC D'AMIANTE DU QUEBEC, LTEE., a corporation of the State of Delaware, Plaintiff,
v.
AMERICAN HOME ASSURANCE CO., a corporation of the State of New York, and Highlands Insurance Company, a corporation of the State of Texas, and Midland Insurance Company, a corporation of the State of New York, Defendants.
Civ. A. No. 83-2108.
United States District Court, D. New Jersey.
July 31, 1985.
*1550 Porzio, Bromberg & Newman, P.C. by Myron J. Bromberg, Morristown, N.J., Covington & Burling by Robert N. Sayler, John G. Buchanan III, Washington, D.C., for plaintiff.
De Gonge, Garrity & Fitzpatrick, P.C. by Francis X. Garrity, Bloomfield, N.J., for defendant American Home Assur. Co.
Durand, Gorman, Heher, Imbriaco & Lynes by Jerome M. Lynes, Newark, N.J., for Highlands Ins. Co.
Suarez & Suarez by Michael Suarez, Jersey City, N.J., for defendant Midland Ins. Co.
OPINION
BARRY, District Judge.
Thousands upon thousands of claims arising out of asbestos related diseases which have become manifest are currently pending in federal and state courts with new filings increasing dramatically. Total liability projections between the years 1980 and 2015 range from $7.6 billion to $87.1 billion[1] with aggregate judgments and settlements *1551 over the next thirty years expected to reach $38 billion and the costs of defending such suits over the same time period estimated conservatively at $25 to $30 billion.[2] Indeed, the claims currently pending represent only a small percentage of the total number of potential claimants.
The vast number of cases, and the concomitant potential for tort liability of staggering proportions, has spawned yet additional litigation seeking to determine whether and when asbestos manufacturers or sellers or their insurers must ultimately bear the costs of defending these suits and compensating asbestos victims. At least five United States Courts of Appeals and numerous district courts have considered the issue of asbestos insurer liability. While all have held for the insureds, most commonly in declaratory judgment actions seeking to clarify the parties' rights and obligations under Comprehensive General Liability (CGL) policies, the courts have offered conflicting interpretations of the manner in which virtually identical policies allocate liability between successive insurers and between insurers and insureds.
In part, these differing interpretations are a result of the insidious progression of asbestos related diseases over many years which renders the concept of "injury" so difficult to define. Clearly, "injury" might refer to the tissue damage which is the immediate result of the initial exposure to or inhalation of asbestos fibers. It might as well describe the continuing presence of these fibers in the body even though exposure and inhalation may have ceased and even though disease cannot yet be detected. Or perhaps "injury" is simply the outward manifestation of an asbestos related disease. Difficulty in determining which occurrence or set of occurrences during the lengthy developmental process constitutes the injury leads to different conclusions as to the specific coverage period (or period in which the asbestos producer is uninsured) to which that injury or disease should be assigned.
The differing interpretations are also due, in part, to the desire of some courts to maximize coverage even when to do so requires judicial sleight of hand. One should not dwell too long, however, on the apparent inequity inherent in this result-oriented approach. Given the considerable potential liability for asbestos claims and the insurance industry's refusal either to afford coverage altogether or to make such coverage affordable, such an approach is at least understandable.
The issues before those courts and now before this court have been described as "difficult" by one, "impossible" by another, and, in Judge Troutman's words, issues which "will perplex both district and circuit courts until they are resolved by the ultimate appellate authority." ACandS, Inc. v. Aetna Casualty and Surety Co., 576 F. Supp. 936, 943 (E.D.Pa.1983).[3] Meanwhile, we press on, here prodded by a plaintiff against whom over 4500 claims alleging injury due to direct exposure to asbestos had been filed by the end of 1983, at which time its liability for personal injury settlements totalled nearly $4,500,000 and the costs of defending such claims exceeded $11,000,000. Six claims for property damage, a new area of asbestos litigation, had also been filed by that point, with more than $163,000 in costs of defense attributable to those claims.
I
Plaintiff Lac d'Amiante du Quebec, Ltee. ("LAQ"), a Delaware corporation with its principal place of business in Quebec, Canada, and a wholly owned subsidiary of the American Smelting and Refining Co. (ASARCO), has been engaged since 1958 in the business of mining and selling asbestos which is thereafter used by other companies as a component or constituent of various *1552 products manufactured for their use or for sale to third parties. Until February 1, 1962, LAQ was insured by the Employers Liability Insurance Corporation of Canada for an annual aggregate of $50,000. From February 1, 1962 until November 21, 1972, LAQ's coverage, in the same amount, was continued by Canadian General Insurance Company. From November 21, 1972 until February 1, 1974, LAQ increased its coverage with Canadian General to $100,000 annually and, from February 1, 1974 to February 15, 1976, increased this coverage to $300,000.[4] Neither the Employers Liability Insurance Corporation of Canada nor the Canadian General Insurance Company are named as defendants in this action, and LAQ seeks protection only under its liability insurance coverage extending from 1975 to 1984.
At issue here are ten policies underwritten by defendant American Home Assurance Co., four policies issued by defendant Midland Insurance Co., and one policy issued by defendant Highland Insurance Co.[5] On March 15, 1975 and continuing until March 15, 1984, LAQ was covered by an excess indemnity or "umbrella" liability policy issued by defendant American Home Assurance Co. in an annual aggregate amount of $3,000,000 with the sole exception being the policy period of 1976-77, when LAQ's umbrella coverage from American Home was $4,000,000, coverage excess to a $1,000,000 self-insured retention. From March 15, 1977 to March 15, 1982, the American Home policies were written in excess of a $2,500,000 self-insured retention and from March 15, 1982 through March 15, 1984, the American Home policies were issued in excess of a $3,000,000 self-insured retention.
On March 15, 1975, LAQ obtained coverage in the amount of $20,000,000 in excess of American Home's umbrella coverage from defendant Highlands Insurance Co. When Highlands left the risk a month and a half later on April 29, 1975, LAQ obtained virtually the same coverage supplied by Highlands from defendant Midland Insurance Co. from April 1975 until March 15, 1976 and then until March 15, 1977. During the policy term 1976-1977, LAQ obtained an additional $10,000,000 excess coverage from Midland. From March 15, 1977 to March 15, 1978, Midland's coverage was $5,000,000 over the primary umbrella policy issued by American Home and a $2,500,000 self-insured retention.
Thus, from 1958 to 1972, LAQ maintained an aggregate of $50,000 in products liability insurance annually, increasing to $100,000 in 1972, to $300,000 in 1974, to $23,000,000 in 1975,[6] and to $34,000,000 in 1976. Nine of the American Home policies are umbrella policies, and the Highlands policy, the Midland policies, and the remaining American Home policy are form following excess policies, with coverage above that of the American Home umbrella policies for the period March 15, 1975 through March 15, 1978.
The policies that defendants issued to plaintiff are identical in all relevant respects, and the parties have stipulated that the operative provisions are the same. It also has been stipulated that each form following policy incorporates and follows the operative terms and conditions of the umbrella policy that underlies it, that each excess policy is wholly governed by the underlying umbrella policy, and that the operative coverage provisions in the American Home umbrella policies do not differ in any significant respect from those in the standard Comprehensive General Liability policies widely used in the insurance industry.
*1553 Thus, under the "Coverage" provision of a representative umbrella policy, the insurer undertakes:
[t]o pay on behalf of the Insured that portion of the ultimate net loss in excess of the retained limit as hereinafter defined, which the Insured shall become legally obligated to pay as damages for liability imposed upon the Insured by law, or liability assumed by the Insured under contract because of (i) personal injury, [or] (ii) property damage, ... as defined herein caused by an occurrence.
The term "occurrence" is defined as:
an event, including continuous or repeated exposure to conditions, which result in Personal Injury or Property Damage during the policy period....
"Personal injury" is defined as:
bodily injury, sickness, disease, including death anytime resulting therefrom ... which occurs during the policy period.
"Property damage" includes:
physical injury to or destruction of tangible property, which occurs during the policy period, including loss of use thereof at any time resulting therefrom....
"Ultimate net loss" is defined as:
the total sum which the Insured ... become[s] obligated to pay by reason of personal injury [or] property damage ... claims, either through adjudication or compromise, and shall also include ... all sums paid or payable ... for ... defense of claims....
Under the "Defense, Settlement, Supplementary Payments" provision the insurer undertakes to:
defend any suit against the Insured alleging liability insured under the provisions of this policy and seeking recovery for damages on account thereof even if such suit is groundless, false or fraudulent....
II
In cross-motions for summary judgment based on the policy language and their respective theories of coverage, the parties seek resolution by the court of various issues regarding the application of the insurance policies issued by the defendants to asbestos related personal injury claims and asbestos related property damage claims. Stated broadly, the question for resolution is who bears the risk and how far does that risk extend? More specifically, the following issues are posed:
1. The trigger of indemnity coverage: Under a liability insurance policy, is coverage for an asbestos-related settlement or judgment triggered only if exposure to or installation of asbestos occurred during the policy period, or is such coverage triggered if any part of the continuing personal injury or property damage occurred during the policy period?
2. The extent of indemnity coverage: Once the coverage of a policy for an asbestos-related settlement or judgment is triggered pursuant to paragraph 1, is the insurer liable for only a prorated portion of the amount of the settlement or judgment, or is it jointly and severally liable for the total amount of the settlement or judgment without proration to the insured (subject to contribution by other insurers)?
3. The trigger of defense coverage: Under a liability insurance policy, is coverage for the costs of defending an asbestos-related claim triggered only if the alleged exposure to or installation of asbestos potentially falls within the policy period, or is such coverage triggered if any part of the alleged continuing personal injury or property damage potentially falls within the policy period?
4. The extent of defense coverage: Once the coverage of a policy for the costs of defending an asbestos-related claim is triggered pursuant to paragraph 3, is the insurer liable only for a prorated portion of the defense costs, or is it jointly and severally liable for the total amount of such costs without proration to the insured (subject to contribution by other insurers)?[7]
The parties have stipulated to all facts material to this court's decision, and no *1554 party seeks to submit any evidence extrinsic to the policies not heretofore submitted for assistance in gleaning the parties' intent. Thus, the parties and the court agree that the issues presented are ripe for summary disposition. Similarly, the parties and the court agree that to the extent that plaintiff seeks a declaration of its rights and obligations, a justiciable case or controversy is presented. Plaintiff has been and continues to be sued for injuries that are alleged to have resulted from its asbestos products. For each of these suits the rights and obligations of plaintiff and its various insurers must be determined. Interpretation of the insurance policies at issue presents a "real and substantial controversy admitting of specific relief through a decree of a conclusive character" of this court. Aetna Life Insurance Co. v. Haworth, 300 U.S. 227, 240-41, 57 S. Ct. 461, 463-64, 81 L. Ed. 617 (1937).
Finally, both the court and the parties agree that New Jersey law should be applied. In a diversity case such as this, the court must apply the conflict of law rules of the state in which it sits. Klaxon Co. v. Stentor Electric Manufacturing Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 1021, 85 L. Ed. 1477 (1941). New Jersey courts generally apply the law of the place in which an insurance contract was executed to determine the rights of the parties under that contract unless an analysis of significant competing interests compels a different result. State Farm Mutual Automobile Insurance Co. v. Simmons' Estate, 84 N.J. 28, 37, 417 A.2d 488 (1980). In the instant case, it appears that the bulk of the activities covered by the policies took place in New Jersey and that the majority of claims filed against LAQ have been filed in New Jersey. Further, the basic principles governing the interpretation of insurance policies of the interested states in this multi-state action do not conflict in any material way. Accordingly, this court sees no reason to disturb the parties' choice of New Jersey law as controlling this matter, although it will seek to be consistent with the laws of the other interested states.[8]
III
The personal injury claims against LAQ, like those against any asbestos company, allege that after a period of exposure to asbestos, a plaintiff suffers from one or more asbestos-related conditions, ranging from mesothelioma and other forms of cancer, to asbestosis, to the less disabling conditions known as pleural plaques and pleural thickening.[9] The property damage *1555 claims, more fully addressed later, allege, among other things, harm to buildings and other property due to the continuing presence of asbestos products in the buildings.
The feature common to all of these claims is that the alleged harm does not become manifest until years, and often decades, after a plaintiff's initial exposure to asbestos or, with reference to property damage, until years or decades after the original installation of asbestos-containing materials. These claims are, therefore, often referred to as "delayed manifestation claims". The other feature present in virtually all claims is what has become known as a "harmful residence" period the period of time between the last exposure to asbestos and the discovery of disease in the personal injury cases or between the last act of installation and the discovery of damage in the property damage cases. Thus, as noted by the Borel court and as stipulated by these parties in the personal injury context, inhalation of asbestos can produce asbestosis. After the initial inhalation and the lodging of asbestos fibers in the lung, slowly progressive tissue reaction occurs over a long period of time during which the disease is latent. Finally the disease, whether asbestosis or a less disabling condition or mesothelioma or another form of cancer, manifests itself.
Plaintiff and defendants urge that the policies at issue here be interpreted differently. They press upon the court two of the three divergent legal theories which have been adopted by the Courts of Appeals in interpreting virtually identical policies and defining the operative event for determining what is an asbestos-related "injury" and when that injury occurs.
In Insurance Company of North America v. Forty-Eight Insulations, Inc., 633 F.2d 1212, 1222 (6th Cir.1980), clarified 657 F.2d 814, cert. denied 454 U.S. 1109, 102 S. Ct. 686, 70 L. Ed. 2d 650 (1981), the Sixth Circuit held that the obligations imposed upon an insurance company by the CGL policy issued to asbestos producers is triggered by a claim that an asbestos victim was exposed to the insured's asbestos containing products during the policy period. Each insurer in Forty Eight was liable for its pro rata share of the damages, based upon the length of time it was on the risk in relation to the total period of harmful exposure. See also Porter v. American Optical Corp., 641 F.2d 1128 (5th Cir.) cert. denied 454 U.S. 1109, 102 S. Ct. 686, 70 L. Ed. 2d 650 (1981).
Defendants urge this court to accept the exposure theory[10], arguing that it is only bodily injury from the inhalation of asbestos during the policy period that triggers coverage. Bodily injury, it has been stipulated, includes subclinical insult to lung tissue which can result shortly after inhalation. There is no trigger of coverage, defendants continue, if their policies were in effect only during the latency or "harmful residence" period or at the time of manifestation of the disease because the disease process during latency and the manifestation of the disease are not distinct bodily injuries but, rather, are simply outgrowths of the initial injury caused by the inhalation of asbestos. Neither, they argue, is there any trigger of coverage if the entire inhalation of asbestos predated the policy periods.
It is not surprising that defendants argue the exposure theory given plaintiff's candid admission that those injuries that began long before the purchase of defendants' policies are the very ones that may be expected to produce most of the claims against plaintiff. "The great bulk of the *1556 claims against LAQ would thus fall outside the defendants' responsibility unless their policies were triggered by the process of injury that continues after the period of actual exposure. Otherwise stated, if the policies were construed in accordance with the defendants' exposure-only theory, their fundamental function of protection would become an illusion." Pl.Br. at 22.
Plaintiffs, therefore, urge the "continuous trigger" theory adopted by the District of Columbia Circuit in Keene Corp. v. Insurance Co. of North America, 667 F.2d 1034 (D.C.Cir.1981), cert. denied 455 U.S. 1007, 102 S. Ct. 1644, 71 L. Ed. 2d 875 (1982). Under that theory, coverage is triggered by a claim that a victim was either exposed to asbestos products, suffered exposure in residence, or manifested an asbestos-related disease during the policy period.[11] Because the policies' "trigger"the occurrence of injuryis a continuing process beginning with the inhalation of asbestos fibers and ending years later with the manifestation of an asbestos-related disease, any insurer whose policy was in effect at any point in this process would be, under this theory, jointly and severally liable for the whole of this single injury with the insurers to determine amounts of contribution among themselves. The Keene rationale, in emphasizing the language of the policies and the expectations that the insured, as an objective matter, could reasonably have formed, clearly seeks to ascertain and effectuate the intent of the parties in light of the policies' purpose of indemnity.
Plaintiff argues that each liability policy in effect at any time during the entire course of alleged asbestos-related personal injury or property damage from the first exposure or installation through the last manifested development of asbestos-related harm provides full coverage for the claims alleging such harm, subject only to the dollar limits stated in the policy. Defendant Highlands, which was on the risk for merely six weeks, and the other defendants would, under Keene and plaintiff's theory, be responsible up to their policy limits for all the years of plaintiff's mining operations which predate the terms of those policies, responsible for claims that may well extend into the 21st century, and responsible in a hypothetical case when the "insured" gambled by carrying no insurance or, as here, minimal insurance, rendering the phrase "policy period" a meaningless term. See Brinco Mining Ltd. v. Federal Insurance Co., 552 F. Supp. 1233, 1236-37 (D.D.C.1982).
The third theory, which is urged by none of the parties in this case, is the "manifestation" theory accepted by the First Circuit, under which coverage is triggered only by a claim that an asbestos disease has actually manifested itself during the policy period. Eagle-Picher Industries, Inc. v. Liberty Mutual Insurance Co., 682 F.2d 12 (1st Cir.1982), cert. denied 460 U.S. 1028-29, 103 S. Ct. 1279-81, 75 L. Ed. 2d 500 (1983).
In sum, in deciding the critical issue of when bodily injury occurred for purposes of triggering coverage, the exposure theorists argue that bodily injury and the consequent triggering of coverage occurs shortly after the initial inhalation of asbestos and worsens as exposure continues; the continuing injury theorists argue that bodily injury is any part of the injurious process beginning with the initial exposure and ending with manifestation of the disease; and the manifestation theorists argue that bodily injury occurs when the disease actually manifests itself.
IV
It bears repeating that before this court for interpretation are standardized policies containing policy language virtually identical to that which was before the various courts which have reached differing interpretations *1557 while relying on the same basic principles of contract construction and insurance law, i.e. that the policy was to be construed against the insurer, ambiguities were to be resolved in favor of the insured, and clear and unambiguous terms were to be given their plain and commonplace meaning.[12]
The reason for this seemingly anomalous result is that each court considered the case of a different asbestos company which had purchased liability insurance at a different stage in its asbestos product-line development. Each of the courts, however, subjected the policies to an interpretation designed to "promote coverage" and to fulfill the "dominant purpose of [providing indemnification]." In a word, each court sought to "maximize coverage" for the insured. (citations and footnote omitted).
ACandS, Inc. v. Aetna, 576 F.Supp. at 940.
As one commentator has observed, "The real question the courts have answered is not whether one theory is correct as a matter of law, but whether it is most favorable to the insured in light of when in its manufacturing stage it obtained liability insurance. In this regard, `exposure' and `manifestation' may not be legal theories at all, but merely labels for the desired result of maximizing insurance coverage." Note, 97 Emory L.J. at 929-30. The medical evidence in Forty Eight and Eagle-Picher supported those results with the Forty Eight court noting that bodily injury, in the form of lung tissue damage, occurred at or substantially contemporaneously with the initial inhalation and continued progressively thereafter, and the Eagle-Picher court noting that the medical evidence demonstrated that exposure to asbestos fibers and injury did not occur at those times.
Here, for example, as in Eagle-Picher, acceptance of the exposure theory would almost totally deprive plaintiff of coverage, at least by these defendants. In Keene, however, acceptance of only the manifestation theory as the trigger of coverage would have required the insurance companies to bear only a fraction of the Keene Corporation's total liability for asbestos-related diseases. It is not difficult to posit another case in which the Keene Corporation's forthright effort to maximize coverage would be deemed to be unjust because, given the absolute monetary limits of insurance policies, claims that would have been wholly covered under a narrow interpretation of the policy language would be covered only in part or not at all were the policy limits exhausted in satisfying claims under a broader construction of the policy language than was mandated. Thus, where relevant terms in virtually identical policies are found to be ambiguous, as they almost always have been,[13] ambiguities, such as the failure to define the method by which coverage is triggered, are, in accordance with applicable law, construed in favor of the insured.
As noted earlier, the operative policy provisions at issue here are by stipulation deemed to be the same as the provisions considered by those courts which have reached these varying results and by stipulation conceded to be "susceptible to more than one interpretation". As applied in the insidious disease context, these provisions are ambiguous in that they fail to articulate with any precision a point in the lengthy development of an insidious disease at which coverage is triggered.[14] More precisely, while the language of the policies indicates no intention to exclude from coverage diseases with long gestation periods, neither does that language state whether it is exposure, exposure in residence, manifestation or all three which trigger *1558 coverage. Consequently, this court must interpret the language of the policies and consider, where appropriate, contract principles, medical evidence, insurance law, and public policy ramifications in reaching a decision as to which insurer or insurers are potential indemnitors of the insured, with the trigger of coverage turning on the meaning of the phrase "bodily injury".
Given the stipulated and otherwise undisputed relevant facts in this action, most particularly the proposition that bodily or "personal injury" in the policies includes any pathological changes to the human organism, including internal, non-observable tissue damage and includes subclinical insult to lung tissue which can result shortly after inhalation; given the basic principles of contract and insurance law which apply; and given the fact that no New Jersey court has yet to decide which operative event constitutes an asbestos-related injury,[15] this court predicts that were this case before the Supreme Court of New Jersey for decision, the Supreme Court would construe these ambiguous policies in favor of the insured and, following Keene, declare that exposure, exposure in residence, and manifestation each trigger coverage under the policies.[16]
Support for this conclusion is found in per curiam affirmances by both the Appellate Division and the Supreme Court of New Jersey "substantially for the reasons expressed" in the unpublished opinion of the trial judge which the Supreme Court set forth, in pertinent part, as its opinion. Hartford Accident & Indemnity Co. v. Aetna Life & Casualty Insurance Co., 98 N.J. 18, 483 A.2d 402 (1984). The case involved a claim on a liability policy for the amount paid in satisfaction of a judgment for failing to adequately warn of the dangers of the drug Atropisol, the ingestion of which was a proximate cause of a child's physical injuries. It did not involve questions of whether there was coverage or how best to maximize coverage; rather, the question presented was which of two policies covered the claim. Aetna's policy was in effect when the drug was dispensed and administered but no actual bodily injury manifested itself until eleven days after the Aetna policy had expired and after the time when Hartford had assumed coverage. Therefore, the court found, Aetna's policy provided no coverage for the injuries because the injuries suffered were not in the nature of a "bodily injury ... to which this insurance applies...." caused by an occurrence "including injurious exposure to conditions, which result, during the policy period, in bodily injury...."
Coverage turned on whether bodily injury had occurred prior to the expiration of Aetna's policy, but there was no evidence to that effect and no evidence to show that the harm from the administration of Atropisol *1559 was cumulative and progressive. Distinguishing Porter v. American Optical Corp. and Insurance Company of North America v. Forty-Eight Insulations, Inc., raised by Hartford in support of its exposure theory, the court observed that in those cases there was expert testimony that each inhalation of asbestos into the lungs caused bodily injury which is immediate and progressively more harmful. The existence of coverage, the court concluded, required a showing that the child actually suffered bodily injury on or before the date Aetna's policy expired, a conclusion supported by a solid line of authority in New Jersey.[17] Had there been such a showing, as here there has been by virtue of stipulation, it appears that the court would have had little difficulty in adopting the exposure theory which, as Judge Sarokin aptly observed in Sandoz, Inc. v. Employer's Liability Assurance Corp., 554 F. Supp. 257, 266 (D.N.J.1983), is more accurately labeled the "injury theory". And clearly, given the evidence of actual injury during the Hartford policy period and the emphasis on the failure to produce evidence of injury during the Aetna policy period, had the Keene theory been before the court it would most likely have been adopted, particularly had this been a case of maximizing coverage.
This court's determination that the Supreme Court of New Jersey would apply the Keene theory is supported, as well, when New Jersey's rules of construction of insurance contracts are applied. New Jersey law provides that insurance contracts are to be liberally construed in favor of the insured and against the insurer. Last v. West American Co., 139 N.J.Super. 456, 354 A.2d 364 (App.Div.1976). If there are ambiguities in the insurance contract, or uncertainty over its interpretation, the contract is to be construed against the insurer and in favor of the insured. Bryan Construction Co. v. Employer's Surplus Lines Insurance Co., 60 N.J. 375, 290 A.2d 138 (1972).[18] To construe the policies at issue in this case in favor of the insured requires the application of Keene. Moreover, as a general matter, Keene provides certainty of coverage unlike the exposure and manifestation theories in which coverage is triggered only at specified points in the injurious process. To the extent the Supreme Court would wish to provide certainty, it would follow Keene.
V
The parties reiterate their respective positions as to the trigger of coverage for bodily injury with reference to the trigger of coverage for property damage claims, a rapidly burgeoning area of prospective liability particularly in the school context.[19] These positions are reiterated presumably because, again, adoption of Keene would maximize plaintiff's coverage and adoption of the exposure theory would minimize plaintiff's coverage "in light of the fact that most installations may be *1560 expected to have occurred long before [AHAC's] coverage began". (Pl.Br. at 33).
Plaintiff argues that the continuing presence of asbestos products in a building causes continuing damage and, thus, that coverage should be triggered during the entire period from installation through removal or containment of the asbestos. The policies, it continues, do not confine property damage to any particular point in time or phase in a damage process that occurs over time and, because the harm continues during the entire period, the clear meaning of the policies mandates the triple trigger of coverage. If the meaning of the policies is deemed to be less than clear, plaintiff argues that general principles of insurance law would compel the same result.
Defendants once again argue the exposure theory albeit denominating the injury that asbestos products cause as having occurred at the installation of those products. Unlike bodily injury, they continue, an asbestos property damage claim has no latency period and the fact and time of damage, the determining factors in triggering coverage, can be established with precision as having occurred at installation with the passage of time having no effect on the intrinsic hazardous characteristics of asbestos. Mere continuation of the presence of asbestos in a building, they conclude, is a consequence of the installation and does not constitute new damage so as to trigger coverage any more than does containment or removal.
Under New Jersey law what has been described, in the asbestos context, as the manifestation theory would be applied in the usual property damage case. Thus, the trigger under CGL policies is held in New Jersey to be damage during the policy period and not a negligent act during the policy period that later caused damage. See, e.g., Middle Department Inspection Agency v. The Home Insurance Co., 154 N.J.Super. 49, 380 A.2d 1165 (App.Div.1977), cert. denied 76 N.J. 234, 386 A.2d 858 (1978) (negligent building inspection in 1970; fire in 1973 caused by faulty wiring; no damage in 1970 during policy period); Deodato v. Hartford Insurance Co., 143 N.J.Super. 396, 363 A.2d 361 (negligent construction of roof during policy period; trigger of liability was destruction of roof years later). Analogizing here, the injury triggering liability would be, for example, the ripping out of asbestos from walls unless it can be said that "injury" or damage actually occurred at some earlier point in time.
Similarly, the continuing injury concept is not novel in the non-asbestos context, and indemnity coverage of a series of liability policies for injuries which are no more divisible or obvious than those in asbestos property claims is regularly found to be joint and several. See, e.g., California Union Ins. Co. v. Landmark Ins. Co., 145 Cal. App. 3d 462, 193 Cal. Rptr. 461 (1983) (water seepage); Gruol Constr. Co. v. Insurance Co. of North America, 11 Wash. App. 632, 524 P.2d 427 (1974) (dry rot). And see Hartford Accident & Indem. Co. v. Aetna Life & Casualty Ins. Co., 98 N.J. 18, 483 A.2d 402 (1984).
Implicit in the theories they press is the parties' agreement that injury or damage occurs at the time of installation. The only question is whether the injury or damage was complete at installation with anything that followed merely flowing naturally from that injury, as defendants urge, or whether that installation was the initial step in a single continuous injurious process, as plaintiff urges. The question posed more simply is simply this: whether the damage is confined to a discrete act or whether damage is continuous. We thus return to where we began and ask again: "What is the injury that triggers coverage?"
There appear to be no decisions of any court to date that have addressed the issue of the trigger of coverage for asbestos related property claims and the parties have presented little beyond argument to this court. Separate and apart from the fact that it would be illogical and impractical to provide a triple trigger in bodily injury cases but only a single trigger in property damage cases, what is before the court strongly suggests that the Keene theory would be adopted by the Supreme *1561 Court of New Jersey in the property damage context as well.
It is true, as defendants suggest, that asbestos containing materials may degrade and release asbestos fibers into the air where they may be inhaled and cause bodily injury. It is not true, as defendants also suggest, that what is at issue here are two discrete points in time installation and repair or removal with all that is in between merely "continued presence" causing no new damage to the property itself. It is recognized that there is a natural deterioration of asbestos-containing materials resulting in the release of fibers, release that may occur by a slow continuous degradation of the insulating surface which may be accelerated by the air movement and vibration which occurs in most buildings. Guidelines for Assessment and Abatement of Asbestos-Containing Materials in Buildings, United States Department of Commerce, National Bureau of Standards, Center for Building Technology, May 1983, prepared for General Services Administration, Office of Design and Construction, Public Buildings Service, No. NBSIR 83-2688 at 233. More specifically, friable asbestos material breaks down as a result of vibrations, deterioration, or direct contact and damage and, as it ages, it can lose its cohesive strength. Fallout of fibers from deteriorating material is continuous. The Attorney General's Asbestos Liability Report to the Congress, United States Department of Justice, Land and Natural Resources Division, Sept. 21, 1981 at 46-47.[20]
As the court concluded in Town of Hooksett School District v. W.R. Grace & Co., 617 F. Supp. 126 (D.N.H.1984):
The asbestos was but a single ingredient of the acoustical insulation and fireproofing spray applied to the school. Yet, it managed to contaminate the remainder of the insulator, the curtain, walls and carpets of the school among other things. Such contamination constitutes a physical injury to Plaintiff's premises; where a defect in Defendant's product i.e., the asbestos creates a cognizable safety hazard, the resulting injury to property is as actionable in strict liability and negligence as personal injury resulting from the defect would be.
Id. at 131. Implicit if not explicit in this conclusion is the fact that the injury to property caused by asbestos is both continuous and progressive and certainly not complete upon the act of installation.[21]
Thus, while property damage is not, of course, an insidious disease, many of the same considerations apply. Those considerations lead to the conclusion that property damage in the asbestos context is as imprecise of definition as is "bodily injury", a term which the Third Circuit observed "simply lack[s] the precision necessary to identify a point when physical damage or debility occurred so as to determine adequately at what time coverage was triggered." ACandS v. Aetna, at 972.
VI
The issues as to the appropriate trigger of coverage for personal injury and property damage claims having been resolved, the remaining issues reach resolution swiftly.
First, it having been determined that coverage is triggered if any part of continuing personal injury or property damage occurred during the policy period, losses among the respective policies must be allocated when coverage under more than one policy has been triggered in a particular case. As the parties phrase the *1562 question, is the insurer liable for only a prorated portion of the amount of the settlement or judgment or is it jointly and severally liable for the total amount without proration to the insured, but subject to contribution by other insurers?
The umbrella policies provide that payment on behalf of the insured shall be "the total sum which the Insured ... become[s] obligated to pay by reason of personal injury [or] property damage ... claims." The plain language of these policies requires that each triggered policy shall respond in full. The Third Circuit, construing near-identical language to reach an identical result, determined that the district court did not err in deciding that, subject to the possible effect of "other insurance" clauses, there is no proration of losses under a policy once coverage is triggered. ACandS v. Aetna, at 974:
The policies require the insurers to pay all sums which AC and S becomes `legally obligated to pay' because of bodily injury during the policy period. It is uncontested that under principles of tort law AC and S may be held fully liable for a personal injury plaintiff's damages caused in part by AC and S' asbestos during a particular period, even though plaintiff's damages may have been caused, in part, at other times.... It follows that if a plaintiff's damages are caused in part during an insured period, it is irrelevant to AC and S' legal obligations and, therefore, to the insurer's liability that they were also caused, in part, during another period. See Keene, 667 F.2d at 1047-49. We think the Supreme Court of Pennsylvania would agree.[22] (citation omitted)
Id. at 974.
For reasons even beyond the plain language of the policies, this court believes that the Supreme Court of New Jersey would agree as well. First, as the Keene court reasoned in going beyond its holding that under the plain language rule full payment of the insured's loss, without proration, was required, any proration of liability as against the insured would contravene the policies' dominant purpose of protection:
The policies that were issued to [the insured] relieved [it] of the risk of liability for latent injury of which [it] could not be aware when it purchased insurance. [The insured] did not expect, nor should it have have expected, that its security was undermined by the existence of prior periods in which it was uninsured, and in which no known or knowable injury occurred. If, however, an insurer were obligated to pay only a pro-rata share of [the insured's] liability, as the district court held, those reasonable expectations would be violated.
667 F.2d at 1047-48.
There was nothing in the Keene policies, as there is nothing here, that provides for a reduction in liability if an injury occurs only in part during a policy period.
Moreover, plaintiff points to the pernicious effect that proration would have in this case. All the AHAC umbrella policies have substantial deductibles, reaching as high as $3,000,000. Prorating each claim over many policy periods merely prorates it over many years of deductibles and, plaintiff argues, with only a miniscule portion of each claim counting toward the exhaustion of the retained limit in each period, defendants' policies would effectively remain insulated from loss. Plaintiff, in other words, would be "place[d] ... in the role of a modern-day Tantalus, with an insurance program dangling forever out of its reach." (Pl.Br. at 26) This, I predict, the Supreme Court of New Jersey would not permit.
Finally, given the fact of the indivisible nature of an asbestos-related injury it is, the parties have agreed, "impossible, as a practical matter, to determine which exposure or exposures to asbestos dust caused the disease," and "[t]here exist at present no medical techniques capable of specifically *1563 identifying and quantifying the portion of asbestos-related injury, sickness or disease actually sustained in each year from and after a first inhalation of asbestos." Cf. Sandoz, 554 F.Supp. at 266. One wonders if proration, even if desirable, would be possible.
For all of these reasons, this court believes that the Supreme Court of New Jersey would impose a joint and several coverage obligation for the full amount of plaintiff's loss to be collected from any insurer whose coverage is triggered, subject to contribution or in accordance with any "other insurance" clauses in the policies.
The final questions before the court are 1) whether coverage for the costs of defending an asbestos related claim are triggered only if the exposure to or installation of asbestos potentially falls within the policy period or if coverage is triggered if any part of the continuing personal injury or property damage potentially falls within the policy period, and 2) once the trigger of defense coverage has been established, is the insurer liable for only a prorated portion of defense costs or is it jointly and severally liable for the total amount of such costs without proration to the insured but subject to contribution by other insurers.
The umbrella policies contain the standard CGL "duty to defend" clause which provides that the insurer will
defend any suit against the Insured alleging liability insured under the provisions of this policy and seeking recovery for damages on account thereof even if such suit is groundless, false or fraudulent. ...
It is clear that the duty to defend extends only to claims within the coverage of the policy claims on which there would be a duty to indemnify upon a judgment adverse to an insured. Burd v. Sussex Mutual Insurance Co., 56 N.J. 383, 267 A.2d 7 (1970); Williams v. Bituminous Casualty Corp., 51 N.J. 146, 238 A.2d 177 (1969). It is also clear that while liability may never eventuate, defense costs are inevitable.
Here, where it has been determined that each insurer is fully liable to plaintiff for indemnification, "it follows" that each is fully liable for defense costs without proration to the insured and subject to contribution or in accordance with any "other insurance" clauses in the policies. See Keene, 667 F.2d at 1050. Unless a complaint on its face precludes the possibility that any portion of the continuous process of injury fell within the policy period of a policy, that policy creates an obligation for the entire cost of defense against the claim. When more than one insurer was on the risk during this period of continuous injury, they are jointly and severally liable to plaintiff for costs of defending the suit.
VII
And so one more decision joins the existing plethora of decisions which have addressed these difficult and important issues. Plaintiff's motion for summary judgment is granted. Defendants' cross-motions for summary judgment are denied.
NOTES
[1] Note, "Adjudicating Asbestos Insurance Liability: Alternatives to Contract Analysis", 97 Harv. L.Rev. 739, n. 2 citing P. MacAvoy, J. Karr & P. Wilson, "The Economic Consequences of Asbestos Related Disease 4-12 (July 1983) (unpublished working draft on file in Harvard Law School Library).
[2] Note, "Insurance Coverage of Asbestos Claims Running for Cover or Coverage", 32 Emory L.J. 901, n. 1, citing Hamilton, Rabinovitz & Stanton, Inc., "Cutting the Overhead Costs of Resolving Asbestos Claims: A Time For Action" 3 (Nov. 1982).
[3] Query whether review by the Supreme Court of the United States is likely given that Court's policy against reviewing rulings of Courts of Appeals that purport to be based on state law?
[4] Subsequently, Canadian General paid LAQ approximately $1.7 million in full and final payment of all of Canadian General's past and future obligations to LAQ.
[5] The parties have stipulated to the identity, authenticity and validity of each policy, and to the fact that plaintiff is an insured covered under that policy. Similarly, it has been stipulated that the insurers drafted the policies; that the policies all contained standard form provisions; and that any variations in wording in the various policies over the years have no substantive significance for purposes of this motion.
[6] Defendant Midland Insurance Co. points to this "dramatic quantum leap" as being roughly coincident with LAQ's receipt of the first products liability claim against it. LAQ offers other explanations.
[7] Defendant American Home disagrees with the above statement of the issues only insofar as it suggests that coverage extends to continuing personal injury after the disease process first manifests itself.
[8] The court notes in passing, however, that defendants could have, but did not, urge that New York law be applied given that defendants American Home and Midland are New York corporations with their principal places of business in New York and the insurance policies were apparently executed in New York. In an analogous DES-related claim, at least one New York court has construed coverage to trigger when the disease becomes manifest, a theory defendants do not ask this court to accept presumably, at least in part, because adoption of that theory would maximize coverage over the exposure theory which defendants advocate. See American Motorist Ins. Co. v. E.R. Squibb & Sons, Inc., 95 Misc. 2d 222, 406 N.Y.S.2d 658 (Sup.Ct.1978).
[9] The parties have agreed that the descriptions of asbestosis and mesothelioma in Borel v. Fibreboard Paper Prods. Corp., 493 F.2d 1076, 1083 (5th Cir.1973), cert. denied 419 U.S. 869, 95 S. Ct. 127, 42 L. Ed. 2d 107 (1974) may be taken as accurate for purposes of this case:
[I]nhaling asbestos dust in industrial conditions, even with relatively light exposure, can produce the disease of asbestosis. The disease is difficult to diagnose in its early stages because there is a long latent period between initial exposure and apparent effect. This latent period may vary according to individual idiosyncrasy, duration and intensity of exposure, and the type of asbestos used. In some cases, the disease may manifest itself in less than ten years after initial exposure. In general, however, it does not manifest itself until ten to 25 or more years after initial exposure. This latent period is explained by the fact that asbestos fibers, once inhaled, remain in place in the lung, causing a tissue reaction that is slowly progressive and apparently irreversible. Even if no additional asbestos fibers are inhaled, tissue changes may continue undetected for decades. By the time the disease is diagnosable, a considerable period of time has elapsed since the date of the injurious exposure. Furthermore, the effect of the disease may be cumulative since each exposure to asbestos dust can result in additional tissue changes. A worker's present condition is the biological product of many years of exposure to asbestos dust, with both past and recent exposures contributing to the overall effect. All of these factors combine to make it impossible, as a practical matter, to determine which exposure or exposures to asbestos dust caused the disease.
A second disease, mesothelioma, is a form of lung cancer caused by exposure to asbestos. It affects the pleural and peritoneal cavities, and there is a similarly long period between initial contact and apparent effect. As with asbestosis, it is difficult to determine which exposure to asbestos dust is responsible for the disease.
[10] Defendants Midland and Highlands have agreed, for purposes of this motion, to follow whatever "trigger" applies to the relevant American Home umbrella policy.
[11] This theory was also accepted in ACandS, at least in part to maximize coverage. The Court of Appeals for the Third Circuit affirmed, stating that "it is not our function sitting in diversity to analyze the wisdom of the controlling state law" and holding that exposure, exposure-in-residence, and manifestation all constitute bodily injury within the meaning of the policies. ACandS, Inc. v. The Aetna Casualty and Sur. Co., 764 F.2d 968, 972-73 (3d Cir.1985).
[12] One result: INA was a party in both the Forty Eight and Keene cases with the identical policies setting forth identical coverage affording, after the decisions in those cases, extraordinarily different coverage. Similarly, under the identical insurance policy differences in coverage may well result between states within a single circuit.
[13] But see Eagle-Picher, 682 F.2d at 18, which notes that the district court accepted the parties agreement that the relevant policy language was unambiguous.
[14] The parties have stipulated that, at the time the policies were executed, there had been no negotiations or discussions regarding the trigger of coverage.
[15] There has been interpretation by New Jersey courts of phrases such as "bodily injury" and "trigger of coverage" in the asbestos context and contexts analogous to it in cases construing statutes of limitations and workmen's compensation laws. See, e.g., Biglioli v. Durotest Corp., 44 N.J.Super. 93, 129 A.2d 727 (App.Div.1957) (finding it unnecessary to decide for purposes of workmen's compensation and statute of limitations whether to establish an injury there must be proof of an impairment of bodily function or merely proof of inhalation of beryllium dust causing some cellular process to take place in the body which might or might not result in an impairment at a later time); Hughes v. Eureka Flint etc. Co., Inc., 20 N.J.Misc. 314, 26 A.2d 567 (Cir.Ct.1939). But as the Court of Appeals for the Third Circuit noted, such cases are not particularly relevant to a trigger of coverage issue because the phrase "bodily injury" operates differently in the context of statute of limitations and workmen's compensation issues. ACandS v. Aetna, at 971. It noted that for statute of limitations purposes, for example, manifestation of the disease has generally been deemed to be the time of "injury" because to do otherwise would result in the barring of claims even before plaintiffs knew of their existence. See also Schweitzer v. Consolidated Rail Corp., 758 F.2d 936, 942 (3d Cir.1985) ("We believe ... that subclinical injury resulting from exposure to asbestos is insufficient to constitute the actual loss or damage to a plaintiff's interest required to sustain a cause of action under generally applicable principles of tort law").
[16] Forty Eight Insulations, a pre-Keene case, construed CGL policies to determine whether the exposure or manifestation theory would determine the extent of coverage. The court in part applied New Jersey law to broadly construe the policies to promote coverage and adopted the exposure theory.
[17] See, e.g., Deodato v. Hartford Ins. Co., 143 N.J.Super. 396, 363 A.2d 361 (Law Div.1976) aff'd 154 N.J.Super. 263, 381 A.2d 354 (App.Div. 1977); Muller Fuel Oil Co. v. Ins. Co. of North America, 95 N.J.Super. 564, 232 A.2d 168 (App. Div.1967).
[18] Where the language of an insurance policy is ambiguous, so long as the insured's reading is not unreasonable, that reading will prevail. 13 J.A. & J. Appleman, Insurance Law and Practice (Rev.Ed.1976) at 312-13. The relative size and bargaining power of the parties is not an issue in this case.
[19] The parties have stipulated that in the asbestos property suits pending against plaintiff as of December 31, 1983, the damage alleged includes the following:
(a) physical damage and related cost arising from inspection, restoration, replacement, removal, repair, and/or encapsulation of asbestos products in buildings;
(b) loss of use of property during the period required for repair, removal, replacement, restoration, and/or encapsulation of asbestos products in buildings;
(c) reduction in value of property due to the presence of asbestos products in a building;
(d) physical damage to a building due to the continuing presence of asbestos products in the building;
(e) loss of use of property due to the continuing presence of asbestos products in a building.
[20] In the school context, friable asbestos-containing materials have been used for fireproofing and thermal and acoustical insulation, and are commonly found on steel support beams and columns, on the ceilings of classrooms, corridors, auditoriums, cafeterias, machine shop rooms, and storage rooms. They may also be found on overhead surfaces of indoor pools and gymnasiums. Id. at 47.
[21] Although it does not address the trigger of coverage for asbestos related property claims, Hooksett School District is the only opinion of which the court is aware which addresses in any respect the issue of asbestos related property claims. It is, nonetheless, of limited utility, given the fact that the opinion is unpublished and the fact that it emanated from a motion pursuant to Fed.R.Civ.P. 12(b)(6) with the limited scope of review that rule provides.
[22] Unlike the Keene Corporation which was voluntarily uninsured during its early years of asbestos production and thus, as Judge Wald persuasively argued in her concurring opinion, should not be exempt from liability for injuries occurring during those years, plaintiff has been insured since its entry into the field. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552740/ | 199 B.R. 631 (1996)
In re John W. MILLER and Helga E. Miller.
John W. MILLER and Helga E. Miller
v.
INTERNAL REVENUE SERVICE.
Bankruptcy No. 95-41291-H4-7. Adversary No. 95-4228.
United States Bankruptcy Court, S.D. Texas, Houston Division.
August 28, 1996.
*632 Bernard Brooks, Stafford, Texas, for Debtors.
OPINION ON DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
WILLIAM R. GREENDYKE, Bankruptcy Judge.
On April 3, 1995 Debtors, John and Helga Miller, filed the instant adversary proceeding seeking a determination that their 1986 and 1989 income taxes are not entitled to priority status, and consequently, are dischargeable pursuant to 11 U.S.C. § 507(a)(8) and § 523(a)(1). Subsequently, on July 12, 1995 Defendant, Internal Revenue Service, filed a motion for summary judgment, which is currently pending before the Court. The motion for summary judgment seeks a determination that the Plaintiff's 1986 income taxes are entitled to priority, and therefore, are non-dischargeable pursuant to 11 U.S.C. § 507(a)(8) and § 523(a)(1).[1]
Upon consideration of the Defendant's motion for summary judgment, the Court has concluded that such motion should be GRANTED. Hence, Plaintiff's 1986 income taxes are entitled to priority pursuant to 11 U.S.C. § 507(a)(8) and therefore, are nondischargeable pursuant to 11 U.S.C. § 523(a)(1).
I. Factual Background
On August 27, 1992 Plaintiffs filed a case under Chapter 7 of the United States Bankruptcy Code (the "First Bankruptcy"). Subsequently, on November 4, 1992 Plaintiffs' bankruptcy was converted to a case under Chapter 13. Prior to the First Bankruptcy, the Internal Revenue Service held a secured claim in the amount of $15,831.25 for Plaintiffs' unpaid 1986 income taxes.
Prior to Plaintiffs' filing of their First Bankruptcy, the I.R.S. assessed the 1986 taxes on May 11, 1992. Such assessment occurred 179 days before Plaintiffs filed their First Bankruptcy. The case was later converted to a case under chapter 13, and before Plaintiffs completed their plan, their Chapter 13 case was dismissed, by order entered on December 1, 1994. Accordingly, the Plaintiffs never received a discharge for their 1986 tax liability.
During the period that the Plaintiffs were in their First Bankruptcy, the automatic stay imposed by § 362 remained in effect for a total of 754 days. Furthermore, pursuant to *633 § 6503 of the Internal Revenue Code, the statute of limitations on collection was suspended for 754 days, plus six months after Plaintiff's First Bankruptcy was dismissed. During the First Bankruptcy, the secured claim of the IRS totalled $25,850.82; however, the Plaintiffs paid $7,032.85 in tax and $2,538.90 in interest while the First Bankruptcy was pending.
On February 21, 1995 Plaintiffs filed their second bankruptcy under Chapter 7 of the code, which is currently pending before the Court (the "Second Bankruptcy"). This was eighty-one days after dismissal of their First Bankruptcy and only fifteen days after the IRS had issued a notice of intent to levy.
II. Analysis
Pursuant to 11 U.S.C. § 507(a)(8)(A), a tax liability may be extended priority status if the tax liability was incurred before the petition was filed and the due date for that tax return (including extensions) was after three years before the bankruptcy petition was filed; or the tax liability was assessed any time within 240 days before the petition was filed. See, 11 U.S.C. § 507(a)(8)(A)(i)-(ii).[2] During such periods, a taxpayer may not file bankruptcy without according priority status to such tax claims. Furthermore, section 523(a) declares that priority taxes in § 507(a)(8) are excepted from discharge. 11 U.S.C. § 523(a)(1)(A).
Problems arise, however, when a debtor files successive petitions and, at such later proceedings, the previous priority tax claims no longer meet the three-year or 240 day priority requirements of 11 U.S.C. § 507(a)(8)(A). There are no sections of the Bankruptcy Code which expressly provide that in the case of successive petitions in bankruptcy, the priority periods for the I.R.S. to assess and collect accruing tax liabilities imposed by § 523(a)(1) and § 507(a)(8)(A) may be suspended during the pendency of a previous bankruptcy case. However, courts have dealt with this "loophole" by tolling the priority period by utilizing 11 U.S.C. § 105(a) or § 108(c).
Section 105(a) arguably allows the priority tax period to be equitably tolled, in exercise of the Court's authority to enter any necessary or appropriate orders to carry out the provisions of the bankruptcy code. See, 11 U.S.C. § 105(a).[3] On the other hand, section 108(c) suspends those limitation periods imposed under non-bankruptcy law or by order entered in a non-bankruptcy proceeding. See, 11 U.S.C. § 108(c).[4]
The Fifth Circuit has held in In re Quenzer that section 108(c) suspends only those *634 limitation periods imposed under non-bankruptcy law or non-bankruptcy proceedings and could not be used, upon a debtor's filing of successive bankruptcy petitions, to toll priority periods for collection of taxes during a prior chapter 7 bankruptcy proceeding. In re Quenzer, 19 F.3d 163 (5th Cir.1993). The Court, however, did not look at the equitable tolling power under section 105(a) because it was not argued by the parties involved, but raised only on appeal. Therefore, the taxpayer in Quenzer was able to discharge the debt since it was no longer given priority status. Id.
Following Quenzer, the Bankruptcy Court in In re Clark utilized its equitable powers under section 105(a) to determine that both the "three year period" and the "240 day period" for determining priority status may be tolled during the time the debtors were protected by the automatic stay and for a period of six months after the date the stay was lifted for each prior bankruptcy filing, pursuant to 26 U.S.C. § 6503(b) and (h). In re Clark, 184 B.R. 728 (N.D.Tex.1995). In Clark, the Court determined that the debtors' four bankruptcies served to shield them from any meaningful attempt by the I.R.S. to enforce debtors' 1987 and 1988 tax liability. Moreover, although the debtors were employed during the relevant period, the Court noted that no payments were made to the I.R.S.; and consequently, found Debtors' argument of inability to pay to be less than credible. Id.
In the instant case, the IRS assessed Plaintiffs' 1986 tax liability within 240 days before they filed their First Bankruptcy. After the First Bankruptcy was dismissed on December 1, 1994, they re-filed again only fifteen days after the IRS issued a notice of intent to levy. Although Plaintiffs' did make payment to the IRS towards their 1986 tax liability during their First Bankruptcy, it appears that the Second Bankruptcy was filed to thwart the IRS' notice of intent to levy; and consequently, to shield themselves from any meaningful attempt to address their 1986 tax liability via the protection of the automatic stay. When Plaintiff filed his 1986 tax return, he only reported tax due of $5,919.00. In addition, he made no estimated tax payments during 1986; but included a check with his return in the amount of $1,000, which was subsequently returned for insufficient funds.[5] The facts justify equitable tolling in this case.
Although the bankruptcy code was enacted to provide debtors with certain protections in order to obtain a "fresh start," it was not promulgated as a means to thwart creditors, such as the IRS, by the filing of successive petitions. In particular, the bankruptcy code was not designed to allow debtors to create a scheme of bypassing the code's non-dischargeability provisions by filing a petition, letting the priority period expire, dismiss their case, and re-file again (in order to discharge the taxes), thereby making themselves unreachable by the IRS. The sole purpose of assigning priority status to certain tax claims is to enhance the government's ability to collect such claim. See, West v. United States (In re West), 5 F.3d 423 (9th Cir.1993).
Pursuant to In re Clark, supra, and 11 U.S.C. § 105(a), I conclude it is within my equity jurisdiction to toll the 240 day priority period during the time Debtors were protected by the automatic stay during their First Bankruptcy and for a period of six months thereafter. Consequently, I conclude that priority status exists for the Debtors' 1986 tax liability because the 240 priority period had not accumulated before Debtors filed their present case.
Based upon the foregoing findings and conclusions, it is hereby
ORDERED that Defendants' Motion for Summary Judgment shall be GRANTED by separate form of order entered this day; and it is further
ORDERED that the Clerk's Office provide notice of this opinion to all parties to this adversary proceeding.
*635 ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT
Came on for consideration the Motion for Summary Judgment filed by Defendant, Internal Revenue Service, in the above-referenced adversary. Upon consideration of the Motion, it is hereby
ORDERED that Defendant's Motion for Summary Judgment (Docket # 5) is GRANTED; and it is further
ORDERED that the Clerk's Office provide notice of this Order to all parties to this adversary proceeding.
NOTES
[1] The parties have stipulated that Plaintiff's have paid their 1989 taxes in full. Therefore, the priority and dischargeability issues regarding such taxes as alleged in the Plaintiff's complaint are moot. As a result, this opinion will focus only on the priority and dischargeability of Plaintiff's 1986 income taxes.
[2] Section 507(a)(8)(A) accords priority status to ". . . allowed unsecured claims of governmental units, only to the extent that such claims are for
(A) a tax on or measured by income or gross receipts
(i) for a taxable year ending on or before the date of the filing of the petition for which a return, if required, is last due, including extensions, after three years before the date of the filing of the petition;
(ii) assessed within 240 days, plus any time plus 30 days during which an offer in compromise with respect to such tax that was made within 240 days after such assessment was pending, before the date of the filing of the petition; or
(iii) other than a tax of a kind specified in section 523(a)(1)(B) or 523(a)(1)(C) of this title, not assessed before, but assessable, under applicable law or by agreement, after, the commencement of the case;"
See, 11 U.S.C. § 507(a)(8)(A) (1978).
[3] Section 105(a) provides "the court may issue any order, process, or judgment that is necessary or appropriate to carry out the provisions of this title. No provision of this title providing for the raising of an issue by a party in interest shall be construed to preclude the court from, sua sponte, taking any action or making any determination necessary or appropriate to enforce or implement court orders or rules, or to prevent an abuse of process." 11 U.S.C. § 105(a) (1978).
[4] Section 108(c) states that ". . . if applicable nonbankruptcy law, an order entered in a nonbankruptcy proceeding, or an agreement fixes a period for commencing or continuing a civil action in a court other than a bankruptcy court on a claim against the debtor, or against an individual with respect to which such individual is protected under section 1201 or 1301 of this title, and such period has not expired before the date of the filing of the petition, then such period does not expire until the later of . . . the end of such period, including any suspension of such period occurring on or after the commence of the case; or . . . 30 days after notice of the termination or expiration of the stay under section 362, 922, 1201, or 1301 of this title, as the case may be, with respect to such claim. 11 U.S.C. § 108(c)(1)-(2) (1978).
[5] Although Plaintiffs have paid their 1989 taxes in full, the collection efforts undertaken by the IRS towards their 1989 tax liability further demonstrates the failure to meaningfully address their tax obligations. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1660068/ | 644 So. 2d 856 (1994)
Dr. Jerzy S. KOSMALA
v.
James PAUL and The Baton Rouge Symphony Association.
No. 93 CA 2117.
Court of Appeal of Louisiana, First Circuit.
October 7, 1994.
*857 Mark E. Falcon, Baton Rouge, for appellant, Dr. Jerzy S. Kosmala.
Gordon A. Pugh, Baton Rouge, for appellees, James Paul and The Baton Rouge Symphony Ass'n.
Before GONZALES, FOGG and PARRO, JJ.
GONZALES, Judge.
PROCEDURAL HISTORY
Dr. Jerzy S. Kosmala filed suit against the Baton Rouge Symphony Association (BRSA) and James Paul, the music director for the BRSA, on March 10, 1989, alleging that the defendants had wrongfully failed to re-engage him for the 1988-89 symphony season. Kosmala alleged that the BRSA and Mr. Paul, with full knowledge that he was out of town on an approved leave of absence, mailed his 1988-89 contract to his Baton Rouge address, knowing that he would not receive it in sufficient time to return it to the BRSA to signify his intent to return for the upcoming symphony season as required by his contract with the BRSA.
Defendants filed a declinatory exception raising the objection of lack of subject matter jurisdiction and a dilatory exception raising the objection of prematurity, based on their contention that Dr. Kosmala's complaint was subject to binding arbitration pursuant to the master contract between the BRSA and the Baton Rouge Musicians Association, Local 538. The trial court denied both exceptions, ruling that the failure of defendants to re-engage Dr. Kosmala was not based on any of the grounds set forth in the contract which mandated arbitration. Defendants then applied for supervisory writs, which were denied by this Court on January 5, 1990. Defendants then applied for supervisory and/or remedial writs to the Louisiana Supreme Court. The Louisiana Supreme Court granted the writ on March 22, 1990, 558 So. 2d 577, and this matter was remanded back to this Court.
On remand, this Court upheld the trial court's denial of defendants' exceptions. 569 So. 2d 158. Defendants then applied for writs to the Louisiana Supreme Court from this decision, which were denied by the Louisiana Supreme Court on January 11, 1991. Defendants thereafter answered and filed a peremptory exception raising the objection of no cause of action on March 14, 1991.
The parties then settled a portion of the case, reinstating Dr. Kosmala to the position of co-principal violist and paying his back wages. The remaining issues are: 1) whether Dr. Kosmala is entitled to nonpecuniary damages for breach of contract under La.C.C. art. 1998, and 2) whether he is entitled to recovery for intentional infliction of emotional distress. Defendants filed a motion for summary judgment on these remaining issues on March 19, 1993, which motion was granted by the trial court on July 29, 1993. Dr. Kosmala appealed and made the following assignments of error:
1. The trial court erred in interpreting La.C.C. art. 1998 to require, as a prerequisite to the receipt of nonpecuniary damages, that the nonpecuniary benefit must enure to the obligee as the result of the obligor's performance.
2. The trial court erred in finding that no genuine issue of material fact existed as to the "object" of Dr. Kosmala's contract with the BRSO.
3. The trial court erred in finding that no genuine issue of material fact existed on the issue of Dr. Kosmala's entitlement to nonpecuniary damages under La.C.C. art. 1998.
4. The trial court erred in ignoring the last paragraph of La.C.C. art. 1998 which clearly provides a cause of action for nonpecuniary damages where, regardless of the nature of the contract, the obligor intended, through his failure, to aggrieve the feelings of the obligee.
5. The trial court erred in finding that no genuine issue of material fact existed on the elements of a cause of action for intentional infliction of emotional distress.
6. The trial court erred in granting summary judgment in favor of appellees on the issue of Dr. Kosmala's claim for damages for intentional infliction of emotional distress.
*858 Generally, a motion for summary judgment should be granted only if the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, show there is no genuine issue as to a material fact and that the mover is entitled to judgment as a matter of law. La.C.C.P. art. 966; Thompson v. South Central Bell Telephone Company, 411 So. 2d 26, 27 (La.1982). The burden is upon the mover for summary judgment to show that no genuine issue of material fact exists, and only when reasonable minds must inevitably conclude that the mover is entitled to judgment as a matter of law is summary judgment warranted. Robertson v. Our Lady of the Lake Regional Medical Center, 574 So. 2d 381, 384 (La.App. 1st Cir.1990), writ denied, 573 So. 2d 1136 (La.1991). Appellate courts review summary judgments de novo, using the same criteria applied by the trial courts in determining whether summary judgment is appropriate. Schroeder v. Board of Supervisors of Louisiana State University, 591 So. 2d 342, 345 (La.1991).
ASSIGNMENTS OF ERROR NO. 1, 2, 3 AND 4
Louisiana Civil Code article 1998 provides as follows:
Damages for nonpecuniary loss may be recovered when the contract, because of its nature, is intended to gratify a nonpecuniary interest and, because of the circumstances surrounding the formation or the nonperformance of the contract, the obligor knew, or should have known, that his failure to perform would cause that kind of loss.
Regardless of the nature of the contract, these damages may be recovered also when the obligor intended, through his failure, to aggrieve the feelings of the obligee.
In its written reasons for judgment, the trial court states in part:
This court is of the opinion that LSA-C.C. Art. 1998 is inapplicable to plaintiff's claim of nonpecuniary loss. Under a common sense interpretation of this code article, nonpecuniary damages may only be recovered by an obligee who suffers nonpecuniary loss as a result of the nonperformance of the obligor. In other words, the nonpecuniary benefit contemplated must arise out of the performance of another. The fact that a contracting party derives a significant nonpecuniary benefit from his own performance does not entitle that party to recover for such loss if the contract is breached by the other party and he is therefore unable to perform.
Dr. Kosmala argues that the trial court erred in denying him recovery for nonpecuniary damages, citing Young v. Ford Motor Co, Inc., 595 So. 2d 1123 (La.1992) as support for this argument. Dr. Kosmala contends the trial court should have focused on his (the obligee's) motive for entering the contract, citing Young as follows:
Article 1998 permits recovery of damages for nonpecuniary loss where the obligee intends to gratify interests both pecuniary and nonpecuniary or where the interest is exclusively nonpecuniary. In either situation, however, the nature of the contract (including the facts and circumstances attending its formation) must demonstrate that gratification of the nonpecuniary interest constitutes a significant interest. In this case, plaintiff was properly denied recovery for emotional distress because the evidence at trial did not indicate that a significant objective of plaintiff's in purchasing the pickup truck was gratification of a nonpecuniary interest.
595 So.2d at 1124. We note that in Young the plaintiff was not an artisan, and further, the court limited the holding to the following issue: "to determine whether the purchaser of a defective or useless vehicle which has not caused physical injury can recover damages for emotional distress." Young, 595 So.2d at 1124. Moreover, in that case, the Supreme Court affirmed the appellate court's denial of nonpecuniary damages.
As a policy matter this case has to be viewed as a contract with an artisan. The attempts to expand the coverage of damages for breach of contract in the area of nonpecuniary losses have been rebuffed by both the Louisiana Law Institute and the Louisiana legislature. To hold that an artisan whose services are engaged could secure damages *859 for nonpecuniary loss in the event of a breach of that contract is unwarranted and without precedent. Where a contract is for performance of an artistic work such as a concert given by a musician, a portrait made by a painter, or a wedding dress sewn by a seamstress, and the artisan breaches the contract, the patron has an action for nonpecuniary loss; however, the artisan does not have an action for nonpecuniary loss if the patron breaches that contract. Our holding is limited to this type of contractual setting.
The trial court was correct in finding that, as to Dr. Kosmala's claim for nonpecuniary damages, there was no genuine issue of material issue of fact and that defendants were entitled to judgment as a matter of law.
ASSIGNMENTS OF ERROR NO. 5 AND 6
In order for Dr. Kosmala to recover damages on his claim for intentional infliction of emotional distress, he must establish (1) that the conduct of the defendant was extreme and outrageous; (2) that the emotional distress suffered by the plaintiff was severe; and (3) that the defendant desired to inflict severe emotional distress or knew that severe emotional distress would be certain or substantially certain to result from his conduct. White v. Monsanto Company, 585 So. 2d 1205, 1209 (La.1991). The conduct must be "so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious and utterly intolerable in a civilized community." White, 585 So.2d at 1209.
We find that the actions complained of by Dr. Kosmala, namely Mr. Paul's request that Dr. Kosmala resign his position with the BRSA, and the failure of the BRSA to renew Dr. Kosmala's contract, although perhaps humiliating and embarrassing to Dr. Kosmala, fall far short of meeting the criteria necessary to recover for intentional infliction of emotional distress. The trial court was correct in finding that as to intentional infliction of emotional distress, there was no issue of material fact and that defendants were entitled to judgment as a matter of law.
DECREE
For the foregoing reasons, the trial court judgment is affirmed. Dr. Kosmala is cast for all costs.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1716710/ | 332 So. 2d 433 (1976)
Bruce MEADOR and Gretchen Meador
v.
TOYOTA OF JEFFERSON, INC., et al.
No. 57218.
Supreme Court of Louisiana.
May 17, 1976.
Marvin C. Grodsky, New Orleans, for plaintiffs-applicants.
Fernand F. Willoz, III, New Orleans, for defendants-respondents.
CALOGERO, Justice.
May an automobile owner recover damages for aggravation, distress, and inconvenience from a repairman who has unnecessarily *434 and excessively delayed completion of the vehicle's repair? This is the principal question presented in this case. It is to be answered by the construction to be given that portion of Civil Code article 1934(3) which allows the recovery of nonpecuniary loss "[w]here the contract has for its object the gratification of some intellectual enjoyment, whether in religion, morality or taste, or some convenience or other legal gratification . . . ."[1]
Following a collision, an eighteen-year-old girl brought her first acquired automobile, a 1971 model Toyota, to defendant, Toyota of Jefferson, Inc., for repair late in February of 1972. It was returned to her on September 20, 1972, some seven months later. In her suit for damages (she was joined in the suit by her father), the trial court awarded her $1554.77, which included $602.77 as reimbursement for seven of her monthly car notes, $252 for seven monthly insurance payments, and $700 for aggravation, distress, and inconvenience. The Court of Appeal agreed that defendant had breached its contract, but concluded that the undue delay consisted of only five of the seven months' repair period. Accordingly, it reduced the $602.77 and the $252 portions of the award by two-sevenths, allowing, respectively, $430.55 and $180, for a total of $610.55. The Court of Appeal disallowed the $700 awarded by the trial court for aggravation, distress, and inconvenience, and in these particulars amended the judgment in favor of plaintiffs. Meador v. Toyota of Jefferson, Inc., 322 So. 2d 802 (La.App.4th Cir. 1975).
We granted writs upon plaintiff's complaint that the Court of Appeal erred in disallowing the $700 portion of the award for aggravation, distress and inconvenience. Meador v. Toyota of Jefferson, Inc., 323 So. 2d 804 (La.1976). Defendant did not seek writs.[2] Accordingly, and because of the result we reach hereinafter on the only remaining issue in the litigation, the part of the Court of Appeal judgment awarding plaintiff $610.55 is not before us. C.C.P. art. 2167; Madison v. American Sugar Refining Co., 243 La. 408, 144 So. 2d 377 (1962); Blades v. Southern Farm Bureau Casualty Ins. Co., 237 La. 1, 110 So. 2d 116 (1959); May Finance Co. v. Nagy, 223 La. 816, 66 So. 2d 860 (1953).
We have reviewed the transcript and agree with the factual findings of the Court of Appeal. Defendant did indeed breach the implied obligation to repair within a reasonable time; the undue delay amounted to five months; $610.55 is a fair assessment of plaintiff's recoverable pecuniary loss. (As noted earlier, this element is no longer before us). Furthermore, if recoverable, $700 would be a reasonable and proper award for plaintiff's nonpecuniary damages, i.e., her aggravation, distress, and inconvenience. Accordingly, we direct our attention to the principal question posed at the outset of this opinion.
Generally, recovery for damages upon the breach of a contract is limited to the loss a person has sustained or the profit of *435 which he has been deprived.[3] However, in certain limited circumstances a person may, upon the breach of a contract, recover damages for nonpecuniary loss. It is this sort of damage which plaintiff herein seeks to recover. Plaintiff argues that she is due recovery for aggravation, distress, and inconvenience which resulted from her inability to use her automobile for the period during which defendant unreasonably delayed its repair. She argues that this damage is recoverable under Civil Code Article 1934(3) which, as we indicated earlier, allows recovery for nonpecuniary loss "[w]here the contract has for its object the gratification of some intellectual enjoyment, whether in religion, morality or taste, or some convenience or other legal gratification . . . ." She argues specifically that the disjunctive "or" in the article means that nonpecuniary damages are allowed where the contract has for its object the gratification either of "some intellectual enjoyment" or of "some convenience." Thus she contends that to gain recovery under the article, one need not show that the contract contained any intellectual element whatsoever; one may recover even when the object of the contract is purely physical gratification. This liberal position is supported by language, at least, in the First Circuit Court of Appeal opinion in Jack v. Henry, 128 So. 2d 62 (La.App.1st Cir. 1961).[4] An alternative, broader position which also supports plaintiff's recovery is that it suffices, to permit nonpecuniary damages, that the object or objects of the contract include elements of both intellectual and physical gratification. See Holland v. St. Paul Mercury Ins. Co., 135 So. 2d 145 (La.App.1st Cir. 1961), Meyer v. Succession of McClellan, 30 So. 2d 788 (La.App.Orl.1947), Melson v. Woodruff, 23 So. 2d 364 (La.App.1st Cir. 1945).
On the other hand, defendant contends that in order for plaintiff to recover nonpecuniary damages, the object of the contract must be exclusively intellectual enjoyment, as opposed to partially intellectual partially physical, and as opposed to exclusively physical enjoyment. This strict interpretation is given support in the jurisprudence by such cases as Rigaud v. Orkin Exterminating Co., 236 So. 2d 916 (La.App. 3d Cir. 1970), Baker v. Stamps, 82 So. 2d 858 (La.App.Orl.1955), Lillis v. Anderson, 21 So. 2d 389 (La.App.Orl.1945), and Sahuc v. United States Fidelity & Guar. Co., 320 F.2d 18 (5th Cir. 1963).
This Court has never adopted a strict view but has reached results favoring the broader interpretation of Art. 1934(3).[5] In Lewis v. Holmes, 109 La. 1030, 34 So. 66 (1903) a bride had contracted with the defendant store for the manufacture, or sewing, of five dresses, one for her wedding and the others for her trousseau. She was allowed recovery for deprivation of intellectual enjoyment and for mental suffering in connection with defendant's non-delivery of the four dresses for her trousseau. The contract's object was not purely intellectual, but rather entailed features both physical (her need for comfortable clothing), and intellectual (her preference *436 for style, or "taste," and concern with her appearance on her wedding day and on her honeymoon).
Two other cases where the Court allowed recovery and where there existed elments of both intellectual and physical gratification were O'Meallie v. Moreau, 116 La. 1020, 41 So. 243 (1906) and Jiles v. Venus Community Center Benevolent Mutual Aid Assn., 191 La. 803, 186 So. 342 (1939). In O'Meallie, the Court awarded damages for annoyance and vexation to a social club for breach of a contract to lease a picnic area, and in Jiles the Court awarded plaintiff damages for mental anguish from watching her child die without proper medical attention because of defendant Association's breach of a contract to supply doctors' services and medicine.
In none of the foregoing cases, however, has the Court historically viewed the source of Article 1934(3) and the origin thereof.
The third paragraph of Article 1934 had no counterpart in the Code Napoleon or the Louisiana Civil Code of 1808. The paragraph first appeared in the Louisiana Civil Code of 1825.[6] That Code was drafted in French, translated into English. Both French and English versions are official texts of the Code.[7] To interpret the Article, then, where as here the articles of the 1870 Code is not entirely clear,[8] we deem it helpful to examine the French and English versions of the article in the Code of 1825.
In the French version of the 1825 Louisiana Civil Code, the pertinent clause of Art. 1928 read:
"Lorsque le contract a pour but de procurer a quelqu'un une jouissance purement intellectuelle, telle que celles qui tiennent a la religion, a la morale, augout, a la commodite ou a toute autre espece de satisfaction de ce genre, . . . ."
Translated into English this passage reads:
"When the contract has for its object to confer to someone a purely intellectual enjoyment, such as those pertaining to religion, morality, taste, convenience or other gratifications of this sort,. . . ."[9]
*437 The foregoing French article was mistranslated to read in the English version of Article 1928 of the Louisiana Civil Code of 1825, as follows:
"Where the contract has for its object the gratification of some intellectual enjoyment, whether in religion, morality, or taste, or some convenience or other legal gratification, . . . ."
The English passage was copied verbatim into the Code of 1870.[10] Thus we conclude that the clause should, as it may, logically, be read as follows: Where the contract has for its object the gratification of intellectual enjoyment, such as that pertaining to religion, or morality, or taste, or convenience, . . . .
It is evident that the proper interpretation of Article 1934(3), is not, as plaintiff contends, that nonpecuniary damages are allowable where the object is exclusively physical gratification. On the contrary, "convenience" in the source provision was not a contract object triggering the availability of nonpecuniary damages, but was, rather, along with religion, morality, and taste, one example of "purely intellectual enjoyment," the intellectual enjoyment being necessary as a contract's object before nonpecuniary damages became available.
We find the French source provision of 1934(3) in the 1825 Louisiana Civil Code, if not controlling, at least persuasive in our present interpretation of the article's ambiguous counterpart in our 1870 Civil Code. While the foregoing interpretation does not allow nonpecuniary damages where the sole object is physical gratification, a proper interpretation of the entirety of Article 1934(3) does not in our view bar such damages in all instances where there exists as an object physical gratification. We believe that a contract can have "for its object" intellectual enjoyment, assuming that intellectual enjoyment is a principal object of the contract, notwithstanding that a peripheral, or incidental, or even perhaps concurrent object of the contract may be physical gratification.
Thus, we would interpret Article 1934(3) as follows: Where an object, or the exclusive object, of a contract, is physical gratification (or anything other than intellectual gratification) nonpecuniary damages as a consequence of nonfulfillment of that object are not recoverable.
On the other hand, where a principal or exclusive object of a contract is intellectual enjoyment, nonpecuniary damages resulting from the nonfulfillment of that intellectual object are recoverable. Damages in this event are recoverable for the loss of such intellectual enjoyment as well as for mental distress, aggravation, and inconvenience resulting from such loss, or denial of intellectual enjoyment.
The foregoing principles are not at variance with the results obtained in the cases of Lewis v. Holmes, supra, O'Meallie v. Moreau, supra, and Jiles v. Venus Community Center Benevolent Mutual Aid Assn., supra.
Applying these principles to the case at hand, we conclude that plaintiff is not entitled to recover damages for aggravation, distress, and inconvenience caused by the five month loss of use of her automobile, because the procuring of intellectual enjoyment, while perhaps an incidental or inferred contemplation of the contracting parties, was not a principal object of the contract to have the car repaired. The principal object of the contract, the overriding concern of plaintiff, evident to defendant at the time the contract was entered into, was the repair of plaintiff's automobile with its consequent utility or physical gratification.
As noted, we clearly do not hold that the object of a contract must be exclusively intellectual *438 enjoyment in order to trigger article 1934(3)'s nonpecuniary damages. We do hold, however, that such intellectual enjoyment must be a principal object of the contract, and that nonpecuniary damages, when allowed, are limited to those which compensate for, or are directly related to, nonfulfillment of the intellectual object.
We also deem it worth noting, however fundamental, that unlike the rule which we are required by the Civil Code to apply in this action for breach of contract, damages for mental anguish, aggravation, distress and inconvenience, are recoverable in an action sounding in tort. La.Civil Code art. 2315; 2 M. Planiol, Traite elementaire de droit civil, no. 252 at 152 (11th ed., La.State L.Inst.tranl.1959); 48 Tul.L.Rev., supra at 1171.
Perhaps it would be better if damages for mental anguish in breach of contract cases were allowable just as in tort actions. However, such a matter directs itself to the law maker. Our responsibility is to interpret and apply the law, not to enact it.
For the foregoing reasons, the judgment of the Court of Appeal is affirmed. All costs of this appeal are chargeable to the plaintiff.
MARCUS, J., assigns additional concurring reasons.
DIXON, J., dissents with reasons.
MARCUS, Justice (assigning additional concurring reasons).
While I join in the majority opinion, in my view, damages are not awardable for annoyance and emotional distress in breach of contract cases unless the gratification of purely intellectual enjoyment is the principal object of the contract. Where only an incidental or concurrent object of the contract is the gratification of purely intellectual enjoyment, damages for annoyance and emotional distress are not recoverable.
DIXON, Justice (dissenting).
I respectfully dissent. We should not deny recovery for damages which are suffered, for which justice requires compensation, for the rather superficial reason that plaintiff's action is in contract, not tort. Nevertheless, even considering this a contract action, these damages are recoverable under the plain terms of C.C. 1934(1).
When plaintiff brought her vehicle to defendant for repairs, she had the right to expect that the repairs be completed within a reasonable time. They were not. As a result, not only did she suffer pecuniary loss, but also the aggravation of not having her car, the distress of not knowing when she would get it back, and finally the inconvenience of having to find other methods of getting around. In a society as dependent on the automobile as ours, where a car is not only a convenience but often a necessity, a plaintiff should be able to recover damages representing the aggravation, distress and inconvenience suffered when the repairman breaches his duty to fix the car within a reasonable time. Such damages are reasonably within the contemplation of the parties at the time the contract was entered into, and are therefore compensable. C.C. 1934(1).
This court has consistently awarded damages for mental anguish and inconvenience in tort suits where property damage is sustained. In Dodd v. Glen Rose Gasoline Co., 194 La. 1, 193 So. 349 (1939), in which defendant's plant operated in a manner that prevented plaintiff from getting a good night's sleep, this court awarded damages for inconvenience and discomfort. In McGee v. Yazoo & M.V.R. Co., 206 La. 121, 19 So. 2d 21 (1944), this court awarded damages for mental anguish, worry and inconvenience caused by the depositing of soot, smoke and cinders into plaintiffs' houses by defendant's roundhouse operation. In Fontenot v. Magnolia Petroleum Co., 227 La. 866, 80 So. 2d 845 (1955), we awarded damages for inconvenience and mental anguish suffered by plaintiff as a result of defendant's blasting operations.
*439 There is no logical reason to allow recovery of such damages when property is involved in cases delineated as "tort," and yet deny recovery of similar damages when property is involved (as in this case), simply because the cause of action is delineated as "contract." Both involve a duty and a breach. Louisiana employs fact pleading. A plaintiff need only state facts, which, if true, authorize recovery. Cox v. W. M. Heroman & Co., 298 So. 2d 848 (La.1974). In the instant case, plaintiff has proved, to the satisfaction of the trier of fact, that she suffered inconvenience, distress and aggravation because of defendant's breach of duty. She should recover therefor. As Planiol states:
". . . The big objection is that mental suffering can not be compensated with money. But that is done every day in the case of torts; why act differently in contract cases? There is no reason for not doing so, and as M. Boistel has well said, just because one can not do so better, is no reason for doing nothing at all."[1]
NOTES
[1] L.C.C. art. 1934(3) provides:
"Although the general rule is, that damages are the amount of the loss the creditor has sustained, or of the gain of which he has been deprived, yet there are cases in which damages may be assessed without calculating altogether on the pecuniary loss, or the privation of pecuniary gain to the party. Where the contract has for its object the gratification of some intellectual enjoyment, whether in religion, morality or taste, or some convenience or other legal gratification, although these are not appreciated in money by the parties, yet damages are due for their breach; a contract for a religious or charitable foundation, a promise of marriage, or an engagement for a work of some of the fine arts, are objects and examples of this rule."
* * * * *
[2] Originally sued by plaintiffs were Toyota of Jefferson, Inc., Toyota Motor Sales, U.S.A. Inc., Gulf States Toyota, Inc., and State Farm Mutual Automobile Ins. Co. Only respondent Toyota of Jefferson, Inc., was cast in damages by the trial court; the other defendants were dismissed.
[3] L.C.C. art. 1934 provides:
"Where the object of the contract is any thing but the payment of money, the damages due to the creditor for its breach are the amount of the loss he has sustained, and the profit of which he has been deprived, under the following exceptions and modifications."
[4] In the Jack case, the court stated:
"[W]e believe that a contract for the construction of a home . . . has as its object the convenience of the owner within the meaning and intendment of the phrase `or some convenience' as used in Paragraph 3, Article 1934, LSA-R.C.C. entitling the owner of a residence to damages for inconvenience resulting from a contractor's breach of the obligation . . . ." 128 So.2d at 72.
[5] For an excellent comment on this subject, including the "liberal," "broad," and "strict" interpretation in the jurisprudence see "Damages ex contractu: Recovery of Nonpecuniary Damages For Breach of Contract Under Louisiana Civil Code Article 1934," by Henri Wolbrette, III, 48 Tul.L.Rev. 1160 (1974).
[6] It has been suggested that the source of this paragraph was Toullier, 6 Droit Civil, Liv. III, Tit. III, Chap. III, Sec. IV, § III, n. 293 (305 seq.) and Domat, I Loix Civiles, Part. I, Liv. III, Tit. V, Sec. II, ns. XI, XII (270). Batiza, The Actual Sources of the Louisiana Project of 1823: A General Analytical Survey, 47 Tul.L.Rev. 1, 80 (1972). Neither of these sources, however, contained the precise idea contained in 1934(3), although Domat does include a passage suggestive of the principle incorporated in 1934(3). See 48 Tul.L.Rev., supra at 1173.
[7] I A General Digest of the Acts of the Legislature of Louisiana passed from the year 1804, to 1827, Inclusive 223 (1928); see generally Dainow, The Louisiana Civil Law, in Civil Code of Louisiana (Dainow ed., 1961).
[8] 48 Tul.L.Rev., supra at 1174.
[9] While the disjunctive "or" prefacing "some convenience" or other legal gratification might arguably suggest that nonpecuniary damages are allowed "where the contract has for its object the gratification" of "some convenience," the ambiguity in the language of the paragraph becomes apparent when article 1934 is read in its entirety and in conjunction with article 1926. Article 1926 provides that in breach of contract cases damages may be given "according to the rules established in the following section." Article 1934 appears in the following section of the Code. It provides at the outset that with an exception not here relevant damages due for breach of contract are the amounts of loss and deprived profits, except for exceptions and modifications related thereafter in three numbered paragraphs. The third numbered paragraph recites the general rule, and then there appears the exception which employs the language here at issue. See Footnote 1, second sentence of the quoted article 1934(3). If that sentence were intended to allow nonpecuniary damages where a contract has for its object "some" (virtually every contract of which we can conceive) convenience there would be no sense to the outset language of article 1934 limiting damage to losses sustained and profits of which deprived as a general proposition.
[10] Only the comma after "morality" was deleted in the version of the passage in the 1870 Code.
[1] 2 M. Planiol, Traite Elementaire de Dorit Civil No. 252 (11th ed. La.State L.Inst.Trans.(1959). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1754601/ | 999 S.W.2d 107 (1999)
Rodger SWINK, Appellant,
v.
Joe ALESI and David Behrend, Appellees.
No. 14-98-00105-CV.
Court of Appeals of Texas, Houston (14th Dist.).
July 29, 1999.
Rehearing Overruled August 26, 1999.
*108 Gus E. Pappas, Christopher A. Gregg, Houston, for appellants.
Frank G. Vlahakos, Houston, for appellees.
Panel consists of Justices MAURICE E. AMIDEI, EDELMAN and WITTIG.
OPINION
MAURICE E. AMIDEI, Justice.
Rodger Swink (Swink) appeals from a judgment for appellees' attorney's fees entered by the trial court on a motion to disregard jury findings. Appellees sued Swink for breach of a contract to sell a business. Swink counter-claimed for breach of the same contract, fraud, conversion, slander, and attorney's fees. In two issues, Swink contends the trial court erred: (1) in awarding appellees their attorney's fees upon their motion to disregard the jury's finding of zero attorney's fees; and (2) requiring appellant to elect between taking his damage award for breach of contract or his damage award for fraud. We reverse the judgment of the trial court, in the part that awarded appellees their attorney's fees, and render judgment that appellees take nothing. The judgment of the trial court is modified to add attorney fees through this appeal. In all other respects, the judgment of the trial court is affirmed.
I. FACTUAL AND PROCEDURAL BACKGROUND.
On November 28, 1990, Swink and appellees entered into a written contract whereby appellees agreed to transfer ownership of a foam business located in appellees' warehouse in exchange for Swink's agreement to allow appellees the use of a 630 square foot space in the southwest corner of the same warehouse. "Custom Foam" was a business that sold various sizes of cushioning foam used in sofas, mattresses, and packaging. As part of the agreement, appellees agreed to transfer ownership of all existing accounts and some office equipment to Swink for his agreement to allow appellees the use of the warehouse space for five years commencing October 1, 1990. Also, appellees agreed to refer all foam sales to Swink. On March 16, 1993, Swink evicted appellees, and appellees sued for the value of the remaining 30 months due to them on the contract plus attorney's fees under section 38.001, Texas Civil Practice and Remedies Code. Swink counter-claimed for appellees' breach of the same contract alleging appellees were still selling his foam and keeping the sales proceeds. Swink also counter-claimed for slander, conversion, fraud, and attorney's fees.
The jury found both Swink and appellees failed to comply with the agreement. The jury awarded appellees zero damages and zero attorney's fees. The jury awarded Swink $1,500.00 for appellees' failure to comply with the contract, plus $1,000.00 damages for fraud committed by appellees. The jury also found zero damages for Swink's slander claim, and awarded Swink $400.00 on his conversion claim, plus $24,000.00 attorney's fees for trial preparation, with additional fees for appeals.
Appellees filed a motion to disregard the jury's finding of zero attorney's fees in Question 3 on the ground that there was no evidence to support such a finding. *109 Appellees also contested the jury's findings of their breach of the contract with Swink, their slander of Swink, and Swink's attorney's fees. The trial court granted appellees' motion to disregard only as to the attorney's fee finding (question 3), and denied the remainder of the motion. The trial court rendered judgment for appellees for $35,710.00 in attorney's fees. The trial court rendered judgment for Swink as follows:
1. $1,500.00 Breach of Contract Damages
2. 24,000.00 Attorney's fees (plus $17,500.00
fees for appeals)
3. 400.00 Conversion claim
__________
$25,900.00 Total
The jury had also awarded Swink $1,000.00 for his fraud claim, and the trial court advised Swink he would have to elect between taking his contract damages or the fraud claim because his fraud claim arose out of his contract claim. Swink elected to take the award for his contract claim ($1,500.00 for breach contract plus attorney's fees).
II. AWARD OF APPELLEE'S ATTORNEY FEES.
In issue one, appellant contends the trial court erred in awarding appellees' attorney's fees. He argues the trial court committed five errors by entering this judgment:(1) the trial court erred by disregarding the jury's zero finding of attorney's fees for appellees; (2) the trial court erred in failing to exclude testimony of appellees' expert on attorney's fees; (3) the trial court erred in making and substituting its fact finding to question 3; (4) the trial court failed to segregate appellees' attorney's fees; and (5) the trial court erred by failing to disregard jury's finding that Swink breached the contract.
Under subpoint one, appellant argues that to recover attorney's fees under section 38.001, Texas Civil Practice and Remedies Code, appellees were required to recover damages. Although the jury found that Swink failed to comply with the contract, the jury found appellees had zero damages. Accordingly, appellant argues that appellees did not "prevail" and were not entitled to attorney's fees as a matter of law under the holding in Green International, Inc. v. Solis, 951 S.W.2d 384 (Tex. 1997).
Appellees argue that Green does not apply to this case because the Supreme Court did not discuss whether the contract contained an attorney's fees clause. In Green, the jury found that Solis failed to comply with Green's building contract, but awarded zero damages to Green. Green, 951 S.W.2d at 390. The Green opinion is silent with respect to whether Green's contract had a provision for attorney's fees in the event of a breach. The supreme court held that because Green failed to recover damages on his breach of contract claim, he was not entitled to recover attorney's fees under section 38.001, Texas Civil Practice and Remedies Code. Id. The supreme court stated the general rule under section 38.001(8): "[t]o recover attorney's fees under section 38.001, a party must (1) prevail on a cause of action for which attorney's fees are recoverable, and (2) recover damages." Id.
Appellees argue that a finding of zero damages and zero attorney fees does not bar a recovery of attorney fees because the jury found that Swink failed to comply with the agreement. Therefore, appellees contend they "prevailed" and cite El Paso Healthcare v. Piping Rock Corp., 939 S.W.2d 695, 702 (Tex.App.El Paso 1997, writ denied) and Atlantic Richfield Co. v. Long Trusts, 860 S.W.2d 439, 449 (Tex. App.Texarkana 1993, writ denied) as authority. In El Paso Healthcare, 939 S.W.2d at 702 (EPHS), the court of appeals held that the jury's finding of zero damages on a contract claim did not preclude an award of stipulated attorney's fees made contingent upon a jury verdict. In that case, the parties stipulated on the record that Piping Rock incurred $195,000 in reasonable attorney's fees and EPHS incurred $295,000 in reasonable attorney's fees. By stipulation, the parties agreed that the recovery of such attorney's fees *110 was reserved for decision by the trial court based upon the jury verdict. The jury found that Piping Rock breached the agreement, and evidence supported the finding. The court of appeals held: "[I]n light of the parties' stipulation and the jury finding of an unexcused breach, we find that EPHS was entitled to attorney's fees...." Id. We find EPHS is factually dissimilar to this case and is not applicable. In this case, there was no stipulation by the parties as to the amount of fees to be awarded at the court's discretion based on the jury verdict.
In Atlantic Richfield Co. (ARCO), 860 S.W.2d at 449-50, ARCO argued that it was entitled to recover its attorney's fees under section 38.001, Texas Civil Practice and Remedies Code, from Long Trusts under the terms of the joint operating agreements between the parties because it won that portion of the lawsuit involving drilling costs due from Long Trusts. Id. at 449. The jury had returned a zero finding to ARCO's damage issue. Id. at 450. During the pendency of the lawsuit, ARCO was able to recoup most of the drilling costs by applying the proceeds from the sale of Long Trusts' share of the gas produced to the drilling costs, and these amounts that had been applied were undisputed. Id. at 450. The jury found that Long Trusts had breached the joint operating agreements by failing to pay ARCO in accordance with those agreements. Id. The court of appeals found that ARCO was entitled to attorney's fees "based upon the litigation of this portion of the suit," and thus, ARCO "prevailed under the terms of the contract." Id. We find that ARCO is factually dissimilar to this case and does not apply because appellees had not received any payments on their claim during the litigation of this suit.
Appellees further contend the contract contained an indemnity clause giving it a contractual basis to recover attorney fees. The contract contained an indemnity clause whereby both parties mutually agreed to indemnify the each other for any expense arising out of use of the property, as follows:
Both parties shall indemnify and hold each other harmless against any action, claim, liability, or expense arising out of each parties use of said property.
Appellees did not specifically plead this portion of the contract in their second amended petition, and pleaded only statutory recovery under section 38.001, Texas Civil Practice and Remedies Code. No jury issue was submitted on contractual recovery and none was requested, and no objection was made to the jury charge on these grounds. In its motion to disregard the findings of the jury, appellant did not ask the trial court to disregard the jury's finding of zero damages for Swink's breach of the contract, and grant a new trial on this issue. Appellees did not contend they had a contractual right to recover attorney's fees under the indemnity provision in the contract. Appellees contend for the first time on appeal, that they had a contractual right to recover on the indemnity clause in the contract. By failing to present this theory to the trial court, appellees have waived error on appeal on this issue. TEX. R.APP. P. 33.1(a) & 38.1(e),(h); First Financial Dev. Corp. v. Hughston, 797 S.W.2d 286, 295 (Tex.App.Corpus Christi 1990, writ denied). Because appellees failed to recover damages in their suit on a breach of contract under section 38.001, Texas Civil Practice and Remedies Code, they were not entitled to attorney's fees. Green, 951 S.W.2d at 390. Our finding is dispositive, and we need not address the rest of the subpoints under issue one of appellant's brief concerning appellees' attorney's fees. We sustain the contentions raised by appellant under subpoint one, that the trial court erred in granting appellees' motion to disregard the jury finding of zero attorney's fees for appellees. We reverse the judgment of the trial court, in the part that awarded appellees attorney's fees, and render judgment that appellees take nothing.
*111 Accordingly, we overrule appellees' conditional cross-points one and two contending appellees had established entitlement to attorneys' fees as a matter of law, and the jury's zero fact finding on appellees' attorney fees was against the great weight and preponderance of the evidence.
III. ELECTION OF REMEDIES.
In issue two, appellant contends the trial court erred when it required appellant to elect between the damages awarded by the jury for his breach of contract claim or damages awarded for his fraud claim. Appellant was awarded $1,500.00 for his breach of contract damages and $24,000.00 attorney fees for trial preparation, plus appellate fees. Appellant was also awarded $1,000.00 for his fraud claim. Swink contends that appellees represented that the foam business would clear $800.00 per month to induce him to buy the building. Swink contends this inducement was not in the written contract, and was fraud independent of the contract. Swink argued to the jury that he lost $19,000.00 in the foam business plus the $800.00 per month promised, which came to $38,000.00 for the 48 months Swink owned the business. Swink asked the jury to award him this $57,000.00 in damages for appellees' breach of the lease. He then asked the jury to award him a like amount of $57,000.00 because of appellees' fraud. The jury awarded Swink $1,500.00 for the breach of the contract and $1,000.00 for the fraud. This is a prohibited double recovery of damages for the same injury and the trial court did not err in requiring appellant to make an election of remedies. Waite Hill Services, Inc. v. World Class Metal Works, Inc., 959 S.W.2d 182, 184-85 (Tex.1998). "Appellate courts have applied the one satisfaction rule when the defendants commit the same act as well as when the defendants commit technically differing acts which result in a single injury." Id. at 185. Swink was injured when he suffered losses of $19,000.00 plus $38,000.00 in the monthly payments on the mortgage which appellees promised he would make when he bought the business. Swink offered no evidence of any distinct losses due to the fraud. He asked the jury to award him these same amounts for the contract breach and for the fraud, without distinguishing contract losses from fraud damages. We overrule Swink's contentions in issue two that the trial court erred in requiring him to elect to take his contract or fraud damages.
Because we have overruled Swink's contention of trial court error in requiring him to elect contract or fraud damages, we need not address appellees' cross-point three regarding their claim of factual insufficiency of the evidence to support the jury's finding of fraud. Appellees' cross-point three was conditioned upon our finding that the trial court erred in requiring Swink to elect, and we have affirmed the trial court's ruling as to this requirement of an election of remedies. Accordingly, we overrule appellees' cross-point three.
IV. APPELLEES' CONDITIONAL CROSS-POINTS.
We have considered and overruled appellees' cross-points one and two concerning appellees' entitlement to attorney's fees under our discussion under issue one concerning these fees. We have considered and overruled appellees' cross-point three claiming factually insufficient evidence to support the jury's finding on question number 6 under section III, above.
In cross-point four, appellees contend there was factually insufficient evidence to support the jury's findings in question 2 for zero damages for appellees on Swink's breach of the contract. When judgment n.o.v. is granted, the appellee may bring forward by cross-point any ground, including factual sufficiency, which would have vitiated the verdict or prevented an affirmance of the judgment. Tex.R. Civ. P. 324(c); Tex.R.App. P. 38.2(b). Kenneco Energy v. Johnson & Higgins, 921 *112 S.W.2d 254, 263-64 (Tex.App.Houston [1st Dist.] 1995), rev'd on other grounds, 962 S.W.2d 507 (Tex.1998); Winograd v. Clear Lake City Water Auth., 811 S.W.2d 147, 159 (Tex.App.Houston[1st Dist.] 1991, writ denied). The purpose of these rules is to require a final disposition of the case by the appellate court, where a judgment notwithstanding the verdict is erroneously rendered by the trial court, on the basis of the record before it, and to order a remand only as to questions that require the taking of additional evidence, such as jury misconduct. Jackson v. Ewton, 411 S.W.2d 715, 718 (Tex.1967). In considering a complaint of factual sufficiency, the reviewing court must consider and weigh all evidence and may set aside the verdict only if the findings are so against the great weight and preponderance of the evidence as to be clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986); Kenneco Energy, 921 S.W.2d at 264.
The contract provided that appellees were to receive 630 square feet of space in the warehouse for a period of five years. Appellees alleged that Swink told them they would have to leave or pay him $1,000.00 a month when appellees had 30 months left coming to them. The contract further provided that if Swink "sells or leases said building, the remaining months shall be calculated at" $250.00 per month payable to appellees. Appellees contended that their damages were the value of the use of the space for the 30 months left on the contract, and alleged $1,000.00 a month as damages. Mr. Behrend testified that when his business moved out of the warehouse, they did not "physically pay rent" for their new location, and any rent for their new location was an accounting transaction according to their CPA. Mr. Behrend could not produce any documents showing how much he lost as a result of the water being turned off, or the damages to their sign. Mr. Behrend testified that his attorneys calculated the $1,000.00 a month damages figure and he personally did not know what the damages actually were. Neither Mr. Behrend nor Mr. Alesi testified as to any money lost as a result of being evicted. Appellees' expert, Ken Pratt, testified that the rental value of the 630 square feet was about $185.00 to $215.00 per month, but there was no testimony from appellees that they lost any money by the eviction.
Appellees argument goes to the weight of the evidence and credibility of the witnesses. The jury could choose to believe all of the testimony, some of it, or none of it. The trier of fact is the sole judge of the credibility of the witnesses and the weight to be given their testimony. Roy v. Howard-Glendale Funeral Home, 820 S.W.2d 844, 849 (Tex.App.Houston[1st Dist.] 1991, writ denied). This Court may not substitute its opinion for that of the trier of fact merely because it might have reached a different fact conclusion. Id. We cannot say that a the jury's finding of no damages for appellees for Swink's breach of the contract is against the great weight and preponderance of the evidence. We overrule appellees' conditional cross-point of error number four.
IV. CONCLUSION.
We reverse that part of the judgment of the trial court awarding appellees attorney's fees in the sum of $35,710.00, and render judgment that appellees take nothing. We modify the trial court's judgment to add Rodger Swink's attorney's fees awarded for the prosecution of this appeal, as follows: Rodger Swink shall recover $24,000.00 attorney fees awarded for trial preparation plus $7,500.00 for the prosecution of this appeal, and costs as allowed by law. In all other respects, the judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1755095/ | 683 S.W.2d 140 (1984)
TEXAS A & M UNIVERSITY SYSTEM, Appellant,
v.
UNIVERSITY BOOK STORE, INC., et al., Appellees.
No. 10-84-088-CV.
Court of Appeals of Texas, Waco.
December 31, 1984.
Rehearing Denied January 24, 1985.
*141 Roger C. Clapp, Richards, Harris & Medlock, Dallas, Genevieve Graffeo Stubbs, College Station, Charles Black, Austin, for appellant.
Quinnan H. Hodges, Houston, for appellees.
HALL, Justice.
Texas A & M University is an institution of higher education under the management and control of the Board of Regents of appellant. The Texas A & M University System. V.T.C.A., Education Code § 86.02 and § 85.11. Appellant brought this appeal from an order of the trial court cancelling certificates of registration of five service marks issued by the Secretary of State to Texas A & M University. We reverse the judgment ordering cancellation, and we order the suit dismissed under the doctrine of sovereign immunity.
"Service mark" is defined in V.T.C.A., Bus. & C. § 16.01(a)(4)[1] to mean "a word, name, symbol, device, slogan or any combination thereof which, whether registered or not, has been adopted and used by a person to identify his services and distinguish them from the services of others, and includes the titles, designations, character names, and distinctive features of broadcast or other advertising." Section 16.02(b) of the Code provides that "A mark is considered to be used in this state in connection with services when (1) it is used or displayed in this state in connection with selling or advertising the services; and (2) the services are rendered in this State." Section 16.08(a) provides that such mark in actual use in connection with the applicant's services, which distinguishes his services from those of others, is registrable with the Secretary of State unless it falls within certain exceptions designated in the statute.
In 1980, with approval of appellant's Board of Regents, Texas A & M University determined to register with the Secretary of State as the University's service marks certain "emblems," "symbols," "designs," and "logos," as they are variously denominated by the parties throughout the trial, and then, after registration, to enter into a licensing program with manufacturers of consumer goods who place the marks on their products. The licensing agreements would require payment of royalties by the manufacturers to the University for use of the marks. Royalty revenues would be used as financial support for student affairs and activities not funded by the State.
In May and June, 1981, the University applied for and was granted certificates of registration by the Secretary of State of the following seven service marks being used by the University, as set forth in its application, in connection with its services as an "Institution of Higher Education":
Registration No. 38633 for "TEXAS AGGIES."
Registration No. 38634 for a large "T" with an "A" to the left and an "M" to the right ("ATM").
Registration No. 38635 for the four letters "TAMU" in sequence above the words "Texas A & M University."
Registration No. 38636 for the seal of Texas A & M University, a circle including the name Texas A & M University and the year 1876 with the letter T superimposed by a five pointed star surrounded by a wreath.
Registration No. 38720 for the words "Gig `Em Aggies" imposed upon a hand with closed fingers and an upturned thumb.
Registration No. 38721 for the Texas A & M University "ring crest," an oval with the words "Texas A & M University, 1876" around the edge with a spread eagle and shield at the center, used with or without class year or ATM symbol below the shield.
Registration No. 38722, for design only, for the drawing of a tough looking *142 army sergeant in campaign hat referred to as "Old Sarge."
The University applied for and received registration of these service marks under the Secretary of State's services class 41, "Education and Entertainment," authorized under Code § 16.09(c)(8).
Immediately after registration, the University began its licensing program with manufacturers, exacting royalties for use of the marks. The products upon which the manufacturers placed the marks are infinite in variety and include clothing, caps, tote bags, stationery, bric-a-brac, personal care items, etc.
Appellees are University Book Store, Inc., Loupot's Book Store, Texas Aggie Book Store, Rothers Book Store, and M & M Designs, Inc. With the exception of M & M Designs, appellees operate retail book stores near the University's campus in College Station. A great amount of the store sales of these parties involve products bearing the marks in question. M & M Designs, located in the City of Huntsville, is a manufacturer of decals and transfers and ceramic products bearing the marks.
Code § 16.16(a)(4)(B) provides that the Secretary of State shall cancel "a registration concerning which a district or appellate court has rendered a final judgment, which has become unappealable, cancelling the registration or finding that the registrant... is not the owner of the mark." Appellees filed this suit in August, 1981, seeking a declaration or finding by the trial court that appellant is not the owner of the service marks in questions (erroneously denominated "trademarks" in appellees' petition), an order cancelling the registrations, and an injunction permanently enjoining the University from licensing and collecting royalties for the use of the marks. Appellees expressly pleaded that they were not seeking money damages.
Appellant's answer included a motion to dismiss under the doctrine of sovereign immunity on the ground that appellant is an agent of the State and that this suit was brought by appellees without legislative consent or statutory authorization.
The case was tried to the court without a jury in October, 1983. At trial, appellees abandoned their suit for cancellation of the registration of the service marks involving the University seal and the design of the ring crest, but they continued in their petition for cancellation of the registrations involving the other marks. On March 7, 1984, judgment was signed by the trial court cancelling Registration Nos. 38720 ("Gig `Em Aggies"), 38722 ("Old Sarge"), 38633 ("TEXAS AGGIES"), 38634 ("ATM") and 38635 ("TAMU"). This judgment was based upon the trial court's finding that appellant "is not the owner of the described marks" because it has not used the marks, and the conclusion that "the certificates of registration should be cancelled pursuant to Art. 16.16(a)(4)(B), Tex.Bus. & C.Code." No injunctive relief was granted.
Appellant predicates this appeal on two grounds of error asserting (1) the trial court erred in failing to dismiss this suit on appellant's plea of sovereign immunity, and (2) the trial court's finding that appellant does not own the service marks because of lack of use is not supported by any evidence.
Although this suit was filed against appellant, it is a suit against the State of Texas, since appellant is an agent of the State. Walsh v. University of Texas, 169 S.W.2d 993 (Tex.Civ.App.El Paso 1942, writ ref'd). Under the rule of sovereign immunity, a suit brought to control State actions or to subject the State to liability is not maintainable without legislative consent or statutory authorization. Director, Etc. v. Printing Industries Ass'n, 600 S.W.2d 264, 265 (Tex.1980). This suit was filed by appellees without such legislative consent or statutory authorization to sue the State. Prior to the trial on the merits appellant moved for dismissal on the ground of sovereign immunity, citing appellees' lack of consent from the State to bring the suit. This motion was denied by the trial court by written order signed October 9, 1982. Appellant re-urged this motion at the beginning of the trial and it was *143 again denied by the court, orally. Although this interlocutory ruling was not expressly carried forward into the final judgment, we presume for purposes of this appeal that the trial court intended to, and did, rule on this issue against appellant in the final judgment. North East Independent School District v. Aldridge, 400 S.W.2d 893, 897-98 (Tex.1966).
It is also the rule that an entity or person whose rights have been violated by the unlawful action of a state official, may bring suit to remedy the violation or prevent its occurrence, and such suit is not a suit against the State requiring legislative or statutory authorization. Director, Etc. v. Printing Industries Ass'n, supra. Section 16.25(a) of the Code provides that a person who believes that he is or will be damaged by a registration under this chapter may sue to cancel the registration in a district court having venue. Appellees alleged in their petition that they had been and will be damaged by the University's registration of the marks in question and the resulting licensing program, and the trial court found this fact in appellees' favor. Since this finding has not been challenged by appellant as being without support in the evidence, we must presume it is correct. Crain v. Hill County, 613 S.W.2d 367, 369 (Tex.Civ.App.Waco 1981, writ ref'd n.r.e.). Arguing against appellant's claim of sovereign immunity, appellees assert that the University's registrations of the marks in question as its service marks are unlawful acts because the University is not the owner of the marks; and that rather than a suit seeking to control State actions, "this is a suit to remedy an invalid wrong against appellees and other citizens whose rights have been violated by unlawful or invalid actions of business persons employed by Texas A & M University," not requiring legislative or statutory authorization. We disagree with appellees' contentions that the University is not the owner of the service marks and that the registrations are unlawful or invalid acts.
The basic facts in the record are not disputed. Appellant obtained admissions of facts from appellees pursuant to Rule 169, Vernon's Tex.R.Civ.Proc., that: the University has used the marks which are the subject matter of this action in connection with higher educational services; that the University has the exclusive right to offer higher educational services using the marks which are the subject of this action; that the public associates the marks which are the subject of this action with the University; that consumers purchase goods bearing the marks which are the subject of this action in order to identify with the University; and that the University, "after adopting the service marks which are the subject of this action," has never ceased use of the marks for any period of time. These admissions were buttressed by testimony at trial from appellees' representatives to the effect that the University has used the marks; that the public associates the marks with the University; and that without this identification with the University the marks would have no value. Moreover, the certificates of registrations, the University's applications for the registrations with attached exhibits showing the University's use of the marks, all in evidence without objection, show use of the marks by the University for many years prior to the registrations on athletic uniforms, the football stadium, yell books, information brochures, University bulletins, magazines, stationery, and other campus literature. These exhibits show that the University's use of the mark "TEXAS AGGIES" began in 1920; that the use of the mark "Gig `Em Aggies" began in 1931; that the use of the mark "Old Sarge" began in 1939; and that the use of the marks "ATM" and "TAMU" began in 1965. The evidence shows that during this same time of use by the University, others, including manufacturers and retailers like appellees as well as individual students and graduates and their relatives and other friends of the University, have used these marks on various goods and products without objection from the University or appellant. Appellees argue that this coincident use of the marks by the University and the public broadly without objection from the University *144 denies the University and appellant any claim of ownership of the marks. However, there is no evidence rebutting the University's use of the marks in connection with its higher educational services, and there is no evidence that any other person or entity has used the marks in connection with higher educational services.
Section 16.15(c) of the Code provides that a certificate of registration issued by the Secretary of State "is admissible in evidence as prima facie proof of (1) the validity of the registration; (2) the registrant's ownership of the mark; and (3) the registrant's exclusive right to use the mark in commerce in this State in connection with the goods or services specified in the certificate, subject to any conditions and limitations stated in the certificate." Under the provisions of this statute the service mark registrations in evidence in our case carried rebuttable presumptions of the validity of the registrations, of the University's ownership of the service marks, and of the University's exclusive right to use the mark in connection with higher education services. There is no rebutting evidence in the record. But even if this statutory presumption is disregarded, the evidence conclusively established these facts in the University's favor notwithstanding it was appellees' burden in order to succeed to adduce proof disputing the University's ownership and right of use of the service marks.
Appellees also rely upon § 16.08(a)(5)(A) of the Code which provides that a mark otherwise entitled to registration is not registrable if it is "merely descriptive" of the applicant's services. We hold the marks in question are not descriptive of appellant's higher educational services. On their faces, they are not. Rather than describing the University's services, the marks in question identify and distinguish the source of those services. See Application of Marriott Corp., 517 F.2d 1364 (Cust. & Pat.App.1975); Application of Quik-Print Copy Shops, Inc., 616 F.2d 523 (Cust. & Pat.App.1980).
The University's licensing program is administered by its Director of Business Services, a department responsible for the non-educational "auxiliary" services at the University. The University had licensed 253 manufacturers at the time of trial. It does not license retailers, and it does not license manufacturers of educational materials. The licensing agreement used by the University refers to the marks as "trademarks and trade names." It purports to grant a nonexclusive license to the licensee to use the mark or marks licensed. The University represents in the agreement "that it is the owner of the trademarks and trade names and has the legal right to grant licenses therefor." The license is granted upon the payment of a royalty fee by the manufacturer to the University, normally 6% of the total net selling price of the products manufactured. The agreement reserves to the University the full ownership of the marks; the right of access to the licensee's books to verify sales and royalty computations; and the right to maintain "such reasonable quality, servicing, and manufacturing standards as may be prescribed by licensor." The University has not sought to license any appellee, and it has not threatened an appellee with any form of action in connection with its service marks or the licensing program. However, the University will not handle in its campus bookstore any merchandise bearing the marks that do not come from a licensed manufacturer.
Findings of fact and conclusions of law filed by appellees with the trial court to support the court's final judgment, which were adopted by the court, evidence that appellees abandoned their action for injunctive relief and sought the only relief granted them by the court, cancellation of the service mark registrations. In any event, independent issues of the validity of the licensing agreements and whether their use by the University should be enjoined are not before us, since appellees assert no complaint on appeal concerning the trial court's apparent denial of their plea for injunction.
*145 We agree with appellant and hold that there is no evidence supporting the trial court's finding that the University is not the owner of the registered service marks because it has not used the marks. Ordinarily, this ruling would require that we sustain appellant's second point of error and reverse the judgment and render judgment that appellees take nothing. However, it is our view and holding that appellees' suit to cancel the registrations is an attempt to control valid and proper state action that is not maintainable without the State's consent. Accordingly, we sustain appellant's first point of error and order the suit dismissed.
The judgment is reversed. This case is remanded to the trial court with instructions to dismiss the suit for want of jurisdiction.
NOTES
[1] All further Code references are to V.T.C.A., Bus & C. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1838304/ | 52 Mich. App. 360 (1974)
217 N.W.2d 429
KUNDE
v.
TEESDALE LUMBER COMPANY
Docket Nos. 16178, 16179.
Michigan Court of Appeals.
Decided March 28, 1974.
Reamon, Williams, Klukowski & Craft, for plaintiff.
Hillman, Baxter & Hammond (by Albert J. Russell and Robert N. Hammond), for defendants Teesdale Lumber Company and Employers Mutual Liability Company.
*362 Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and William J. Szykula and A.C. Stoddard, Assistants Attorney General, for the Second Injury Fund.
Before: LESINSKI, C.J., and HOLBROOK and BASHARA, JJ.
HOLBROOK, J.
On January 6, 1969, plaintiff was struck in the right eye by an object while he was cutting through rough lumber with a power saw in the defendant Teesdale Lumber Company's sawmill. In 1926 plaintiff had lost practically all the vision of his left eye as a result of an automobile accident. Owing to the work-related injury in January 1969, plaintiff lost approximately 85% of the visual capacity of his right eye. Plaintiff has, however, been fitted with a contact lens in the right eye and with it the loss of vision is only 35%. According to plaintiff's treating physician, the contact lens has been irritating plaintiff's eye, and consequently plaintiff has only been able to wear the lens two hours out of every day. Plaintiff filed a claim for workmen's compensation benefits, and after a hearing the hearing referee found that plaintiff's average weekly wage was $80 per week, that he had suffered the specific loss of his right eye, that he was not a part-time employee within the meaning of the compensation act, and that since he had already lost the specific use of one of his eyes the subsequent injury to his right eye qualified him for coverage by the Second Injury Fund under MCLA 418.521(2); MSA 17.237(521)(2).[1] Defendant Employers Mutual Liability Company appealed the finding of the average weekly wage and the finding that plaintiff was not a part-time *363 employee, and urged the affirmance of the finding that plaintiff suffered the specific loss of his right eye. Defendant Second Injury Fund appealed the finding that plaintiff was not a part-time employee, the finding of his average weekly wage, and the finding that plaintiff had lost the use of his right eye. The Workmen's Compensation Appeal Board (hereafter WCAB) affirmed the referee's finding with regard to the average weekly wage and plaintiff's status as a non-part-time employee. However, the WCAB reversed the referee's finding that plaintiff had lost the use of his right eye within the meaning of the compensation act. Plaintiff then filed an application for leave to appeal with this Court. The defendant insurer also sought leave to appeal raising the issue of whether plaintiff should properly be viewed as a part-time employee and also raising the issue of the specific loss of plaintiff's use of his right eye. We granted leave to appeal and now proceed to decide the issues raised.
I
Did the WCAB correctly construe MCLA 418.371; MSA 17.237(371)[2] pertaining to part-time employment in its determination of plaintiff's average weekly wage?
The portions of MCLA 418.371; MSA 17.237(371) pertinent to this appeal read as follows:
"(2) Average weekly wage means the weekly wage earned by the employee at the time of his injury, inclusive of overtime, premium pay, and cost of living adjustment, and exclusive of any fringe or other benefits which continue during disability, but in no case less than 40 times his hourly rate of wage or earning. When *364 it is found that the established normal work week for the employee's classification of employment in the establishment of the employer where the employee suffered a personal injury is less than 40 hours, then the average weekly wage shall be established by multiplying the employee's hourly rate or earning by the number of hours customarily worked in the employee's classification or employment in that place of employment or his actual earned wages, whichever is greater.
"(3) When a hearing referee finds that the employee was employed specifically and not temporarily on a part-time basis, the average weekly wage shall be determined by multiplying the hourly rate or earning by the average number of hours worked in the part-time employment. When it is found that the employee has worked an average of 25 hours or more per week in all of his current employments, he shall not be considered a part-time employee."
The hearing referee and the WCAB both agreed that plaintiff was not employed "specifically and not temporarily on a part-time basis" within the meaning of (3) above. Plaintiff was employed on a work-available basis and there was no evidence of an agreement to limit the hours plaintiff was expected to work. Therefore, the WCAB could properly have found that (3) was inapplicable and that plaintiff was not a part-time employee. Absent fraud this Court may not disturb findings of fact made by the WCAB. Carter v Kelsey-Hayes Co, 386 Mich. 610; 194 NW2d 326 (1972); Const 1963, art 6, § 28; MCLA 418.861; MSA 17.237(861).[3]
Having concluded that plaintiff was not a part-time employee, the WCAB applied the first sentence of (2) in MCLA 418.371; MSA 17.237(371) quoted above to determine plaintiff's average weekly wage. The WCAB apparently found the second sentence of (2) inapplicable in the determination *365 of plaintiff's average weekly wage because there was no argument made by the defendants that plaintiff belonged to an "employee's classification of employment" which was less than 40 hours. We find no error in the WCAB's factual determination of the average weekly wage of the plaintiff under these circumstances.
II
Was the WCAB correct in determining that plaintiff had not sustained a specific loss of his right eye as a result of his accident by judging his loss on the basis of his corrected vision rather than natural vision?
The WCAB claims that Michigan case law establishes that the loss of vision in plaintiff's right eye should be determined upon the basis of his vision as corrected through the use of a contact lens. The WCAB asserts that the plaintiff can compute his loss of vision upon the basis of his eyes in their natural state only if the lens in the injured eye has been surgically removed. The board cited Lindsay v Glennie Industries, Inc, 379 Mich. 573; 153 NW2d 642 (1967), for this rule and then distinguished the facts of this case from Lindsay. We disagree with the ruling of the WCAB. In Lindsay the Supreme Court rejected Cline v Studebaker Corp, 189 Mich. 514; 155 N.W. 519 (1915), wherein the majority held that in an application for the determination of the specific loss of an eye under the Workmen's Compensation Act the proper test was to measure the degree of vision and coordination after the application of the prosthesis. The Lindsay Court went on to say at 379 Mich. 578; 153 NW2d 644:
"We treat this case as one of first impression. We *366 hold the surgical removal of the natural lens made necessary by an injury arising out of and in the course of claimant's employment is loss of an eye within the meaning of the amended statute.
"We recognize that substituting an artificial lens has `restored' vision to the otherwise sightless eye. We point out that a specific loss award is not made as compensation for diminution of use of the involved organ or member. It is not awarded to compensate for loss of earnings or earning capacity. It is awarded irrespective of either fact or both. If ophthalmological advances and refinements in the use of contact lens has in fact rendered the amended statute inconsonant with its original legislative intent, it is the province of the Legislature to say so. We construe the statute in the plain meaning of its wording."
The WCAB mistakenly construed Lindsay to mean that there could be no finding of specific loss of an eye unless surgical removal of the natural lens of the eye had occurred. This construction of Lindsay is much too narrow. In Hutsko v Chrysler Corp, 381 Mich. 99, 102-103; 158 NW2d 874, 876 (1968), the Supreme Court in dicta clearly outlined what proofs were needed to show a specific loss of a body member for compensation purposes:
"However, in order to qualify for the specific loss payment where there has not been the actual physical loss of the member as by amputation, there must be that total incapacitating loss of use which renders the organ or member industrially useless for any type of work, skilled or unskilled. To hold otherwise we think would be a logical contradiction. Plaintiff's injury has not amounted to the actual physical loss tantamount to destruction or amputation contemplated by the specific loss schedule. The test is not the degree of loss measured by the requirements of the skill of the injured workman. The test is the degree of loss as compared with the actual physical loss by destruction or amputation. We hardly need add that where the specific loss schedule makes an exception as in the case of an eye, *367 the percentage of loss legislatively specified obtains." (Emphasis supplied.)
Nothing in MCLA 418.361; MSA 17.237(361),[4] requiring 80% loss of vision for a finding of the specific loss of an eye, says that the vision loss is measured under corrected, rather than natural, conditions. Recently in Hilton v Oldsmobile Division of General Motors Corp, 390 Mich. 43; 210 NW2d 316 (1973), the Supreme Court reaffirmed its ruling in Lindsay quoted above. In Hilton Justice COLEMAN dissented on the grounds that Lindsay ignored established precedent and that the focus of the inquiry should be on the injured employee's loss of vision as corrected. Under this standard since plaintiff's loss of sight when corrected by a contact lens is only 35% there would be no specific loss of an eye within the terms of MCLA 418.361; MSA 17.237(361), requiring 80% loss of vision. Justice COLEMAN'S view did not prevail, however. The mere fact that both Hilton and Lindsay dealt with surgical removal of the natural lens of the eye does not require a different result than we reach in this case where there was permanent corneal scarring to such an extent that 85% of the vision of plaintiff's right eye was lost. The scarring is so closely equivalent in effect to the removal of a lens it would be unreal to distinguish them for compensation purposes. For substantial support of this holding in many cases from other jurisdictions, see 2 Larsen's Workmen's Compensation Law, § 58.10, pp 88.50-88.51, and the 1973 cumulative supplement thereto.
III
Is the July 1, 1968 amendment of MCLA 412.9; *368 MSA 17.159[5] unconstitutional as violative of plaintiff's right to equal protection of the laws?
Plaintiff did not raise this issue on his application for leave to appeal. Normally this would preclude our consideration of the question. Louagie v Merritt, Chapman & Scott, 382 Mich. 274; 170 NW2d 13 (1969). Since, however, it is a constitutional question apparently of first impression in this state we have exercised our discretion and proceed to analyze the problem with a desire of settling the issue for future cases.
Prior to July 1, 1968, MCLA 412.9; MSA 17.159 read in pertinent part as follows:
"Any permanently and totally disabled person as defined in this act who, on or after June 25, 1955, is entitled to receive payments of workmen's compensation under this act in amounts per week of less than is presently provided in the workmen's compensation schedule of benefits for permanent and total disability and for a lesser number of weeks than the duration of such permanent and total disability shall after the effective date of any amendatory act, by which his disability is defined as permanent and total disability or by which the weekly benefit for permanent and total disability is increased, receive weekly, without application, from the second injury fund, an amount equal to the difference between what he is now or shall hereafter be entitled to receive from his employer under the provisions of this act as the same was in effect at the time of his injury and the amount now provided for his permanent and total disability by this or any other amendatory act with appropriate application of the provisions of paragraphs (b), (c), (d) and (e) of this section since the date of injury. Payments from this second injury fund shall continue after the period for which any such person is otherwise entitled to compensation under this act for the duration of such permanent and total disability according to the full rate *369 provided in the schedule of benefits." (Emphasis supplied.)
The statute was amended by 1968 PA 227, effective July 1, 1968, and by virtue of the amendment was altered and placed in a new section of the Workmen's Compensation Act, to become MCLA 417.53; MSA 17.230(103).[6] For the purposes of this case the material change made by the 1968 amendment was that the phrase "according to the full rate provided in the schedule of benefits" was deleted from the statute.
In King v Second Injury Fund, 382 Mich. 480; 170 NW2d 1 (1969), the Supreme Court held that the "full rate" contemplated in MCLA 412.9(a); MSA 17.159(a), prior to the 1968 amendment meant that the limitation of weekly benefits to 66 2/3% of the employee's average weekly wage at the time of the injury applied only to the employer and not to the Second Injury Fund, since to retain the 66 2/3% limitation in such cases would defeat the theory underlying the creation of the Second Injury Fund. The alleged effect of the 1968 amendment is that those employees totally and permanently disabled prior to July 1, 1968, are, in accordance with King, paid at the full rate as provided in the schedule of benefits, but those injured after July 1, 1968, are paid only 66 2/3% of their average weekly wages. This is the interpretation given the statute by the Attorney General and the Second Injury Fund. OAG, 1969-1970, No 4711, p 187 (November 9, 1970). Apparently, it is also the view of the WCAB, which stated in its opinion:
"The above being our finding, we shall not here act upon the referee's awarding of maximum rates payable by the Second Injury Fund for an injury which occurred *370 after 1968 PA 227 which amendment would appear to bar such awards."
The effect on the plaintiff of the above statutory interpretation is that his total benefits to be received from the Second Injury Fund will be limited to 66 2/3% multiplied by his average weekly wages of $80 per week, or $53.33 per week. Had he been injured prior to July 1, 1968, he would have been entitled to the "full rate" from the Second Injury Fund, without regard to the 66 2/3% limitation, as was mandated by King, supra. Plaintiff claims such disparate treatment accorded employees injured after July 1, 1968, as opposed to that awarded those injured before July 1, 1968, violates his constitutional guarantee to equal protection of the laws.
In the area of social welfare legislation as long as the legislative classification is reasonably related to the purpose of the statute enacted, there is no violation of constitutional principles of equal protection of the laws. Richardson v Belcher, 404 U.S. 78; 92 S. Ct. 254; 30 L. Ed. 2d 231 (1971); Pusquilian v Cedar Point, Inc, 41 Mich. App. 399; 200 NW2d 489 (1972); Verberg v Simplicity Pattern Co, 357 Mich. 636; 99 NW2d 508 (1959). In Verberg the Supreme Court held that differential benefits from the Second Injury Fund payable only to those totally and permanently disabled within the section of the Workmen's Compensation Act defining total and permanently disability to mean only specific losses or injuries, and not to others permanently and totally disabled as a matter of fact, did not establish an unreasonable classification in the constitutional sense. As in Verberg, we see nothing so palpably arbitrary and unreasonable as to be constitutionally defective in the legislative classification drawn here which results in different compensation treatment accorded employees *371 injured before as opposed to those injured after July 1, 1968. There are potentially many rational reasons why the Legislature constructed the classification it did. It may have anticipated the King, supra, ruling and its effects, and thus sought to equalize the compensation responsibility owed by employers and the Second Injury Fund. It may have felt that any added burden placed on the Second Injury Fund by requiring it to pay the full rate as set out in the schedule of benefits might damage the fund, and thus destroy its effectiveness. The existence of any state of facts that can be reasonably conceived must be assumed in order to sustain a legislative classification as constitutional. Verberg, supra; People v Raub, 9 Mich. App. 114; 155 NW2d 878 (1967); Alexander v Detroit, 45 Mich. App. 7; 205 NW2d 819 (1973). To suggest, as plaintiff implicitly does here, that those injured after July 1, 1968, must always receive identical compensation benefits as those injured before that date ignores the possibility that compensation needs may change over time. Rights to benefits under the Workmen's Compensation Act are purely statutory. Thus, the Legislature has the prerogative to redefine the extent of those benefits. We do not view Gallegos v Glaser Crandell Co, 388 Mich. 654; 202 NW2d 786 (1972), cited by plaintiff on appeal as sufficiently analogous either in its facts or law to require a result different than the one we reach. We find nothing constitutionally deficient in the legislative classification in issue here.
Reversed with instructions to reinstate the hearing referee's finding that the plaintiff has suffered the specific loss of his right eye and to make an appropriate compensation award consistent with this opinion. Costs to plaintiff.
All concurred.
NOTES
[1] Formerly MCLA 417.53; MSA 17.230(103).
[2] Formerly MCLA 412.11; MSA 17.161.
[3] Formerly MCLA 413.12; MSA 17.186.
[4] Formerly MCLA 412.10; MSA 17.160.
[5] Now MCLA 418.351, 418.353, 418.355, 418.357, 418.359; MSA 17.237(351), 17.237(353), 17.237(355), 17.237(357), 17.237(359).
[6] See footnote 1. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1722398/ | 723 So. 2d 474 (1998)
Aubrey LeCOMPTE, Melissa Foor LeCompte, and Rochelle Ellen LeCompte
v.
STATE of LouisianaDEPARTMENT OF HEALTH AND HUMAN RESOURCESSOUTH LOUISIANA MEDICAL CENTER and Dr. Robert Cazayoux and Dr. John R. Landry and Dr. E. Hayes and Drs. John Doe and Nurses Jane Doe.
No. 97 CA 1878.
Court of Appeal of Louisiana, First Circuit.
September 25, 1998.
*475 John D. Rawls, Judith A. Gic, New Orleans, for Plaintiffs-Appellants Aubrey Le-Compte, et al.
James H. Gibson, Lafayette, for Defendants-Appellees State of LouisianaDepartment of Health and Human Resources, et al.
Franklin D. Beahm, Metairie, for John R. Landry, M.D.
BEFORE: FITZSIMMONS and GUIDRY, JJ., and CHIASSON, J. Pro Tem.[1]
GUIDRY, J.
Plaintiffs, Aubrey LeCompte and Melissa Foor LeCompte, individually and on behalf of their minor daughter, Rochelle LeCompte, appeal from a judgment dismissing their *476 medical malpractice claim against defendants, the Department of Health and Human Resources, a Division of the State of Louisiana; South Louisiana Medical Center; and Dr. Eric Hayes. We affirm.
BACKGROUND
On October 13, 1988, plaintiffs, Aubrey LeCompte (Mr. LeCompte) and Melissa Foor LeCompte (Mrs. LeCompte), individually and on behalf of their minor daughter, Rochelle LeCompte, filed a petition for damages, naming as defendants: the State of Louisiana, Department of Health and Human Resources, South Louisiana Medical Center, and Dr. Eric Hayes, the obstetrician who delivered Rochelle (collectively referred to as "defendants").[2] Plaintiffs allege that during the birth of Rochelle, the defendants deviated from the acceptable standard of care, and as a direct result, the defendants caused Rochelle to develop cerebral palsy. Defendants filed an answer, generally denying plaintiffs' allegations.
Defendants filed a peremptory exception pleading the objection of prescription, alleging that prescription commenced seven months after the birth of Rochelle, and plaintiffs' suit was not filed within the one-year prescriptive period. A hearing on the peremptory exception was held on April 25, 1997. Following this hearing, the trial court rendered a judgment in favor of the defendants, finding that plaintiff's medical malpractice claim had prescribed. Plaintiffs now appeal.
PRESCRIPTION
Plaintiffs argue that the trial court erred in finding that their claim had prescribed prior to the filing of their petition. Plaintiffs assert that they did not become aware of their medical malpractice claim until Mrs. LeCompte saw a television commercial in which an attorney indicated that doctors sometimes cause cerebral palsy, and this did not occur until sometime during the period of time between October 1987, and May 1988. However, defendants contend that plaintiffs' claim is untimely because Mrs. LeCompte became aware of her medical malpractice claim in May 1986, when Rochelle was diagnosed with cerebral palsy.
Actions for medical malpractice prescribe one year from the date of the alleged act of malpractice or within one year from the date of the discovery of the alleged act. See LSA-R.S. 9:5628. However, all actions must be brought within three years from the date of the alleged act or they are forever barred. See LSA-R.S. 9:5628. The central issue for this court to determine is what date the plaintiffs had actual or constructive knowledge sufficient to begin the running of the prescriptive period on their medical malpractice claim against the defendant.
Generally, prescription commences when plaintiff has "actual or constructive knowledge of the tortious act, the damage and the causal relation between the tortious act and the damage." Sartin v. St. Paul Fire and Marine Insurance Co., 359 So. 2d 649, 651 (La.App. 1st Cir.1978), quoting Duhon v. Saloom, 323 So. 2d 202, 204 (La.App. 3rd Cir.1975), writ refused, 325 So. 2d 794 (La.1976). When a party has sufficient information to incite curiosity, to excite attention, or to put a reasonably minded person on guard and call for inquiry, he or she has the constructive knowledge necessary to start the running of prescription. Tilley v. Kennedy, 605 So. 2d 226, 228 (La.App. 2nd Cir. 1992).
Realizing the aforementioned constraints of the law, it is incumbent upon this court to closely review the relevant facts in light of whether they would have put a reasonable person on notice of a medical problem. The evidence reveals that Melissa Le-Compte, in addition to consuming alcohol, smoked cigarettes and marijuana during her pregnancy. Mrs. LeCompte received prenatal care on three occasions during her pregnancy. She was admitted to South Louisiana Medical Center on October 13, 1985, despite the fact that her water broke approximately 24 hours earlier. She experienced *477 no labor pains during the entire labor. Labor was eventually induced and Rochelle Le-Compte was born on October 14, 1985. Immediately following Rochelle's birth, she went limp and a pediatrician was called in to resuscitate and intubate Rochelle. According to Mrs. LeCompte, everyone in the delivery room "hovered" around Rochelle and then abruptly left the room after her birth. Mrs. LeCompte stated that because of her physical position at that time, she was unable to see exactly what was going on with Rochelle. Rochelle was subsequently hospitalized for a period of eleven days at which time Mrs. LeCompte was informed that she had given birth to a premature baby who was in guarded condition due to the presence of respiratory distress and the later development of hyperbilirubinemia and pneumonia. We find solace in our conclusion that the LeCompte's knew that something had gone wrong during the birth of their daughter and that whatever it was continued to be a problem, at least during the time she was hospitalized. However, mere apprehension that something might be wrong is insufficient to commence the running of prescription unless plaintiff knew or should have known by exercising reasonable diligence that there was a reasonable possibility that his or her problem may have been caused by acts of malpractice. Cordova v. Hartford Accident & Indemnity Company, 387 So. 2d 574, 577 (La.1980). Even if a malpractice victim is aware that an undesirable condition developed at some point in time after the medical treatment, prescription does not run as long as it was reasonable for the victim not to recognize that the condition may be related to the treatment. The proper focus is on the reasonableness of the tort victim's action or inaction, in light of the facts known to them, or which should have been known to them. We must, therefore, determine the point at which plaintiffs became aware of sufficient information to call for inquiry regarding the possibility of a medical malpractice claim. Noting the complexity of making such a determination, we rely upon the guidance of the court in Harlan v. Roberts, 565 So. 2d 482, 486 (La.App. 2nd Cir.), writ denied, 567 So. 2d 1126 (La.1990) which wisely stated:
When a plaintiff has knowledge of facts strongly suggestive that the untoward condition or result may be the result of improper treatment and there is no effort by the health care providers to mislead or cover up information which is available to plaintiff through inquiry or professional medical or legal advice, then the facts and the cause of action are reasonably knowable to plaintiff. Inaction by the plaintiff for more than a year under these circumstances is not reasonable.
In May 1986, when Rochelle was seven months old, she was diagnosed with cerebral palsy. Unfortunately, the record fails to educate the court on the condition of Rochelle from two weeks after birth until this diagnosis at seven months. The absence of this information places this court at a disadvantage in trying to reach a just decision. This knowledge would certainly have made this task less difficult. Nevertheless, upon diagnosis, Mrs. LeCompte was informed that generally, cerebral palsy is caused by a lack of oxygen to the brain at birth. The physician did not inform Mrs. LeCompte as to the exact cause of Rochelle's cerebral palsy, and she did not ask him. The next form of information available to the plaintiffs was Rochelle LeCompte's birth certificate which indicated the presence of congenital malformations or abnormalities, identified as Preterm Respiratory Distress Syndrome, and further noted there existed complications of labor. Finally, in addition to these post-birth warnings is the fact that a half brother of Aubrey LeCompte has cerebral palsy. We feel this should have given the plaintiffs the requisite basis for inquiry regarding the possibility of a medical malpractice claim.
This court has previously stated that facts such as a patient's educational background, intelligence, and past experiences with medical procedures may be considered in determining whether or not he had knowledge of a potential malpractice claim. Lambert v. Metrailer, 485 So. 2d 69, 71 (La.App. 1st Cir.) writ denied, 488 So. 2d 1023 (La.1986). Aubrey and Melissa LeCompte, using this logic, attempt to negotiate the "reasonableness" standard previously enunciated by profiling themselves as persons of minimal and questionable *478 competence. However, we do not associate one's failure to satisfy high school requirements with the inability to do so, absent evidence in support of such a contention.
Melissa LeCompte has demonstrated the faculties necessary to obtain a G.E. D.; enter beauty school; maintain independent living since the age of sixteen, both in and out of state; maintain a number of jobs; effectively communicate her medical needs and history upon arrival at the hospital; and to respond without assistance to challenging inquires at her deposition. In one instance, she even displayed sufficient intellect to quiz the defendants' attorney on the importance of a question asked of her. Aubrey Le-Compte negotiated entry into the United States Army, which requires a showing of competency; received an honorable discharge upon exiting; and maintained independent living in a number of states. He testified that his failure to complete school was because he did not go back for his senior year, a voluntary act in our opinion. There is no evidence in the record that either plaintiff had any disability or limitation which would have precluded them from acting timely. Having considered this argument, we point out that one may not escape the commencement of prescription by attempting to establish that their ability to comprehend and evaluate the facts is inferior to that possessed by a reasonable man. Taussig v. Leithead, 96-960 (La.App. 3 Cir. 2/19/97), 689 So. 2d 680, 684 (quoting Norwood v. Fish, 537 So. 2d 783 (La.App. 2nd Cir.) writ denied, 539 So. 2d 634 (La.1989)). We note that the correct standard is whether the reasonable person would have or should have discovered facts sufficient to hail the alleged wrongdoing in the same circumstances.
In Griffin v. Kinberger, 507 So. 2d 821 (La.1987), the court determined that the point at which an eighteen-year old mother with a sixth grade education was reasonably alerted of the possible cause of action was when she read a newspaper article informing her of such. In this instance, the court suspended the prescriptive period during the time the cause of action was not known or reasonably knowable to this mother. What is highly distinguishable about this case is the absence of any cause for alarm at the birth of the child. Additionally, this mother, with less education than the plaintiffs, made repeated inquires of physicians who assured her that her child's eye condition was a natural and expected consequence of the necessary administration of oxygen to premature children at birth. The court held that prior to the diagnosis, plaintiffs had no reason to relate the child's eye problems to any malpractice on the part of the doctors, especially since the doctors told them this was a normal result of the treatment the child received.
In Maung-u v. May, 556 So. 2d 221 (La. App. 2nd Cir.) writ denied, 559 So. 2d 1385 (La.1990), a child suffered asphyxia at birth and was later placed in critical condition following the birth. In months following the delivery, the plaintiffs learned of problems and delays in development which the child was experiencing; however, they were cautioned to wait for certain landmark dates prior to a final decision being made as to the child's condition. Within months of the child being diagnosed with cerebral palsy, the plaintiffs initiated a malpractice lawsuit. The court held that the plaintiff was aware of the difficulty of the child, the abnormal labor and delivery problems and the umbilical cord around the neck of the child at the time of delivery. Based upon these facts, the court stated that the plaintiff was not reasonable in failing to bring their action over two years from the night of delivery.
In Poole v. Physicians & Surgeons Hospital, 516 So. 2d 1185 (La.App. 2nd Cir.1987) writ denied, 519 So. 2d 127, 128 (La.1988), the mother of a baby who had suffered birth trauma was informed by a physician that there had been considerable improvements in the child's condition but a determination of brain damage was later made. This mother followed-up with tests at three-month intervals but was assured that an accurate diagnosis could not be determined until later in time. The court determined that the plaintiff did not have actual or constructive notice of their medical malpractice action prior to one year before institution of the suit because no health care worker ever made any suggestion of negligence to her, despite a diligent effort to ascertain the nature of her *479 child's illness. This is distinguishable from the case at hand because the record is void of evidence that the plaintiffs made any effort to obtain any medical care for their baby prior to diagnosis.
In Richardson v. Moffett, 608 So. 2d 275 (La.App. 3rd Cir.1992) writ denied, 612 So. 2d 81 (La.1993), in arguing against an exception of prescription, plaintiffs maintained that the prescriptive period did not begin to run until the date a diagnosis was made that their son had cerebral palsy, or following that when an attorney first reviewed the medical records. In affirming the Trial Court's dismissal of the action based upon the one year prescriptive period provided by La. R.S. 9:5628, the Court pointed out that plaintiffs were aware of the pertinent facts on the night of delivery. The court also rejected plaintiffs argument that suit may be brought one year from the date their child was diagnosed as suffering from cerebral palsy.
Plaintiffs rely heavily on the recent third circuit decision of Quibodeaux v. Medical Center of Southwest Louisiana, 97-204 (La. App. 3rd Cir.3/16/98), 707 So. 2d 1380. The instant case is distinguishable from Quibodeaux in that the court in Quibodeaux places great weight on the fact that parts of the alleged malpractice occurred out of plaintiff's view. In the instant case, Melissa LeCompte was present at the birth of her daughter. According to Mrs. LeCompte, everyone in the delivery room "hovered" around Rochelle and then abruptly left the room after the birth. She testified that she could not see exactly what was going on but she admits she saw the activity. In Quibodeaux, Mrs. Quibodeaux could not see any activity that was substantially suspect and that should have alerted her to the possibility of malpractice. The same cannot be said of Mrs. LeCompte.
The burden of proof generally rests upon the party pleading prescription as an affirmative defense. Where, however, plaintiff's petition shows on its face that the asserted claim has prescribed, plaintiff bears the burden of proving interruption or suspension of prescription sufficient to bring the action within the prescriptive period. Abrams v. Herbert, 590 So. 2d 1291, 1297 (La.App. 1st Cir.1991) (quoting Hunter v. Sisters of Charity of Incarnate Word, 236 So. 2d 565, 567 (La.App. 1st Cir.1970)). We point out that in the evaluation of the issue of prescription the courts have repeatedly stated that the focal point of inquiry is on the question of whether the cause of action was known or reasonably knowable by the plaintiffs. Richardson v. Moffett, 608 So. 2d 275, 277 (La.App. 3rd Cir.1992). We find a frightening lack of diligence on the part of the plaintiffs in seeking to determine whether or not they had a cause of action for medical malpractice. Accordingly, they have failed to meet their burden of proving otherwise.
From our examination of the record, it is apparent that all of the facts alleged in the plaintiffs' petition were known to them on the night of the delivery. Despite the plaintiffs having knowledge of the complications of the birth, the extensive treatment of the child at the hospital, the child having been diagnosed with cerebral palsy, and the possible causal relationship between cerebral palsy and the birthing process, no action was filed until one day short of three years following the birth of the child and more than twenty-nine months following the cerebral palsy diagnosis. When considering the totality of the circumstances, it is our view that the Le-Comptes had sufficient information to incite curiosity or to excite attention and call for inquiry in a timely fashion. We further find that the afterbirth complications with Rochelle coupled with the general statement by a physician as to the cause of cerebral palsy provided the LeComptes with constructive knowledge to start the running of prescription in May 1986. In addition, we find no evidence indicating that the LeComptes' background or level of intelligence prevented them from inquiring into the existence of their medical malpractice cause of action until Mrs. LeCompte was informed by a commercial advertisement that doctors are sometimes the cause of cerebral palsy. Ignorance of their daughter's condition was the product of their own neglect. Thus, we conclude that plaintiffs' medical malpractice claim filed on October 13, 1988, which was more than two years after May 1986, has prescribed.
*480 CONCLUSION
In the absence of manifest error, the trial court's judgment, maintaining defendants' peremptory exception pleading the objection of prescription, is affirmed. Costs of this appeal are assessed to the plaintiffs.
AFFIRMED.
CHIASSON, J., concurs.
NOTES
[1] Judge Remy Chiasson, retired, is serving as judge pro tempore by special appointment of the Louisiana Supreme Court.
[2] Dr. John R. Landry and Dr. Robert Cazayoux, obstetricians who provided Mrs. LeCompte with prenatal treatment on two occasions, were also named as defendants but were later dismissed from the suit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4511782/ | COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
DONNIE RAY PEOPLES, § No. 08-19-00305-CR
Appellant, § Appeal from the
v. § 143rd District Court
THE STATE OF TEXAS, § of Ward County, Texas
Appellee. § (TC# 19-10-25229-CVW)
MEMORANDUM OPINION
Appellant Donnie Ray Peoples has filed a motion to withdraw his appeal, stating that he
no longer wishes to proceed with his appeal. We construe this as a motion to voluntarily dismiss
his own appeal. The Court grants Appellant’s motion and dismisses this appeal. See
TEX.R.APP.P. 42.2 (governing voluntary dismissals in criminal cases).
JEFF ALLEY, Chief Justice
February 27, 2020
Before Alley, C.J., Rodriguez, and Palafox, JJ.
(Do Not Publish)
1 | 01-03-2023 | 03-02-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1365808/ | 557 S.E.2d 420 (2001)
253 Ga. App. 43
RAPID GROUP, INC.,
v.
YELLOW CAB OF COLUMBUS, INC.
No. A01A1363.
Court of Appeals of Georgia.
November 29, 2001.
Reconsideration Denied December 14, 2001.
*422 David A. Webster, Atlanta, for appellant.
Taylor W. Jones & Associates, Taylor W. Jones, Atlanta, Richard E. Harris, Norcross, for appellee.
*421 POPE, Presiding Judge.
In general, legal malpractice liability attaches when an attorney fails to apply well-settled legal principles or procedures. In this case, the attorney representing a taxicab company allegedly failed to assert the well-known independent contractor defense to a claim of respondeat superior for a cabdriver's tort. But the malpractice defendants argued that it is also well settled that the independent contractor defense did not apply to the facts of the case. They relied on Yellow Cab of Chatham County v. Karwoski, 226 Ga. App. 63, 486 S.E.2d 39 (1997), which was decided three years after the alleged legal malpractice. Thus, one of the questions presented by this appeal is does Karwoski reiterate well-settled law or break new ground.
In 1992, Stephens, a driver for Yellow Cab of Columbus, Inc., had an accident in Columbus that injured Lester and Tina Howard. At the time of the accident, Stephens had a Columbus taxicab driver's permit but not a Columbus taxicab business license. Stephens had a business relationship with Yellow Cab, described by Yellow Cab as one of dispatch service and independent contractor. The Howards sued Stephens in tort, and Yellow Cab under the doctrine of respondeat superior. Rapid Group, Inc. insured Yellow Cab, and it provided a defense using attorney Sidney Moore.
In 1994, during the litigation, Moore allegedly committed malpractice in several ways including failing to respond to discovery, which resulted in a default judgment. After a trial on damages, a judgment in the amount of $101,000 was entered against Yellow Cab. Yellow Cab sued Moore and Rapid Group for legal malpractice alleging in part that the default judgment precluded it from raising the defense that Stephens was an independent contractor. Moore and Rapid Group attempted to rely on Karwoski and argued that Stephens was Yellow Cab's employee as a matter of law and, therefore, Yellow Cab would have been liable regardless of the default judgment.
But, because the decision in Karwoski was issued three years after the alleged malpractice occurred, the trial court did not charge Karwoski to the jury, did not allow the defendants to argue Karwoski, and would not grant a directed verdict and rule as a matter of law that Karwoski applied to the facts of this malpractice case. At the end of the trial, the jury ruled in favor of Yellow Cab and awarded damages and attorney fees totaling $244,431 for the malpractice. Rapid Group appeals.
1. In its first three enumerations, Rapid Group contends, in essence, that the trial court prevented it from fully asserting its defense that Yellow Cab employed the driver and therefore would have been liable as a matter of law in the tort action even if there had been no default judgment. Rapid Group based its defense on Karwoski, which suggests that the driver was Yellow Cab's employeenot an independent contractoras a matter of law, because he did not have a taxicab owner's business license as required by an applicable Columbus municipal ordinance. See Karwoski, 226 Ga.App. at 67-69, 486 S.E.2d 39 (on motion for reconsideration). Rapid Group contends that Karwoski did not change the law, but simply articulated what had always been the law, and therefore, *423 the trial court erred by not applying it to the case.[1]
In numerous cases dating back to at least 1939, this Court has repeatedly held that, for the purposes of determining employer liability under the Georgia Workers' Compensation Act, OCGA § 34-9-1 et seq., a taxicab company is estopped to deny that an affiliated driver is an employee (and claim that he is an independent contractor) when local ordinances either directly or indirectly prohibit the use of independent contractors, or the independent contractor himself is not fully and properly licensed and operating in compliance with the local ordinances. See Karwoski, 226 Ga.App. at 63, 486 S.E.2d 39, and cases cited therein; Aetna Cas. &c., Co. v. Prather, 59 Ga.App. at 797(1), 2 S.E.2d 115 (1939).[2] For the purposes of this decision, the application of a local ordinance to determine employee/independent contractor status will be referred to as the local ordinance rule.
The issue in this case is whether it was well settled in 1994, the time of the alleged malpractice, that the same local ordinance rule applied in a tort case. This Court's decision in Karwoski purports to hold that it does. See Karwoski, 226 Ga.App. at 67-69, 486 S.E.2d 39. (on motion for reconsideration). But there are four reasons for concluding that Karwoski represents a change in the law and not simply an articulation of what had always been the law.
First and foremost, the opinion in Karwoski itself reveals that application of the local ordinance test to tort cases was strongly debated and that the law had previously been unclear. Karwoski was a workers' compensation case. The original opinion only addressed whether the local ordinance rule should apply to the specific facts of the case. Id. at 63-65, 486 S.E.2d 39. On a motion for reconsideration, the Court went further. The taxicab company in Karwoski suggested that the original opinion was inconsistent with Smith v. Yellow Cab Co. of Chatham County, 223 Ga.App. 143, 476 S.E.2d 887 (1996). In that tort action, this Court refused to apply the local ordinance rule to tort actions and instead applied the well-known law that the question of whether one is an employee or an independent contractor is resolved by determining whether the employer retains the right to exercise control over the time, manner and method of the work performed. Id. at 144, 476 S.E.2d 887.
In response to the motion for reconsideration, in a five-to-four decision, this Court overruled Smith and held that the local ordinance test applies to both tort and workers' compensation actions. In so doing, the majority acknowledged that the case law had "become blurred and confused" and that the cases "generally divide into two lines: those tort cases involving the doctrine of respondeat superior and those workers' compensation cases involving coverage for injured drivers." (Emphasis omitted.) Karwoski, 226 Ga.App. at 67, 486 S.E.2d 39. Furthermore, there was a pointed dissent to extension of the local ordinance rule to tort cases and to overruling Smith.
Thus, the decision itself makes manifest that the holding on the motion for reconsideration in Karwoski did not simply articulate well-established and unambiguous principles of law but rather extended the law. Moreover, one could argue that application of the local ordinance test to tort actions was unnecessary to the decision in Karwoski, a workers' compensation case.
Second, the original basis for application of the local ordinance rule to workers' compensation actions arose from the policy underlying the Workers' Compensation Act. This Court first applied a predecessor of the local ordinance rule to a taxicab case in 1939 in Prather, 59 Ga.App. 797(1), 2 S.E.2d 115. There, the Court held that a taxicab company *424 certified to act as such by the Georgia Public Service Commission was without authority to hire an independent contractor who had no such certificate and, therefore, any person hired would be considered an employee as a matter of law for the purposes of determining workers' compensation liability. Id. The Court explained that the public policy emanating from the Workers' Compensation Act dictated this result. It explained,
This is true because the law[, i.e., the Workers' Compensation Act,] requires the carrier to insure against injury to its passengers, and makes it responsible for the fitness of the drivers of its vehicles, which duties it is against public policy to the State for the carrier to delegate to another over whom the [licensing entity] could have no jurisdiction.
Id.
Prather was directly followed in Diamond Cab Co. v. Adams, 91 Ga.App. 220, 85 S.E.2d 451 (1954), which in turn led to a line of workers' compensation cases establishing what we now refer to as the local ordinance rule.[3]
Third, no court has determined that the same policy should apply to the doctrine of respondeat superior. The only case we find partially relevant is West End Cab Co. v. Stovall, 98 Ga.App. 724, 106 S.E.2d 810 (1958). But that case is nonprecedential, and, although the opinion states that the taxicab driver could not be an independent contractor because he operated the taxicab under the cab company's license and not his own, the court answered the question of whether the driver was an employee by considering whether the driver was under the company's supervision and control. Id. at 729, 106 S.E.2d 810.
Fourth, precedent from this Court existing at the time of the alleged legal malpractice shows that the test in tort cases for determining employee/independent contractor status was the traditional control test. See, e.g., Brunson v. Valley Coaches, 173 Ga.App. 667, 668(1), 327 S.E.2d 758 (1985) ("right to direct the time, the manner, the methods, and the means of the execution of the work"). See also Hand v. Checker Cab Co., 216 Ga. App. 116, 453 S.E.2d 138 (1995); Red Top Cab Co. v. Hyder, 130 Ga.App. 870, 204 S.E.2d 814 (1974) (company had no control over operation of cab); English v. Yellow Cab Co., 119 Ga.App. 828, 168 S.E.2d 920 (1969); Clark v. Atlanta Veterans Transp., 113 Ga.App. 531, 148 S.E.2d 921 (1966). Similarly, Supreme Court precedent applicable to both workers' compensation actions and tort actions holds that the primary test for answering the employee/independent contractor question is whether the agreement between the parties gives the employer "the right to control the time, manner[,] and method of executing the work, as distinguished from the right merely to require certain definite results in conformity to the contract." (Punctuation omitted.) Golosh v. Cherokee Cab Co., 226 Ga. 636, 637, 176 S.E.2d 925 (1970) (a workers' compensation case). See also Yearwood v. Peabody, 45 Ga.App. 451, 164 S.E. 901 (1932) (a tort action; cited as support by the Supreme Court in Golosh).
Finally, Smith v. Yellow Cab Co., a case decided after the alleged malpractice in this case but before Karwoski, specifically held that the local ordinance test did not override the traditional control test. Smith, 223 Ga. App. at 143, 476 S.E.2d 887. Although Karwoski overturned the decision in Smith, Smith reflects the opinion of this Court, and of the author of the decision in Karwoski, at a point in time closer to the alleged legal malpractice in this case.
For the above reasons and because Karwoski was decided long after the alleged legal malpractice in this case, the trial court did not err in refusing to charge the jury on Karwoski or to allow Rapid Group to use the decision at trial. Nor did the court err by refusing to grant a directed verdict or judgment notwithstanding the verdict because a *425 finding that Stephens was an employee of Yellow Cab was not demanded as a matter of fact and law, as it existed at the time. See St. Paul Mercury Ins. Co. v. Meeks, 270 Ga. 136, 137(1), 508 S.E.2d 646 (1998).[4]
2. Rapid Group also contends the trial court erred by failing to give a requested jury charge on the principle of intervening causation. Rapid Group asserts that it presented facts to support an argument that attorney Moore's negligence was not the proximate cause of the default judgment because his client Yellow Cab and its local attorney committed intervening acts of negligence. Rapid Group bases its argument on facts that show that Yellow Cab and its attorney Nicholas Cook were involved in the attempt to respond to the discovery and that they may have contributed to the delay or misunderstandings that led to entry of the default judgment. Rapid Group claims that Yellow Cab and Cook failed to timely return the discovery responses to Moore and that at one point in time Moore thought Cook had responded to the discovery on his own, so he did not follow up.
However, Moore was attorney of record for Rapid Group the entire ten months that the discovery questions went unanswered; there is no evidence of an agreement that Cook was responsible for responding to the discovery; Moore knew that the trial court had ordered that a response be filed by a certain day or else Rapid Group's pleadings would be struck; there is no evidence that Moore told his client that a motion to compel had been filed, although he told Cook; Moore never made any last minute attempts to obtain the discovery responses; and Moore allowed the deadline to pass without responding, requesting more time, or calling his client or Cook to obtain the responses immediately. Furthermore, Moore's attempt to place the blame on Cook is based in part on events that occurred after the ten-day deadline had passed, and Moore even admitted that he should have known that Cook had not actually responded to discovery at that late date. Moore stated in a letter to the judge, "I do not fault Attorney Cook on this, as a careful reading of his cover letter should have informed me that no copy was sent to Plaintiff's counsel."
As a matter of well-known law, there can be no intervening cause when "the character of the intervening act claimed to break the connection between the original wrongful act and the subsequent injury was such that its probable or natural consequences could reasonably have been anticipated, apprehended, or foreseen by the original wrongdoer." Southern R. Co. v. Webb, 116 Ga. 152, hn. 1, 42 S.E. 395 (1902). See also Cope v. Enterprise Rent-A-Car, 250 Ga.App. 648, 551 S.E.2d 841 (2001). Moore was attorney of record, and it was his responsibility to ensure that discovery responses were timely filed or to bring the matter to the attention of the court, if despite his best efforts, he could not obtain the necessary information from his client. Under the circumstances, Moore should have anticipated a default judgment given that he knew his client and Cook were not acting in a timely fashion. Therefore, although Cook may have been a joint cause of the failure to respond (a charge on joint responsibility was given), his actions could not eliminate Moore's duty as counsel of record.
Meiners v. Fortson & White, 210 Ga.App. 612, 436 S.E.2d 780 (1993), relied upon by Rapid Group, is distinguishable. There, after the first attorneys had been fired, the second attorney failed to serve the defendant even though he had six months to do so and had been specifically informed by one of the first attorneys that the defendant had never been served. Id. at 613, 436 S.E.2d 780. This Court held that substitution of new counsel who negligently fails to cure the results of the first counsel's negligence cuts off the first counsel's liability. Id. Here, however, Moore was always attorney of record.
3. Our findings above support the conclusion that the trial court also did not err in denying a motion for new trial. The evidence supports the allegation of negligence in *426 failing to respond to discovery thereby causing the loss of the independent contractor defense.
4. Rapid Group also contends that the trial court erred by submitting an attorney fee claim to the jury. Yellow Cab sought fees under OCGA § 13-6-11 for bad faith by Rapid Group in its contractual relations. Yellow Cab claimed that Rapid Group acted in bad faith defending the Howard lawsuit because attorney Moore's conduct fell far below the standard of care for attorneys and because Rapid Group condoned Moore's alleged minimalist approach to representing Yellow Cab. Yellow Cab does not claim in its appellate brief that it was entitled to fees for stubborn litigiousness or unnecessary trouble and expense in the malpractice litigation itself, and we agree that the existence of a bona fide controversy as shown above would preclude such a claim. See Lamb v. State Farm &c. Ins. Cos., 240 Ga.App. 363, 522 S.E.2d 573 (1999).
OCGA § 13-6-11 allows recovery of litigation expenses when a defendant has acted in bad faith. Where there is some evidence to support a finding of bad faith, an award of attorney fees on that basis must be affirmed. Crocker v. Stevens, 210 Ga.App. 231, 238(8), 435 S.E.2d 690 (1993).
It is true that this issue is generally one for the jury. See, e.g., Dept. of Transp. v. Dalton Paving &c., 227 Ga.App. 207, 219(6)(b), 489 S.E.2d 329 (1997). But bad faith cannot be prompted by an honest mistake as to one's rights or duties but must result from some interested or sinister motive. Plemons v. Weaver, 243 Ga.App. 464, 533 S.E.2d 747 (2000). See also Glen Restaurant v. West, 173 Ga.App. 204, 205, 325 S.E.2d 781 (1984). "`Bad faith' is not simply bad judgment or negligence, but it imports a dishonest purpose or some moral obliquity, and implies conscious doing of wrong, and means breach of known duty through some motive of interest or ill will. [Cit.]" Vickers v. Motte, 109 Ga.App. 615, 619-620, 137 S.E.2d 77 (1964).
Yellow Cab presented evidence at trial that Moore was negligent in the following ways: (1) failing to advise his client, Yellow Cab, to demand that Rapid Group offer policy limits; (2) failing to serve discovery responses in a timely fashion; (3) failing to depose the plaintiffs or their physician; (4) consenting to striking his client's answer after he was faced with the fact that the discovery had not been answered, even in response to an order of the court to do so, and (5) failing to inform his client of the trial date on damages and the importance of having a party representative at trial. In addition, Yellow Cab asserted that Moore violated several provisions of the Code of Professional Responsibility and Rules of Conduct of the State Bar of Georgia.
But Yellow Cab points to no testimony or other evidence in the record to show that Moore or Rapid Group acted dishonestly or that they were motivated by sinister motive or ill will. The cited testimony and evidence supports only claims of negligence by Moore, which do not support an award of bad faith. Michaels v. Gordon, 211 Ga.App. 470, 439 S.E.2d 722 (1993). "[P]roof of mere negligence or bad judgment is not proof that [Moore] refused to fulfill [his] professional duties, out of some interested or sinister motive, or that [he] consciously acted for some dishonest or improper purpose." Id. at 473(2)(b), 439 S.E.2d 722.
Yellow Cab argues that because Rapid Group retained Moore on a flat fee of $6,000 per month no matter how much work he did, the jury was authorized to find that Rapid Group acted in bad faith by "condoning Moore's `minimalist' representation, that ... fell far below the standard of care and amounted to a violation of [Rapid Group's] duty of good faith to its insured." First, we find this inference to be invalid on its face. Otherwise, we could also conclude that all salaried workers have an incentive to do as little as possible. In addition, regardless of Rapid Group's business arrangement with Moore, Yellow Cab points to no evidence showing that this business relationship affected any of Moore's litigation decisions. Although Moore breached a known duty, there is simply no evidence of ill will, personal gain, or other improper purpose.
*427 Therefore, the trial court erred by failing to grant Rapid Group's motion for directed verdict on the issue of attorney fees.
Judgment affirmed in part and reversed in part.
MIKELL, J., concurs.
BLACKBURN, C.J., concurs fully in Divisions 2, 3 and 4 and concurs specially as to the judgment only in Division 1.
BLACKBURN, Chief Judge, concurring specially.
I fully concur in Divisions 2, 3, and 4 and the judgment. I do not concur in Division 1 and write specially. I cannot concur in the analysis contained in Division 1 or the holding and analysis of Yellow Cab of Chatham County v. Karwoski, 226 Ga.App. 63, 486 S.E.2d 39 (1997). The majority opinion's characterization of Karwoski is a distortion of the opinion and represents an attempt to refight battles previously lost. As Karwoski clearly indicates, the case law in existence at the time the malpractice in this case occurred would have provided no recourse to a defense lawyer who failed to raise the defense of independent contractor. A simple reading of Karwoski will show that its holding was that the relationship between a cab company and its drivers is controlled by the applicable local ordinance, where such addresses this relationship, directly or indirectly. Where the local ordinance does not address this matter, one then looks to the general law. The cab company cases generally arose out of automobile accident cases, where a private citizen sought damages from the cab company, and the cabdriver might seek workers' compensation benefits. In either case, cab companies took the position that the drivers were independent contractors. Judge Johnson addressed the unfairness to the general public created by this problem in his special concurrence in Loudermilk Enterprises v. Hurtig, 214 Ga.App. 746, 449 S.E.2d 141 (1994).
Municipalities were given the authority to regulate taxicab companies which operated within their corporate limits by the legislature. Many municipalities adopted rules which precluded drivers of taxicabs from being independent contractors, while others did not.
Karwoski pointed out that numerous cases were decided by this court without regard to applicable local ordinances. The majority here chooses an array of such cases to make its point. The dissent in Karwoski relied on two cases having no precedential value whatsoever. In Smith v. Yellow Cab Co. of Chatham County, 223 Ga.App. 143, 476 S.E.2d 887 (1996), the case which we overruled in Karwoski, the majority relied upon the single judge opinion in Loudermilk Enterprises, supra. We note that Loudermilk Enterprises, which involved a City of Atlanta taxicab company, did not address the application of the city ordinance. It may well have been that the ordinance was not raised, but we note that Worrell v. Yellow Cab Co., 146 Ga.App. 748, 247 S.E.2d 569 (1978), a case involving the Atlanta City Code, held that taxicabs shall not be operated by any person other than the owner or his employee. Under the Karwoski dissent the cabdriver could be an independent contractor for workers' compensation purposes, but an employee for tort purposes. I would suggest that anyone wishing to understand Karwoski read the opinion and Judge Johnson's special concurrence. In any event, Karwoski, as written, would provide no defense for the attorney in this case.
NOTES
[1] An attorney is only negligent if he or she "wilfully or negligently fails to apply commonly known and accepted legal principles and procedures through ignorance of basic, well-established and unambiguous principles of law or through a failure to act reasonably to protect his client's interests." (Citation and punctuation omitted.) Jones, Day, Reavis & Pogue v. American Envirecycle, 217 Ga.App. 80, 83(2), 456 S.E.2d 264 (1995).
[2] Although the exact manner of how the local ordinance functions in this way differs, see Karwoski, the differences are not relevant here.
[3] See Malone v. Gary, 98 Ga.App. 699, 106 S.E.2d 320 (1958); Atlanta Million Co-op. Cab Co. v. Wilson-Acomb, 108 Ga.App. 465, 133 S.E.2d 437 (1963); Worrell v. Yellow Cab Co., 146 Ga.App. 748, 247 S.E.2d 569 (1978); Univ. Cab v. Fagan, 150 Ga.App. 404, 258 S.E.2d 21 (1979), aff'd, 245 Ga. 469, 266 S.E.2d 798 (1980); Atlanta Checker Cab Co. v. Padgett, 154 Ga.App. 43, 267 S.E.2d 464 (1980).
[4] Evidence was presented during the trial to support Yellow Cab's contention that Stephens was an independent contractor. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/99396/ | 250 U.S. 85 (1919)
NEW YORK CENTRAL RAILROAD COMPANY
v.
GOLDBERG.
No. 256.
Supreme Court of United States.
Argued March 20, 1919.
Decided May 19, 1919.
CERTIORARI TO THE SUPREME COURT OF THE STATE OF NEW YORK.
Mr. William Mann, with whom Mr. Charles C. Paulding was on the brief, for petitioner.
No appearance for respondent.
MR. JUSTICE PITNEY delivered the opinion of the court.
This was an action brought by respondent against petitioner in the Supreme Court of New York to recover damages equivalent to the value of certain goods shipped in interstate commerce and lost in transit. Plaintiff had judgment in the trial court, which was affirmed by the Appellate Division for the First Department (164 App. *86 Div. 389), and affirmed by the Court of Appeals without opinion. [221 N.Y. 539.]
The facts are as follows: On September 17, 1912, a firm of fur manufacturers in New York City caused to be delivered to defendant there for transportation to plaintiff at Cincinnati, Ohio, a case containing furs belonging to plaintiff of the value of $693.75. When the case left the consignors' possession it was marked with the name and address of the consignee, and with the word "furs" conspicuously displayed. It was delivered to a local expressman, whose driver delivered it to defendant and made out a bill of lading which defendant signed and upon which the action depends. This bill of lading described the goods as "One case D.G.," which admittedly means "dry goods." The misdescription was the driver's mistake, not made with any intent to fraudulently misrepresent the nature of the merchandise shipped. Defendant's clerk who signed the bill of lading relied wholly upon the representations of the driver as to the contents of the case, not seeing the case itself; and, so far as appears, no representative of defendant compared or had a convenient opportunity to compare the bill of lading with the marks on the case. At the time of the shipment the official freight classification filed with the Interstate Commerce Commission provided for a first-class rate for dry goods (65 cents per hundred pounds), and a double-first-class rate ($1.30 per hundred) for furs. As a result of the misdescription in the bill of lading, freight was charged at the smaller rate applicable to dry goods, instead of the higher one applicable to furs. No valuation was placed upon the goods, and no question of limitation of liability to a stipulated value is presented.
Defendant admitted that it received the goods for transportation, and that they were stolen in transit and never delivered to the consignee.
Defendant insists that it is not liable in any amount *87 for loss of the goods, because they were misdescribed in the bill of lading. Reliance is placed upon a line of decisions in this court relating to the limitation of liability of an interstate rail carrier where goods are shipped at a declared value at a rate based upon value and under a contract conforming to the filed tariff. Adams Express Co. v. Croninger, 226 U.S. 491, 509; Kansas City Southern Ry. Co. v. Carl, 227 U.S. 639, 650, et seq.; Missouri, Kansas & Texas Ry. Co. v. Harriman, 227 U.S. 657, 670; Great Northern Ry. Co. v. O'Connor, 232 U.S. 508, 515; Atchison, Topeka & Santa Fe Ry. Co. v. Robinson, 233 U.S. 173, 180; Southern Ry. Co. v. Prescott, 240 U.S. 632, 638.
The Appellate Division held that these cases did not go to the extent of relieving the carrier from all liability in case of a non-fraudulent misrepresentation as to the nature of the merchandise shipped, and that since there was no clause in the bill of lading exempting the carrier or limiting its liability in case of such a misdescription the carrier was defenseless.
Defendant's contention is that there is no responsibility for loss of the furs that were shipped because they were goods not of the same but of a different character than those described in the bill of lading, and were goods for the transportation of which a higher rate was established by its filed schedules. Were there otherwise any difficulty in answering this contention, it would be wholly relieved by the fact that the precise contingency was anticipated in the preparation of the form of the bill of lading and provided for by one of its conditions, which reads as follows: "The owner or consignee shall pay the freight and all other lawful charges accruing on said property, and, if required, shall pay the same before delivery. If upon inspection it is ascertained that the articles shipped are not those described in this bill of lading, the freight charges must be paid upon the articles actually shipped."
Clearly, the effect of this is that a misdescription of the *88 character of the goods, not attributable to fraud, merely imposed upon the shipper or consignee an obligation to pay freight charges according to the character of the goods actually shipped, and did not affect the liability of the carrier for a failure to deliver the goods.
Judgment affirmed. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1138600/ | 785 P.2d 380 (1990)
In the matter of the Compensation of James A. Cooper, Claimant.
EBI COMPANIES, Petitioner,
Coos Curry Roofing, Employer,
v.
James A. COOPER, Respondent.
WCB TP-87022; CA A50167.
Court of Appeals of Oregon.
Argued and Submitted September 8, 1989.
Decided January 17, 1990.
*381 Patric J. Doherty, Portland, argued the cause for petitioner. With him on the brief was Rankin, VavRosky, Doherty, MacColl & Mersereau, Portland.
James C. Coffey, North Bend, argued the cause for respondent. With him on the brief was Stebbins & Coffey, North Bend.
Before GRABER, P.J., and RIGGS and EDMONDS, JJ.
EDMONDS, Judge.
EBI seeks review of a Workers' Compensation Board order that held that claimant was entitled to rescind his election, made pursuant to ORS 656.591, to assign his third party action to EBI and that the proceeds of the third party settlement should be redistributed pursuant to ORS 656.593(1).[1] We affirm.
Claimant suffered a compensable injury in November, 1981. In June, 1982, he was involved in an off-the-job accident that caused increased pain and new symptoms. He pursued an aggravation claim and elected to assign his third party rights arising from the accident to EBI, pursuant to ORS 656.591.[2] EBI settled that action in April, *382 1986, and the proceeds were distributed pursuant to ORS 656.591(2). In the distribution, claimant received nothing.
In October, 1987, claimant petitioned the Board for a third party order pursuant to ORS 656.593 to redistribute the recovery in the third party action. Claimant contended that EBI had induced him to assign his claim by fraud or misrepresentation. The Board concluded that the assignment was invalid and ordered redistribution of the proceeds as if claimant had maintained his own third party action pursuant to ORS 656.593.
Although it is not raised by the parties, we decide as a threshold issue whether the Board had jurisdiction and the authority to order that claimant's election be rescinded and the proceeds be redistributed. This dispute involves "matters concerning a claim under ORS 656.001 to 656.794," because the worker's right to receive compensation is directly in issue. ORS 656.704(1), (3). The paying agency's right to distribution of third party recoveries is derived from its responsibility for compensation, and the amount distributed is determined in part by the amount of compensation paid. See Schlect v. SAIF, 60 Or. App. 449, 455, 653 P.2d 1284 (1982). ORS 656.591 gives the Board jurisdiction over the parties and the subject matter of an election by a worker to assign his third party claim to a paying agency. The Board's authority to order rescission of an election fraudulently obtained flows from the exercise of that jurisdiction, because an election that was induced by fraud is, in fact, no election.
The Board stated:
"In Ebbtide Enterprises v. Tucker, 303 Or 459, 464[, 738 P.2d 194] (1987), the Court held that, in order to support a recision of an earlier acceptance, the insurer must show that the decision to accept the claim `could reasonably have been affected' if the true facts had been known. The insurer is not required to show that it in fact would have denied the claim with the correct information. Newport Elks Club v. Hays [, 92 Or. App. 604, 607, 759 P.2d 327, rev. den. 307 Or. 245, 767 P.2d 75 (1988)].'
"Applying this standard to the third party matter before us, we conclude that claimant need only show that the election form was misleading and that his decision to assign his rights to the paying agency `could reasonably have been affected' if the true facts had been known. Claimant need not prove that he was, in fact, misled into assigning his third party action to the paying agency. See Newport Elks Club v. Hays, supra, 92 Or App at 607 [759 P.2d 327].
"We find that the election form is misleading. Option `A' and Option `B', read together, strongly imply that in order to continue receiving benefits under his compensable claim, claimant had to elect Option `B'. Both parties agree that this is not a correct statement of the law. Moreover, it is readily apparent that claimant's election could have been influenced by the knowledge that he did not need to assign his third party action to the paying agency in order to continue to receive his workers' compensation benefits.[[3]] We conclude that, absent a defense on the part of the paying agency, claimant is entitled to rescind his prior election." (Emphasis supplied.)
EBI does not argue that the Board applied the wrong legal standard when it held that the claimant must show that his election could reasonably have been affected by the misleading language in the notice. Rather, it argues that the Board erred in refusing to resolve an underlying credibility *383 dispute between claimant and the claims representative and in basing its decision on the language of the election form, because claimant did not rely on it. It points to the fact that claimant called petitioner after receiving the election form notice. Petitioner's claims representative and claimant disagree about what the representative said in that conversation. Petitioner suggests that OAR 438-11-045(2), which provides that testimonial evidence in third party disputes shall be by "deposition, affidavit or written interrogatories," and ORS 656.593(3)[4] require the Board to resolve the credibility dispute as a matter of law.
Nothing in ORS 656.593(3) or OAR 438-11-045(2) prohibits the Board from considering the conflicting testimony of the claimant and the claims representative to be in equipoise or from relying on the election notice language as the determinative factor. There is substantial evidence to support the Board's finding that the election notice could have affected claimant's election. Although claimant testified that, after receiving the election form, he called the claims representative and "asked what the letter meant," thereafter he signed the election form and returned it to petitioner. It is just as reasonable to infer that the conversation with the claims representative did not obviate the misleading language of the election form as it is to infer that it did. Therefore, the Board did not err.[5]
Affirmed.
NOTES
[1] ORS 656.593(1) provides:
"(1) If the worker or the beneficiaries of the worker elect to recover damages from the employer or third person, notice of such election shall be given the paying agency by personal service or by registered or certified mail. The paying agency likewise shall be given notice of the name of the court in which such action is brought, and a return showing service of such notice on the paying agency shall be filed with the clerk of the court but shall not be a part of the record except to give notice to the defendant of the lien of the paying agency, as provided in this section. The proceeds of any damages recovered from an employer or third person by the worker or beneficiaries shall be subject to a lien of the paying agency for its share of the proceeds as set forth in this section and the total proceeds shall be distributed as follows:
"(a) Costs and attorney fees incurred shall be paid, such attorney fees in no event to exceed the advisory schedule of fees established by the board for such actions.
"(b) The worker or the beneficiaries of the worker shall receive at least 33 1/3 percent of the balance of such recovery.
"(c) The paying agency shall be paid and retain the balance of the recovery, but only to the extent that it is compensated for its expenditures for compensation, first aid or other medical, surgical or hospital service, and for the present value of its reasonably to be expected future expenditures for compensation and other costs of the worker's claim under ORS 656.001 to 656.794. Such other costs include assessments for reserves in the Insurance and Finance Fund, but do not include any compensation which may become payable under ORS 656.273 or 656.278.
"(d) The balance of the recovery shall be paid to the worker or the beneficiaries of the worker forthwith. Any conflict as to the amount of the balance which may be retained by the paying agency shall be resolved by the board."
[2] ORS 656.591 provides:
"(1) An election made pursuant to ORS 656.578 not to proceed against the employer or third person operates as an assignment to the paying agency of the cause of action, if any, of the worker, the beneficiaries or legal representative of the deceased worker, against the employer or third person, and the paying agency may bring action against such employer or third person in the name of the injured worker or other beneficiaries.
"(2) Any sum recovered by the paying agency in excess of the expenses incurred in making such recovery and the amount expended by the paying agency for compensation, first aid or other medical, surgical or hospital service, together with the present worth of the monthly payments of compensation to which such worker or other beneficiaries may be entitled under ORS 656.001 to 656.794, shall be paid such worker or other beneficiaries."
[3] Although the emphasized wording is confusing, in the context of all of the Board's findings, we understand the sentence to say that, if claimant had known that he did not need to assign his claim in order to continue to receive benefits, his election might have been different.
[4] ORS 656.593(3) provides:
"A claimant may settle any third party case with the approval of the paying agency, in which event the paying agency is authorized to accept such a share of the proceeds as may be just and proper and the worker or the beneficiaries of the worker shall receive the amount to which the worker would be entitled for a recovery under subsections (1) and (2) of this section. Any conflict as to what may be a just and proper distribution shall be resolved by the board."
[5] Petitioner's other arguments do not merit discussion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/250424/ | 276 F.2d 165
John DOW, Plaintiff-Appellant,v.SHOE CORPORATION OF AMERICA et al., Defendants,Mid-States Shoe Company, a Wisconsin corporation, Defendant-Appellee.
No. 12840.
United States Court of Appeals Seventh Circuit.
March 23, 1960.
Rehearing Denied April 21, 1960.
Bernard E. Wall, Bloomington, Ill., Roger H. Little, Urbana, Ill., Wall & Ulbrich, Bloomington, Ill., for appellant.
Lyle W. Allen, Peoria, Ill., Clarence W. Heyl, William J. Voelker, Jr., Peoria, Ill., Heyl, Royster & Voelker, Peoria, Ill., of counsel, for appellees.
Before HASTINGS, Chief Judge, SCHNACKENBERG, Circuit Judge, and JUERGENS, District Judge.
SCHNACKENBERG, Circuit Judge.
1
John Dow, plaintiff, a shoe manufacturer's salesman, in count III of his amended complaint, sued Mid-States Shoe Company, a Wisconsin corporation, and others not now before the court, for breach of an alleged oral contract for plaintiff's lifetime employment. On motion of Mid-States, herein also called defendant, the district court ordered a dismissal of the amended complaint1 at plaintiff's costs, for failure to state a cause of action, and this appeal followed.
2
Substantively the law of Wisconsin governs this case.
3
Count III alleges that on January 10, 1935, at Milwaukee, Wisconsin, during plaintiff's prior employment as a salesman for defendant's predecessor, Walter Booth Shoe Company, the latter agreed to employ plaintiff as salesman for life at a six percent commission. Three alternative allegations of the terms of this alleged agreement are also stated in count III.
4
This count also avers that this contract was entered into on behalf of defendant's predecessor, by and through its duly authorized agent and employee Harold Leiser, its then sales manager, acting within the scope of his employment, or, in the alternative, purporting to act within said scope, which contract was ratified and affirmed by the predecessor and was thereafter assumed or ratified and affirmed by defendant.
5
It is alleged that plaintiff from January 10, 1935 to September 30, 1957, duly performed his duties under said employment contract and remains ready, willing and able to perform such agreement, but that on or about the latter date defendant wrongfully refused to employ him for the remainder of the period thereunder.
6
1. Contending that the agreement sued on is void under the statute of frauds, defendant quotes from the Wisconsin statute, sec. 241.02, ch. 241, Wis.Stat.1955:
7
"Agreements, what must be written. In the following case every agreement shall be void unless such agreement or some note or memorandum thereof, expressing the consideration, be in writing and subscribed by the party charged therewith:
8
"(1) Every agreement that by its terms is not to be performed within one year from the making thereof. * * *"
9
However, we are mindful of the fact that, when the contract involved in this case was made, the date of death of plaintiff was of course unknown and the possibility that he might die within one year after the contract was made prevented the contract from falling within the scope of the statute of frauds. Nelsen v. Farmers Mutual Auto. Ins. Co., 1958, 4 Wis.2d 36, 90 N.W.2d 123. Moreover, it is alleged in count III that, as a result of plaintiff's performance under the contract and the expenditure of his own funds for expenses, advertising and promotion of defendant's shoes, he built up defendant's good will and increased its accounts in his territory from 18 to more than 100. The significance of these alleged facts is made apparent by the language of the court in Nelsen, supra, 4 Wis.2d at pages 42-52, 90 N.W.2d at pages 126-132.
10
We hold that, on the facts alleged, the plaintiff's cause of action is not barred by the statute of frauds of Wisconsin.2
11
2. Whether plaintiff on a trial of issues of fact raised by a responsive answer will be able to prevail, we do not know. Among the ultimate facts which he may have to prove by evidence is that the making of the alleged contract by Leiser was ratified. However, it is not a proper function of the court to decide that ultimate fact, or any other, on a motion to dismiss.
12
For the reasons which we have stated, the order of the district court is reversed and this case is remanded with directions to proceed further in a manner not inconsistent with our views.
13
Reversed and remanded with directions.
Notes:
1
176 F.Supp. 916
2
Whether we are required to consider the defense of the statute of frauds at this stage of the case, rather than under Fed.Rules Civ.Proc. 28 U.S.C.A. rule 8 (c), we do not decide, as plaintiff has waived the point by arguing the point on its merits | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1121180/ | 495 P.2d 36 (1972)
In the matter of the Compensation of Josephine PATITUCCI, Claimant.
Josephine Patitucci, Respondent,
v.
BOISE CASCADE CORPORATION, Appellant.
Court of Appeals of Oregon, Department 1.
Argued and Submitted January 24, 1972.
Decided March 23, 1972.
Roger R. Warren, Portland, argued the cause and filed the brief for appellant.
Raymond J. Conboy, Portland, argued the cause for respondent. With him on the brief were Pozzi, Wilson & Atchison and Brian L. Welch, Portland.
Before SCHWAB, C.J., and FOLEY and THORNTON, JJ.
*37 FOLEY, Judge.
The question presented in this workmen's compensation case is whether the circuit court erred in finding claimant permanently and totally disabled as a result of her industrial accident of May 16, 1967.
The claimant, 56 years old at the time of her compensation hearing, had been employed for more than 25 years in general office work and secretarial work. She was unmarried, lived with an older sister and had a high school education plus some additional training in shorthand and typing. At the time of the injury involved here, she was employed by Boise Cascade Corporation as a secretary. On May 16, 1967, she tripped over an electric cord near her desk and fell back against a wall, twisting and injuring her back and shoulders. She continued to work for several days but began suffering pain in her arms and in the neck area. On June 10, 1967, she went to see Dr. Lawrence Noall, an orthopedic surgeon, who had known and treated her during the past 20 years. He treated her for the injuries she sustained on May 16, 1967, diagnosing them as
"* * * a sprain of the muscles and ligaments of the cervical spine and upper dorsal spine superimposed on some preexisting arthritic and intervertebral disc changes which have resulted in a radicular neuritis involving both arms, but now [April 21, 1970] primarily the right upper extremity and hand."
Dr. Noall stated that he did not think claimant was able to gainfully perform the work of a secretary "which is the only work * * * she's qualified to do. * * *" He testified that the only kind of work that the claimant could do would be
"* * * something that is largely sedentary; something in which the arms do not have to be suspended such as you would have to with continuous typing. And also it would need to be something that does not involve lifting."
Dr. Noall testified further that the claimant could not work at any job unless she could lie down and rest for periods during the regular work day. He stated:
"* * * [T]he injuries that she sustained * * * is the thing that triggered the present * * * symptoms involving the neck and the arm."
He estimated her physical disability "approximately 20 percent whole body permanent physical impairment and loss of physical function." She was also treated by Dr. Canfield Beattie, an ophthalmologist, for visual problems distortion of vision and inability to produce tears, which he related to the industrial accident.
There was a great deal of other medical evidence. A review of this evidence leads to the conclusion that claimant's physical impairment was less than would normally result in permanent total disability, but that it was superimposed on her underlying psychological or neurotic problems. Some doctors thought she was not permanently totally disabled. We agree with the treating doctor and the hearing officer that she was, in fact, properly rated a permanent total. The question remains whether the disability is causally connected to the industrial accident.
A psychological evaluation of claimant was performed by a clinical psychologist, Dr. Julia Perkins, and without seeing the patient, by psychologist Dr. Norman Hickman, both of whom found claimant had a moderately severe, chronic psychopathology which was unrelated to the industrial accident. Based upon this evaluation the defendant-employer claims there are two separate disabilities, one physiological and the other psychological, moderately severe. He states, therefore, that the employer, not being responsible for the psychological overlay, would not be chargeable for any more than her physiological disability.
The hearing officer found claimant was permanently and totally disabled but that her permanent total disability was not caused by her industrial injury "* * * because the clinical psychologists do not causally relate her psychological problems to her injury. * * *" The Workmen's *38 Compensation Board agreed with the latter finding of the hearing officer but did not agree that she was permanently totally disabled.
"The employer takes the employe as he is. An aggravation by industrial accident of a preexisting condition is compensable. Kehoe v. State Ind. Accident Comm., 214 Or. 629, 332 P.2d 91 (1958); Keefer v. State Ind. Acc. Commission, 171 Or. 405, 135 P.2d 806 (1943)." Watson v. Georgia-Pacific Corp., Or. App., 91 Adv.Sh. 1263, 1266, 478 P.2d 431, 92 Adv.Sh. 995, 484 P.2d 1115 (1970).
It is not necessary that the accidental injury be the principal cause of the disability. It is sufficient if it contributed to claimant's disability.
"Under the purposes to be accomplished in social welfare by the enactment of the Workmen's Compensation Acts, we are of the opinion that the law does not weigh the relative importance of the several causes that bring about the injury it is sufficient if the accident occurring through employment is a contributing cause of the result. 1 Larson's Workmen's Compensation Law 50, Categories of Risk § 7.40." Kehoe v. State Ind. Accident Comm., 214 Or. 629, 637, 332 P.2d 91, 95 (1958).
If the contribution is minimal or de minimis, for example, if claimant would have become disabled by psychological developments at the same time, whether she was involved in an industrial accident or not, then the accident would not be deemed to have contributed to the disability. Here, Dr. Perkins, the psychologist whose examination was the basis for the hearing officer's denial of causal connection testified as follows:
"Q If she had not been injured as a result of the accident on the 23rd of May, 1967, for how long would she have continued to function?
"A On the job?
"* * * * * *
"A This is hard to say, but it would be my judgment maybe five or six years."
This testimony indicates that but for the accident she would, in the judgment of the psychologist, have been able to continue in secretarial work for some period of time. This supports the trial court's finding that the industrial accident was a contributing factor to the disability.
The general rules set forth above apply to physical disability which is, in whole or in part, of hysterical or neurotic origin. See, for example, the hearing officer's statement of the rule in Rios v. Timber Structures, Inc., Or. App., 94 Adv.Sh. 278, 493 P.2d 174 (1972). The rule is stated as follows in 1A Larson's Workmen's Compensation Law 622.162, Personal Injury by Accident § 42.22:
"* * * [W]hen there has been a physical accident or trauma, and claimant's disability is increased or prolonged by traumatic neurosis, conversion hysteria, or hysterical paralysis, it is now uniformly held that the full disability including the effects of the neurosis is compensable. Dozens of cases, involving almost every conceivable kind of neurotic, psychotic, depressive, or hysterical symptom or personality disorder, have accepted this rule. * * *"
We conclude with the circuit court that claimant became permanently and totally disabled as a result of her industrial accident of May 16, 1967.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1424240/ | 731 P.2d 797 (1987)
112 Idaho 254
STATE of Idaho, Plaintiff-Respondent,
v.
Verna L. SIMONS, Defendant-Appellant.
No. 15806.
Court of Appeals of Idaho.
January 14, 1987.
Petition for Review Denied March 30, 1987.
*798 Kenneth F. White, Nampa, for defendant-appellant.
Jim Jones, Atty. Gen., Lynn E. Thomas, Sol. Gen., and Myrna A.I. Stahman, Deputy Atty. Gen., Boise, for plaintiff-respondent.
WALTERS, Chief Judge.
Verna Simons pled guilty to involuntary manslaughter. She was sentenced to the custody of the board of correction for an indeterminate ten-year period. On appeal, she raises two issues: (1) whether the district court abused its discretion in denying Simons' postsentence motion to withdraw her plea; and (2) whether the ten-year indeterminate sentence was an abuse of the court's sentencing discretion. We hold that the district court did not abuse its discretion in either respect. We affirm.
On an evening in January, 1984, Verna Simons left the house she shared with J.D. Jameson to drive to Caldwell, Idaho, about eight miles away. She sought the shelter of her parents' home in Caldwell because of mistreatment of her by Jameson. Apparently, Jameson approached Simons' automobile as she was preparing to leave and attempted to dissuade her. Simons locked the doors and drove away. Unfortunately, Jameson's hand became caught in the passenger door between the window and frame. He was dragged to his death. Simons contends she was not aware that the victim was attached to her vehicle until she was stopped by police in Caldwell.
Simons was charged initially with second degree murder. See I.C. § 18-4001. Pursuant to a plea agreement, Simons pled guilty to involuntary manslaughter the unlawful killing of a human being, without malice, in perpetration of an unlawful act, or in the commission of a lawful act without due caution and circumspection. See I.C. § 18-4006(2). In Idaho, involuntary manslaughter carries a maximum penalty of a $10,000 fine and imprisonment for ten years. I.C. § 18-4007(2).[1] Following an extended sentencing hearing before District Judge Williams, Simons received an indeterminate ten-year sentence.
During the sentencing hearing, defense counsel became aware of additional evidence relating to Simons' mental and physical condition immediately following the accident. After the sentence was pronounced, Simons filed a notice of appeal. While her appeal was pending, Simons moved to withdraw her plea pursuant to I.C.R. 33(c). The motion was heard by District Judge Doolittle. Judge Doolittle found that the necessary manifest injustice required by I.C.R. 33(c) had not been *799 shown and denied the motion. Thus, we are asked to review both the sentence and the denial of the postsentence motion to withdraw Simons' plea.
I
We first review Judge Doolittle's decision denying Simons' motion to withdraw her plea. We begin by acknowledging the following principles relative to pleas of guilty and motions to withdraw such pleas.
A
A plea of guilty has the same force and effect as a judgment rendered after a full trial on the merits. Lockard v. State, 92 Idaho 813, 451 P.2d 1014 (1969). Like the verdict of a jury it is conclusive as to the facts. The court is left with "nothing to do but give judgment and sentence." Id. at 818, 451 P.2d at 1019, quoting Kercheval v. United States, 274 U.S. 220, 47 S.Ct. 582, 71 L.Ed. 1009 (1927). Idaho Criminal Rule 33(c) reads: "A motion to withdraw a plea of guilty may be made only before sentence is imposed or imposition of sentence is suspended; but to correct manifest injustice the court after sentence may set aside the judgment of conviction and permit the defendant to withdraw his plea." Our neighboring state of Washington describes "manifest injustice," for purposes of its comparable rule, as an injustice that is obvious, directly observable, overt, and not obscure. State v. Norval, 35 Wash. App. 775, 669 P.2d 1264 (1983). Denial of due process was deemed manifest injustice as a matter of law under the former comparable Federal Rule of Criminal Procedure 32(d). United States v. Crusco, 536 F.2d 21 (3d Cir.1976).
Under Rule 33(c) a stricter standard is applied following sentencing to insure that the accused does not plead guilty merely to test the weight of potential punishment and then to withdraw the plea if the sentence is unexpectedly severe. State v. Freeman, 110 Idaho 117, 714 P.2d 86 (Ct.App. 1986); State v. Jackson, 96 Idaho 584, 532 P.2d 926 (1975). A lesser standard would undermine respect for the courts and waste the time and effort devoted to the sentencing process. Kadwell v. United States, 315 F.2d 667 (9th Cir.1963).
A motion to withdraw a guilty plea is addressed to the sound discretion of the trial court. State v. Creech, 109 Idaho 592, 710 P.2d 502 (1985); State v. Freeman, supra. Appellate review of the denial of a motion to withdraw a plea is limited to whether the district court exercised sound judicial discretion as distinguished from arbitrary action. State v. Freeman, supra. Ordinarily a plea knowingly, intelligently and voluntarily entered may not be withdrawn after sentencing. We look to the whole record to determine whether it is manifestly unjust to preclude the defendant from withdrawing a guilty plea. State v. Creech, supra.
According to § 2.1(a)(ii) of the ABA STANDARDS RELATING TO PLEAS OF GUILTY (1968):
Withdrawal is necessary to correct a manifest injustice whenever the defendant proves that:
(1) he was denied the effective assistance of counsel guaranteed to him by constitution, statute, or rule;
(2) the plea was not entered or ratified by the defendant or a person authorized to so act in his behalf;
(3) the plea was involuntary, or was entered without knowledge of the charge or that the sentence actually imposed could be imposed;
(4) he did not receive the charge or sentence concessions contemplated by the plea agreement and the prosecuting attorney failed to seek or not to oppose these concessions as promised in the plea agreement; or
(5) he did not receive the charge or sentence concessions contemplated by the plea agreement concurred in by the court, and he did not affirm his plea after being advised that the court no longer concurred and being called upon to either affirm or withdraw his plea.
A plea may be withdrawn without an allegation that the defendant is innocent of the charge to which the plea was entered. Id. *800 See also C. WHITEHEAD, CRIMINAL PROCEDURE: AN ANALYSIS OF CONSTITUTIONAL CASES AND CONCEPTS § 21.04 (1980) (discussing the ABA STANDARDS).
B
We now turn to the application of the foregoing principles to Simons' case. The jail matron who attended to Simons immediately following her arrest had knowledge that Simons was severely disoriented upon initial incarceration. In addition, she was prepared to testify that Simons exhibited physical symptoms of injuries that might have been recently inflicted. The state did not provide this information to Simons or to her counsel. In response to defense inquiries, the jailer indicated that all relevant information was contained in her written report. The report did not contain this information. Her knowledge was not otherwise made available to the defense. During the sentencing hearing, the jailer independently contacted Simons' counsel and revealed this information. However, Simons did not then seek to withdraw her plea. She waited until the sentence had been determined.
Simons argues that this evidence of her mental and physical condition "discovered" following her plea of guilty was material to her second-degree murder defense. Had she been aware of this information, she contends she would have had a stronger case and, therefore, would not have pled guilty to the lesser offense of involuntary manslaughter. Specifically Simons argues that this information was material to her claim that she was fleeing from Jameson in fear of bodily harm or death; that it supports her claim that she was not aware Jameson was attached to the vehicle; that it would have been of assistance to her counsel in their investigation; and, that it could have been used to explain her original, disjointed account of the events surrounding Jameson's death.
Simons contends that constitutional due process imposes a duty upon the state to provide such exculpatory evidence to the defense. Therefore, she seeks to withdraw her plea as one not knowingly or intelligently entered, but entered due to the coercion and deception of the prosecution. Alternatively, she contends that the unavailability of this evidence rendered her counsel ineffective and inadequate because counsel could not competently evaluate her case.
Simons points to her discovery request under Idaho Criminal Rule 16(b), filed with the court before she pled guilty, seeking:
All statements, documents, and tangible items relating to the booking in and/or incarceration of the Defendant at the Canyon County Jail, including but not limited to booking sheets, photographs, mug shots, attorney logs, visitors logs, security checks, medications, dispatch logs, tape recordings, any and all progress notes, reports and/or documents relating to or referring in any way to the Defendant.
1. The Prosecutor's duty to disclose.
The state argues that Simons' discovery request did not cover the particular information at issue here. The state contends that the jailer's personal knowledge does not fall within "statements, documents, and tangible items." We agree. This request related to tangible items in the prosecutor's possession. The knowledge of possible defense witnesses or similar intangible exculpatory information was apparently not specifically requested. Thus I.C.R. 16(b) is not applicable. Nor was the jailer a potential prosecution witness. Thus the state was not required to include her name on its witness list. See I.C.R. 16(b)(6). However, this conclusion does not end our inquiry.
The state has a duty to provide all exculpatory or possibly exculpatory material, whether requested or not. United States v. Agurs, 427 U.S. 97, 96 S.Ct. 2392, 49 L.Ed.2d 342 (1976); State v. Brown, 98 Idaho 209, 560 P.2d 880 (1977). "[T]here are situations in which evidence is obviously of such substantial nature to the defense that elementary fairness requires it to be disclosed even without a specific request. For though the attorney for the sovereign *801 must prosecute the accused with earnestness and vigor, he must always be faithful to his client's overriding interest that `justice shall be done.'" United States v. Agurs, supra, 427 U.S. at 110-111, 96 S.Ct. at 2400-2401.
Due process requires that the accused be informed of exculpatory information in the prosecutor's possession.[2]Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963); State v. Merrifield, 109 Idaho 11, 704 P.2d 343 (Ct.App. 1985). See generally Note, The Prosecutor's Duty to Disclose Exculpatory Evidence, 14 IDAHO L. REV. 223 (1977). It is the duty of the prosecutor to make available all evidence which tends to aid in ascertaining the truth. State v. Harwood, 94 Idaho 615, 495 P.2d 160 (1972). See generally, Annotation, Right of Accused in State Courts to Inspection or Disclosure of Evidence in Possession of Prosecution, 7 A.L.R.3d 8 (1966). This right extends to the existence of witnesses important to the defense. Id.; Schwartzmiller v. State, 108 Idaho 329, 699 P.2d 429 (Ct.App. 1985).
However, this duty is imposed only if the evidence is exclupatory. The prosecution is not compelled to volunteer all information which may assist the defense in preparing for trial. State v. Horn, 101 Idaho 192, 610 P.2d 551 (1980).
We are compelled to agree with Simons that the information held by the jailer was exculpatory. That is, it tended to negate the guilt of the accused or would tend to reduce punishment. Evidence supporting an excuse of flight in fear of bodily harm might have been utilized by the defense either as a defense or in mitigation of the crime of second-degree murder. In addition, an awareness of the jailer's knowledge might have led defense counsel to other evidence. This information was in the possession of an employee of the sheriff's office, but was not made available to the defense.
However, the failure of the state to reveal exculpatory evidence will not result in a reversal unless the evidence is "material." In State v. Leatherwood, 104 Idaho 100, 656 P.2d 760 (Ct.App. 1982), we held that, when a defendant has been convicted at trial, withheld evidence is "material" only if, viewed in relation to all competent evidence admitted at trial, it appears to raise a reasonable doubt concerning the defendant's guilt. We urged adoption of this "unified standard of materiality" for all withheld-evidence cases. Failure to disclose such evidence is a denial of due process irrespective of the good or bad faith of the prosecutor. Brady v. Maryland, supra; State v. Leatherwood, supra.
Simons argues that the evidence withheld by the state was "material." She contends that the state's failure to supply this information resulted in her counsel being unable to effectively assist her in her choice of pleas. The standard for judging any claim of ineffective counsel is whether counsel's performance so undermined the proper functioning of the adversarial process that the proceedings cannot be relied on as having produced a just result. Strickland v. Washington, 466 U.S. 668, 104 S.Ct. 2052, 80 L.Ed.2d 674 (1984); Maxfield v. State, 108 Idaho 493, 700 P.2d 115 (Ct.App. 1985).
We note that the United States Supreme Court has recently held the Strickland incompetence-of-counsel test also applicable to determining the materiality of withheld information.[3]
We find the Strickland formulation of the Agurs test for materiality sufficiently flexible to cover the "no request," *802 "general request," and "specific request" cases of prosecutorial failure to disclose evidence favorable to the accused: The evidence is material only if there is a reasonable probability that, had the evidence been disclosed to the defense, the result of the proceeding would have been different. A "reasonable probability" is a probability sufficient to undermine confidence in the outcome.
United States v. Bagley, 473 U.S. 667, ___, 105 S.Ct. 3375, 3384, 87 L.Ed.2d 481 (1985).
At first blush it may appear that we need not reach Simons' argument, as we have held that a plea of guilty waives any right to disclosure of evidence by the prosecutor. See Schmidt v. State, 103 Idaho 340, 647 P.2d 796 (Ct.App. 1982). However, if exculpatory evidence is withheld and material, then as the tests are essentially the same, Simons was denied constitutionally guaranteed effective assistance of counsel and will not be bound by her plea. E.g. Zacek v. Brewer, 241 N.W.2d 41 (Ia. 1976). Thus we conduct our analysis according to the test as set forth in Leatherwood, Strickland and Bagley.
The Strickland test has two components. First, the defendant must show that counsel's performance was deficient. Second, the defendant must show that the deficient performance prejudiced the defendant. Strickland v. Washington, supra. The comments accompanying section 2.1(a)(ii) of the ABA STANDARDS RELATING TO PLEAS OF GUILTY (Approved Draft 1968), describe denial of effective assistance of counsel as including "those cases in which there has been a significant interference with retained or appointed counsel's opportunity to represent effectively his client's interests prior to receipt of the plea... ."
In this case, before entering her plea Simons already possessed her personal, albeit limited and confused, knowledge of the circumstances surrounding and preceding Jameson's death. Simons' counsel also had access to the reports of physicians who examined Simons following her initial incarceration. In addition, her counsel's investigation had generated sufficient historical evidence to stimulate consideration of a battered-woman defense.
We have reviewed the record and are not persuaded that defense counsel's performance was substantially hampered by the state's withholding of this information. The "battered-woman defense" has not been directly addressed by our appellate courts and is thus of questionable value. Simons' counsel conducted an otherwise thorough investigation of all possible defenses and mitigation possibilities. Although Simons' mental capacity was limited immediately after her arrest, she apparently had recovered sufficiently to assist in her own defense prior to entering her plea.
Simons' plea was in all other respects knowing, intelligent and voluntary. Simons pled guilty to the charge of involuntary manslaughter. It is well established that to be valid a plea must be made freely, voluntarily, and with an understanding of the consequences of the plea. State v. Mooneyham, 96 Idaho 145, 525 P.2d 340 (1974); Lockard v. State, 92 Idaho 813, 451 P.2d 1014 (1969). Simons was fully interrogated and informed by the district judge of the implications of her plea, in accordance with the standards set forth in State v. Howell, 104 Idaho 393, 659 P.2d 147 (Ct. App. 1983), and State v. Colyer, 98 Idaho 32, 557 P.2d 626 (1976). Other than to the extent that she and her counsel were unaware of the jailer's knowledge, Simons does not contend her guilty plea was otherwise involuntary or uninformed. The voluntariness of a plea can be determined only from consideration of all the relevant circumstances. State v. Turner, 95 Idaho 206, 506 P.2d 103 (1973). If a plea is voluntary, the trial court need not permit withdrawal of the plea. State v. Hinkley, 93 Idaho 872, 477 P.2d 495 (1970). Simons admitted all elements of the charge of involuntary manslaughter.
In addition, as noted earlier, Simons' counsel became aware of the jailer's knowledge during the sentencing hearing. A corollary of the prosecutor's duty to disclose *803 information is the defense counsel's duty to use due diligence in representing the defendant. See Annotation, Withholding or Suppression of Evidence by Prosecution in Criminal Case as Vitiating Conviction 34 A.L.R.3d 16 § 13 (1970). Simons' attorneys chose to utilize this evidence in mitigation at the sentencing hearing, instead of seeking a continuance and moving to withdraw the plea before sentence was pronounced. Simons has not alleged that the attorneys were ineffective for this reason. The choice was a tactical one which appellate courts ordinarily will not second-guess. The fact remains, however, that a stricter test is applicable to motions to withdraw a plea after a sentence has been pronounced.
Under these circumstances, we hold that the state's failure to disclose the jailer's information did not so prejudice Simons as to undermine confidence in the outcome of the proceedings. The district court did not abuse its discretion in finding no manifest injustice.
2. Sanction for prosecutor's conduct.
Alternatively Simons argues that the plea should be set aside as a form of sanction for prosecutorial misconduct. Simons would have us apply a rule analogous to the exclusionary rule to dissuade prosecutors from failing to disclose information during plea negotiations. Simons argues that other sanctions for professional misconduct are rarely applied and are insufficient to curb abuse. We believe that such a ruling is not warranted. The information withheld by the state did not substantially hamper Simons and her counsel in the plea bargaining process. We note again that where the defense counsel is rendered unable to provide effective assistance, due to the state's failure to disclose exculpatory and material evidence, a plea may be withdrawn by timely motion. We expect that prosecutors will comply with both the spirit and letter of the disclosure rule in seeking justice, making application of this rule a rare event.
II
Simons also challenges her ten-year indeterminate sentence as an abuse of the district court's discretion. She argues that probation would have been more appropriate than imprisonment. The choice of probation or confinement is committed to the sound discretion of the trial judge. State v. Toohill, 103 Idaho 565, 650 P.2d 707 (Ct.App. 1982). The record indicates that the sentencing judge was particularly concerned with the seriousness of the crime. In addition, he determined that imprisonment would be an appropriate punishment and could deter others. We cannot say that the court abused its discretion in choosing imprisonment instead of probation. See I.C. § 19-2521.
Ten years is the maximum term of imprisonment for involuntary manslaughter. A sentence within the statutory maximum will not be set aside absent an abuse of discretion. State v. Cotton, 100 Idaho 573, 602 P.2d 71 (1979). For purposes of our review of the reasonableness of an indeterminate sentence we deem the defendant's period of confinement to be one-third of the period, or forty months in this case. State v. Toohill, 103 Idaho 565, 650 P.2d 707 (Ct.App. 1982); see I.C. § 20-223. Although this was Simons' first offense, the crime appears to have involved a high degree of negligence. Simons admitted Jameson's death occurred when she was driving the vehicle while intoxicated. The record suggests that a sober individual exercising due care and ordinary vigilance would have been aware of the victim's presence and have taken appropriate steps to avoid doing serious harm.
A term of confinement is reasonable to the extent it appears necessary to accomplish the primary objective of protecting society and to achieve any or all of the related goals of deterrence, rehabilitation or retribution. State v. Toohill, supra. Here, during the extensive testimony at the sentencing hearing the court had an unusual opportunity to observe the defendant and to examine the possible aggravating and mitigating circumstances surrounding *804 the crime. Apparently the court was not persuaded that a likely possibility of rehabilitation existed. In sentencing Simons the judge also addressed the deterrence and retribution goals set forth in Toohill.
Having examined the record, we hold that the district court did not abuse its discretion either in determining that imprisonment was appropriate pursuant to the criteria of I.C. § 19-2521 or in deciding to impose a ten-year, indeterminate sentence. The order denying Simons' motion to withdraw her plea, and the judgment of conviction for involuntary manslaughter including the sentence imposed by the district court are affirmed.
BURNETT and SWANSTROM, JJ., concur.
NOTES
[1] We note that the crime of vehicular manslaughter carries a maximum of only seven years. I.C. § 18-4007(3). Simons plea bargained to involuntary manslaughter and has not challenged the application of this statute.
[2] Idaho Criminal Rule 16(a) also requires the prosecuting attorney to automatically disclose any information in his possession "which tends to negate the guilt of the accused as to the offense charged... ." We do not discuss Rule 16(a) separately because the prosecutor's responsibility under the due process clause and under Rule 16(a) appears to be coextensive. See Schwartzmiller v. State, 108 Idaho 329, 333 n. 3, 699 P.2d 429, 433 n. 3 (Ct.App. 1985); State v. McCoy, 100 Idaho 753, 605 P.2d 517 (1980).
[3] We recognize that Bagley is a plurality decision in this respect, but find its reasoning particularly persuasive in light of the Idaho approach to "materiality" articulated in Leatherwood. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2225428/ | 646 N.E.2d 693 (1995)
In re the WARDSHIP OF J.C.D.D., Appellant-Respondent,
v.
ALLEN COUNTY OFFICE OF FAMILY AND CHILDREN, Appellee-Petitioner.
No. 02A03-9404-JV-161.
Court of Appeals of Indiana, Third District.
February 14, 1995.
Rehearing Denied May 3, 1995.
*694 Thomas C. Allen, Fort Wayne, for appellant.
Jamie L. Thompson, Lebamoff Law Offices, Fort Wayne, for appellee.
OPINION
HOFFMAN, Judge.
Appellant-respondent D.D. appeals from the termination of his parent-child relationship with his son, J.C. The facts relevant to this appeal are set forth below. J.C. was born in 1985. The whereabouts of his mother are unknown.[1] In April 1992, D.D. temporarily placed J.C. with the Madison County Department of Welfare ("DPW") because he and J.C. had no place to live and D.D. was anticipating being arrested. After D.D. regained custody of J.C., the DPW soon discovered that D.D. and J.C. were living in a car and that D.D. was once more anticipating being arrested. The DPW took J.C. into protective custody and placed him in foster care.
In July 1992, the trial court found J.C. to be a child in need of services ("CHINS"). At that time, D.D. admitted to being unemployed since November 1991 and that he was unable to provide food, shelter, and medical care for J.C. After the CHINS determination, the DPW formulated a parent participation plan (the "Plan") for D.D. to follow to help him regain custody of J.C. The DPW instructed D.D. to: obtain psychological/social and drug/alcohol assessments, accept services from an outreach program, maintain consistent contact with J.C., pay support, maintain employment and independent housing, and refrain from further illegal activities. However, D.D. did not comply with the Plan.
On September 8, 1992, the DPW filed the Plan with the trial court and it was ordered on September 15, 1992. On December 29, 1993, the trial court terminated the parent-child relationship between D.D. and J.C. This appeal ensued.
The sole consolidated issue on appeal is whether there is sufficient evidence to terminate the parental rights of D.D. The right of a parent to raise his child, although of constitutional dimension, is not absolute. See Egly v. Blackford County DPW (1992), Ind., 592 N.E.2d 1232 (citing Lassiter v. Department of Social Services (1981), 452 U.S. 18, 101 S.Ct. 2153, 68 L.Ed.2d 640). When determining an appropriate disposition of a petition to terminate parental rights, the rights of a parent are subordinated to the child's best interest. Matter of Adoption of D.V.H. (1992), Ind. App., 604 N.E.2d 634, 636, trans. denied. In considering whether the evidence is sufficient to support a trial court's decision to terminate parental rights, this Court will neither reweigh the evidence nor judge the credibility of the witnesses. In re Wardship of R.B. (1993), Ind. App., 615 N.E.2d 494, 497. Only the evidence most favorable to the judgment will be considered. Id.
Specifically, D.D. contends there is insufficient evidence that the conditions which resulted in J.C.'s removal will not be remedied. See IND. CODE § 31-6-5-4(c)(2)(A) (1993 Ed.). To determine whether the conditions are likely to be remedied, the trial court must judge a parent's fitness to care for the child as of the time of the termination hearing and take into account any evidence of changed conditions. Odom v. Allen County DPW (1991), Ind. App., 582 N.E.2d 393, 395. It must also evaluate the parent's patterns of conduct to determine whether there is a substantial probability of future neglect or deprivation. Id.
D.D. first points out that he was incarcerated starting September 11, 1993. He argues that due to his imprisonment, the Plan as offered to the trial court was impossible for him to follow. D.D. also attributes fault for his noncompliance to the DPW for failing *695 to offer him "reasonable services" to assist him in regaining custody of J.C.
At the termination hearing, D.D. neither informed the court of his incarceration nor at any time objected to the terms of the Plan. Also, since July 1992, the DPW repeatedly explained to D.D. what was required of him to regain custody of J.C.
D.D.'s argument appears to be premised on the incorrect assumption that his cooperation with the DPW and his adherence to the Plan was necessary only after the trial court ordered his compliance. IND. CODE § 31-6-4-17 (1993 Ed.) provides, in pertinent part:
"[A] prosecutor, ... attorney for the county office of family and children, a probation officer, a caseworker, or the guardian ad litem or court appointed special advocate may sign and file a petition for the juvenile court to require the participation of a parent, guardian, or custodian in a program of care, treatment, or rehabilitation for the child... ."
(Emphasis added). The language of this statute makes it clear that a county department of public welfare retains discretion to decide whether or not to enter into a participation plan with parents. There is no requirement that it first petition and obtain approval by the trial court before formulating such a plan.
Moreover, prior to 1982 amendments to IND. CODE § 31-6-5-4 (1979 Ed.), termination of parental rights required a showing that "reasonable services [were] offered or provided to the parent[s] to assist [them] in fulfilling [their] parental obligations, and either [the parents] ... failed to accept them or they [were] ineffective." IND. CODE § 31-6-5-4 (1979 Ed.). However, as this language was specifically deleted in 1982 by legislative amendment, the requirement no longer exists. S.E.S. v. Grant County Dept. of Welfare (1991), Ind. App., 582 N.E.2d 886, 888 (adopted in S.E.S. v. Grant County Dept. of Welfare (1992), Ind., 594 N.E.2d 447). Thus, while a participation plan serves as a useful tool in assisting parents in meeting their obligations and while county departments of public welfare routinely offer services to assist parents in regaining custody of their children, termination of parental rights may occur independently of them, as long as the post-1982 elements of IND. CODE § 31-6-5-4 (1993 Ed.) are proved by clear and convincing evidence. See S.E.S., 582 N.E.2d at 889.
Here, although not required to do so, the DPW in the present case did, in fact, undertake considerable efforts to help D.D. meet the requirements for D.D.'s successful reunion with his son. The DPW's efforts included: arranging for visitation at the DPW, assisting him in obtaining employment, placing him with independent housing pursuant to the Wayne Township Self Sufficiency Program (SSP), and offering him other programs and drug testing through the CASI Center.
Despite the efforts of the DPW, however, D.D. failed to comply with any of the above instructions prior to his incarceration. His noncompliance was his own fault, more specifically, his own persistent refusal and inaction to comply. D.D. failed to attend a single visitation between June and September of 1992. After less than a month at his employment, he was fired because he was arrested. Additionally, D.D. was evicted from the SSP for stealing from the cashbox and violating other program rules. Although D.D. failed to obtain the required substance abuse and psychological assessments prior to his incarceration, his use of drugs and alcohol was nonetheless established at the termination hearing through his own admission to abusing alcohol and crack-cocaine between December of 1991 and September 1992.
Further, D.D. told caseworkers that if he were required to endure any more services to regain custody of J.C., they could keep him. At times his concern was focused on what would happen to him if he chose to relinquish custody of J.C. Even after his incarceration, he continued in his failure to abide by the instructions of the DPW by failing to utilize established procedures to contact J.C.
The evidence also discloses that D.D. has a pattern of criminal behavior, with several arrests since June 1992. His last conviction *696 for armed robbery resulted in his present incarceration. D.D's earliest release date is August 1996. His latest release date is August 2000. D.D.'s current incarceration makes it impossible for him to see to the upbringing of J.C. His pattern of criminal behavior makes it unlikely that he will be able to do so in a meaningful way in the future. See Matter of Danforth (1989), Ind., 542 N.E.2d 1330; B.R.F. v. Allen County DPW (1991), Ind. App., 570 N.E.2d 1350, 1352. Consequently, there is sufficient evidence the conditions which resulted in J.C.'s removal will not be remedied. See IND. CODE § 31-6-5-4(c)(2)(A). Moreover, at the termination hearing, the DPW presented evidence that termination will be in the best interest of J.C. as he has developed emotional problems requiring medical attention and counsel, none of which D.D. can provide.
The trial court properly terminated D.D.'s parental rights with respect to J.C. Accordingly, the decision of the trial court is affirmed.
Affirmed.
GARRARD and ROBERTSON, JJ., concur.
NOTES
[1] Her parental rights were also terminated on December 29, 1993. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/8326630/ | Connolly, Thomas E., J.
This civil action under G.L.c. 30A, §14 is brought by the plaintiff, Michael Santos (“Santos”), for judicial review of a decision of the Board of Appeal on Motor Vehicle Liability Policies and Bonds (“Board”) dated May 4, 2011. The Registrar of Motor Vehicles (“Registrar”) had suspended Santos’ driver’s license for three years, and Santos took an appeal to the Board, which after hearing, affirmed the action of the Registrar.
BACKGROUND
On May 9, 2002, Santos was arrested for operating a motor vehicle while under the influence of alcohol (“OUI”) in violation of G.L.c. 90, §24(l)(a)(l). On June 4, 2002, in Palmer District Court, Santos admitted to sufficient facts to warrant a finding of guilty for the OUI charge. Under G.L.c. 90, §24D, Santos was placed on probation for one year, assigned to an alcohol education program, and required to pay a fine and a surfine. The case was continued without a finding (“CWOF”) until June 3, 2003 and was dismissed on December 16, 2003.
Santos was arrested again for OUI on September 25, 2010 in Brighton. Santos refused to submit to a Breathalyzer test. Citing G.L.c. 90, §24(l)(f)(l), the Registrar immediately suspended Santos’ driver’s license for a period of three years.
Santos appealed the Registrar’s decision to the Board, claiming that the 2002 admission to sufficient facts and CWOF is not a “conviction” within the meaning of G.L.c. 90, §24(1)(f)(1) that would trigger the enhanced penalty1 for refusing a Breathalyzer test.
The Board determined that a CWOF is a “conviction” for purposes of the enhanced penalty under G.L.c. 90, §24(l)(f)(l). The Board pointed out that in 2005, the Legislature passed “Melanie’s Law,” which increased penalties for drunk drivers because it was “necessary for the immediate preservation of the public safely.” St. 2005, c. 122. The amendments passed by the Legislature in 2005 included an increase in the license suspension periods in G.L.c. 90, §24(l)(f)(l) for persons who refuse to submit to a chemical analysis at the time of arrest and who have been previously convicted of an OUI. The Board stated that:
It defies logic that the Legislature would proceed with emergency legislation that significantly enhanced the penalties of driving drunk, only to weaken the mandate by failing to include a CWOF as a prior OUI offense.
(Emphasis in original.)
DISCUSSION
Santos, as the appealing party, bears the burden of demonstrating the invalidity of the board’s decision. Merisme v. Board of Appeals on Motor Vehicle Liab. Policies & Bonds, 27 Mass.App.Ct. 470, 474 (1989). In reviewing the board’s decision, “[t]he interpretation of a statute by the agency charged with primary responsibility for administering it is entitled to substantial deference.” Gateley’s Case, 415 Mass. 397, 399 (1993); see Berrios v. Department of Public Welfare, 411 Mass. 587, 595 (1992) (noting that an administrative agency has “considerable leeway in interpreting a statute it is charged with enforcing”).
The question to be decided here is whether Santos’ 2002 admission to sufficient facts to warrant a finding of guilty, CWOF, and eventual dismissal of the case constitutes a previous “conviction” under G.L.c. 90, §24(l)(f)(l) and allows for a three-year license suspension for his refusal to take a Breathalyzer test on September 25, 2010.
Chapter 90, §24(l)(f)(l) provides that
Whoever operates a motor vehicle upon any way or in any place to which the public has right to access .. . shall be deemed to have consented to submit to a chemical test or analysis of his breath or blood in the event that he is arrested for operating a motor vehicle while under the influence of intoxicating liquor ... If the person arrested refuses to submit to such test of analysis ... no such test or analysis shall be made and he shall have his license or right to operate suspended ... for a period of 180 days; provided, however, that any person . . . who has been previously convicted of a violation under this section . .. shall have his license or right to operate suspended forthwith for a period of 3 years for such refusal. . .
*150Chapter 90, §24(l)(d) defines the term “conviction” as follows:
For purposes of subdivision (1) of this section, a person shall be deemed to have been convicted if he pleaded guilty or nolo contendere or was found or adjudged guilty by a court of competent jurisdiction, whether or not he was placed on probation without sentence or under a suspended sentence or the case was placed on file . . .
Massachusetts Rule of Criminal Procedure 12(a)(2) provides that “[i]n a District Court, a defendant may, after a plea of not guilty, admit to sufficient facts to warrant a finding of guilty.” The defendant may then request a specific disposition, including that a guilty finding not be entered and that the court continue the case without a finding of guilt. G.L.c. 278, §18. If the court grants the CWOF, the case will be continued until a later date when it will be dismissed, provided that the defendant complies with specific conditions set by the court. Id. Thus, the nature of an admission to sufficient facts to warrant a finding of guilty followed by a CWOF produces a result that “falls somewhere between guilt and complete innocence.” Commonwealth v. Norwell, 423 Mass. 725, 726 (1996) (“Part of the disposition (finding of sufficient facts) suggests the defendant’s guilt, while the remaining part (continuance without formal finding of guilt for eventual dismissal) allows the defendant to have the entire slate wiped clean if there is compliance with any terms imposed in connection with the continuance and no other criminal misconduct. The disposition might aptly be described as making the criminal charge ‘evanescent’ — here today, but gone in the future”).
The court cannot imagine, given the purpose of Melanie’s Law, which increased penalties for drunk drivers, that the Legislature intended a defendant’s admission of sufficient facts to warrant a finding of guilty not to trigger the enhanced penally under G.L.c. 90, §24(l)(f)(l). As the Board stated: “It defies logic and common sense that the Legislature would draft and enact emergency legislation designed to significantly increase sanctions for the refusal of the breathalyzer, while creating a selective omission that drastically weakens the original intent.”
This interpretation is supported by the usual treatment of an admission to sufficient facts to warrant a finding of guilly as a plea of guilty. See Luk v. Commonwealth, 421 Mass. 415, 418 n.6 (1995) (OUI case); see also G.L.ch. 278, §18 (“If a defendant. . . attempts to enter a plea or statement consisting of an admission of facts sufficient for a finding of guilt, or some similar statement, such admission shall be deemed a tender of a plea of guilty for purposes of the procedures set forth in this section”); Commonwealth v. Furr, 454 Mass. 101, 101 n.1 (2009); Mateo v. U.S., 398 F.3d 126, 128 n.3 (1st Cir. 2005) (interpreting state law); U.S. v. Morillo, 178 F.3d 18, 21 (1st Cir. 1999) (same); Kent B. Smith, Criminal Practice and Procedure, Mas--sachusetts Practice, Vol. 30A, §23.12, p. 282-83 (3rd Ed., 2007); see also Mass.R.Crim.P. 12(a)(2), Reporter’s Notes (2004 rev.) (defendant’s offer to admit to sufficient facts triggers essentially same safeguards required when defendant offers to plead guiliy).2
Santos argues that since the words “admission to sufficient facts” do notappear in Chapter 90, §24(l)(d), the Legislature must have meant to exclude it as a trigger for the enhanced suspension. The simple answer to Santos’ argument is that “admission to sufficient facts” does not need to be in the statute because it has been consistently held that an admission to sufficient facts to warrant a finding of guilty is treated as a plea of guilty. See Furr, 454 Mass. at 101 n.1; Luk, 421 Mass at 418 n.6; Mateo, 398 F.3d at 128 n.3; Morillo, 178 F.3d at 21. The Legislature is presumed to be aware of existing law and prior decisions of appellate courts when it enacts legislation. See Providence and Worcester R.R. Co. v. Energy Facilities Siting Bd., 453 Mass. 135, 144 (2009). Thus, this Court assumes that the Legislature knew of G.L.c. 278, §18 and the Supreme Judicial Court’s interpretation of an admission to sufficient facts as being tantamount to a guilty plea and there was no need to add “admission to sufficient facts” to the definition of “conviction.” The court finds that the Board reasonably interpreted the language of G.L.c. 90, §24(l)(f)(l) and §(l)(d) as including an admission to sufficient facts followed by a CWOF as a “conviction” for purposes of the enhanced license suspension.
ORDERS
After hearing and review of all submissions, the Court enters the following ORDERS:
1. The plaintiff, Michael Santos’ Motion for Judgment on the Pleadings under Mass.R.Civ.P. 12(c) is DENIED.
2. The Decision, Findings and Order of the Defendant, Board of Appeal on Motor Vehicle Liability Policies and Bonds dated March 30, 2011 is AFFIRMED.
3. Judgment shall be entered for the Defendant, Board of Appeal on Motor Vehicle Liability Policies and Bonds.
A three-year suspension instead of a 180-day suspension.
But see Commonwealth v. Villalobos, 437 Mass. 797 (2002) (dealing with immigration warnings under G.L.c. 278, §29D). In Villalobos, the SJC distinguished between an “admission” where the conditions of the CWOF have yet to be complied with and an “admission” where the conditions of the CWOF have been complied with and the charge has been dismissed. Id. at 800-02. Specifically, if a defendant violates the conditions of the CWOF, his “admission” may “ripen into an adjudication of guilt and imposition of sentence.” Id. at 801. ‘Thus, where an admission to sufficient facts may lead to either an immediate conviction and sentence, or may do so during the continuance period in the event of a violation of the continuance terms, it remains appropriate to treat an admission to sufficient facts as the equivalent of a plea of guilty for purposes of G.L.c. 278, §29D." Id. However, “an admission to sufficient facts in order to obtain a continuance *151without a finding [does] not, absent a violation of the continuance terms, result in a ‘conviction’ for Federal immigration purposes.” Id. at 802. See also Commonwealth v. Bartos, 57 Mass.App.Ct. 751, 756 (2003) (“A conflating of admission to facts with guilty plea is also suggested by the occasional characterization of admission to facts as the ‘functional equivalent’ of a guilty plea . . . But perhaps the reference .. . should be read as shorthand for admission followed by finding and sentence for breach of the conditions of continuance”); Commonwealth v. Bergquist, 51 Mass.App.Ct. 53, 56 (2001) ("[A] continuation without a finding differs from a conviction . . . Until such time as a finding of guilty is entered on the docket, there is no conviction. If the defendant had complied with the conditions imposed, the complaint would have been dismissed and he would have avoided the consequences of a criminal conviction on his record”). | 01-03-2023 | 10-17-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/2252931/ | 732 F.Supp. 556 (1989)
Phillip and Brenda GUIDICE, et al., Plaintiffs,
v.
BFG ELECTROPLATING AND MANUFACTURING CO., INC., et al., Defendants.
Civ. A. No. 86-2093.
United States District Court, W.D. Pennsylvania.
September 1, 1989.
*557 Richard D. Fox, Philadelphia, Pa., Ronald Simon, Washington, D.C., and Edward Specter, Pittsburgh, Pa., for Phillip and Brenda Guidice, et al.
J.W. Montgomery, III, Pittsburgh, Pa., for Season-All and Jeffy Grube.
Richard J. Federowicz, Pittsburgh, Pa., for BFG.
Eric A. Schaffer and Bradley S. Tupi, Pittsburgh, Pa., for National Bank of the Commonwealth.
Charles Kirshner, Pittsburgh, Pa., for Berlin Metals.
MEMORANDUM AND ORDER
McCUNE, Senior District Judge.
We consider the National Bank of the Commonwealth's motion for summary judgment. We have jurisdiction pursuant to 42 U.S.C. § 9613(b) and 28 U.S.C. § 1331. For reasons set forth below the motion will be denied.
I. PROCEDURAL HISTORY
The procedural history of this action is somewhat complicated as it has journeyed through two district court judges and now rests in the hands of a third.
In October 1986, residents of the Borough of Punxsutawney, Pennsylvania (Borough) commenced action against BFG Electroplating and Manufacturing Company (BFG). Plaintiffs alleged that BFG unlawfully contaminated the environment causing personal injuries. Also asserted by plaintiffs are claims for "response costs" as defined by the Comprehensive Environmental Response, Compensation and Liability Act of 1980, 42 U.S.C. §§ 9601, et seq.
BFG then filed a third-party complaint against current and past owners of adjacent land known as the "Berlin Property" in December 1986. BFG sought indemnification, contribution and response costs from those owners including the National Bank of the Commonwealth (Bank) as an eight-month record title owner of the Berlin Property.
On February 25, 1987, the Bank filed a motion to dismiss the third-party complaint. Plaintiffs filed a Rule 14 claim against the Bank and other third-party defendants on August 8, 1988. On September 24, 1987, Judge Dumbauld granted the Bank's motion *558 and later denied BFG's motion for reconsideration in an order dated October 26, 1987.
On October 5, 1987, in response to an October 1987 written request of the Bank, Judge Dumbauld dismissed plaintiffs' Rule 14 claim. The October 5th order was not served on the parties. Plaintiffs responded to the Bank's letter by requesting that a proper motion be made by the Bank and plaintiffs be afforded an opportunity to respond. The Bank, also unaware of the October 5th order, filed a motion to dismiss plaintiffs' Rule 14 claim against the Bank on November 20, 1987. Three days later Judge Dumbauld issued a second order dismissing the claim with prejudice.
The case was reassigned to Judge Simmons in December, 1987.
In early 1988, BFG and plaintiffs filed motions to vacate the order dismissing the Rule 14 claim against the Bank. Additionally BFG moved to strike the orders dismissing its third-party complaint and motion for reconsideration. The Bank made a Rule 54(b) motion for findings regarding dismissal of the aforementioned Rule 14 claim and third-party complaint. At a March 26, 1988 hearing Judge Simmons orally vacated those portions of Judge Dumbauld's orders concerning plaintiffs' Rule 14 claim against the Bank on due process grounds. (Tr. pp. 2-7).
In late September 1988 the case was reassigned to the undersigned.
The Bank filed its motion for summary judgment in April 1989. Opposing briefs were filed by plaintiffs and BFG. The Bank filed reply briefs.
II. FACTS
A. HISTORY OF BANK'S RELATION WITH BERLIN METAL AND BANK'S OWNERSHIP OF THE BERLIN PROPERTY
During the 1970's Berlin Metal Polishers (Berlin Metal) operated a metal polishing company at the Berlin Property. Berlin Metal was managed and owned by the Runco family (Runcos).
In May 1971 the Bank approved a line of credit for Berlin Metal secured by assignment of accounts receivable. Several extensions and renewals of this line of credit were approved by the Bank from May 1971 through September 1975.
On September 8, 1975, the Bank approved a loan to construct a new treatment facility to satisfy Pennsylvania Department of Environmental Resources (PaDER) requirements secured by a mortgage on the Berlin Property. Subsequently the Bank approved additional lines of credit and two two-year installment loans. During the course of the loans and lines of credit the Bank received periodic financial statements.
By 1980, Berlin Metal had defaulted on its obligations to the Bank. In January 1980 Bank representatives toured Berlin Metal and met with plant officials to discuss management. At that meeting the Bank representatives were informed of the number of work shifts, the status of Berlin Metal's accounts, the composition of the management and the presence of raw materials. The Bank proposed and the plant management agreed that Berlin Metal take out a loan guaranteed by the Small Business Administration (SBA) to pay off monies owed the Bank on the mortgage and lines of credit. The loan was also to allow for working capital.
In March 1980, on behalf of Berlin Metal, the Bank submitted with recommendation of approval the loan application to the SBA.
On April 9, 1980, the Bank confessed judgment against Berlin in the amount of $164,000.
Through the efforts of Dominic Runco, Sr. the Bank was apprised of potential purchasers of the Berlin equipment and/or the Berlin facility as early as June 1980. However, those efforts did not come to fruition in part because Berlin could not obtain a permanent permit to use the Borough sewer.
In response to the Bank's July 1980 inquiry, the PaDER sent information concerning a May 1979 fish kill in Mahoning Creek which was attributed to a cyanide discharge from the Borough sewage treatment *559 plant. Samples taken at the Berlin and BFG facilities showed cyanide and heavy metal discharge in excess of Borough Ordinance limits.
According to Bank file memoranda, Bank credit officer Barbara Kay was in direct contact with prospective purchaser Bruce Armstrong. Armstrong advised Kay of his efforts to obtain approval from PaDER of his proposal to dump directly into the creek. Kay independently communicated with Borough officials as to the status of the Borough's acceptance of Berlin discharge. She learned that any new owner of the Berlin facility would have to apply directly to the PaDER for approval to dump into the creek. In the meantime, Berlin was permitted to use the sewer service with monitoring of its discharge commencing January 1981.
In January 1981 the Runcos requested a meeting with the Bank to discuss the future of Berlin Metal. At that meeting Dominic Runco, Sr. expressed an interest in repurchasing the business from his family, but was concerned about the outstanding debt against the business and property. Possible liquidation of the business was also discussed.
In February 1981 an agent of the Bank visited the Berlin facility with Anthony Runco. In a written report the agent noted that no one was working and there was no heat or light. Water dripped from the ceiling. He observed 35 drums of chemicals and large tanks, some containing acid, which appeared rusty.
A March 1981 Bank memorandum summarized the outstanding debt of Berlin Metal. Because the account was six months delinquent and the business closed, it was recommended that the Bank execute on the April 9, 1980 judgment. On June 3, 1981, the Bank filed a complaint and mortgage foreclosure against the Berlin facility and received judgment on June 22, 1981.
On July 13, 1981, Bank president James Trimarchi suggested a meeting to discuss settlement of Berlin's outstanding loans with the Bank.
On September 28, 1981, at the Bank's request a meeting was held with Bank officials, the Runcos and counsel for Berlin in an effort to reach a settlement.
A series of settlement proposals beginning October 1981 culminated in a written agreement between the Bank and Runcos dated January 21, 1982. The agreement contemplated a foreclosure sale of the Berlin Property with the possibility that if Colomba Runco, the ex-wife of Dominic Runco, Sr., were the successful purchaser, the Bank would provide financing.
At the sheriff's sale on April 16, 1982, the Bank purchased the Berlin Property for $145,000. The deed to the Berlin Property was delivered to the Bank May 14, 1982.
During the Bank's ownership the Bank paid insurance premiums and property taxes for the Berlin property.
Pursuant to a trust created by Colomba and Anthony Runco, trustee Russell D'Aiello was directed to acquire title to the Berlin Property. D'Aiello was further directed to rent the premises, make mortgage payments to the Bank out of the rent proceeds, and distribute any surplus proceeds to Mrs. Runco and Anthony Runco. The Bank conveyed the property to D'Aiello as trustee on January 21, 1983. The Bank informed Season-All, a tenant, in February 1983 that pursuant of the purchase financing, the lease checks were to be submitted directly to the Bank.
B. SEASON-ALL'S INVOLVEMENT WITH THE BERLIN PROPERTY AND THE BANK
In July 1981 Bank president James Trimarchi was approached at a social gathering by a representative of Season-All who expressed an interest in leasing the Berlin Property. To this end on July 13, 1981, Trimarchi forwarded a lease submitted by Season-All for the rental of a portion of the Berlin building to counsel for Berlin. Trimarchi advised Berlin that if it wished to execute the lease, it should contact Steve Garland of Season-All.
The lease between Berlin Metal and Season-All was executed on August 27, 1981. Season-All used the space for housing raw materials used in its window manufacturing operation. When Season-All took possession *560 of a portion of the Berlin Property, the entire property was vacant.
On December 17, 1981, Season-All and Berlin executed a second lease involving the entire Berlin premises. Season-All wanted to use the additional space for the manufacture of casement windows. In March or April of 1982 Season-All took possession of the entire Berlin premises.
Initially Season-All paid its rent to Dominic Runco, Sr. In December 1981 the parties agreed that Season-All would remit its rental payments directly to the Bank to be credited to the outstanding debt of Berlin Metal.
By January 1982 Season-All was aware that the Bank was considering foreclosure on the Berlin Property. Season-All asked the Bank to assure that it would honor Season-All's lease with Berlin if the Bank acquired title at the foreclosure sale. Accordingly, on February 3, 1982, the Bank and Season-All entered into an agreement which provided that the Bank would subordinate its lien on the Berlin Property to the leasehold interest of Season-All.
C. REMOVAL OF CHEMICAL DRUMS FROM THE BERLIN PROPERTY
When Season-All took possession of the entire Berlin premises in the spring of 1982, there were several drums of chemicals present in the Berlin building left by Berlin Metal. Donald Jeffries of Season-All contacted Dominic Runco, Sr., making several requests that he remove the leftover materials. Runco said he was contacting someone to remove the materials, but he never did so.
Prior to the Bank's foreclosure, Season-All informed the Bank that it would withhold rent if the drums were not removed.
On April 22, 1982, a representative of the PaDER visited the Berlin Property, inventoried the drums of leftover materials from Berlin Metal, and declared some of them to be hazardous wastes. The PaDER sent the Bank and Season-All the results of the inventory by letters dated April 23, 1982. The PaDER requested the Bank to contract with a hazardous waste transporter and a hazardous waste disposal facility. Jeffries testified that although several of the drums were in poor condition and some had open tops, they were not leaking.
Within a week or two, Dominic Runco, Jr. removed 12 to 15 containers approved for his removal and use by the PaDER.
The Bank agreed to provide Berlin Metals with financing for the purpose of enabling Berlin to have the drums removed. The removal cost was to be added to the principal of the Runco's debt to the Bank upon their planned repurchase of the property.
At the Bank's request, Jeffries contacted Ecology Chemical and Refining Company to remove the waste from the Berlin Property. Ecology removed 26 drums on September 15-16, 1982. The transportation manifests signed by Anthony Runco identify Berlin Metal as the generator.
On September 21, 1982, Ecology invoiced Berlin for the removal costs of approximately $20,000. In January 1983, an Ecology letter looked to the Bank for the reimbursement. The Runcos paid half of the bill while the Bank paid the other half as part of the settlement of the Berlin debt.
III. DISCUSSION
As a preliminary matter the Bank argues that the doctrine of the law of the case applies and that we are therefore precluded from reconsidering orders dismissing plaintiffs' claims. However, it is clear from the transcript of the March 26, 1988 hearing before Judge Simmons that those portions of Judge Dumbauld's orders concerning dismissal of plaintiffs' rule 14 claim against the Bank were vacated. Therefore, the doctrine does not have application now. Judge Simmons has already disregarded Judge Dumbauld's order as to the Rule 14 complaint at least.
The Bank also argues that BFG lacks standing to oppose this motion because Judge Dumbaulf dismissed BFG's third-party complaint on September 24, 1987 and denied reconsideration in an order dated October 26, 1987. BFG filed a motion to strike the aforementioned orders on *561 January 19, 1988. We retain the authority to revise the orders.
Under Rule 56 of the Federal Rules of Civil Procedure the moving party is entitled to judgment as a matter of law if the movant demonstrates that there is no genuine issue of material fact. Summary judgment is proper "[w]here the record as a whole could not lead a rational trier of fact to find for the non-moving party." Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). To sustain a motion for summary judgment we must resolve all inferences from the underlying facts in the light most favorable to the non-moving party. Id.
In order for the Bank to succeed in its motion for summary judgment, the Bank must establish that it has no liability under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, (CERCLA), Pub.L. No. 96-510, 94 Stat. 2767 (1980), codified in part as amended at 42 U.S.C. §§ 9601-9675 (West 1983 and Supp.1989).
CERCLA imposes liability on four classes of potentially responsible parties: (1) current owners or operators of hazardous waste sites; (2) those persons who owned or operated the site at the time of disposal; (3) hazardous waste generators who arranged for disposal or treatment of their waste at the site; and (4) transporters of the hazardous waste to a site from which there is a release or threatened release. 42 U.S.C. § 9607(a). These persons are potentially liable for the costs incurred as a result of "a release, or a threatened release ... of a hazardous substance" from the facility. Id. The party does not need to be both an owner and an operator to be liable under CERCLA. Artesian Water Co. v. Government of New Castle County, 659 F.Supp. 1269, 1280 (D.Del.1987), affirmed, 851 F.2d 643 (3d Cir.1988).
The parties agree that the main issue is whether the Bank is a potentially responsible defendant as a former owner or operator of the Berlin Property when there was a disposal of hazardous wastes. There are two time frames in which we must consider whether the Bank was an "owner or operator" of the Berlin Property: the period prior to the Bank's foreclosure and purchase of the Berlin Property and the period of the Bank's ownership.
A. LIABILITY OF THE BANK PRIOR TO ITS PURCHASE OF THE BERLIN PROPERTY
Congress provided an exception to liability as an "owner or operator" of a hazardous site for "a person who, without participating in the management of a ... facility, holds indicia of ownership primarily to protect his security interest in the ... facility." 42 U.A.C. § 9601(20)(A) (West Supp.1989). Under Pennsylvania law, the holding of a mortgage constitutes an indicia of ownership. See Reconstruction Finance Corporation v. Northern Trust Co., 98 F.2d 555, 556 (3d Cir.1938).
The existing case law suggests that, prior to foreclosure, a mortgagee is exempt from CERCLA liability under 42 U.S.C. § 9601(20)(A) so long as the mortgagee did not participate in the managerial and operational aspects of the facility. United States v. Mirabile, 15 Envtl.L.Rep. (Envtl. L.Inst.) 20992, 20995, 1985 WL 97 (E.D.Pa. Sept. 4, 1985); United States v. Fleet Factors Corp., 724 F.Supp. 955 at 960 (S.D. Ga.1988); United States v. Nicolet, Inc., 712 F.Supp. 1193 at 1204 (E.D.Pa.1989).
Interpretation of "participating in the management" and "primarily to protect is security interest" has permitted secured creditors "to provide financial assistance and general, and even isolated instances of specific management advice to its debtors without risking CERCLA liability if the secured creditor does not participate in the day-to-day management of the business or facility either before or after the business ceases operation." United States v. Fleet Factors Corp., 724 F.Supp. 955; see also, United States v. Mirabile. The question we address is whether the Bank had passed the point of protecting its security interest and was participating in the management or control of Berlin Metals.
The Bank held a mortgage on the Berlin Property between October 1975 and April *562 16, 1982, the date of foreclosure. Several additional loans and lines of credit secured by additional mortgages on the Berlin facility or the accounts receivable by Berlin Metals were issued by the Bank during that period. The Bank received periodic financial statements.
After Berlin Metal defaulted on its loan obligations, the Bank took steps to protect its interest in the Berlin Property. These steps included a January 1980 meeting with Berlin officials where the Bank was informed of such things as the status of Berlin accounts, personnel changes and the presence of raw materials. Bank officials met with Berlin officials and actively assisted Berlin in its application for a loan from the SBA. Communications with the PaDER and Borough officials were initiated by the Bank in 1980 in an effort to assist Berlin with wastewater discharge compliance.
After operations at the Berlin Property ceased in early 1981, a Bank agent visited the property and reported the results of his inspection to the Bank. A series of meetings transpired between the Bank and Runcos concerning the restructuring of Berlin Metals' loans. The Bank referred a potential lessee, Season-All, to the attorney representing the Runcos.
In January 1982 the Bank and Runcos arrived at an agreement whereby the Bank would provide financing if Colomba Runco were the purchaser at a subsequent foreclosure sale.
We regard these activities prior to foreclosure insufficient to void the security interest exemption of CERCLA. There is no evidence suggesting that the Bank controlled operational, production, or waste disposal activities at the Berlin Property. See e.g., Idaho v. Bunker Hill Co., 635 F.Supp. 665, 672 (D.Idaho 1986) (Corporate parent with capacity and reserved authority to make decisions and implement actions and mechanisms to prevent and abate damage caused by disposal and releases of hazardous wastes of its subsidiary found liable under CERCLA.) The actions of the Bank prior to its purchase of the Berlin Property at the foreclosure sale were prudent measures undertaken to protect its security interest in the property.
There are policy reasons for exemption of secured creditors in the Bank's position from CERCLA liability prior to the secured creditor's purchase of the property at foreclosure. A goal of CERCLA is safe handling and disposal of hazardous waste. To encourage banks to monitor a debtor's use of security property, a high liability threshold will enhance the dual purposes of protection of the banks' investments and promoting CERCLA's policy goals. Conversely, a low liability standard would encourage a lender to terminate its association with a financially troubled debtor and expedite loan payments in an effort to recover the debts.[1]
B. LIABILITY OF THE BANK AFTER ITS PURCHASE OF THE BERLIN PROPERTY
There is a divergence in case law as to whether the security interest exemption is applicable when a secured creditor purchases its security interest at a foreclosure sale. The two principal decisions, United States v. Mirabile, 15 Envtl.L.Rep. (Envtl. L.Inst.) 20992 (E.D.Pa. Sept. 4, 1985) and United States v. Maryland Bank & Trust Co., 632 F.Supp. 573 (D.Md.1986), approach the issue of lender liability from different directions.
The focus in Mirabile was whether a lender is precluded from invoking the security interest exemption rather than whether the exemption applies in the first place. There, one of the secured creditors, American Bank, foreclosed on and took title to a defunct business that had created a hazardous waste. Four months later American Bank sold the site to the Mirabiles. When the EPA sued the Mirabiles to *563 recover its clean-up costs, the Mirabiles joined American Bank as a third-party defendant. During its four-month ownership American Bank took steps to secure the property, showed the property to prospective purchasers, and made inquiries as to the removal of the drums of hazardous waste.
The Mirabile court found that regardless of the nature of title American Bank received, the actions after foreclosure were undertaken merely to protect its security interest in the property and did not constitute an attempt to participate in the management of the site. Mirabile, 15 Envtl.L.Rep. at 20,996. Thus, exemption from CERCLA liability applied as long as a lender limited its activities to the financial aspects of management and did not become too embroiled in the "nuts-and-bolts, day-to-day production aspects of the business". Id. at 20,995. Foreclosure and repurchase were natural consequences in protection of a security interest.
The Maryland Bank & Trust court held that when a mortgagee becomes an owner of the property, the security interest exemption is lost. There, Maryland Bank foreclosed on the mortgage, took title and had owned the property for nearly four years when the EPA sued for recovery costs. Through examination of the statutory language of 42 U.S.C. § 9601(20)(A) the court determined that the use of the present tense indicated the security interest must exist at the time of clean-up. Maryland Bank & Trust, 632 F.Supp. at 579.
The court reasoned that the purpose of the security exemption was to protect secured lenders in common law states where the mortgagee holds legal title to the mortgaged realty until satisfaction of the underlying loan obligation. Id. Furthermore, the court found that exemption of Maryland Bank would contradict the policies underlying CERCLA. If Maryland Bank were exempted from liability, the federal government would shoulder the clean-up costs while the bank would enjoy a windfall by the increased value of the improved land and a possible sale at a profit. Id. at 580. Extending the interest exemption to lenders holding full title to properties would frustrate the distribution of clean-up costs achieved by CERCLA as well as reallocate the risks assumed in owning real property. Id.
The 1986 amendments to CERCLA lend support to the narrow reading of the security interest exemption in Maryland Bank & Trust. State and local governments acquiring "ownership or control involuntarily through bankruptcy, tax delinquency, abandonment" or similar means were excluded from liability as owners or operators. 42 U.S.C. § 9601(20)(D) (West Supp.1989). "Any person who owned, operated, or otherwise controlled activities at [the] facility immediately beforehand" are held liable. 42 U.S.C. § 9601(20)(D) (West Supp.1989). That Congress did not simultaneously amend the statute to exclude from liability lenders who acquire property through foreclosure might indicate that Congress intended to hold them liable as owners. See Tom, Interpreting the Meaning of Lender Management Participation Under Section 101(20)(A) of CERCLA, 98 Yale L.J. 925, 926 (1989).
We find the concern expressed in Maryland Bank & Trust, that an exemption for landowning lenders would create a special class of otherwise liable landowners, and the failure of the 1986 amendments to specifically exempt mortgagees-turned-land-owners persuasive. When a lender is the successful purchaser at a foreclosure sale, the lender should be liable to the same extent as any other bidder at the sale would have been.
In the instant action we find that the security interest exemption of 42 U.S.C. § 9601(20)(A) does not apply for the period the Bank was record owner of the Berlin Property. During that period the Bank was a potentially responsible party as defined in 42 U.S.C. § 9607(a)(2).
C. THE EXISTENCE OF A DISPOSAL OF HAZARDOUS WASTE DURING THE BANK'S OWNERSHIP OF THE BERLIN PROPERTY
Rule 56(c) of the Federal Rules of Civil Procedure mandates that the nonmoving *564 party must "make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). As part of its prima facie case, a claimant must demonstrate that a release or threatened release of hazardous substances from the site has occurred. Artesian Water Co. v. Government of New Castle County, 659 F.Supp. at 1278; Maryland Bank & Trust Co., 632 F.Supp. at 576. A former owner or operator is liable under CERCLA only if hazardous wastes were disposed of during the time that person owned or operated the site. 42 U.S.C. § 9607(a)(2); Cadillac Fair View/Cal., Inc. v. Dow Chem. Co., 21 Env't Rep.Cas. (BNA) 1108, 1113 (C.D.Cal. Mar. 5, 1984). The Bank maintains that BFG and plaintiffs have failed to meet their burdens of proof in this regard.
The terms "release" and "disposal" have broad definitions. Although the definitions are not synonumous, leakage of hazardous waste into the environment is a common element.[2] It is important to recognize that "disposal" is not limited to a one-time occurrence. "[T]here may be other disposals when hazardous materials are moved, dispersed, or released during landfill excavations and fillings." Tanglewood East Homeowners v. Charles-Thomas, Inc., 849 F.2d 1568, 1573 (5th Cir.1988).
That the Bank was aware that drums containing hazardous material were on the Berlin Property during its ownership is not in dispute. Also, testimony corroborates that some of the drums of hazardous waste were personally observed to be without tops and in a rusted condition. Water dripped from the ceiling and the floor was cracked. Any liquid accumulating on the floors was swept into the alleys surrounding the Berlin Property by Season-All employees.
We find that plaintiffs and BFG have made a sufficient showing of a release and disposal of hazardous waste at the Berlin Property during the Bank's ownership to escape summary judgment.
D. COMMON LAW CLAIMS OF PLAINTIFFS AND BFG
We reserve judgment on the merits of the common law and state law claims of plaintiffs and BFG. However, to the extent those theories of liability "derive from a common nucleus of operative fact" and "would ordinarily be expected to [be tried] ... in one judicial proceeding," we retain pendant jurisdiction to hear those claims. United Mine Workers v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 1138, 16 L.Ed.2d 218 (1966).
An order follows.
ORDER
AND NOW, Sept. 1, 1989, the orders of September 24, 1978 and October 26, 1987, are vacated. Defendant BFG Electroplating and Manufacturing may proceed with its cause of action against third-party defendant, National Bank of the Commonwealth, under CERCLA as a former "owner or operator" for the period the Bank had record title to the Berlin Property.
Plaintiffs may proceed with their Rule 14 claim against the Bank under CERCLA as a former "owner or operator" for the period the Bank had record title to the Berlin Property.
We reserve judgment on the merits of the common law and state law claims.
The motion for summary judgment by the National Bank of the Commonwealth is denied.
*565 MEMORANDUM AND ORDER
Reference is made to our opinion of September 1, 1989, wherein the National Bank of the Commonwealth's motion for summary judgment was denied.
We now consider the National Bank of the Commonwealth's motion for reconsideration.
The facts of this case are set forth in detail in our September opinion. Briefly, the Bank, as a mortgagee and eight-month record owner of the Berlin Property, raised the security interest exemption of CERCLA, 42 U.S.C. § 9601(2)(A), to preclude it from potential CERCLA liability under 42 U.S.C. § 9607(a). We held that the security interest exemption did not apply to the period the Bank had record title to the Berlin Property in this case. During that period the Bank was a potentially responsible party as defined in 42 U.S.C. § 9607(a)(2).
Under 42 U.S.C. § 9607(a)(2), a former owner is liable only if hazardous wastes were disposed of during the tenure of ownership. We found that plaintiffs and BFG had raised questions of fact concerning a release and disposal of hazardous waste at the Berlin Property during the Bank's ownership sufficient to preclude summary judgment. Of course, it is a claimant's burden of proof to demonstrate a release and disposal at trial.
We have reviewed the briefs filed by the Bank, plaintiffs and BFG. No new matter has been raised. Accordingly, the motion for reconsideration is denied.
NOTES
[1] See generally, Tom, Interpreting the Meaning of Lender Management Participation Under Section 101(20)(A) of CERCLA, 98 Yale L.J. 925 (1989); Note, The Liability of Financial Institutions for Hazardous Waste Cleanup Costs Under CERCLA, 139 Wis.L.Rev. 139 (1988); Note, When a Security Becomes a Liability: Claims Against Lenders in Hazardous Waste Cleanup, 38 Hastings L.J. 1261 (1987).
[2] A "release" includes "any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing into the environment." 42 U.S.C. § 9601(22) (emphasis added).
"Disposal" is defined to include "a discharge, deposit, injection, dumping, spilling, leaking, or placing of any ... hazardous waste into or on any land or water so that such ... hazardous waste ... may enter the environment or be emitted into the air or discharged in any waters, including ground water." 42 U.S.C. § 6903(3) (emphasis added). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4222014/ | NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
CEQUENT PERFORMANCE PRODUCTS, INC.,
Appellant
v.
HOPKINS MANUFACTURING CORPORATION,
THE COAST DISTRIBUTION SYSTEM INC.,
Appellees
______________________
2016-2701
______________________
Appeal from the United States Patent and Trademark
Office, Patent Trial and Appeal Board in No. IPR2015-
00609.
______________________
JUDGMENT
______________________
DAVID BOGDAN CUPAR, McDonald Hopkins LLC,
Cleveland, OH, argued for appellant. Also represented by
MATTHEW JOHN CAVANAGH.
SCOTT R. BROWN, Hovey Williams LLP, Overland
Park, KS, argued for appellees. Also represented by
MATTHEW B. WALTERS.
______________________
THIS CAUSE having been heard and considered, it is
ORDERED and ADJUDGED:
PER CURIAM (NEWMAN, O’MALLEY, and WALLACH,
Circuit Judges).
AFFIRMED. See Fed. Cir. R. 36.
ENTERED BY ORDER OF THE COURT
November 20, 2017 /s/ Peter R. Marksteinter
Date Peter R. Marksteiner
Clerk of Court | 01-03-2023 | 11-20-2017 |
https://www.courtlistener.com/api/rest/v3/opinions/1329537/ | 107 S.E.2d 792 (1959)
GUARANTY TRUST COMPANY OF NEW YORK
v.
WEST VIRGINIA TURNPIKE COMMISSION.
No. CC844.
Supreme Court of Appeals of West Virginia.
Submitted January 21, 1959.
Decided March 24, 1959.
*794 Jackson, Kelly, Holt & O'Farrell, Robert G. Kelly, Homer A. Holt, Charleston, Davis, Polk, Wardwell, Sunderland & Kiendl, William D. Tucker, Jr., E. Deane Leonard, New York City, for plaintiff.
Wm. T. Lively, Jr., Charleston, for defendant.
CALHOUN, Judge.
This is a declaratory judgment proceeding instituted in the Circuit Court of Kanawha County by Guaranty Trust Company of New York, a corporation, against the West Virginia Turnpike Commission.
The controversy between the parties involves the question whether or not the coupons originally attached to bonds issued by the West Virginia Turnpike Commission bear interest from their respective due dates. The issue was raised by the defendant's demurrer to the petition filed by and upon behalf of the Guaranty Trust Company of New York. The lower court overruled the demurrer and held that the coupons, if not paid when due, bear interest at the rates specified in the bonds from the respective due dates thereof until paid. Thereupon, the circuit court, upon its own motion, certified to this Court its rulings upon the demurrer, in accordance with the provisions of Code, 58-5-2.
The case of Guaranty Trust Co. v. West Virginia Turnpike Commission, D.C., 109 F. Supp. 286, was a declaratory judgment proceeding involving the authority and duties of the West Virginia Turnpike Commission. In the case of Hope Natural Gas Company v. West Virginia Turnpike Commission, W.Va., 105 S.E.2d 630, this Court held that the West Virginia Turnpike Commission is not such an agency of the State as to be immune from suit under Section 35, Article VI of the Constitution of West Virginia. These two cases are referred to, not only in relation to the principles of law therein adjudicated, but also because of the portrayal therein of the legal nature of the respective parties to the instant proceeding and their rights, duties and responsibilities.
Guaranty Trust Company (which is sometimes referred to herein as "Guaranty Trust" or "the Trustee") is a New York Corporation, having full powers as a trust company.
The West Virginia Turnpike Commission (herein sometimes referred to as the "Turnpike Commission" or "the Commission") is an agency of the State of West Virginia, created and established by Chapter 139 of the Acts of the Legislature of West Virginia, Regular Session, 1947, (which is sometimes referred to herein as the "Act" or the "Enabling Act").
By Section 5 of the Enabling Act the Commission is authorized and empowered "To construct, maintain, repair and operate turnpike projects", as defined by such Act, "at such locations within the state as may be determined by the commission;" to fix and collect tolls for the use by the public of turnpike projects; and to issue turnpike *795 revenue bonds, payable solely from turnpike revenues, for the purpose of defraying the cost of turnpike projects.
By Section 10 of the Act the Commission is authorized to secure the payment of such bonds by the execution of a trust agreement with a corporate trustee, having powers of a trust company, whether within or without the State, and to pledge or assign to such trustee the tolls and other revenues received from time to time by the Commission in order to secure the payment of such bonds. By virtue of this provision the Commission entered into an appropriate written agreement with Guaranty Trust.
On March 10, 1952, a resolution was adopted by the Commission authorizing the issuance of turnpike revenue bonds of the State of West Virginia in the principal amount of $96,000,000, bearing interest at 3¾%. On March 3, 1954, the Commission authorized the issuance of additional turnpike revenue bonds in the amount of $37,000,000, bearing interest at 41/8%. Bonds of both issues were sold and delivered to underwriters for distribution to the public. All such bonds bear interest, payable semi-annually on June 1 and December 1 of each year, such interest installments being in the form of the "bond coupons" which form the subject of the controversy in this case. Such bonds are now widely held by owners in forty-seven of the forty-nine states and in several foreign countries.
The revenues of the Commission from the operation of the turnpike project have consistently fallen appreciably below the estimates which were made by the traffic engineers prior to the financing and construction of the turnpike project. On October 1, 1958, the Commission made payment to Guaranty Trust of an amount sufficient (when combined with moneys then in the hands of the trustee) to pay the interest installments which had previously fallen due on June 1, 1958. Moneys presently in the hands of the Trustee, coupled with anticipated revenue, will not be sufficient until approximately September 1, 1959, to enable the trustee to pay the interest installments which became due December 1, 1958.
Except for interest rates, all the bonds, of both issues, are the same and all are secured by the same trust agreement. All the bonds issued are "coupon bonds", with provision for registration, at the election of the several owners thereof.
The trustee asserts that interest, at the bond rates, is payable on the overdue interest installments or coupons. The Commission denies that the overdue interest installments bear interest. The Commission in this connection asserts that it is such an agency of the State as to be entitled to the immunity from payment of interest which is, with some exceptions, enjoyed by a state.
Certain propositions, which are deemed helpful in this connection, are settled by the decision of this Court in the case of Hamilton v. Wheeling Public Service Co., 88 W.Va. 573, 107 S.E. 401. Points 3, 4, and 5 of the syllabus of the Hamilton case are as follows:
"The general rule is that negotiable interest coupons, attached to or detached from bonds, bear interest from and after their respective maturity dates.
"When the interest evidenced by such a coupon has become due and payable, the demand based upon the promise contained therein is no longer a mere incident of the principal indebtedness represented by the bond, but itself becomes a principal obligation.
"But the obligor may defeat recovery of the interest so compounded by showing his continued readiness and willingness to pay the sums specified in the coupons from the date of their maturity."
Apparently recognizing the quotation immediately above as embodying sound legal principles in this jurisdiction, the *796 Commission seeks to avoid their applicability by a reliance upon a principle of law determined in the case of United States v. North Carolina, 136 U.S. 211, 10 S. Ct. 920, 34 L. Ed. 336, and other authorities to like effect. That case involved bonds payable from the state treasury of the State of North Carolina. In other words, unlike the instant case in that respect, the bonds represented direct obligations of the state itself. It was therein held that a state is not liable for payment of interest on its debts, unless its consent to do so has been manifested by an act of its legislature, or by a lawful contract of its executive officers.
Apparently counsel for both parties agree that the foregoing represents the correct rule relating to the immunity of a state from payment of interest. Counsel for Guaranty Trust assert that, nevertheless, the rule of governmental immunity is not applicable to the instant situation and in that connection rely upon the following propositions: (1) The Enabling Act provides for payment of interest on overdue interest coupons and has authorized the Commission to contract to pay such interest; and (2) the Turnpike Commission does not partake of the attributes of sovereignty in such manner and to such a degree that it may enjoy immunity from liability for interest.
Both the Enabling Act and the trust agreement clearly provide for interest at least to some degree, because the coupons themselves represent installments of interest. At most, therefore, the Commission asserts only a qualified immunity from liability for interest. Also, Section 18 of the Act authorizes the Commission to provide by resolution for the issuance of turnpike revenue refunding bonds "for the purpose of refunding any bonds then outstanding which shall have been issued under the provisions of this Act, including * * * any interest accrued or to accrue to the date of redemption of such bonds, * * *." (Italics supplied.) To this extent the Commission is specifically authorized to provide for payment of interest on accumulated interest.
The Act necessarily clothes the Commission with some discretion in order to effectuate its overall purposes. Guaranty Trust Co. v. West Virginia Turnpike Commission, supra. Section 20 of the Act provides: "This act, being necessary for the welfare of the state and its inhabitants, shall be liberally construed to effect the purposes thereof."
The Act charges the Commission with the task of financing the construction of the proposed turnpike project by the issuance and sale of turnpike revenue bonds. There was necessarily implied therein a duty to make the bonds attractive and salable on a competitive market. Such bonds, it must have been recognized, could not be made competitive and salable to a high degree if they were to be stripped of the normal attributes of bonds of this general nature.
Public revenue bonds are uniformly held to be contracts. They are measured by the standard of the laws in effect at the time they are issued. 43 Am. Jur., Public Securities and Obligations, Section 9, pp. 277-78. When the bonds in question were authorized to be placed upon the market, both the Legislature and the Commission were charged with knowledge of the then existing law of this State applying thereto. Each bond coupon is "a principal obligation". Hamilton v. Wheeling Public Service Co., 88 W.Va. 573, 107 S.E. 401, 21 A.L.R. 433. "A past due debt, certain in amount, bears interest from the due date until paid." Morton v. Godfrey L. Cabot, 134 W.Va. 55, syl. 1, 63 S.E.2d 861, 862. By Section 9 of the Act all such bonds are "declared to have all the qualities and incidents of negotiable instruments under the negotiable instruments law of the state." Section 9 of the Act provides: "The commission shall determine the form of the bonds, including any interest coupons *797 to be attached thereto, * * *." The Act throughout, to a considerable degree, clothes the Commission with a latitude in the performance of its responsibility of placing upon the market bonds having such a nature of attractiveness to purchasers that the best interests of the public would be subserved thereby.
The written trust agreement entered into by and between the Commission and Guaranty Trust is quite lengthy. Each party urges certain portions thereof in support of its own contention relative to the question of whether or not the coupons are intended thereby to bear interest from their respective due dates. The portion of the agreement which in the judgment of this Court is most indicative of the intent of the parties is found in Section 802 and Section 803 of the trust agreement. Section 803 provides that "Upon the happening * * * of any event of default", as defined in the trust agreement, the trustee may proceed to enforce the rights of the bondholders. Section 802 provides:
"Each of the following events is hereby declared an `event of default', that is to say: If
"* * * * * *
"(b) payment of any installment of interest shall not be made within thirty (30) days after the same shall become due and payable; * * *."
Section 803 provides further, in part:
"In the enforcement of any remedy under this Agreement the Trustee shall be entitled to sue for, enforce payment of and receive any and all amounts then or during any default becoming, and at any time remaining, due from the Commission for principal, premium, interest or otherwise under any of the provisions of this Agreement or of the bonds and unpaid, with interest on overdue payments at the rate or rates of interest specified in such bonds, * * *." (Italics supplied.)
This, in our judgment, constitutes an express stipulation for payment of interest on overdue interest installments, "at the rate or rates specified in such bonds."
The Turnpike Commission was created and authorized to incur a bond indebtedness for the very reason that the State itself is prohibited by Article X, Section 4 of the State Constitution from incurring such indebtedness. Bond indebtedness incurred by similar agencies of the State has been held by this Court not to obligate the State for its payment. Otherwise such bond indebtedness would be unconstitutional. Bates v. State Bridge Commission, 109 W.Va. 186, 153 S.E. 305; State ex rel. State Road Commission v. O'Brien, 140 W.Va. 114, 82 S.E.2d 903; State ex rel. Board of Governors of West Virginia University v. O'Brien, W.Va., 94 S.E.2d 446; 59 W.Va. Law Rev. 206.
Section 2 of the Act provides that the turnpike revenue bonds "shall not be deemed to constitute a debt of the state or of any political subdivision thereof or a pledge of the faith and credit of the state or of any such political subdivision, * *." The Act throughout makes it abundantly evident that the State shall not be liable for the payment of any portion of the turnpike revenue bonds nor the interest thereon, and that the bonds shall be payable solely from the revenues of the Commission. In the nature of things, therefore, the State's non-liability being clear beyond peradventure, there is a certain incongruity in the contention that the Commission should nevertheless enjoy the State's normal immunity from liability for payment of interest. The State's non-liability for the indebtedness being clear, the basic reason for the rule of immunity is lacking.
A prospective purchaser of any of the turnpike revenue bonds entertaining any misgivings relative to their import and legal effect could look to the Act and readily determine that the State shall not be liable for their payment. Charged with knowledge of the State's non-liability and *798 that bonds, if paid, must be paid solely from the revenues of the Commission, such a prospective purchaser would naturally conclude that, in any event, such bonds would not be curtailed in their legal nature by any sort of State immunity. The bonds being contracts, having all the characteristics of negotiable instruments under the laws of this State, there arises an obligation of good faith to all who have purchased them.
This Court has held that the Commission does not enjoy the State's constitutional immunity from suit. Hope Natural Gas Company v. West Virginia Turnpike Commission, W.Va., 105 S.E.2d 630. Though not controlling, that decision, for the reasons therein assigned, is persuasive of the proposition that the Commission is not entitled to enjoy the State's immunity from liability for payment of interest.
In 43 Am.Jur., 524-25, Public Securities and Obligations, Section 310, it is stated: "The general rule that interest coupons attached to bonds bear interest after maturity even though there is no provision in such coupons for interest has consistently been applied in a great majority of both jurisdictions and cases to coupons attached to public securities and obligations issued by various political bodies. The theory of the cases is that since such coupons have all the qualities of commercial paper, they should bear interest just as does overdue negotiable paper. * * *." (Italics supplied.) For additional authorities which are deemed precedents for the Commission's lack of immunity from liability for interest on the coupons of bonds issued by it, see Board of Com'rs of Ouray County v. Geer, 8 Cir., 108 F. 478; Roswell Drainage District v. Parker, 10 Cir., 53 F.2d 793; Rusciano & Son Corp. v. State, 201 Misc. 690, 110 N.Y.S.2d 770; C. & R. Construction Co. v. Commonwealth, 334 Mass. 232, 135 N.E.2d 539; State Highway Commission v. Wunderlich, 194 Miss. 119, 11 So. 2d 437; National Home for Disabled Volunteer Soldiers v. Parrish, 229 U.S. 494, 33 S. Ct. 944, 57 L. Ed. 1296; State ex rel. Pacific Bridge Co. v. Washington Toll Bridge Authority, 8 Wash.2d 337, 112 P.2d 135; Miller v. Robertson, 266 U.S. 243, 45 S. Ct. 73, 69 L. Ed. 265; Broward County Port Authority v. Arundel Corporation, 5 Cir., 206 F.2d 220; Federal Crop Insurance Corporation v. De Cell, 222 Miss. 643, 76 So. 2d 826; Wilson v. Neal (County Commissioners) C.C., 23 F. 129.
Upon the questions certified, therefore, this Court holds that it is the right, duty and obligation of Guaranty Trust, as trustee, to pay, or to cause to be paid (but only from moneys held by it as such trustee and available therefor) interest at the bond rates upon overdue installments of interest, whether the interest coupons are attached to or detached from the bonds to which they were originally attached, from the respective due dates thereof until the respective dates fixed by Guaranty Trust for the payment thereof, whether or not presentment of any such overdue coupon or demand for payment of any such overdue installment be made. It is the right, duty and obligation of Guaranty Trust, as trustee, to pay such overdue installments in the order in which such installments become due, as provided in Section 804 of the trust agreement; and to determine the date for payment of each overdue installment of interest according to the availability of sufficient moneys in its hands as Trustee. It is evident from the provisions of Section 802 of the trust agreement that the failure to pay the interest installments due on June 1, 1958, or within thirty days thereafter, constitutes an "event of default" under the terms of the trust agreement.
The judgment of the Circuit Court of Kanawha County in overruling the demurrer of the West Virginia Turnpike Commission to the petition of Guaranty Trust Company of New York is affirmed.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2985248/ | Abatement Order filed December 17, 2013.
In The
Fourteenth Court of Appeals
____________
NO. 14-13-00803-CR
____________
VINCENT COLBY DUFFEY, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 268th District Court
Fort Bend County, Texas
Trial Court Cause No. 12-DCR-059653
ABATEMENT ORDER
Appellant is not represented by counsel. On November 21, 2013, the trial
court permitted appellant’s appointed counsel to withdraw. The trial court found
appellant indigent, but did not appoint counsel on appeal. Also on November 21,
2013, time to file appellant’s brief expired without a brief and no motion for
extension of time was filed. See Tex. R. App. P. 38.6(a). The court is unable to
notify counsel that no brief has been received because no counsel has been
appointed. Therefore, we issue the following order:
Pursuant to Tex. R. App. P. 38.8(b) (a copy of which is attached) the judge
of the 268th District Court shall (1) immediately conduct a hearing, at which
appellant and state’s counsel shall participate, either in person or by video
teleconference, to determine (a) whether appellant desires to prosecute his appeal;
(b) if appellant desires to continue the appeal, a date certain when appellant’s brief
will be filed; and (2) prepare a record, in the form of a reporter’s record, of the
hearing. If appellant is indigent, the judge shall take such measures as may be
necessary to assure effective representation of counsel, which may include the
appointment of new counsel. The judge shall see that a record of the hearing is
made, shall make findings of fact and conclusions of law, and shall order the trial
clerk to forward a transcribed record of the hearing, a videotape or compact disc, if
any, containing a recording of the video teleconference, and a supplemental clerk’s
record containing the findings and conclusions. Those records shall be filed with
the clerk of this court on or before January 17, 2014.
The appeal is abated, treated as a closed case, and removed from this Court’s
active docket. The appeal will be reinstated on this Court’s active docket when the
trial court’s findings and recommendations are filed in this Court. The Court will
also consider an appropriate motion to reinstate the appeal filed by either party, or
the Court may reinstate the appeal on its own motion. It is the responsibility of any
party seeking reinstatement to request a hearing date from the trial court and to
schedule a hearing in compliance with this Court’s order. If the parties do not
request a hearing, the court coordinator of the trial court shall set a hearing date
and notify the parties of such date.
PER CURIAM
RULE 38. REQUISITES OF BRIEFS
Tex. R. App. P. 38.8. Failure of Appellant to File Brief.
(b) Criminal Cases.
(1) Effect. An appellant=s failure to timely file a brief does not
authorize either dismissal of the appeal or, except as provided in (4), consideration
of the appeal without briefs.
(2) Notice. If the appellant=s brief is not timely filed, the appellate
clerk must notify counsel for the parties and the trial court of that fact. If the
appellate court does not receive a satisfactory response within ten days, the court
must order the trial court to immediately conduct a hearing to determine whether
the appellant desires to prosecute his appeal, whether the appellant is indigent, or,
if not indigent, whether retained counsel has abandoned the appeal, and to make
appropriate findings and recommendations.
(3) Hearing. In accordance with (2), the trial court must conduct any
necessary hearings, make appropriate findings and recommendations, and have a
record of the proceedings prepared, which recordCincluding any order and
findingsCmust be sent to the appellate court.
(4) Appellate Court Action. Based on the trial court=s record, the
appellate court may act appropriately to ensure that the appellant=s rights are
protected, including initiating contempt proceedings against appellant=s counsel. If
the trial court has found that the appellant no longer desires to prosecute the
appeal, or that the appellant is not indigent but has not made the necessary
arrangements for filing a brief, the appellate court may consider the appeal without
briefs, as justice may require. | 01-03-2023 | 09-23-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1370048/ | 530 F. Supp. 1136 (1982)
WOMEN'S MEDICAL CENTER OF PROVIDENCE, INC.
v.
Dennis J. ROBERTS, II, et al.
PLANNED PARENTHOOD OF RHODE ISLAND
v.
Dennis J. ROBERTS II, et al.
Civ. A. Nos. 80-292, 80-334.
United States District Court, D. Rhode Island.
January 15, 1982.
*1137 *1138 Lynette Labinger, of Abedon, Michaelson, Stanzler, Biener, Skolnik & Lipsey, Deming E. Sherman, of Edwards & Angell, Providence, R.I., for plaintiff.
Joseph R. Palumbo, Jr., of Moore, Virgadamo & Lynch, Ltd., Newport, R.I., Mary Ellen McCabe, Chief Counsel, R.I. Department of Health, Providence, R.I., for defendants.
OPINION
PETTINE, Chief Judge.
This is a consolidated action for declaratory and injunctive relief pursuant to 42 U.S.C. § 1983 challenging the constitutional validity of Rhode Island General Laws Title 23, Chapter 4.7 entitled "Informed Consent for Abortion."[1] Plaintiffs allege violations *1139 of rights secured by the First, Fourth, Ninth and Fourteenth Amendments to the United States Constitution. This Court's jurisdiction stems from 28 U.S.C. §§ 1331(a), 1343(3), 2201, and 2203.
The plaintiffs are Women's Medical Center of Providence, Inc., (WMC), a medical clinic which provides gynecological services, including abortions during the first trimester, Planned Parenthood of Rhode Island (PPRI), a non-profit organization which also provides gynecological services, including abortions during the first trimester, and a class of physicians who perform abortions at clinics, in their offices, and in hospitals in Rhode Island.
Standing
In a preliminary ruling on April 21, 1981, I held that all of the plaintiffs have standing to challenge the Act in question. Women's Medical Center of Providence, Inc. v. Roberts, 512 F. Supp. 316, 320-21 (D.R.I. 1981). I have also ruled that all plaintiffs may assert not only their own rights but also the constitutional rights of their patients women who seek legal abortions in challenging the Rhode Island enactment. Id. at 321-25. The hearing on the merits has not caused me to change my previous opinion and I see no need to reiterate what I said when I first denied defendants' motions to dismiss for lack of standing. Accordingly, I incorporate the reasoning of the prior opinion into this one and hold that plaintiffs have standing to challenge the Act.
The Rhode Island enactment in question governs the manner and time frame within which informed consent for an abortion must be given in Rhode Island.[2] The various sections of the Act may be summarized as follows. The statute requires that a physician convey certain information to the patient. This information includes verification that the woman is pregnant and that a copy of her pregnancy test is available to her; a description of the nature of an abortion, including the probable gestational age of the fetus; an explanation of the procedure involved and of "all medical risks" associated with that procedure; an explanation of "all medical risks" to both the mother and the fetus associated with carrying the fetus to term; and a statement that information concerning abortions printed by the State Department of Health is available to the patient.
I. Factual Background
Women's Medical Center, Inc. provides complete reproductive health care for women. *1140 As its primary activity, the clinic provides first trimester abortions using the dilatation and suction-curettage method.[3] The cost for such abortions is at most $175.00 and may be less, depending on the circumstances of the patient. The clinic employs a rotating staff of four part-time physicians. The clinic also utilizes a full-time support staff including an administrator, a counsellor, nurses, medical assistants and technicians. About 50 abortions are performed every week on Tuesdays, Fridays, and Saturdays. Based on their rotating schedules, each physician spends about five days per month, one to two days per week, at the clinic. The remainder of the physicians' time is spent in private practice or fulfilling other professional commitments.
In general, a woman desiring a first trimester abortion first contacts Women's Medical Center by phone. At this point, the receptionist questions the caller to determine whether the woman has had time to think about her decision and to find out when the woman's last normal menstrual period (LMP) began.[4] Having elicited this information, the receptionist gives the caller an overall perspective on the functioning of the clinic. In short, the receptionist informs the patient of what to expect when she arrives at the clinic and of the procedure followed by the clinic. All other questions are deferred to the time of an appointment which is made if the caller states that she still desires to go through with her decision. The appointment generally is not scheduled for the same day on which the call was received but is scheduled as soon as possible after the call is received. If seven and one-half weeks have not elapsed since the patient's LMP, the appointment is made for the first available abortion day after seven and one-half weeks have passed.
When a woman arrives at the clinic on the appointed day, she first fills out a portion of a medical chart, providing various personal information and a medical history. Upon her completion of this chart, the patient's vital signs are taken and her chart is reviewed for completeness. At this point the clinic also conducts a lab test to confirm the patient's pregnancy. This lab test includes blood typing and venereal disease tests.
Following the lab tests and confirmation of pregnancy, the patient participates in a group counselling session with four or five other women, which is led by the clinic's counsellor. The counsellor goes through the entire abortion process from the time the patient enters the clinic to the time of their follow-up visit about two weeks after completion of the abortion procedure. The counsellor also explains exactly what the doctor will do and how the dilatation and curettage (D&C) method of pregnancy termination works. Included in the discussion is an examination of the risks associated with the surgical procedure. The patients are free to ask questions about anything or share their fears and concerns with the other women in the group. If a patient asks a question that the counsellor cannot answer, one of the doctors is consulted, and an answer is always given before an abortion is performed. The group session lasts from forty-five minutes to one hour.
*1141 Once the group counselling session is completed, each woman meets individually with the clinic counsellor or administrator during which the woman may raise any concerns that she did not feel comfortable raising in a group setting. If the woman expresses a desire to go through with the procedure, a consent form is discussed and signed in the presence of either the counsellor or the administrator. If the patient expresses ambivalence or wants more time to consider her decision, she is free to depart at any time. In fact, the clinic staff will not allow a woman to proceed until she has satisfied them that she knows exactly what she is doing and has consented fully. One physician testified that he has refused to perform abortions even after a woman has reached the operating table because he has perceived indecision.
When the consent form has been signed, the patient proceeds to the procedure room where, usually for the first time, she will meet the physician who will perform the abortion. In general, the physician conducts a pelvic examination, describes what he or she will be doing, and asks the woman if she has any questions or concerns regarding the abortion. If so, the physician will discuss them in whatever detail he or she deems necessary. The actual abortion procedure takes roughly five to seven minutes to complete. When the physician is finished, the patient is accompanied to the recovery room where she stays for about another forty-five minutes. During this time, she is instructed about post-procedure care and birth control. Finally, the patient schedules a two-week check-up before she leaves the clinic.
The Planned Parenthood process is similar to that used by Women's Medical Center. Its one big difference is that it requires two visits to the clinic; a pre-abortion clinic visit and the abortion visit. For the purposes of this opinion there is no need to detail them. Suffice it to say that they include examination, counselling by non-doctors, explanation by one not necessarily a doctor of the procedures, possible complications, financial arrangements, and affirmation of consent to have the abortion, and follow-up examination and counselling. There is no contest in this case as to the adequacy of the methodology used by the clinics or the competency of their doctors.
A woman might also choose to have an abortion performed by a doctor in private practice. Such doctors follow a more or less typical procedure. A woman usually phones her doctor and schedules an appointment. The woman then is instructed to appear at the office on a given date with a urine specimen. Upon arrival, she completes the necessary paper work, if she has not done so before, and is then interviewed by an administrator/nurse. During this interview, the nurse goes over the consent form and discusses the risks of the abortion procedure. The woman may ask questions and express concerns during this session. Following the interview, the administrator/nurse witnesses the patient sign the consent form. The patient then meets the physician, who performs a complete physical examination. After this, the doctor follows up with a meeting in his office during which he discusses any questions the patient has and recommends birth control measures for the future. The doctor then typically schedules an appointment for the abortion. Because the abortion must be performed in a hospital, however, the patient may have to wait seven to ten days before the pregnancy can be terminated. Of course, if an emergency situation exists an accelerated date may be available. The termination procedure in the hospital approximates the procedure usually performed in the clinics discussed above. The costs for a first trimester D&C procedure by a doctor in private practice would be approximately $145.00 for the hospital costs and $150.00 for the physician, making the total cost approximately $300.00.
WMC introduced evidence that the present Rhode Island statute, if enforced, will cause patients to go to Massachusetts for abortions rather than make two trips 24 hours apart to the Rhode Island clinic. On the other hand, the state argues that women who seek abortions from PPRI must visit the clinic at least two separate times *1142 and that this fact proves the burden imposed by the State's mandatory twenty-four hour waiting period is reasonable and certainly not burdensome. However, the administrator of PPRI testified that the clinic will soon initiate a same-day service similar to the one offered by WMC.
Other evidence introduced by WMC and not substantially impeached by the defendants was that "the cost to the patient would be increased because there would be a necessity for more staff, the clinic would have to remain open longer and the cost of the physician would increase due to the requirement of two visits to the physician.... [T]he doctor would have to be at the clinic for two sessions (rather than one) for each patient. [As it now stands paraprofessionals on the staff convey the informed consent and other basic information to patients]." All this means increased cost to the patient and, since the present staff of doctors at the clinic is on a part-time basis in conjunction with their private practice, the two-day visit will present problems finding doctors willing to devote the extra time.
The plaintiffs also produced evidence showing that there are 25-30 physicians in Rhode Island who perform abortions, but only 5-6 of them will perform such a procedure between 13 and 14 weeks. Consequently, a patient who passes into the second trimester may have to wait an additional month and, because she is in the second trimester, go to a hospital. This, of course, makes such an abortion more expensive than one in the first trimester.
The testimony at trial also indicated that first trimester abortions are less risky than those in second trimester. Furthermore, if performed before the 10th week of pregnancy, abortions are safer for a woman than carrying a child to term.
Commenting on the statute at issue, Dr. DiOrio of WMC stated the 24-hour waiting period interferes with the patient's well-being. Ninety-five percent of all the patients he sees have searched their souls before making the decision to terminate their pregnancy. He also pointed out that it is unnecessary to disclose all medical risks because it cannot be done "without reading off a textbook of potential complications, no matter what the procedure would be, and then supplementing that with recent journal articles where newer complications that are now not yet in textbooks have been found to occur." He further testified that it is equally unnecessary to tell patients all medical risks associated with carrying a fetus to term, and that there is, in his medical opinion, no reason for requiring a broader explanation for abortion than for other surgical procedures. Finally he said that the statute's required explanation of "psychological risks to the fetus" has no meaning to him as a physician, and that he would not know how to comply with this requirement. Equally needless, he felt, is the requirement that the physician who performs the procedure be the same physician who makes the required disclosures. Other medical evidence established that the utilization of paraprofessionals is a necessary and desirable trend in medicine and a distinct benefit to patients, and is consistent with good medical practice when properly executed.
The plaintiffs also established, through medical testimony, that it is not necessary, in order to obtain an informed consent, that the patient be told of the anatomical and physiological characteristics of the fetus and its chances of survival. The plaintiffs' evidence indicated that the exposure to such information in a few cases may change the patient's mind, but in many other cases will increase unnecessarily the psychological burden of making the decision.
The defendants attempted to refute plaintiffs' case with contrary testimony. This testimony, which the Court ultimately found unpersuasive included the following: a) that the term "consistent with good medical practice" in subsection 5 of the Act is broad enough to relieve a physician of the statutory obligation to disclose information which is medically irrelevant to informed consent; b) that the requirement that the physician who is to perform the procedure must also provide the disclosure is medically necessary and in keeping with good medical *1143 practice; and c) that the 24-hour waiting period is based upon the sound realization that a patient is propelled by the momentum of events to proceed with the abortion without an appropriate cooling off period.
The Legal Standard
Before discussing each requirement of the Rhode Island statute, it is necessary that I establish the applicable legal standard. This standard was first established in Roe v. Wade, 410 U.S. 113, 93 S. Ct. 705, 35 L. Ed. 2d 147 (1973), and Doe v. Bolton, 410 U.S. 179, 93 S. Ct. 739, 35 L. Ed. 2d 201 (1973), and further expounded in Planned Parenthood of Central Missouri v. Danforth, 428 U.S. 52, 96 S. Ct. 2831, 49 L. Ed. 2d 788 (1976), and Harris v. McRae, 448 U.S. 297, 100 S. Ct. 2671, 65 L. Ed. 2d 784 (1980). These cases hold that a woman's right to decide whether or not to terminate her pregnancy is a fundamental right, bound up with the rights of privacy implicit in the "liberty" component of the due process clause of the Fourteenth Amendment. Hence, only compelling state interests can justify any state limitations. Roe v. Wade, supra, 410 U.S. at 155, 93 S.Ct. at 727; Akron Center for Reproductive Health, Inc. v. City of Akron, 479 F. Supp. 1172, 1200 (N.D.Ohio 1979), aff'd in part, rev'd in part, 651 F.2d 1198 (6th Cir. 1981). See Planned Parenthood League of Massachusetts v. Bellotti, 641 F.2d 1006, 1016 (1st Cir. 1981) ("[W]ithout deciding whether the interest asserted has been shown to be compelling, we conclude that the state has failed to establish that the [statutory provision] is `necessary' to serve that interest.") However, certain insignificant or de minimis burdens on the right are permissible and will not trigger strict scrutiny of the relevant enactment. Charles v. Carey, 627 F.2d 772, 777 (7th Cir. 1980).[5]
*1144 Balancing a woman's rights against the state interests, the Supreme Court has divided pregnancy into three trimesters. During the first trimester, no non-de minimis burdens on the abortion decision have been permitted. See Colautti v. Franklin, 439 U.S. 379, 387, 99 S. Ct. 675, 681, 58 L. Ed. 2d 596 ("[U]p to the points where important state interests provide compelling justifications for intervention, `the abortion decision in all its aspects is inherently, and primarily, a medical decision...."). During the first three months, once the decision is made, the state cannot interfere with its effectuation, except to enhance, in a very limited and nonburdensome way, the medical aspects of the patient-physician decision-making process. See Planned Parenthood of Central Missouri v. Danforth, supra, 428 U.S. at 67, 81, 96 S.Ct. at 2840, 2846 (upholding a minimal informed consent requirement that applied to the first trimester and a record-keeping requirement that applied to all abortions regardless of trimester because the Court found "no legally significant impact or consequence on the abortion decision or on the physician-patient relationship"). When a woman reaches the second trimester of pregnancy, the state "in promoting its interest in the health of the mother, may, if it chooses, regulate the abortion procedure in ways reasonably related to maternal health." Roe v. Wade, supra, 410 U.S. at 164, 93 S.Ct. at 732. Finally, the third trimester of pregnancy has been characterized by the Supreme Court, for purposes of constitutional analysis, as "viability." At this point the state "in promoting its interest in the potentiality of human life may, if it chooses, regulate, and even proscribe, abortion except where it is necessary" to preserve the life of the mother. Id. at 164-65, 93 S.Ct. at 732.
Because the Rhode Island statute does not differentiate among trimesters, the appropriate standard of review is that applicable to the first trimester. See, e.g., Women's Services P.C. v. Thone, 483 F. Supp. 1022, 1044 (D.Neb.1979), aff'd per curiam, 636 F.2d 206 (8th Cir. 1980), vacated and remanded, 452 U.S. 911, 101 S. Ct. 3043, 69 L. Ed. 2d 414 (1981). Thus, if the statute creates a substantial, non-de minimis interference with a woman's right to an abortion, Rhode Island must demonstrate a compelling state interest to justify the interference. See note 5 supra.
The outside parameters of what a state may do during the first trimester have been set. For example, in Danforth the Supreme Court upheld the de minimis interference created by minimal informed consent and record keeping, which did not obstruct a meaningful physician-patient consultation and did not seek to influence the outcome of the woman's final decision. (I note, however, that the Court found that even these requirements "approach[ed] impermissible limits." Danforth, supra, 428 U.S. at 81, 96 S.Ct. at 2846.) Furthermore, in Maher v. Roe, supra, 432 U.S. at 473-74, 97 S.Ct. at 2382, and Harris v. McRae, supra, 448 U.S. at 315-16, 100 S.Ct. at 2687-88 the Court declared that states could constitutionally refuse to pay for both non-therapeutic and medically-necessary abortions. The Supreme Court reasoned that these kinds of budgetary decisions simply place no governmental obstacle in the path of a woman who chooses to terminate her pregnancy.
Having analyzed these and other cases establishing the limits of state interference with the abortion decision, I find that most of the Rhode Island statute exceeds these limits. As I read the statute at issue, it clearly imposes legally significant, non-de minimis burdens on the right of a woman, in consultation with her physician, to decide to terminate her pregnancy. Furthermore, the state has not shown a compelling interest to justify its intrusion.
*1145 Void for Vagueness Criminal Nature of the Statute
To begin, we must not lose sight of the criminal nature of the statute, and thus the need for its precision. An intentional, knowing, or reckless violation of this statute by a physician can result in his imprisonment for up to one year. Such a statute must give a person of ordinary intelligence fair notice that his conduct is forbidden by the statute; it must not be so indefinite that it encourages arbitrary and erratic convictions especially where the law threatens to inhibit the exercise of constitutionally protected rights. Colautti v. Franklin, 439 U.S. 379, 390, 99 S. Ct. 675, 683, 58 L. Ed. 2d 596 (1979).
The law before this Court requires that a woman be informed of "all medical risks" associated with the "abortion procedure" and of all "medical risks," both physical and psychological, to herself and to the fetus, associated with the alternative of carrying the fetus to term. I find that these requirements are sufficiently ambiguous to serve the subjective prosecutorial whim of law enforcement and are void for vagueness.
The Court notes first that the statute fails to define "abortion." Without a precise statutory definition, the term "abortion procedure" is overly broad and vague. "Abortion" is not self-defining and may include both doctor-induced and spontaneous fetal loss. See Wynn v. Scott, 449 F. Supp. 1302, 1328-30 (N.D.Ill.1978), aff'd sub nom. Wynn v. Carey, 599 F.2d 193 (7th Cir. 1979) (finding term "miscarriage" impermissibly vague). Furthermore, a physician can be said to "perform" an "abortion" both when he initiates the termination of a pregnancy and when he performs an operation to complete an otherwise incomplete, spontaneous miscarriage. Such ambiguity does not afford persons a reasonable opportunity to conform their conduct to the law and cannot be tolerated. Hynes v. Mayor and Council of Borough of Oradell, 425 U.S. 610, 620, 96 S. Ct. 1755, 1760, 48 L. Ed. 2d 243 (1976). Because this central term does not pass constitutional muster, the entire statute must fall, except for § 23-4.7-4, which merely requires that the Rhode Island Department of Health publish certain information.
The term "all medical risks" also prevents compliance with the law. Dr. Stubblefield, Chief of the Division of Ambulatory and Community Medicine and the Department of Obstetrics and Gynecology at Brigham and Women's Hospital and Assistant Professor of Obstetrics and Gynecology at Harvard Medical School testified that if he were trying to practice medicine under the statute he would be "terrified." Modern medical science is advancing rapidly, and new risks associated with undergoing an abortion are constantly being discovered. Thus, no physician can know with certainty exactly what the term "all medical risks" requires him at any moment to disclose to a patient. Such uncertainty in a criminal statute is impermissible.
Finally, the plaintiffs offered medical testimony that the term "psychological risks to the fetus" associated with the alternative of carrying to term is meaningless. Doctors simply would not know what to say to a patient. I thus find this statutory term also unconstitutionally vague because "it simply has no precise meaning." Wynn v. Scott, supra, at 1313.
The 24-Hour Waiting Period
R.I.G.L. § 23-4.7-1, entitled "Time of Consent," mandates that a woman seeking an abortion give her informed written consent to the termination "at least twenty-four (24) hours prior to the scheduled operation." The majority of federal courts have held such mandatory waiting periods unconstitutional. See, e.g., Akron Center for Reproductive Health, Inc. v. City of Akron, 651 F.2d at 1208; Planned Parenthood League of Massachusetts v. Bellotti, supra, at 1014-16; Charles v. Carey, supra, at 785-86.
Rhode Island's mandatory waiting period constitutes a direct state limitation on a woman's right to have an abortion. Simply put, the state requires that, regardless of a woman's frame of mind, despite her doctor's *1146 contrary medical judgment, regardless of whether she previously had an abortion, and notwithstanding her possible medical sophistication, a woman seeking an abortion must, after giving her informed consent to the procedure, wait at least twenty-four hours before having the operation. It is difficult to argue that such an intrusion by the state does not unconstitutionally burden the abortion decision.
The state, however, contends that the 24-hour requirement does not burden this right because women who seek abortions from PPRI must visit the clinic at least two times. I disagree. Although PPRI now requires two visits, WMC does not. Absent the statutory waiting period, a woman could have her abortion performed in WMC's "same day" facility. The statute therefore deprives a woman of the shorter WMC option, thus burdening her right to an abortion. Furthermore, as noted earlier, PPRI plans to begin same day service similar to that at WMC.
The Court must now evaluate the significance of the burden that the 24-hour waiting period imposes. The evidence of burden in this record is virtually identical to that relied upon by the First Circuit in Bellotti. As in Bellotti, delay increases the risk to the patient. Although a mere twenty-four hour delay by itself may not increase the risk of an abortion to a statistically significant degree, the record in this litigation shows that the mandatory wait may combine with other scheduling factors such as doctor availability, work commitments, or sick leave availability, to increase the actual waiting period to a week or more. And, it is uncontested that delays of a week or more do indeed increase the risk of an abortion to a statistically significant degree. See Center for Disease Control, Abortion Surveillance 48, Table 20 (1980). The evidence to this effect is virtually uncontradicted. Furthermore, a delay of even twenty-four hours may push a woman into the second trimester, thus requiring that the operation be performed in a hospital, and significantly increasing the procedure's cost, inconvenience, and, of course, risk.
In addition to delay, the 24-hour waiting period "imposes substantial ancillary burdens on a woman's right to have an abortion." Planned Parenthood League of Massachusetts v. Bellotti, supra, at 1014. For example, it is uncontested that the waiting period requirement will necessitate two visits to an abortion facility for every woman seeking an abortion. For the woman with a distance to travel or with other commitments, the twenty-four hour wait may make having an abortion inconvenient and burdensome. Furthermore, combined with other provisions of the Rhode Island informed consent scheme, the twenty-four hour wait may aggravate the already difficult problem of finding enough doctors to staff abortion clinics adequately. The Rhode Island statute contains a provision requiring the same doctor who obtains a woman's informed consent to perform the actual abortion. As currently staffed, WMC and PPRI simply cannot schedule their part-time staff of doctors so as to make the same doctor who obtains informed consent available on some day later in the week to perform the actual abortion. Moreover, because obtaining more part-time doctors has proved very difficult for these clinics, the provisions of the Rhode Island statute may force them to schedule fewer abortions. Hence, the combined effect of the "same doctor" and waiting period requirements may be further delay in obtaining an abortion and a concomitant increase in the risk associated with the procedure.
Because the 24-hour period has more than a de minimis effect on a woman's abortion decision, the state must demonstrate a compelling interest to justify this substantial interference. Furthermore, Rhode Island must show that the waiting period is necessary, that is, narrowly tailored to serve its interest. The state argues that the 24-hour period promotes the state's interest in ensuring that a woman make a truly "informed" abortion decision. Rhode Island argues that the waiting period provides a time within which a woman can reflect cooly on the medical risks that the physician must disclose to her during their first meeting.
*1147 Whether the state's interest in providing a period of reflection is compelling or not, a question that I need not decide, the waiting period requirement must fall because it is not necessary to serve that interest. Planned Parenthood League of Massachusetts v. Bellotti, supra, at 1016. The testimony of Doctors D'Orio and Stubblefield establishes both that most women undergo intense "soul searching" prior to requesting an abortion, and that approximately 95% of them have made up their minds before seeing a physician. Stubblefield testified that there is "nothing that we [doctors] can do to change [their minds]." Thus, as the First Circuit found in Bellotti, the mandatory waiting period may not lead to further reflection, id. at 1016, and "in light of the extensive consideration that most women have given the abortion decision in advance, ... truly informed consent [cannot be said to be] impossible or even unlikely without the mandatory delay." Id. In short, based on all of the above, I must conclude that the twenty-four hour waiting period in the Rhode Island statute imposes a "legally significant" burden on a woman's fundamental right to choose to terminate her pregnancy, and that the state has not demonstrated that imposition of the twenty-four hour waiting period is necessary to any compelling state interest.
7-Day Expiration of Consent
In addition to requiring a twenty-four hour waiting period, R.I.G.L. § 23-4.7-1 also places a seven-day "cap" on the period during which a woman's consent remains valid. This 7-day cap will require a woman who fails to have her abortion within 7 days of signing the consent form to be instructed a second time about the risks of undergoing the operation. This second explanation may require between 30 and 45 minutes of clinical staff time and may increase the costs of an abortion. The Court need not, however, decide whether such extra time and cost constitutes more than a de minimis burden on the abortion decision, thus triggering the compelling state interest test. The Court is unable to discern even a rational reason for imposing the 7-day cap, for the Court finds it highly improbable that a woman would forget about the medical risks explained to her just seven days earlier. Thus, because the 7-day cap is not even rationally related to a legitimate state interest, it fails to pass constitutional muster.
Same Physician Requirement
The "Required disclosure" section of the Act provides that the doctor who is to perform the abortion must make the necessary disclosures to the patient. This requirement, like the mandatory twenty-four hour waiting period, represents a direct state intrusion into a woman's abortion decision and into the doctor-patient relationship that plays such an important role in the decision. But for this provision, a doctor who performs abortions would retain the flexibility to train and supervise counsellors or nurses to perform the informing function. A doctor could also, if necessary, arrange for a colleague to perform either the informing function or the surgery.
The burdensomeness of this requirement is evident. A woman may well consult in the first instance with her personal physician in reaching her decision. Under this "same doctor" rule, if that physician refers the woman to another doctor for the actual abortion operation, the woman will nevertheless have to undergo the expense and inconvenience of another pregnancy test and informed consent procedure. Charles v. Carey, supra at 784.
This particular enactment operates to deny a doctor such flexibility by requiring, without exception and under penalty of fine or imprisonment, that he or she always provide the information leading to informed consent and always perform the abortion after having personally obtained such consent.
In Planned Parenthood of Central Missouri v. Danforth, the Court expressed concern over informed consent requirements that operated in such a way that physicians would be shackled in the performance of their responsibilities. In upholding Missouri's minimal informed consent provision, the Court warned,
*1148 One might well wonder, offhand, just what "informed consent" of a patient is .... [W]e are content to accept, as the meaning, the giving of information to the patient as to just what would be done and as to its consequences. To ascribe more meaning than this might well confine the attending physician in an undesired and uncomfortable straitjacket in the practice of his profession. 428 U.S. at 67 n.8, 96 S.Ct. at 2840 n.8.
The testimony in this case indicates that the "same physician" requirement will create the kind of "straitjacket" the Supreme Court found undesirable.
A primary component of the cost of an abortion is the cost of the doctor's time. One way to cut some of the costs of surgery is to restrict the use of doctor-time to those services that only the doctor can provide. In this way, a hospital or other medical facility can make the highest and best use of a doctor's time and, concomitantly, reduce the cost of the peripheral services that make up the total package. For example, the WMC and PPRI clinics keep the costs of abortions down by attempting to utilize doctor-time only for the actual surgery. The counselling and informing functions are performed by other professionals whose time is not as expensive as a doctor's. By not "under-employing" doctors, these clinics provide an abortion at its optimal cost. The clinics practice helps alleviate the shortage of doctors available for abortion services discussed above. By utilizing a doctor's time in the most efficient fashion, the clinics free their doctors to do more of the things that only they are capable of doing. The State's "same physician" requirement will disrupt this method of proceeding, thereby increasing the cost of abortions and aggravating the increasing doctor shortage.
In addition, the "same physician" requirement will disrupt the normal practice of medicine that allows doctors to substitute for each other in certain situations. Because it contains no exceptions, the State's requirement will necessitate that, even in emergency situations, an operation be postponed if the same doctor who obtained informed consent cannot perform the operation. Thus, the requirement will also tend, in some cases, to increase the time lag between consent and operation enough that an increase in the risk associated with the procedure will result. For this and the above reasons, I must conclude that Rhode Island's "same physician" requirement imposes a legally significant burden on a woman's fundamental right to terminate her pregnancy.
In justification of the provision, the State contends that good medical practice requires physicians themselves to provide the information leading to informed consent. The State also contends that a patient's ability to reschedule her appointment if the same doctor cannot perform the surgery vitiates any problem created by the fact that the statute provides no exceptions. These arguments certainly do not demonstrate a compelling state interest. They suggest, at best, that the "same physician" requirement is a good idea.
But even the State's contention that good medical practice demands such a requirement is open to serious question on its merits. Much of the testimony at trial indicates that the national trend is toward the use of trained and supervised "paraprofessionals" to deliver the information and counselling that leads to informed consent for any surgical procedure. This trend has developed in response to a national desire to lower the cost of medical care and to offset a national shortage of doctors, and in recognition of the fact that doctors often are not the best people to perform this function. Several doctors who testified in this case indicated that they felt that a trained counsellor could be much more effective in obtaining truly informed consent than could the attending physician. This is particularly true in the area of abortions where counselling skills may be as important to the success of the procedure as is surgical technique. Counsellors may also be better at searching out ambivalence or anxiety than would a physician. Hence, even assuming that the State has a compelling interest in assuring that informed consent conforms to *1149 good medical practice, the State has not demonstrated that the "same physician" requirement serves this end at all. The requirement limits a physician's flexibility in practicing medicine and, thus, burdens a woman's fundamental right to an abortion. Because the State has not met its burden of establishing a compelling interest and showing that the "same physician" provision is necessary to serve that interest, this requirement must be eliminated from the statute.
Required Disclosure
Section 1 requires that a "copy of the [patient's pregnancy] test be made available to her." This appears to require that a laboratory test be performed in every case to determine pregnancy. Accord Charles v. Carey, supra, at 786. Such a requirement is not medically necessary and may cause additional expense to a woman seeking an abortion. Pregnancy can be, and sometimes is, confirmed by methods which are less expensive than blood or urine tests. For example, the testimony revealed that it is perfectly proper and consistent with good medical practice to confirm a woman's pregnancy on the basis of the presence of a fetal heartbeat.
It could be argued that a doctor who confirms pregnancy by using such a method could still comply with the statute by making available a copy of his report to the patient. In this sense it may be argued that the section merely requires information that has probative value to a woman's decision and that the prejudicial effect is minimal. See Planned Parenthood League of Mass. v. Bellotti, supra, at 1016-22. As such, the section would not interfere with the exercise of a woman's fundamental right and, thus, would not violate the due process clause of the Constitution. However, this argument ignores the criminal nature of the statute. Doctors would understandably be reluctant to follow alternative acceptable practices for fear of running afoul of the law. As a result, only laboratory tests would probably be performed, which in turn would result in additional and unnecessary expense to the patient. This is an unwarranted intrusion into the physician-patient relationship and is without medical foundation. I also conclude that, from a reading of this section, a doctor could not "reasonably understand" what is proscribed. It seems to me that it is unconstitutionally vague and violative of due process, and I so find.
The next provision under "Required disclosures," § 23-4.7-2(2), provides that a woman seeking an abortion acknowledge that "the nature of an abortion has been fully explained, including the probable gestational age of the fetus at the time the abortion is to be performed." Regarding the first part of this provision, requiring that the nature of an abortion be fully explained, I interpret this to require an explanation of the medical nature of an abortion. Consistent with the notion that the State may act in unintrusive ways to enhance the quality medically speaking of the decision-making process, this provision requires simply that a woman be informed that an abortion will terminate her pregnancy and that, once completed, the operation cannot be reversed. Nothing on its face indicates that a physician must engage in a philosophical or moral discussion of abortion to satisfy this provision. In fact, physicians are not necessarily qualified to engage in such discussions and the State's interest in assuring informed consent extends only far enough to include the medical aspects of a woman's decision. Interpreted in this way, the provision requires nothing more than what was approved by the Supreme Court in Danforth: "we are content to accept, as the meaning [of informed consent], the giving of information to the patient as to just what would be done...." 428 U.S. at 67 n.8, 96 S.Ct. at 2840 n.8. Fundamental to a meaningful decision on whether to have an abortion is a precise understanding that it will terminate pregnancy, and that the operation is irreversible. This kind of information serves to enhance the quality of the decision-making process and cannot be viewed as anything except a neutral, non-normative requirement that a woman know exactly what it is that she is requesting. Thus, I find the *1150 requirement that women be informed of the "nature of an abortion" to be constitutional.
The requirement that a woman know the "probable gestational age of the fetus at the time the abortion is to be performed" can also be easily upheld. It should be noted that this is not a requirement that the physician discuss the anatomical and physical characteristics of the fetus at the time the abortion is to be performed. See Planned Parenthood League of Mass. v. Bellotti, supra, at 1021; Charles v. Carey, supra, at 784; Leigh v. Olsen, 497 F. Supp. 1340, 1345 (D.N.D.1980). It appears to be undisputed that this information is currently supplied on a routine basis to women seeking abortions by their doctors or by the staff of the facility at which they seek an abortion. In fact, the gestational age of the fetus forms a key ingredient in the medical decision as to when to perform an abortion, when to utilize various surgical techniques, and when the "trimesters" begin and end. The gestational age of the fetus also has a direct relationship to the degree of risk associated with an abortion. See Center for Disease Control, Abortion Surveillance 48, Table 20 (1980). All of these factors indicate that this information comprises a fundamental requisite of truly informed consent.
Like information regarding the medical nature of an abortion, the probative value of information about the gestational age of the fetus when the abortion is to be performed cannot be questioned at least on the record before me. Furthermore, any prejudicial effect resulting from these kinds of informational requirements stems from the essence of informed consent itself. The Supreme Court has held that a State may properly require that a woman be informed of what will be done to her and of its potential consequences. Hence, the State may decree that a woman not be unreasonably ignorant of the nature of her decision. Requiring that a woman be informed of the medical nature of an abortion and of the gestational age of the fetus when the abortion will be performed simply provides the woman with the necessary information on which truly informed consent must be predicated. These requirements do not infringe on a woman's fundamental right to choose to terminate her pregnancy.
Informed Consent
Sections 23-4.7-2(3) and (5) require that a woman seeking an abortion acknowledge being given an explanation of the procedure to be used and of all medical risks, both physical and psychological, associated with the procedure, consistent with good medical practice. The statute also requires that she be informed of all medical risks, both physical and psychological, to herself and the fetus, associated with carrying the fetus to term, consistent with good medical practice.
The controversy centers around the phrase "consistent with good medical practice" as it relates to the mandated disclosure of "all medical risks, both physical and psychological." The defendants contend that this merely means that the doctor must discuss with the patient those risks dictated by good medical practice. However, the plaintiffs argue that the required disclosure is non-restrictive and indicates the legislature has determined that in abortion cases it is consistent with good medical practice to require that all medical risks be discussed. Any attempt to glean the legislative intent from legislative history will be to no avail; the Rhode Island legislature produces no committee reports and keeps no records of floor debates. Regarding the general purpose of these particular provisions, the legislature has provided only one clue in the introductory paragraph of § 23-4.7-2. There, the legislature stated that the "Required disclosure" section was enacted "[i]n order to insure that the consent of the pregnant woman is truly informed consent." This statement of purpose, however, provides almost no help in determining whether plaintiffs or defendants are correct in their views of the requirements because "truly informed consent" is consistent with the interpretations of both sides.
The First Circuit faced a similar ambiguity in the statute challenged in Planned Parenthood *1151 League of Massachusetts v. Bellotti. That statute required a woman seeking an abortion to sign a consent form that disclosed "the possible complications associated with the use of the procedure and with the performance of the abortion itself." Id. at 1020. Plaintiffs objected that this requirement called for the disclosure of all possible complications, however remote or improbable, and that such disclosure was both contrary to good medical judgment and likely to increase the chance of harm to a patient and the risk of irrational decision-making. Id. at 1020 n. 21. The First Circuit had the advantage of having before it the actual consent form which the Massachusetts Department of Public Health proposed to use under the statute. The court treated the proposed form as an authoritative interpretation of the Act, id. at 1008-09, and was convinced by a reading of the form that it did not provide disclosure of all possible complications. Id. at 1020 n.21. The court therefore found this section of the statute constitutionally unobjectionable.
Rhode Island, by contrast, has no similar authoritative construction of its statute. Absent such a construction, and given the fact that this is a criminal statute, I can only conclude that doctors will be forced to disclose all possible complications of both abortion and pregnancy in order to avoid the possibility of criminal liability. I therefore accept plaintiff's interpretation of the statute as representing the better view of what the statute actually requires.
For several reasons, these sections of the statute must be declared unconstitutional. As I have already stated, the United States Supreme Court in Danforth has ruled that, although the state may require informed written consent, it may not impermissibly burden the privacy of the physician-patient relationship or attempt to influence the choice. See also Planned Parenthood League of Massachusetts v. Bellotti, supra, at 1017. The pivotal inquiry is whether the state is unjustifiably interfering. An examination of the statute in light of the relevant precedents convinces me that the state is doing just that.
In Akron Center for Reproductive Health, Inc. v. City of Akron, the Court struck down a requirement that the physician provide each patient seeking an abortion with a detailed list of information specified in the statute. It stated:
The requirements of section 1870.06(B) impose "restrictions or regulations governing the medical judgment of the pregnant woman's attending physician with respect to the termination of her pregnancy." Danforth, 428 U.S. at 80, 96 S.Ct. at 2846. Such restrictions or regulations are not permitted during the first trimester of pregnancy. The district court correctly held section 1870.06(B) invalid, not because it would burden the physician, but because its effect would be to encumber the exercise of the patient's constitutionally protected right "by placing obstacles in the path of the doctor upon whom she was entitled to rely for advice in connection with her decision." Whalen v. Roe, 429 U.S. 589, 604 n.33, 97 S. Ct. 869, 879 n.33, 51 L. Ed. 2d 64 (1977). Id. at 1207.
I feel that the Rhode Island statute is similarly defective. The informed consent requirements have been firmly established in Rhode Island in Wilkinson v. Vessey, 110 R.I. 606, 295 A.2d 676 (1972). And the State has offered no medical justification for a higher standard in abortion cases. Assuming that the Wilkinson standard comports with Danforth, I find that it is the outer limit of tolerable state interference in the physician-patient relationship in the first trimester.
In Wilkinson the Court stated at 295 A.2d 689:
Having established defendants' duty to disclose, we will now delineate the extent of the disclosure which should be made. Obviously there is no need to disclose risks that are likely to be known by the average patient or that are in fact known to the patient usually because of a past experience with the procedure in question. Fleishman v. Richardson-Merrell, Inc., 94 N.J.Super. 90, 226 A.2d 843 (1967); Starnes v. Taylor, 272 N.C. 386, *1152 158 S.E.2d 339 (1968). It is not necessary that a physician tell the patient any and all of the possible risks and dangers of a proposed procedure. Getchell v. Mansfield [260] Or. [174], 489 P.2d 953 (1971). As we noted earlier, materiality is to be the guide. It is our belief that, in due deference to the patient's right to self determination, a physician is bound to disclose all the known material risks peculiar to the proposed procedure. Materiality may be said to be the significance a reasonable person, in what the physician knows or should know is his patient's position, would attach to the disclosed risk or risks in deciding whether to submit or not to submit to surgery or treatment. Waltz and Scheuneman, Informed Consent to Therapy, 64 Nw.U.L.Rev. 628, 640 (1970). Among the factors which point to the dangerousness of a medical technique are the severity of the risk and the likelihood of its occurrence. A very small chance of death or serious disablement may well be significant; a potential disability which dramatically outweighs the potential benefit of therapy or the detriments of the existing malady may require appropriate discussions with the patient. Canterbury v. Spence [464 F.2d 772 (D.C.Cir.1972)], supra. A physician's liability in this area is to be judged on the basis of what he told the patient before treatment began. Liability should be imposed only if the trier of fact finds the physician's communication to be unreasonably inadequate. Canterbury v. Spence, supra. The imposition of a duty of making disclosure is tempered by the recognition that there may be a situation where a disclosure should not be made because it would unduly agitate or undermine an unstable patient. Stauffer v. Karabin, Colo.App. [30 Colo. App. 357], 492 P.2d 862 (1971); DiFilippo v. Preston [3 Storey 539], 53 Del. 539, 173 A.2d 333 (1961); Natanson v. Kline [186 Kan. 393, 350 P.2d 1093], supra.
(footnotes omitted)
This standard mandates less disclosure than is required by the Act. Medical testimony established that there is no justification for a more severe standard in abortion cases, and that requiring disclosure of all medical risks would constitute a substantial interference in the doctor-patient relationship. In short, this record is clear, as plaintiffs contend, "that there is no medical justification for treating abortions differently from other surgical procedures, and that the standard for informed consent for abortions should be the same as for other surgical procedures."
Though what has been said to this point is sufficient to strike down sections 2(3) and 2(5), their invalidity may be established for other reasons as well. The need for consent must, of course, be obviated "by an emergency which places the patient in immediate danger and makes it impractical to secure such consent." Dunham v. Wright, 423 F.2d 940, 941 & n.1 (3rd Cir. 1970). Yet, the Rhode Island statute, though recognizing such need in section 1 as an exception to the mandatory waiting period, totally ignores, in spite of the criminal nature of the statute, the need for a similar exception in the section under discussion. The potential for such medical emergencies are real. Furthermore, uncontradicted medical testimony established that under such circumstances a risk discussion with the patient is contra-indicated or impossible. To say the least, it is rather difficult to understand why this statute imposes criminal penalties for noncompliance in emergency situations. It hardly furthers the State's interest in maternal health and impermissibly intrudes on the physician-patient relationship. It is not narrowly drawn to further any legitimate state interest and, for this reason, sections 2(3) and 2(5) must be declared unconstitutional.
Availability of Printed Materials
R.I.G.L. § 23-4.7-2(4) mandates that a woman seeking an abortion be informed of the availability of certain printed information which must be published by the Rhode Island Department of Health. The physician is required to inform his patient, in substance, that the Department of Health has prepared: (a)"[m]aterials designed to inform concerned persons of public *1153 and private agencies and services available to assist a woman through pregnancy, upon childbirth and while the child is dependent, including a comprehensive list of the agencies available and a description of the manner in which they might be contacted;" and (b) "[m]aterials designed to inform concerned persons of the probable anatomical and physiological characteristics of the fetus at the various gestational ages at which abortion might be performed, including any relevant information on the possibility of fetal survival." The doctor must also explain that this information is available to the patient.
The precise question is whether this provision contravenes the constitutional privacy interest that exists when a woman is trying to decide whether to terminate her pregnancy. In reviewing the consent form prescribed by Massachusetts law, the Bellotti court subdivided the fundamental privacy right extended to the abortion decision into two components:
We approach the use of such forms in terms of the familiar balancing of burdens imposed and interests served, and begin with the fact that the right implicated by this requirement is the fundamental privacy right extended to the abortion decision by Roe v. Wade, supra. But assessing the peculiar nature of the burdens potentially imposed by this provision requires further subdividing that right into what we believe to be two components. One prong of the right protects the process of the decision, guarding against intrusion into the physician-patient relationship essential to the course of decisionmaking; the second prong protects the outcome of the decision, providing a shield against state requirements that attempt to skew the choice one way or another. Id. at 1017.
Considering first the second prong, it may be argued that the Rhode Island requirement that an abortion patient be made aware of the existence of the information does not "skew" a woman's decision because such a skewing effect can only be produced by the nature of the information provided if she chooses to make use of such materials. Merely being made aware of their existence and availability arguably lacks such impact. This conclusion would accord with Bellotti's finding that "an undue burden on the outcome of decisions can result only from the content of a particular form." Id. I see it differently. The disclosure required to be made is not unlike that in Bellotti, which was preliminarily enjoined by the Court.
In Bellotti, the disclosure included a description of fetal characteristics and the woman was required to sign the form at least 24 hours prior to the abortion. She did not have to obtain it from her physician, sign it or read it in his presence, and the physician could comment negatively on the content of the form. In spite of its observation that "the particular fetal description before us is a relatively brief and dispassionate one, and thus not as blatantly offensive as those held unconstitutional by other courts," the First Circuit enjoined the inclusion of the fetal description in the consent form. It noted:
[T]he information is not directly material to any medically relevant fact, ... that requiring women seeking abortions to read this information would cause many of them emotional distress, anxiety, guilt, and in some cases increased physical pain, ... that most women would not want to hear such a description just prior to having an abortion and that most physicians would not consider it good medical practice to provide one, further demonstrating that the information serves as an enforced, unwelcome, and medically contraindicated state lecture. Id. at 1021-1022 (footnotes omitted).
In Rhode Island, the statute requires that the materials describe the fetal characteristics at the various gestational ages at which an abortion may be performed. This is totally inappropriate. It is an attempt by the state to coerce a woman's decision, without regard to her physical and mental health, by the use of information irrelevant *1154 to her decision.[6] It is an extravagant tactic by the state that unduly burdens a woman's fundamental right to a free objective choice. See Planned Parenthood Association v. Ashcroft, 483 F. Supp. 679, 698-99 (W.D.Mo.1980), aff'd in relevant part, 655 F.2d 848, 868 (8th Cir. 1981); Leigh v. Olson, 497 F. Supp. 1340, 1345 (D.N.D.1980); Akron Center for Reproductive Health v. City of Akron, 479 F. Supp. 1172, 1203 (N.D. Ohio 1979), aff'd in relevant part, 651 F.2d 1198, 1206-07 (6th Cir. 1981).
It is true that the mere availability of the information may have no skewing effect if the woman does not seek out the available information, but I cannot read the second component of the privacy right independently of the first. Here, affirmative action is required by the doctor; he must advise his patient that the information is available from the Department of Health.[7] This is unlike the Massachusetts provision, under which the physician had no obligation to do anything. To say that the mandate of the Rhode Island statute merely insures that the patient knows such material is available is delusory. At a minimum, the doctor will have to relate what the materials are, who publishes them, and where they may be obtained. In many cases, depending on the curiosity of the patient at being informed of the existence of these state materials, a doctor may feel compelled to give an evaluation. Indeed, a woman patient may well decide whether or not to peruse the State's publications based on the evaluation she receives from her attending physician. The physician cannot play a passive role in this administering requirement. Such passivity might well be perceived as inconsistent with the doctor's role of medical adviser to the patient.
I conclude that the Rhode Island statute interferes with both components of the privacy right. The affirmative action by the doctor realistically risks sufficient disclosure of the content of the materials as to "skew" the woman's choice one way or the other. It also invades the process of the decision by intruding into the physician-patient relationship and creating precisely the "straightjacket" that must be avoided. In short, the state is utilizing the doctor-patient relationship as a springboard to advance its own views without a compelling reason for doing so. For this reason, subsection 4 of section 2 of the Act is unconstitutional.
The Consent Form
There is little wrong with the consent form; it does not infringe on a woman's fundamental right to an abortion. If a state can require that women seeking abortions give their informed consent, surely it can require that such consent be in writing. The requirement that a copy of the form be available to the patient is similarly unintrusive. This requirement seems fundamental to effective informed consent and to insuring that a woman know precisely what she has chosen to do. The Supreme Court made it clear in Danforth that a state may take minimal and unintrusive steps to assure a woman's informed consent to an abortion.
Conclusion
I conclude that the Act must be stricken in its entirety except for § 23-4.7-4, which requires the department of health to publish certain information, and § 23-4.7-3.1, which will be the subject of a separate hearing.
An order will be prepared accordingly.
NOTES
[1] Rhode Island's informed consent statute provides as follows:
R.I.G.L. 23-4.7-1. Time of Consent. An abortion permitted by law shall be performed only with the informed written consent of the woman at least twenty-four (24) hours prior to the scheduled operation. In the event the scheduled operation is delayed for good medical cause, then the twenty-four (24) hour requirement shall not apply if the informed written consent has been previously complied with in the same seven (7) day time period prior to the scheduled operation.
The prescribed waiting period may be waived where there is an emergency requiring immediate action. The attending physician shall certify in writing the patient's medical record as to the emergency and the medical basis for his opinion.
Simple compliance with the time requirements of this section shall not be prima facie evidence of informed consent.
R.I.G.L. 23-4.7-2. Required disclosure. In order to insure that the consent of the pregnant woman is truly informed consent, an abortion shall be performed only after the woman has signed a consent form acknowledging that she has been informed by the physician who is to perform the abortion as follows:
(1) That she is pregnant and a copy of her pregnancy test is available to her.
(2) That the nature of an abortion has been fully explained, including the probable gestational age of the fetus at the time the abortion is to be performed.
(3) That the medical or surgical procedure to be used has been explained, to include all medical risks, both physical and psychological, associated with the particular abortion procedure to be employed, consistent with good medical practice.
(4) That the printed information prescribed in § 23-4.7-4 is available, if in fact it has been made available by the department of health.
(5) That the woman be informed of all medical risks, both physical and psychological, to herself and the fetus, associated with the alternative of carrying the fetus to term, consistent with good medical practice.
In addition, the physician may inform the woman of any other material facts or opinions or provide any explanation of the above information, which in the exercise of his best medical judgment, is reasonably necessary to allow the woman to give her informed consent to the proposed abortion, with full knowledge of its nature and consequences.
In cases where the woman does not understand English, either the consent form shall be written in a language understood by her, or the physician informing her shall certify on the consent form that in his or her opinion, the information required in this section has been given in such a manner as to be understandable by her; if an interpreter is used, the interpreter shall be named and reference to such use shall be made on the consent form.
R.I.G.L. 23-4.7-3. Consent form requirements Duties of physician. The consent form shall comply with the requirements of § 23-4.7-2. A copy shall be made available to her upon her request.
R.I.G.L. 23-4.7-4. Printed information. The department of health shall, within sixty (60) days after this section becomes law, cause to be published, printed materials that may be easily comprehended in all languages used by significant portions of the population of this state:
(1) Materials designed to inform concerned persons of public and private agencies and services available to assist a woman through pregnancy, upon childbirth and while the child is dependent, including a comprehensive list of the agencies available and a description of the manner in which they might be contacted; and
(2) Materials designed to inform concerned persons of the probable anatomical and physiological characteristics of the fetus at the various gestational ages at which abortion might be performed, including any relevant information on the possibility of fetal survival.
R.I.G.L. 23-4.7-5. Liability of physician. A physician who intentionally, knowingly or recklessly violates the requirements of § 23-4.7-2 shall be fined not more than five hundred dollars ($500), or imprisoned for not more than one (1) year, or both. Failure to provide the woman with the substance of the information pursuant to the requirements of § 23-4.7-2 shall be prima facie evidence of failure to obtain informed consent in an action at law, or in equity.
R.I.G.L. 23-4.7-6. Severability. If any section or provision of this chapter or the application thereof is held invalid, such invalidity shall not affect other sections, provisions or applications, and to this end the sections and provisions of this chapter are hereby declared severable.
[2] See note 1 supra. Just prior to the hearing in this case, the Rhode Island legislature amended the informed consent for abortion statute by adding § 23-4.7-3.1. The new section provides:
Parental Notification for Minors In the case of a pregnant minor, the physician shall exercise reasonable diligence to notify the parent or legal guardian of the minor prior to performing the abortion, if feasible and practicable.
After obtaining a copy of this amendment, plaintiffs moved to amend their complaint to add a challenge to this section. By agreement of the parties, enforcement of the amended statute has been suspended, see Women's Medical Center of Providence, Inc. v. Roberts, 512 F. Supp. 316, 317 n.2 (D.R.I.1981), and a separate hearing on the constitutionality of 23-4.7-3.1 will be conducted at a later date.
At this time I express no opinion whatsoever on the constitutionality of 23-4.7-3.1.
[3] This method of performing an abortion is also known as the "vacuum aspiration" method. To perform this type of an abortion, the physician usually injects a local anesthetic into the cervix. Following this, the physician gradually stretches the opening in the cervix with a series of long, narrow rods known as dilators each somewhat wider than the one before. When the cervical opening has been sufficiently dilated, the physician inserts a blunt-tipped tube into the uterus. This tube is then attached to a suction machine and the products of conception are emptied from the uterus by a gentle suction. After completing this stage, the physician may use a spoon-shaped curette to clean the lining of the uterus. The operation takes from five to seven minutes to complete.
[4] The woman's last menstrual period is used to calculate how far her pregnancy has progressed. Generally, a first trimester abortion will not be performed until seven and one-half weeks after the first day of a woman's last menstrual period. The gestational age of the fetus can be approximated by subtracting two weeks from the time elapsed since the beginning of the woman's period.
[5] I agree with the Seventh Circuit that the concept of "undue burden" used by the Supreme Court in analyzing some recent cases involving alleged restrictions on the right to an abortion causes some confusion regarding the standard to be applied in cases involving first trimester restrictions. See Charles v. Carey, 627 F.2d 772, 777-78 (7th Cir. 1980). The confusion appears to stem from attempts to reconcile the position taken by the Court in Roe v. Wade, which arguably holds that there are no compelling state interests that ever justify a state-imposed burden on the right to a first trimester abortion, with the Court's position in Danforth that limited informed consent requirements may be imposed by the state during the first trimester, and with its position in Maher v. Roe, 432 U.S. 464, 97 S. Ct. 2376, 53 L. Ed. 2d 484 (1977) and Harris v. McRae, 448 U.S. 297, 100 S. Ct. 2671, 65 L. Ed. 2d 784 (1980), that the state may discourage indigents from exercising their right to an abortion by refusing to pay for the procedure. Contrary to the clear indications in Wade and Bolton, the Court in its later cases has allowed some state enactments that regulate the first trimester abortion decision.
Two approaches have emerged as lower federal courts have struggled with the line of Supreme Court abortion decisions. One approach focuses on some Supreme Court language to the effect that if a regulation does not "unduly burden" the first trimester decision, it will be upheld. See Maher v. Roe, 432 U.S. at 473, 97 S.Ct. at 2382; Bellotti v. Baird, 428 U.S. 132, 147, 96 S. Ct. 2857, 2866, 49 L. Ed. 2d 844 (1976). Courts taking this approach conclude from this language that the first inquiry to be undertaken is whether a law "unduly burdens" a woman's right to an abortion. If this threshold determination of undue burden is met, then strict scrutiny applies; if not, the state's justification need only meet the rational relationship test. See Akron Center for Reproductive Health, Inc. v. Akron, 479 F. Supp. 1172, 1200 (N.D.Ohio), aff'd in part, rev'd in part, 651 F.2d 1198 (6th Cir. 1981); Women's Community Health Center, Inc. v. Cohen, 477 F. Supp. 542, 545 (D.Me. 1979).
The second approach stems from a different perspective. In these cases, the courts determine whether the law or regulation imposes a significant or non de minimis burden on the woman's exercise of her fundamental right. If such a burden is not imposed by the regulation, then the law need satisfy only the relaxed standard of reasonableness. However, if a sufficient degree of interference with the abortion decision can be shown, the regulation has to be supported by a compelling state interest and must be narrowly tailored to serve that interest. See, e.g., Akron Center for Reproductive Health, Inc. v. Akron, 651 F.2d 1198, 1204 (6th Cir. 1981); Planned Parenthood League of Mass. v. Bellotti, 641 F.2d 1006, 1014-15 (1st Cir. 1981); Charles v. Carey, 627 F.2d 772, 777 (7th Cir. 1980). I believe that the latter approach represents the better approach in reviewing these statutes. I am persuaded by the reasoning of the Seventh Circuit in Charles v. Carey:
[T]he term "undue burden" defines the ultimate constitutional issue, not merely the threshold requirement for strict scrutiny. When describing specifically the burden of the party challenging a state regulation, the Supreme Court has not used the term "undue" .... The threshold question whether there is a "burden" or "direct interference" in the pregnancy termination decision requires the plaintiff merely to show the requisite degree of interference. If the interference is sufficiently substantial and not de minimis, the State has to show the compelling basis for the law, that is, that the burden is not "undue" or unjustifiable.
627 F.2d at 777 (citations omitted).
[6] The information provided by the Rhode Island statute may be particularly irrelevant because it discloses fetal characteristics at various gestational ages. Thus, a woman who is eight weeks pregnant may be informed of the physiological characteristics of an 18 week fetus. The First Circuit has recognized that such a disclosure would be "clearly irrelevant and potentially misleading." Bellotti at 1022 n.27.
[7] Subsection 4 disclosures require the physician to inform the patient that the printed information is available, if it has been made available by the Department of Health. Under section 4 of the Act, the Department of Health is required to publish the material within 60 days of the enactment of the Act. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2394132/ | 964 S.W.2d 265 (1997)
Thos D. MURPHY, Jr., Ray Hawkins, Trudi Hestand, and Tracy Hawkins, individually and on behalf of Colonial Food Stores, Inc. and Hawkins-Rochester-Murphy, Inc., and the Bankruptcy Estate of Louis Rochester, Intervenor, Petitioners,
v.
Robert CAMPBELL, Rory McLaughlin, Joe Fleckinger, and Chuck Schmidt, individually and d/b/a agents for Deloitte & Touche, a partnership, formerly known as Touche Ross & Co., a partnership, and as agents for Touche Ross & Co., and Touche Ross & Co., Respondents.
No. 96-0079.
Supreme Court of Texas.
Argued September 5, 1996.
Decided December 11, 1997.
Rehearing Overruled May 8, 1998.
*266 James Winston Krause, Cherry K. Bounds, Daniel M. Grant, Austin, John H. Green, Jr., Odessa, for petitioners.
Charles J. Muller, III, David Langdon Doggett, Farley P. Katz, Anthony E. Rebollo, San Antonio, for respondents.
*267 HECHT, Justice, delivered the opinion of the Court, in which PHILLIPS, Chief Justice, GONZALEZ, OWEN and BAKER, Justices, joined.
Plaintiffs in this case complain that their accountants gave them faulty tax advice. Plaintiffs assert causes of action for negligence, fraud, breach of implied warranty, and violations of the Texas Deceptive Trade PracticesConsumer Protection Act, TEX. BUS. & COM.CODE §§ 17.41-.63. Principal among the several issues before us is the proper application of limitations to plaintiffs' claims. The district court granted defendants summary judgment. The court of appeals affirmed except as to plaintiffs' fraud claim, which it remanded. Bankruptcy Estate of Louis Rochester v. Campbell, 910 S.W.2d 647 (Tex.AppAustin 1995). We conclude that summary judgment was proper on all plaintiffs' claims.
I
Colonial Food Stores, Inc. operated more than 125 convenience stores, mostly in West Texas. Its three major stockholdersThomas D. Murphy, Jr., Ray Hawkins, and Louis Rochesterwanted to sell the business if they could each receive $2 million net of taxes or other obligations. The price offered by the most promising purchaser, National Convenience Stores, would not yield the three stockholders that amount unless Colonial's federal tax obligation was based on payment of depreciated cost for Colonial's equipment rather than its higher fair market value. By this allocation of the purchase price Colonial could avoid recognizing any taxable gain on the sale of its equipment.
Colonial's accountant and auditor, Touche Ross & Co., advised Colonial and its stockholders concerning the tax consequences of the sale at a meeting on April 27, 1983. Although the stockholders were aware that the Internal Revenue Service would probably challenge the allocation of the purchase price to equipment, they contend that Touche Ross advised that the allocation was proper. Within a few days the transaction with NCS closed, and about a year later, on April 25, 1984, Colonial dissolved, distributing all its assets and liabilities to its stockholders (the three named above and a trust for Hawkins' two children). The IRS audited Colonial's tax returns and on October 27, 1986, advised Colonial's stockholders that it did not approve the allocation of sales proceeds to equipment and that it considered additional taxes to be due. On June 11, 1987, the IRS issued a formal deficiency notice.
Colonial's stockholders filed suit in the United States Tax Court on September 8, 1987, to protest the IRS ruling. Colonial's stockholders had an appraisal of Colonial's equipment prepared that showed a value less than depreciated cost, supporting Touche Ross's advice. Nevertheless, Colonial's stockholders settled with the IRS before trial, agreeing to pay $735,596.98 in taxes plus interest. The Tax Court entered a stipulated final decision on November 16, 1989. On April 5, 1990, the IRS assessed the taxes and interest.
On June 11, 1991, Colonial's stockholders ("plaintiffs") sued Touche Ross and others (collectively, "Touche Ross"), complaining of Touche Ross's tax advice concerning the tax consequences of the Colonial sale and the money to be received by plaintiffs. Plaintiffs pleaded that Touche Ross was negligent, was fraudulent, breached an implied warranty that it would perform its services in a good and workmanlike manner, and violated the DTPA. Plaintiffs later amended their pleadings to allege that Touche Ross had also defrauded them by not disclosing that it was advising NCS at the same time it was advising Colonial.
Touche Ross moved for summary judgment on all plaintiffs' claims on the grounds that they were barred by limitations and that plaintiffs suffered no damages. Additionally, Touche Ross argued that the warranty claim should fail because the law recognizes no such cause of action, and that the fraud claim should fail because the evidence established that Touche Ross made no fraudulent misrepresentation. The district court granted Touche Ross's motion without specifying the reasons, and plaintiffs appealed.
The court of appeals held that all plaintiffs' causes of action accrued on the date the IRS sent plaintiffs a deficiency notice, which was *268 exactly four years before plaintiffs sued. Thus, the court concluded that plaintiffs' negligence, warranty, and DTPA claims, all subject to two-year statutes of limitations, were barred, but that plaintiffs' fraud claim, subject to a four-year limitations period, was not. The court did not address Touche Ross's argument that the evidence established that it made no misrepresentation. The court determined that fact issues remained whether plaintiffs had individual claims against Touche Ross distinct from Colonial's claim. (Because Colonial did not sue within three years of its dissolution, its claim was barred. Tex.Rev.Civ. Stat. Ann. art. 1396-7.12 (Vernon 1997).) Consequently, the court of appeals remanded only plaintiffs' fraud claim and affirmed the balance of the district court's judgment. 910 S.W.2d 647.
Plaintiffs and Touche Ross both appealed to this Court.
II
We first consider several matters which could, but do not, eliminate the limitations issues, but which do narrow those issues.
A
Touche Ross argues that plaintiffs lack standing to assert their claims because any wrong Touche Ross did was to Colonial, not its stockholders. We disagree.
In Wingate v. Hajdik, we stated:
A corporate stockholder cannot recover damages personally for a wrong done solely to the corporation, even though he may be injured by that wrong.
Ordinarily, the cause of action for injury to the property of a corporation, or the impairment or destruction of its business, is vested in the corporation, as distinguished from its stockholders, even though it may result indirectly in loss of earnings to the stockholders. Generally, the individual stockholders have no separate and independent right of action for injuries suffered by the corporation which merely result in the depreciation of the value of their stock. This rule is based on the principle that where such an injury occurs each shareholder suffers relatively in proportion to the number of shares he owns, and each will be made whole if the corporation obtains restitution or compensation from the wrongdoer. Such action must be brought by the corporation, not alone to avoid a multiplicity of suits by the various stockholders and to bar a subsequent suit by the corporation, but in order that the damages so recovered may be available for the payment of the corporation's creditors, and for proportional distributions to the stockholders as dividends, or for such other purposes as the directors may lawfully determine.
This rule does not, of course, prohibit a stockholder from recovering damages for wrongs done to him individually "where the wrongdoer violates a duty arising from contract or otherwise, and owing directly by him to the stockholder." However, to recover individually, a stockholder must prove a personal cause of action and personal injury.
795 S.W.2d 717, 719 (Tex.1990) (citations omitted). Applying these principles, we held that one corporate stockholder could not recover damages from another for misappropriation of corporate assets.
These same principles provide plaintiffs standing in the present case. Touche Ross counseled not only Colonial but its stockholders. The tax treatment of the sale was less important to Colonial, which contemplated dissolution, than to its stockholders, upon whom the effects of tax treatment would directly fall. The three major stockholders were unwilling to sell Colonial's assets to NCS unless they received a minimum net amount as a result. Touche Ross undertook to advise not only Colonial but its stockholders, and the stockholders suffered a direct loss as a result of the IRS ruling. In these circumstances, plaintiffs have individual causes of action against Touche Ross separate from Colonial's.
B
Touche Ross argues that Texas law does not recognize a cause of action for breach of an implied warranty of professional services. We agree.
*269 In Dennis v. Allison, 698 S.W.2d 94, 96 (Tex.1985), we held that it was unnecessary to extend a cause of action for breach of an implied warranty to a patient physically abused by her psychiatrist because she had other adequate causes of action available to her. We reiterated in Parkway Co. v. Woodruff, 901 S.W.2d 434, 439 (Tex.1995), that "an implied warranty will not be judicially imposed unless there is a demonstrated need for it."
There is no more need for an additional remedy for accounting malpractice than there is for medical malpractice. A plaintiff may obtain full redress in an action for negligence or breach of contract. In addition, the DTPA provides relief in certain circumstances. TEX. BUS. & COM.CODE § 17.49(c)(d). Accordingly, we hold that there is no cause of action for breach of an implied warranty of accounting services. Touche Ross was entitled to summary judgment on plaintiffs' warranty claim.
C
Touche Ross argues that the summary judgment evidence establishes that it made no fraudulent misrepresentation. We agree.
Although plaintiffs claimed Touche Ross misrepresented that the sales price allocation "would withstand an Internal Revenue Service audit", no evidence supports this assertion. In fact, the evidence is to the contrary. The record establishes that plaintiffs all knew that an IRS audit was likely and that the IRS would probably challenge the sales price allocation. Apart from Touche Ross's denial that it made any misrepresentations concerning the possibility of eventual taxation, the only evidence on the subject is plaintiff Hawkins' testimony that "there was not any discussion about whether the allocation would be respected by the IRS". Plaintiff Hawkins stated in an affidavit that his understanding was that the allocation would withstand audit, but he does not ascribe the basis of that understanding to anything Touche Ross said or did.
Furthermore, Touche Ross's advice that the price allocated for the equipment should be its depreciated cost was not false. Indeed, plaintiffs obtained an appraisal supporting Touche Ross's advice and continue to believe that the IRS overvalued the equipment. Plaintiffs' complaint is not that Touche Ross undervalued the equipment, but that it did not advise them properly about the ultimate treatment of the sale and the tax consequences.
Plaintiffs also complain that Touche Ross did not disclose its relationship with NCS, but the evidence establishes that plaintiffs were not harmed by that nondisclosure. Plaintiffs assert that their damages were caused entirely by Touche Ross's bad advice, not by any conflict of interest Touche Ross may have had. Even assuming that such a conflict of interest existed, it provided only a motive for Touche Ross's bad advice. Any nondisclosure, standing alone, was not fraud.
In short, plaintiffs' claims are for malpractice, not fraud. Touche Ross was entitled to summary judgment on plaintiffs' fraud claims.
D
Finally, Touche Ross argues that the evidence establishes that plaintiffs have suffered no damages because they received full fair market value for Colonial. We disagree. The argument simply ignores plaintiffs' assertion that they would not have sold Colonial at all unless the three major stockholders received $2 million apiece. If plaintiffs were misled by Touche Ross's advice into thinking that they would receive more, the fact that they received all Colonial was worth does not vitiate their complaints against Touche Ross.
III
We are left with the issue of applying limitations to accounting malpractice claims involving tax advice. Touche Ross argues that such claims accrue when the taxpayer knows or should know that the advice he received was faulty, and no later than the IRS's issuance of a formal deficiency notice, triggering the taxpayer's right to sue in the Tax Court. Plaintiffs argue that such claims do not accrue until any litigation is completed *270 and the IRS has issued an assessment of taxes. We agree with Touche Ross.
A
The parties agree, and we hold, that a common-law action for accounting malpractice is subject to section 16.003 of the Civil Practice and Remedies Code, which provides that suit must be brought "not later than two years after the day the cause of action accrues." Since the statute does not specify when accrual occurs, we must make that determination.
In S.V. v. R.V., we explained: "As a rule, we have held that a cause of action accrues when a wrongful act causes some legal injury, even if the fact of injury is not discovered until later, and even if all resulting damages have not yet occurred." 933 S.W.2d 1, 4 (Tex.1996)(citing Trinity River Auth. v. URS Consultants, Inc., 889 S.W.2d 259, 262 (Tex.1994), and Quinn v. Press, 135 Tex. 60, 140 S.W.2d 438, 440 (1940)). This "legal injury" rule is often traced to Houston Water-Works Co. v. Kennedy, 70 Tex. 233, 8 S.W. 36 (1888).
In Kennedy, the defendant cut an arch in plaintiff's building while installing a water pipe in 1884. The arch, being concealed, was not discoverable until it eventually caused the building to settle and crack. Plaintiff brought his negligence action in 1887, three years after the alleged negligence but within two years after the injury became manifest. The Court concluded that the action was barred by limitations:
If ... the act of which the injury was the natural sequence was a legal injury,by which is meant an injury giving cause of action by reason of its being an invasion of a plaintiff's right,then, be the damage however slight, limitation will run from the time the wrongful act was committed, and will bar an action for any damages resulting from the act.... [A] mere want of knowledge by the owner of injury to his property does not prevent the running of the statute.
8 S.W. at 37-38. In other words, because the negligently cut arch constituted a legal injury, limitations began to run immediately.
Trinity River Authority, 889 S.W.2d at 262 (quoting Kennedy, 8 S.W. at 37-38).
"We have not applied [the legal injury] rule without exception, however, and have sometimes held that an action does not accrue until the plaintiff knew or in the exercise of reasonable diligence should have known of the wrongful act and resulting injury." S.V., 933 S.W.2d at 4. This exception, which we call the "discovery rule", applies in cases of fraud and fraudulent concealment, and in other cases in which "the nature of the injury incurred is inherently undiscoverable and the evidence of injury is objectively verifiable." Computer Assoc. Int'l, Inc. v. Altai, Inc., 918 S.W.2d 453, 456 (Tex.1996); S.V., 933 S.W.2d at 6. We explained the inherently-undiscoverable requirement in S.V. as follows:
To be "inherently undiscoverable", an injury need not be absolutely impossible to discover, else suit would never be filed and the question whether to apply the discovery rule would never arise. Nor does "inherently undiscoverable" mean merely that a particular plaintiff did not discover his injury within the prescribed period of limitations; discovery of a particular injury is dependent not solely on the nature of the injury but on the circumstances in which it occurred and plaintiff's diligence as well. An injury is inherently undiscoverable if it is by nature unlikely to be discovered within the prescribed limitations period despite due diligence.
933 S.W.2d at 7.
A person suffers legal injury from faulty professional advice when the advice is taken. However, the discovery rule may apply to delay accrual of a cause of action complaining of such advice because of the difficulty a lay person has in knowing of the fault in the advice. Legal malpractice, for example, is inherently undiscoverable because "`[i]t is unrealistic to expect a layman client to have sufficient legal acumen to perceive an injury at the time of the negligent act or omission of his attorney.'" Willis v. Maverick, 760 S.W.2d 642, 645 (Tex.1988) (citation omitted); S.V., 933 S.W.2d at 6. Thus, the accrual of a legal malpractice *271 claim, including a claim for faulty tax advice, is governed by the discovery rule. The same rule should apply whether the advisor is a lawyer or an accountant. It is most unlikely that a client would know that tax advice was faulty at the time he received it. Indeed, the very reason to seek expert advice is that tax matters are often not within the average person's common knowledge. We thus conclude that accounting malpractice involving tax advice is inherently undiscoverable.
Also, the injury flowing from faulty tax advice is objectively verifiable. When, as here, the taxing authority prevails in tax court, the fact of injury is indisputable. Similarly, the settlement or payment of a tax claim that results from faulty professional advice results in a clear, objectively verifiable injury.
Because an accounting malpractice claim involving tax advice is inherently undiscoverable, and injury is objectively verifiable, the discovery rule applies. Such a claim accrues when the claimant knows or in the exercise of ordinary diligence should know of the wrongful act and resulting injury. The same rule applies by statute in DTPA claims. TEX. BUS. & COM.CODE § 17.565.
B
As in most discovery rule cases, the date a particular person becomes charged with knowledge of accounting malpractice involving tax advice depends upon the circumstances. The evidence in the present case reflects procedures involving federal income tax claims. The taxpayer learns something of the IRS's position during an audit. The report of the auditor's findings provides the taxpayer additional information, although it does not represent the IRS's final position; the taxpayer may protest to the IRS appeals office within thirty days of receiving the auditor's report. Only after all administrative appeals have been exhausted does the IRS issue a formal deficiency notice. Within ninety days of that notice the taxpayer may challenge the IRS's position in Tax Court. If the taxpayer does not do so, or when that litigation is concluded, the IRS assesses any tax due. See generally 4 Boris I. Bittker & Lawrence Lokken, Federal Taxation of Income Estates and Gifts ch. 111-113 (2d ed.1992); Michael I. Saltzman, IRS Practice & Procedure, ch. 10 (2d ed.1991).
Plaintiffs argue that not until this last step in the process, when the taxpayer's liability is certain, does an action for malpractice involving tax advice accrue. But under the discovery rule, such an action accrues, not when injury becomes certain, but when the claimant should know of his injury. This cannot occur later than the receipt of the deficiency notice, when the IRS takes a final, formal position. That was our holding in Atkins v. Crosland, 417 S.W.2d 150 (Tex. 1967). Although we referred in that case to the IRS's "assessment", it is apparent from the recitation of the facts and the timing of the events in that case that we did not mean the final assessment but rather, the earlier deficiency notice. See Zidell v. Bird, 692 S.W.2d 550, 557 (Tex.App.Austin 1985, no writ)(describing the deficiency assessment in Atkins as coming before judicial review and not representing inevitable injury to the taxpayer). The California Supreme Court has also referred to the deficiency notice as an assessment. International Engine Parts, Inc. v. Feddersen & Co., 9 Cal. 4th 606, 38 Cal. Rptr. 2d 150, 159, 888 P.2d 1279, 1288 (1995)(en banc)(citing Atkins).
But a taxpayer may know his advice was faulty long before he receives a deficiency notice. For example, if a taxpayer sought other opinions upon receipt of an audit notice, or even earlier, the information obtained might put him on notice that the advice he received was wrong. No Texas court has read Atkins to hold that a cause of action for faulty advice never accrues until the taxpayer receives a deficiency notice. See Hoover v. Gregory, 835 S.W.2d 668, 673 (Tex.App. Dallas 1992, writ denied) ("We, however, read Atkins as establishing a general rule that a taxpayer's cause of action accrues on a fact specific basis when he discovers a risk of harm to his economic interests, whether that be at the time of assessment or otherwise."); Ponder v. Brice & Mankoff, 889 S.W.2d 637, 641-642 (Tex.App.Houston [14th Dist.] 1994, writ denied)(quoting Hoover); Sutton v. Mankoff, 915 S.W.2d 152, 157 (Tex.App. *272 Fort Worth 1996, writ denied)(citing Hoover and Ponder).
Here the evidence does not establish when plaintiffs knew or should have known that Touche Ross's advice was flawed. As the deficiency notice exactly four years before plaintiffs filed suit marked the latest date on which their malpractice action could have accrued, their negligence and DTPA claims are barred by the two-year statute of limitations unless the running of limitations was tolled by the Tax Court litigation, the issue to which we now turn.
C
Plaintiffs contend that the tolling rule in Hughes v. Mahaney & Higgins, 821 S.W.2d 154 (Tex.1991), applies in the present case. We disagree.
In Hughes, plaintiffs claimed that their lawyer erred in failing to name them temporary managing conservators of the child they planned to adopt. When the biological mother had a change of heart, she sued for custody of the child, and plaintiffs counterclaimed for termination of her rights. The court of appeals reversed a judgment for plaintiffs, holding they lacked standing to assert their claim. Plaintiffs then sued their lawyer for malpractice, contending that they would have prevailed in the parental rights termination suit if they had been named temporary managing conservators originally. We held that limitations was tolled on the malpractice claim during the pendency of the termination litigation. Id. at 157. We explained that if limitations were not tolled, plaintiffs would have been required to file the malpractice suit while the termination suit was still pending, and to assert in one that their attorney's actions were proper and in the other that his actions were improper. Id. at 156-157.
Plaintiffs in the present case argue that if they had been required to file their malpractice claim while the Tax Court proceeding was pending, they, like the plaintiffs in Hughes, would have been forced to take inconsistent positions. They would have argued to the Tax Court that Touche Ross was correct in its advice, but in the malpractice action they would have argued that Touche Ross was incorrect. Thus, plaintiffs argue, they are entitled to the same rule applied in Hughes.
But Hughes does not hold that limitations is tolled whenever a litigant might be forced to take inconsistent positions. Such an exception to limitations would be far too broad. We expressly limited the rule in Hughes to attorney malpractice in the prosecution or defense of a claim that results in litigation. In such circumstances, to require the client to file a malpractice claim against the lawyer representing him in another case would necessarily make it virtually impossible for the lawyer to continue his representation. The client's only alternative would be to obtain other counsel. That consideration, coupled with the necessity of taking inconsistent positions, persuaded us to adopt a tolling rule in Hughes. We restricted it to the circumstances presented.
No similar impediment prevented plaintiffs in the present case from suing Touche Ross while the Tax Court litigation was pending. Filing a malpractice suit against Touche Ross would not have affected its testimony in the tax case. While it is unreasonable to expect an attorney to continue to represent a client who is simultaneously suing the attorney for mishandling the very same matter, it is not unreasonable to expect an expert to testify consistently regardless of whether his client is suing him. The relationship between attorney and client is simply different from that between party and witness or party and expert. While prosecuting both the tax suit and a malpractice suit at the same time would have required plaintiffs to take inconsistent positions, they could have avoided this by requesting the court to abate the malpractice case pending resolution of the tax suit. A court in such circumstances should abate the malpractice case pending final resolution of the tax suit. Plaintiffs in this case simply would not have suffered the prejudice the Hughes plaintiffs would have suffered by either suing the lawyer who was still representing them and thereby losing his services or allowing limitations to run against their malpractice claim.
Accordingly, we hold that Hughes does not toll limitations in this case.
*273 IV
Justice Spector's dissent mischaracterizes our application of the discovery rule as holding that "an accounting malpractice cause of action accrues when a taxpayer knows or should know of a mere risk of injury". Post at 274. As in all discovery rule cases, a cause of action accrues when the plaintiff knows or reasonably should know that he has been legally injured by the alleged wrong, however slightly. The fact that the plaintiff's actual damages may not be fully known until much later does not affect the determination of the accrual date for alleged accounting malpractice any more than it does for legal malpractice.
Justice Spector's dissent would hold that a cause of action for faulty tax advice accrues when a "tax dispute is resolved"whether by the taxpayer's acceptance of an IRS assessment, negotiation of a settlement, or exhaustion of judicial remedies. Post at 274. We are not aware of any precedent for allowing a plaintiff to choose the date of accrual of a cause of action, and the dissent cites none. While it may be necessary to abate a malpractice suit pending resolution of a dispute with the taxing authority, we view that procedure as preferable to holding that limitations on a plaintiff's claim begins to run when plaintiff decides it should.
Justice Spector's dissent would also expand Hughes to toll limitations whenever a party's claims would require the party to take inconsistent positions. Hughes is not so broad. It is expressly limited to claims against a lawyer arising out of litigation where the party must not only assert inconsistent positions but must also obtain new counsel. That factor is not present when the allegedly negligent party is an accountant. A lawyer, like an accountant, could reasonably be expected to testify on a client's behalf and in defense of his professional advice despite the client's assertions of malpractice, but a lawyer could not reasonably be expected to continue to represent the client under such circumstances.
JUSTICE ABBOTT'S separate dissent states: "There is no need for an accountant to be subject to a malpractice claim if the Tax Court concludes that his client does not owe additional taxes and the accountant's advice was sound." Post at 276. The amicus curiae brief filed on behalf of the Texas Society of Certified Public Accountants takes a different view of accountants' "need" for prompt adjudication of malpractice claims. That brief explains:
When alleged malpractice claims are not brought within a reasonable period after they are discovered or should have been discovered, accountants are severely prejudiced in mounting their defense: witnesses often cannot be located or have forgotten critical facts and documents frequently are misplaced or destroyed. Moreover, when accountants face the prospect of potential claims for prolonged and indeterminate periods of time, the policy of repose underlying the statute of limitations is undermined.
The amicus argues in favor of the rule we have adopted as being fair to both plaintiffs and defendants in accounting malpractice casesproviding plaintiffs an ample opportunity to file suit from the time they know or reasonably should know of the faulty advice, and assuring that defendants, in the words of the amicus, "will not be faced with the specter of litigating decade-old claims." Justice Abbott's concern for accountants does not appear to be shared by the accountants themselves.
* * * * * *
For the reasons we have explained, the district court correctly granted Touche Ross summary judgment on all plaintiffs' claims. The court of appeals' remand of plaintiffs' fraud claim is reversed, its judgment is modified to affirm the district court's judgment in all respects, and as modified, the court of appeals' judgment is affirmed.
ABBOTT, J. filed a dissent.
HANKINSON, J., did not participate in the decision.
SPECTOR, Justice, joined by ABBOTT, Justice, and joined in Part I by ENOCH, Justice, dissenting.
Thirty years ago, this Court held that a taxpayer's malpractice cause of action *274 against an accountant accrues when the taxpayer knows or should know that he or she has been actually injured and the tort complained of is complete. Atkins v. Crosland, 417 S.W.2d 150 (Tex.1967). Today the Court holds, in effect, that an accounting malpractice cause of action accrues when a taxpayer knows or should know of a mere risk of injury, before any actual injury has occurred. Because the Court misapplies Atkins, and because this case should also be controlled by the tolling rule of Hughes v. Mahaney & Higgins, 821 S.W.2d 154 (Tex.1991), I dissent.
I.
Malpractice requires legal injury as an element of the cause of action. Peeler v. Hughes & Luce, 909 S.W.2d 494, 496 (Tex. 1995) (malpractice cause of action arises only when there has been a breach of duty that proximately causes damages). In Atkins, this Court held that the taxpayer's cause of action against his accountant for malpractice arose, not when the accounting error was committed, but when the Commissioner of Internal Revenue assessed a deficiency against the taxpayer. 417 S.W.2d at 153. This was so because the taxpayer took no further action to contest the deficiency. Consequently, actual injury resulted and the tort was complete. Id.[1]
In tax cases, where disputing the amount of tax liability is routine,[2] there is no legal injury until the tax dispute is resolved. Atkins held that the cause of action arises when a deficiency is assessed, not because that particular stage of a tax liability dispute has special significance, but because that is when the deficiency is determined in that particular case. When the assessment is no longer in dispute, the existence of an injury can then be determined, an essential element of the malpractice cause of action. See Atkins, 417 S.W.2d at 153-54 (citing a similar rule in Linkenhoger v. American Fidelity & Cas. Co., 152 Tex. 534, 260 S.W.2d 884 (1953)).
In this case, it was the judgment of the tax court that determined whether there would be liability, thus completing the tort. See Peat, Marwick, Mitchell & Co. v. Lane, 565 So. 2d 1323 (Fla.1990) (holding that when the accountant did not acknowledge error, the limitations period commenced when the tax court entered its judgment). Here, the plaintiffs suffered no actual injury upon receiving the notice of deficiency.[3] Rather, the deficiency notice made the plaintiffs aware of a mere risk of harm: the possibility that Touche Ross may have committed malpractice that could result in damages. Actual injury, however, occurs only when the taxpayer, due to the accountant's malpractice, accepts the IRS's assessment, negotiates a settlement, or exhausts appeal in the courts.
By holding that the plaintiffs' cause of action accrued when they became aware of a risk of harm rather than when they became aware of an actual injury, the Court misapplies Atkins in a particularly ill-advised way. Essentially, the Court holds that a plaintiff can "discover" an injury before the injury occurs and before "the tort complained of [is] completed." Atkins, 417 S.W.2d at 153. This holding runs contrary not only to common sense but also to our established jurisprudence on the statute of limitations.[4] Under *275 the Court's view, a taxpayer could sue for malpractice, and then prevail in the underlying tax dispute, proving that there was no actual injury in the first place. Further, by forcing taxpayers to sue their accountants before it is possible to determine whether a wrong has been committed, the Court's decision will have the practical effect of encouraging needless litigation and wasting valuable court resources on suits that will ultimately be abandoned. See International Engine Parts, Inc. v. Feddersen & Co., 9 Cal. 4th 606, 38 Cal. Rptr. 2d 150, 159, 888 P.2d 1279, 1287 (1995); United States Nat'l Bank v. Davies, 274 Or. 663, 548 P.2d 966, 970 (1976).
II.
The Court errs also by narrowing our holding in Hughes.[5] 821 S.W.2d 154. Under Hughes, limitations are tolled on a legal malpractice claim until resolution of the underlying litigation in which the attorney may have breached a duty. The reasons for this rule are twofold. First, as the Court acknowledges today, the plaintiff should not be forced to take inconsistent positions, arguing in the malpractice suit that the attorney acted negligently at the same time the client's self-interest requires supporting the attorney's actions in the underlying suit. See Peat, Marwick, 565 So.2d at 1326. Second, "[l]imitations are tolled for the second cause of action because the viability of the second cause of action depends on the outcome of the first." Hughes, 821 S.W.2d at 157.
The applicability of Hughes to this case goes beyond the inconsistent positions problem. Although Hughes was an attorney malpractice action, accounting malpractice involving tax advice is similar to legal malpractice for limitations purposes, as the majority acknowledges. 964 S.W.2d at 272 (citing Willis v. Maverick, 760 S.W.2d 642 (Tex. 1988)). The majority fails to acknowledge, however, that the concerns behind the decision in Hughes apply with equal force to the case at bar. The plaintiffs in this case had to hire another accounting firm during the tax court proceedings, just as the plaintiffs in Hughes would have been forced to obtain new counsel in the underlying lawsuit after filing a malpractice action against their original attorney.
Further, the Court suggests that the plaintiffs in this case could have filed and abated the malpractice action during the pendency of the tax court action. That suggestion could have applied equally to the plaintiffs in Hughes, but we rejected it as overly burdensome on the plaintiffs and inconsistent with the discovery rule's purposes. In addition, to do so would allow the malpractice cause of action to accrue before the merits of the underlying claim are determined. In essence, plaintiffs are forced to sue before their claim is ripe. See City of El Paso v. Madero Dev., 803 S.W.2d 396 (Tex.App.El Paso 1991, writ denied). Taxpayers who rely on an errant accountant's advice to pursue a dispute through the lengthy tax court appeals process might have no cause of action if the statute runs from the notice of deficiency, as the majority would have it. See Peat, Marwick, 565 So. 2d 1323.
Because all of the justifications for the attorney-malpractice rule in Hughes apply equally to accounting malpractice, the Court is unjustified in limiting Hughes to the facts of that case. The Court's holding today not only refuses to extend Hughes, but it severely restricts that decision's application. Because of the similarities between legal malpractice and accounting malpractice, and their potential for overlap, I would hold that even if a tort cause of action has accrued, the statute of limitations is tolled during the pendency of the tax liability dispute. This holding would have prevented the plaintiffs *276 from being forced into inconsistent positions in the two cases and allowed the plaintiffs to determine before suing if they had been wronged.
III.
Statutes of limitations balance competing interests: giving potential plaintiffs a reasonable time to present their claims while fixing a point beyond which potential defendants can rest assured that they will not be sued for past actions. By holding that a cause of action for accounting malpractice accrues, at the latest, when the plaintiff receives a notice of tax deficiency, the Court has upset that balance. Because the Court forces accounting malpractice plaintiffs to sue before they have been actually injured and to take inconsistent positions in the underlying litigation, I dissent.
ABBOTT, Justice, dissenting.
Why would a client want to file a malpractice lawsuit against his accountant when the client may ultimately prevail in his dispute with the Internal Revenue Service, thus making a malpractice action unnecessary? Because the Court today requires such a result. According to the Court, taxpayers who may ultimately succeed in overturning a tax deficiency must nevertheless sue their accountants after receiving the deficiency to preclude the expiration of limitations.
I believe this fosters unnecessary litigation. There is no need for an accountant to be subject to a malpractice claim if the Tax Court concludes that his client does not owe additional taxes and the accountant's advice was sound. While the Court states that taxpayers can file a malpractice action and then abate the action until the tax suit is resolved, such a hurry-up-and-wait approach is contrary to our efforts to expedite the litigation process.
For these reasons, and for the reasons set forth by Justice Spector, I dissent.
NOTES
[1] The majority's use of Atkins in its discovery rule discussion is particularly inappropriate as the Atkins opinion does not even mention the rule. 964 S.W.2d at 271.
[2] Challenging deficiency notices from the IRS is such a routine part of doing business and paying taxes that the IRS itself allows the costs to be deducted. See, e.g., Rev. Rul. 92-29, 1992-1 C.B. 20 (allowing a deduction for the costs of resolving asserted tax deficiencies of a sole proprietor's business); see also Earl C. Gottschalk, Jr., Fighting Uncle Sam: Weigh the Costs and Probable Benefits of Your Claim Before Taking on the IRS, Wall St. J., Mar. 8, 1991, at R24.
[3] The IRS's notice of deficiency in this case, which the Court holds triggered the accrual of the plaintiffs' cause of action, differs significantly from the final assessment in Atkins. Penalties may not be assessed until either ninety days after the notice, if the taxpayer does not sue in tax court, 26 C.F.R. § 301.6213-1(a)(2), or after final judgment in the tax court or court of appeals. 26 U.S.C. § 7481(a). If the IRS is prohibited from assessing penalties, it is difficult to see how an injury triggering a cause of action for malpractice could have occurred.
[4] I take issue with those courts of appeals that have substituted a "risk of harm" requirement for an actual harm requirement. See Ponder v. Brice & Mankoff, 889 S.W.2d 637, 642-43 (Tex. App.Houston [14th Dist.] 1994, writ denied); Hoover v. Gregory, 835 S.W.2d 668, 673 (Tex. App.Dallas 1992, writ denied); Zidell v. Bird, 692 S.W.2d 550 (Tex.App.Austin 1985, no writ). This Court has consistently reiterated that the plaintiff must know or have reason to know of the wrongful act and actual injury to trigger limitations under the discovery rule. See S.V. v. R.V., 933 S.W.2d 1, 4 (Tex.1996); Trinity River Auth. v. URS Consultants, Inc., 889 S.W.2d 259, 262 (Tex.1994) ("the cause of action is deemed not to accrue until the injury becomes discoverable").
[5] While JUSTICE ENOCH does not join in Part II, he agrees that the Court misreads Hughes. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3771640/ | This is an appeal on questions of law from a judgment of the Common Pleas Court, Division of Domestic Relations, awarding the custody and control of the minor child of the parties hereto to the defendant, the father of such child.
The record reveals that on February 5, 1953, the plaintiff, appellant herein, Wilma Fae Lindsay, was granted a divorce from the defendant, appellee herein, Roscoe G. Lindsay, and she was also awarded the custody and control of their minor child, Brenda Lindsay. The defendant was also ordered to pay support money for the child, and, being in default, he was cited on several occasions for contempt for failure to comply.
On August 22, 1956, the defendant filed a motion seeking a change of custody of the child. This motion was sustained and the court journalized the following entry:
"On motion of defendant for change of custody of minor child of parties hereto, this cause came on to be heard on [sic] open court by the referral officer on said motion and the testimony of the parties hereto and witnesses called by said parties, *Page 147
and the court being fully advised in the matter finds the motion of the defendant well taken and it is therefore ordered and adjudged that the defendant is hereby and herewith awarded the custody and control of the minor child of the parties hereto, Breda [sic] Lindsay, age four years, until further order of the court.
"It is further ordered and decreed that said child's mother, plaintiff herein, shall have reasonable rights of visitation with said child. This order is effective as of October 24, 1956, to all of which plaintiff, by and through her counsel excepts."
The bill of exceptions reveals that the motion came on for hearing before the referral officer of the Court of Domestic Relations and that at the outset counsel for the plaintiff objected to the referee hearing the case, urging that this would be in violation of rights guaranteed to the plaintiff under the federal and state Constitutions. This objection was overruled by the referee and the hearing proceeded, each of the parties submitting evidence on the merits of the motion.
The errors assigned may be epitomized as
(1) The reference was in direct conflict with the plaintiff's constitutional rights, the same being in violation of Section 16, Article I of the Constitution of Ohio.
(2) That the judgment is contrary to law.
The constitutional provision referred to is that guaranteeing to all persons the right to due process of law in all matters of litigation. It is urged that in submitting this matter to the referee the court denied the plaintiff the right to a hearing under the due process clause. The right to a trial by jury appears to be the only preclusion of a compulsory reference of a matter pending in the courts. The question is not a jurisdictional matter, but one of procedure. Dillon v. City ofCleveland, 117 Ohio St. 258, 266, 158 N.E. 606; Toulmin, Jr.,
v. Becker, 94 Ohio App. 524, 115 N.E.2d 705. Section2315.26 of the Revised Code provides that any of the issues in an action or proceeding may be referred to a referee upon the consent of the parties. But when consent is not given, the court on its own motion may refer certain cases to a referee. Section2315.27 provides:
"When the parties do not consent to the reference mentioned in Section 2315.26 of the Revised Code, the court, or a *Page 148
judge thereof in vacation, upon the application of a party, or on its own motion, may direct a reference in any case in which the parties are not entitled by the Constitution to a trial by jury."
It will be noted that this section authorizes that a referee may be appointed "in any case in which the parties are not entitled by the Constitution to a trial by jury." Since this is a motion for a change of custody it may not be urged that the plaintiff was entitled to a trial by jury. Hence, the referral to a referee was in accordance with law. See 35 Ohio Jurisprudence, 104, Sections 7 and 8; 45 American Jurisprudence, 543, Section 5.
In considering whether the judgment was in accordance with law an examination of the record reveals that the referee made no written report of his findings of fact or conclusions of law. These appear to be required of a referee, for Section 2315.31 of the Revised Code provides:
"Referees must state the facts found, and conclusions of law, separately. Their decision must be given, and may be excepted to and reviewed, as in a trial by the court. Their report upon the whole issue shall stand as the decision of the court, and judgment may be entered thereon as if the court had tried the action."
Since no decision was given by the referee, the plaintiff was denied the right to except to the same and have it reviewed as in a trial by the court. It should also be noted that the statute provides that the decision of the referee shall stand as the decision of the court and judgment may be entered thereon the same as if the matter had been tried by the court. However, the court had no finding on which to base its judgment, hence it is not in accordance with law.
The identical question presented by this assignment of error was considered by the court in the case of DeVille v.DeVille, 87 Ohio App. 220, 94 N.E.2d 474. Paragraph two of the syllabus thereof provides:
"2. Parties to a `special proceeding' involving the custody of a child are entitled to have a Juvenile Court referee certify his findings and recommendation to the court in writing, to have notice of the filing thereof and to the right to file exceptions thereto and a hearing thereon prior to the entry by the court of any order upon such findings and recommendation." *Page 149
The only difference between the cited case and the case at bar is that in the former the referee was appointed by a Judge of the Juvenile Court while in our case the appointment was made by a Judge of the Court of Common Pleas.
It is our conclusion that the court committed prejudicial error in entering the judgment, which will accordingly be, and the same hereby is, reversed, and the cause is remanded for further proceedings according to law.
Judgment reversed.
PETREE, P. J., and HORNBECK, J., concur.
HORNBECK, J., of the Second Appellate District, sitting by designation in the Tenth Appellate District. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/2171527/ | 478 Pa. 484 (1978)
387 A.2d 425
PHILADELPHIA NEWSPAPERS, INC., the Associated Press, Central States Publishing Inc., the Pennsylvania Newspaper Publishers Association, the Pennsylvania Society of Newspaper Editors, and the Society of Professional Journalists, Sigma Delta Chi, Greater Philadelphia Chapter, Petitioners,
v.
The Honorable Domenic D. JEROME, Judge of the Court of Common Pleas of Delaware County, Pennsylvania.
EQUITABLE PUBLISHING COMPANY, INC., the Society of Professional Journalists, Sigma Delta Chi, Greater Philadelphia Chapter, the Pennsylvania Newspaper Publishers Association and the Pennsylvania Society of Newspaper Editors, Petitioners,
v.
The Honorable Robert W. HONEYMAN, Judge of the Court of Common Pleas of Montgomery County, Pennsylvania.
MONTGOMERY PUBLISHING COMPANY, Petitioner,
v.
The Honorable Robert W. HONEYMAN, Judge of the Court of Common Pleas of Montgomery County, Pennsylvania.
MONTGOMERY PUBLISHING COMPANY, Petitioner,
v.
The Honorable Robert W. HONEYMAN, Judge of the Court of Common Pleas of Montgomery County, Pennsylvania.
EQUITABLE PUBLISHING COMPANY, INC., the Society of Professional Journalists, Sigma Delta Chi, Greater Philadelphia Chapter, the Pennsylvania Newspaper Publishers Association, and the Pennsylvania Society of Newspaper Editors, Petitioners,
v.
The Honorable Lawrence A. BROWN, Judge of the Court of Common Pleas of Montgomery County, Pennsylvania.
MONTGOMERY PUBLISHING COMPANY, Petitioner,
v.
The Honorable Lawrence A. BROWN, Judge of the Court of Common Pleas of Montgomery County, Pennsylvania.
Misc. Docket 21, No. 401 Misc. Docket 21, No. 406 Misc. Docket 21, No. 407 Misc. Docket 21.
Supreme Court of Pennsylvania.
April 28, 1978.
*485 *486 *487 *488 Kohn, Savett, Marion & Graf, David H. Marion, Samuel E. Klein, Philadelphia, for petitioners at No. 384.
Dechert, Price & Rhoads, Arthur E. Newbold, IV, Philadelphia, for petitioner at Nos. 399 and 406.
Morgan, Lewis & Bockius, Roberta S. Staats, Philadelphia, for petitioner at Nos. 400, 401 and 407.
*489 Jonathan Vipond, III, Philadelphia, for respondent at Nos. 384, 399, 400, 401, 406 and 407.
Richard A. Sprague, Philadelphia, for Commonwealth at No. 384.
A. Charles Peruto, Philadelphia, for defendant at No. 384.
William T. Nicholas, Dist. Atty., Ross Weiss, 1st Asst. Dist. Atty., Montgomery County, for Commonwealth at Nos. 399, 400, 401, 406 and 407.
Vincent J. Fumo, Philadelphia, for defendant at Nos. 399, 400 and 401.
Joseph C. Santaguida, Philadelphia, for defendant at Nos. 406 and 407.
Robert P. Kane, Atty. Gen., for Commonwealth at No. 406.
OPINION OF THE COURT
ROBERTS, Justice.
Petitioner newspapers[1] filed in this Court petitions for writs of mandamus and prohibition and for extraordinary *490 relief, challenging the constitutionality of orders issued by respondent judges, upon the request of defendants in three criminal proceedings, pursuant to the Pennsylvania Rules of Criminal Procedure.[2] Petitioners contended that these orders, limiting public access to pre-trial hearings on motions to suppress evidence, denied their right of access to judicial proceedings. We concluded that petitioners failed to demonstrate that the orders denied them clear rights and therefore denied the petitions.
I. Procedural History
In Commonwealth v. Boyle, Nos. 650-A, 650-B, and 650-C, Washington County, March Session, 1974, the defendant Boyle was accused of ordering the death of United Mineworkers union official Joseph Yablonski, a crime which received massive national publicity. On January 24, 1974, we granted Boyle's request to change venue from Washington County because of extensive publicity concerning the crime.[3] In Commonwealth v. Palmer, No. 149-77, Montgomery County, the defendant, a police officer, was accused of kidnapping and killing a Montgomery County citizen. Petitioner *491 Equitable Publishing averred in its petition that the proceedings were "of the highest public interest and concern in Montgomery County."[4] In Commonwealth v. Phillips, No. 5060-76, Montgomery County, the defendant was accused of murdering a Montgomery County police officer. Equitable Publishing characterized these proceedings as attracting similar public interest.
Each defendant filed a pre-trial motion to suppress evidence in accordance with the Pennsylvania Rules of Criminal Procedure, Pa.R.Crim.P. 323(a), providing for a pre-trial hearing to determine the admissibility of evidence defendants claim has been obtained in violation of their constitutional rights.[5] Each defendant requested the trial court to exercise its authority, pursuant to Pa.R.Crim.P. 323(f), 323(g), 326, and 327,[6] to enter special orders closing the pre-trial hearing to the public, sealing the record of these pre-trial proceedings, and prohibiting participants in these proceedings from discussing, disclosing, or disseminating evidence "the admissibility of which may have to be determined by the Court." Respondent Judge Jerome entered the requested order in Boyle.[7] Respondents Judges Honeyman *492 and Brown entered the requested orders in Palmer and Phillips, respectively.[8]
On May 3, 1977, one day after pre-trial suppression proceedings in Commonwealth v. Boyle began, Philadelphia Newspapers filed a petition to vacate the orders of respondent Judge Jerome, and a request to stay the pre-trial proceedings. Judge Jerome declined to rule on the petition to vacate the orders until completion of the pre-trial proceedings and refused the stay. One day later, Philadelphia Newspapers filed in this Court its petitions for writs of mandamus and prohibition and for extraordinary relief, requesting this Court to direct Judge Jerome to hold the suppression hearing open to the public and provide other appropriate relief, including a stay of all proceedings. On May 9, 1977, Judge Jerome again declined to rule on the petition, believing he lacked jurisdiction over the controversy *493 once petitioner sought special relief in this Court. On May 23, 1977, we denied the requested relief.
Equitable Publishing, on May 12, 1977, filed with the trial court a motion to vacate the orders of Judge Honeyman in Commonwealth v. Palmer. Judge Honeyman did not act upon the motion until May 24. Judge Honeyman denied the motion on the basis that the newspapers were without standing to intervene in the criminal proceedings. On May 26, Equitable Publishing filed its petitions for special relief in this Court, requesting the same relief as Philadelphia Newspapers did from the orders in Commonwealth v. Boyle.[9] Equitable Publishing averred here that the suppression hearing record had been unavailable only until May 20, 1977, when Palmer's trial ended.[10] We denied relief on June 20, 1977.
On May 12, 1977, Equitable Publishing filed a motion to vacate the orders of Judge Brown in Commonwealth v. Phillips. Judge Brown did not rule upon the motion until June 2, 1977, when he dismissed the motions for the same reason as Judge Honeyman. Equitable Publishing filed its petitions for special relief in this Court on June 7, requesting the same relief it sought from the orders in Commonwealth v. Palmer. On June 20, 1977, we denied relief.
Petitioners appealed from the orders of this Court to the Supreme Court of the United States. On January 9, 1978, 434 U.S. 241, 98 S. Ct. 546, 54 L. Ed. 2d 506, the Court, per curiam, concluded that the record did not indicate whether we "passed on [petitioners'] federal claims" or whether we denied special relief "on an adequate and independent state ground." The Court therefore vacated our orders denying special relief and "remand[ed] the cause to [this C]ourt for such further proceedings as [we] may deem appropriate to *494 clarify the record. See California v. Krivda, 409 U.S. 33, [93 S. Ct. 32, 34 L. Ed. 2d 45] (1972)." Mr. Justice Rehnquist, joined by Mr. Justice Stevens, filed a dissenting opinion. On February 9, 1978, this Court received the official mandate of the Supreme Court. Accordingly, we file this opinion.
II. State Remedies Requested by Petitioner Newspapers
Petitioners sought writs of prohibition and mandamus from this Court.[11] Prohibition and mandamus both *495 require a party seeking relief to establish a violation of clear rights not remediable by ordinary processes. This requirement ensures that only the most meritorious claims will require this Court to depart from its normal appellate function and consider an original proceeding. Petitioners failed to establish their entitlement to these extraordinary remedies because they did not present a showing that the orders of respondents, entered pursuant to the Pennsylvania Rules of Criminal Procedure, denied clear rights of petitioners. We therefore denied the petitions.
We first discuss the nature of Pa.R.Crim.P. 323(f) & (g), 326, and 327, pursuant to which the challenged orders were issued. We then discuss petitioners' asserted right of access to pre-trial judicial proceedings and the circumstances in which this right may be temporarily limited in order to protect constitutional rights of individuals and important interests of the public. We next discuss the nature of the right of defendants to trial by an impartial jury and the interest of the Commonwealth and its citizens in the prompt and fair disposition of criminal litigation, both of which are protected by Rules 323, 326, and 327. Finally, we set forth why on these records the Rules of Criminal Procedure may permissibly be applied in these cases to enforce constitutional rights of the accused and promote public interests.
III. The Pennsylvania Rules of Criminal Procedure and Their Objectives
The Pennsylvania Rules of Criminal Procedure "are intended to provide for the just determination of every criminal proceeding," Pa.R.Crim.P. 2, and "secure simplicity in procedure, fairness in administration and the elimination of unjustified expense and delay . . . ." Id. This comprehensive set of statewide Rules assists in the fair, prompt, *496 orderly, and uniform resolution of recurring problems in the administration of our state system of criminal justice.[12]
The Rules upon which the challenged orders were based serve an important function in this scheme by avoiding premature disclosure of information which would jeopardize the right of an accused to an impartial jury. Pa.R.Crim.P. 323(f) & (g) provides:
"Suppression of Evidence
* * * * * *
(f) The hearing, either before or at trial, shall be held in open court unless defendant moves that it be held in the presence of only the defendant, counsel for the parties, court officers and necessary witnesses. If the hearing is held after the jury has been sworn, it shall be held outside the hearing and presence of the jury. In all cases the court may make such order concerning publicity of the proceedings as it deems appropriate under Rules 326 and 327.
(g) A record shall be made of all evidence adduced at the hearing. The clerk of court shall impound the record and the nature and purpose of the hearing and the order disposing of the motion shall not be disclosed by anyone to anyone except to the defendant and counsel for the parties. The record shall remain thus impounded unless the interests of justice require its disclosure.
Pa.R.Crim.P. 326 provides:
"Special Orders Governing Widely-Publicized Or Sensational Cases
*497 In a widely-publicized or sensational case, the Court, on motion of either party or on its own motion, may issue a special order governing such matters as extrajudicial statements by parties and witnesses likely to interfere with the rights of the accused to a fair trial by an impartial jury, the seating and conduct in the courtroom of spectators and news media representatives, the management and sequestration of jurors and witnesses, and any other matters which the Court may deem appropriate for inclusion in such an order. In such cases it may be appropriate for the court to consult with representatives of the news media concerning the issuance of such a special order."
Pa.R.Crim.P. 327 provides:
"Public Discussion of Pending Or Imminent Criminal Litigation By Court Personnel
All court personnel including, among others, court clerks, bailiffs, tipstaffs and court stenographers are prohibited from disclosing to any person, without authorization by the court, information relating to a pending criminal case that is not part of the public records of the court. This rule specifically prohibits the divulgence of information concerning arguments and hearings held in chambers or otherwise outside the presence of the public."
At a suppression hearing, the accused challenges the admissibility of inculpatory statements, alleged instruments of crime and alleged fruits of crime on grounds that the Commonwealth has obtained such evidence through violation of constitutional or other rights of the accused. Commonwealth witnesses, including police officers, may testify about the crime, and the involvement and behavior of the accused, or his prior criminal record. The accused may choose to testify or present witnesses to challenge the Commonwealth's evidence. Thus, Rules 323, 326 and 327 provide the trial court with a method for avoiding pre-trial exposure of potential jurors to evidence challenged at suppression hearings, thus eliminating a substantial impediment to selection of an unbiased jury.
*498 These Rules also ensure that a defendant's right to have unconstitutionally seized evidence suppressed will not be chilled by fear that information becoming public at a suppression hearing will make an impartial jury difficult or impossible to select. Cf. United States v. Jackson, 390 U.S. 570, 88 S. Ct. 1209, 20 L. Ed. 2d 138 (1968) (government may not use fear of death penalty to dissuade defendant from asserting right to jury trial); Garrity v. New Jersey, 385 U.S. 493, 87 S. Ct. 616, 17 L. Ed. 2d 562 (1967) (prosecution cannot use statements obtained from policemen threatened with discharge if they refused to testify); see generally Sheppard v. Maxwell, 384 U.S. 333, 86 S. Ct. 1507, 16 L. Ed. 2d 600 (1966).[13]
These Rules are designed to promote the clear public interest in having persons accused of crime tried fairly, expeditiously, economically, and only once. If prejudicial publicity occurs, the trial court may have to continue the case, change venue, resort to extensive voir dire to assure that the attitudes of jurors have not been influenced by disclosure, or use the costly and inconvenient device of jury sequestration. See Simmons v. United States, 390 U.S. 377, 88 S. Ct. 967, 19 L. Ed. 2d 1247 (1968); Jackson v. Denno, 378 U.S. 368, 84 S. Ct. 1774, 12 L. Ed. 2d 908 (1964). If the trial court takes inadequate remedial measures, an appellate court would be compelled to reverse a conviction, starting the trial process anew.
Essential to the stability and efficiency of our state court system is the requirement that our trial courts control court calendars. See ABA Project on Standards For Criminal Justice, Standards Relating to The Function of The Trial *499 Judge § 3.8 (Approved Draft, 1972); Standards Relating to Speedy Trial Part I (Approved Draft, 1968). Without Rules 323, 326 and 327, the time and place for trial in this kind of case would in reality be fixed not by courts, but by the timing and degree of premature disclosures of information from suppression hearings. Thus, the Rules, temporarily precluding disclosure of such information wherever necessary, maintain in the courts control over court calendars, assuring uniformity and evenhanded enforcement of criminal justice.
IV. Free Press and The Limited Right of Access to Pre-Trial Suppression Hearings
Petitioners argued that the Constitutions of the United States and Pennsylvania afford the public a right to have open judicial proceedings, including pre-trial motions to suppress. They contended that respondents' orders denied them this right.
Petitioners incorrectly characterize respondents' orders limiting public access to pre-trial suppression hearings deciding the admissibility of evidence in criminal proceedings as "prior restraints." A prior restraint prevents publication of information or material in the possession of the press and is presumed unconstitutional. See Oklahoma Publishing Co. v. District Court, 430 U.S. 308, 97 S. Ct. 1045, 51 L. Ed. 2d 355 (1977) (when press obtained name and photo of juvenile, court could not prohibit publication); Nebraska Press Ass'n v. Stuart, 427 U.S. 539, 96 S. Ct. 2791, 49 L. Ed. 2d 683 (1976) (striking down order prohibiting publication of inculpatory statements and facts obtained by press).[14] These orders, however, issued in compliance with the Rules of Criminal Procedure, did not prevent petitioners from publishing any information in their possession or from writing *500 whatever they pleased and therefore did not constitute a prior restraint upon publication.[15]
The distinction between restraints upon the content of publication and limitations upon access is well established. For example, in Pell v. Procunier, 417 U.S. 817, 94 S. Ct. 2800, 41 L. Ed. 2d 495 (1974), the Court upheld prison regulations restricting press interviews with prisoners, but noted that the regulations did not prohibit publication of any material the press obtained. By contrast, in New York Times Co. v. United States, 403 U.S. 713, 91 S. Ct. 2140, 29 L. Ed. 2d 822 (1971), the Court prohibited the government from enjoining publication of military documents in the hands of the press, but did not suggest that the government lacked the right to restrict access to them by classification.[16]
The Supreme Court of the United States has held that restrictions may be placed upon access of the public and the press to certain information when the restrictions protect constitutional interests. McMullan v. Wohlgemuth, 415 U.S. 970, 94 S. Ct. 1547, 39 L. Ed. 2d 863 (1974), dismissing for want of a substantial federal question, 453 Pa. 147, 308 A.2d 888 (1973) (press access properly restricted by state regulations protecting privacy of welfare recipients); see Sunbeam Television Corp. v. Shevin, ___ U.S. ___, 98 S. Ct. 1480, 55 L. Ed. 2d 513 (1978), dismissing for want of a substantial federal question, 351 So. 2d 723 (Fla. 1977) (upholding state law forbidding reporters from invading privacy by secretly taping interviews).[17] This rule applies *501 the principle that government may, when necessary, protect personal liberties even where enforcement of those liberties may subordinate in limited instances the constitutional interests of others. For example, in Runyon v. McCrary, 427 U.S. 160, 96 S. Ct. 2586, 49 L. Ed. 2d 415 (1976), the Supreme Court held that the 13th and 14th amendments empowered Congress to require private schools to desegregate even though desegregation deprived some citizens of the ability to associate for education in the manner they chose. Similarly, in Walz v. Tax Commission, 397 U.S. 664, 90 S. Ct. 1409, 25 L. Ed. 2d 697 (1970), the Court upheld tax exemptions for religious institutions as promoting freedom of religion despite the claim that the exemptions violated the establishment clause. Likewise, the state may recognize property interests in intellectual or artistic creations by prohibiting their publication or broadcast without permission. See Copyright Act, 17 U.S.C. §§ 101 et seq.; Zacchini v. Scripps-Howard Broadcasting Co., 433 U.S. 562, 575-576, 97 S. Ct. 2849, 2857, 53 L. Ed. 2d 965 (1977) (citing cases).
The public undoubtedly has a strong interest in the judicial process. "A trial is a public event. What transpires in the court room is public property." Craig v. Harney, 331 U.S. 367, 374, 67 S. Ct. 1249, 1254, 91 L. Ed. 1546 (1947); see In re Oliver, 333 U.S. 257, 68 S. Ct. 499, 92 L. Ed. 682 (1948) (need for public trial to protect defendant). The Supreme *502 Court of the United States has suggested that the public's interest in judicial proceedings is constitutionally protected by the sixth amendment right of the accused to a public trial. Singer v. United States, 380 U.S. 24, 85 S. Ct. 783, 13 L. Ed. 2d 630 (1965) (dictum); see United States v. Cianfrani, 573 F.2d 835 (3d Cir., filed March 16, 1978); Pa.Const. art. I, § 11.[18] The press serves the important function of informing the public of these public proceedings. Sheppard v. Maxwell, supra; see generally ABA Minimum Standards for Criminal Justice, Standards Relating to Fair Trial and Free Press (Approved Draft, 1968).[19]
But the Supreme Court has never held that the first or sixth amendments create an absolute right of access to every court proceeding or to all information in the possession of the government or the courts. See Nebraska Press Ass'n v. Stuart, supra; Pell v. Procunier, supra; Branzburg v. Hayes, 408 U.S. 665, 92 S. Ct. 2646, 33 L. Ed. 2d 626 (1972). Both the Nebraska Press majority and the concurring opinion of Mr. Justice Brennan recognize that restrictions on access to pre-trial proceedings are different from restraints on the right to publish information available to the public. Supra, 427 U.S. at 564 n. 8, 599-603 & 601 n. 27, 96 S. Ct. at 2805 n. 8, 2822-23 & 2823 n. 27; see Sheppard v. Maxwell, 384 U.S. 333, 360-61, 86 S. Ct. 1507, 1521, 16 L. Ed. 2d 600 (1966) (suggesting restraints on access to prevent prejudicial disclosure). *503 In Oklahoma Publishing, the Court emphasized that Nebraska Press was aimed only at eliminating prior restraints directly prohibiting publication of information and not at any other measures protecting fair trials.
We believe that any limitation on access should be carefully drawn. First, the right of access to court proceedings should not be limited for any reason less than the compelling state obligation to protect constitutional rights of criminal defendants and the public interest in the fair, orderly, prompt, and final disposition of criminal proceedings.[20] Second, access should not be limited unless the threat posed to the protected interest is serious.[21] Third, rules or orders limiting access should effectively prevent the harms at which they are aimed.[22] Finally, the rules or *504 orders should limit no more than is necessary to accomplish the end sought.[23] Because the challenged Rules and orders are closely tailored to protecting both the constitutional right of defendants to a fair trial and the public's interest in the fair and efficient administration of criminal justice, we denied relief.
V.
A. The Challenged Rules and Orders Advance The Public Interest In A Fair and Prompt Criminal Trial
The Rules and Orders petitioners challenge are designed to protect the right of an accused to trial by an impartial jury. No right is more fundamental to the American system of justice. U.S.Const. Amend. VI; Pa.Const. art. I, § 9; Gardner v. Florida, 430 U.S. 349, 97 S. Ct. 1197, 51 L. Ed. 2d 393 (1977); Nebraska Press Ass'n v. Stuart, supra; Ham v. South Carolina, 409 U.S. 524, 93 S. Ct. 848, 35 L. Ed. 2d 46 (1973); Peters v. Kiff, 407 U.S. 493, 92 S. Ct. 2163, 33 L. Ed. 2d 83 (1972); Duncan v. Louisiana, 391 U.S. 145, 88 S. Ct. 1444, 20 L. Ed. 2d 491 (1967); Turner v. Louisiana, 379 U.S. 466, 85 S. Ct. 546, 13 L. Ed. 2d 424 (1965).
Without a proper method for dealing with extensive publicity concerning a crime, a judicial system runs the serious risk that the jury will reach its verdict based on evidence from sources outside of the courtroom, contrary to the demands of due process. See Turner v. Louisiana, supra; *505 Irvin v. Dowd, 366 U.S. 717, 81 S. Ct. 1639, 6 L. Ed. 2d 751 (1961); Commonwealth v. Bruno, 466 Pa. 245, 352 A.2d 40 (1976); Commonwealth v. Pierce, 451 Pa. 190, 303 A.2d 209, cert. denied, 414 U.S. 878, 94 S. Ct. 164, 38 L. Ed. 2d 124 (1973).[24] As Justice Clark, speaking for the Court in Sheppard v. Maxwell, supra, 384 U.S. at 350-51, 86 S.Ct. at 1516, observed:
"`[L]egal trials are not like elections to be won through the use of the meeting-hall, the radio, and the newspaper.' Bridges v. California, 314 U.S. 252, 271, 62 S. Ct. 190, 197, 86 L. Ed. 192 (1941). And the Court has insisted that no one be punished for a crime without `a charge fairly made and fairly tried in a public tribunal free of prejudice, passion, excitement, and tyrannical power.' Chambers v. State of Florida, 309 U.S. 227, 236-37, 60 S. Ct. 472, 477, 84 L. Ed. 716 (1940). `Freedom of discussion should be given the widest range compatible with the essential requirement of the fair and orderly administration of justice.' Pennekamp v. State of Florida, 328 U.S. 331, 347, 66 S. Ct. 1029, 1037, 90 L. Ed. 1295 (1946). But it must not be allowed to divert the trial from the `very purpose of a court system . . . to adjudicate controversies, both criminal and civil, in the calmness and solemnity of the courtroom according to legal procedures.' Cox v. State of Louisiana, 379 U.S. 559, 583, 85 S. Ct. 466, 471, 13 L. Ed. 2d 487 (1965) (Black, J., dissenting). Among these `legal procedures' is the requirement that the jury's verdict be based on evidence received in open court, not from outside sources."
The most damaging of all information from outside the courtroom comes from the pre-trial suppression hearing. A trial court's ability to afford the accused a fair trial is substantially threatened where challenged inculpatory statements,[25]*506 testimony of the accused bearing on such statements,[26] or other information considered at the suppression hearing becomes public knowledge prematurely. See Rideau v. Louisiana, 373 U.S. 723, 83 S. Ct. 1417, 10 L. Ed. 2d 663 (1963) (trial court erred in denying change of venue where accused's statement to police had been televised repeatedly in the area from which the jurors were drawn); Commonwealth v. Bruno, supra (conviction reversed where trial court failed to question jurors concerning their exposure to publicized, suppressed confession); Commonwealth v. Pierce, supra (conviction reversed and venue changed where news accounts reported defendant's criminal record and confession to crime); see also Marshall v. United States, 360 U.S. 310, 79 S. Ct. 1171, 3 L. Ed. 2d 1250 (1959) (conviction reversed where jurors read newspaper accounts detailing defendant's criminal record); United States v. Williams, 568 F.2d 464 (5th Cir. filed February 27, 1978) (conviction reversed where jurors observed television broadcast concerning defendant's previous conviction). Our Rules are designed to give defendants such as Boyle, Palmer, and Phillips, all charged with murder for crimes generating substantial public attention, the opportunity to be tried, like any other persons accused of crime, on the basis of facts presented at trial.
Further, without proper means for temporarily limiting access to suppression hearings, defendants may be pressured into foregoing their right to challenge the manner in which police obtained inculpatory evidence. A defendant may feel compelled to give up this right out of fear that inculpatory evidence might become public knowledge before or during trial. Such pressure to forego a constitutional right denies due process. E.g., United States v. Jackson, 390 U.S. 570, 88 S. Ct. 1209, 20 L. Ed. 2d 138 (1968) (suspect denied due process by being required to waive jury trial to avoid death penalty). Even a defendant who chooses to risk such disclosure *507 might be reluctant to testify or present favorable witnesses out of a similar fear of disclosure. The Rules serve to avoid circumstances compelling an accused to forego these important rights.[27]
Prejudicial publicity from pre-trial suppression hearings injures the Commonwealth as well as the accused. Prejudicial disclosures may taint a trial or require a trial court to delay trial until publicity subsides. Neither delayed trials nor retrials present as favorable opportunities for establishing truth as timely first trials. By precluding prejudicial disclosures arising from pre-trial suppression hearings, the Rules promote the speedy and effective enforcement of the criminal laws, ensure swift convictions deterring crime, see A. von Hirsch, Doing Justice (1976), and avoid unnecessary expenditures of public funds and judicial resources.[28]
Significantly, the orders here challenged were requested by the defendants. Rule 323(f), upon which the orders were based, provides that only a defendant may request a closed suppression hearing to protect his constitutional rights. See Commonwealth v. Bennett, 445 Pa. 8, 11-12 n. 3, 282 A.2d 276, 278 n. 3 (1971), following United States ex rel. Bennett v. Rundle, 419 F.2d 599 (3rd Cir. 1969) (court's sua sponte closure of suppression hearing violated defendant's right to public trial). This provision denies the prosecution the power to prevent disclosure of information *508 concerning a criminal case, "gag" participants in the proceeding, or deprive an accused his right to open judicial proceedings. See note 8 supra (use of Rules 326 & 327).
Cases from federal courts of appeals demonstrate the importance of focusing on the defendant's protection of his constitutional rights. In Chase v. Robson, 435 F.2d 1059 (7th Cir. 1970), the seventh circuit invalidated an order opposed by the defendants forbidding the defendants and attorneys for both prosecution and defense from publicly commenting on the case. See In re Oliver, 452 F.2d 111 (7th Cir. 1971). The order in Chase also covered all information about the case, whereas the challenged orders here involve only pretrial suppression hearings, generating information most likely to be extremely prejudicial to the accused. See notes 7 & 8 supra. Similarly, in Central South Carolina Chapter v. Martin, 556 F.2d 706 (4th Cir. 1977), cert. denied, 434 U.S. 1022, 98 S. Ct. 749, 54 L. Ed. 2d 771 (1978), the fourth circuit, while it approved a ban on pre-trial discussion of prejudicial matters not of public record, specifically noted the defendant was free to seek a modification of the order as it affected him.
Here, respondents entered orders in murder cases of great notoriety. In Commonwealth v. Boyle, the defendant is a national figure, accused of a crime of widespread attention. Publicity in this case had already compelled this Court to grant a change of venue. In Commonwealth v. Palmer and Commonwealth v. Phillips, petitioners averred that the crimes were also of widespread interest in the community. Thus, the challenged orders were aimed at averting a substantial threat to both the fundamental rights of the defendants and the public interest in prompt and orderly administration of criminal justice.
B. The Orders Imposed Only a Limitation on Access to Pre-Trial Suppression Hearings, Carefully Designed to Protect Rights of The Accused and Interests of The Public
The orders here are limited to pre-trial suppression hearings, which involve materials likely to be prejudicial to *509 defendants. See supra notes 6-8 and accompanying text. In Central South Carolina Chapter v. Martin, supra, the fourth circuit demonstrated the significance of avoiding pre-trial disclosure of prejudicial information. The court invalidated parts of a pre-trial order prohibiting parties from mingling with the press on sidewalks adjacent to the courthouse and barring artists from sketching jurors, but upheld that part of the order prohibiting extrajudicial statements of participants "which might divulge prejudicial matter not of public record." In United States v. Gurney, 558 F.2d 1202 (5th Cir. 1977), cert. denied sub nom. Miami Publishing Co. v. Krentzman, ___ U.S. ___, 98 S. Ct. 1606, 56 L. Ed. 2d 59 (1978), the fifth circuit reaffirmed the well established rule that even during an open, public trial, a court may limit public access to sidebar and bench conferences. Cf. Tribe, supra note 18. The same jurisprudential considerations justifying the traditional sidebar rule support our Rules authorizing respondents' pre-trial suppression hearing orders. Here, as in Martin and Gurney, the orders of respondents carefully preserve the integrity of juror deliberations.
United States v. Cianfrani, 573 F.2d 835 (3d Cir. filed March 16, 1978), is not to the contrary. In Cianfrani, a panel of the third circuit modified part of a district court order closing a pre-trial hearing where the court determined the admissibility of intercepted statements and other evidence. After the pre-trial hearing, the defendant pleaded guilty. Thus, the panel was not presented with a case where such orders were necessary to preserve the defendant's right to a fair trial. Nor do we reach a conclusion contrary to CBS, Inc. v. Young, 522 F.2d 234 (6th Cir. 1975), where the sixth circuit invalidated an order forbidding all participants and witnesses from discussing with the press any aspect of a celebrated civil suit. This order was not entered to protect the constitutional rights of any party, and restricted access to all information concerning the case not public, rather than to specific information likely to impede a fair trial.
Further, all three trials have been completed, and the challenged orders may have expired. See Rule 323(g); note *510 10 supra and accompanying text. The statute in McMullan v. Wohlgemuth, supra, permanently prevented agents of the state from revealing to the press and the public names of any Pennsylvania welfare recipients. This statute, more restrictive than the orders here, was upheld by our Court and the Supreme Court of the United States against an access challenge. 415 U.S. 970, 94 S. Ct. 1547, 39 L. Ed. 2d 863 (1974), dismissing for want of a substantial federal question, 453 Pa. 147, 308 A.2d 888 (1973). Similarly, in Garrett v. Estelle, 556 F.2d 1274 (5th Cir. 1977), prison regulations permissibly denied newsmen the right to film executions for broadcast, depriving the public of certain information about these events. See Holden v. Minnesota, 137 U.S. 483, 11 S. Ct. 143, 34 L. Ed. 734 (1890) (upholding statute excluding reporters from scene of execution despite request by condemned man). The challenged orders imposed only a limitation on access to pre-trial suppression hearings, no greater than necessary to accomplish their purpose. Accord, United States v. Gurney, supra (upholding district court order limiting access to sidebar conferences).
Moreover, the Rules and orders here do not contain the inherent ambiguities and potential for chilling condemned in Nebraska Press. When the court closes a pre-trial suppression hearing, there are no injunctions forbidding publication or requiring the press to guess at what it may or may not print. Thus, the judgment of the newspaper editor remains unimpaired. Compare Nebraska Press Ass'n v. Stuart, supra (certain information arguably, but not certainly, included in prohibition against publication), and Miami Herald Publishing Co. v. Tornillo, 418 U.S. 241, 256-57, 94 S. Ct. 2831, 2839, 41 L. Ed. 2d 730 (1974) ("right of reply" statute impermissibly infringed on editor's discretion), with Pittsburgh Press Co. v. Pittsburgh Human Relations Commission, 413 U.S. 376, 93 S. Ct. 2553, 37 L. Ed. 2d 669 (1973) (upholding prohibition against sex-classified advertising where discriminatory hiring was unlawful and editor could easily determine from face of advertisement if it was forbidden), and Pell v. Procunier, supra (editors not forbidden to print any information gathered in prison).
*511 C. No Other State Procedural Device Eliminates Prejudicial Disclosure
Courts in the past have attempted to deal with prejudicial disclosure by lengthy voir dire of potential jurors, extensive continuances, burdensome sequestration, and cautionary instructions. Because these techniques do not eliminate prejudicial disclosure, but only may reduce some of its effects, all have proven unsatisfactory in many cases. Only one other method, change of venue, may in some cases put a case beyond the physical range of disclosure, but it may not be effective in cases of statewide or national attention, such as Commonwealth v. Boyle, or Estes v. Texas, 381 U.S. 532, 85 S. Ct. 1628, 14 L. Ed. 2d 543 (1965). Further, pre-trial publicity may follow a case to its new venue.
Through voir dire, a court attempts to minimize the effect of pre-trial publicity by excluding from the jury those whom publicity has biased. But it cannot hope to eliminate all jurors who have been exposed to prejudicial information. In a highly publicized case, effective voir dire may distort the composition of the jury by screening out all those who take an active interest in news and public affairs. Neither a defendant nor the Commonwealth has an interest in seating such a jury. Other methods of dealing with prejudicial disclosure, such as sequestration, continuances, or cautionary instructions to the jury, do not realistically reduce premature prejudicial disclosure to which a jury is exposed.
Finally, many of the methods for eliminating the effects of prejudicial disclosure have other drawbacks. A continuance allows evidence to become stale and lengthens the period during which charges remain unresolved and the accused confined or held on bail pending disposition of the charges. Cf. Gerstein v. Pugh, 420 U.S. 103, 114, 95 S. Ct. 854, 863, 43 L. Ed. 2d 54 (1975) (restraints on liberty caused by prolonged detention). Changes of venue and sequestration pose further problems of administration for courts and inconvenience for all persons connected with a case.
A rule of general application directly meeting the problem of prejudicial disclosure is indeed an appropriate *512 procedural device for the administration of a state court system of criminal justice. The Rules and orders challenged here meet that need by temporarily limiting access to pretrial proceedings most likely to involve prejudicial material which, if disclosed, could deprive the defendant of a fair trial and impose unneeded burdens on the public and the judicial system. The challenged orders protected the defendants from disclosure by attorneys and witnesses participating in suppression hearings under Rule 323. Such disclosures can be just as prejudicial as public exposure of the proceedings.[29] Short of gagging the press, which is presumed to be unconstitutional, Oklahoma Publishing Co. v. District Court, supra; Nebraska Press Ass'n v. Stuart, supra, or permanently depriving the press access to all information about a case, we believe our Rules and these orders are the most effective means of reducing premature prejudicial disclosure.
*513 VI. Conclusion
This Court is fully aware of the great societal benefits our citizenry derives from access to all open court proceedings. Manifestly, that freedom has and continues to contribute significantly to the attainment of the effective administration of justice.
We must also be mindful of the Commonwealth's obligation to protect the right of the accused to a constitutionally required fair and speedy trial. Similarly, it must be recognized that the Commonwealth entertains a traditionally strong interest in protecting the fairness and integrity of criminal convictions obtained in its court system.
Adequate consideration must also be accorded the very pronounced public interest in having its system of criminal justice function so that jury trials are conducted promptly, fairly, and with finality. Due recognition must be given rules and procedures designed to achieve prompt and fair trials without the hazards of imposing on the state court system unnecessary and avoidable burdens such as retrials and extended trial delays. This is the true mission of the Rules of Criminal Procedure.
Experience has plainly demonstrated that premature disclosure of pre-trial suppression material creates a heavy and unnecessary burden upon the judicial process and adversely affects these public interests. Rules 323, 326 and 327 authorize a court in an appropriate case, if necessary, to limit or postpone access to pre-trial suppression hearing material so that the case may proceed in an orderly and timely fashion in an atmosphere free from the hazards and prejudice which may be engendered by the premature disclosure of suppression material, the admissibility of which is yet to be judicially determined. It must be concluded here that the public interest in avoiding unfair and delayed trials and retrials outweighed the postponement of petitioners' access.
We concluded on the record as presented by petitioners that respondents' orders, which limited access to pre-trial *514 suppression hearings in murder cases which had received great public attention, did not deny petitioners any clear legal right. We therefore denied petitioners the state remedies they sought. See Central South Carolina Chapter v. Martin, supra; United States v. Gurney, supra; but see State ex rel. Dayton Newspapers, Inc. v. Phillips, 46 Ohio St. 2d 457, 351 N.E.2d 127 (1976). These orders were entered pursuant to the Pennsylvania Rules of Criminal Procedure, a set of state rules designed to administer criminal justice fairly and efficiently. The orders were closely tailored to meet the problems of prejudicial disclosure resulting from suppression hearings.
Accordingly, special relief was properly denied petitioners and our orders are reinstated in conformity with this opinion.
PACKEL, J., did not participate in the consideration of this opinion.
NOTES
[1] Petitioner newspapers include Philadelphia Newspapers, Inc., The Associated Press, Central States Publishing, Inc., The Pennsylvania Newspaper Publishers Association, The Pennsylvania Society of Newspaper Editors, and The Society of Professional Journalists, Sigma Delta Chi, Greater Philadelphia Chapter (collectively referred to as "Philadelphia Newspapers"); Equitable Publishing Company, Inc., The Society of Professional Journalists, Sigma Delta Chi, Greater Philadelphia Chapter, The Pennsylvania Newspaper Publishers Association, and The Pennsylvania Society of Newspaper Editors and Montgomery Publishing Company (collectively referred to as "Equitable Publishing").
Respondent judges include: The Honorable Domenic D. Jerome, Court of Common Pleas of Delaware County and the presiding judge over pre-trial motions in Commonwealth v. Boyle, Nos. 650-A, 650-B, and 650-C, Washington County, March Session, 1974; The Honorable Robert W. Honeyman, Court of Common Pleas of Montgomery County and presiding judge over pre-trial motions in Commonwealth v. Palmer, No. 149-77, Montgomery County; and The Honorable Lawrence A. Brown, Court of Common Pleas of Montgomery County and presiding judge over pre-trial motions in Commonwealth v. Phillips, No. 5060-76, Montgomery County. Philadelphia Newspapers challenged the orders of Judge Jerome; Equitable Publishing challenged the orders of Judges Honeyman and Brown.
[2] We considered the petitions pursuant to the Appellate Court Jurisdiction Act of 1970, Act of July 31, 1970, P.L. 673, art. II, §§ 201(2) and 205, 17 P.S. §§ 211.201(2) and 211.205 (Supp. 1977). Section 201(2) provides:
"Original jurisdiction
The Supreme Court shall have original but not exclusive jurisdiction of:
.....
(2) All cases of mandamus or prohibition to courts of inferior jurisdiction . . .."
Section 205 provides:
"Extraordinary jurisdiction
Notwithstanding any other provisions of law, The Supreme Court may, on its own motion or upon petition of any party, in any matter pending before any court or justice of the peace of this Commonwealth involving an issue of immediate public importance, assume plenary jurisdiction of such matter at any stage thereof and enter a final order or otherwise cause right and justice to be done."
[3] This Court reversed Boyle's earlier conviction because he was denied an opportunity to present exculpatory evidence. Commonwealth v. Boyle, 470 Pa. 343, 368 A.2d 661 (1977).
[4] In acting upon these petitions, we accepted these averments as true. See Allstate Insurance Co. v. Fioravanti, 451 Pa. 108, 299 A.2d 585 (1973).
[5] Pa.R.Crim.P. 323(a) provides:
"Suppression of Evidence
(a) The defendant or his attorney may make a motion to the court to suppress any evidence alleged to have been obtained in violation of the defendant's [constitutional] rights."
[6] See infra text at Part III, at 430-431.
[7] Upon filing applications to suppress evidence pursuant to Rule 323(a), defendant Boyle moved to close the suppression hearings under Rule 323(f) & (g) and under 326 and 327 to limit public comment by parties, witnesses and attorneys on the evidence sought to be suppressed.
Philadelphia Newspapers averred that on March 28, 1977 the court prohibited "parties, attorneys, investigators, judicial officers, state and federal public officials, and prospective witnesses from discussing or commenting upon any proposed evidence or disseminating any documents, the admissibility of which may have to be determined by the Court;" on May 2, 1977, directed the press and public out of the courtroom while pre-trial motions were heard; and ordered sealed all papers related to the pre-trial proceedings.
Where a defendant moves to close a suppression hearing and to restrain participants from public comment thereon, an order such as this one prohibiting participants from "discussing or commenting upon any proposed evidence or disseminating any documents, the admissibility of which may have to be determined by the Court" is the proper order to enter under Rules 326 and 327.
[8] Equitable Publishing averred that on May 2, 1977, the court prohibited "parties, attorneys, police officers, court personnel, prison personnel, and personnel of the sheriff's office from discussing or commenting about [Commonwealth v. Palmer]"; directed the press and public out of the courtroom during pre-trial proceedings; and sealed the record of these proceedings.
Equitable Publishing also averred that on May 9, 1977, the court prohibited "parties, attorneys, police officers, court personnel, prison personnel, personnel of the sheriff's office, and prospective witnesses" from making or authorizing statements out of court relating to Commonwealth v. Phillips. Equitable Publishing also averred that Judge Brown ordered the press and public out of the courtroom, and directed that the record and proceedings be sealed.
On the record presented here, we believe that the orders in Palmer and Phillips had essentially the same scope as the order in Boyle, supra note 7.
Respondents invoked Rules 326 and 327 only to ensure that parties to suppression hearings closed under 323 would not release pre-trial prejudicial information. We therefore were not faced with a case in which Rules 326 and 327 were used for any other purpose.
[9] Equitable Publishing and Montgomery Publishing did not expressly request this Court to stay the pre-trial proceedings in Commonwealth v. Palmer.
[10] See United States v. Cianfrani, 573 F.2d 835 (3d Cir., filed March 16, 1978) (tapes defendant sought to suppress must be made public after defendant has pleaded guilty); Pa.R.Crim.P. 323(g).
[11] Prohibition is an extraordinary writ designed to assure regularity in judicial proceedings by preventing unlawful exercise or abuse of jurisdiction. In re Reyes, 476 Pa. 59, 381 A.2d 865 (1977); Pirillo v. Takiff, 462 Pa. 511, 341 A.2d 896 (1975); Carpentertown Coal and Coke Co. v. Laird, 360 Pa. 94, 61 A.2d 426 (1948); McNair's Petition, 324 Pa. 48, 187 A. 498 (1936). "Its function is to restrain or prohibit an offending court from continuing its unwarranted conduct when continuation threatens imminent harm to the individual on whose behalf the writ is issued." Comment, "The Writ of Prohibition in Pennsylvania," 80 Dick.L.Rev. 472, 472-73 (1976) (footnotes omitted).
While prohibition prevents action, mandamus compels it. Carpentertown Coal and Coke Co. v. Laird, supra. Like prohibition, mandamus is an extraordinary writ of the common law, designed to compel performance of a ministerial act or mandatory duty where there exists a clear legal right in the plaintiff, a corresponding duty in the defendant, and want of any other adequate and appropriate remedy. Princeton Sportswear Corp. v. Redevelopment Authority, 460 Pa. 274, 333 A.2d 473 (1975); Valley Forge Racing Ass'n v. State Horse Racing Comm'n, 449 Pa. 292, 297 A.2d 823 (1972). A court issuing a writ of mandamus may direct the exercise of discretion, but not performance of a particular discretionary act. Taylor v. Abernathy, 422 Pa. 629, 222 A.2d 863 (1966); Mellinger v. Kuhn, 388 Pa. 83, 130 A.2d 154 (1957).
Petitioners also requested this Court to invoke its extraordinary jurisdiction because of the asserted immediate public importance of the issues. See supra note 2; Wilson v. Blake, 475 Pa. 627, 381 A.2d 450 (1977) (plenary jurisdiction exercised to determine right of criminal defendant under Pa.R.Crim.P. 141(c)(4) to make tape recording of preliminary hearing); Citizens Committee v. Board of Elections, 470 Pa. 1, 367 A.2d 232 (1976) (plenary jurisdiction invoked to decide constitutionality of procedures by which Mayor of Philadelphia was to be recalled from office). The presence of an issue of immediate public importance is not alone sufficient to justify extraordinary relief. As in requests for writs of prohibition and mandamus, we will not invoke extraordinary jurisdiction unless the record clearly demonstrates a petitioner's rights. Even a clear showing that a petitioner is aggrieved does not assure that this Court will exercise its discretion to grant the requested relief. See Illinois v. City of Milwaukee, 406 U.S. 91, 92 S. Ct. 1385, 31 L. Ed. 2d 712 (1972).
[12] Our Rules of Criminal Procedure are a system designed to give effective protection to the rights of defendants and maintain the integrity and stability of our state system of criminal justice. For example, Pa.R.Crim.P. 1100 protects the guarantee of a speedy trial by requiring, subject to carefully drawn exceptions, that an accused be brought to trial within 180 days of the initiation of criminal proceedings against him. Compare Barker v. Wingo, 407 U.S. 514, 92 S. Ct. 2182, 33 L. Ed. 2d 101 (1972) (providing for ad hoc approach to speedy trial claims). See also, e.g., Pa.R.Crim.P. 319 (ensuring knowing and voluntary pleas of guilty); Pa.R.Crim.P. 1101 (knowing and voluntary waiver of right to trial by jury).
[13] The Supreme Court in Sheppard v. Maxwell, 384 U.S. 333, 86 S. Ct. 1507, 16 L. Ed. 2d 600 (1966), found that the "carnival atmosphere" resulting from press coverage of the crime and the trial denied the accused a fair trial. Concluding that such an atmosphere "could easily have been avoided since the courtroom and [the] courthouse premises are subject to the control of the court," id. at 358, 86 S.Ct. at 1520, the Court imposed a duty upon courts to ensure that an accused is tried by a jury not subjected to prejudicial information. Our Rules of Criminal Procedure are in harmony with the principles announced in Sheppard.
[14] Accord, New York Times Co. v. United States, 403 U.S. 713, 91 S. Ct. 2140, 29 L. Ed. 2d 822 (1971) (government could not enjoin publication of secret documents allegedly imperilling national security obtained by press clandestinely); Near v. Minnesota, 283 U.S. 697, 51 S. Ct. 625, 75 L. Ed. 1357 (1931) (state may not enjoin publication of "scurrilous" anti-semitic material held by press).
[15] Respondents had no authority to impose sanctions on petitioners after publication of any confidential material they might obtain, nor did they attempt to do so. Cf. Cox Broadcasting Co. v. Cohn, 420 U.S. 469, 95 S. Ct. 1029, 43 L. Ed. 2d 328 (1975) (invalidating civil penalties for publication of public judicial records).
[16] The basis of the distinction may be that direct restraints upon expression impose restrictions on human thought and strike at the core of liberty in a way which limitations on access to information do not. See generally Emerson, The System of Freedom of Expression (1970).
[17] See generally, Comment, Rights of the Public and the Press to Gather Information, 87 Harv.L.Rev. 1505 (1974); Note, The First Amendment and the Public Right to Information, 35 U.Pitt.L.Rev. 93 (1973); Comment, Right of the Press to Gather Information, 71 Colum.L.Rev. 838 (1971).
The Supreme Court has also held that certain valid governmental interests may be promoted by limiting public access to sources of information. Pell v. Procunier, 417 U.S. 817, 94 S. Ct. 2800, 41 L. Ed. 2d 495 (1974) (prison regulations may prohibit interviews with particular prisoners); Zemel v. Rusk, 381 U.S. 1, 85 S. Ct. 1271, 14 L. Ed. 2d 179 (1965) (State Department may restrict reporters' foreign travel); Holden v. Minnesota, 137 U.S. 483, 491, 11 S. Ct. 143, 146, 34 L. Ed. 734 (1890) (per Harian, J.) (statute upheld excluding reporters from scene of execution despite request by condemned man); accord, McLaughlin v. Philadelphia Newspapers, Inc., 465 Pa. 104, 348 A.2d 376 (1975) (records of attorney disciplinary hearing may be closed); Philadelphia Newspapers, Inc. v. Disciplinary Board, 468 Pa. 382, 363 A.2d 779 (1976); see generally, L. Tribe, American Constitutional Law §§ 12-11, 12 19 (1978).
[18] A few federal courts of appeals have allowed certain parts of trials to be kept secret. L. Tribe, American Constitutional Law § 12-11 at 629 n. 28 (citing cases). Similarly, courts-martial operate under rules different from those governing civilian trials. See generally Middendorf v. Henry, 425 U.S. 25, 96 S. Ct. 1281, 47 L. Ed. 2d 556 (1976).
[19] A few courts have held that the Constitution grants the press access to judicial proceedings. See CBS, Inc. v. Young, 522 F.2d 234, 239 (6th Cir. 1975) (civil trial); State ex rel. Dayton Newspapers, Inc. v. Phillips, 46 Ohio St. 2d 457, 351 N.E.2d 127 (1976) (suppression hearings); see also United States v. Cianfrani, 573 F.2d 835 (3d Cir., filed March 16. 1978) (panel) (modifying part of district court order closing pre-trial proceedings where defendant challenged admissibility of intercepted statements; court pointed out that, because defendant pleaded guilty following hearing, case did not present fair trial issue).
[20] Compare Central South Carolina Chapter v. Martin, 556 F.2d 706 (4th Cir. 1977), cert. denied, 434 U.S. 1022, 98 S. Ct. 749, 54 L. Ed. 2d 771 (1978) (participants may be ordered not to discuss proceedings in order to protect defendant's right to fair trial), and Gannett Co. v. DePasquale, 43 N.Y.2d 370, 401 N.Y.S.2d 756, 372 N.E.2d 544 (N.Y. filed December 19, 1977), cert. granted, ___ U.S. ___, ___ S.Ct. ___, ___ L.Ed.2d ___, (1978) (suppression hearing may be closed to protect right of defendant to an impartial jury), with Chase v. Robson, 435 F.2d 1059 (7th Cir. 1970) (court may not, over opposition of defendant, restrain defense and prosecuting attorneys from public comment on case). Cf. Runyon v. McCrary, supra (Congress may enforce thirteenth and fourteenth amendment rights of citizens in ways which limit associational rights of others). See generally CBS, Inc. v. Young, 522 F.2d 234 (6th Cir. 1975) (all pre-trial proceedings may not be closed in civil case where no threat to constitutional rights of litigants shown).
[21] Cf., e.g., Erznoznik v. City of Jacksonville, 422 U.S. 205, 95 S. Ct. 2268, 45 L. Ed. 2d 125 (1975) (passers-by offended by movies shown at drive-in theatre free to look the other way); Cohen v. California, 403 U.S. 15, 91 S. Ct. 1780, 29 L. Ed. 2d 284 (1971) (minor threat to sensibilities of onlookers cannot justify punishment for wearing assertedly offensive message on jacket in public place).
[22] Cf. Moore v. City of East Cleveland, 431 U.S. 494, 500 n. 7, 97 S. Ct. 1932, 1936 n. 7, 52 L. Ed. 2d 531 (1977) (statute infringing right of family to live together overturned where ineffective at accomplishing its primary purpose of reducing overcrowding of town); USDA v. Moreno, 413 U.S. 528, 536-38, 93 S. Ct. 2821, 2826-27, 37 L. Ed. 2d 782 (1973) (statute infringing right of association overturned where ineffective at accomplishing its stated purpose of ferreting out food stamp fraud).
[23] See Nebraska Press Ass'n v. Stuart, supra, 427 U.S. at 563-564, 571, 599-603, 96 S. Ct. at 2805, 2808, 2822-23 (Opinion of the Court per Burger, C.J.; Powell, J., concurring; Brennan, J., joined by Stewart and Marshall, JJ., concurring). Compare, e.g., Lovell v. City of Griffin, 303 U.S. 444, 58 S. Ct. 666, 82 L. Ed. 949 (1938) (ban on circulating handbills voided as too burdensome even though the ordinance challenged did not purport to regulate the content of ideas propagated), and Saia v. New York, 334 U.S. 558, 68 S. Ct. 1148, 92 L. Ed. 1574 (1948) (striking down ban on loudspeakers providing police unfettered discretion to make exceptions), with Cantwell v. Connecticut, 310 U.S. 296, 60 S. Ct. 900, 84 L. Ed. 1213 (1940) (parade permit requirement tied to need for public order), and Kovacs v. Cooper, 336 U.S. 77, 69 S. Ct. 448, 93 L. Ed. 513 (1949) (upholding ordinance forbidding only raucous loudspeakers).
[24] See Commonwealth v. Gilman, 470 Pa. 179, 368 A.2d 253 (1977) (prosecutor's closing remarks must be facts in evidence and legitimate inferences therefrom); Commonwealth v. Revty, 448 Pa. 512, 295 A.2d 300 (1972) (same).
[25] See Jackson v. Denno, 378 U.S. 368, 84 S. Ct. 1774, 12 L. Ed. 2d 908 (1964); Commonwealth v. Pierce, supra; Commonwealth ex rel. Gaito v. Maroney, 422 Pa. 171, 220 A.2d 628 (1966).
[26] See Simmons v. United States, 390 U.S. 377, 88 S. Ct. 967, 19 L. Ed. 2d 1247 (1968).
[27] The danger that publicity may deter the accused from exercising his right to suppress evidence and hamper the ability of our state system of criminal justice to afford the accused a fair trial is serious and continuing. Justice Frankfurter observed:
"Not a Term passes without this Court being importuned to review convictions, had in States throughout the country, in which substantial claims are made that a jury trial has been distorted because of inflammatory newspaper accounts too often, as in this case, with the prosecutor's collaboration exerting pressures upon potential jurors before trial and even during the course of trial, thereby making it extremely difficult, if not impossible, to secure a jury capable of taking in, free of prepossessions, evidence submitted in open court."
Irvin v. Dowd, 366 U.S. 717, 729, 81 S. Ct. 1639, 1646, 6 L. Ed. 2d 751 (Frankfurter, J., concurring).
[28] Indeed, the Commonwealth agreed to each defendant's request for special orders in these cases of widespread interest.
[29] Petitioners also asserted that the orders entered by respondents directing participants in the pre-trial proceedings not to discuss the proceedings were overbroad. We did not agree.
"[A] governmental purpose to control or prevent activities constitutionally subject to state regulation may not be achieved by means which sweep unnecessarily broadly and thereby invade the area of protected freedoms." NAACP v. Alabama, 377 U.S. 288, 307, 84 S. Ct. 1302, 1314, 12 L. Ed. 2d 325 (1964), quoted in Zwickler v. Koota, 389 U.S. 241, 88 S. Ct. 391, 19 L. Ed. 2d 444 (1967). A challenge solely to the breadth of a governmental regulation recognizes the lawfulness of the type of regulation; it attacks only the extent of the limitation as insufficiently related to the legitimate governmental interest.
The orders directing participants in the pre-trial proceedings not to discuss the proceedings, like the other orders, were designed to prevent harm to the accused's right to a fair trial and the public interest in prompt, orderly, and final administration of criminal justice by temporarily limiting access to information which might produce undue publicity. See notes 7 & 8 supra. If a participant could describe the events of the pre-trial proceedings, the court's other orders would be rendered useless.
Hence, respondents, through the Rules, had to be able to control the disclosures of every participant in those proceedings. We therefore conclude that the portions of these orders restricting comment upon the suppression hearings by participants were as closely tailored to eliminating prejudicial publicity as were the portions closing the suppression hearings and impounding the records thereof. Therefore, these portions of the orders cannot be considered overbroad. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2358916/ | 690 F. Supp. 1014 (1988)
UNITED STATES of America, Plaintiff,
v.
Cesar AYALA and Jesus Godoy, Defendant.
No. 87-884-CR.
United States District Court, S.D. Florida.
June 3, 1988.
*1015 Chris McAliley, Asst. U.S. Atty., Miami, Fla., for plaintiff.
Robert Boan, Miami, Fla., for defendant.
ORDER DENYING WITHDRAWAL OF PLEA
HASTINGS, District Judge.
THIS CAUSE comes before the Court on Defendant Ayala's Motion to Withdraw Plea, filed May 19, 1988. Defendant Ayala raises several grounds in support of his conclusion that the plea was not entered into knowingly and voluntarily.
A defendant has the burden of showing a "fair and just reason" for withdrawal of his plea. U.S. v. Lombardozzi, 436 F.2d 878 (2d Cir.1971); Fed.R.Crim.P. 32(d). In making this determination, a district court considers (1) whether close assistance of counsel was available; (2) whether the plea was knowing and voluntarily; (3) whether judicial resources would be conserved; and (4) whether the government would be prejudiced if the defendant is allowed to withdraw his plea. U.S. v. Buckles, 843 F.2d 469, 472 (11th Cir.1988) (citations omitted).
Initially, the Court notes that defendant Ayala was represented by counsel throughout the plea bargaining process and subsequent plea colloquy with the Court. Thus, Ayala cannot complain of coercion where his attorney employed his best professional judgment in recommending a plea of guilty. Id. at 472-73.
First, Ayala contends that he did not understand the sentence range applicable in his case in light of his acceptance of responsibility and any recommendation that would be made to the Court. By his own admission, Ayala recognizes that a recommendation is not binding and sentencing lies in the ultimate discretion of the Court. Consequently, on this basis Ayala can not argue that the guilty plea was entered into involuntarily and it cannot be withdrawn. U.S. v. Griffin, 816 F.2d 1 (D.C.Cir.1987). In addition, Ayala's assertion of innocence a contention which he claims prevents him from accepting responsibility and thereby forecloses a more favorable sentencing *1016 recommendation from the Government is insufficient. Such a declaration can not negate his plea, see Buckles at 472-73, particularly when the Court informed Ayala of the maximum sentence he could receive prior to accepting his plea.[1]See Baker v. U.S., 781 F.2d 85 (6th Cir. 1986). The plea is not involuntary merely because it was induced by a promise of a recommendation of a lenient sentence upon acceptance of responsibility. More importantly, Ayala's statements in open court that his plea is intelligent and voluntary[2] and not a product of coercion, carry a presumption of veracity, U.S. v. Darling, 766 F.2d 1095 (7th Cir.1985); U.S. v. Gonzalez-Mercado, 808 F.2d 796 (11th Cir.1987), and of constitutional adequacy, Downs-Morgan v. U.S., 765 F.2d 1534 (11th Cir.1985), which he has not overcome.
Second, Ayala suggests he was also "pressured" because the plea offer was extended only as a "package deal" to both co-defendants. Such "package deal" plea offers, however, are not per se impermissible. U.S. v. Wheat, 813 F.2d 1399 (9th Cir.1987). The plea offer in this case did not deprive him of an individual determination of guilt. Id. While Ayala's concern for his "good friend" (co-defendant Godoy) is understandable, the additional pressure on his decision to plead guilty created by their relationship in no way implicates coerciveness on the part of the Government that would entitle Ayala to withdraw his plea. See U.S. v. Sutton, 794 F.2d 1415 (9th Cir.1986) (threat of prosecution of defendant's female companion and mother of his children insufficient to set guilty plea aside where companion was co-defendant).
Third, Ayala contends that the Government's failure to disclose prior to its announcement in open court that a fingerprint analysis report on the contraband revealed only the fingerprints of co-defendant Godoy would constitute a violation of Brady v. Maryland, 373 U.S. 83, 83 S. Ct. 1194, 10 L. Ed. 2d 215 (1963). Thus, Ayala argues that he did not have time to consider its implication prior to entering a plea of guilty. In its response, the Government asserts this contention to be disingenuous because Ayala's counsel was personally informed prior to the guilty plea of the results of the fingerprint analysis. This issue, however, does not require a resolution. A violation of Brady would not affect the consensual nature of the plea thereby impairing its validity. Assuming arguendo that the Government had not made its disclosure prior to the acceptance of the plea, neither Ayala or his counsel manifested a desire to withdraw or reconsider the plea[3], *1017 even after Ayala had been made more fully aware of the rights he was giving up during the Rule 11 plea colloquy. Ayala has not claimed ineffective assistance of counsel, and under these circumstances can not undermine the validity of the plea.
More importantly, Ayala's Brady claim is a nonjurisdictional challenge waived by the guilty plea. See e.g., Hayle v. U.S., 815 F.2d 879 (2d Cir.1987) (plea of guilty waives all challenges to prosecution except those going to court's jurisdiction); U.S. v. Taylor, 814 F.2d 172, 174 (5th Cir. 1987) (same, thus claims of prosecutorial breach of pretrial agreement and vindictiveness, illegal pretrial detention, and failure of court to rule on motions must fail); U.S. v. Fairchild, 803 F.2d 1121 (11th Cir. 1986) (same, thus claims of duplicitous and vague indictment, prosecutorial vindictiveness and insufficient factual basis to support indictment must fail). Ayala cannot attack the validity plea unless there exists a jurisdictional defect on the face of the indictment. U.S. v. Baugh, 787 F.2d 1131 (7th Cir.1986) (guilty plea does not waive challenge that indictment is constitutionally infirm on its face in violation of double jeopardy clause). He has pointed to no such infirmity in the indictment to which he plead guilty and the Court finds none.
Finally, Ayala argues that the plea agreement itself does not conform to his understanding of the nature of the agreement because it requires him to accept responsibility for the offense in order to receive a more lenient recommendation from the Governmenta requirement he will not comply with because he continues to maintain his innocence. This argument is merely a variation of Ayala's first claim. The Court explained the charges to Ayala and he was given ample opportunity to discuss them with counsel. Defendant Ayala understood the terms of the plea agreement during the proceeding and stated his satisfaction with it. At no time did Ayala give any indication that he did not know what he was doing or that the waiver of his rights was not voluntary. Throughout the colloquy this Court queried defendant Ayala extensively as to his understanding of the nature and consequences of the plea and Ayala stated that no other promises had been made to him. These statements carry a strong presumption of truth, U.S. v. Gonzalez-Mercado, supra, and Ayala has failed to overcome that presumption. Significantly, neither defendant expressed dissatisfaction as to the terms of plea agreement as recited by the Government.[4]
In conclusion, the Court finds that defendant Ayala entered into his plea knowingly and voluntarily with the close assistance of counsel. "All pleas of guilty are the result of some pressures or influences on the mind of the defendant." Buckles at *1018 472, citing Schnautz v. Beto, 416 F.2d 214, 215 (5th Cir.1969). Ayala, however, has failed to demonstrate a "fair and just reason" for allowing the withdrawal of his plea. This Court is unable to conclude that to allow his plea to stand would result in manifest injustice. U.S. v. Sawyer, 799 F.2d 1494 (11th Cir.1986). Consequently, the remaining factors of Buckles need not be considered. Id. at 472 n. 3.
For the foregoing reasons, it is hereby
ORDERED AND ADJUDGED that the defendant Ayala's Motion to Withdraw Plea is, in all respects, DENIED.
NOTES
[1] The following explanation was provided to both defendants:
The Court: * * * *
So then, you are giving up your rights to a trial, and today I will enter a judgment of guilty, and pursuant to the sentencing guidelines, order a presentence investigation into your respective backgrounds.
You must understand that, under this provision, the Court generally will follow the sentencing guidelines, but I am not bound such that I cannot go beyond the guidelines and sentence you to a sentence higher than the guidelines would accord and/or if there is some particular circumstance that is unusual or with the assistance of the prosecutor, sometimes below the guidelines.
* * * * * *
Record at 9.
[2] The defendants were asked the following questions:
THE COURT: Do you understand what you are charged with and what the maximum possible penalty is in this offense?
DEFENDANT GODOY: Yes, I understand.
DEFENDANT AYALA: Yes, sir.
THE COURT: Mr. Godoy, has anybody threatened you or in any way forced you to enter into this plea?
DEFENDANT GODOY: No, sir.
THE COURT: Mr. Ayala, has anybody threatened you or forced you to enter into this plea?
DEFENDANT AYALA: No, sir.
Record at 11.
[3] Before the conclusion of the plea colloquy, the Government established the following record:
MS. MCALILEY: Judge, I have just one more thing. This doesn't relate to the plea, but I have no other record of it.
Prior to the plea this morning, I did provide defense counsel with fingerprint reports, and it is my obligation to provide it, so I want the record to reflect that.
It shows that the Defendant Godoy's fingerprints were found on a bag that had cocaine, but the Defendant Ayala's fingerprints were not found.
THE COURT: Okay.
Then we are in recess.
Record at 17-18.
[4] The terms of the plea agreement were disclosed as follows:
THE COURT: Now then, has there been a plea agreement entered into in this matter?
MS. MCALILEY: Yes, Your Honor, and, if I may, I would like to recite the provisions.
The agreement is that both defendants are pleading guilty to Count I of the indictment. That is the substantive count which charges them with possession with intent to distribute cocaine, and that has the maximum penalties that you have just related, including the minimum of ten years in jail.
* * * * * *
In addition, the government will recommend to Your Honor that Your Honor credit them for acceptance of responsibility, as that is defined in the guidelines.
That recommendation is conditioned upon them being truthful and cooperative with the probation officers.
We don't want a situation where we recommend that, at the outset, and hear from probation they were not cooperative.
* * * * * *
MR. BOAN (counsel for Ayala): As to the agreement, that is correct. Mr. Ayala is not contesting the forfeiture of that, but he is acknowledging that the government is going to proceed to forfeit that.
* * * * * *
Record at 12.
Neither defendant objected to acceptance of responsibility as stated by the Government. Moreover, in this case, the acceptance of responsibility was conditional. If Ayala accepted responsibility, then he would receive credit for such action. If he declined, then no such credit would be factored into the determination of his sentence. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1173574/ | 647 P.2d 796 (1982)
103 Idaho 340
Ardell K. SCHMIDT, Applicant-Appellant,
v.
STATE of Idaho, Respondent.
No. 13795.
Court of Appeals of Idaho.
June 29, 1982.
*797 Charles F. Bean, Coeur d'Alene, for applicant-appellant.
David H. Leroy, Atty. Gen., Lynn E. Thomas, Sol. Gen., Timothy Walton, Deputy Atty. Gen., on brief, and Myrna A.I. Stahman, Deputy Atty. Gen., on oral argument, Boise, for respondent.
WALTERS, Chief Judge.
I. Facts and Procedure.
This is an appeal from an order of the district court granting summary disposition of an application for post-conviction relief. The applicant, Ardell K. Schmidt, was charged with the unlawful delivery of a controlled substance. He was found to be an indigent person, an attorney was appointed to represent him, and he entered a plea of not guilty. The day before his trial Schmidt changed his plea to guilty. Thereafter the trial court sentenced him to the custody of the Board of Correction for an indeterminate period not to exceed fifteen years. The trial court retained jurisdiction for the first one hundred-twenty days pursuant to I.C. § 19-2601.
While in the custody of the Board, Schmidt was sent to the North Idaho Correctional Institution located at Cottonwood, Idaho. Near the expiration of the period of retained jurisdiction, Schmidt appeared before the Board's central classification committee. Following the classification hearing, the committee recommended that the trial court relinquish jurisdiction over Schmidt. The trial court reviewed the committee's recommendations and terminated jurisdiction, ordering that the remainder of the sentence be served.
Schmidt then filed an application for post-conviction relief before the district court. Schmidt alleged that he had been denied due process of law in the proceeding before the classification committee at Cottonwood. The district court gave notice of intent to dismiss the application, ruling that the procedure followed by the committee conformed with the requirements of State v. Wolfe, 99 Idaho 382, 582 P.2d 728 (1978). Pursuant to Idaho Code § 19-4906(b), Schmidt was given twenty days within which to respond to the court's proposed *798 dismissal of the application. Schmidt then timely filed a motion for leave of court to supplement his application for post-conviction relief. Thereafter, and following a series of motions and orders relating to the appointment of counsel, discovery, and similar matters, Schmidt filed an amended application for post-conviction relief.
Both Schmidt and the state then filed motions for summary disposition pursuant to I.C. § 19-4906(c). These motions represented that no genuine issues of material fact existed in respect to the amended application, and that each moving party was entitled to judgment on the application as a matter of law. Following argument and receipt of briefs, the district court entered an order granting the state's motion and dismissed the amended application. Schmidt appeals. We affirm the order of the district court.
II. Issues on Appeal.
On appeal, Schmidt contends that the district court erred in making seven rulings in the order granting summary disposition. These rulings are as follows: (a) that the general nature of the crime was explained to Schmidt prior to acceptance of his plea of guilty; (b) that the trial court had no duty to explain the specific elements of the crime with which Schmidt was charged, prior to accepting his plea of guilty; (c) that the trial court had no obligation to ascertain whether there was a sufficient factual basis for the charge, prior to accepting Schmidt's plea of guilty; (d) that a letter from Schmidt's brother-in-law to the prosecutor was not material to the charge of delivery of a controlled substance, and was thus not discoverable by Schmidt; (e) that Schmidt was not denied the right of appeal due to inadequate counsel; (f) that Schmidt was not entitled to the assistance of legal counsel in respect to the classification hearing held at the Cottonwood facility; and (g) that a trial court may terminate its jurisdiction over a defendant without first holding an evidentiary hearing.
III. Voluntariness and Understanding of the Plea.
The first two issues on appeal concern the acceptance of Schmidt's plea of guilty. Schmidt argues that the district court erred in ruling that the nature of the crime was explained to Schmidt prior to acceptance of his plea of guilty, and that the court also erred in ruling that the trial court had no duty to explain to him the elements of the crime charged, prior to accepting his plea of guilty. These issues relate to the voluntariness and understanding requirements of his plea.
Schmidt argues that his plea of guilty was not voluntarily entered because neither the nature of the crime nor the elements thereof were explained to him prior to acceptance of his plea. In this regard, Schmidt cites the cases of McCarthy v. United States, 394 U.S. 459, 89 S. Ct. 1166, 22 L. Ed. 2d 418 (1969) and Henderson v. Morgan, 426 U.S. 637, 96 S. Ct. 2253, 49 L. Ed. 2d 108 (1976).
McCarthy focused on the procedure that must be followed under Rule 11 of the Federal Rules of Criminal Procedure, before a United States district court may accept a guilty plea. By its own terms that decision was rendered pursuant to the supervisory power of the United States Supreme Court over the federal courts in the administration of criminal law, and because of an apparent conflict between the federal courts of appeal over the effect of the failure of federal district judges to follow the provisions of Federal Rule 11. The Idaho Supreme Court has recognized that the court in McCarthy "expressly based its decision upon its supervisory power over the courts rather than upon constitutional grounds." State v. Colyer, 98 Idaho 32, 34, 557 P.2d 626, 628 (1976). It has also been noted that "Rule 11, Fed.R.Crim.P., of course, does not apply to a plea of guilty in state courts." Wilkins v. Erickson, 505 F.2d 761, 765 (9th Cir.1974). Because of its uniqueness as a federal procedural decision under a specific rule of practice in the federal courts, we deem McCarthy to be inapplicable to Schmidt's case.
*799 Schmidt properly cites Henderson, supra, for the proposition that when pleading guilty a defendant must be informed of the nature and elements of the crime charged; otherwise his plea of guilty may be deemed involuntary either because he did not understand the nature of the constitutional protections which he waives by pleading guilty, or because he had such an incomplete understanding of the charge that his plea cannot stand as an intelligent admission of guilt. In Henderson, the defendant was charged with first degree murder but pled to second degree murder through a plea bargain. At the time of the plea, no discussion of the elements of second degree murder were had with the court; specifically, there was no reference to the requisite intent to cause the death of the victim, an element of second degree murder. On appeal, the United States Supreme Court noted that the charge of second degree murder was never formally made. The Court observed that had it been so made, it necessarily would have included the charge that the offense was committed with a design to effect the death of the victim. The Court held that lack of a formal charge resulted in failure to inform the defendant of the necessary elements of the crime and prevented his plea of guilty from being voluntary in the constitutional sense.
Henderson also held the guilty plea could not be voluntary in the sense that it constituted an intelligent admission by the defendant to the offense, unless he received real notice of the true nature of the charge against him. The Court noted further that ordinarily the record of the proceedings contains either an explanation of the charge by the trial judge or at least a representation by defense counsel that the nature of the offense has been explained to the accused. The Court in Henderson concluded that because the defendant did not receive adequate notice of the offense to which he pled guilty, his plea was involuntary; and therefore its acceptance was inconsistent with the defendant's rights of due process of law.
Schmidt's situation differs greatly from Henderson. When Schmidt appeared before the trial court to withdraw his plea of not guilty and to interpose a plea of guilty to the charge of unlawful delivery of a controlled substance, the judge had the clerk read the information to Schmidt in open court, before proceeding further. Then, before allowing Schmidt to plead guilty to the offense, the judge advised him in a lengthy colloquy. The judge reminded him of the various pleas that could be entered, and that upon a plea of not guilty, a jury trial would be held and the state would be required to prove guilt beyond a reasonable doubt. The judge discussed the presumption of innocence; the right of confrontation; the right to subpoena witnesses; and the right against self-incrimination. The judge explained that a plea of guilty would waive the right to trial by jury as well as the other rights outlined to him. The judge advised that a plea of guilty would admit the truth of all of the essential elements of the charge as filed in the information, including the issue of intent, and that a plea of guilty would be an admission of all facts stated in the information. The judge specifically noted that a plea of guilty would admit guilt of the crime of delivery of a controlled substance. Finally, the judge advised Schmidt of the maximum penalty that could be imposed for the crime either under a plea of guilty or upon conviction following a plea of not guilty.
In addition to the foregoing, the judge further determined the voluntariness of Schmidt's plea by inquiring as to whether Schmidt was under the influence of any alcohol or other narcotic or non-narcotics of any kind; whether Schmidt had any thoughts that he was not mentally competent to enter a plea; whether he was entering his plea under any compulsion, promises of leniency or reward, or threats; and if there was any other reason, whether asked by the court or not, why his plea would not be voluntary.
In regard to Schmidt's plea, the decision in State v. Colyer, 98 Idaho 32, 557 P.2d 626 (1976) is pertinent. There, our Supreme Court held that the question whether a plea is voluntary and understood by a defendant *800 in Idaho entails inquiry into whether the defendant understands the nature of the charges and is not coerced in entering his plea. It also entails inquiry into whether the defendant knowingly and intelligently waives his right to a jury trial, to confront his accusers, and to refrain from incriminating himself. Lastly, it entails inquiry into whether the defendant understands the consequences of pleading guilty: at a minimum, the record must show that the defendant realized the possible maximum penalty which could be imposed.[1] Our Supreme Court encouraged trial judges to engage defendants seeking to plead guilty in as thorough and detailed a dialogue as time, resources and circumstances permit, in order to forestall subsequent collateral attack on the guilty plea. Id. at 36, 557 P.2d at 630.
After Colyer, the Idaho court decided State v. Bradley, 98 Idaho 918, 575 P.2d 1306 (1978). There the court addressed the issue of whether the trial court erred in accepting a plea of guilty to the crime of second degree murder without explaining to the defendant the element of intent. The court held that the requisites laid down in State v. Colyer were met in Bradley's case. The court noted that the information was read to Bradley, which referred to the necessary element of intent. The court also noted that the element of intent was discussed in the presence of Bradley.
In the subsequent case of Sparrow v. State, 102 Idaho 60, 625 P.2d 414 (1981), the court also discussed the adequacy of informing a defendant of the intent element of the crime. There the court said:
In order for a guilty plea to be voluntary, a defendant must be informed of the intent elements requisite to the charged offense. Henderson v. Morgan, 426 U.S. 637, 96 S.C. 2253, 49 L. Ed. 2d 108 (1976); State v. Bradley, 98 Idaho 918, 575 P.2d 1306 (1978). In State v. Bradley, supra, we held that this requirement was satisfied where the information containing a reference to the necessary element of intent was read to the defendant, and there was no showing that the defendant was not conversant with the English language or that he lacked normal intelligence and education.
102 Idaho at 61, 625 P.2d at 415.
Here, we have almost the same situation as occurred in Bradley and Sparrow. The information was read to Schmidt in open court. In accepting his plea, the court advised him that the plea of guilty would admit the truth of all essential elements of the charge as recited in the information, including admission of the issue of intent. There is no showing that Schmidt was not conversant with the English language, or lacked normal intelligence or education.
In our view the procedure and colloquy engaged in by the trial court with Schmidt comport with the requirements of Henderson and Colyer. We therefore hold that the district court did not err in its determination that Schmidt was informed of the nature of the offense. Although the district court held that explanation of the elements of the offense was not required, we hold that, under the authorities cited, Schmidt was informed and advised of the elements of the crime as alleged in the information.
IV. Factual Basis for the Plea.
The next issue raised by Schmidt concerns the finding of the court below that the trial court had no obligation to ascertain whether there was a sufficient factual basis for the charge, prior to accepting Schmidt's plea of guilty. Schmidt argues that a defendant must be given the facts and opportunity necessary to make an intelligent plea decision, in order for his plea to be voluntarily and understandingly made.
The record here shows that Schmidt was apprised by the court that a plea of guilty would be an admission of all facts relevant *801 to the matter which were contained in the information filed against him. We are cited to no authority, nor does our research disclose a requirement, to the effect that in all cases the court must establish a sufficient factual basis prior to accepting a plea of guilty in Idaho.
We are aware of the standard of the American Bar Association, PLEAS OF GUILTY, § 1.6 (1968), which recommends that the court should not enter a judgment upon acceptance of a plea of guilty without making such inquiry as may satisfy the court that there is a factual basis for the plea. In this regard, Criminal Justice Standards Bench Book for Special Court Judges, 15 nn. 2, 3 (2d ed. April, 1976), explains as follows:
"[t]he purpose of placing the factual basis motivating the guilty plea on the record serves multiple purposes; (1) it aids the Court in insuring that the defendant is pleading to a charge which could actually have been proven if a trial had been held; (2) it aids the defendant in fully understanding the charge against him; (3) this inquiry provides a more accurate record of the conviction process which minimizes the chances of a defendant successfully challenging his conviction later... .
* * * * * *
The Court should ascertain that the facts recited support the crime charged, since the defendant has a right to be convicted only of the crime he committed and to which he is pleading guilty. This right arises from the double jeopardy provisions contained in both Federal and State constitutions."
We note also the ABA Standards, The Function of the Trial Judge, § 4.2 (1972), specifies matters which should be covered by a trial judge when accepting pleas of guilty, including an inquiry that there is a factual basis for the plea. Section 4.2, supra, appears to have been adopted in part by our Supreme Court in Rule 11(c) of the Idaho Criminal Rules. Rule 11(c) covers basically the same information required in the ABA Standard, § 4.2; however, the rule does not include the requirement that the trial court make an inquiry regarding the factual basis for the plea. This indicates to us that the Supreme Court of Idaho has determined that, as a general rule, there is no requirement of inquiry as to the factual basis for a plea.
Several exceptions to this general rule have developed in cases where a defendant seeks to have his plea accepted by the court, but (a) does not recall the facts of the incident which resulted in the offense charged, or (b) is unwilling or unable to admit his participation in the acts constituting the crime, or (c) couples his plea with continued assertion of innocence. See North Carolina v. Alford, 400 U.S. 25, 91 S. Ct. 160, 27 L. Ed. 2d 162 (1970); State v. Sparrow, supra; State v. Martinez, 89 Idaho 129, 403 P.2d 597 (1965). Here, Schmidt does not contend, nor show, that he falls within any of these exceptions. We hold that, unless a case falls within one of these exceptions, a court presented with a plea of guilty need not inquire into the underlying factual basis before accepting the plea. Of course, this holding does not diminish a court's obligation to conduct such an inquiry if after a plea is entered but before sentence is imposed the court receives information raising an obvious doubt as to whether the defendant is in fact guilty. In such circumstances, the trial court should inquire into the factual basis of the plea, either to dispel the doubt or to allow the defendant to plead anew.
The procedure followed in Schmidt's case was consistent with the foregoing. At the conclusion of the proceedings when Schmidt pled guilty, the judge directed the clerk to record the plea. The matter was then continued for sentencing, pending preparation and submission of a pre-sentence report.
At the sentencing hearing, in the course of making a recommendation to the court for disposition of Schmidt's case, the prosecutor orally advised the court in the presence of Schmidt and his counsel of Schmidt's involvement in the delivery of the controlled substance. Schmidt did not *802 dispute the prosecutor's statements. In fact, Schmidt's counsel acknowledged to the court that Schmidt "was more or less of a go-between during the actual drug buying process." At the conclusion of that hearing the court entered judgment and sentenced Schmidt. Schmidt's plea and the prosecutor's outline of the factual basis for the charge were thus both presented to the court, before the plea was finally accepted, when the court adjudicated Schmidt guilty of the crime.
We find no reversible error in the determination of the court below that Schmidt was not entitled to post-conviction relief on the issue regarding the existence of a factual basis for his plea.
V. Disclosure of Evidence.
Schmidt's next argument concerns the existence of a letter received by the prosecutor, which was not disclosed to Schmidt until after he had pled guilty. During the sentencing hearing the prosecutor, in the course of making his recommendation to the court on the sentencing, mentioned he had received a letter from Schmidt's brother-in-law. The prosecutor disclosed that he had forwarded the letter to the federal drug enforcement administration. Although Schmidt had requested information in the possession of the state pursuant to a motion for discovery filed with the court prior to the entry of his guilty plea and while still preparing for trial, the existence or contents of this letter was not disclosed by the prosecution.
In Schmidt's application for post-conviction review, he represented that he had reason to believe the letter contained information which, if revealed to the court, would show he was innocent. He contended the prosecution had an absolute obligation to reveal the contents of the letter, but wrongfully failed to do so. Schmidt represented that, since the filing of the application for post-conviction relief, he had made diligent efforts to obtain a copy of the letter from the state. His attempts were unsuccessful because the prosecution no longer had possession of the letter and could not obtain it from the drug enforcement agency. He argued that the prosecution's failure to produce the document was an arbitrary act which deprived him of his liberty without due process of law.
In the post-conviction proceeding, the state acknowledged that the letter had been received and that its existence was not disclosed until the sentencing hearing. It was admitted the letter could no longer be found. The deputy prosecuting attorney filed an affidavit stating he recalled receiving the letter but could no longer recollect its specific contents. He stated he did recall, however, that the letter did not contain exculpatory evidence nor any information material to the preparation of either the prosecution's case or the defendant's case.
Schmidt relies upon the case of Brady v. Maryland, 373 U.S. 83, 83 S. Ct. 1194, 10 L. Ed. 2d 215 (1963), for the proposition that suppression by the prosecution of evidence favorable to an accused violates due process, where disclosure of the evidence has been requested and the evidence is material either to guilt or to punishment irrespective of the good faith or bad faith of the prosecution. See also State v. Harwood, 94 Idaho 615, 495 P.2d 160 (1972); I.C.R. 16.
We will first discuss the effect of the failure of the state to disclose evidence which may be material to the determination of guilt, in the case where the defendant waives his right to trial by pleading guilty. The Idaho court has recognized the following:
A plea of guilty has the same force and effect as a judgment rendered after a full trial on the merits. [Citations omitted.] By pleading guilty the appellant waived all defenses which might have been raised other than the defense that the information failed to state a public offense or the defense that the court did not have jurisdiction. [Citations omitted.]
Lockard v. State, 92 Idaho 813, 818, 451 P.2d 1014, 1019 (1969). The court has also stated,
[a] valid plea of guilty, voluntarily and understandingly given, waives all nonjurisdictional defects and defenses, *803 whether constitutional or statutory, in prior proceedings. [Citations omitted.] A valid guilty plea is a judicial admission of all facts charged by the indictment or information. [Citations omitted.] A valid plea of guilty is conclusive as to guilt. [Citations omitted.] It is a waiver of trial, [Citations omitted.] and obviates the necessity of the prosecution coming forward with evidence. [Citations omitted.] A conviction had on a valid plea of guilty is not subject to collateral attack on the ground that as a factual matter the accused was not guilty of the offense charged. [Citations omitted.]
Clark v. State, 92 Idaho 827, 832-33, 452 P.2d 54, 59-61 (1969); see also Still v. State, 97 Idaho 375, 377, 544 P.2d 1145, 1147 (1976).
We hold that Schmidt, having waived his right to jury trial, also waived his right to disclosure of evidence by the prosecutor. The failure on the part of the prosecutor to disclose the evidence was not jurisdictional.
Under Brady v. Maryland, supra, the letter could possibly be relevant to the punishment meted out to Schmidt at the sentencing proceeding. However, his counsel[2] did not take any steps during the course of that proceeding to demand to see the contents of the letter. Schmidt's application for post-conviction review indicates that any further attempts to locate the letter or the writer thereof have been futile. This leaves us in the position of only speculating as to whether or not the letter would in fact have had any bearing upon the punishment in Schmidt's case. It was incumbent upon Schmidt to show the materiality of the contents of the letter to the sentence in his case. The materiality of the letter is highly questionable in light of the affidavit of the prosecuting attorney that to the best of his recollection the letter contained neither exculpatory nor inculpatory statements.
It is well established in Idaho that the trial court has broad discretion in determining what evidence is to be admitted at the sentencing hearing. State v. Johnson, 101 Idaho 581, 583, 618 P.2d 759, 761 (1980). Following reception of evidence regarding the possibility of punishment, the punishment or sentence to be imposed by the court is committed to the sound discretion of the court, subject to maximum penalties set forth in the statutes and subject to any required minimum period of incarceration. See I.C. § 19-2601; State v. Wagenius, 99 Idaho 273, 279, 581 P.2d 319, 325 (1978). Given the waiver of trial by Schmidt, through entry of a guilty plea, and the broad discretion allowed to the trial court in the reception of evidence regarding sentencing and determination of the appropriate sentence to be given, we agree with the ruling of the district court that Schmidt was not entitled to post-conviction relief because of nondisclosure of the letter sent by the brother-in-law to the prosecuting attorney.
VI. Denial of Right to Appeal.
Schmidt next contends the district court erred in ruling he was not denied the right of appeal due to inadequate advice of counsel. Schmidt discloses he did not appeal his conviction because he was fearful that a new statute, I.C. § 19-2513A, pertaining to fixed sentences, would result in his being resentenced to a fixed term of incarceration upon remand following a successful appeal. A letter to that effect, from Schmidt to his counsel, was submitted as part of the post-conviction proceeding.[3] Schmidt argues that his attorney should have advised him the new statute was not in effect when Schmidt committed the crime and that the statute therefore would not apply to him. He concludes that he was denied the right to appeal because of the conduct of his counsel. We disagree.
*804 The district court recognized that it was not clear whether resentencing of Schmidt under I.C. § 19-2513A would constitute an ex post facto application of the statute. See Dobbert v. Florida, 432 U.S. 282, 97 S. Ct. 2290, 53 L. Ed. 2d 344 (1977); Lindsey v. Washington, 301 U.S. 397, 57 S. Ct. 797, 81 L. Ed. 1182 (1937). We deem it unnecessary to decide whether such an application would have been permissible. The fact that the statute arguably might be so applied indicates to us that Schmidt's reason for not appealing may have been soundly based. We cannot fault Schmidt's counsel for failing to give a definitive answer to Schmidt, even if one was required, where the issue was not free from doubt. While counsel is obligated to give a defendant his professional judgment as to whether meritorious grounds for appeal exist and as to the probable results of an appeal, the question whether an appeal should be taken is ultimately a matter for the defendant to decide. United States v. Neff, 525 F.2d 361 (8th Cir.1975.) An appeal is a matter of choice, not of right, and "the determination of whether an appeal should be taken or not rests solely with the accused and is not to be decided by his attorney." Gardner v. State, 91 Idaho 909, 912, 435 P.2d 249, 252 (1967). (Emphasis original.)
The record here shows that Schmidt knew he could appeal his conviction, but chose not to, for his own reasons. We concur with the determination made by the district court that, under the circumstances, Schmidt's counsel was not ineffective merely because he failed to advise Schmidt that his reason for not appealing might have been unfounded.
VII. Right to Counsel at the Classification Hearing.
Schmidt next contests the ruling of the district court that he was not entitled to the assistance of counsel in the classification proceeding held at the Cottonwood facility. The district court's determination was based upon State v. Wolfe, 99 Idaho 382, 582 P.2d 728 (1978). In Wolfe, our Supreme Court established certain procedural requirements which must be followed, to accord due process to a defendant during classification hearings, prior to rendering a report to the sentencing judge under the retained jurisdiction concept. It said:
The prisoner must be given adequate notice before the hearing, including notice of the substance of all matters that will be considered. The prisoner must be given an opportunity to explain or rebut any testimony or recommendations. In addition, the prisoner must be free to call witnesses in his behalf from among the employees and other prisoners at [the facility where he is being held]. This information should be included in the report sent back to the sentencing judge.
These minimal procedures will help ensure the report is as complete as possible and guarantee a basic fairness for both the prisoner and the sentencing judge... . (Emphasis supplied.)
99 Idaho at 389, 582 P.2d at 735.
Schmidt urges that an additional procedural requirement that of assistance of counsel should be adopted in regard to classification hearings during the retained one hundred-twenty days. For authority, he cites Mempa v. Rhay, 389 U.S. 128, 88 S. Ct. 254, 19 L. Ed. 2d 336 (1967). Mempa held that a probationer is entitled to be represented by counsel at a combined hearing where his probation is revoked and he is sentenced the imposition of sentence having been deferred during the period of probation. The Court in Mempa adhered to the rule that a defendant is entitled to counsel at sentencing, Gideon v. Wainwright, 372 U.S. 335, 83 S. Ct. 792, 9 L. Ed. 2d 799 (1963), and Townsend v. Burke, 334 U.S. 736, 68 S. Ct. 1252, 92 L. Ed. 1690 (1948), even when it is accomplished as a part of a subsequent probation revocation proceeding. Mempa, supra, 389 U.S. at 137, 88 S.Ct. at 258. Subsequently, in Gagnon v. Scarpelli, 411 U.S. 778, 93 S. Ct. 1756, 36 L. Ed. 2d 656 (1973), the Court held that in probation revocation hearings following sentencing, the decision as to the need for counsel, to comport with due process requirements, must be made on a case-by-case basis in the exercise of a sound discretion *805 by the state authority charged with the responsibility for administering the probation and parole system. Id. at 790, 93 S.Ct. at 1763-1764.
From these cases, we conclude that a defendant is entitled to representation by counsel at sentencing, but not at probation revocation proceedings except when dictated by special circumstances, unless those proceedings are a combined sentencing and probation revocation proceeding.
Here Schmidt had been sentenced, while represented by counsel, before he was committed to the custody of the Board of Correction subject to the period of jurisdiction retained by the court. The appearance before the classification committee was neither a sentencing proceeding nor a probation revocation proceeding. It was an information gathering process, including study and evaluation of Schmidt, for compilation of a recommendatory report to the trial court. State v. Wolfe, 99 Idaho at 387, 582 P.2d at 733.
Because of the uniqueness of the retained jurisdiction process in Idaho, we conclude that Mempa and Gagnon cannot be strictly applied to the classification hearings involved in retained jurisdiction. However, in Gagnon the court made some cogent observations as to whether counsel should be required at probation revocation hearings. That court said,
The introduction of counsel into a revocation proceeding will alter significantly the nature of the proceeding. If counsel is provided for the probationer or parolee, the State in turn will normally provide its own counsel; lawyers, by training and disposition, are advocates and bound by professional duty to present all available evidence and arguments in support of their clients' positions and to contest with vigor all adverse evidence and views. The role of the hearing body itself, aptly described in Morrissey as being "predictive and discretionary" as well as fact-finding, may become more akin to that of a judge at a trial, and less attuned to the rehabilitative needs of the individual probationer or parolee. In the greater self-consciousness of its quasi-judicial role, the hearing body may be less tolerant of marginal deviant behavior and feel more pressure to reincarcerate rather than to continue nonpunitive rehabilitation. Certainly, the decision making process will be prolonged, and the financial cost to the State for appointed counsel, counsel for the State, a longer record, and the possibility of judicial review will not be insubstantial.
411 U.S. at 787, 93 S.Ct. at 1762.
We share a similar concern about interjecting an unlimited right to counsel into classification hearings in the retained jurisdiction process. We presume that the Idaho Supreme Court considered the possibility of such a requirement when it rendered the decision in Wolfe and settled on the limited safeguards espoused in that decision. In our view it would be inappropriate, and unjustified in the instant case, for us to impose an additional procedural requirement of assistance of counsel in such matters. We hold that the district court did not err in determining that, by the authority of Wolfe, Schmidt was not entitled to counsel at his classification hearing.
VIII. Termination of Jurisdiction Without a Hearing.
The final issue raised by Schmidt is whether the district court erred in holding that a trial court may terminate its jurisdiction over a defendant without first granting the defendant an opportunity to present evidence in his behalf during a hearing before the court. This issue poses what some observers might view as an anomaly. A defendant has the right to a hearing, with counsel, when he is sentenced, State v. Ditmars, 98 Idaho 472, 567 P.2d 17 (1977) cert. denied, 434 U.S. 1088, 98 S. Ct. 1284, 55 L. Ed. 2d 793 (1978). If he is granted probation, he is entitled to a hearing before the probation can be revoked and a sentence of confinement imposed. State v. Moore, 93 Idaho 14, 454 P.2d 51 (1969). However, if he is sentenced to confinement at the outset, subject to review after additional information has been gathered during a period *806 of retained jurisdiction, he is not entitled any hearing before the court terminates jurisdiction and orders confinement for the remaining term of the sentence. See State v. Lopez, 102 Idaho 692, 693, 638 P.2d 889, 890 (1981); State v. Phillips, 99 Idaho 354, 355, 581 P.2d 1173, 1174 (1978); Belknap v. State, 98 Idaho 690, 691, 571 P.2d 336, 337 (1977); see especially, State v. Ditmars, supra. Until our Supreme Court holds otherwise, we feel bound to adhere to these decisions. We therefore hold the district court did not err in ruling that Schmidt was not entitled to a hearing before the trial court relinquished jurisdiction.
Accordingly, the dismissal of Schmidt's amended application for post-conviction relief is affirmed.
BURNETT and SWANSTROM, JJ., concur.
NOTES
[1] The court in Colyer also held that the failure of the trial court to inform the defendant that he was presumed innocent until proven guilty beyond a reasonable doubt, and that there may be several defenses to the crime charged such as insanity did not result in denial to the defendant of his constitutional rights. State v. Colyer, 98 Idaho at 33 n. 1, 557 P.2d at 627. Accord, State v. Thacker, 98 Idaho 369, 370, 564 P.2d 1278, 1279 (1977).
[2] Schmidt is represented on appeal by counsel other than the attorney who represented him at the sentencing proceedings.
[3] That letter, as Schmidt wrote it, is as follows:
"I don't think I want to appeal my case. Because I am afraid that the judge will give me a fixed sentence. But, I would like a post-conviction. I think the sentence was to harsh. I shouldn't been given over 5 years." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3106258/ | Order issued April 15, 2014
In The
Court of Appeals
For The
First District of Texas
____________
NO. 01-13-00632-CR
ISRAEL CASTILLO, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the County Criminal Court at Law No. 8
Harris County, Texas
Trial Court Case No. 1863072
ABATEMENT ORDER
The reporter’s record in this case was due October 30, 2013. See TEX. R. APP. P.
35.1. On November 7, 2013, this court ordered Sondra Humphrey, the court reporter,
to file the record within 30 days. On January 16, 2014, Humphrey filed a motion for
extension of time to file the record which was granted to February 14, 2014, with no
further extensions to be granted. On February 25, 2014, Humphrey filed another
motion for extension of time to file the record which was denied, and Humphrey was
ordered to file the reporter’s record within 10 days of the order, or this court may require
Humphrey to appear and show cause why the record has not been filed. The record has
not been filed with the court.
In cause number 01-13-00227-CR, Washington v. State, this Court ordered
Humphrey to appear and show cause as to why she had not filed the reporter’s record in
this Court. On March 26, 2014, Humphrey failed to appear as noticed. Humphrey has
also failed to file reporter records in cause numbers 01-13-00633-CR, Matamoros v.
State, 01-13-00896-CR, Bankett v. State, and 01-13-01048-CR, Acosta v. State.
The trial and appellate courts are jointly responsible for ensuring that the appellate
record is timely filed. See TEX. R. APP. P. 35.3(c). Because the reporter’s record has not
been filed timely as ordered in this cause and because Humphrey is delinquent on the
matters listed above, we issue the following order.
We direct the judge of the County Criminal Court at Law No. 8 to conduct a
hearing at which Sondra Humphrey, a court reporter, appellant’s counsel, and
appellee’s counsel shall participate (a) to determine the reason for failure to file the
record, (b) to establish a date certain when the reporter’s record will be filed, and (c) to
make findings as to whether Sondra Humphrey should be held in contempt of court for
failing to file the reporter’s record timely as ordered. We order the court to prepare a
record, in the form of a reporter’s record, of the hearing. The judge shall make findings
of fact and conclusions of law, and shall order the trial court clerk to forward to this
Court a supplemental clerk’s record containing the findings and conclusions. The
hearing record and supplemental clerk’s record shall be filed with the Clerk of this Court
within 30 days of the date of this order.
The appeal is abated, treated as a closed case, and removed from this court’s active
docket. The appeal will be reinstated on this Court’s active docket when the trial court’s
findings and recommendations are filed in this Court. The Court will also consider an
appropriate motion to reinstate the appeal filed by either party, or the Court may reinstate
the appeal on its own motion. If Humphrey files the record prior to the date set for the
hearing, the appeal will be reinstated and the trial court need not hold a hearing.
PER CURIAM
Panel consists of Chief Justice Radack and Justices Massengale and Huddle. | 01-03-2023 | 10-16-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1431414/ | 25 Cal. 3d 813 (1979)
603 P.2d 425
160 Cal. Rptr. 323
BELA GEORGE LUGOSI et al., Plaintiffs and Appellants,
v.
UNIVERSAL PICTURES, Defendant and Appellant.
Docket No. L.A. 30824.
Supreme Court of California.
December 3, 1979.
*815 COUNSEL
Irwin O. Spiegel for Plaintiffs and Appellants.
Grossman & Shames and Harvey M. Grossman as Amici Curiae on behalf of Plaintiffs and Appellants.
*816 Robert L. Wilson for Defendant and Appellant.
Rosenfield, Meyer & Susman, H. Mitchell Gould and Jeffrey L. Nagin as Amici Curiae on behalf of Defendant and Appellant.
OPINION
THE COURT.
We granted a hearing in this case in order to consider the important issues raised. After an independent study of these issues, we have concluded that the thoughtful opinion of Presiding Justice Roth for the Court of Appeal, Second Appellate District, in this case correctly treats the issues, and accordingly adopt it as our own. That opinion, with appropriate deletions and additions,[*] is as follows:
In September 1930, Bela Lugosi and Universal Pictures Company, Inc. (Universal)[1] concluded an agreement for the production of the film Dracula in which Lugosi contracted to and did play the title role. Paragraph 4 of the agreement contained a grant of rights set forth in the footnote.[2]
[Plaintiffs] Hope Linninger Lugosi and Bela George Lugosi, widow and surviving son, respectively, of Bela Lugosi, filed a complaint against Universal on February 3, 1966, alleging that they were the heirs of Bela *817 Lugosi (Lugosi) who died in 1956, and that Universal had, commencing in 1960, appropriated and continued to appropriate property which they had inherited from Lugosi and which was not embraced in paragraph 4 of the agreement with Universal. [Plaintiffs] assert that from 1960 until the present time, Universal entered into many licensing agreements which authorized the licensees to use the Count Dracula character. The licensing agreements executed by Universal list the particular movie and the date of the movie in which Lugosi appeared.
The issue as framed by the trial judge is: "[Plaintiffs] seek to recover the profits made by [Universal] in its licensing of the use of the Count Dracula character to commercial firms and to enjoin [Universal] from making any additional grants, without [their] consent.... The action, therefore, raises the question of whether Bela Lugosi had granted to [Universal] in his contracts with [Universal] merchandising rights in his movie portrayal of Count Dracula, the nature of such rights, and whether any such rights, if retained by Bela Lugosi, descended to the [plaintiffs]...."
The trial court found in pertinent part that "the essence of the thing licensed" by Universal to each of its licensees was the "uniquely individual likeness and appearance of Bela Lugosi in the role of Count Dracula." The finding was based upon uncontradicted evidence that it was Lugosi's likeness that was used in the merchandising of Count Dracula notwithstanding the fact that other actors (Christopher Lee, Lon Chaney and John Carradine) appeared in the Dracula role in other Universal films.
The trial court concluded that: Lugosi during his lifetime had a protectable property or proprietary right in his facial characteristics and the individual manner of his likeness and appearance as Count Dracula; that said property or proprietary right was of such character and substance that it did not terminate with Lugosi's death but descended to his heirs; and that [they] acquired all right, title and interest in and to said property under the will of Lugosi.
[Plaintiffs] recovered a judgment for damages and an injunction. Universal appeals.[3]
*818 Bram Stoker's 1897 novel Dracula has always been in the public domain in the United States.[4] Universal's film Dracula, however, was copyrighted after the studio had purchased the motion picture rights from Florence Stoker, Stoker's heir, and from Hamilton Deane and John Balderston, the authors of the 1927 stage play Dracula. (Lugosi had played Count Dracula in the 1927 Deane-Balderston Broadway play.) The trial court found, notwithstanding Universal's copyright in the film, that the character of Count Dracula as described in Stoker's novel is in the public domain in the United States.
Before discussing the applicable law, it should be noted:
There is no allegation in the complaint, no evidence in the record, and no finding of the court that Lugosi in his lifetime alone or with others used his name and/or likeness as Dracula or otherwise in connection with any business, product or service so as to impress a secondary meaning on such business, product or service.
(1) However, Lugosi could have created during his lifetime through the commercial exploitation of his name, face and/or likeness in connection with the operation of any kind of business or the sale of any kind of product or service a general acceptance and good will for such business, product or service among the public, the effect of which would have been to impress such business, product or service with a secondary meaning, protectable under the law of unfair competition. (Johnston v. 20th Century-Fox Film Corp. (1947) 82 Cal. App. 2d 796, 810 [187 P.2d 474].) The tie-up of one's name, face and/or likeness with a business, product or service creates a tangible and saleable product in much the same way as property may be created by one who organizes under his name a business to build and/or sell houses according to a fixed plan or who writes a book, paints a picture or creates an invention.[5]
The trial court found, and the parties have extensively briefed and argued, that the interest in question is one of "property" as that term is *819 defined in Civil Code section 654. We agree, however, with Dean Prosser who considers a dispute over this question "pointless." (Prosser, Privacy (1960) 48 Cal.L.Rev. 383, 406.) "Once protected by the law, [the right of a person to the use of his name and likeness] ... is a right of value upon which plaintiff can capitalize by selling licenses." (Italics added; Prosser, Law of Torts (4th ed. 1971) p. 807.)
In brief, Lugosi in his lifetime had a right to create in his name and/or likeness "... a right of value," which could have been transmuted into things of value or Lugosi could, if he elected not to exercise such right, protect it from invasion by others by a suit for injunction and/or damages. However, insofar as the record shows, Lugosi had no occasion in his lifetime to sue or restrain anyone because of a purported invasion of his right to commercially exploit his name and likeness.
(2a) Such "... a right of value" to create a business, product or service of value is embraced in the law of privacy and is protectable during one's lifetime but it does not survive the death of Lugosi. (3) "The law of privacy comprises four distinct kinds of invasion of four different interests of the plaintiff, which are tied together by the common name, but otherwise have almost nothing in common except that each represents an interference with the right of the plaintiff, in the phrase coined by Judge Cooley, `to be let alone.' Without any attempt to exact definition, these four torts may be described as follows: [¶] 1. Intrusion upon the plaintiff's seclusion or solitude or into his private affairs. [¶] 2. Public disclosure of embarrassing private facts about the plaintiff. [¶] 3. Publicity which places the plaintiff in a false light in the public eye. [¶] 4. Appropriation, for the defendant's advantage, of the plaintiff's name or likeness." (Italics added, Prosser, Privacy, supra, 48 Cal.L.Rev. 383, 389.)[6]
Assuming arguendo that Lugosi, in his lifetime, based upon publicity he received and/or because of the nature of his talent in exploiting his name and likeness in association with the Dracula character, had established a business under the name of Lugosi Horror Pictures and sold *820 licenses to have "Lugosi as Dracula"[7] imprinted on shirts, and in so doing built a large public acceptance and/or good will for such business, product or service, there is little doubt that Lugosi would have created during his lifetime a business or a property wholly apart from the rights he had granted to Universal to exploit his name and likeness in the characterization of the lead role of Count Dracula in the picture Dracula.
However, even on the above assumption, whether Lugosi's heirs would have succeeded to such property depends entirely on how it was managed before Lugosi died. Lugosi may have sold the property and spent the consideration before he died, or sold it for installment payments and/or royalties due after his death, in which latter event such payments and/or royalties would, of course, be a part of his estate.
"There has ... been a good deal of consistency in the rules that have been applied to the four disparate torts under the common name. As to any of the four, it is agreed that the plaintiff's right is a personal one, which does not extend to members of his family, unless, as is obviously possible, their own privacy is invaded along with his. The right is not assignable, and while the cause of action may or may not survive after his death, according to the survival rules of the particular state, there is no common law right of action for a publication concerning one who is already dead." (Italics added, fns. omitted, Prosser, Law of Torts, supra, pp. 814-815.)
[Although, as we discuss hereafter, the right to exploit one's name or likeness may be assignable,] [] a number of decisions support the italicized conclusion.
In Maritote v. Desilu Productions, Inc. (7th Cir.1965) 345 F.2d 418 [18 A.L.R. 3d 863] (cert. den. 382 U.S. 883 [15 L. Ed. 2d 124, 86 S. Ct. 176], the administratrix of the estate of Al Capone brought an action for unjust enrichment arising out of the defendant's alleged appropriation of the name, likeness and personality of Al Capone. The widow and son of Al Capone brought an action for invasion of their privacy, based on the same appropriation. The plaintiffs argued that the property rights of Al Capone, his name, likeness and personality, did not fall into the public domain upon his death, but passed to his heirs. Defendants *821 argued that the action for unjust enrichment was in essence an action for the invasion of the right of privacy of Al Capone, which could not survive his death. The court agreed with the defendants, holding that the relief sought by the plaintiffs was essentially that of a claimed invasion of a right of privacy, and judgment was entered for the defendants. In support of its position, the court relied upon Dean Prosser's cited article Privacy in 48 Cal.L.Rev. 383.
In Schumann v. Loew's Incorporated (Sup. Ct. 1954) 135 N.Y.S.2d 361, some of the great-grandchildren of composer Robert Schumann brought suit against the defendant for misappropriation of a property right once belonging to the famous composer in the latter's name. Plaintiffs attempted to analogize the property right in a man's name to the right found in real property through citation of cases. In denying recovery to plaintiffs, the court stated: "None of them [cases cited by the plaintiffs] supports plaintiff's contention that a motion picture depicting the life of one who died almost one hundred years earlier is an infringement upon the deceased's property right in his name which descended to his heirs or next of kin." (Schumann v. Loew's Incorporated, supra, at p. 369.)
In James v. Screen Gems, Inc. (1959) 174 Cal. App. 2d 650 [344 P.2d 799], the widow of Jesse James, Jr., brought suit against a film producer of a television show portraying the life of her husband. Both the first and second causes of action alleged that there had been "exploitation of plaintiff's deceased husband's personality and name for commercial purposes." (174 Cal. App.2d at p. 651.) The court treated both causes of action as personal to the deceased so that even if there was an invasion of the right of privacy it was not a right that survived death.
(4) When the right invaded was more strictly the privilege "to be let alone," the courts in this state have refused to extend to the heirs of the (potential) plaintiff the right to recover for the invasion of that right: "It is well settled that the right of privacy is purely a personal one; it cannot be asserted by anyone other than the person whose privacy has been invaded, that is, plaintiff must plead and prove that his privacy has been invaded. (Coverstone v. Davies (1952) 38 Cal. 2d 315, 322-324 [239 P.2d 876]; Werner v. Times-Mirror Co. (1961) 193 Cal. App. 2d 111, 116 [14 Cal. Rptr. 208]; James v. Screen Gems, Inc. (1959) 174 Cal. App. 2d 650, 653 [344 P.2d 799]; Kelly v. Johnson Publishing Co. (1958) 160 Cal. App. 2d 718, 722 [325 P.2d 659]; Metter v. Los Angeles Examiner (1939) 35 Cal. App. 2d 304, 310 [95 P.2d 491]; 4 Witkin, Summary of Cal. Law (8th ed.) Torts, § 342, p. 2605.) Further, the *822 right does not survive but dies with the person." (Hendrickson v. California Newspapers, Inc. (1975) 48 Cal. App. 3d 59, 62 [121 Cal. Rptr. 429].)
There is good reason for the rule. The very decision to exploit name and likeness is a personal one. It is not at all unlikely that Lugosi and others in his position did not during their respective lifetimes exercise their undoubted right to capitalize upon their personalities, and transfer the value thereof into some commercial venture, for reasons of taste or judgment or because the enterprise to be organized might be too demanding or simply because they did not want to be bothered.
It seems to us rather novel to urge that because one's immediate ancestor did not exploit the flood of publicity and/or other evidence of public acceptance he received in his lifetime for commercial purposes, the opportunity to have done so is property which descends to his heirs. Yet [plaintiffs'] claim boils down to this: now that Bela Lugosi is dead, they are the only ones who should have the opportunity to exploit their ancestor's personality.
If the opportunities of a person to exploit a name or likeness in one's lifetime are inheritable property, may it be assumed that if the first heirs thereof, like their immediate ancestor, do not exploit similar opportunities the right to do so is automatically transferred to succeeding heirs? [May the remote descendants of the historic public figures obtain damages for the unauthorized commercial use of the name or likeness of their distinguished ancestors? If not, where is the line to be drawn, and who should draw it? Assuming that some durational limitation would be appropriate, it has been suggested that the adoption of such a limitation would be "beyond the scope of judicial authority," and that "legislative action will be required...." (Note (1978) 29 Hastings L.J. 751, 774; see Maritote v. Desilu Productions, Inc., supra, 345 F.2d 418, 420.) Certainly the Legislature by appropriate amendment to Civil Code section 3344 (see fn. 6, ante), might recognize a right of action on behalf of the family or immediate heirs of persons such as Lugosi. For the reasons stated above, however, we decline to adopt judicially any such rule.
(2b) Thus, under present law,] upon Lugosi's death anyone, related or unrelated to Lugosi, with the imagination, the enterprise, the energy and the cash could, in [his or her] own name or in a fictitious name, or a trade name coupled with that of Lugosi, have impressed a name so selected *823 with a secondary meaning and realized a profit or loss by so doing depending upon the value of the idea, its acceptance by the public and the management of the enterprise undertaken. After Lugosi's death, his name was in the public domain. Anyone, including [plaintiffs], or either of them, or Universal, could use it for a legitimate commercial purpose.
We are not prepared to say, however, that [plaintiffs] or any person other than Universal could have attempted to build a business with a secondary meaning, which business exploited the name Lugosi, and coupled Lugosi's name with that of Dracula. That question is not before us.
The learned trial judge, in holding that the name and likeness are "property" which can pass to the heirs, relied on a line of cases which purport to recognize such a "property right" as opposed to the right of privacy founded in tort (e.g., Haelan Laboratories v. Topps Chewing Gum (2d Cir.1953) 202 F.2d 866; Uhlaender v. Henricksen (D.Minn. 1970) 316 F. Supp. 1277; Cepeda v. Swift and Company (8th Cir.1969) 415 F.2d 1205.)
The question which these cases pose is this: if the right to exploit name and likeness can be assigned because it is a "property" right (Haelan), is there any reason why the same right cannot pass to the heirs?
(5) Assignment of the right to exploit name and likeness by the "owner" thereof is synonymous with its exercise. In all of the above cases the owner of the right did assign it in his lifetime and, too, Lugosi did precisely this in his lifetime when he assigned his name and likeness to Universal for exploitation in connection with the picture Dracula. (Ante, fn. 2.) Assertion by the heirs of the right to exploit their predecessor's name and likeness to commercial situations he left unexploited simply is not the exercise of that right by the person entitled to it.[8] Thus, whether or not the right sounds in tort or property, and we think *824 with Dean Prosser that a debate over this issue is pointless, what is at stake is the question whether this right is or ought to be personal.
(6) The so-called right of publicity means in essence that the reaction of the public to name and likeness, which may be fortuitous or which may be managed or planned, endows the name and likeness of the person involved with commercially exploitable opportunities. The protection of name and likeness from unwarranted intrusion or exploitation is the heart of the law of privacy.
If rights to the exploitation of artistic or intellectual property never exercised during the lifetime of their creators were to survive their death, neither society's interest in the free dissemination of ideas nor the artist's rights to the fruits of his own labor would be served. Authority, as noted, supports the strong policy considerations which underline the conclusion that the right is personal.
(2c) We hold that the right to exploit name and likeness is personal to the artist and must be exercised, if at all, by him during his lifetime. [End of Court of Appeal opinion.]
The judgment is reversed and the trial court is directed to enter a new judgment in favor of Universal for its costs. Plaintiffs' cross-appeal is dismissed as moot. Universal shall recover its costs of appeal.
MOSK, J.
With the majority of my colleagues I concur in the judgment, and in the opinion of Presiding Justice Roth. Because this is a matter of first impression in our court, I am impelled to add some observations.
Factually and legally this is a remarkable case. Factually: not unlike the horror films that brought him fame, Bela Lugosi rises from the grave 20 years after death to haunt his former employer. Legally: his vehicle is a strained adaptation of a common law cause of action heretofore unknown either in a statute or case law in California.
The plaintiffs, and my dissenting colleagues, erroneously define the fundamental issue, and consistently repeat their misconception. We are not troubled by the nature of Lugosi's right to control the commercial exploitation of his likeness. That right has long been established. (Haelen Laboratories v. Topps Chewing Gum (2d Cir.1953) 202 F.2d 866, 868; Cepeda v. Swift and Company (8th Cir.1969) 415 F.2d 1205, *825 1206; Uhlaender v. Henricksen (D.Minn. 1970) 316 F. Supp. 1277, 1282.) The issue here is the right of Lugosi's successors to control the commercialization of a likeness of a dramatic character i.e., Count Dracula created by a novelist and portrayed for compensation by Lugosi in a film version produced by a motion picture company under license from the successor of the novelist. The error in discerning the problem pervades the trial court's conclusion. Inevitably one who asks the wrong question gets the wrong answer.
Bela Lugosi was a talented actor. But he was an actor, a practitioner of the thespian arts; he was not a playwright, an innovator, a creator or an entrepreneur. As an actor he memorized lines and portrayed roles written for him, albeit with consummate skill. In this instance the part he played was that of Count Dracula, a legendary character out of the novel originated by Bram Stoker,[1] first published in England in 1897, and adapted for the screen by writers employed by Universal Pictures. Due to copyright omission, at all times involved herein the novel and its characters had been in the American public domain.
Merely playing a role under the foregoing circumstances creates no inheritable property right in an actor, absent a contract so providing. Indeed, as the record discloses, many other actors have portrayed the same role, notably Lon Chaney and John Carradine; the first movie was a European version released in 1922 with Max Schreck as the Count. Thus neither Lugosi during his lifetime nor his estate thereafter owned the exclusive right to exploit Count Dracula any more than Gregory Peck possesses or his heirs could possess common law exclusivity to General MacArthur, George C. Scott to General Patton, James Whitmore to Will Rogers and Harry Truman, or Charlton Heston to Moses.
I do not suggest that an actor can never retain a proprietary interest in a characterization. An original creation of a fictional figure played exclusively by its creator may well be protectible. (Goldstein v. California (1973) 412 U.S. 546 [37 L. Ed. 2d 163, 93 S. Ct. 2303].) Thus Groucho Marx just being Groucho Marx, with his moustache, cigar, slouch and leer, cannot be exploited by others. Red Skelton's variety of self-devised roles would appear to be protectible, as would the unique *826 personal creations of Abbott and Costello, Laurel and Hardy and others of that genre. Indeed the court in a case brought by the heirs of Stanley Laurel and Oliver Hardy (Price v. Hal Roach Studios, Inc. (S.D.N.Y. 1975) 400 F. Supp. 836) observed at page 845: "we deal here with actors portraying themselves and developing their own characters...."
Here it is clear that Bela Lugosi did not portray himself and did not create Dracula, he merely acted out a popular role that had been garnished with the patina of age, as had innumerable other thespians over the decades. His performance gave him no more claim on Dracula than that of countless actors on Hamlet who have portrayed the Dane in a unique manner.
Unquestionably an inheritable property right can be either created or eliminated by contract. There was an employment contract here giving Universal the right to exploit "any and all of the artist's acts, poses, plays and appearances." Whether the contractual right was intended to be limited to exploitation of the presentation of the photoplay is disputed by the parties. To resolve that conflict and ambiguities in the contract we should turn either to expert testimony concerning custom of the industry none was admitted here or to the law. Fortunately the Legislature has given us guidance.
In the absence of precise provisions of a contract to the contrary, Labor Code section 2860 (formerly Civ. Code, § 1985) must be read into every employment relationship. The statute provides: "Everything which an employee acquires by virtue of his employment, except the compensation which is due to him from his employer, belongs to the employer, whether acquired lawfully or unlawfully, or during or after the expiration of the term of his employment."
The foregoing principle has been universally accepted. In Zahler v. Columbia Pictures Corp. (1960) 180 Cal. App. 2d 582 [4 Cal. Rptr. 612], the heirs of a musical composer sued for damages when music written under contract to a film studio as a motion picture background was subsequently transferred to and used by a television station. Said the court at page 589: "where an employee creates something as part of his duties under his employment, the thing created is the property of his employer...." Similarly in Treu v. Garrett Corp. (1968) 264 Cal. App. 2d 432, 436 [70 Cal. Rptr. 284], an invention created by an employee was held to belong to the employer because that was the very reason he "was hired and paid."
*827 By parity of reasoning, Lugosi, the employee, was hired and paid handsomely, circa 1931 by Universal, the employer, to create a version of Count Dracula in a motion picture. The product of that employment and all the residuals flowing therefrom belong, under the legislative enactment, to the employer. Had the employee desired to withhold any effects of the employment from exploitation by the employer, he could have so provided in the agreement. There is no exclusion in the instant employment contract.
To the same effect is Famous Players-Lasky Corp. v. Ewing (1920) 49 Cal. App. 676 [194 P. 65]. There an electrical device was conceived by the motion picture studio employer, but the originality and unique skill in inventing the actual lights was that of the employee-electrician. The court held that despite the manual dexterity and creative skill of the employee, the product belonged to the employer. Again the analogy is clear to the instant case: Universal as employer conceived the use of Dracula as a motion picture and acquired the rights thereto from the successor of the author; Lugosi as employee was hired to and did apply his creative skill to performing in the film. As in Famous Players-Lasky, the product and all the rights flowing therefrom belong to the employer.
Finally, I must comment briefly on the problems my dissenting colleagues face when they attempt to determine the temporal limitations of their version of the right of publicity. May the descendants of George Washington sue the Secretary of the Treasury for placing his likeness on the dollar bill? May the descendants of Abraham Lincoln obtain damages for the commercial exploitation of his name and likeness by the Lincoln National Life Insurance Company or the Lincoln division of the Ford Motor Company? May the descendants of James and Dolly Madison recover for the commercialization of Dolly Madison confections?
Although conceding it is inherently a policy decision, and without statutory guidance or case authority, the dissent by mere ipse dixit selects the copyright period, i.e., the author's life plus 50 years.
I suggest that if the copyright statute can be adapted to an artistic or literary creation where there is no actual recorded American copyright, then all rights to exploitation of Dracula would have been vested not in Lugosi and his heirs but in the author, Bram Stoker. Parenthically, Stoker retained a copyright protection abroad, and his book did not fall *828 into the public domain in England and in countries adhering to the Berne Convention until April of 1962. This was, of course, long after Lugosi's performances for Universal. While Universal protected itself by contracting in 1930 with Florence Stoker, Bram Stoker's successor, and with the playwrights who adapted the Broadway theatrical version of Dracula, if Lugosi had attempted to exploit Dracula in 1948, 1931, or 1936, he would have been liable in damages to the Stoker estate. The heirs should have no greater rights now than Lugosi would have had in his lifetime.
A salutary tendency today is to encourage the free dissemination of ideas political, literary, artistic even by commercial sources. (See, e.g., Sears, Roebuck & Co. v. Stiffel Co. (1964) 376 U.S. 225, 231 [11 L. Ed. 2d 661, 666-667, 84 S. Ct. 784].) If Bela Lugosi were alive today, he would be unable to claim an invasion of his right to privacy for Universal's exploitation not of Lugosi qua Lugosi but of products created in the image of Count Dracula, a role Lugosi played. On a right of privacy theory his successors concededly would be denied the substantial rewards they neither earned nor otherwise deserved two decades after Lugosi's death. To approve such a bonanza on a newly created cause of action, heretofore unknown in California, ill serves the principles of free expression and free enterprise.
I agree with the Court of Appeal that we must reverse the judgment.
BIRD, C.J.
I respectfully dissent.
Although Bela Lugosi died more than 20 years ago, his name still evokes the vivid image of Count Dracula, a role he played on stage and in motion pictures. So impressed in the public's memory, the image of Lugosi as Dracula was profitably marketed by defendant Universal Pictures, which had employed Lugosi to portray Count Dracula in the motion picture Dracula. Specifically, Universal Pictures concluded licensing agreements which authorized the use of Lugosi's likeness in his portrayal of Count Dracula in connection with the sale of numerous commercial merchandising products.
Plaintiffs, beneficiaries under Bela Lugosi's will, commenced this action for damages and an injunction against further licensing of Lugosi's likeness on the ground that such use was unauthorized and infringed on their interest in controlling the commercial use of Lugosi's likeness. This case thus presents the novel question in California of the nature *829 and scope of an individual's interest in controlling the commercial exploitation of his or her likeness. I conclude that Universal Picture's licensing of Lugosi's image was unauthorized and infringed on Lugosi's proprietary interest in his likeness. Since that interest is inheritable, the trial court correctly held that plaintiffs are entitled to damages and injunctive relief.
I. THE FACTS
Bela Lugosi (Lugosi) and defendant, Universal Pictures (Universal), entered into a series of agreements relating to Lugosi's portrayal of the character Count Dracula.[1] Under an employment contract dated September 11, 1930, Lugosi agreed to play the part of Count Dracula in the motion picture Dracula,[2] which was released by Universal in 1931. In connection with the execution of another employment contract in February 1936, Universal obtained Lugosi's written permission to use in the motion picture Dracula's Daughter a wax image of Lugosi's face and head as Count Dracula. This bust was a representation of Lugosi's appearance in Dracula. In 1948, Lugosi again agreed to play Count Dracula in the Universal motion picture Abbott and Costello Meet Frankenstein.[3]
In 1960, four years after Lugosi's death, Universal began to enter into licensing agreements with various businesses for the use of the Count Dracula character in connection with certain commercial merchandising products. By 1966, when this action was filed, Universal had concluded approximately 50 such licensing agreements. The agreements authorized the use of the likeness of Count Dracula in connection with the sale of such products as plastic toy pencil sharpeners, plastic model figures, T-shirts and sweat shirts, card games, soap and detergent products, picture puzzles, candy dispensers, masks, kites, belts and belt buckles, and beverage stirring rods.
*830 The licenses granted by Universal specifically authorized the use of Lugosi's likeness from his portrayal of Count Dracula in Dracula and Dracula's Daughter. No agreement made reference to any other actor's portrayal of Count Dracula. Nearly all of these agreements also granted merchandising rights in other horror film characters.[4] The agreements provided that Universal had the right to license the commercial use of the names, characteristics, and images of all these characters. However, the licensee was precluded from using the name of the actor who played each character in its commercial activities.
Plaintiffs, Lugosi's surviving son and widow, learned of the commercial use of Lugosi's likeness in his portrayal of Count Dracula in April 1963. They filed suit in August 1963 seeking damages and injunctive relief on the ground that licensing his likeness was unauthorized and infringed on a valuable property right, the commercial value of Lugosi's likeness. Universal moved to dismiss the complaint on the ground that Lugosi's estate was the proper plaintiff. Plaintiffs were subsequently granted a voluntary dismissal without prejudice so that Lugosi's estate could be reopened to determine the distribution of property not considered in the earlier decree of distribution. In 1966, after plaintiffs had been awarded all causes of action belonging to the estate, the present action was filed.
The trial court concluded that the essence of Lugosi's portrayal of Count Dracula was found in his "facial characteristics and in the uniquely individual manner of his likeness and appearance." The court further found that Universal had not granted its licensees the right to use a likeness of a Count Dracula character generally consistent with the character described in the novel Dracula. Rather, Universal had licensed the "uniquely individual likeness and appearance" of Lugosi in his portrayal of Count Dracula.
The trial court held that Universal had no contractual right to license such use. A grant-of-rights provision in the 1930 contract was interpreted to authorize Universal to photograph and record Lugosi's portrayal of Count Dracula in Dracula, to distribute the resulting motion picture, and to publicize Lugosi's name, likeness, acts and appearances in connection with advertising the motion picture. (See post, fn. 37.) However, Universal's commercial licensing agreements were found to *831 have been completely separate and apart from any advertising concerning the re-release of Dracula to movie theaters or its broadcast on television. Further, the trial court concluded that Lugosi did not otherwise grant to Universal the right to exploit his portrayal of Count Dracula in connection with the sale of commercial products.[5]
Lugosi was found to have a protectible proprietary interest in the commercial use of his likeness and appearance, independent of the protection afforded by the common law right of privacy. This protection extended to Lugosi's likeness in his distinctive portrayal of Count Dracula. This proprietary right did not terminate upon Lugosi's death but descended to his beneficiaries, plaintiffs. Since neither Lugosi nor plaintiffs had authorized Universal to license the use of Lugosi's likeness in his portrayal of Count Dracula, such use constituted a tortious interference with plaintiffs' interests, entitling plaintiffs to recover damages.
The trial court found that the applicable statute of limitations for the appropriation of a protectable proprietary interest was two years (Code Civ. Proc., § 339, subd. 1), and that each license, and each renewal or extension thereof, constituted a separate tort. Therefore, plaintiffs were entitled to damages for each license agreement or renewal thereof executed or commenced within two years of the filing of this action on February 3, 1966.[6] The initiation of the present action, rather than the filing of plaintiffs' suit in August 1963, was found to be the critical date for measuring the recovery period since the present action was not considered a continuation of the 1963 lawsuit.
In connection with the approximately 35 licensing agreements for which recovery was not barred by the statute of limitations, Universal received more than $260,000 in royalties. After considering detailed evidence on the proportion of that amount which resulted from licensing the use of Lugosi's likeness as compared to other characters and on the extent of Universal's expenses, the trial court awarded plaintiffs $53,023.23 in damages. Plaintiffs were also awarded prejudgment interest on this amount from January 1, 1969, the "mid-point of defendant's *832 infringement." (See Civ. Code, § 3288.) The court further permanently enjoined Universal and its affiliated and/or related corporations from making or entering into any contract or license agreement which grants, authorizes, permits or licenses the use of Lugosi's name, likeness or appearance in his portrayal of Count Dracula in connection with the sale or advertisement of any commercial merchandising product. The injunction does not apply to either the exhibition of the motion pictures produced by Universal in which Lugosi appeared as Count Dracula or to the dissemination or broadcast of any biographical information about Lugosi.[7]
Universal appeals from this judgment, presenting a multifaceted attack on the trial court's findings. Plaintiffs cross-appeal, asserting that the present action should be considered a continuation of the lawsuit filed in 1963 for purposes of calculating the effect of the statute of limitations.
II. THE RIGHT OF PUBLICITY
The fundamental issue in this case is the nature of Lugosi's right to control the commercial exploitation of his likeness. The trial court found Universal's licensing agreements constituted a tortious interference with Lugosi's proprietary or property interest in the commercial *833 use of his likeness, an interest which had descended to plaintiffs. Universal asserts that Lugosi's interest is protected only under the rubric of the right of privacy. Since that right is personal and ceased with Lugosi's death, plaintiffs cannot recover damages based on Universal's conduct.[8] Acordingly, the critical question is whether an individual's interest in the commercial use of his likeness is protected solely as an aspect of the right of privacy or whether additional or alternative protection exists.
A. PRIVACY OR PUBLICITY
The common law right of privacy creates a cause of action for "an interference with the right of the plaintiff ... `to be let alone.'" (Prosser, Privacy (1960) 48 Cal.L.Rev. 383, 389.)[9] "The gist of the cause of action in a privacy case is ... a direct wrong of a personal character resulting in injury to the feelings ... of the individual.... The injury is mental and subjective. It impairs the mental peace and comfort of the person and may cause suffering much more acute than that caused by a bodily injury." (Fairfield v. American Photocopy Equipment Co. (1955) 138 Cal. App. 2d 82, 86-87 [291 P.2d 194]. See Gill v. Curtis Publishing Co. (1952) 38 Cal. 2d 273, 276-278 [239 P.2d 630]; Hofstadter & Horowitz, The Right of Privacy (1964) § 1.1; Warren & Brandeis, The Right to Privacy (1890) 4 Harv.L.Rev. 193.) Since the right of privacy developed to protect an individual from certain injuries to his feelings and assaults on his peace of mind, he need not suffer any injury to his property, business or economic interests as a prerequisite to initiating a suit for an invasion of privacy. (Fairfield v. American Photocopy Equipment Co., supra, 138 Cal. App.2d at p. 86.)
*834 The appropriation of an individual's likeness for another's commercial advantage often intrudes on interests distinctly different than those protected by the right of privacy. Plaintiffs in this case have not objected to the manner in which Universal used Lugosi's likeness nor claimed any mental distress from such use. Rather, plaintiffs have asserted that Universal reaped an economic windfall from Lugosi's enterprise to which they are rightfully entitled.
Today, it is commonplace for individuals to promote or advertise commercial services and products or, as in the present case, even have their identities infused in the products. Individuals prominent in athletics, business, entertainment and the arts, for example, are frequently involved in such enterprises. When a product's promoter determines that the commercial use of a particular person will be advantageous, the promoter is often willing to pay handsomely for the privilege. As a result, the sale of one's persona in connection with the promotion of commercial products has unquestionably become big business. (See Note, Lugosi v. Universal Pictures: Descent of the Right of Publicity (1978) 29 Hastings L.J. 751; Nimmer, The Right of Publicity (1954) 19 Law & Contemp. Prob. 203, 204, 215-216; Treece, Commercial Exploitation of Names, Likenesses, and Personal Histories (1973) 51 Tex. L. Rev. 637, 646.)
Such commercial use of an individual's identity is intended to increase the value or sales of the product by fusing the celebrity's identity with the product and thereby siphoning some of the publicity value or good will in the celebrity's persona into the product. This use is premised, in part, on public recognition and association with that person's name or likeness, or an ability to create such recognition. The commercial value of a particular person's identity thus primarily depends on that person's public visibility and the characteristics for which he or she is known. (Uhlaender v. Hendricksen (D.Minn. 1970) 316 F. Supp. 1277, 1283.)
Often considerable money, time and energy are needed to develop one's prominence in a particular field. Years of labor may be required before one's skill, reputation, notoriety or virtues are sufficiently developed to permit an economic return through some medium of commercial promotion. (See Rosemont Enterprises, Inc. v. Urban Systems, Inc. (1973) 72 Misc. 2d 788 [340 N.Y.S.2d 144, 146], affd. as mod. 42 App.Div.2d 544 [345 N.Y.S.2d 17]; Nimmer, supra, 19 Law *835 & Contemp. Prob. at p. 216.) For some, the investment may eventually create considerable commercial value in one's identity.
In this context, the marketable product of that labor is the ability of a person's name or likeness to attract the attention and evoke a desired response in a particular consumer audience. That response is a kind of good will or recognition value generated by that person. (See Ali v. Playgirl, Inc. (S.D.N.Y. 1978) 447 F. Supp. 723, 728-729; Grant v. Esquire, Inc. (S.D.N.Y. 1973) 367 F. Supp. 876, 879.) While this product is concededly intangible, it is not illusory.
An unauthorized commercial appropriation of one's identity converts the potential economic value in that identity to another's advantage. The user is enriched, reaping one of the benefits of the celebrity's investment in himself. (See Palmer v. Schonhorn Enterprises, Inc. (1967) 96 N.J. Super. 72 [232 A.2d 458, 462]; Kalven, Privacy in Tort Law Were Warren and Brandeis Wrong? (1966) 31 Law & Contemp. Prob. 326, 331.) The loss may well exceed the mere denial of compensation for the use of the individual's identity. The unauthorized use disrupts the individual's effort to control his public image, and may substantially alter that image. The individual may be precluded from future promotions in that as well as other fields. Further, while a judicious involvement in commercial promotions may have been perceived as an important ingredient in one's career, uncontrolled exposure may be dysfunctional. As a result, the development of his initial vocation his profession may be arrested. (See Treece, supra, 51 Texas L.Rev. at pp. 642-646.) Finally, if one's identity is exploited without permission to promote products similar to those which the individual has already endorsed, the unauthorized use resembles unfair competition. While the product which first used the celebrity paid for the privilege of trading on his publicity value, the second product has secured a costless endorsement. The simultaneous presence in the market of these competing products may cause the latter to be mistaken for the former and will probably diminish the value of the endorsement. (See Factors Etc., Inc. v. Creative Card Co. (S.D.N.Y. 1977) 444 F. Supp. 279, 283.)
Accordingly, the gravamen of the harm flowing from an unauthorized commercial use of a prominent individual's likeness[10] in most cases *836 is the loss of potential financial gain, not mental anguish. (See Motschenbacher v. R.J. Reynolds Tobacco Co. (9th Cir.1974) 498 F.2d 821, 824; Prosser, supra, 48 Cal.L.Rev. at p. 406; Comment, Transfer of the Right of Publicity: Dracula's Progency and Privacy's Stepchild (1975) 22 UCLA L.Rev. 1103, 1104, fn. 8.)[11] The fundamental objection is not that the commercial use is offensive, but that the individual has not been compensated. Indeed, the representation of the person will most likely be flattering, since it is in the user's interest to project a positive image. The harm to feelings, if any, is usually minimal. (See Note, Zacchini v. Scripps-Howard Broadcasting Company: Media Appropriation, the First Amendment and State Regulation (1977) Utah L.Rev. 817, 818-819.)
The individual's interest thus threatened by most unauthorized commercial uses is significantly different than the personal interests protected under the right of privacy. Recognition of this difference has prompted independent judicial protection for this economic interest. The individual's interest in the commercial value of his identity has been regarded as proprietary in nature[12] and sometimes denominated a common law "right of publicity."[13] This right has won increasing judicial recognition,[14] as well as endorsements by legal *837 commentators.[15]
The right of publicity has been regarded as "the right of each person to control and profit from the publicity values which he has created or purchased." (Nimmer, supra, 19 Law & Contemp. Prob. at p. 216. See Note, supra, 25 UCLA L.Rev. at p. 1097.) "The distinctive aspect of the common law right of publicity is that it recognizes the commercial value of the picture or representation of a prominent person or performer, and protects his proprietary interest in the profitability of his public reputation or `persona.'" (Ali v. Playgirl, Inc., supra, 447 F. Supp. at p. 728.) Two leading decisions are illustrative.
*838 In Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc., supra, 202 F.2d 866, plaintiff, which had an exclusive contract with a baseball player to use the player's photograph in connection with the sale of plaintiff's chewing gum, sued to prevent defendant's similar use of the player's photograph. The viability of plaintiff's lawsuit depended on the court's determination of the player's interest in his own likeness: if the player's interest consisted only of the right of privacy, plaintiff could not maintain its action since the player's right was incapable of assignment.
Applying New York law, the federal court of appeals found that in addition to a statutory right to privacy, each person had an enforceable right in the publicity value of his photograph, a "right of publicity." Unlike the personal right of privacy, such interest could be transferred "`in gross,' i.e., without any accompanying transfer of a business or of anything else.... [¶] ... For it is common knowledge that many prominent persons (especially actors and ball-players), far from having their feelings bruised through public exposure of their likenesses, would feel sorely deprived if they no longer received money for authorizing advertisements, popularizing their countenances, displayed in newspapers, magazines, busses, trains and subways. This right of publicity would usually yield them no money unless it could be made the subject of an exclusive grant which barred any other advertiser from using their pictures." (Id., at p. 868.) Accordingly, the court held that plaintiff's claim had been improperly dismissed.
Price v. Hal Roach Studios, Inc. (S.D.N.Y. 1975) 400 F. Supp. 836 involved a controversy remarkably similar to the present case. Plaintiffs were the widows of Stanley Laurel and Oliver Hardy (Laurel and Hardy) and a corporation with a contract for the exclusive right to use and merchandise Laurel's and Hardy's names, likenesses and characterizations. Plaintiffs alleged that defendants, owners of the copyright to certain Laurel and Hardy motion pictures, had misappropriated the names and likenesses of the two deceased comedians for commercial merchandising purposes. The court, citing Haelan, held that Laurel and Hardy had had a property right in the use of their names and likenesses during their lifetimes completely separate from the right of privacy. Further, their right of publicity was held to descend to their respective wives upon death, without regard to whether either exploited his right to publicity during his lifetime. (Id., at pp. 843-844, 846.)[16] Accordingly, *839 notwithstanding defendants' interest in certain Laurel and Hardy motion pictures, plaintiffs were held to be entitled to damages and injunctive relief for defendants' unauthorized commercial use of Laurel's and Hardy's rights of publicity.
Underlying these decisions is a recognition that each person has a "right to enjoy the fruits of his own industry," the right to decide how and when the commercial value in his identity will be exploited. (Uhlaender v. Hendricksen, supra, 316 F. Supp. at p. 1282. See Nimmer, supra, 19 Law & Contemp. Prob. at p. 216; Note, supra, 1977 Utah L.Rev. at p. 818.)[17] When one makes an unauthorized use of another's identity for his own commercial advantage, he is unjustly enriched, having usurped both profit and control of that individual's public image.[18]
Further, there is a broader social objective implicit in according judicial protection to the right of publicity, analogous to the policies underlying copyright and patent law. The Supreme Court recently described the purpose of granting copyright protection as encouraging "people to devote themselves to intellectual and artistic creation ...," and thereby secure the benefits of such labors for the entire society. *840 (Goldstein v. California (1973) 412 U.S. 546, 555 [37 L. Ed. 2d 163, 173, 93 S. Ct. 2303]. See 1 Nimmer on Copyright (1978) § 1.03[A].) Similarly, providing legal protection for the economic value in one's identity against unauthorized commercial exploitation creates a powerful incentive for expending time and resources to develop the skills or achievements prerequisite to public recognition and assures that the individual will be able "to reap the reward of his endeavors...." (Zacchini v. Scripps-Howard Broadcasting Co., supra, 433 U.S. at p. 573 [53 L.Ed.2d at p. 975].) While the immediate beneficiaries are those who establish professions or identities which are commercially valuable, the products of their enterprise are often beneficial to society generally. Their performances, inventions and endeavors enrich our society, while their participation in commercial enterprises may communicate valuable information to consumers. (See id., at pp. 576-577 [53 L.Ed.2d at pp. 976-977]; Note, supra, 29 Hastings L.J. at pp. 767-768; Note, Human Cannonballs and the First Amendment: Zachini v. Scripps-Howard Broadcasting Co. (1978) 30 Stan.L.Rev. 1185, 1186, fn. 7.)[19]
The reasons for affording independent protection for the economic value in one's identity are substantial and compelling, as attested by the increasing number of jurisdictions which have done so. (See fn. 14, ante.)[20] I am similarly persuaded that an individual's right of publicity *841 is entitled to the law's protection.[21]
The common law can readily accommodate judicial recognition of the right of publicity. "`The rules of the common law are continually changing and expanding with the progress of the society in which it prevails. It does not lag behind, but adapts itself to the conditions of the present so that the ends of justice may be reached.'" (Johnston v. 20th Century-Fox Film Corp. (1947) 82 Cal. App. 2d 796, 815 [187 P.2d 474].) Specifically, this court has long recognized that the concept of "property" is not static but changes to accommodate creative developments and novel legal relationships.[22] For example, courts have recognized protectible interests in trademarks (Derringer v. Plate (1865) 29 Cal. 292, 294-295; Hall v. Holstrom (1930) 106 Cal. App. 563, 568 [289 P. 668]), titles of literary works (Jackson v. Universal International Pictures, Inc. (1950) 36 Cal. 2d 116 [222 P.2d 433]; Johnston v. 20th *842 Century-Fox Films Corp., supra, 82 Cal. App. 2d 796), the collection and dissemination of news (International News Service v. Associated Press (1918) 248 U.S. 215 [63 L. Ed. 211, 39 S. Ct. 68, 2 A.L.R. 293]), and ideas communicated in confidence or in reasonable expectation of consideration (see Davies v. Krasna (1975) 14 Cal. 3d 502, 506, fn. 3 [121 Cal. Rptr. 705, 535 P.2d 1161, 79 A.L.R. 3d 807] [cases collected]; Components For Research, Inc. v. Isolation Products, Inc. (1966) 241 Cal. App. 2d 726, 730 [50 Cal. Rptr. 829]). The right of publicity is entitled to similar treatment.[23] (See Nimmer, supra, 19 Law & Contemp. Prob. at p. 223.)
*843 Universal argues that judicial recognition of an independent right of publicity is unnecessary in light of the adequate protection afforded under the common law right of privacy. However, the interest at stake in most commercial appropriation cases is ill-suited to protection under the umbrella of the right of privacy. First, the raison d'etre of the common law right of privacy is protection against assaults on one's feelings; an unauthorized commercial appropriation usually precipitates only economic loss, not mental anguish.[24] Second, since the representation of the individual is often flattering, substantial linguistic acrobatics are required to construct a privacy claim on the ground that the use is offensive to a reasonable person. (See Note, supra, 1977 Utah L.Rev. at pp. 818-819. Cf. Briscoe v. Reader's Digest Association, Inc., supra, 4 Cal.3d at pp. 541, 543.) Third, if information about a person is already in the public domain, there can be no claim for an invasion of privacy; to that extent, the right of privacy has been waived. Yet it is publicity which frequently creates value in the individual's identity. To deny a claim for damages for commercial misappropriation because the claimant is prominent is to deny the right to the very individuals to whom the right is most valuable.[25] Fourth, if treated as an aspect of privacy, the use of one's identity for commercial purposes may not be assigned because privacy is a personal, nonassignable right. (See fn. 8, ante.) Such a limitation precludes transferring this economic interest, thereby substantially diminishing its value. (See Nimmer, supra, 19 Law & Contemp. Prob. at pp. 209-210; Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc., supra, 202 F.2d at p. 868.) In short, conforming a claim for the misappropriation of the commercial value in one's identity to the requirements of the right of privacy requires a procrustean jurisprudence.
*844 B. THE SCOPE OF THE RIGHT OF PUBLICITY
The parameters of the right of publicity must now be considered. This case presents two questions: (1) whether the right extends to the likeness of an individual in his portrayal of a fictional character; and (2) whether the right dies with the individual or may be passed to one's heirs or beneficiaries.
Because the right protects against the unauthorized commercial use of an individual's identity, the right clearly applies to the person's name and likeness. However, such protection would appear to be insufficient because many people create public recognition not only in their "natural" appearance but in their portrayal of particular characters. Charlie Chaplin's Little Tramp, Carroll O'Connor's Archie Bunker and Flip Wilson's Judge and Geraldine exemplify such creations. Substantial publicity value exists in the likeness of each of these actors in their character roles. The professional and economic interests in controlling the commercial exploitation of their likenesses while portraying these characters are identical to their interests in controlling the use of their own "natural" likenesses. Indeed, to the extent one's professional endeavors have focused on the development of one or more particular character images, protection for one's likeness in the portrayal of those characters may well be considerably more important than protection for the individual's "natural" appearance. Hence, there appears to be no reason why the right of publicity should not extend to one's own likeness while portraying a particular fictional character.[26]
Lugosi's likeness in his portrayal of Count Dracula is clearly such a case. Many men have portrayed Count Dracula in motion pictures and on stage. However, the trial court found that Universal did not license the use of an undifferentiated Count Dracula character, but the distinctive and readily recognizable portrayal of Lugosi as the notorious Translyvanian count. Universal thereby sought to capitalize on the particular image of Lugosi in this portrayal of Count Dracula and the *845 public recognition generated by his performance. Such use is illustrative of the very interests the right of publicity is intended to protect. Hence, Lugosi had a protectible property interest in controlling unauthorized commercial exploitation of his likeness in his portrayal of Count Dracula.
Recognizing Lugosi's legitimate interest in controlling the use of his portrayal of Count Dracula limits neither the author's exploitation of the novel Dracula[27] nor Universal's use of its copyrighted motion picture. Lugosi only agreed to allow Universal to make limited use of his likeness in their 1930 contract. Further, Lugosi's right certainly does not prohibit others from portraying the character Count Dracula. Consequently, nothing established herein suggests that any of the individuals involved in contemporary cinematic or theatrical revivals of Count Dracula's nocturnal adventures have violated Lugosi's right of publicity. The only conduct prohibited is the unauthorized commercial use of Lugosi's likeness in his portrayal of Count Dracula. To the extent that Universal or another seeks such use, that right can be secured by contract.[28]
The right of publicity protects the intangible proprietary interest in the commercial value in one's identity. Like other intangible property rights, its value often cannot be reaped if the individual may not transfer all or part of that interest to another for development. Indeed, an exclusive grant of publicity rights may be required before an attempt to use or promote that person's likeness will be undertaken. Since it is clear that the right of publicity is hardly viable unless assignable, I agree with the numerous authorities that have recognized the right is capable of assignment.[29]
*846 It is equally clear that the right may be passed to one's heirs or beneficiaries upon the individual's death. In considering the question of the right's descendibility, it must be remembered that what is at issue is the proprietary interest in the value of one's name and likeness in commercial enterprises, not a personal right like the right of privacy. No policy has been suggested which persuades me that the right of publicity "... should not descend at death like any other intangible property right." (Factors Etc., Inc. v. Creative Card Co., supra, 444 F. Supp. at p. 284.) Further, as with copyright protection, granting protection after death provides an increased incentive for the investment of resources in one's profession, which may augment the value of one's right of publicity. If the right is descendible, the individual is able to transfer the benefits of his labor to his immediate successors and is assured that control over the exercise of the right can be vested in a suitable beneficiary. "There is no reason why, upon a celebrity's death, advertisers should receive a windfall in the form of freedom to use with impunity the name or likeness of the deceased celebrity who may have worked his or her entire life to attain celebrity status. The financial benefits of that labor should go to the celebrity's heirs...." (Note, supra, 42 Brooklyn L.Rev. at p. 547.)[30]
However, encouraging the investment of resources in activities and careers from which publicity values arise and providing protection for the resulting proprietary interest does not necessitate perpetual protection for the right of publicity. Assurance that one's immediate family and successors will be entitled to the residual value of one's right of publicity after death is a sufficient incentive. Further, recognition of the right of publicity is premised in part on an individual's interest in controlling the manner in which he or she is commercially exploited, so that such use furthers rather than undermines his or her professional *847 activities. With death, the individual's need to control the commercial uses of his identity as an adjunct to his career ceases. Providing legal protection long after death basically serves to protect the continuing exploitation of the right, a protection which may already be available under the theory of unfair competition. (See maj. opn., ante, pp. 818-819. See generally, Fields, What's in a Stage Name? (1962) 35 So. Cal.L.Rev. 149, 149-154.) Finally, with the passage of time, an individual's identity is woven into the fabric of history, as a heroic or obscure character of the past. In that sense, the events and measures of his life are in the public domain and are questionably placed in the control of a particular descendent.
The fixing of the precise date for the termination of the right of publicity is inherently a policy decision, one that the Legislature may be best able to determine. However, in the absence of legislative action, a limit must be prescribed. In fashioning common law rights and remedies in the past, this court has often considered federal and state statutory schemes for guidance. (See, e.g., In re Waltreus (1965) 62 Cal. 2d 218, 224 [42 Cal. Rptr. 9, 397 P.2d 1001]; Estate of Mason (1965) 62 Cal. 2d 213, 217 [42 Cal. Rptr. 13, 397 P.2d 1005].) Since the right of publicity recognizes an interest in intangible property similar in many respects to creations protected by copyright law (Zacchini v. Scripps-Howard Broadcasting Co., supra, 433 U.S. at p. 573 [53 L.Ed.2d at p. 975]), that body of law is instructive.
The Copyright Act of 1976 (17 U.S.C. § 101 et seq.) provides that a copyright in new works shall be recognized during the author's life and for 50 years thereafter. (17 U.S.C. § 302 (a).) That period represents a reasonable evaluation of the period necessary to effect the policies underlying the right of publicity. Therefore, I would hold that the right of publicity should be recognized during the subject's life and for 50 years thereafter. (See Comment, supra, 22 UCLA L.Rev. at pp. 1124-1128; Note, supra, 29 Hastings L.J. at p. 773. Cf. Nimmer, Does Copyright Abridge the First Amendment Guarantees of Free Speech and Press? (1970) 17 UCLA L.Rev. 1180, 1193-1194.)[31]
*848 The final question presented is whether an individual must exercise the right of publicity during his or her lifetime as a condition of its inheritability. The weight of authority holds that an individual need not exercise one's right of publicity "to protect it from use by others or to preserve any potential right of one's heirs." (Price v. Hal Roach Studios, Inc., supra, 400 F. Supp. at p. 846.)[32] A person may not have commercially exploited his name or likeness during his lifetime due to the absence of the appropriate medium or an early death. Perhaps the individual chose not to exercise the right to retain its full value as a legacy for his heirs. Since those choices do not conflict with the rationale for recognizing the right, the failure to exercise the right should not affect its inheritability.
Further, there is no reasonable method for ascertaining in a particular case if the right has been sufficiently exploited to warrant passing the right to the decedent's beneficiaries. There are no practical standards for measuring which uses and what period of use are required to create a protectible right. Absent clear rules, the right of publicity might be lost by the unwary. Hence, requiring the exercise of the right of publicity during the person's lifetime as a condition for inheritability is not only inconsistent with the rationale underlying the right but imposes an ill-defined prerequisite on its preservation.[33]
In summary, I would hold that a prominent person's interest in the economic value of commercial uses of his or her name and likeness is protected under the common law. This interest is denominated a right *849 of publicity and is assignable. The right is descendible and is accorded legal protection during the individual's lifetime and for a period of 50 years thereafter. Having found Universal licensed Lugosi's likeness in his distinctive portrayal of Count Dracula, the trial court properly held such use infringed on Lugosi's right of publicity. Since plaintiffs inherited that right upon Lugosi's death, they are entitled to relief for Universal's tortious conduct.
C. COPYRIGHT, PREEMPTION AND FREEDOM OF EXPRESSION
Universal asserts that a common law proprietary interest in one's name and likeness may not be recognized because such recognition is preempted by congressional legislation under the copyright clause of the United States Constitution. (See 17 U.S.C. § 301 (a); Sears, Roebuck & Co. v. Stiffel Co. (1964) 376 U.S. 225 [11 L. Ed. 2d 661, 84 S. Ct. 784]; Compco Corp. v. Day-Brite Lighting, Inc. (1964) 376 U.S. 234 [11 L. Ed. 2d 669, 84 S. Ct. 779].) That section provides that Congress shall have the power "[t]o promote the progress of science and useful arts, by securing for limited times to authors ... the exclusive right to their ... writings...." (U.S. Const., art. I, § 8, cl. 8.)
Under this clause, Congress could, at most, enact legislation governing all "writings." (See 17 U.S.C. § 102.)[34] The United States Supreme Court has recently defined writings "to include any physical rendering of the fruits of creative intellectual or aesthetic labor." (Goldstein v. California, supra, 412 U.S. at p. 561 [37 L.Ed.2d at p. 177]. See 1 Nimmer on Copyright, supra, § 1.08.) The intangible proprietary interest protected by the right of publicity simply does not constitute a writing. That interest may be valuable due to the individual's creative intellectual labors, but the publicity value generated by these labors is not focused in a "physical rendering." To conclude that the right of publicity is subject to congressional regulation under the copyright clause is to find that not only an author's writings, but also his mind, are subject to such control. Such a position is untenable. Thus, congressional action has not preempted the recognition of common law protection for the right of publicity. (Accord Price v. Hal Roach Studios, Inc., supra, 400 F. Supp. at pp. 845-846.)
*850 Any doubt on this issue was removed by the recent United States Supreme Court decision in Zacchini v. Scripps-Howard Broadcastig Co., supra, 433 U.S. 562. That case involved a television broadcast of plaintiff's entire performance in a human cannonball act. The Supreme Court found no impediment to the State of Ohio providing plaintiff with the "`right to the publicity value of his performance.'" (Id., at p. 565 [53 L.Ed.2d at p. 969].) "The Constitution does not prevent Ohio from... deciding to protect the entertainer's incentive in order to encourage the production of this type of work." (Id., at p. 577 [53 L.Ed.2d at p. 977].) If federal copyright law does not preclude a state from granting protection to an uncopyrighted performance, a fortiori the recognition of common law protection for the proprietary interest in one's name and likeness is immune from such attack. (See Note, supra, 42 Brooklyn L.Rev. at p. 545, fn. 85; Note, supra, 30 Stan.L.Rev. at pp. 1188, fn. 8, 1192-1194. Cf. Kewanee Oil Co. v. Bicron Corp. (1974) 416 U.S. 470 [40 L. Ed. 2d 315, 94 S. Ct. 1879]; Goldstein v. California, supra, 412 U.S. 546.)[35]
Recognizing plaintiffs' succession to Lugosi's right of publicity in his portrayal of Count Dracula does not interfere with the rights granted Universal under federal law in its copyrighted motion picture Dracula. In producing the film, Universal bargained and paid Lugosi for only limited rights: to employ Lugosi to portray Count Dracula in the production of one motion picture. (See discussion in section III, post.) Universal was and is free to exploit Lugosi's performance in that film within the confines of the copyright law. Universal can no more complain that its inability to merchandise Lugosi's image precludes the full use of its motion picture than protest that its inability to use scenes from Dracula in another motion picture restricts such use. Not having bargained for such rights, there is no entitlement. (Accord Price v. Hal Roach Studios, Inc., supra, 400 F. Supp. at pp. 842-843.)[36]
*851 Finally, I am sensitive to the fact that enforcement of the right of publicity may conflict with freedom of expression in some cases. However, such a conflict is not presented in this case. Plaintiffs challenged Universal's licensing of Lugosi's likeness in his portrayal of Count Dracula in connection with the sale of such objects as plastic toy pencil sharpeners, soap products, target games, candy dispensers and beverage stirring rods. Such conduct hardly implicates the First Amendment. (See Rosemont Enterprises, Inc. v. Urban Systems, Inc., supra, 72 Misc. 2d 788 [340 N.Y.S.2d at pp. 146-147], affd. as mod. 42 App. Div.2d 544 [345 N.Y.S.2d 17] [games]; Rosemont Enterprises v. Choppy Productions (1972) 74 Misc. 2d 1003 [347 N.Y.S.2d 83, 85] [T-shirts, sweatshirts]. Compare Factors Etc., Inc. v. Pro Arts, Inc., supra, 579 F.2d 215 [production of poster of Elvis Presley entitled "In Memory" not protected] with Paulsen v. Personality Posters, Inc. (1968) 59 Misc. 2d 444 [299 N.Y.S.2d 501] [Production of poster of Pat Paulsen in comic attire entitled "For President" protected].) This unauthorized exploitation of plaintiffs' proprietary interest in these commercial merchandising products is no more insulated from suit by the constitutional guarantees of freedom of expression than Universal's refusal to pay Lugosi for his services in portraying Count Dracula in Dracula would be. (Cf. Zacchini v. Scripps-Howard Broadcasting Co., supra, 433 U.S. 562; Grant v. Esquire, Inc., supra, 316 F. Supp. at p. 884.)
III. THE 1930 EMPLOYMENT AGREEMENT
In their 1930 employment agreement, Lugosi granted Universal certain rights to use his likeness and appearance as Count Dracula.[37] The trial court interpreted the contract to entitle Universal to use Lugosi's likeness only in the motion picture Dracula and in related advertisements. Universal argues that the grant-of-rights provision in that contract entitled Universal to license Lugosi's portrayal of Count Dracula in connection with the sale of commercial merchandising products.
*852 Universal correctly contends that if the trial court's interpretation were based solely on an examination of the contract, the interpretation of the contract is a question of law and this court will independently review the validity of the trial court's construction. (Argonaut Insurance Co. v. Transport Indemnity Co. (1972) 6 Cal. 3d 496, 502 [99 Cal. Rptr. 617, 492 P.2d 673].) However, if the trial court were presented with conflicting extrinsic evidence to aid in the interpretation of the contract, "a reasonable construction of the agreement by the trial court which is supported by substantial evidence will be upheld. [Citations.]" (In re Marriage of Fonstein (1976) 17 Cal. 3d 738, 746-747 [131 Cal. Rptr. 873, 552 P.2d 1169]; Grove v. Grove Valve & Regulator Co. (1970) 4 Cal. App. 3d 299, 310 [84 Cal. Rptr. 300]. See generally, 6 Witkin, Cal. Procedure (2d ed. 1971) Appeal, §§ 235 and 245, pp. 4225-4226, 4236-4238.)
The trial court was presented with conflicting expert testimony on the nature of the rights granted under the grant-of-rights provision and on whether an actor employed to perform in a motion picture usually retained or ceded the commercial merchandising rights in his likeness and appearance. Further, it is undisputed that in 1936 Universal requested and received Lugosi's permission to use in its production of Dracula's Daughter a wax likeness of Lugosi's portrayal of Count Dracula in Dracula. It is reasonable to infer that Universal would not have sought such consent if the 1930 contract granted Universal the broad right to use Lugosi's likeness which Universal now asserts. (See Warner Bros. Pictures v. Columbia Broadcasting System (9th Cir.1954) 216 F.2d 945, 949. Cf. Bohman v. Berg (1960) 54 Cal. 2d 787, 795 [8 Cal. Rptr. 441, 356 P.2d 185]; Tanner v. Title Insurance and Trust Co. (1942) 20 Cal. 2d 814, 823 [129 P.2d 383].) Such evidence provides a substantial basis for sustaining the trial court's reasonable interpretation of the grant-of-rights provision in the 1930 contract.[38] Indeed, an independent *853 examination of that contractual provision, with its repeated limitation on the use of Lugosi's likeness only "in connection with said photoplay," reaffirms the trial court's conclusion.[39]
Contrary to Universal's assertion, Labor Code section 2860[40] does not compel a different result. "... [Section 2860] is to be construed as but an expression of the familiar principle that forbids an agent or trustee from using the trust property or powers conferred upon him for his own benefit...." (Burns v. Clark (1901) 133 Cal. 634, 639 [66 P. 12]. Accord Southern Cal. Disinfecting Co. v. Lomkin (1960) 183 Cal. App. 2d 431, 444 [7 Cal. Rptr. 43]; Williams v. Weisser, supra, 273 Cal. App.2d at pp. 733-734.) That statute applies to a limited class of cases, primarily involving the exploitation of an employer's confidential information or trade secrets by a former employee to the employer's detriment. For example, the statute has been considered applicable in actions to enjoin a former employee from unauthorized use of confidential information concerning customers along a laundry route (Empire Steam Laundry v. Lozier (1913) 165 Cal. 95 [130 P. 1180]) and an ice route (Santa Monica Ice etc. Co. v. Rossier (1941) 42 Cal. App. 2d 467 [109 P.2d 382]), a confidential list of subscribers to a specialized newsletter (California Intelligence Bureau v. Cunningham (1948) 83 Cal. App. 2d 197 [188 P.2d 303]), and trade secrets concerning the production of cactus phonographic needles (Riess v. Sanford (1941) 47 Cal. App. 2d 244 [117 P.2d 694]).
*854 No such conduct is present here. Lugosi is not alleged to have "acquired" something from Universal which he improperly exploited. Rather, the issue is to what extent can Universal exploit Lugosi's portrayal of Count Dracula. The contract delineates the scope of Universal's entitlement: it clearly limited Universal's use to exploitation "in connection with said photoplay" (ante, fn. 37). The extrinsic evidence presented to the trial court supports that construction. Hence, the contract negates any suggestion that Universal may be entitled, under the doctrine embodied in section 2860, to unlimited use of Lugosi's likeness while portraying Count Dracula. (See Zahler v. Columbia Pictures Corp. (1960) 180 Cal. App. 2d 582, 589 [4 Cal. Rptr. 612].)
IV. THE STATUTE OF LIMITATIONS, DAMAGES AND PREJUDGMENT INTEREST
Neither party disputes the trial court's determination that the applicable statute of limitations is two years, as prescribed in Code of Civil Procedure section 339, subdivision 1. Universal asserts, however, that because this action was initiated in 1966, more than two years after the consummation of the first licensing agreement in 1960, plaintiffs are barred from any recovery.
Universal concluded approximately 50 licensing agreements with unrelated manufacturers between 1960 and 1966 and continued to enter into new agreements, and to amend and renew existing contracts, after this action was commenced. The execution of the first agreement did not contractually or otherwise compel Universal to conclude the others. The extensions or renewals of existing contracts were not mandated by the terms of the original agreements. I, therefore, agree with the trial court that each licensing agreement and renewal thereof represented a separate and distinct invasion of plaintiffs' rights. The execution of each agreement was independent of the others and each could have supported a separate cause of action. (Cf. Nestle v. City of Santa Monica (1972) 6 Cal. 3d 920, 937 [101 Cal. Rptr. 568, 496 P.2d 480].) Hence, the statute of limitations is not a complete bar to recovery.
The trial court held plaintiffs were barred from recovering damages for any licensing agreement executed more than two years before the filing of this action in 1966. (Code Civ. Proc., §§ 312 and 339, subd. 1.) Plaintiffs assert that the statutory period should not be calculated from the filing of the 1966 action but from the filing of the 1963 action, *855 which involved substantially the same claims, on the ground that the 1966 suit is merely a continuation of the 1963 suit.
While a lawsuit has been construed as the continuation of an earlier action in several decisions relied on by plaintiffs (see, e.g., Bollinger v. National Fire Ins. Co. (1944) 25 Cal. 2d 399 [154 P.2d 399]; Schneider v. Schimmels (1967) 256 Cal. App. 2d 366 [64 Cal. Rptr. 273]), the present case is readily distinguishable. First, in contrast to those decisions, the dismissal of the 1963 suit was on plaintiffs' own motion and was not the product of Universal's conduct. Second, plaintiffs were arguably responsible for the problem which caused the dismissal. Third, the second suit was not filed until 28 months after the dismissal. Finally, the dismissal did not preclude a trial on the merits. I thus conclude that the trial court did not err in calculating the statutory period from the filing of the underlying action, February 3, 1966.
After an extended trial, the court found that the plaintiffs were entitled to damages arising out of Universal's execution after February 3, 1964, of licensing agreements with approximately 35 different manufacturers. While Lugosi's portrayal of Count Dracula was the only character licensed in two of those agreements, each of the other contracts authorized the use of up to ten additional horror characters. Most of these agreements provided for the payment of a nonrefundable fee to Universal upon the execution of the licensing agreement as partial consideration for the grant of rights and as an advance against the royalties to be paid for the use of the licensed characters. Universal's royalty was usually set as a percentage of the licensee's sales.
From these contracts, Universal received more than $260,000 in royalties.[41] The trial court awarded plaintiffs $53,023.23 of this amount for Universal's licensing Lugosi's portrayal of Count Dracula. Universal raises numerous challenges to this award.
Because the use of Lugosi's likeness in this context resembles a copyright or patent infringement, the well developed principles for determining damages in those contexts provide a useful guide.[42] Plaintiff has the *856 initial burden of proving the extent of the profits reaped by defendant through its misappropriation. However, where a portion of defendant's profits derives from other than the unauthorized use but defendant had commingled the sources of income, the defendant "carries the burden of disentangling the contributions of the several factors which he has confused." (Sheldon v. Metro-Goldwyn Pictures Corporation (2d Cir.1939) 106 F.2d 45, 48, affd. 309 U.S. 390 [84 L. Ed. 825, 60 S. Ct. 681].) If the defendant provides sufficient evidence, a fair division of the profits will result. "Mathematical exactness" in the apportionment is not required. (Id., 309 U.S. at p. 404 [84 L.Ed. at p. 833].) However, the resulting allocation must "favor the plaintiffs in every reasonable chance of error." (Id., 106 F.2d at p. 51.)
Universal's conduct prevented an apportionment of the royalty income between the Count Dracula character and the other licensed characters. Neither the licensing agreements nor Universal's accounting system allocated the royalty payments from each contract among the licensed characters. The isolated data provided by a few licensees about certain agreements was not persuasive on this matter to the trial court. Absent more compelling data, the trial court found that one-third of the income from multi-character contracts should be allocated to the use of Count Dracula.[43]
This restrained apportionment reflected the trial court's assessment of Count Dracula's relatively greater public visibility and resulting commercial value when compared to the other licensed characters, such as the Mutant and the Mole Man. While most of the licensee's secured the right to use only some of the available characters, they consistently secured the right to Count Dracula. Universal's assertion, that plaintiffs are only entitled to an amount equal to the royalty from each agreement divided by the number of licensed characters, is based on the unsupported assumption that all horror characters are equally valuable. In light of Universal's burden in this case, I am not persuaded the trial court's allocation was unreasonable.[44]
*857 Universal was unable to identify the source of approximately $14,000 of the $260,000 in royalties received from horror character licensing agreements. Finding that Universal had not borne its burden of demonstrating the origin of that sum, the trial court allocated the entire sum to the licensing of Count Dracula. Universal asserts that only one-third of that amount should have been allocated to the use of Count Dracula, consistent with the one-third allocation adopted by the trial court for royalties from multicharacter agreements.
However, it is undisputed that two of the agreements licensed the use of only Count Dracula. All of the royalties from those agreements were thus awarded to plaintiffs. In light of Universal's burden and plaintiffs' entitlement to all royalties from certain agreements, the trial court's resolution was not error.
The trial court also awarded all royalty income received between July 1, 1972, and October 31, 1972, to plaintiffs.[45] The $4,500 at issue was apparently derived from multiple character agreements, which had otherwise been subjected to a one-third apportionment. The trial court's findings do not clearly set forth the rationale behind the different treatment accorded the royalties received during this period. Therefore, I would remand this aspect of the damage award to the trial court. On remand, the trial court would not be precluded from considering a different apportionment if the income received in this period was recorded in a separate account to prevent its discovery by plaintiffs or was the product of licensing agreements concluded in violation of the interlocutory injunction. However, absent special circumstances, royalties received under multicharacter agreements concluded before the entry of the interlocutory injunction should be divided in accordance with the one-third allocation adopted by the court.
Universal also challenges the trial court's conclusion that the statute of limitations did not bar plaintiffs from recovering damages based on Universal's agreement with ABG Products Inc. The agreement was executed *858 on January 30, 1964, with a term from March 1, 1964, to March 28, 1965. The licensee was obligated to pay Universal a $500 nonrefundable fee upon the execution of the agreement. The contract was subsequently extended to expire on March 28, 1967.
The trial court found that recovery for contracts executed prior to February 3, 1964, was barred by the statute of limitations. This contract was clearly executed before that date, and Universal received an immediate payment for licensing the use of the horror characters, including Count Dracula. Since Universal's tortious conduct consisted of licensing Lugosi's portrayal of Count Dracula and that act occurred beyond the statutory period, it is inconsequential that the licensee could not begin to sell its products until after February 3, 1964. (Cf. Davies v. Krasna, supra, 14 Cal.3d at pp. 513-514.) On remand, I would direct the trial court to delete any award of damages arising from the January 30, 1964, contract. However, it is equally clear that plaintiffs remain entitled to damages based on any royalty paid under any extension or renewal of that contract after February 3, 1964.[46]
The trial court awarded plaintiffs prejudgment interest under Civil Code section 3288 on the entire amount of the damages from the midpoint of the infringement, January 1, 1969. Section 3288 gives the trial court discretion to award prejudgment interest "[i]n an action for the breach of an obligation not arising from contract...." An award of interest under section 3288 is not conditioned on plaintiff's damages having been liquidated at the date from which the interest is calculated. (See Bullis v. Security Pac. Nat. Bank (1978) 21 Cal. 3d 801, 814-815 [148 Cal. Rptr. 22, 582 P.2d 109].) Here, Universal had the use of some of the profits from their infringement for a decade prior to the entry of judgment. In this case, I do not find that the award of interest, from the midpoint of the infringement, was an abuse of discretion. (See Amador *859 Valley Investors v. City of Livermore (1974) 43 Cal. App. 3d 483, 494-495 [117 Cal. Rptr. 749].)
V. CONCLUSION
Judicial recognition and protection of the proprietary interest in one's name and likeness is not an unjustified foray by the judiciary into the legislative domain but a recognition of the common law's sensitivity to the evolution of societal needs and its ability to adapt to new conditions. The trial court properly found Lugosi had a right of publicity in his likeness in his portrayal of Count Dracula and that the right descended to plaintiffs as his beneficiaries.
The right of publicity is distinct from the right of privacy. The majority's effort to squeeze the former into the traditional parameters of the latter is ultimately destructive of both rights. To accommodate the right of privacy to the realities of the commercial use of a celebrity's identity, the majority hastily provided that the right was assignable. Yet, the right of privacy has heretofore been considered a personal, nonassignable right. In characterizing a prominent individual's interest in the commercial uses of his identity as solely affecting the right of privacy, the majority have failed to confront the dual nature of such appropriations. In the process, the individual's interest has been undervalued, and a salutary development in the common law hailed in other jurisdictions has been aborted.
I would reverse the judgment and remand the cause to the trial court with directions to modify the damage award and injunction consistent with the views expressed herein. In all other respects, I would affirm the judgment.
Tobriner, J., and Manuel, J., concurred.
NOTES
[*] Brackets together, in this manner [], are used to indicate deletions from the opinion of the Court of Appeal; brackets enclosing material (other than the editor's parallel citations) are, unless otherwise indicated, used to denote insertions or additions by this court. (Doers v. Golden Gate Bridge etc. Dist. (1979) 23 Cal. 3d 180, 183 [151 Cal. Rptr. 837, 588 P.2d 1261].)
[1] Appellant Universal Pictures, a Division of Universal City Studios, Inc., is the survivor of Universal Pictures Company, Inc. Appellant and its predecessor corporation are referred to herein collectively as Universal.
[2] "The producer shall have the right to photograph and/or otherwise produce, reproduce, transmit, exhibit, distribute, and exploit in connection with the said photoplay any and all of the artist's acts, poses, plays and appearances of any and all kinds hereunder, and shall further have the right to record, reproduce, transmit, exhibit, distribute, and exploit in connection with said photoplay the artist's voice, and all instrumental, musical, and other sound effects produced by the artist in connection with such acts, poses, plays and appearances. The producer shall likewise have the right to use and give publicity to the artist's name and likeness, photographic or otherwise, and to recordations and reproductions of the artist's voice and all instrumental, musical, and other sound effects produced by the artist hereunder, in connection with the advertising and exploitation of said photoplay." (Italics added.)
[3] The trial court also held that [plaintiffs'] claim arising from the sales of merchandising rights under licensing agreements entered into by Universal prior to February 3, 1964, were barred by the statute of limitations. [Plaintiffs] cross-appeal from the judgment to the extent it omitted an award on claims arising prior to 1964.
[4] Stoker failed to comply with the United States deposit requirements in effect in 1897. In England and other countries adhering to the Berne Convention the novel passed into the public domain in April 1962.
[5] In Johnston, supra, the court says at page 810: "An idea given embodiment in tangible form is the subject of common law property right."
Thus, the idea to sell commercial tie-ups, if it had been crystallized into a business by Lugosi during his lifetime would have resulted in property as that term is defined in Civil Code section 654. (See discussion in Johnston, supra, p. 808.)
[6] Item 4 of Dean Prosser's classification of invasions of privacy has been complemented legislatively by Civil Code section 3344, adopted in 1971. [That section provides for the recovery of damages for the unauthorized commercial use of another persons's "name, photograph, or likeness," under specified conditions. One commentator suggests that section 3344 may confer a property right in one's personal identity, i.e., a "right of publicity." (Note (1972) 3 Pacific L.J. 651, 669.) Significantly, section 3344 does not purport to create a descendible right enforceable by the heirs of the person whose identity was appropriated.]
[7] For the purpose of the illustration, we assume [plaintiffs'] position that Universal would have had no conflicting rights. As stated infra we do not decide this question.
[8] We have analyzed Price v. Hal Roach Studios, Inc. (S.D.N.Y. 1975) 400 F. Supp. 836, which relies in part on the trial court's opinion. [] [Roach found "no logical reason to terminate this right [of publicity] upon death of the person protected." (P. 844.) To the contrary, as we have explained, a rule of nondescendibility is justified by the personal nature of the right, coupled with the difficulty in judicially selecting an appropriate durational limitation were it held descendible to one's heirs. (See also Factors Etc., Inc. v. Pro Arts, Inc. (2d Cir.1978) 579 F.2d 215, 220-222; Factors Etc., Inc. v. Creative Card Co. (S.D.N.Y. 1977) 444 F. Supp. 279, 282-285.)]
[1] There has long been a debate in literary circles as to whether Dracula is wholly fictional or the prototype of an actual nobleman who once lived in Rumania, in the Transylvanian Alps. In travel literature the government of Rumania motivated, one suspects, by the potential rewards of tourism identifies a specific Carpathian castle as the ancestral home of the Count.
[1] The initial agreements were executed by Universal Pictures Corporation, predecessor of Universal Picture Company, Inc. The latter corporation was subsequently merged into Universal City Studios, Inc., and is now known as Universal Pictures, a division of Universal City Studios, Inc. Defendant and its predecessor corporations are herein referred to as Universal. Universal is a wholly owned subsidiary corporation of MCA, Inc.
[2] Universal simultaneously secured motion picture rights to the novel Dracula, first published in 1897, and the stage play based thereon. The stage play was first performed in 1927 with Bela Lugosi portraying Count Dracula. An earlier motion picture depicting the character Count Dracula had been produced in 1922.
[3] Numerous other actors, including Lon Chaney, Jr., Christopher Lee and John Carradine, have played the part of Count Dracula in motion pictures or on stage. Some of those motion pictures were produced and/or distributed by Universal.
[4] The other licensed characters included the Frankenstein Monster, the Wolf Man, the Mummy, the Creature from the Black Lagoon, the Phantom of the Opera, Mr. Hyde, the Mutant, the Mole Man, and the Hunchback of Notre Dame.
[5] The trial court also found that the 1936 contract between Lugosi and Universal, which purported to constitute a full settlement and compromise of all claims and demands which Lugosi had or might have in the future against Universal, based on their prior contracts, did not preclude an action for a tortious appropriation of his image arising many years after that agreement.
[6] Thus, the trial court found that plaintiffs were not entitled to damages based on any royalty received after February 3, 1964, if that royalty was derived from contracts or extensions executed before that date.
[7] The injunction entered by the trial court provides: "It is further Ordered, Adjudged and Decreed that said defendant Universal Pictures, a division of Universal City Studios, Inc., and each and all of said defendants affiliated and/or related corporations including MCA Entertainment, Inc., a corporation, MCA Enterprises, Inc., a corporation, The Danelectro Corporation, a corporation, Universal City Studios, Inc., MCA, Inc., other subsidiary corporations of MCA, Inc., and the officers, directors, employees and agents of said defendant and of each of its said affiliated and/or related corporations and each of them, and their respective successors, assigns and licensees, shall be and are hereby permanently enjoined and restrained from making or entering into any license or agreement of any kind or nature and however denominated which grants, authorizes, permits, consents to or licenses the name, likeness or appearance of Bela Lugosi, deceased, as Count Dracula on or in connection with the manufacture, distribution, sale, advertising or exploitation of any commercial merchandising products whatever; and from engaging in or participating with, by or through any other person, firm, partnership, joint venture, association or corporation in the manufacture, distribution, sale, advertising or other exploitation of Bela Lugosi's said name, likeness or appearance on or in connection with any commercial merchandising products whatever. The foregoing injunction does not apply or extend to the distribution, exhibition and broadcasting of the motion pictures entitled Dracula, Dracula's Daughter, Abbott and Costello Meet Frankenstein in theatres or on television and advertising in connection with the same, nor does said injunction apply or extend to any factually true biographical information about said decedent, Bela Lugosi, including comments and opinions thereon published, disseminated and communicated in any visual, audial, or audio-visual medium of expression."
[8] It is not disputed that the right of privacy is a personal right, which is not assignable and ceases with an individual's death. (See, e.g., Cain v. State Farm Mut. Auto. Ins. Co. (1976) 62 Cal. App. 3d 310, 313 [132 Cal. Rptr. 860]; Hendrickson v. California Newspapers, Inc. (1975) 48 Cal. App. 3d 59, 62 [121 Cal. Rptr. 429]; Werner v. Times-Mirror Co. (1961) 193 Cal. App. 2d 111, 116 [14 Cal. Rptr. 208]; Kelly v. Johnson Publishing Co. (1958) 160 Cal. App. 2d 718, 721 [325 P.2d 659]. See generally Rest.2d Torts, § 6521; Prosser, Torts (4th ed. 1971) § 117, p. 802 et seq.; Annot., Right of Privacy (1950) 14 A.L.R. 2d 750 and cases cited therein.) Thus, if the use of Lugosi's likeness in the sale of commercial products violated only Lugosi's right of privacy, such use after Lugosi's death would not entitle plaintiffs to any relief.
[9] A common law right of privacy has long been recognized by the courts of this state. (See, e.g., Briscoe v. Reader's Digest Association, Inc. (1971) 4 Cal. 3d 529 [93 Cal. Rptr. 866, 483 P.2d 34, 57 A.L.R. 3d 1]; Coverstone v. Davies (1952) 38 Cal. 2d 315 [239 P.2d 876]; ; Melvin v. Reid (1931) 112 Cal. App. 285 [297 P. 91].) In addition, the people of California have recently adopted a constitutional right to privacy. (Cal. Const., art. I, § 1.)
[10] The present case indisputably involves the commercial use of the likeness of a prominent person. No opinion is expressed on whether the rights recognized herein apply to other individuals. (Compare Ali v. Playgirl, Inc., supra, 447 F. Supp. at p. 729 with Nimmer, supra, 19 Law & Contemp. Prob. at p. 217 and Treece, supra, 51 Texas L.Rev. at pp. 643, fn. 27, 644-645.)
[11] This is not to suggest that commercial misappropriations of one's likeness may not inflict noneconomic injuries. Commercial misappropriations may injure a person's feelings in several ways. First, the person may find any commercial exploitation undesirable and offensive. Second, while certain commercial uses may be acceptable or even desirable, a particular use may be distressing. (See, e.g., O'Brien v. Pabst Sales Co. (5th Cir.1942) 124 F.2d 167, 170.) Third, other individuals, unaware that the use is unauthorized, may disparage one who would sell their identity for that purpose, thereby inducing embarrassment, anger or mental distress. (See generally, Treece, supra, 51 Texas L.Rev. at pp. 638-648; Note, Community Property Interests in the Right of Publicity: Fame and/or Fortune (1978) 25 UCLA L.Rev. 1095, 1108-1109.) Further, any unauthorized use infringes on one's effort to control the public projection of one's identity, including the desire for solitude and anonymity.
[12] As one court observed nearly 70 years ago in recognizing the need to accord protection to the economic value in one's identity: "If there is value in [one's likeness], sufficient to excite the cupidity of another, why is it not the property of him who gives it the value and from whom the value springs?" (Munden v. Harris (1911) 153 Mo. App. 652 [134 S.W. 1076, 1078].)
[13] Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc. (2d Cir.1953) 202 F.2d 866, 868; Nimmer, supra, 19 Law & Contemp. Prob. 203.
[14] See, e.g., Factors Etc., Inc. v. Pro Arts, Inc. (2d Cir.1978) 579 F.2d 215, 221; Ali v. Playgirl, Inc. supra, 447 F. Supp. at pages 728-729; Zacchini v. Scripps-Howard Broadcasting Co. (1977) 433 U.S. 562, 575-578 [53 L. Ed. 2d 965, 975-978, 97 S. Ct. 2849]; Factors Etc., Inc. v. Creative Card Co., supra, 444 F. Supp. at page 282; Memphis Development Foundation v. Factors Etc., Inc. (W.D.Tenn. 1977) 441 F. Supp. 1323, 1330, affirmed (6th Cir.1978) 578 F.2d 1381; Lombardo v. Doyle, Dane & Bernbach, Inc. (1977) 58 App.Div.2d 620 [396 N.Y.S.2d 661, 664]; Rosemont Enterprises, Inc. v. Urban Systems, Inc., supra, 72 Misc. 2d 788 [340 N.Y.S.2d at page 146], affirmed as modified 42 App.Div.2d 544 [345 N.Y.S.2d 17]; Grant v. Esquire, Inc., supra, 367 F. Supp. at page 880; Uhlaender v. Hendricksen, supra, 316 F. Supp. at pages 1280-1283; Cepeda v. Swift & Co. (8th Cir.1969) 415 F.2d 1205, 1206; McQueen v. Wilson (1968) 117 Ga. App. 488 [161 S.E.2d 63, 65-66], reversed on other grounds 224 Ga. 420 [162 S.E.2d 313]; Canessa v. J.I. Kislak, Inc. (1967) 97 N.J. Super. 327 [235 A.2d 62, 75-76]; Hogan v. A.S. Barnes & Co., Inc. (Pa. Ct. C.P. Phil.Cy. 1957) 114 U.S.P.Q. 314 (discussed in Note, The Right of Publicity Protection for Public Figures and Celebrities (1976) 42 Brooklyn L.Rev. 527, 535-536); Ettore v. Philco Television Broadcasting Corp. (3d Cir.1956) 229 F.2d 481, 487, 489-492; Haelan Laboratories, Inc. v. Topps Chewing Gum, Inc., supra, 202 F.2d at page 868; U.S. Life Ins. Co. v. Hamilton (Tex.Civ.App. 1951) 238 S.W.2d 289, 292; O'Brien v. Pabst Sales Co., supra, 124 F.2d at page 170 (dis. opn. of Holmes, J.); Munden v. Harris, supra, 134 S.W. at page 1079; Edison v. Edison Polyform Mfg. Co. (1907) 73 N.J. Eq. 136 [67 A. 392].
Despite this increasing trend toward recognizing a distinct right to control the commercial exploitation of one's name and likeness, the development of this right has been spasmodic. This is in part a consequence of courts adjudicating claims which might be categorized as invasions of plaintiff's right of publicity as privacy claims. (See cases cited in fn. 20, post.) The resulting confusion often noted by commentators, has impeded the development of the right. (See, e.g., Note, supra, 29 Hastings L.J. at pp. 752-754; Gordon, Right of Property in Name, Likeness, Personality and History (1960) 55 Nw. U.L.Rev. 553, 554, 606 et seq.; Note, supra, 42 Brooklyn L.Rev. at pp. 527, 540-541.)
This confusion is due, in part, to the failure of litigants to delineate carefully the nature of the interest sought to be vindicated. However, a certain amount of equivocation is not surprising when the right of publicity is discussed as a variety of the right of privacy, a personal right, and then promptly described as a property right. The Restatement Second of Torts, for example, discusses the appropriation of a person's name or likeness under the rubric of the right of privacy. (§ 652C.) That right is deemed to be personal and nonassignable and to terminate upon death. (§ 652I.) However, the Restatement Second also states that the protection "appears ... to confer something analogous to a property right upon the individual" (§ 652A, com. b), that the right to use one's name is assignable (§ 652C, com. a), and that survival rights may be held to exist (§ 652I, com. b).
[15] See, e.g., Note, supra, 29 Hastings L.J. at page 754; Note, supra, 25 UCLA L.Rev. at pages 1096, 1102-1109; Comment, Privacy, Appropriation, and the First Amendment: A Human Cannonball's Rather Rough Landing (1977) B.Y.U.L.Rev. 579, 587; Note, supra, 42 Brooklyn L.Rev. at page 545; Pember & Teeter, Privacy and the Press since Time, Inc. v. Hill (1974) 50 Wash.L.Rev. 57, 87-88; Treece, supra, 51 Texas L.Rev. at pages 647-648; Hofstadter & Horowitz, supra, section 1.4, pages 6-7; Gordon, supra, 55 Nw.U.L.Rev. 553.
[16] The court's thoughtful analysis reflects an understanding of the distinctions between the right of publicity and the right of privacy. "While much confusion is generated by the notion that the right of publicity emanates from the classic right of privacy, the two rights are clearly separable. The protection from intrusion upon an individual's privacy, on the one hand, and protection from appropriation of some element of an individual's personality for commercial exploitation, on the other hand, are different in theory and in scope.
"................
"Since the theoretical basis for the classic right of privacy, and of the statutory right in New York, is to prevent injury to feelings, death is a logical conclusion to any such claim. In addition, based upon the same theoretical foundation, such a right of privacy is not assignable during life. When determining the scope of the right of publicity, however, one must take into account the purely commercial nature of the protected right. Courts and commentators have done just that in recognizing the right of publicity as assignable. There appears to be no logical reason to terminate this right upon death of the person protected. It is for this reason, presumably, that this publicity right has been deemed a `property right.'" (Fns. omitted.) (Id., at pp. 843, 844.)
[17] In Uhlaender v. Hendricksen, supra, 316 F. Supp. at page 1282, the court held "... that a celebrity has a legitimate proprietary interest in his public personality. A celebrity must be considered to have invested his years of practice and competition in a public personality which eventually may reach marketable status. That identity, embodied in his name, likeness, statistics and other personal characteristics, is the fruit of his labors and is a type of property."
[18] Implicit in affording an individual the right to control the commercial exploitation of his or her name and likeness is the right to limit or entirely prevent such use. Such limitation may be motivated by an effort to husband the value or by a refusal to allow the use of one's identity to promote the sale of commercial products. Thus, recognition of the right provides protection as well for an individual's interest in not being subjected to commercial exploitation. (See generally, fn. 11, ante.)
[19] One commentator has suggested a related benefit which may flow from recognizing an individual's right of publicity: "The use of celebrities' names and pictures appears to be a characteristic of advertising. Advertisers would probably continue to use celebrities' pictures even if they knew that other advertisers could freely make similar use of the same names and pictures. In other words, if free use of names and pictures developed, they would probably continue to attract the consumer's attention, provoke emulation, and, perhaps, suggest sponsorship. If society chooses to allow uses of names and likenesses in advertising, it might prefer that consumers not be misled about the willingness of a celebrity to associate himself with a product or service. It might give celebrities a cause of action for unconsented uses of names and likenesses in furtherance of that objective. Similarly, society might decide that the `emulating' behavior of consumers would channel itself more acceptably if the persons emulated had some control over the decision to link their names and likenesses with particular products. Indeed, persons whose personalities attract consumers might find that coercing advertisers to forego some forms of undesirable advertising behavior advances their interests. Allowing individuals to control the advertising use of their personalities could thus provide a private law mechanism for advertising regulation." (Treece, supra, 51 Texas L.Rev. at p. 647, fn. omitted.)
[20] Universal relies on decisions from several jurisdictions for its contention that an appropriation of one's name or likeness is only protected under the right of privacy. Such reliance is misplaced. In several cases, the court reached its result under the principles governing the right of privacy because the plaintiff had based its claim on an invasion of that right. (See, e.g., Maritote v. Desilu Productions, Inc. (7th Cir.1965) 345 F.2d 418, 420 ["... all of the relief sought by the several plaintiffs is essentially for a claimed invasion of a right of privacy." (Fn. omitted)]; Gruschus v. Curtis Publishing Co. (10th Cir.1965) 342 F.2d 775; O'Brien v. Pabst Sales Co., supra, 124 F.2d 167.) In Miller v. C.I.R. (2d Cir.1962) 299 F.2d 706, 708, the court expressly limited its discussion to definitions applicable to federal income tax law. In Schumann v. Loew's, Incorporated (Sup. 1954) 135 N.Y.S.2d 361, 369, a New York trial court rejected the assertion that a great-grandchild of a prominent person could recover for the unauthorized use of that person's name in a motion picture produced many years after that person's death. Beyond the obvious distinctions between that case and the present matter, the continuing significance of that decision is unclear since New York courts have subsequently recognized a proprietary interest in one's name. (See cases cited in fn. 14, ante.)
[21] Universal's assertion that prior California decisions have reached a contrary conclusion is mistaken. Although the underlying facts in Fairfield v. American Photocopy Equipment Co., supra, 138 Cal. App. 2d 82 and James v. Screen Gems, Inc. (1959) 174 Cal. App. 2d 650 [344 P.2d 799] might have supported a cause of action based on a proprietary interest in the names used, both courts adopted the parties' characterizations of the actions as involving the right of privacy and applied principles governing privacy actions. Similarly, the courts in Williams v. Weisser (1969) 273 Cal. App. 2d 726 [78 Cal. Rptr. 542, 38 A.L.R. 3d 761] and Stilson v. Reader's Digest Assn. Inc. (1972) 28 Cal. App. 3d 270 [104 Cal. Rptr. 581] expressly adopted the analytic framework established in Fairfield in evaluating the appropriation of the plaintiff's name in each case. It does not appear that the plaintiff in either case seriously pursued recovery based on an invasion of a property right. However, one legal commentator identified two California trial courts which did recognize the property interest involved. (Gordon, supra, 55 Nw.U.L.Rev. at p. 587, fn. 152. Cf. Motschenbacher v. R.J. Reynolds Tobacco Co., supra, 498 F.2d at p. 825 [finding that California courts would protect, regardless of the rubric adopted, "an individual's proprietary interest in his own identity"].)
[22] "`The term "property" is sufficiently comprehensive to include every species of estate, real and personal, and everything which one person can own and transfer to another. It extends to every species of right and interest capable of being enjoyed as such upon which it is practicable to place a money value.'" (Yuba River Power Co. v. Nevada Irrigation District (1929) 207 Cal. 521, 523 [279 P. 128]. See White v. Kimmel (S.D.Cal. 1950) 94 F. Supp. 502, 504, revd. on other grounds 193 F.2d 744; Civ. Code, §§ 654, 655. Cf. Warren & Brandeis, supra, 4 Harv.L.Rev. at pp. 193-195.)
[23] The Legislature recently enacted Civil Code Section 3344 to provide a minimum amount of damages where an unauthorized commercial appropriation constitutes an invasion of privacy. The Legislature's creation of this statutory remedy evidences its concern with commercial misappropriations of an individual's identity, and thereby reinforces the propriety of recognizing common law protection in the related area of the right of publicity.
Section 3344 provides: "(a) Any person who knowingly uses another's name, photograph, or likeness, in any manner, for purposes of advertising products, merchandise, goods or services, or for purposes of solicitation of purchases of products, merchandise, goods or services, without such person's prior consent, or, in the case of a minor, the prior consent of his parent or legal guardian, shall be liable for any damages sustained by the person or persons injured as a result thereof. In addition, in any action brought under this section, the person who violated the section shall be liable to the injured party or parties in an amount no less than three hundred dollars ($300).
"...............
"(g) The remedies provided for in this section are cumulative and shall be in addition to any others provided for by law."
The legislative history of section 3344 strongly suggests that the Legislature was concerned with an individual's right to privacy, not an individual's proprietary interest in his or her name and likeness. The Assembly Judiciary Committee's analysis, the Legislative analysis and the Legislative Counsel's Digest of Assembly Bill No. 826 (1971 Reg. Sess.), which became section 3344, all characterized the problem presented as an "invasion of privacy." (See, e.g., Assem. Jud. Com., Analysis of Assem. Bill No. 826 (Vasconcellos) as amended (1971 Reg. Sess.) (June 14, 1971) p. 1. See also Stilson v. Reader's Digest Assn., Inc., supra, 28 Cal. App.3d at p. 273.) As the bill's author explained, "[t]his bill fills a gap which exists in the common law tort of invasion of privacy in the state of California": to provide a minimum amount of damages for the invasion of the "little man['s]" privacy occasioned by an unauthorized commercial use. "[I]t becomes imperative that the law be equipped to provide some sort of protection to the individual citizen from an invasion of his privacy. This bill provides a simple, civil remedy for the injured individual." (Letter from Assemblyman Vasconcellos to Governor Reagan recommending Assem. Bill No. 826 for his signature (Nov. 10, 1971) italics added.) In contrast to these numerous references to the right of privacy, there is no mention in the legislative documents of the right of publicity or the economic interest protected thereunder.
In this context, it is consistent with the common law limitation on the right to privacy for the statute not to provide for an action by one's heirs. (See maj. opn., ante, p. 819, fn. 6.) However, such a limitation is irrelevant in establishing the parameters of the distinctive common law right of publicity. Moreover, the Legislature unequivocally established in subdivision (g) that this statutory remedy be in addition to any other remedies provided for by law and thus would coexist with related common law actions, including an action for the infringement of the right of publicity. (See Weinstein, Commercial Appropriation of Name and Likeness: Section 3344 and The Common Law (1977) 52 L.A. Bar J. 430, 432-433, 435, 454-455.)
[24] This fundamental distinction is not undercut because a genuine invasion of privacy may also result in pecuniary loss. For example, the publication of previously private information may result in an economic loss if a client of the injured party severs their relationship in light of that publication. The direct harm is injury to feelings, the economic loss being entirely derivative. In contrast, the unauthorized use of one's name for commercial purposes inflicts a direct financial loss. In addition, the injured party's economic loss in a privacy action rarely benefits the tortfeasor. By definition, an appropriation is intended to benefit the person improperly using the name or likeness. Finally, a person need not suffer any economic harm to state a claim for an invasion of privacy; in contrast, economic loss is the essence of an action based on a misappropriation for commercial purposes. (See Uhlaender v. Hendricksen, supra, 316 F. Supp. at p. 1280; Comment, supra, 22 UCLA L.Rev. at pp. 1103-1104; Prosser, supra, 48 Cal. L.Rev. at p. 406; Note, supra, 29 Hastings L.J. at p. 754.)
[25] See Nimmer, supra, 19 Law & Contemp. Prob. at pages 204-206; Note, supra, 25 UCLA L.Rev. at page 1107. Cf. Uhlaender v. Hendricksen, supra, 316 F. Supp. at page 1283.
[26] This protection extends only to the individual's likeness a representation or image of the person while portraying the particular character. Nothing herein is intended to extend protection to the idea for the character or to the character itself. Nothing in the right of publicity prohibits another person, for example, from developing and playing a sympathetic tramp character similar to the one portrayed by Chaplin.
[27] This case does not present the question of the relative rights of the novel's copyright holder and Lugosi and his heirs in commercial exploitations of Lugosi's likeness in his portrayal of Count Dracula. However, it should be noted that the trial court found that the novel Dracula has always been in the public domain in the United States due to the author's failure to comply with a requirement of the copyright law in existence when the novel was published.
[28] Where the portrayal of a fictional character is the product of a joint enterprise, the respective rights of the parties can be established by contract. The contractual relationship between Lugosi and Universal is detailed in section III, post.
[29] See, e.g., Factors Etc., Inc. v. Pro Arts, Inc., supra, 579 F.2d at page 221; Cepeda v. Swift & Co., supra, 415 F.2d at page 1206; Haelan Laboratories, Inc., v. Topps Chewing Gum, Inc., supra, 202 F.2d at page 868; Prosser, Torts (4th ed. 1971) section 117, page 807; Gordon, supra, 55 Nw. U.L.Rev. at page 611; Nimmer, supra, 19 Law & Contemp. Prob. at page 216.
[30] Those decisions which have considered whether the right of publicity survives death have ruled in favor of its inheritability. (See, e.g., Factors Etc., Inc. v. Pro Arts, Inc., supra, 579 F.2d at pp. 221-222; Factors Etc., Inc. v. Creative Card Co., supra, 444 F. Supp. at pp. 282, 284; Memphis Development Foundation v. Factors, Etc., Inc., supra, 441 F. Supp. at p. 1330; Price v. Hal Roach Studios, Inc., supra, 400 F. Supp. at p. 844; Shaw v. United Artists Corp. (E.D. Ill.) 54 C 290 (unreported, discussed in Gordon, supra, 55 Nw. U.L.Rev. at p. 600).) This result has been approved by numerous legal commentators. (See, e.g., Note, supra, 29 Hastings L.J. at pp. 767-768; Note, supra, 42 Brooklyn L.Rev. at pp. 541-547; Note, Why Not A Relational Right of Privacy Or Right of Property? (1973) 42 Mo. Kansas City L.Rev. 175, 183; Sobel, Count Dracula and the Right of Publicity (1972) 47 L.A. Bar Bull. 373, 375-376; Donenfeld, Property or Other Rights in the Names, Likeness or Personalities of Deceased Persons (1968) 16 Bull. Copyright Soc'y. 17; Gordon, supra, 55 Nw. U.L.Rev. at pp. 598-599, 612-613.)
[31] Universal asserts that the recognition of any right after death will deluge the courts with trivial and specious complaints concerning the use of the names of long-dead notables, e.g., Henry VIII. This argument is unpersuasive. The statutes of limitations, the absolute limitation on the duration of the right, and the difficulties of proving ownership of that right, not mere descendency, will provide ample barriers to stale claims. (See Gordon, supra, 55 Nw.U.L.Rev. at p. 601; Sobel, supra, 47 L.A. Bar Bull. at pp. 403-404.)
[32] See Grant v. Esquire, Inc., supra, 367 F. Supp. at page 880; Munden v. Harris, supra, 134 S.W. at page 1078; Note, supra, 29 Hastings L.J. at pages 764-766. But see Factors Etc., Inc. v. Pro Arts, Inc., supra, 579 F.2d at page 222, footnote 11.
[33] The majority would appear to have concluded that an individual's right of publicity may be exploited after his death if exercised or assigned by the individual during his lifetime. (See maj. opn., ante, pp. 819-820, 823.) As explained in the text, such a proposition is illogical. It is particularly unpersuasive under the facts of this case.
Actors, like Lugosi, continually exploit their popularity through the medium of their profession. They and their employers consciously trade on the public's interest in and recognition of them. In this case, as the majority recognize, Lugosi granted Universal the right to make limited use of his likeness, as both parties sought to profit from his portrayal of Count Dracula. Under the majority's analysis, such conduct would be sufficient for Universal to exploit Lugosi's right of publicity after Lugosi's death as it did in the subject licensing agreements, if Lugosi had granted Universal merchandising rights in their contract. Yet, such conduct is incongruously insufficient for Lugosi to retain such rights for his heirs. Once assigned to Universal, Lugosi's right of publicity may remain dormant until a suitable medium and setting is found. But the majority would deny Lugosi the right to retain his interest in his own likeness undeveloped as a legacy for his heirs. Such a distinction is wholly unjustified.
[34] Section 102 provides in part: "Copyright protection subsists ... in original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device."
[35] It appears that Universal's misplaced reliance on the preemption doctrine was based, in part, on a misunderstanding of the scope of rights recognized by the trial court. Lugosi's beneficiaries were not declared to have any control over the Count Dracula character. Nothing in Lugosi's right of publicity precludes others from portraying Count Dracula and exploiting or filming such characterizations. Rather, Lugosi was declared to have a proprietary interest in his likeness, which includes his likeness in his portrayal of Count Dracula. (See discussion at pp. 844-845, ante.)
[36] Universal relied on several decisions which refused to find any protectable interest in plaintiff's performance where such protection would significantly interfere with the use of an underlying copyrighted work. (See, e.g., Sinatra v. Goodyear Tire & Rubber Co. (9th Cir.1970) 435 F.2d 711; Booth v. Colgate-Palmolive Co. (S.D.N.Y. 1973) 362 F. Supp. 343.) Protecting plaintiffs' interest in this case does not limit Universal's ability to broadcast or advertise Dracula. Hence, those decisions are wholly irrelevant to the issues presented here.
[37] Paragraph 4 of the 1930 contract contains the grant of rights from Lugosi to Universal: "The producer shall have the right to photograph and/or otherwise produce, reproduce, transmit, exhibit, distribute, and exploit in connection with the said photoplay any and all of the artist's acts, poses, plays and appearances of any and all kinds hereunder, and shall further have the right to record, reproduce, transmit, exhibit, distribute, and exploit in connection with said photoplay the artist's voice, and all instrumental, musical, and other sound effects produced by the artist in connection with such acts, poses, plays and appearances. The producer shall likewise have the right to use and give publicity to the artist's name and likeness, photographic or otherwise, and to recordations and reproductions of the artist's voice and all instrumental, musical, and other sound effects produced by the artist hereunder, in connection with the advertising and exploitation of said photoplay." (Italics added.)
[38] On the day following the execution of that contract, Lugosi and Universal entered into an option agreement for a term contract for the exclusive use of Lugosi's services. If the parties to the September 11, 1930, contract had sought to confer on Universal the right to exploit Lugosi's likeness in merchandising commercial products, as Universal here contends, that contract could have incorporated the more specific language in the term contract attached to the September 12, 1930, option agreement. Paragraph 4 of the term contract provided in part: "The artist does also hereby grant to the producer, during the term hereof, the sole and exclusive right to make use of, and to allow others to make use of, his name for advertising, commercial, and/or publicity purposes (other than in connection with the acts, poses, plays and appearances of the artist hereunder), as well as the sole and exclusive right to make use of and distribute, and to allow others to make use of and distribute, his pictures, photographs, or other reproductions of his physical likeness and of his voice for like purposes...."
[39] Contrary to Universal's assertion, the court's interpretation of the contracts at issue in Republic Pictures Corp. v. Rogers (9th Cir.1954) 213 F.2d 662, is inapposite. First, the contracts there specifically provided for the use of the actor's name and likeness for advertising purposes unrelated to the promotion of the motion pictures involved. (Id., at pp. 663-664.) Second, the issue presented there was whether those motion pictures could be televised. The court expressly stated that it was not adjudicating the right to use the artist's name or likeness in commercial advertising. (Id., at p. 666.) In contrast, the court in Price v. Hal Roach Studios, Inc., supra, 400 F. Supp. 836, confronted with contractual language comparable to that in the present case, adopted an interpretation similar to the trial court's construction. (Id., at pp. 839-841.)
[40] "Everything which an employee acquires by virtue of his employment, except the compensation which is due to him from his employer, belongs to the employer, whether acquired lawfully or unlawfully, or during or after the expiration of the term of his employment."
[41] Universal received hundreds of thousands of dollars in additional royalties in connection with similar licensing agreements for which plaintiffs could not seek damages due to the statute of limitations.
[42] See, e.g., Sheldon v. Metro-Goldwyn Corp. (1940) 309 U.S. 390 [84 L. Ed. 825, 60 S. Ct. 681] (copyright); Orgel v. Clark Boardman Co., Ltd. (2d Cir.1962) 301 F.2d 119 (copyright); Westinghouse Co. v. Wagner Mfg. Co. (1912) 225 U.S. 604 [56 L. Ed. 1222, 32 S. Ct. 691] (patent); Carter Products, Inc. v. Colgate-Palmolive Co. (D.Md. 1963) 214 F. Supp. 383, 397 (patent); 3 Nimmer on Copyright (1978) section 14.03[C]. See also 4 Callman, The Law of Unfair Competition, Trademarks and Monopolies (3d ed. 1978) section 89.3 (a), page 285 and section 89.3 (b) pages 306-310 (trademarks).
[43] The income from one multiple character licensing agreement was allocated somewhat differently in light of specific information concerning that agreement.
[44] In Sheldon, there was evidence that 5 to 12 percent of the defendant's receipts should be allocated to plaintiff for the infringement; an award of 20 percent was upheld. (309 U.S. at p. 408 [84 L.Ed. at p. 835].) In this case, one licensing agreement proposed 25 percent of the advance royalty be allocated to Count Dracula. Further, the defendant proposed a 25 percent allocation of certain unidentified income. The trial court awarded plaintiffs 33 1/3 percent of the profits, which is comparable to the award in Sheldon.
[45] The court's findings inconsistently refer to this period as commencing "after June 30, 1972," and "from July 31, 1972." However, the record makes it clear that it is the period after June 30, 1972, which is in issue.
[46] Universal's similar claims with regard to its contracts with AA Records, Inc., and Colgate-Palmolive Co. are not persuasive. The recovery awarded in connection with the AA Records' contract related to extensions of that contract concluded after February 3, 1964. While the Colgate-Palmolive contract was ostensibly executed on December 16, 1963, the February 6, 1964, letter agreement between them provides that "[w]e are currently herewith entering into an agreement ..." for the licensing of certain horror characters. Moreover, it is the February 6th agreement which first specifies that the Count Dracula character licensed is Lugosi's portrayal of Dracula. The December 16th agreement did not so specify. Hence, there was no misappropriation of Lugosi's likeness until after February 3d, and the contract was thus properly treated by the trial court.
Given Universal's burden, I find that Universal's remaining contentions are also without merit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2248252/ | 478 N.E.2d 1214 (1985)
Jim LOWERY, Appellant (Defendant below),
v.
STATE of Indiana, Appellee (Plaintiff below).
No. 483S116.
Supreme Court of Indiana.
June 4, 1985.
Rehearing Denied July 22, 1985.
*1218 Susan K. Carpenter, Public Defender, David P. Freund, Deputy Public Defender, Indianapolis, for appellant (defendant below).
Linley E. Pearson, Atty. Gen., Michael Gene Worden, Deputy Atty. Gen., Indianapolis, for appellee (plaintiff below).
PIVARNIK, Justice.
Defendant was found guilty by a jury in the Hendricks Circuit Court in a bifurcated trial of two counts of murder and one count of attempted murder. The jury recommended the death penalty for each murder conviction. The trial court sentenced Defendant to death for the two murder convictions and to a term of fifty (50) years for the attempted murder conviction.
Fifteen issues have been presented for our determination in this direct appeal as follows:
1. whether the Indiana death penalty statute constitutes vindictive justice;
2. lack of specific rules governing the review of death sentences;
3. denial of Defendant's request for funds to hire an expert to assist counsel during jury selection;
4. refusal of the trial court to permit individual voir dire of each prospective juror;
5. denial of Defendant's Motion to Suppress;
6. error in admission of trial testimony of witness James Bennett;
7. error in admission of certain State exhibits;
8. error in admitting testimony of witness George Ross;
9. error in admission of Defendant's Exhibit E on motion of the prosecution;
10. admission of opinion testimony of Dr. Miller;
11. permission of Detective Payne to testify about a pretrial identification display;
12. allowing leading questions by the prosecution;
13. error in the giving of an accomplice instruction;
14. sufficiency of the evidence; and
15. error in finding that the aggravating factors outweighed the mitigating factors.
On September 30, 1979, Mark and Gertrude Thompson were in their country home in West Point, Tippecanoe County, Indiana. Both Thompsons were past 80 years of age, in declining health, and needed assistance in caring for themselves and their property. On that date, both were killed by gunshot in their home. Before this date, the Thompsons had employed Defendant-Appellant James Lowery and his wife as caretakers. The Thompsons, dissatisfied with the Lowerys, asked them to *1219 leave and ordered them out of the provided trailer and off the property immediately. The Lowerys refused to leave that quickly and after some discussion, Mark Thompson gave the Lowerys a check for one-hundred ($100.00) dollars in exchange for leaving immediately. Weeks before September 30, Lowery and Jim Bennett discussed committing a crime for pecuniary gain. Lowery told Bennett he knew where he could get some money, but he did not disclose the place at that time. About three weeks prior to September 30, Bennett gave Lowery a .32 caliber nickel or chrome plated pistol and some ammunition. The gun was supposedly for Barbara Lowery's protection while Lowery was not home. On September 30, Bennett picked Lowery up and followed Lowery's directions. Bennett knew, in general, that they were driving to West Point to rob Lowery's former employers. Later, Lowery told Bennett more specifically that they were going to the Thompson's residence to force Mr. Thompson to write a check for nine-thousand ($9,000.00) dollars, then kill and bury both Thompsons. He also planned to take Thompson's gun collection. As they approached the Thompson residence around dark, Lowery carried the pistol and Bennett a sawed-off shotgun.
Janet Brown, housekeeper and caretaker for the Thompsons, was sitting in the trailer where she lived, adjacent to the Thompson's garage, reading a book when she heard the Thompson's dog bark, and a man with a gun in his hand kicked the door open and entered. Brown recalled having once met the man at the West Point Post Office. She and Lowery had struck up a conversation about their motorcycles. When she told Lowery she worked for the Thompsons, he had remarked that he too had worked for them at one time. He said Mark Thompson was all right but to watch out for Mrs. Thompson as she was hateful. He recounted how they were ordered to leave the Thompsons' and how he had first requested payment of one hundred ($100.00) dollars. Brown thought Lowery spoke hatefully of the Thompsons. She identified Jim Lowery as the man who came into the trailer with a gun the evening of September 30, 1979.
After Lowery broke into Brown's trailer, he held the gun against Brown's neck and forced her to take him to the Thompson's residence. Brown saw someone with Lowery but said she did not get a good look at him. Bennett testified similarly to Brown about these events. Lowery took Brown into the kitchen where Mark Thompson was standing. He told Thompson he was being held up and then shot him in the stomach. After shooting Mark Thompson, Lowery forced Brown, with a gun to her head, through the kitchen and down the hall to the den where Gertrude Thompson was watching television. Lowery ordered Mrs. Thompson to get up and move and as she was walking down the hall, he struck her in the head with the gun. Blood spurted from her head and she began to stagger. After Lowery forced Brown and Mrs. Thompson into the kitchen, he shot Mrs. Thompson in the head and also shot Brown. Brown had her hand over her head when Lowery fired at her, causing injury to her hand and her head, but not fatally wounding her. As she lay bleeding, not sure how seriously she was injured, the burglar alarm began ringing. Mark Thompson apparently had activated it. She testified that at that time Lowery and the person with him became excited and Lowery went back to where Mark Thompson was and she heard two more shots. Lowery still wanted to find something to take from the house, but because the siren was ringing and they feared the police would come soon, Lowery and Bennett fled by way of the back roads. They returned to Lowery's place where they told Barbara Lowery about the shootings. After Lowery was apprehended by the police, he made several voluntary incriminating statements to numerous police officers. Later, in the jail cell, he admitted the perpetration of these crimes to his cellmate and detailed the manner in which they were executed.
I
Appellant claims the Indiana Death Penalty Statute violates the Indiana Constitution, *1220 Art. 1, § 18, which provides, "The penal code shall be founded on the principles of reformation and not of vindictive justice." We have reviewed this issue on many occasions and have found that the death penalty, as part of our criminal code, does not violate the Constitution. In Dillon v. State, (1983) Ind., 454 N.E.2d 845, 852, cert. denied, (1984) ___ U.S. ___, 104 S.Ct. 1617, 80 L.Ed.2d 145 we pointed out:
"[A]rticle 1, Section 18 of the Indiana Constitution is an admonition to the legislative branch of the state government and is addressed to the public policy which the legislature must follow in formulating the penal code. It applies to the penal laws as a system to insure that these laws are framed upon the theory of reformation as well as the protection of society. Schiro v. State, (1983) Ind., 451 N.E.2d 1047; Williams v. State, (1982) Ind., 430 N.E.2d 759, appeal dismissed, (1982) 459 U.S. 808, 103 S.Ct. 33, 74 L.Ed.2d 47; Brewer v. State, (1981) 275 Ind. 338, 417 N.E.2d 889, cert. denied, (1982) 458 U.S. 1122, 102 S.Ct. 3510, 73 L.Ed.2d 1384; Judy v. State, (1981) 275 Ind. 145, 416 N.E.2d 95; French v. State, (1977) 266 Ind. 276, 362 N.E.2d 834."
Defendant does not present any reason for changing our rationale and holdings in these cases. Thus, we affirm our position in the above cited cases and hold the Indiana death penalty does not violate the vindictive justice provision of the Indiana Constitution.
II
Appellant next claims the Indiana Supreme Court has failed to establish necessary rules providing for meaningful appellate review of the death sentence. This Court has already decided this issue by holding in several cases that existing Supreme Court rules appropriately provide for the meaningful appellate review of every death sentence. Burris v. State, (1984) Ind., 465 N.E.2d 171, cert. denied, ___ U.S. ___, 105 S.Ct. 816, 83 L.Ed.2d 809; Daniels v. State, (1983) Ind., 453 N.E.2d 160, reh. denied; Williams v. State, (1982) Ind., 430 N.E.2d 759, appeal dismissed, 459 U.S. 808, 103 S.Ct. 33, 74 L.Ed.2d 47, reh. denied, 459 U.S. 1059, 103 S.Ct. 479, 74 L.Ed.2d 626; Brewer v. State, (1981) 275 Ind. 338, 417 N.E.2d 889, cert. denied, 458 U.S. 1122, 102 S.Ct. 3510, 73 L.Ed.2d 1384, reh. denied, 458 U.S. 1132, 103 S.Ct. 18, 73 L.Ed.2d 1403.
For reasons expressed in these opinions, Defendant's argument fails on this issue.
III
Prior to trial Defendant filed a motion for permission to use the assistance of a juristic psychologist during the jury voir dire process at public expense. Appellant claims the trial court abused its discretion by denying this motion.
In Indiana, appointment of experts to assist the defense is a matter reversed only on a showing of abuse of discretion. Griffin v. State, (1981) 275 Ind. 107, 415 N.E.2d 60; Owen v. State, (1979) 272 Ind. 122, 396 N.E.2d 376. The same standard is applicable to capital cases wherein the accused requests expert assistance for the voir dire portion of the trial. Thomas v. State, (1984) Ind., 459 N.E.2d 373. Defendant does not give any specific reason why an expert was necessary for the voir dire questioning. On a similar question, the Seventh Circuit, U.S. District Court found that while some experts had been used in the jury selection process, this is hardly necessary for an adequate defense. U.S. v. Harris, (7th Cir.1976) 542 F.2d 1283. Defendant has failed to establish an abuse of discretion and we find no error on this issue.
IV
Prior to trial Defendant filed a written motion requesting individual voir dire examination of each prospective juror. After a hearing on the motion, the trial court determined voir dire would be done in the usual manner which does not provide the separation of prospective jurors. Appellant claims this was error.
*1221 It is well settled the trial judge has broad discretion in controlling the voir dire of prospective jurors. Partlow v. State, (1983) Ind., 453 N.E.2d 259, cert. denied (1984) ___ U.S. ___, 104 S.Ct. 983, 79 L.Ed.2d 219; Fielden v. State, (1982) Ind., 437 N.E.2d 986. In Fielden, we resolved this issue adverse to Appellant's position. We agree with the State's contentions that the trial court has other ways of protecting the impartiality of jurors, such as holding extensive individual questioning when a juror's answers indicate potential problems. Also, if the voir dire is not done individually, the jurors can be extensively questioned regarding the influence other jurors' answers may have on them. Appellant fails to demonstrate any prejudice resulting from the collective jury voir dire. Therefore, he fails to establish he was denied a fair trial by the trial court's decision. Accordingly, we find no abuse of discretion in the trial court's denial of the motion.
V
Prior to trial Defendant motioned to suppress statements made to several police officers after his arrest. The trial court granted the motion in part and denied it in part. Defendant complains that the partial denial of the motion to suppress was error. Accordingly, the testimony of Officers Bridge, Chase, and Ross regarding incriminating statements should have been excluded.
When reviewing the voluntariness of a confession or statement this Court does not weigh the evidence or judge the credibility of witnesses, but rather determines if there was substantial probative evidence to support the trial court's findings. Partlow v. State, supra; Chandler v. State, (1981) 275 Ind. 624, 419 N.E.2d 142. The State contends the testimony of all three officers was admissible because they referred to wholly volunteered and unsolicited statements by the accused which were not the product of custodial interrogation such that any advisements of rights needed to be given. Miranda v. Arizona, (1966) 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694; Tacy v. State, (1983) Ind., 452 N.E.2d 977, reh. denied; Johnson v. State, (1978) 269 Ind. 370, 380 N.E.2d 1236. In Johnson, this Court discussed interrogation as follows:
"The term `interrogation' has been defined as a process of questioning by law enforcement officials which lends itself to obtaining incriminating statements. Escobedo v. Illinois (1964), 378 U.S. 478, 485, 84 S.Ct. 1758, 1762, 12 L.Ed.2d 977, 986. Not every statement uttered by a police officer which is punctuated with a question mark will necessarily constitute an interrogation. See e.g. Bugg v. State [267 Ind. 614, 372 N.E.2d 1156 (1978)], supra. Rather, it is necessary to view the statement in the context in which it was made. If, after having done so, it does not appear that the purpose of the remark was to obtain a confession from the accused, Miranda is not triggered and it is not necessary that the accused first be advised of his rights."
Id. at 1240.
Further, in Resnover v. State, (1984) Ind., 460 N.E.2d 922, 932, reh. denied, this Court observed:
"The United States Supreme Court has held that the `interrogation' conceptualized in its Miranda opinion must reflect a measure of compulsion above and beyond that inherent in custody itself. Any statement made freely, voluntarily and without any compelling influence is admissible into evidence. Rhode Island v. Innis, (1980) 446 U.S. 291, 100 S.Ct. 1682, 64 L.Ed.2d 297; Roberts v. United States, (1980) 445 U.S. 552, 100 S.Ct. 1358, 63 L.Ed.2d 622. Innis further held that Miranda applies only to words or actions by police officers which the officers should have known were reasonably likely to elicit an incriminating response."
Officer Bridge, of the Crawfordsville Police Department, while alone with Defendant awaiting transportation for Defendant to Tippecanoe County, did not ask Defendant any question. However, Defendant voluntarily admitted to the crime and told Bridge *1222 he did it because he hated Mr. Thompson who had "ripped off" people with his law practice. He also commented that if he had not been caught he would have gone after Jack Burns, whom he heard had propositioned his wife while Defendant was in jail. He further told Bridge that Bridge would be a hero for capturing him and that he, Defendant, would be famous like Roger Drollinger. He explained he was upset with Mr. Thompson because Thompson had kicked his family and him out. He mentioned that when he heard on the radio that the housekeeper had survived, he knew he was in trouble. The evidence showed that Officer Bridge did not question Defendant at any time while waiting for transportation, nor did he discuss the case with Defendant.
Lt. Jack Chase of the Tippecanoe County Sheriff's Department testified that on October 2, 1979, he accompanied Lt. Worthington to transport Defendant to Tippecanoe County. Lt. Chase was in the back seat with Defendant. Chase did not question Defendant but did converse with him. Defendant told him, without any prompting or questioning, that Defendant's partner had brought the guns to the Thompson residence and that Defendant had fired only one shot. He did not say who his partner was, but remarked he was not concerned if someone else got shot, even if it was a policeman. Defendant further stated he probably would get the electric chair, but was hoping to get natural life instead. After arriving at the Tippecanoe County Jail Chase booked Defendant, which required him to ask only general information such as name, birthdate, etc. Chase never questioned Defendant about the crime.
On October 9, 1979, Sheriff Hager asked Sergeant George Ross, who was at Tippecanoe County Jail on business not concerning Defendant's case, to accompany him to Defendant's cell. The Sheriff informed Defendant he could shower, but when the officers were preparing to leave Defendant asked Ross to remain. Ross told Defendant he could not discuss the case with him, but Defendant persisted and told Ross that he had heard on the street that he, Defendant, was as big or bigger than Charles Manson in the area. He said he had shot Mark Thompson but not the woman. He also told Ross he had been in a mental institution at age sixteen (16) and thought his lawyers were getting the records to prove him insane.
Not one of the officers interrogated Defendant in a custodial atmosphere. Further, Defendant clearly volunteered all of the statements made to them. Thus, the officers were not required to give any warnings, even assuming they had opportunity to do so. Nor does the failure of giving Miranda warnings prior to any of the statements render them inadmissible into evidence. Resnover, supra; Partlow, supra; Tacy, supra. Appellant claims his statement to Lt. Chase regarding his preference to a life sentence rather than death was an attempt at a plea negotiation, rendering the statement inadmissible. However, the facts do not support his contention. The Court of Appeals stated in Moulder v. State, (1972) 154 Ind. App. 248, 289 N.E.2d 522, 527, "The character of the communication is the test to be applied. The communication must have as its ultimate purpose the reduction of punishment or other favorable treatment from the State to the defendant." It is clear Defendant's statement to Chase was not an attempt to negotiate for a lesser penalty, but was merely an expression of his feelings regarding the death penalty.
Defendant further claims that his attorney was not notified of the meeting between Defendant and Ross; therefore, his statements to Ross were inadmissible. We see no merit to this contention. Defendant's statements, made voluntarily, do not become inadmissible simply because Defendant's counsel was not notified or present. Sater v. State, (1982) Ind., 441 N.E.2d 1364; Kern v. State, (1981) Ind., 426 N.E.2d 385; Porter v. State, (1979) 271 Ind. 180, 391 N.E.2d 801, reh. denied. Accordingly, Appellant has not demonstrated any error on this issue.
*1223 VI
This is the second trial of Defendant Lowery on these charges. He was tried and convicted of these same charges and sentenced to death in a previous trial. That judgment was reversed by this Court on an issue unrelated to any presented in this appeal. Lowery v. State, (1982) 434 N.E.2d 868, reh. denied.
James Bennett, Defendant's accomplice, testified for the State in the first trial pursuant to a plea agreement. However, in this trial he refused, outside the presence of the jury, to testify unless he received a better deal from the State. The trial court ordered him to testify and held him in contempt when he refused. Later in the trial, the State again asked Bennett to testify but he still refused. The State then offered Bennett's testimony from a transcript of the previous trial. Since Bennett refused to testify, despite being held in contempt, the trial judge, over Defendant's objection, permitted the State to read the transcript of Bennett's testimony at the first trial to the jury. Appellant argues this evidence was erroneously admitted for it denied him the right of cross-examination. Further, he claims the State failed to establish that Bennett was unavailable, so it was error not to allow him to show that Bennett had recanted his trial testimony.
Defendant concedes the admission of former testimony of an unavailable witness is a matter committed to the discretion of the trial court. Pollard v. State, (1979) 270 Ind. 599, 388 N.E.2d 496. This Court has long recognized prior recorded testimony is an exception to the hearsay rule. Evidence consisting of a now unavailable witness' recorded testimony, given at a prior judicial proceeding where there was sufficient identity of issues with those of the present proceeding and where the adverse party had a chance to cross-examine the now unavailable witness, is admissible as evidence in the subsequent proceeding. Raines v. State, (1971) 256 Ind. 404, 269 N.E.2d 378, reh. denied; Stearsman v. State, (1957) 237 Ind. 149, 143 N.E.2d 81; Levi v. State, (1914) 182 Ind. 188, 104 N.E. 765. The unavailability of the witness may be due to "death or insanity of the former witness, the absolute impossibility of securing his presence, his absence by procurement of the defendant, or such non-residence as will preclude the taking of his deposition... ." Id. Also, it is well established that the admission of prior testimony of an unavailable witness does not violate the confrontation clause. Ohio v. Roberts, (1980) 448 U.S. 56, 100 S.Ct. 2531, 65 L.Ed.2d 597; California v. Green, (1970) 399 U.S. 149, 90 S.Ct. 1930, 26 L.Ed.2d 489. The transcript read to the jury was of a prior proceeding involving the same issues and parties and in which Bennett was subjected to full cross-examination. In California v. Green, the United States Supreme Court held a witness' refusal to testify renders him unavailable for purposes of the use of his prior testimony. Thus, Bennett's unreasonable refusal to testify rendered him unavailable and the trial court did not err by admitting Bennett's former testimony. Defendant further argues that because Bennett did not testify at this trial, Defendant was denied the ability to cross-examine Bennett about a letter written subsequent to the first trial in which Bennett attempted to recant his prior testimony. Defendant cites no authority to support this claim; therefore, the State's contention that he has waived any claim of error on this issue is well taken. Sandlin v. State, (1984) Ind., 461 N.E.2d 1116, 1118. However, as the State points out, the record further shows there is nothing to support Defendant's claim that because Bennett's prior testimony was admitted Defendant was prevented from informing the jury about Bennett's attempt to recant his trial testimony. The trial court indicated Defendant could inform the jury about statements the witness made since the taking of the transcript if they concerned the witness' credibility. However, Defendant did not attempt to present the letter after Bennett's prior testimony was admitted. Consequently, the court did not have an opportunity to rule on an offer of the letter, and there is no error presented for our *1224 review. Wells v. State, (1982) Ind., 441 N.E.2d 458, reh. denied.
Defendant further claims the trial court erred by refusing to redact portions of the former testimony of James Bennett because objections at the first trial to these portions should have been sustained. He contends the court should have considered the objections in this reading, sustained them, and excluded that testimony. Defendant refers to nine objections in the first trial. Objections one to seven relate to a conversation between Bennett and Barbara Lowery the night of the crime. Objection eight concerns a subsequent conversation with Barbara Lowery later that same night, and objection nine relates to what Bennett told the police after his arrest. With respect to objection nine, Defendant concedes that this is not hearsay and cannot be argued as such in this appeal. Defendant therefore waives the argument in consideration of this issue.
The other eight objections refer to prior out-of-court statements made by Barbara Lowery to James Bennett the night of the murders. The State contends that while Bennett's testimony may have concerned a hearsay statement, the testimony was not inadmissible hearsay since a prior out-of-court statement is permissible as substantive evidence if the declarant is available for cross-examination. Watkins v. State, (1983) Ind., 446 N.E.2d 949. Barbara Lowery testified she conversed with Bennett the night of the murders, which subjected her to cross-examination concerning the circumstances surrounding her conversation with Bennett. However, Defendant did not cross-examine her about any conversation. Contrary to Defendant's claim, Barbara Lowery was available for cross-examination regarding her statements. She did not deny making statements to him, nor was she unable to recall the statements; she simply was not questioned about them. Further, Defendant did not make any attempt to recall her to the stand to question her about conversations referred to in Bennett's prior testimony. Defendant concedes with regard to objection eight, Barbara Lowery did testify about a subsequent conversation between Bennett and Barbara Lowery, which subjected her to cross-examination about this testimony. Defendant still claims this portion of Bennett's prior testimony was inadmissible because it was a mere substitute for Bennett taking the stand and testifying at the second trial. He cites Lewis v. State, (1982) Ind., 440 N.E.2d 1125, cert. denied, (1983) 461 U.S. 915, 103 S.Ct. 1895, 77 L.Ed.2d 284, for this contention. Although Lewis denounced the use of substantive evidence of the out-of-court statement in lieu of the declarant's in-court testimony, our holding in Lewis does not prohibit the use of an out-of-court statement when the declarant has been made available for cross-examination, as appears here. Barbara Lowery testified at trial that she conversed with Bennett at his residence the night of the murders. Consequently, Bennett's former testimony concerning what she told him in that conversation was not in lieu of available testimony of the witness-declarant at trial. Defendant's objections to admission of these portions of Bennett's prior testimony were, therefore, properly overruled. Watkins, supra; Williams v. State, (1983) Ind., 455 N.E.2d 299-305; Lewis, supra.
VII
Defendant claims the trial court erred in admitting numerous State exhibits into evidence.
He first objects to the admission of State's Exhibits 76, 77, 95, and 166. Exhibit 166 was a transcript of the tape recording constituting Exhibit 95. Exhibit 95, the tape recorded statement of Defendant's former wife, Barbara Lowery, was given to the police a few days after the murders. However, Exhibit 166 was never presented to the jury, so any issue regarding its admission is moot. Lowery v. State, (1982) Ind., 434 N.E.2d 868, reh. denied. Defendant claims Exhibit 95 is inadmissible hearsay. The record shows that before Exhibit 95 was admitted into evidence and played to the jury, Barbara Lowery testified in *1225 open court regarding the statement she gave the police. Although she could not recall the details of her statements to the police, she acknowledged giving them. This issue was raised on Defendant's first appeal and we held that since the declarant was at trial and subject to cross-examination of the statement she gave the police, the tape recorded statement was admissible. We reaffirm that position here. Lowery v. State, supra. Exhibits 76 and 77 present a similar question. Exhibit 76 is a tape recording of two statements given by Janet Brown to the police while she was in the hospital on the night of the murders. Exhibit 77 is a transcript of the same statements. Defendant claims these exhibits were also inadmissible hearsay. However, before these exhibits were admitted at trial, Janet Brown testified in open court. She recalled making statements to the police at the hospital on the night of the murders and stated she recalled most of what she told the police. These exhibits were also admissible for the same reasons we held Exhibit 95 to be admissible. Lowery, supra.
Defendant objected to the admission of State Exhibits 10, 11, 13, 14, 15, 16, 18, 19, 20, 23, 26, 31, 32, 35, 36, 38, 39, 46, 47, 53, 54, and 68, photographic slides depicting the victims' residence, claiming they were cumulative and repetitive. He objected to Exhibits 106, 108, 112, 113, 116, 117, 123, 136, and 141, photographic slides of the crime scene and of the victims, including autopsy photographs, claiming these slides were unduly inflammatory and repetitious. Defendant claims Exhibit 6, a photograph of Mr. Thompson during his life, is unduly repetitious since Exhibit 5 was a photograph of Mr. and Mrs. Thompson during their lives. Exhibit 75, a photograph of the wound to Janet Brown's hand, Defendant objected to as being cumulative and superfluous. State's Exhibit 102 depicts the scene of the crime, particularly the location of Mrs. Thompson's glasses, with her hand and part of her arm showing. Defendant claims this photo was unduly repetitious of others.
It is well-settled that the admission of photographs is within the sound discretion of the trial court and will not be disturbed except for an abuse of discretion. Jones v. State, (1983) Ind., 456 N.E.2d 1025; Paige v. State, (1982) Ind., 441 N.E.2d 438. The admissibility of a photograph is dependent upon its relevancy. Ferry v. State, (1983) Ind., 453 N.E.2d 207. Admittedly, many of these photographs are gruesome. They are photographs of the scene of the murders, including the bodies of the victims. Several of the photographs were taken at different angles and show Mrs. Thompson lying in a pool of blood with her brains exposed and her entire head and face covered with blood. However, the fact that a photograph is gruesome does not render it inadmissible. Ferry, supra; Grimes v. State, (1983) Ind., 450 N.E.2d 512, 516. Defendant must show that the photographs' tendency to improperly influence the jury outweighed their probative value to the extent that they were unduly prejudicial. Strange v. State, (1983) Ind., 452 N.E.2d 927, reh. denied. Photographs of a crime scene are generally admissible because they are competent and relevant aids by which a jury can orient itself to best understand the evidence presented to it. Grimes, supra; Stewart v. State, (1982) Ind., 442 N.E.2d 1026. Even though photos are repetitious and cumulative of the crime scene, they are admissible as long as they are competent and relevant aids to the jury in orienting them and helping them to understand the evidence. Ferry, supra; Lloyd v. State, (1983) Ind., 448 N.E.2d 1062, 1070, reh. denied. Further, the admission of cumulative evidence is within the sound discretion of the trial court. Dresser v. State, (1983) Ind., 454 N.E.2d 406. Although several photographs depicted the same area, the slides indicated the photos were taken from different angles and distances and calculated to aid the jury in visualizing the crime scene, thereby helping them to understand the testimony of other witnesses. The Police testified that all of the photographic slides were true and accurate depictions of the Thompson residence and the autopsy. *1226 Defendant has failed to establish that the probative value of the slides was outweighed by their tendency to improperly prejudice the jury.
Defendant claims it was error to admit Exhibit 85, a copy of James Bennett's plea agreement, because it contained reference to polygraph examinations. The record shows that in Defendant's first appeal, Lowery v. State, supra, this Court determined the jury never saw the plea agreement or knew a polygraph examination was administered; thus, this Court found the issue to be moot. We are revisited with the same situation on this appeal. The plea agreement was received into evidence but was never submitted to the jury. Thus, the issue is moot in this appeal also.
VIII
Defendant claims the trial court erred by permitting Sergeant Ross to testify about a statement made by Defendant's wife the night of the murders, claiming this testimony was hearsay. Defendant objected when the State asked Ross to state what Mrs. Lowery told him the night of the murders about her husband's whereabouts. Although Barbara Lowery had testified previously at trial and had been cross-examined by Defendant, she was available and subject to further cross-examination by Defendant Rapier v. State, (1982) Ind., 435 N.E.2d 31; Patterson v. State, (1975) 263 Ind. 55, 324 N.E.2d 482. Defendant claims the "Patterson rule" does not permit the admission of this testimony because Barbara Lowery testified she could not recall what she told the police about the circumstances under which Defendant left the day of the murders. He claims it was, therefore, impossible to cross-examine her on that issue, citing Watkins v. State, (1983) Ind., 446 N.E.2d 949. However, Barbara Lowery was able to recall her discussion with the police on that night and affirm that she had made statements to them. Even though she was unable to recall her statements in detail, the record shows Defendant never attempted to cross-examine her about the statements Ross attributed to her, nor did he attempt to recall her for further cross-examination. Additional testimony indicated Barbara Lowery's statements to the police were not true and were made to protect the defendant. This clearly affected her credibility. However, because her testimony was generally adverse to Defendant, Sergeant Ross' testimony aided the defense, by substantiating the fact she uttered the untruths, as opposed to causing the defense harm. Further, in view of the overwhelming direct evidence indicating Defendant was guilty, including his own statements made to several witnesses, Defendant was not harmed by this alleged hearsay to the extent that it merits reversal. Brewster v. State, (1983) Ind., 450 N.E.2d 507.
IX
During Defendant's cross-examination of Barbara Lowery, defense counsel questioned her about Exhibit E, a letter written by James Bennett to Barbara Lowery. The State's objection, on the basis of hearsay, was overruled by the trial court. Defendant attempted to introduce the letter into evidence but the State objected and Defendant withdrew the offer. Defendant then used the letter to refresh the witness' recollection. On redirect examination, the State asked Barbara Lowery if she had used Exhibit E to refresh her recollection. When she testified she had, the State offered it into evidence. Defendant objected to the State's offer, claiming that it was the Defendant's exhibit and that the defense intended to offer it through another witness. The court requested a basis for the objection and defense counsel stated the exhibit lacked a foundation. Prosecution claimed a foundation was laid by showing the witness refreshed her memory from the exhibit, and as such the entire exhibit was admissible into evidence. The trial court stated, "That is the doctrine of curity admissibility, objection overruled, foundation established, Defendant's Exhibit E admitted over that objection, foundation." The letter was then read to the jury.
*1227 We fail to see any reversible error regarding this issue. The defendant indicated a desire to admit this exhibit into evidence, attempting to do so through this witness and a subsequent witness. Therefore, no harm can be shown to the defendant, and no error is presented. Brewster, supra.
X
Defendant claims the trial court erred by permitting expert witness, Dr. Miller, to give an opinion about the distance between Mrs. Thompson's head and the gun that shot the fatal blow. Defendant claims Dr. Miller was not sufficiently qualified to render this opinion. Dr. Miller testified to his formal education in medicine, including training in pathology. At the time of trial, Dr. Miller was an Associate Professor of Pathology at Purdue University. He had practiced in the field of Pathology from 1949 to 1980. During his practice he had performed an estimated 2,000 autopsies, some of which were on the bodies of gunshot victims. He participated in the autopsy on Mrs. Thompson. Miller was questioned about the gunshot wound to Mrs. Thompson's head, particularly the fact that a dark grey or black discoloration formed a ring around the wound. He testified he did not perform a microscopic examination of the discoloration and he further admitted that he was not a ballistics expert. He was questioned as to whether, based upon his prior experience as a pathologist and having examined other gunshot wounds, he had an opinion on the distance from which Mrs. Thompson was shot. Over Defendant's objection, Miller responded it was his opinion the gun was fired from approximately one foot from Mrs. Thompson's head.
It is well settled that the determination of whether a witness is qualified to testify as an expert lies in the sound discretion of the trial court. Grimes v. State, supra; Forrester v. State, (1982) Ind., 440 N.E.2d 475 at 480. Determination of the distance from which a gun was fired to the homicide victim's wound is a subject matter beyond the knowledge of the average person. In Moody v. State, (1983) Ind., 448 N.E.2d 660, this Court reiterated the rule that an expert witness is one who, by reason of education or special experience, has knowledge respecting a subject about which persons having no particular training are incapable of forming an accurate opinion or making a correct deduction. Practical experience may qualify one as an expert as readily as formal training. Warner v. State, (1983) Ind., 455 N.E.2d 355. Dr. Miller's lengthy experience in the field of pathology, including prior examinations of gunshot victims, permitted the trial court to determine he had sufficient knowledge in the field so that his opinion probably would aid the trier of fact in its search for truth. Defendant's complaints about Dr. Miller's testimony go to the weight of this testimony rather than its admissibility. Defendant has failed to demonstrate the trial court abused its discretion by permitting Dr. Miller to give his opinion as to the distance of the gun from Mrs. Thompson's head when she was killed.
XI
Janet Brown, the surviving victim of Defendant's crimes, testified at trial without objection to a photographic identification of Defendant made while she was in the hospital recovering from her injuries. Later at trial, Detective Payne was questioned about Janet Brown's identification of Defendant from the photographic display. Defendant objected to this testimony claiming it was immaterial and hearsay. The State responded that the testimony was relevant and material to the issue of identification of the perpetrator, thus corroborating the earlier testimony of Janet Brown. Further, the State contended the admission of these photographs was relevant to showing how Janet Brown was able to identify Defendant in 1979, for by the time of this trial Defendant's appearance had changed significantly. The State concedes that even though this testimony was relevant and material, the testimony complained of does fall within the definition of *1228 hearsay pursuant to Moody v. State, supra. However, Janet Brown had already provided this same evidence and her testimony was permitted without objection from Defendant. It is well settled that any error in admission of evidence is harmless if the same or similar evidence has been admitted without objection. Crafton v. State, (1983) Ind. App., 450 N.E.2d 1042. Since the testimony of Payne was cumulative of other evidence admitted without objection, the fact that it may have been hearsay does not present reversible error, particularly in view of the overwhelming evidence indicating Defendant was guilty. Moody, supra; Lottie v. State, (1980) 273 Ind. 529, 406 N.E.2d 632, 640, reh. denied. We therefore find no reversible error on this issue.
XII
Defendant complains the prosecutor often asked leading questions of its witnesses which prejudiced the defendant. The State complains Defendant waived this issue. The specification of error from Defendant's Motion to Correct Errors states:
"No. 7. The trial court erred in allowing, over repeated objection, the prosecutor to lead State's witnesses through their testimony."
In the memorandum accompanying the motion to correct errors Defendant elaborates on the specification of error by stating:
"No. 7. Throughout the trial, although objections were sometimes sustained, the prosecutor was allowed to lead the State's witnesses through their testimony. Such practice amounts to testimony by the prosecutor with the witness function to either admit or deny the testimony. Suggestion of desired responses here denied the defendant a fair trial."
The motion to correct errors did not specifically state which questions Defendant objected to as leading. It is well settled a party cannot raise a question for review by generally referring to it in the motion to correct errors and then specifically indicate what the errors were on appeal. Brumfield v. State, (1982) Ind., 442 N.E.2d 973, 974. In order to preserve error for appellate review, the alleged errors must be stated with specificity in the motion to correct errors. Prine v. State, (1983) Ind., 457 N.E.2d 217. In order to determine this issue, the trial court would have had to search the lengthy transcript to determine which, if any, of the Prosecutor's leading questions resulted in error by the trial court. Defendant's Motion to Correct Errors, therefore, does not sufficiently preserve the error for review on this appeal and we consider it waived. Brumfield, supra; Prine, supra.
XIII
The trial court, during final instruction, gave State's tendered Instruction No. 6, which was essentially a restatement of Ind. Code § 35-41-2-4 (Burns Repl. 1979), the statute establishing accessory liability. Appellant claims Instruction No. 6 is an accomplice instruction which defines culpability for aiding or abetting in the commission of a crime, and since there was no co-defendant being tried, the instruction did not apply to the issues and should have been refused. Defendant further claims that the giving of the instruction was error because it only served to confuse the jury. It is well settled that one can be charged as a principal and convicted on proof that he aided or abetted another in committing the crime. Hoskins v. State, (1982) Ind., 441 N.E.2d 419. Instructions on an accused's liability as an accessory are proper where the accused is charged as a principal, assuming the evidence supports such instructions. Lawson v. State, (1980) 274 Ind. 419, 412 N.E.2d 759, cert. denied. (1981) 452 U.S. 919, 101 S.Ct. 3057, 69 L.Ed.2d 424. See also Ward v. State, (1982) Ind., 438 N.E.2d 966. Defendant and Bennett were friends. Weeks before the murders, they discussed committing a crime for monetary gain. Defendant told Bennett he knew where they could obtain some money and on the day of the crime Defendant and Bennett were together in the afternoon, planning the crimes. Defendant had ammunition and a pistol, which Bennett had given him, and Bennett had a sawed-off *1229 shotgun. As planned, Defendant and Bennett, in concert, perpetrated the robbery of the Thompson home, although all of the evidence clearly showed Defendant shot and killed the Thompsons and wounded Brown. Since each aided the other, the acts of each can be imputed to both. Each is liable for everything done by his confederate which follows incidental to the execution of the common design, even though it was not originally intended as part of the scheme. Hoskins, supra. Therefore, although Bennett was not being tried with Lowery, it was proper for the court to instruct the jury on this subject. We see no error in the giving of the accomplice instruction. Hoskins, supra; Lawson, supra.
XIV
Defendant next contends there was insufficient evidence to sustain the jury's verdicts of guilty on two counts of murder and one count of attempted murder. He argues that since the testimony of Officers Chase, Bridge, and Ross and the former testimony of James Bennett was improperly admitted, we should not consider such testimony. As we already indicated, the testimony of Bennett, Bridge, Chase, and Ross was properly admitted; thus, it is evidence we will consider.
The well settled standard and scope of review for sufficiency of evidence challenges is that we do not reweigh the evidence nor judge the credibility of witnesses, but consider only evidence most favorable to the State and all reasonable inferences to be drawn therefrom. When there is substantial evidence of probative value to support the conviction, the finding of the trier of fact will not be disturbed. Smith v. State, (1983) Ind., 455 N.E.2d 346; Pavone v. State, (1980) 273 Ind. 162, 402 N.E.2d 976, reh. denied. Defendant claims Bennett's testimony, incriminating the defendant, came from an unsavory source and should not be considered. This, of course, is a matter of credibility going to the weight of the evidence and for the determination of the jury. Id. The uncorroborated testimony of an accomplice is sufficient to support a conviction. Stewart v. State, (1982) Ind., 442 N.E.2d 1026; Pavone, supra. In addition to Bennett's testimony, however, Janet Brown gave an eyewitness account of Defendant's commission of these crimes, unequivocally identifying Defendant as the perpetrator. McBrady v. State, (1984) Ind., 459 N.E.2d 719. These witnesses' testimony was corroborated by other witnesses and Defendant by his statements to police officers and a cell mate. There was more than sufficient evidence to justify the jury in arriving at the verdicts they returned.
XV
Defendant claims the death penalty was improperly imposed for the following reasons: the aggravating factors do not outweigh the mitigating factors; the jury's recommendation is insufficient; the trial court did not state the aggravating factors were found beyond a reasonable doubt; and the trial court's finding that the murders were committed while attempting a robbery is improper as it differs from the facts charged.
With respect to Defendant's claims regarding the jury's general sentencing recommendation, the trial court's failure to specifically state that the aggravating factors were found beyond a reasonable doubt and the court's finding that the murders were committed during a robbery, the record shows Defendant did not raise these issues in his motion to correct errors. He raised them for the first time on this appeal. The failure to properly raise issues in the Motion to Correct Errors generally results in a waiver of the claimed errors. Badelle v. State, (1983) Ind., 449 N.E.2d 1055; see Brewer v. State, (1981) 275 Ind. 338, 417 N.E.2d 889, cert. denied, (1982) 458 U.S. 1122, 102 S.Ct. 3510, 73 L.Ed.2d 1384, reh. denied, (1982) 458 U.S. 1132, 103 S.Ct. 18, 73 L.Ed.2d 1403. Since the death penalty was imposed in this cause, however, we will review the state of the record concerning these questions.
*1230 The general recommendations returned by the jury did not expressly use the language of findings beyond a reasonable doubt. The jury returned prepared forms with final instructions printed thereon. The trial judge, however, thoroughly and adequately instructed the jury, pursuant to Ind. Code § 35-50-2-9 (Burns Rep. 1979), how they were to weigh the evidence and determine whether to recommend the death sentence. Further, the trial judge instructed the jury, more than once, that before they could return a recommendation of death they must make a finding that the State proved at least one of the aggravating circumstances beyond a reasonable doubt. He specified that if they did not find at least one aggravating circumstance existed beyond a reasonable doubt, they could not recommend the death penalty. He also stated that if they found at least one aggravating circumstance existed beyond a reasonable doubt, then they could recommend the death penalty. He further told them they must consider any mitigating circumstances and find the aggravating circumstances outweighed the mitigating circumstances before they could return a recommendation of death. He then recited each mitigating circumstance provided in Ind. Code § 35-50-2-9 and instructed them to consider whether or not those mitigating circumstances outweighed the aggravating circumstances concerning the recommendation of the death penalty. Clearly, the jury was instructed that before they could return a recommendation of death on the appropriate form the trial judge had given them, they were required to make findings beyond a reasonable doubt. On appeal it is presumed the jury obeyed the trial court's instructions. Woolston v. State, (1983) Ind., 453 N.E.2d 965. Defendant does not offer any evidence indicating otherwise. Further, the jury only recommends whether to impose the death sentence; the trial judge makes the final decision. Ind. Code § 35-50-2-9; Schiro v. State, (1983) Ind., 451 N.E.2d 1047, cert. denied, (1983) ___ U.S. ___, 104 S.Ct. 510, 78 L.Ed.2d 699. Given the above facts, we can only conclude the jury made their findings beyond a reasonable doubt, such that no error has been shown.
Although Defendant's claim that the trial court's findings for sentencing do not use the expression "beyond a reasonable doubt" is true, it is apparent the trial judge knew and understood well the nature of the findings and made them in accordance with the law. This is first indicated by his instructions to the jury in which he told them that they would make a recommendation and he would make the ultimate findings. At the sentencing, the trial judge stated the law required him to find aggravating and mitigating circumstances and instructed the court reporter to make his findings part of the record in this cause. He then stated he would review the aggravating and mitigating circumstances and make his findings of fact as required by Indiana law. It is apparent he would do so pursuant to Ind. Code § 35-50-2-9. The judge then expressly found Defendant intentionally killed these victims while attempting to rob them and was motivated by pecuniary gain. He found the victims of the crime were aged and defenseless people who did not induce or provoke Defendant to commit the crimes or take part in them in any way. The Judge further found Defendant acted under no one's domination, but acted in a cold blooded, planned manner by killing two defenseless people and attempting to kill another. The judge then went through each of the mitigating circumstances articulated in Ind. Code § 35-50-2-9 and disposed of them. He first found Defendant's conduct caused and threatened serious bodily harm in that it resulted in the killing of two people and the attempted killing of a third, that the defendant contemplated that his criminal conduct would cause or threaten serious bodily injury since "you specifically told this jury and the people in this court that you went up there to kill them... ", (Record at 205), that there was no provocation from the people to cause the actions against them from the defendant, that there was no excuse or justification for the criminal conduct, that the defendant did *1231 have a substantial criminal record, that there was no excuse because of youth or old age that would support a finding that Defendant lacked substantial judgment in committing the offenses, that Defendant was not acting from a desire to provide necessities for his family or himself, that Defendant was not suffering from a mental or physical condition that reduced his capability, and that Defendant did not in any manner assist authorities or help in any manner in the solution of this cause but rather thwarted the authorities in attempting to hide and blame it on others. The court then found that there were no mitigating factors favoring Defendant and that the record revealed nothing short of a brutal, cold blooded, pre-planned killing of elderly people. The record amply supports the trial judge in all of his findings regarding aggravating and mitigating circumstances and his findings are sufficient to satisfy the requirements of § 35-50-2-9. Daniels v. State, (1983) Ind., 453 N.E.2d 160.
Defendant also complains that the trial court's findings that the murders were committed while Defendant was attempting a robbery is an improper finding as the charges stated the murder was committed during a burglary. We do not find the trial court's characterization of the aggravating factor improper or prejudicial to the defendant. First, Defendant did not raise this alleged error in his motion to correct errors. Second, burglary is the breaking and entering of a building or structure of another with intent to commit a felony therein. Ind. Code § 35-43-2-1 (Burns Repl. 1979). It is apparent and clear here that Defendant entered this property with intent to commit the felony of robbery. That is what he was doing at the time he committed these murders. He went there with the express purpose of obtaining money and property from the Thompsons. Even after he had committed the crimes and the alarm was sounding, he expressed a desire to continue finding something to take with him. The only thing that prevented him was fear he would be caught. We see no error on this issue.
Defendant contends his past experiences in mental institutions and lack of parental love and guidance are an overriding and mitigating factor. The trial court, after expressly reviewing the entire record for possible mitigating factors, could not isolate a single mitigating factor. The court was not required to believe Defendant's prior parental problems and experiences in mental institutions were mitigating factors. Allen v. State, (1983) Ind., 453 N.E.2d 1011. The trial court's consideration of aggravating and mitigating circumstances is discretionary and since the record clearly supports the judge's findings, we do not find he abused his discretion. Green v. State, (1983) Ind., 451 N.E.2d 638.
An examination of the entire record, pursuant to our responsibility to review the imposition of the death penalty, clearly supports the conclusion that imposition of the death penalty was appropriate, considering the nature of the offense and the character of the defendant. As this opinion already amply demonstrates, there was proof beyond a reasonable doubt that this defendant intentionally killed the Thompsons. He expressed animosity toward them because of his prior relationship with them and further expressed a desire and intent to get money and property from them. The trial judge told the defendant during sentencing, "I can find no factor that mitigates in your favor in this case. You have nothing going for you except a brutal cold blooded pre-planned killing of old people." (Record at 207). At another point he stated, "There are no, there is no justification and not even the wildest theorist can provide the justification for what you did under any circumstances of logic or reason." (Record at 205). The record patently shows the egregious nature of these offenses and the character of this offender. The trial court carefully complied with the proper procedures pursuant to statute and case law, and we find that the imposition of death, recommended by the jury and imposed by the trial court, was not arbitrarily *1232 or capriciously arrived at and is reasonable and appropriate.
We affirm the trial court in its judgment, including its imposition of the death penalty. This cause is accordingly remanded to the trial court for the purpose of setting a date for the death sentence to be carried out.
GIVAN, C.J., and HUNTER, J., concur.
DeBRULER, J., concurs and dissents with separate opinion.
PRENTICE, J., concurs in result with separate opinion.
PRENTICE, Justice, concurring in result.
I concur in the majority opinion insofar as it affirms the Defendant's conviction.
With respect to the sentence of death, I am of the opinion that there was a rational basis for its imposition and that it should, therefore, be affirmed under our rules.[1] For the reasons expressed in my concurring and dissenting opinion in Schiro v. State (1983), Ind., 451 N.E.2d 1047, 1068, I agree with Justice DeBruler that Defendant's history of mental disturbance may not be disregarded in the weighing process; and I, therefore, believe that the trial court's statement, "I can find no factor that mitigates in your favor in this case" was an unfortunate choice of words that, standing alone, would suggest error. In context, however, it is apparent to me that the court did not ignore that history. He previously made a finding that Defendant was not suffering from a mental condition that reduced his capabilities. I take this statement to mean that Defendant's mental disability was not so extensive as to have been a substantially contributing factor to his crimes. Also, the court found specifically: "There is nothing in this record to indicate that you were under the influence of any mental or emotional disturbance when you committed these murders and attempted murder."
I also note that counsel has not argued that no consideration was given to the Defendant's unfortunate history of mental disturbances. For these reasons, I am comfortable in my belief that the trial judge did, in fact, give some consideration to this matter, although his statement, first above quoted, suggests otherwise. The weight that he accorded to that circumstance is reserved to his discretion.
DeBRULER, Justice, concurring and dissenting.
The death sentence statute, and particularly I.C. § 35-50-2-9(e), sets forth the final essential step for the jury to take in arriving at its recommendation, and for the judge to take in arriving at the sentence. The jury and the judge must place the total positive value of the alleged, enumerated and proven aggravating circumstance or circumstances on one side of the scale, and place the net positive value of any mitigating circumstances on the other side of the scale, and thereby establish whether or not the latter is outweighed by the former. A recommendation of death, and the death sentence itself can only be made when the net positive value of any mitigating circumstances is less than the total positive value of the alleged, enumerated and proven aggravating circumstance or circumstances. At this final stage, no other values are relevant.
It was laid down in Judy v. State (1981), 275 Ind. 145, 416 N.E.2d 95, that in the death sentencing situation there are "aggravating factors" followed by Schiro v. State (1983), Ind., 451 N.E.2d 1047 that there are "counter arguments to any possible mitigating circumstances available to *1233 the defendant," which factors or counter arguments operate to negate the existence of or negate the positive value of possible mitigating factors, as for example where a gross history of prior dangerous criminal conduct negates the possible mitigating circumstance which exists when the "defendant has no significant history of prior criminal conduct," under I.C. § 35-50-2-9(c)(1). However, to use a gross history of prior dangerous criminal conduct to diminish the net positive value of other legitimate mitigating circumstances, would be to transform it into an "enumerated" aggravating circumstance, contrary to the statute. That would be tantamount to placing such history on the one side of the scale with the alleged, enumerated and proven aggravating circumstance or circumstances. As I read this statute that would be contrary to the command of the statute that the net positive value of alleged, enumerated and proven "aggravating circumstances" be determined, and then the net positive value of any mitigating circumstances be determined, and then the two values compared. This comparison as contemplated by the statute can only exist and be enforced where we restrict "aggravating factors", and "counter arguments to any possible mitigating circumstances available to the defendant" to their office of demonstrating the absence of particular, express, and discrete mitigating circumstances.
The trial court in its record of sentencing procedures evaluated aggravating circumstances as follows:
* * * * * *
The aggravating circumstances that I am going to find in this case, find (1) that you committed these murders intentionally killing victims while attempting to rob them and that you acted out of motives for pecuniary gain. Doing that, committing a crime for pecuniary gain is a, an especially aggravated offense and that is an offense that is particularly subject to principles of law that I will find later on.
I will find also that the victim in this crime, the victims in this crime were particularly helpless and defenseless people.
I will find that you have been convicted of another murder.
I have to look at mitigating circumstances also. The law says that I need to find that you have no particular history of prior criminal conduct. This is not true. The Pre-Sentence Investigation indicates that since the age of 16 you have only been on the outside approximately three years.
* * * * * *
This excerpt is followed by a continued retailing and consideration of the mitigating circumstances expressly set forth in the statute. It is starkly clear here that the trial court found what it considered to be three aggravating circumstances, and places them on one side of the life-death scales. One of these is the fact that the unfortunate victims of this homicide were two helpless and defenseless people. While true, that fact, and the manner in which it reflects appellant's dangerous character, is not an aggravating circumstance upon which the death sentence may rest. Such finding is surely error, and requires a remand for a new sentencing hearing.
Furthermore, according to the uncontradicted evidence before the court on sentencing, appellant was committed by due course of law to two separate psychiatric hospitals between the ages of 16 and 18. I can find no basis at all for not giving this fact some positive weight as a mitigating circumstance. That confinement was followed by immediate and continuous anti-social and criminal behavior. This is not to say that there is an excuse or justification in this prior time in mental hospitals for appellant's crimes. It is rather to say that such hospitalization cannot simply be declared benign in arriving at the sentence of death. For this reason also, I would set aside the death sentence and remand for a new sentencing hearing. I concur however in affirming the convictions.
NOTES
[1] 2. SCOPE OF REVIEW
(1) The reviewing court will not revise a sentence authorized by statute except where such sentence is manifestly unreasonable in light of the nature of the offense and the character of the offender.
(2) A sentence is not manifestly unreasonable unless no reasonable person could find such sentence appropriate to the particular offense and offender for which such sentence was imposed."
Ind.R.App.Rev.Sen. 2. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1106565/ | 407 So.2d 907 (1981)
Alvin Bernard FORD, Petitioner/Appellant,
v.
STATE of Florida, Respondent/Appellee.
Nos. 61440, 61450.
Supreme Court of Florida.
December 4, 1981.
Laurin A. Wollan, Jr., Tallahassee and Raymond W. Russell, Fort Lauderdale, for petitioner/appellant.
*908 Jim Smith, Atty. Gen. and Joy B. Shearer, Asst. Atty. Gen., West Palm Beach, for respondent/appellee.
PER CURIAM.
We have for consideration an appeal from an order of the circuit court denying a motion for post-conviction relief, an original petition for writ of habeas corpus, and an application for stay of execution.
Petitioner Ford was convicted of murder in the first degree. A separate sentencing proceeding was held before the trial jury, which recommended that petitioner be sentenced to death. The trial judge, in accordance with the jury's recommendation, sentenced him to death. The judgment and sentence were affirmed by this Court. Ford v. State, 374 So.2d 496 (Fla. 1979).
The Supreme Court of the United States denied a petition for writ of certiorari. Ford v. Florida, 445 U.S. 972, 100 S.Ct. 1666, 64 L.Ed.2d 249 (1980).
Petitioner has also challenged his conviction by filing a habeas corpus proceeding in this Court, in which he joined 122 other persons under sentence of death, challenging this Court's purported review of extra record material in capital appeals. Relief was denied in Brown v. Wainwright, 392 So.2d 1327 (Fla. 1981), cert. denied, ___ U.S. ___, 102 S.Ct. 542, 70 L.Ed.2d 407 (1981).
Petitioner further challenged his conviction and sentence in a motion for post-conviction relief filed in the circuit court. Petitioner has appealed from the order denying this motion for post-conviction relief. The state has filed a motion to quash this appeal and a motion to affirm the trial judge.
Petitioner has also filed with this Court a petition for writ of habeas corpus arguing that counsel for him failed to present to this Court meritorious issues relating directly to the validity of the conviction and sentence in this case and thereby deprived him of a meaningful direct appeal in contravention of the sixth, eighth, and fourteenth amendments to the Constitution of the United States. He asks that we grant him a belated appellate review from the judgment and death sentence of the trial court.
Rule 3.850, Florida Rules of Criminal Procedure, authorizes the use of post-conviction relief procedures to challenge a once final judgment and sentence in limited instances, and for limited reasons. An error that may justify reversal on direct appeal will not necessarily support a collateral attack on the final judgment. Witt v. State, 387 So.2d 922 (Fla. 1980), citing U.S. v. Addonizio, 442 U.S. 178, 99 S.Ct. 2235, 60 L.Ed.2d 805 (1979).
Finality is an important element of the criminal justice system. This doctrine of finality should be abridged only when a more compelling objective appears, such as insuring fairness and uniformity in individual adjudication. Witt v. State.
Petitioner's motion to vacate filed with the trial court alleged five grounds for relief. Only one of these the claim of ineffective assistance of trial counsel was properly raised. The other four issues pertaining to the admissibility of the confession, jury selection under Witherspoon v. Illinois, 391 U.S. 510, 88 S.Ct. 1770, 20 L.Ed.2d 776 (1968), jury instructions during the sentencing phase, and the standard of proof used in the sentencing phase, were all matters known at the conclusion of the trial which could have been, but were not, raised on direct appeal. Accordingly, collateral attack through a Florida Rules of Criminal Procedure 3.850 motion was properly determined by the trial court not to be an appropriate remedy pursuant to this Court's decisions in Witt v. State and Hargrave v. State, 396 So.2d 1127 (Fla. 1981). See also Wainwright v. Sikes, 433 U.S. 72, 97 S.Ct. 2497, 53 L.Ed.2d 594 (1977).
The standard by which the effectiveness of counsel is to be measured is whether counsel was reasonably likely to render and rendered reasonably effective assistance. Meeks v. State, 382 So.2d 673 (Fla. 1980). In Knight v. State, 394 So.2d 997 (Fla. 1981), this Court set out a four-pronged test for determining whether there was reasonably effective assistance:
*909 1. The specific act or omission upon which the claim is based must be detailed in the appropriate pleading.
2. The defendant has the burden to show it was a substantial and serious deficiency measurably below that of competent counsel.
3. The defendant has the burden to show that under the circumstances of his case, he was prejudiced to the extent that there is a likelihood that the deficient conduct affected the outcome of the court proceedings.
4. If the defendant shows this, the state may rebut by showing beyond a reasonable doubt that there was no prejudice in fact even if a constitutional violation was involved.
In his 3.850 motion to vacate petitioner presented four categories of "specific omissions" to support the claim of ineffectiveness of trial counsel: (i) failure to adequately present the motion to suppress petitioner's statement made to law enforcement officers after he indicated he wanted to consult an attorney, (ii) failure to adequately prepare for trial, (iii) failure to adequately present issues during the guilt phase of the trial, and (iv) failure to adequately present or preserve issues during the sentencing phase of the trial. After a careful review of the record of proceedings on the motion to vacate, particularly the testimony of the lawyer witnesses called by petitioner, we conclude that either the alleged deficiencies have not been demonstrated to be substantial and serious, measurably below conduct expected of competent counsel or that petitioner was not prejudiced to the extent that there is a likelihood that the deficient conduct affected the outcome of petitioner's trial. For example, insofar as the petitioner's statement is concerned, it is far from clear that the statement was inadmissible under the state of the law existing at the time of trial. Witt v. State, Meeks v. State. Furthermore, petitioner's statement only admitted his presence and participation in the robbery. It denied participation in the shooting. There was abundant evidence apart from the confession, some by eye witnesses, to place him at the scene as a participant. Even disregarding petitioner's confession there was overwhelming evidence of guilt. To establish prejudice, there must be a serious doubt of the defendant's guilt. Canary v. Bland, 583 F.2d 887, 894 (6th Cir.1978). To the same extent the purported deficiencies at the sentencing phase can be readily attributed to tactics of counsel under the circumstances of the case. In any event, the overwhelming nature of the aggravating circumstances precludes any likelihood that counsel's alleged omissions could have been prejudicial to petitioner.
Accordingly, applying the standard of Meeks and Knight we agree with the finding of the trial court that "the assistance of his counsel was ... as effective as it could have been expected to be done under these circumstances."
Petitioner raises the following grounds in asserting ineffective appellate counsel in his petition for writ of habeas corpus: (i) failure to raise the issue of denial of assistance of counsel during interrogation, (ii) failure to raise denial of petitioner's right to a fair and impartial jury under Witherspoon v. Illinois, 391 U.S. 510, 88 S.Ct. 1770, 20 L.Ed.2d 776 (1968), (iii) failure to attack the adequacy of the trial court's instruction to the jury at the sentencing phase, (iv) failure to challenge findings of aggravating and mitigating circumstances, and (v) failure to appeal non-disclosure of a witness. Applying the four-pronged test of Knight v. State to each of these claims, we find that petitioner has failed to meet his burden of showing a substantial and serious deficiency, measurably below that of competent counsel. Even if we assumed this aspect of the Knight test were met, there is not a sufficient showing that any of these grounds would likely have affected the outcome of the appeal.
The order of the trial court denying the motion to vacate is affirmed, the petition for writ of habeas corpus is denied, and the application for stay of execution is denied. No petition for rehearing will be entertained.
*910 SUNDBERG, C.J., and ADKINS, BOYD, OVERTON, ALDERMAN and McDONALD, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1102276/ | 714 So.2d 258 (1998)
STATE of Louisiana
v.
Terrance J. WILLIAMS.
No. 97-KA-1135.
Court of Appeal of Louisiana, Fifth Circuit.
May 27, 1998.
*259 Bruce G. Whittaker, Louisiana Appellate Project, Gretna, for Appellant Terrance Williams.
Paul D. Connick, Jr., District Attorney, Thomas J. Butler, Assistant District Attorney, Research and Appeals, Gretna, for Appellee State.
Before GAUDIN, WICKER and CANNELLA, JJ.
CANNELLA, Judge.
Defendant, Terrance J. Williams, appeals from his conviction of second degree murder. We affirm the conviction and sentence for second degree murder, reverse the conviction of contempt and vacate the sentence and remand.
On January 25, 1995, defendant and Sedric Robinson (Robinson) were charged with the first degree murder (La. R.S. 14:30) of Jason Paul Bies (Bies) by a Jefferson Parish Grand Jury indictment. Defendant was arraigned on February 16, 1996 and pled not guilty.
On October 16, 1996, the trial court took up defendant's motions to suppress evidence, statements and identification and held them open. On June 17, 1997, the trial court denied the motions to suppress the evidence and identification. The record does not show that the trial court ruled on the motion to suppress statements.[1] On the same day, the state reduced the charge against defendant to second degree murder (La. R.S. 14:30.1) and the case proceeded to trial as to him only. On June 18, 1997, a jury of twelve persons found defendant guilty of second degree murder.
On June 25, 1997, defendant filed a motion to set aside the jury verdict. The motion was denied in open court on July 25, 1997.[2] Defendant waived sentencing delays and the trial court sentenced him that day to the mandatory term of life imprisonment, without benefit of parole, probation or suspension of sentence. Defendant was disorderly during sentencing and the trial judge found him in contempt of court and sentenced him to six months imprisonment without hard labor.
Robinson testified at trial for the state under an agreement by which he was allowed to plead guilty to accessory after the fact to *260 murder. He testified that, on October 26, 1995 at approximately 1:00 p.m., defendant telephoned him to ask for a ride to his girlfriend's house. Robinson stated that defendant was a friend whom he had met through his job as an Orleans Parish deputy sheriff. After Robinson picked up defendant, defendant asked him to drive to the apartment of a mutual friend, Bies. Bies was a former deputy sheriff whom Robinson had met at work.
They arrived at Bies' apartment at about 2:15 p.m. Bies greeted them at the door, welcomed them inside and invited them to sit. According to Robinson, defendant asked to see Bies' guns. Bies went into a back room and returned with a box containing a nine millimeter handgun. Bies removed the clip and handed the gun to defendant. After inspecting it, he returned it to Bies. Then, defendant showed Bies two handguns. After removing a clip, he handed them to Bies.[3] Bies looked at the guns, then returned them to defendant. Defendant then asked Bies whether he had "hooked up that deal for me." Bies said that he had paged the man in question, but had received no response. Defendant asked to see another gun of Bies. Bies retrieved a shotgun that he used for hunting. After showing the gun to defendant, Bies then returned it to the back room. While he was gone, Robinson twice asked defendant if he was ready to leave. Defendant did not answer either time. Bies returned to the front room and defendant asked for another look at the nine millimeter weapon. After Bies handed the gun to defendant, defendant pointed his own gun at Bies. Defendant asked, "Bitch, where's it at?" Bies responded that he did not know what defendant meant. Defendant said, "Bitch, you know what I'm talking about." Bies told defendant to stop playing around. Defendant responded, "Bitch, you think I'm playing?" Defendant then shot Bies in the forehead. Robinson testified that defendant was standing about one and one-half feet away from Bies when he fired the shot and that Bies was sitting on a sofa. Robinson testified that Bies did nothing to provoke the shooting. Defendant next ordered Robinson to search the apartment for valuables while he kept watch outside the front door. Robinson went to the back of the apartment and watched defendant through a window. He saw a white woman in her twenties walk past defendant. After defendant returned to the apartment, he asked Robinson if he had found anything. Robinson said that he had not, but defendant searched the bedroom anyway. As they were leaving the apartment, defendant pointed his gun at Bies again and said that he was going to have to "Pop this bitch one more time." Robinson stopped defendant, telling him not to shoot because Bies was dead. Robinson drove defendant to a nearby convenience store where defendant made a call on a pay telephone. Robinson returned home after driving defendant to his girlfriend's house. Robinson did not contact the police, but told his friend, Monica Spurlock (Monica), about the shooting. Some weeks later, Robinson fled to Texas.
Pamela Dinicola (Dinicola), the girlfriend of Bies, arrived at Bies apartment between 3:40 and 3:45 p.m. that afternoon to find him sitting on the couch, moaning and bleeding profusely. Bies was unable to move or speak. Dinicola telephoned for emergency assistance. Paramedic Danny Gurtner (Gurtner) testified that he received the dispatch at 3:39 p.m. When Gurtner and his partner Jonathan Jones arrived at the scene, Bies was still alive. They administered first aid and transported Bies to Meadowcrest Hospital where he later died.
Deputy Troy Irsch of the Jefferson Parish Sheriff's Office (JPSO) was the first officer to arrive at the apartment. He secured the scene. He testified that he did not detect any signs of forced entry. Deputy Charles Pittman, a crime scene technician of the JPSO, photographed the scene and collected evidence, including a .40 caliber expired cartridge case found next to the sofa.
Lt. Maggie Snow, a homicide detective with the JPSO, supervised the investigation. Upon investigating at the scene, she located *261 a witness, Carista Ramage (Ramage), who said that she lived next door to Bies' apartment and that upon walking to her door earlier that day, she saw a man standing in the doorway of Bies' apartment and another next to a nearby air conditioning unit. Ramage gave a description to police artist Major Tom Gordon, who developed a composite sketch of one of the suspects. On November 7, 1995, Lt. Snow showed Ramage a lineup of eight photographs. Ramage identified defendant as one of the men she had seen on the day of the murder. She stated that she was ninety per cent certain of her identification.
Deputy United States Marshal Ronnie Johnson testified that on November 15, 1995 he went to a house on Breckenridge Drive in Harvey, where he believed defendant was living. He was accompanied by several other marshals and officers from the New Orleans Police Department.[4] Deputy Johnson knocked on the door for several minutes, but got no response. Another officer spotted defendant through a window of the residence. A neighbor confirmed that defendant was living in the house.
Eventually the officers used force to enter the house. They ordered defendant to lie face down on the floor and handcuffed him. Defendant was placed under arrest. The officers performed a protective search of the house and found another man and a woman there. The officers discovered an assault rifle in plain view in the bedroom that defendant was using. A second assault rifle was found in a back bedroom. At that point Deputy Marshal Dysart advised defendant of his Miranda rights. The officers requested defendant's permission to search the house. Defendant gave his consent to search everything, except a safe which belonged to someone else. Deputy Johnson asked defendant if there were any other guns in the house. Defendant stated that there was a .40 caliber Glock pistol in his bedroom under a chest of drawers. The officers found the gun in the place indicated, recovered two magazines with clips and did not immediately remove the guns from the premises, but secured the house while a search warrant was obtained.
Lt. Snow was dispatched to the arrest scene, where the marshals showed her the Glock pistol and the dresser under which it was found. On top of the dresser was a business card with Jason Bies' name (spelled "Beez"), telephone number and beeper number hand written on the back. Captain Louise Walzer, an expert in forensic firearms examination, test fired the Glock pistol and determined that the cartridge case found at the murder scene was fired by that weapon.
Based on information from Robinson's girlfriend, Lt. Snow obtained an arrest warrant for Robinson. He was arrested in Texas on December 20, 1995, but was not extradited to Louisiana until October of 1996. On October 18, 1996, in the presence of his attorney, Robinson gave a tape recorded statement to Lt. Snow which was corroborated by other evidence collected in the case.
Dr. Frasier Mackenzie performed an autopsy on Bies. He testified that the victim died of a gunshot wound to the head with perforating wounds to the brain. The bullet took a track from above to below, indicating that the victim was sitting and the gunman standing. Dr. Mackenzie recovered a bullet pellet and a bullet jacket from Bies' head.
ANDERS APPEAL
On appeal, defendant's appellate counsel filed an "Anders" brief, asserting that, after a detailed review of the record, counsel could not find any ruling of the trial court or non-frivolous issues to raise on appeal. Counsel states that he forwarded to defendant a copy of the brief he filed with this court. However, counsel did request a review for patent error. He also filed a motion to withdraw, pursuant to Anders v. California, 386 U.S. 738, 87 S.Ct. 1396, 18 L.Ed.2d 493, reh. denied, 388 U.S. 924, 87 S.Ct. 2094, 18 L.Ed.2d 1377 (1967).
In State v. Jenkins, 94-72 (La.App. 5th Cir. 11/29/94), 646 So.2d 1197, 1198, we stated:
Under Anders v. California, 386 U.S. 738, 87 S.Ct. 1396, 18 L.Ed.2d 493 (1967), *262 and Lofton v. Whitley, 905 F.2d 885 (5th Cir.1990), counsel's failure to assign error or to assign only a request for error patent review has the effect of depriving the indigent defendant of effective assistance of counsel. However, the United States Supreme Court in Anders, also set forth the procedure to follow when, after a diligent and conscientious review of the record, counsel fails to find any non-frivolous appealable issues. In Anders, the court stated:
The constitutional requirement of substantial equality and fair process can only be attained where counsel acts in the role of an active advocate in behalf of his client, as opposed to that of amicus curiae. The no-merit letter and the procedure it triggers do not reach that dignity. Counsel should, and can with honor and without conflict, be of more assistance to his client and to the court. His role as advocate requires that he support his client's appeal to the best of his ability. Of course, if counsel finds his case to be wholly frivolous, after a conscientious examination of it, he should so advise the court and request permission to withdraw. That request must, however, be accompanied by a brief referring to anything in the record that might arguably support the appeal. A copy of counsel's brief should be furnished the indigent and time allowed him to raise any points that he chooses; the courtnot counselthen proceeds, after a full examination of all the proceedings, to decide whether the case is wholly frivolous. If it so finds it may grant counsel's request to withdraw and dismiss the appeal insofar as federal requirements are concerned, or precede to a decision on the merits, if state law so requires. On the other hand, if it finds any of the legal points arguable on their merits (and therefore not frivolous) it must, prior to decision, afford the indigent the assistance of counsel to argue the appeal. Anders, 386 U.S. at 744, 87 S.Ct. at 1400.
The United States Fifth Circuit, Court of Appeals applied Anders to the case where defense counsel files a brief solely asking for an error patent review. The court determined that, by so doing, counsel effectively withdrew without complying with the requirements of Anders. Lofton v. Whitley, 905 F.2d at 887 (5th Cir.1990).
Defendant's appellate counsel complied with the procedure approved by the United States Supreme Court in Anders and State v. Benjamin, 573 So.2d 528 (La.App. 4th Cir. 1990), adopted in State v. Bradford, 95-929 (La.App. 5th Cir. 6/25/96), 676 So.2d 1108. The state notes in its appeal brief that it finds no non-frivolous issues in the record. Defendant filed a brief in response to the letter issued by this court.
ANDERS REVIEW
An examination of the record in the instant case was conducted by the court, consisting of (1) a review of the bill of information to ensure that defendant was properly charged, (2) a review of all minute entries to ensure that defendant was present at all crucial stages of the proceedings and that the conviction and sentence are legal; (3) a review of all the pleadings in the record and (4) a review of all the transcripts to determine if any ruling provides an arguable basis for appeal. We find two non-frivolous issues, one of which requires a reversal of the contempt adjudication and sentence. However, both are also reviewable under error patent. Thus, we will address those issues in the error patent discussion.
PRO SE ASSIGNMENT OF ERROR
Defendant filed a brief in response to the letter issued by this court. He asserts that the evidence was insufficient to convict him of second degree murder because the state failed to produce any direct evidence that defendant had the specific intent to kill the victim. He argues that, at best, the evidence supports a conviction of manslaughter. Defendant asserts that the state's witness, Robinson, testified that defendant removed the clip from his handgun and handed it to Bies. Bies checked it out and then handed it back to defendant. Defendant argues that there is no testimony that defendant put the clip back into the gun or that defendant knew the gun was loaded when he pulled the trigger. Although Robinson testified that defendant *263 and the witness did not argue before the shooting, Monica, Robinson's girlfriend, testified that he told her that there had been an argument. Defendant asserts that these facts show that he performed a rash act during an argument. Thus, he concludes that the state failed to prove the essential elements for second degree murder. Defendant requests a reversal and new trial or that the case be remanded for re-sentencing.
The constitutional standard for testing the sufficiency of the evidence, enunciated in Jackson v. Virginia, 443 U.S. 307, 319, 99 S.Ct. 2781, 2789, 61 L.Ed.2d 560, 573 (1979), requires that a conviction be based on proof sufficient for any rational trier of fact, viewing the evidence in the light most favorable to the prosecution, to find the essential elements of the crime beyond a reasonable doubt. State v. Thorne, 93-859 (La.App. 5th Cir. 2/23/94), 633 So.2d. 773, 776 State v. Styles, 96-897 (La.App. 5th Cir. 3/25/97), 692 So.2d 1222, 1232; State v. Ortiz, No. 96-KA-1609 (La.10/21/97), 701 So.2d 922, 930.
In order to prove guilt by circumstantial evidence, the state must exclude every reasonable hypothesis of innocence. La. R.S. 15:438. This is not separate from the Jackson standard. Ultimately, all evidence, both direct and circumstantial, must be sufficient under Jackson to satisfy a rational juror that the defendant is guilty beyond a reasonable doubt. State v. Ortiz, 701 So.2d at 930.
In order to prove second degree murder, the state must prove (1) the killing of a human being and (2) that defendant had the specific intent to kill or inflict great bodily harm. La. R.S. 14:30.1; State v. Thorne, 633 So.2d at 777.
Specific criminal intent is "that state of mind which exists when the circumstances indicate that the offender actively desired the prescribed criminal consequences to follow his act or failure to act." La. R.S. 14:10(1). It is a question of fact. State v. Seals, 95-0305 (La.11/25/96), 684 So.2d 368, 373. Specific intent may be Ted from circumstances and actions of defendant. Id. at 373; State v. Silva, 96-459 (La.App. 5th Cir. 11/26/96), 685 So.2d 1119, 1125. For the purposes of second degree murder, specific intent may be inferred from the pointing of a gun at close range and pulling the trigger. State v. Seals, 684 So.2d at 373; State v. Thorne, 633 So.2d at 777.
In this case, the eyewitness, Robinson, testified that the victim did not provoke defendant prior to the shooting. Although Robinson did not testify that he saw defendant reload the weapon after the victim returned it to him, the gun was never out of defendant's sight and there is no allegation that anyone else could have loaded the weapon without his knowledge. Defendant was one and one-half feet from the victim when he shot him. The bullet that killed the victim was proven to come from defendant's gun. In addition, as defendant and Robinson were leaving the apartment, defendant stopped, pointed his gun at Bies for the second time and said that he was going to have to shoot the victim again.
Viewing the evidence in the in the light most favorable to the prosecution, we find that the state proved the essential elements of the crime of second degree murder beyond a reasonable doubt.
ERROR PATENT REVIEW
La.C.Cr.P. art. 920 provides: "the following matters and no others shall be considered on appeal: (1) An error designated in the assignments of error; and (2) An error that is discoverable by a mere inspection of the pleadings and proceedings and without inspection of the evidence."
For the purpose of an error patent review the "record" in a criminal case includes the caption, the time and place of holding court, the indictment or information and the endorsement thereon, the arraignment, the plea of the accused, the bill of particulars filed in connection with a short form indictment or information, the mentioning of the impaneling of the jury, the minute entry reflecting sequestration in a capital case, the verdict, and the judgment or sentence. State v. Oliveaux, 312 So.2d 337 (La. 1975); State v. Boudreaux, 95-153 (La.App. 5th Cir. 9/20/95); 662 So.2d 22, 28.
First, we note that the record does not reflect whether or not the trial judge *264 ruled on the motion to suppress statements, which was based on the state's failure to notify defendant of any statements it intended to use at trail. However, the record reflects that the motion was moot because the state provided defendant with the information. Further, defendant proceeded to trial without objecting that the motion was outstanding. Thus, he waived all pending motions at the commencement of trial. State v. Price, 96-680 (La.App. 5th Cir. 2/25/97), 690 So.2d 191, 196.
Second, the contempt adjudication against defendant was not in compliance with La.C.Cr.P. art. 22, which states:
A person who has committed a direct contempt of court may be found guilty and punished therefor by the court without any trial, after affording him an opportunity to be heard orally by way of defense or mitigation. The court shall render an order reciting the facts constituting the contempt, adjudging the person guilty thereof, and specifying the punishment imposed.
Here, the trial judge found defendant in contempt without affording him an opportunity to be heard orally by way of defense or mitigation. In addition, the trial judge failed to render an order reciting the facts constituting the contempt and adjudging defendant guilty thereof. The trial judge did specify the punishment imposed. Accordingly, the judgment of contempt is reversed and the sentence is vacated.
Third, our review reveals that defendant was not advised of the three-year time limit for filing an application for post conviction relief, as required by La.C.Cr.P. art. 930.8. This article dictates that, except under certain limited circumstances, a defendant must file his application for post-conviction relief within three years after his judgment of conviction. Section C provides that the trial judge shall inform defendant of this prescriptive period at the time of sentencing. However, the failure to inform the defendant is not a ground for vacating the sentence. Rather, the remedy is to remand the case with an instruction to the trial judge to inform defendant of the provisions of article 930.8 by sending written notice to defendant within ten days after the rendition of this opinion and to file written proof in the record that defendant received such notice. State v. Birden, 675 So.2d at 1190-1191; State v. Crossley, 94-965 (La.App. 5th Cir. 3/15/95), 653 So.2d 631, 636-637, writ denied, 95-0959 (La.9/15/95), 660 So.2d 459.
Accordingly, defendant's conviction of second degree murder and sentence are hereby affirmed. The case is remanded for the trial judge to inform defendant of the provisions of article 930.8 by sending written notice to defendant within ten days after the rendition of this opinion and to file written proof in the record that defendant received such notice.
CONVICTION AND SENTENCE FOR SECOND DEGREE MURDER AFFIRMED; CONVICTION FOR CONTEMPT REVERSED AND SENTENCE VACATED; CASE REMANDED.
NOTES
[1] In his motion, defendant merely contested the use of any statements without prior notification by the state. The record shows that the state notified defendant of all statements it intended to use at trial and the motion is moot.
[2] A written order shows that it was denied on July 7, 1997.
[3] The testimony was unclear as to whether defendant removed the clip from only one gun or both of the guns he showed to Bies. Robinson said he removed the clip, but also said that Bies looked at two guns.
[4] Deputy Johnson testified during a motion hearing that they were there to execute an arrest warrant from Orleans Parish, where defendant was wanted for attempted murder. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1144327/ | 210 Kan. 820 (1972)
504 P.2d 580
STATE OF KANSAS, Appellee,
v.
JUNIOR D. KLIEWER d/b/a K & S MOTOR CO., Appellant.
No. 46,825
Supreme Court of Kansas.
Opinion filed December 9, 1972.
Ray Hodge, of Beaty, Hodge and Wood, of Wichita, argued the cause, and was on the brief for the appellant.
David P. Calvert, deputy county attorney, argued the cause, and Vern Miller, attorney general, and Keith Sanborn, county attorney, were with him on the brief for the appellee.
The opinion of the court was delivered by
SCHROEDER, J.:
This is an appeal from a conviction on two misdemeanor counts: (1) Turning back the odometer used for registering the mileage on a motor vehicle countrary to K.S.A. 1971 Supp. 8-611 (b), and (2) Committing a deceptive commercial practice contrary to K.S.A. 1971 Supp. 21-4403. The appellant was sentenced to be confined in the Sedgwick County jail for a term not to exceed six months and to pay a fine of $1,000 on each count, the sentences to run concurrently.
On appeal the appellant challenges the sufficiency of the evidence, the admission of exhibits and the legal propriety of charging him with the foregoing two counts because the second is duplicitous of the first.
On the 7th day of August, 1971, Junior D. Kliewer (defendant-appellant) hired and paid Sheila Van Orman to reset and turn back the odometer on a green 1969 Ford automobile. Mrs. Van Orman gave a receipt to Kliewer for the money paid and kept a copy. Her copy of the receipt was admitted into evidence. It indicated the date of August 7, 1971, disclosing the work was performed on a *822 1969 "Ford Galaxie 500" for K. & S. Motors, and that $6 was paid for the service. Mrs. Van Orman performed the aforementioned services on the property of K. & S. Motor Company, a company owned by Kliewer. On the 17th day of August, 1971, Kliewer sold the automobile to Mr. Gilbert Schrag. On December 16, 1971, a three count complaint was filed against Kliewer charging him with violations of: (1) K.S.A. 1971 Supp. 8-611 (b); (2) K.S.A. 1971 Supp. 8-611 (a); and (3) K.S.A. 1971 Supp. 21-4403.
The matter was tried to the court, upon waiver of a jury. At the trial Kliewer's motion requiring the state to elect between count two and count three was sustained, and the state dismissed count two.
The trial court heard testimony from four state's witnesses; Sheila Van Orman, the person who worked on the odometer of the 1969 Ford in question, R.K. Scholle, the original owner of the car, Gilbert Schrag, who purchased the car from Kliewer, and John Dickey, an investigator for the Sedgwick County Attorney's office. Over the appellant's objection the trial court admitted two state's exhibits into evidence: Exhibit No. 2 the application for certificate of title by R.K. Scholle giving the identification number and the description of the vehicle here in question; and Exhibit No. 3 the application for certificate of title by Gilbert and/or Vida Schrag describing the vehicle in question by identification number and description. This application disclosed the vehicle was acquired by the Schrags from "K.S. Motor Co.", 1620 North Broadway, Wichita, Kansas; and that it was accepted by the McPherson County Treasurer on the 19th day of August, 1971.
Assuming state's exhibits 2 and 3 were properly admitted by the trial court, the evidence identifies a 1969 Ford Galaxie 500 automobile, green in color, by identification number, and shows a complete chain of possession from the original purchaser, R.K. Scholle, through Kliewer to the Schrags. Scholle testified he purchased the vehicle new, was engaged in the business of a mail carrier, and when he sold the vehicle it registered over 99,000 miles on the odometer. Mrs. Van Orman testified she turned the odometer back on the vehicle in question for which she gave a receipt to Kliewer evidencing payment of $6 to her for the services. Gilbert Schrag testified concerning his knowledge of the vehicle, its purchase, and acknowledged his signature on state's exhibit No. 3, a copy of his application for title. John Dickey described the 1969 Ford in detail, having investigated it on the date of trial. He gave its *823 identification number and testified the odometer reading was 56,920.2 miles on the date of trial.
On the 25th day of February, 1972, the trial court found Kliewer guilty as charged on count one and on count three. Kliewer's motion for a new trial was subsequently overruled and he has duly perfected an appeal to this Court.
Count one of the information charges the appellant with unlawfully, willfully, disconnecting, turning back, and resetting the odometer on a 1969 Ford Galaxie 500 in violation of K.S.A. 1971 Supp. 8-611 (b). He was, therefore, charged as the principal in turning back the odometer. The evidence showed that he hired and procured Shiela Van Orman to actually perform the work. This is in accordance with K.S.A. 1971 Supp. 21-3205 which states in part:
"(1) A person is criminally responsible for a crime committed by another if he intentionally aids, abets, advises, hires, counsels or procures the other to commit the crime.
"(3) A person liable under this section may be charged with and convicted of the crime although the person alleged to have directly committed the act constituting the crime lacked criminal capacity or has not been convicted...."
The language of the statute clearly conveys the legislative intent enabling accessories, abettors, etc., to be charged and convicted of the crime as principals. In this case the appellant hired Mrs. Van Orman. The court's attention was first directed to 21-3205, supra, in State v. Edwards, 209 Kan. 681, 683, 498 P.2d 48, where it was discussed and applied. Under 21-3205, supra, it is unnecessary that the appellant be advised of its provisions before they are applied and given effect. The prior Kansas Statutory Law and the decisions construing it on the point asserted by the appellant that he was charged as a principal, whereas the evidence at the trial only tended to incriminate him as an accessory is consistent with the new code provision. The prior law was last reviewed by this Court in State v. Ogden, 210 Kan. 510, 502 P.2d 654.
Under 21-3205, supra, one who intentionally aids, abets, advises, hires, counsels or procures another to commit an offense may be charged, tried and convicted as though he were a principal.
The Judicial Council note to 21-3205, supra, states the rule was intended to supersede former K.S.A. 21-105, which related to principals in the second degree and accessories before the fact. This *824 section does not use the term "principal" but states the rule in terms of criminal liability. It makes no change in the substance of the prior law.
The appellant argues he came to trial to defend the charge that he turned back the odometer. He contends "other" was not mentioned in the information as required by K.S.A. 1971 Supp. 21-3110 (2), so that he could be tried as an accessory. The statute cited by the appellant is a general definition section of the New Criminal Code. Sub-paragraph (2) defines "another" to mean "a person or persons as defined in this code other than the person whose act is claimed to be criminal." This definition has no application to 21-3205, supra, which does not contain any requirement that the person criminally liable be charged as an accessory.
The appellant contends that the trial court erred in admitting state's exhibits No. 2 and No. 3 in evidence over his objection. First he asserts the exhibits were copies of applications for title and were not the originals. Second, he contends the exhibits were not under seal as required by K.S.A. 60-465; that he was never given copies of the exhibits before trial; and the state had listed as a state's witness on the information an officer of the Motor Vehicle Department of the State of Kansas, but failed to call him as a witness.
Under K.S.A. 60-460 (o) a writing purporting to be a copy of an official record, or of an entry therein, is admissible to prove the content of the record as an exception to the hearsay rule, if it meets the requirements of authentication under K.S.A. 60-465. The rule is subject to K.S.A. 60-461. Under 60-465, supra, a writing purporting to be a copy of an official record, or an entry therein, meets the requirements of authentication if the judge finds that the writing purports to be published by authority of the nation, state or subdivision thereof, in which the record is kept; or evidence has been introduced sufficient to warrant a finding that the writing is a correct copy of the record or entry.
The record discloses Mr. Scholle, who originally purchased the Ford automobile in question new, identified exhibit No. 2 as bearing his signature. He described it as the title to the car that he traded in. He testified exhibit No. 2 was a fair copy and an accurate reproduction of it.
Gilbert Schrag identified exhibit No. 3 as bearing a copy of his signature. He described the exhibit as a copy of the title transfer which he signed sometime in August, 1971. He also described it *825 as pertaining to the car that he purchased from Mr. Kliewer. He testified exhibit No. 3 was an accurate copy of what he signed.
The trial court, after hearing the foregoing testimony and the argument of counsel, admitted the exhibits in evidence as exceptions to the hearsay rule. Based upon the foregoing testimony and the statutory sections cited, the trial court did not err in admitting exhibits No. 2 and No. 3 in evidence over the appellant's objections for the reasons stated in such objections.
Since evidence was offered from which the trial court could find that the exhibits were correct copies of the originals, the exhibits were not required to be under seal.
Under K.S.A. 60-461 any writing admissible under exceptions (o), (p), and (q) of section 60-460, supra, shall be received only if the party offering such writing has delivered a copy of it or so much thereof as may relate to the controversy, to each adverse party a reasonable time before trial, unless the judge finds that such adverse party has not been unfairly surprised by the failure to deliver such copy.
Assuming, without deciding, that it was error for the trial court to admit exhibits No. 2 and No. 3 by reason of the failure of the state to deliver copies of such exhibits to the appellant's attorney a reasonable time before trial, the appellant interposed no objection to the exhibits on this ground at the trial.
K.S.A. 60-404 states:
"A verdict or finding shall not be set aside, nor shall the judgment or decision based thereon be reversed, by reason of the erroneous admission of evidence unless there appears of record objections to the evidence timely interposed and so stated as to make clear the specific ground of objection."
Under the foregoing statute the judgment or decision of the trial court based upon findings attributable to exhibits No. 2 and 3 cannot be reversed. (See, State v. Jolly, 196 Kan. 56, 410 P.2d 267.)
A careful review of the record indicates there was sufficient evidence upon which the trial court could find the appellant guilty on each of the counts for which he stood trial. This court does not weigh evidence and is not concerned with inferences therefrom opposed to the findings. In a criminal action the function of this court on appeal is not to decide whether guilt was shown by the evidence beyond a reasonable doubt, but to ascertain whether there was, in the evidence, a basis for a reasonable inference of guilt. *826 (State v. Phippen, 207 Kan. 224, 231, 485 P.2d 336; State v. Satterfield, 202 Kan. 395, 397, 449 P.2d 566, and cases cited therein.)
The appellant contends the intent of the legislature was to exclude automobiles from the operation of K.S.A. 1971 Supp. 21-4403 because the subject of automobiles was specifically dealt with in K.S.A. 1971 Supp. 8-611. It is argued the specific statute takes precedence over the general and the state elected to stand on the general when it dismissed count two of the information.
This point has merit.
Article 44 of our new Kansas Criminal Code (effective July 1, 1970) pertains to "CRIMES AGAINST BUSINESS". In the code 21-4403, supra, defines a deceptive commercial practice as:
"(1) A deceptive commercial practice is the act, use or employment by any person of any deception, fraud, false pretense, false promise, or knowing misrepresentation of a material fact, with the intent that others shall rely thereon in connection with the sale of any merchandise, whether or not any person has in fact been misled, deceived or damaged thereby."
Under Chapter 8, "AUTOMOBILES AND OTHER MOTOR VEHICLES" Article 6 pertains to "FAIR TRADE". In K.S.A. 1971 Supp. 8-611 (effective July 1, 1969) the legislature addressed attention to unlawful acts pertaining to odometers, tachometers and other devices registering mileage on vehicles. This statute provides in part:
"(b) It shall be unlawful for any person to disconnect, turn back, reset or replace the odometer, tachometer or any other device used for registering the mileage or use of motor vehicles with the intent to reduce the number of miles or use thereof indicated on such gauge or device...."
Without engaging in extended discussion, it appears to us the legislature was addressing its attention to virtually the same subject matter in each of these statutes. One is "FAIR TRADE" the other "CRIMES AGAINST BUSINESS", and more particularly a deceptive commercial practice. The one (8-611, supra) is specific and the other (21-4403, supra) is general in its application, embracing a far greater range of activity pertaining to deception, fraud and misrepresentation of material fact.
These statutes are not repugnant to each other and may be reconciled. Harmony is made possible by the fact that 8-611, supra, deals specifically with the deceptive practice for which the appellant is charged, and 21-4403, supra, deals generally with the same deceptive practice. Under these circumstances, where there is a conflict between a statute dealing generally with a subject and another statute dealing specifically with a certain phase of it, the *827 specific statute will be favored over the general statute and controls. (State v. Christensen, 166 Kan. 152, 157, 199 P.2d 475; Moody v. Edmondson, 176 Kan. 116, 120, 269 P.2d 462; Ferrellgas Corporation v. Phoenix Ins. Co., 187 Kan. 530, 535, 358 P.2d 786; and Barten v. Turkey Creek Watershed Joint District No. 32, 200 Kan. 489, 506, 438 P.2d 732.)
In Ferrellgas Corporation v. Phoenix Ins. Co., supra, the court said:
"... In our view, the cases cited by the court found that not only was the same field covered by the two statutes, but the provisions of the newer act were absolutely repugnant to the provisions of the older act. Where that is true, the older act must be held to be repealed. But as explained above, the two acts involved in this case are not actually repugnant to each other but each may be effective. In view of the fact that repeals by implication are never favored, and further because of the rule that a specific statute will be favored over a general statute, Dreyer v. Siler, 180 Kan. 765, 308 P.2d 127; Ehrsam v. Borgen, 185 Kan. 776, 347 P.2d 260, we are constrained to disagree with the learned judge." (p. 535.)
On the facts in this case the appellant was charged and convicted on two counts for the same wrongdoing which constituted but one offense. Accordingly, the conviction and sentence on count three, charging the appellant with the violation of K.S.A. 21-4403, must be vacated and set aside.
The judgment and sentence of the lower court is affirmed on count one and is reversed on count three.
KAUL, J., dissenting in part:
I cannot agree with the majority's holding that defendant's conviction on count three must be vacated and set aside.
In count one defendant was charged with turning back and resetting the odometer register of an automobile speedometer in violation of K.S.A. 1971 Supp. 8-611. After this offense was completed, defendant then proceeded to employ deception and fraud in knowingly misrepresenting to actual and potential purchasers the mileage registered by the odometer as being actual mileage in violation of the deceptive commercial practices proscribed by K.S.A. 1971 Supp. 21-4403. The two offenses and the elements thereof are separate and distinct and do not stem from the same single act of wrongdoing. It so happens that in this case the same person was convicted of violations of both acts, but there was substantial evidence to sustain the conviction in each instance. I would affirm the judgment in toto. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2264079/ | 479 F.Supp. 945 (1979)
Tommy SHAW, Plaintiff,
v.
LIBRARY OF CONGRESS et al., Defendants.
Civ. A. No. 79-0325.
United States District Court, District of Columbia.
September 14, 1979.
Sara Ann Determan, David C. Kohler, Hogan & Hartson, Washington, D. C., for plaintiff.
Robert M. Werdig, Jr., Asst. U. S. Atty., Washington, D. C., for defendants.
MEMORANDUM
OBERDORFER, District Judge.
I
Plaintiff is a black employee of the Library of Congress ("The Library"). In 1976 *946 and 1977 he formally complained to Library officials that the Library had failed to promote him from GS-13 to GS-14 because, among other reasons, it had failed to validate and correct its allegedly discriminatory job selection criteria and procedures. On August 16, 1978, Library officials executed a settlement agreement with plaintiff which recited that the Library was "uncertain whether its failure to use validated procedures in its selection process involved in those positions for which the [plaintiff] applied constitutes an unjustified, unwarranted or discriminatory personnel practice for which restitution is provided by law."[1] Plaintiff's Exhibit 1, filed February 1, 1979, at 1. In settlement the Library agreed "to continue its good faith effort to validate its employee selection procedures to the extent required by law as expeditiously as possible within its available resources and personnel," and to assign plaintiff to a "new position with the primary responsibility of implementing the Library's validation program." Id. at ¶¶ I.A., B. The Library further agreed to assign at least two competent professional staff members to assist plaintiff in his new work. In specific consideration for plaintiff's withdrawal of his administrative complaint and for undertaking his new responsibilities, the Library agreed to promote plaintiff to GS-14 and to make the promotion retroactive to January 18, 1977 with back pay and with grade increases
provided the Comptroller General determines that the Library may grant such retroactive promotion and backpay under the facts of this case.
Id. at ¶ II.C. The question to be put to the Comptroller General was whether, in settling a discrimination complaint such as plaintiff had made, the Library has legal authority to make a retroactive promotion with back pay without first making a formal determination that there was in fact discrimination.[2] The agreement did not articulate the various sources of statutory authority about which the Library sought the Comptroller's advice.
When on August 16, 1978 the Library inquired of the Comptroller General, however, it effectively limited the inquiry to advice as to the Library's authority under the Back Pay Act, 5 U.S.C. § 5596 (1976). The August 16 letter conspicuously failed to ask the Comptroller General's advice about the Library's authority under Title VII to award back pay and promote retroactively in the absence of a finding of discrimination, and the Comptroller treated the inquiry as so limited.[3] Thus, on November 2, 1978, the General Counsel of the General Accounting Office responded to the Associate Librarian of Congress, stating the opinion that:
The Back Pay Act requires a finding by an appropriate authority that an unjustified or unwarranted personnel action has *947 occurred and that "but for" that action, the employee would have been promoted.
Plaintiff's Exhibit 2, filed February 1, 1979. The General Counsel's November 2 letter declined to advise about the Library's authority under Title VII, noting that since 42 U.S.C. § 2000e-16(b) (1976) gives
the Librarian of Congress separate authority to enforce Title VII of the Civil Rights Act with respect to employees of the Library, we do not express our opinion as to whether such a remedy would be authorized in this case under Title VII.
Id.
Thereafter when plaintiff attempted through counsel to discuss the Library's authority under Title VII referred to in the General Counsel's letter, he was finally rebuffed by a January 4, 1979 letter from the Associate Librarian of Congress. This suit followed.
II
The matter is now before the Court on cross-motions for summary judgment. Those motions and the supporting memoranda frame the narrow questions left unanswered by the GAO General Counsel: whether the Library, in settling employment discrimination complaints, is authorized by Title VII to award retroactive promotion with back pay without formally finding itself guilty of discrimination; and, if so, whether it may, consistently with the statute, adopt regulations that preclude it from exercising that authority, that is, that preclude it even from considering an award of back pay in the settlement negotiation process.
The cross-motions are ripe for decision. The Library does not seriously advance the August 16, 1978 settlement agreement as a bar to the action.[4] Suffice it to say therefore that the correspondence between the Library, the GAO General Counsel and the plaintiff's counsel reveal mistaken legal and factual assumptions underlying the settlement agreement which neutralize its possible effect as a bar.[5] The Library was operating as if its authority were circumscribed by the Back Pay Act and by the Library's regulations issued pursuant to Title VII. Since, as will be developed, that assumption is erroneous, the agreement based on it is without force and effect as a bar to plaintiff's invocation of whatever power the Library has under Title VII to award retroactive promotion and back pay.
Furthermore, the settlement agreement does not eliminate the case or controversy here because the Library did not perform the agreement. The settlement agreement contemplated a GAO ruling on the Library's authority to award back pay and promote retroactively, regardless of its statutory source. The plaintiff was obviously interested in the Library's authority, not some technical advice about the precise basis for it. The Library inquired of the Comptroller General about the Library's authority under the Back Pay Act, but not its authority under Title VII.[6] Thus, any waiver of legal rights that plaintiff agreed to in consideration of the Library's promises, see Plaintiff's Exhibit 1, at ¶ IIIC, was vitiated by the Library's failure to carry them out.
III
For reasons to be stated, the Court concludes on the merits that Title VII creates in the Library legal authority to award retroactive promotion with back pay *948 to an employee who in good faith claims that he has suffered discrimination in employment, without formally deciding the merits of the discrimination charge.[7] As a corollary the employee has a right to require the Library to recognize and exercise this conciliation and settlement authority with which Congress endowed it in Title VII.[8]
In 1975, Congress made Title VII applicable to the Library, having made that Title applicable to the Executive Branch departments and independent agencies in 1972. The 1975 Act gave the Library all the responsibility and authority with respect to employment discrimination previously imposed and conferred upon other government agencies in 1972, responsibility and authority closely paralleling that exercised by private employers since 1964. The plain language of Title VII authorized retroactive award of back pay to correct discrimination. 42 U.S.C. § 2000e-16(b). Moreover, from the beginning of federal employment discrimination enforcement, conciliation has been a first principle, and flexibility of methods a key. This is evident from the legislative history. For example, the House Report accompanying the Civil Rights Act, in a passage quoted and relied upon by the Supreme Court in the recent case of United Steelworkers v. Weber, ___ U.S. ___, 99 S.Ct. 2721, 61 L.Ed.2d 480 (1979) stated:
No bill can or should lay claim to eliminating all of the causes and consequences of racial and other types of discrimination against minorities. There is reason to believe, however, that national leadership provided by the enactment of Federal legislation dealing with the most troublesome problems will create an atmosphere conducive to voluntary or local resolution of other forms of discrimination.
H.R.Rep.No.914, 88th Cong., 1st Sess. (1963), at 18, quoted in United Steelworkers v. Weber, supra, 99 S.Ct. at 2728 (emphasis supplied by the Weber Court).
The public policy favoring amicable settlement of all disputes to reduce tension between the parties and to reduce the workload of courts operates with maximum force and effect in the context of employment discrimination. See, e. g., United States v. Allegheny-Ludlum Industries, Inc., 517 F.2d 826, 849-50 (5th Cir., 1975). The Library is before the Court in this case as an employer rather than as an administrative agency or a mini-EEOC. If the Library had been a private employer, it could not seriously have claimed to lack power to award back pay and retroactive promotion to an employee threatening to sue on account of employment discrimination unless and until the employer had found that it had discriminated. See, e. g., United Steelworkers v. Weber, supra. Similarly, if a dispute, such as the one underlying this case, had come to court and been settled without any admission or adjudication of discrimination, there could be no doubt about a court's power to enforce the settlement. See, e. g., United States v. Allegheny-Ludlum Industries, supra. The Library concedes its authority to award such relief if it should make a formal determination of discrimination. The authorities are legion that Congress and the courts intended employers, private and public (including the Library), to have and to exercise broad authority to remedy employment discrimination. See, e. g., United Steelworkers v. Weber, supra; Alexander v. Gardner-Denver Co., 415 U.S. 36, 44, 94 S.Ct. 1011, 39 L.Ed.2d 147 (1974); 42 U.S.C. § 2000e-16(b); S.Rep.No.415, 92nd Cong., 1st Sess. 15 (1971). Devices to achieve *949 these objectives are freely available in court, at the administrative level and as management techniques of employers.
The Library can no more unilaterally incapacitate its Congressionally-created power to settle employment discrimination disputes by awarding retroactive promotions with back pay than it could refuse to use funds appropriated by Congress for a stated purpose. See Local 2677 v. Phillips, 358 F.Supp. 60, 75-79 (D.D.C.1973) (claim of discretion under Constitution rejected); cf. Train v. City of New York, 420 U.S. 35, 95 S.Ct. 839, 43 L.Ed.2d 1 (1975) (claim of discretion under statute rejected). Since the purported infirmity in the Library's authority is self-inflictedby unilateral regulationthe Library could unilaterally restore it by simply adopting a regulation declaring its power restored. This formality is unnecessary here. The plaintiff has pressed a bona fide claim of employment discrimination. The Library has the power (but not the duty) under Title VII to dispose of that claim by promoting plaintiff retroactively and with back pay without any formal determination that it discriminated against him.
IV
The Library's reliance on the particular regulations at issue here as a defense is particularly misplaced. The regulation invoked by the Library states:
Where it has been determined that an employee of the Library was discriminated against, and as a result of that discrimination was denied a benefit, the Library shall take remedial actions . .
L.C.R. 2010-3.1 § 13.A.[9]
It is obvious that this regulation does not, by its terms, purport to preclude any retroactive promotion or back pay award in the absence of a finding of discrimination.[10] In light of the historic policy favoring the amicable settlement of disputes and the particular settlement policy of Title VII, no regulation should be interpreted as intending to limit the bargaining options available to an agency confronted by a bona fide discrimination complaint unless the language of the regulation is specific and unambiguous. That is certainly not the case of the regulation here invoked by the Library. Moreover, even if the regulation provided what the Library claims for it, its validity would be extremely questionable, particularly in the absence of any evidence that its use had been ratified by Congress for the purposes here invoked. On both grounds, therefore, the regulation does not effectively incapacitate the Library from awarding the relief plaintiff claims.
ORDER AND JUDGMENT
Upon consideration of the parties' motions for summary judgment, the memoranda of points and authorities submitted by the parties, the arguments of counsel for the parties, and the record herein, and for the reasons stated in the accompanying Memorandum, it is by this Court this 14th day of September, 1979, hereby
ORDERED: That plaintiff's motion for summary judgment is GRANTED; and it is
FURTHER ORDERED: That JUDGMENT is entered for PLAINTIFF; and it is
FURTHER ORDERED: That defendants' motion for summary judgment is DENIED; and it is
FURTHER ORDERED, ADJUDGED AND DECLARED: That defendants are authorized (but not required) to award a retroactive promotion with back pay without a formal finding of discrimination to an employee who has made a bona fide complaint *950 of employment discrimination, and that any regulation purporting to deny that authority is to that extent invalid; and it is
FURTHER ORDERED: That plaintiff shall be awarded reasonable attorneys' fees and other litigation costs reasonably incurred pursuant to 42 U.S.C. § 2000e-5(k), the precise amount of such fees and costs to be determined after further proceedings and a decision by our Court of Appeals en banc in Copeland v. Marshall.
NOTES
[1] An August 16 letter from the Library to the Comptroller General written pursuant to the settlement agreement stated that:
For several years, the Library has been committed to the validation of all its position qualifications and the process used to fill vacancies. Some have been completed, but a majority of position qualifications and selection processes remain to be validated.
Government Exhibit G, filed July 16, 1979, at 1.
[2] The agreement stated specifically:
the Library agrees . . . to refer to the Comptroller General the question whether the Library may, in resolving Employee's complaints, provide that Employee's promotion to GS-14 be made retroactive to January 18, 1977, with appropriate backpay, without a specific finding by the Library of racial discrimination or an unwarranted or unjustified personnel action . . ..
Plaintiff's Exhibit 1, filed February 1, 1979, at 4; Statement of Material Facts As To Which Defendants Contend There Is No Genuine Issue, filed July 16, 1979, at ¶ 11.
[3] The August 16 letter stated:
The Library is not certain . . . of the Comptroller General's position on one perspective [sic] of this settlement which the employee feels may provide the basis for a retroactive promotion and back pay under the provisions of the Back Pay Act of 1966 (5 U.S.C. § 5596) rather than the provisions of 42 U.S.C. 2000e-5(g) and regulations thereunder. This is the question of whether the Library's failure to validate the positions in question constituted an unjustified and unwarranted personnel action or such administrative error as to evoke application of the Back Pay Act.
Government Exhibit G, filed July 16, 1979, at 2.
[4] In fact, defendant concedes that the Court has not been divested of jurisdiction by the settlement. See, e. g., Response of Defendants to Post Hearing Memorandum of Points and Authorities In Support of Motion of Plaintiff For Summary Judgment And In Opposition To Motion of Defendants For Summary Judgment, filed September 7, 1979, at 1. The Court, however, proceeds to consider the issue sua sponte.
[5] The Court may, of course, consider issues raised by the contract: it always has jurisdiction to determine whether it has jurisdiction, even when the jurisdictional question is inextricably intertwined with questions on the merits. See Nestor v. Hershey, 138 U.S.App.D.C. 73, 80, 425 F.2d 504, 511 (D.C. Cir. 1969).
[6] In fact, the Comptroller General's response permits the inference that the Comptroller General would, if asked, advise the Library that it enjoyed the authority which it sought to disavow.
[7] The Comptroller General's opinion is not to the contrary.
[8] The Court emphasizes that the plaintiff is not here seeking to require the Library to exercise its discretion to award back pay in a particular way in this case; rather, plaintiff seeks here to require the Library merely to consider an award of back pay as an option available to it in the settlement negotiation process. See East Oakland-Fruitvale Planning Counsel v. Rumsfeld, 471 F.2d 524, 529, 534 (9th Cir. 1972) (requiring the Office of Economic Opportunity to consider whether to override the state executive's veto of a particular project's funding, even though the ultimate OEO decision would be beyond review); cf. Committee for Full Employment v. Blumenthal, 196 U.S.App.D.C. 155, 606 F.2d 1062 (D.C. Cir. 1979).
[9] The Court notes that the so-called "regulation" that the Library invokes is apparently not one codified in the Code of Federal Regulations. Cf. 36 C.F.R., Parts 701-703 (1978).
[10] A second regulation, L.C.R. 2010-3.1 § 11.C., is less than perfectly clear, but, if anything, seems to indicate that the Library's regulations do contemplate the possibility of remedial or other action in the absence of a formal finding of discrimination. Moreover, many of the Library's regulations stress the importance of informal complaint resolution. See, e. g., L.C.R. 2010-3.1 § 3.E. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1834241/ | 394 B.R. 402 (2008)
In re Angela Yvette LEE, Debtor.
No. 08-15455-RGM.
United States Bankruptcy Court, E.D. Virginia, Alexandria Division.
September 12, 2008.
Q. Russell Hatchl, Legal Services of Northern Virginia, Inc., Falls Church, VA, for Debtor.
MEMORANDUM OPINION
ROBERT G. MAYER, Bankruptcy Judge.
THIS CASE is before the court on the debtor's application for a waiver of the filing fee under 28 U.S.C. § 1930(f)(1). The statute provides:
Under the procedures prescribed by the Judicial Conference of the United States, the district court or the bankruptcy court may waive the filing fee in a case under chapter 7 of title 11 for an individual if the court determines that such individual has income less than 150 percent of the income official poverty line (as defined by the Office of Management and Budget, and revised annually in accordance with section 673(2) of the Omnibus Budget Reconciliation Act of 1981) applicable to a family of the size involved and is unable to pay that fee in installments. For purposes of this paragraph, the term "filing fee" means the *403 filing fee required by subsection (a), or any other fee prescribed by the Judicial Conference under subsections (b) and (c) that is payable to the clerk upon the commencement of a case under chapter 7.
The Judicial Conference of the United States promulgated Interim Procedures Regarding chapter 7 fee waivers on August 11, 2005. Paragraph II(A)(1) of the Interim Procedure states:
The district court or the bankruptcy court may waive the chapter 7 filing fee for an individual debtor who: (a) has income less than 150 percent of the poverty guidelines last published by the United States Department of Health and Human Services (DHHS) applicable to a family of the size involved; and (b) is unable to pay that fee in installments.
Footnote 2 explains that:
The statute provides, in part, that the court may waive the filing fee "if the court determines that such individual has income less than 150 percent of the income official poverty line (as defined by the Office of Management and Budget and revised annually in accordance with section 673(2) of the Omnibus Budget Reconciliation Act of 1981) applicable to a family of the size involved ..." These procedures interpret this statutory language to refer to the poverty guidelines updated periodically in the Federal Register by the U.S. Department of Health and Human Services under the authority of 42 U.S.C. § 9902(2). The phrase "income official poverty line as defined by the Office of Management and Budget" refers to the poverty thresholds set by the Census Bureau. OMB has never issued poverty thresholds or guidelines, but in August 1969, the Bureau of the Budget (the predecessor of OMB) did issue a document designating the Census Bureau poverty thresholds as the federal government's official statistical definition of poverty. Section 673(2) of the Omnibus Budget Reconciliation Act of 1981 (codified in 42 U.S.C. § 9902(2)) requires the Secretary of Health and Human Services to update the poverty guidelines annually. The thresholds are mentioned in that legislative section because they are the starting point from which the poverty guidelines are calculated. The Bureau of Census poverty thresholds are typically used for statistical purposes whereas the DHHS poverty guidelines are used administratively to determine program eligibility.
Judicial Conference Interim Procedure, Paragraph II(A)(1), n. 2.[1]
Applying the Interim Procedure, the court looks to the debtor's reported monthly gross income, which in this case is $2,601.00, and the family size as defined in the Interim Procedure.[2] In this case there are two, the debtor and one dependent. The applicable threshold is $1,750 a month. This is taken from the table prepared by the Administrative Office of the United States Courts. The current copy is appended to this opinion. In this case, the debtor's income exceeds 150% of the official poverty line and the court may not waive the filing fee.
While the court is sympathetic to the debtor's dire circumstances, the requirements for waiving the filing fee are mandatory. The debtor's income must be *404 less than 150% of the official poverty line. In this case is it not and the court may not waive the filing fee. The court will deny the debtor's request for a waiver of the filing fee but permit it to be paid in installments.
---------------------------------------------------------------
150% of the HHS Poverty Guidelines for 2008[*]
Monthly Basis
---------------------------------------------------------------
Persons in 48 Contiguous
family unit States and D.C. Alaska Hawaii
---------------------------------------------------------------
1 $1,300.00 $1,625.00 $1,495.00
2 $1,750.00 $2,187.50 $2,012.50
3 $2,200.00 $2,750.00 $2,530.00
4 $2,650.00 $3,312.50 $3,047.50
5 $3,100.00 $3,875.00 $3,565.00
6 $3,550.00 $4,437.50 $4,082.50
7 $4,000.00 $5,000.00 $4,600.00
8 $4,450.00 $5,562.50 $5,117.50
---------------------------------------------------------------
For each
additional
person add $ 450.00 $ 562.50 $ 517.50
---------------------------------------------------------------
===============================================================
150% of the HHS Poverty Guidelines for 2008[*]
Annual Basis
---------------------------------------------------------------
Persons in 48 Contiguous
family unit States and D.C. Alaska Hawaii
---------------------------------------------------------------
1 $15,600 $19,500 $17,940
2 $21,000 $26,250 $24,150
3 $26,400 $33,000 $30,360
4 $31,800 $39,750 $36,570
5 $37,200 $46,500 $42,780
6 $42,600 $53,250 $48,990
7 $48,000 $60,000 $55,200
8 $53,400 $66,750 $61,410
---------------------------------------------------------------
For each
additional
person add $ 5,400 $ 6,750 $ 6,210
---------------------------------------------------------------
NOTES
[1] The entire Interim Procedure is at http:// www.uscourts.gov/bankruptcycourts/jcus guidelines.html.
[2] Paragraph II(A)(4) of the Interim Procedure defines family size "as the debtor(s), the debtor's spouse (unless the spouses are separated and a joint petition is not being filed), and any dependents listed on Schedule I."
[*] As required by section 673(2) of the Omnibus Budget Reconciliation Act of 1981 (Pub.L. 97-35 reauthorized by Pub.L. 105-285, Section 201 (1988)).
[*] As required by section 673(2) of the Omnibus Budget Reconciliation Act of 1981 (Pub.L. 97-35 reauthorized by Pub.L. 105-285, Section 201 (1988)). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3354448/ | The court will treat the plaintiff's "motion to open judgment" as a petition for a new trial on the ground of newly-discovered evidence. Civitello vs. Connecticut SavingsBank 128 Conn. 621, 626.
During the course of the trial the plaintiff offered evidence that the defendant was celebrating the birth of a grandchild by offering his fellow employees drinks from a bottle of whiskey, and that the defendant had himself consumed some of the whiskey. The court attempted to exclude this testimony because it was immaterial and because no claim was made by the plaintiff that the defendant was under the influence of liquor or that his condition resulting from the consumption of liquor was, in any way, connected with the claimed assault. Regardless of the court's ruling, the plaintiff persisted in pursuing this question on several occasions. The defendant and another witness testified there was no liquor on the premises on that day, and that he had passed no bottle to fellow employees nor consumed any liquor himself.
The presence or absence of liquor in no way affected the court's deliberations. It had nothing whatever to do with the altercation between the parties on that day and was not a contributing factor to the excitement which resulted in this action. The reasons controlling the decision are stated in the court's memorandum.
The plaintiff now seeks a new trial because he has found two witnesses who will corroborate the plaintiff's testimony that the defendant passed a bottle of whiskey around and drank some himself. These witnesses have signed affidavits to that effect which the court has received in lieu of their verbal testimony. It appears that the same witnesses were employed at the factory at the time of trial and could have been available for testimony. They were not called because of lack of diligence in preparing for trial. All that the plaintiff or his counsel had to do before trial was to make the same kind of investigation that they made after the trial. These witnesses were there all the time and could have been discovered by the use of due diligence. Furthermore, as already indicated, their presence and testimony at the trial would not have changed the result, and their testimony at a new trial would be merely cumulative and have no effect on the decision. If this evidence were now allowed, it would open the door to the defendant to bring in an *Page 229
equal number of witnesses who would contradict the proposed witnesses, and thus, ad infinitum, the case would never end.
When ground for a motion for a new trial is newly-discovered evidence, the evidence must not have been discoverable before the trial by the use of due diligence. It must not be merely cumulative, and it must appear that the new evidence would probably be sufficient to change the result. McGrathvs. Crane Co., 119 Conn. 170; Luth vs. Butwill, 119 Conn. 697. By cumulative evidence is meant additional evidence of the same general character, to the same fact or point which was the subject of proof at the original trial. Levine vs. Union New Haven Trust Co., 127 Conn. 435, 440.
To entitle a party to a new trial for newly-discovered evidence, it is indispensable that he should have been diligent in his efforts fully to prepare his case for trial; and if the new evidence relied upon could have been known with reasonable diligence, a new trial will not be granted. Meriden vs. Rogers,111 Conn. 115.
A petition for a new trial based on negligence of the party or his attorney in the preparation or trial of the case cannot be allowed. Equity will not relieve against the operation of a judgment rendered through negligence or inattention of a party or his attorney. The fact that either was negligent is not sufficient ground for escaping the application of this rule. Palverarivs. Finta, 129 Conn. 38.
Where claimed new evidence is that of witnesses who will testify contrary to that of witnesses who testified at the original trial, it cannot be held as a matter of right that it is sufficient for granting a new trial. Civitello vs. Connecticut SavingsBank, 128 Conn, 621, 627.
Newly-discovered evidence which is merely cumulative will not suffice ordinarily to grant a new trial, and never unless it appears reasonably certain that injustice has been done in the judgment rendered and that the result of a new trial will probably be different. Levine vs. Union New Haven Trust Co.,127 Conn. 435, 439.
An application for a new trial on the ground of newly-discovered evidence is addressed to the discretion of the trial court (Gannon vs. State, 75 Conn. 576; Gonirenki vs. AmericanSteel Wire Co., 106 id. 1), and upon such an application the court compares the old testimony with the new and *Page 230
decides, in the exercise of sound discretion, whether injustice has probably been done, and whether the newly-discovered evidence is likely to change the result. Kliarsky vs. EasternGreyhound Lines, 116 Conn. 649. The essential issue in this case was not whether the defendant or anyone else, had consumed liquor on the day in question, but whether the defendant had committed an assault and battery on the plaintiff as alleged in the complaint.
The granting of new trials for newly-discovered evidence will be allowed only where it is clear that the case does not run counter to our established rules. One of these is that the new evidence must be sufficient to turn the cause in favor of the applicant, and another is that the new evidence must not be merely cumulative. The third rule, which applies here with equal force, is that newly-discovered evidence tending to impeach the general reputation of a witness, as the plaintiff is attempting to do in this case, will not furnish a basis for granting a new trial. Apter vs. Jordan, 94 Conn. 139.
The plaintiff's motion and supporting evidence lack every prerequisite for the granting of a new trial. The proposed evidence is immaterial, cumulative, of an impeaching character and discoverable before trial. The court has searched in vain for judicial sanction for the requested action and to grant it would be an abuse of sound discretion which would not be countenanced by our Supreme Court.
The plaintiff's motion to open the judgment is denied. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3354449/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]
MEMORANDUM OF DECISION (MOTION TO STRIKE, NO. 143)
Defendant moves to strike the second count of the complaint contending Connecticut does not permit recovery for bystander emotional distress caused by the negligent infliction of injury upon another.
The following facts are alleged in the plaintiffs' revised complaint. The plaintiffs are two married couples, James and Mary Joyce Trapp, and Brian and Susan Mandio, who were boating in Long Island Sound aboard a pleasure yacht on July 6, 1989. After the CT Page 4628 yacht was refueled and restarted, "the boat exploded, caught fire and burned to the water line, resulting in destruction of the craft." In count one, three plaintiffs are suing the defendant, West Haven Co-op Marina, which moored and maintained the yacht, for their burns and injuries. They allege that the marina and its employees improperly maintained the yacht and negligently allowed the plaintiffs to sail in an unseaworthy vessel.
In count two, the plaintiff Brian Mandio is suing the marina for mental and emotional distress caused by witnessing his wife being burned and injured in the explosion. He alleges that he has suffered "mental anguish, loss of sleep, nervousness, depression, as well as other physical and mental discomforts." In count three, Brian Mandio is suing for loss of consortium.
The defendant argues in support of striking count two that Connecticut does not allow a bystander to recover for emotional harm sustained when someone else is injured by the defendant's alleged negligence. In the alternative, the defendant argues that if Connecticut does recognize such a cause of action, the plaintiffs have not sufficiently alleged its elements.
The Connecticut Supreme Court has definitively ruled that no bystander emotional distress claim is available in a medical malpractice context. Maloney v. Conroy, 208 Conn. 392, 402
(1988). In an earlier medical malpractice bystander emotional distress case, the court neither rejected nor recognized bystander emotional distress as a theory of recovery, holding that even if a cause of action for bystander emotional distress exists, the facts of the case before it did not satisfy the elements. See Amodio v. Cunningham, 182 Conn. 80, 92 (1980). The law prior to Amodio was more clear: "there can be no recovery for nervous shock and mental anguish caused by the sight of injury or threatened harm to another." Strazza v. McKittrick, 146 Conn. 714, 719 (1959).
Connecticut's lower courts disagree whether bystander emotional distress damages are available in Connecticut in negligence suits not alleging medical malpractice. Since Maloney, the following courts have allowed a bystander emotional distress claim to proceed, assuming its elements have been sufficiently alleged. See Kearney v. Philips Industries, Inc., 708 F. Sup. 479,483 (D.Conn. 1989) (majority of Connecticut courts faced with issue recognize cause of action after Maloney; earlier decision dismissing count is vacated); LeMoine v. Soboleski, 2 CTLR 450 (October 4, 1990, O'Keefe, J.); Buynovsky v. Ford Motor Co., 1 CTLR 207 (May 21, 1990, Maiocco, J.); Uricchio v. Myjack,4 CSCR 385 (April 17, 1989, Stengel, J.); Higley v. Regional Educational Services Concept thru Unified Effort (RESCUE),4 CSCR 315 (March 10, 1989, West, J.); Glendening v. Weis 41 Conn. Sup. 165
(October 4, 1988, Hammer, J.); McCarthy v. Roberts, 3 CSCR 930
CT Page 4629 (November 3, 1988, Quinn, J.); McCarthy v. Widdows, 3 CSCR 741
(August 8, 1988, DeMayo, J.).
Some courts have refused to recognize a bystander emotional distress claim post Maloney. See Seymour v. Patterson, 2 CTLR 561 (November 8, 1990, Freed, J.); Brown v. Cohen, Foster, 5 CSCR 376
(May 7, 1990, Flanagan, J.); Tuten v. Bishop's Garage, Inc.,4 CSCR 520 (June 1, 1989, Koletsky, J.).
The California Supreme Court modified the test set forth in Dillon v. Legg, 441 P.2d 912 because "[l]ittle consideration has been given in post Dillon decisions to the importance of avoiding the limitless exposure to liability that the pure foreseeability test of `duty' would create and forward which these decisions have moved." Id. at 821. "[I]t is appropriate to restrict recovery to those persons who will suffer an emotional impact beyond the impact that can be anticipated whenever one learns that a relative is injured or dies or the emotion felt by a `disinterested' witness." Id. at 829. The elements of a bystander emotional distress claim are as follows:
[A] plaintiff may recover damages for emotional distress caused by observing the negligently inflicted injury of a third person if, but only if, said plaintiff: (1) is closely related to the injury victim; (2) is present at the scene of the injury producing event at the time it occurs and is then aware that it is causing injury to the victim; and (3) as a result suffers serious emotional distress a reaction beyond that which would be anticipated in a disinterested witness and which is not an abnormal response to the circumstances.
Id. at 829 -30. See LeMoine, 2 CTLR at 451 (applying Thing)
The plaintiff Brian Mandio alleges in his revised complaint that he is the husband of the plaintiff Susan Mandio. He also alleges that he witnessed his wife being burned in the yacht explosion, which he alleges was caused by the negligence of the defendant. He further alleges that he suffered mental and emotional distress as a result of witnessing the accident. Brian Mandio has alleged sufficient facts to state a claim upon which relief can be granted. The court recognizes a cause of action by bystander emotional distress based upon the facts alleged and the cases previously discussed.
Accordingly, the Motion to Strike the second count of the Complaint is denied. CT Page 4630
STUART M. SCHIMELMAN, JUDGE | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3354450/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]MEMORANDUM OF DECISION
The plaintiffs, Edmund and Dolores DiMeglio, have petitioned for temporary and permanent injunctions restraining the defendant, Greg Renshaw, from storing personalty on the plaintiffs' property and for interference with an easement as well as monetary damages. On December 19, 1996, the court held an evidentiary hearing concerning the request for a temporary injunction.
The dispute centers on a strip of land in Putnam, Connecticut, which is partly owned by the plaintiffs and partly owned by the defendant, upon which strip sits a driveway ramp composed of concrete and amesite. The plaintiffs own the eastern half of the strip comprising six feet of width and the defendant owns the western half also comprising six feet of width. Each six foot portion is contiguous to other property owned by the parties. The plaintiffs' portion is encumbered by an easement benefiting the defendant's land, and the defendant's portion is encumbered by an easement benefiting the plaintiffs' land. In other words, the strip forms a twelve foot wide shared driveway which straddles the boundary line dividing the parties' CT Page 562-Q neighboring parcels.
The ramp is 78.5 feet long and rises from street level on Front Street to an elevation of five feet at the opposite end where it abuts an entrance to the defendant's antique store. This store also abuts the strip along its western side. The plaintiffs' property, except for the eastern half of the ramp, is a vacant lot occasionally used as a parking area. A tall, chain-linked fence runs the length of the ramp on the plaintiffs' side.
The defendant purchased his parcel, including his half of the driveway, on November 20, 1992. Sometime thereafter, he erected the chain-link fence mentioned above. As noted, this fence stands entirely on the plaintiffs' property. Also, the defendant constructed a chain-link gate across the width of the driveway about ten feet south of Front Street. The defendant uses both his and the plaintiffs' portion of the ramp surface to display and store several ponderous items such as large pilasters, fireplaces, and other architectural antiques and salvaged material.
The plaintiffs seek to have the personalty, gate, and fence removed. They contend that the defendant has no right to use their property to display his goods nor can he obstruct free passage over the driveway ramp. They ask the court to enjoin the CT Page 562-R defendant from persisting in this activity.
Generally, in order to prevail in an application for a temporary injunction, the applicant must demonstrate that the applicant is likely to prevail at the final hearing; that no adequate remedy at law exists to address the problem; and that the applicant will suffer irreparable injury absent injunctive relief. Griffin Hospital v. Commission on Hospitals and HealthCare, 196 Conn. 451, 456-458 (1958); Covenant Radio Corp. V. TenEighty Corp., 35 Conn. Sup. 1, 3 (1977). However, the irreparable injury requirement is inapplicable in cases of trespass to land.Wambeck v. Lovetri, 141 Conn. 558, 564 (1954).
The court holds that the plaintiffs have met their burden, by clear and convincing evidence, of proving that they will succeed at the final hearing. The land records and surveys clearly show that the plaintiffs are the title owners of the eastern six feet of the driveway and are the beneficiaries of an easement on the western six feet. They have also clearly demonstrated that the defendant has erected a fence and gate enclosing the ramp and has stored and displayed wares throughout the area, including on the plaintiffs' property. The defendant in his posthearing brief submits that, at the final hearing, he will be able to show adverse possession, abandonment, and other defenses to the plaintiffs' claims, but he offered no credible evidence at the CT Page 562-S preliminary hearing to substantiate these defenses.
The court also recognizes that the plaintiffs have no adequate remedy at law to rectify their injury. Monetary damages will not remove the obstructions nor prevent continued trespass to the property. Only injunctive relief will adequately redress these intrusions. As noted above, in cases of trespass to land, irreparable injury is presumed.
Even if the prerequisites to issuance of a temporary injunction exist, the court retains the discretion to decline or limit the relief afforded. Hartford v. American ArbitrationAssociation, 174 Conn. 472, 477 (1978); Phoenix Ins. Co. V.Carey, 80 Conn. 426, 431 (1908). The court orders the defendant to remove all items of personalty which he has placed on the plaintiffs' half of the ramp within thirty days. He is also ordered to remove any items on his portion of the ramp which interfere with pedestrian or vehicular passage on the ramp within thirty days. The defendant is further ordered to leave the gate across the ramp open unless the plaintiffs consent to closure. The court declines to order the razing of the fence and gate because the expense to the defendant far outweighs any benefit to the plaintiffs whose property presently consists of a vacant lot. Also, the fence and gate are safety features necessary to protect persons from falling off the ramp which, at its highest, stands CT Page 562-T five feet above the adjacent grade. These orders shall take effect upon the plaintiffs posting a $5000 surety bond in compliance with G.S. § 52-472.
Sferrazza. J. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1487500/ | 970 S.W.2d 178 (1998)
Michael J. DAUGHETY, et al., Appellants,
v.
NATIONAL ASSOCIATION OF HOMEBUILDERS OF THE UNITED STATES, et al., Appellees.
No. 05-97-00964-CV.
Court of Appeals of Texas, Dallas.
May 21, 1998.
*179 Byron L. Woolley, Simpson, Woolley & McConachie, L.L.P., Dallas, Evan Lane (Van) Shaw, Shaw & Lemon, Dallas, for Appellants.
James Kennedy Taylor, Beck Redden Secrest, Houston, Charles F. Holmans, III, Law Offices of Charles F. Holmans, III, Dallas, Robb L. Voyles, Baker & Botts, LLP, Austin, Janice Vaughn Mock, Dallas, David C. Myers, Jackson & Walker, Dallas, John A. Gilliam, Jenkins & Gilchrist, Dallas, Howard L. Nations, Law Offices of Howard L. Nations, Houston, Randolph N. Wisener, Cantilo, Maisel & Hubbard, Dallas, George Walter Bramblett, Jr., Haynes & Boone, LLP, Dallas, J. Crawford Kerr, El Paso, Michael P. Falzone, Hirschler, Fleischler, Weinber, Cox & Allen, Richmond, VA, Arnold Augur Spencer, Dallas, for Appellees.
Before KINKEADE, MORRIS and BRIDGES, JJ.
OPINION
BRIDGES, Justice.
In this appeal, we must decide whether the trial court abused its discretion in refusing to certify a nationwide class of at least 1.5 million current and former owners of Home Owners Warranty (HOW) insurance policies. Because appellants never requested the trial court to certify the specific class it now contends should have been certified, we conclude no abuse of discretion is shown. Accordingly, we affirm the trial court's order denying certification.
FACTUAL BACKGROUND
In 1973, the National Association of Home Builders (NAHB) created the HOW Program primarily to help its member builders market their homes. HOW was an insurance-backed warranty program that participating builders provided to new homebuyers for a ten-year period to protect them from various construction defects. NAHB insured the builders' liability pursuant to these warranties. If a builder did not fulfill its warranty obligations, the homebuyer could look to HOW for repair or compensation for covered defects.
NAHB owned and operated the program until 1981 when it created and transferred operation of the HOW program to HOW Insurance Company (HOWIC) and its related entities. Under the new arrangement, HOWIC became insurer of the builders' liability pursuant to the warranties. Its members included builders in every state except Alaska. After operating for thirteen years, HOW was placed in receivership in October 1994 by the Virginia Bureau of Insurance, which asserted HOW was in hazardous financial condition. A deputy receiver was appointed to marshal HOW's assets and to pay the contractual claims HOW owed to creditors.
Ultimately, appellants brought this suit in Dallas County, alleging appellees perpetrated a fraud on the market and asserting class certification was proper.[1] In particular, appellants *180 complained that appellees (i) caused misrepresentations, false advertising, and false information to be published and disseminated about the HOW program and (ii) had engaged in a common course of conduct intended to defraud all purchasers of HOW policies. Their third amended petition set forth more than twenty causes of action against appellees, seeking damages for, among other things, personal injuries, including mental anguish and diminution in the value of their homes.
Appellants moved to certify a nationwide class of every person who ever owned a home enrolled in the HOW Program.[2] (The proposed class would include homeowners from forty-nine states.) Specifically, in their amended motion, appellants sought to certify as a class "all homeowners who at any time held certificates of warranty/insurance or had insurance/warranty coverage issued by the HOW Companies putatively insuring their homes...." The motion proposed a number of subclasses and identified twenty-four "common issues of fact or law" relating to, among others, claims for DTPA and insurance code violations, common law actual and constructive fraud, negligence, and misrepresentation.
Two days before the hearing on the motion, appellants revised their class request via a rebuttal brief to appellees' brief and supplemental brief opposing class certification. In the rebuttal brief, "the Class refined itself, its causes of action, and its damages." In particular, appellants proposed a class limited to "those persons who owned a home covered by a HOW warranty/insurance certificate on October 14, 1994, the date of receivership." Further, appellants limited their request to the following "claims": violations of the Texas Insurance Code and Texas Deceptive Trade Practices Act, negligence, negligent misrepresentation, fraud, unjust enrichment and constructive trust, and punitive damages. Appellants also dispensed with damages for mental anguish, emotional distress, personal injuries, diminution in property value, and other damages requiring individual determinations. Instead, appellants limited their damages to those "amenable to proof on a class wide [sic] basis from the books and records of HOW or one or more of the defendants and which are provable by accepted, expert formulation and calculation."
On May 29, 1997, the trial court conducted the hearing at which experts for both sides testified. At the conclusion of the hearing, the trial court denied appellants' first amended motion for class certification without making findings of fact and conclusions of law. Appellants subsequently filed a motion asking the trial court to reconsider its ruling to deny certification, and for the first time, sought certification of a Texas class for claims under the Texas Insurance Code.[3] The trial court apparently denied this request, and this appeal ensued. On appeal, appellants revised their request yet again, asking this Court to hold the trial court abused its discretion in refusing to certify a nationwide class based solely on Texas Insurance Code violations.[4]
*181 CLASS CERTIFICATION
In their second point of error, appellants contend the trial court abused its discretion in denying their amended motion for class certification. Under this point, appellants contend we must reverse the trial court's ruling because the undisputed evidence supports certification of a nationwide class based solely on Texas Insurance Code violations. After reviewing the record in this cause, we conclude the trial court did not abuse its discretion.
Our task on appeal is not to determine in the first instance whether class certification is appropriate in a given case but to determine whether the trial court abused its discretion in denying certification. In that regard, we must first decide what relief was sought in the trial court and thus what issue is now before us on appeal.
As noted above, the trial court hearing, and ultimate order denying certification, was based on appellants' first amended motion for class certification. That motion identified a number of "common issues of law and fact" relating to a variety of theories of recovery. Additionally, the motion proposed a variety of subclasses.[5] Nowhere in the amended motion or any other document, or for that matter at the hearing itself, did appellants seek certification of a nationwide class based solely on Texas Insurance Code violations. To the contrary, the record reflects that appellants sought, at one time or another, certification of the following proposed classes: (1) all homeowners who at any time held certificates of warranty insurance or had insurance or warranty coverage issued by the HOW companies on various causes of action and damages personal to each claimant; (2) those persons who owned a home covered by a HOW warranty insurance certificate on October 14, 1994 on seven causes of action with damages limited to those amenable to proof on a classwide basis; (3) a "Texas class" for claims under the Texas Insurance Code; and (4) on appeal, a nationwide class on Texas Insurance Code violations. Thus, as the record establishes, appellants went to the hearing on one basis, a nationwide class of plaintiffs on seven causes of action, and are appealing the trial court's ruling on a different basis, a nationwide class based on one cause of action. In essence, appellants urge this Court to hold that the trial court abused its discretion in not certifying one specific class based on a single, discrete cause of action out of the numerous proposed classes and causes of action actually requested. This we refuse to do.
Under the rules of civil procedure and the insurance code, a trial court may certify a class action with respect to particular issues, if appropriate; however, nothing in the language of either rule requires a trial court to guess what relief will satisfy a class action proponent. TEX.R. CIV. P. 42(d); TEX. INS.CODE ANN. art. 21.21, § 18(h) (Vernon 1981). Our role as an appellate court is to determine the correctness of the lower court's judgment. See Okere v. Apex Fin. Corp., 930 S.W.2d 146, 152 (Tex.App.Dallas 1996, writ denied). That role is not altered *182 by the fact that we are reviewing a decision on whether to certify a class action. Appellate rules reflect a policy that this Court decide a case in the same posture that was presented to the trial court. Cf. Feldman v. Marks, 960 S.W.2d 613, 616 (Tex.1996) (Gonzalez, J., dissenting) (explaining that appellate rules reflect policy that Supreme Court decide case in same posture as presented to court of appeals). In keeping with that policy, issues to be reviewed by an appellate court must have been actually presented to and considered by the trial court. See de Monet v. PERA, 877 S.W.2d 352, 361 (Tex. App.Dallas 1994, no writ). It is axiomatic that justice is "best served by affording the trial court the first opportunity for review and decision." See State Farm Fire & Casualty Co. v. S.S., 858 S.W.2d 374, 382 (Tex. 1993) (Phillips, C.J., concurring). Addressing matters not specifically presented to the trial court usurps the trial court's authority to evaluate and rule on issues before it and denies the appellate court the benefit of the trial court's decision. de Monet, 877 S.W.2d at 361; S.S., 858 S.W.2d at 381.
In this case, appellants' complaint simply does not comport with the request made of the trial court. We note that the record in this case contains more than 1700 pages plus voluminous exhibits. As is obvious from the record, appellants presented a complex case to the trial court and had several options from which to choose when asking it to certify a class. It was appellants' responsibility to identify the specific relief they sought in the trial court; it was not the trial court's burden to search the record in an attempt to frame relief in a manner that would minimally satisfy appellants. A trial court does not abuse its discretion by not granting a class action proponent less than what it has otherwise specifically requested. To hold otherwise puts the trial judge in the untenable, and inappropriate, position of deciding for class proponents exactly what they could, but did not, ask for. We will not place such a burden on trial courts. Under such circumstances, we cannot conclude the trial court abused its discretion in refusing to do that which it was never asked to do. We overrule the second point of error.
Our disposition of the second point of error makes is unnecessary for us to address the first point of error. See TEX.R.APP. P. 47.1.[6]
We affirm the trial court's order denying class certification.
NOTES
[1] Appellants are Michael J. Daughety, G. Joanne Daughety, Felton J. Davenport, and JoEllen Davenport, who are homeowners and certificate holders of insurance/warranty documents issued by the HOW Companies and who propose to represent the nationwide class in this action. Appellees are the National Association of Homebuilders of the United States, National Academy of Conciliators; Deloitte & Touche, LLP; Ernst & Young, LLP; Boykin & Casano, P.C.; Colton & Boykin, P.C.; Hamilton H. Boykin, individually and as partner of the Law Firms of Boykin & Casano, P.C. and Colton & Boykin, P.C.; Home Owners Warranty Corporation (Council) of Houston, Inc.; Home Owners Warranty Council of Metropolitan Dallas, Inc.; Home Owners Warranty Council of the Golden Crescent Area; Home Owners Warranty Council of Greater El Paso, Inc.; Texas Capitol Area Builders Association; Home Owners Warranty Council of the Builders Association, Inc.; Home Owners Warranty Council of Greater South Texas, Inc.; H. Kenneth Seeber; James I. Barnett; Glenn M. Burns; Terence S. Cooke; John C. Kezer; Robert F. Spies; William F. Kenny; Joseph Chudnow; Dale C. Deharpport; John J. Koelemij; Aaron H. Kolkey; E. Ray Koth; Jack Lageschulte; Sanford B. Miot; Stanley Waranch; and Richard Oprenchak.
[2] Certification was sought pursuant to rule 42 of the Texas Rules of Civil Procedure and article 21.21, sections seventeen through nineteen, of the Texas Insurance Code.
[3] Neither the motion to reconsider nor the trial court's ruling on this motion are contained in the clerk's record. Nevertheless, we accept as true facts stated unless another party contradicts them. TEX.R.APP. P. 38.1(f). Further, appellants are not appealing any ruling on this motion to reconsider.
[4] Additionally, we note that appellants sought leave to file a postsubmission brief, in which they assert the trial court abused its discretion in refusing "to certify a class consisting of 1.7 million homeowners nationwide or, alternatively, the 184,000 homeowners in Texas."
[5] Specifically, the amended motion proposed the following subclasses:
(1) All such persons who have submitted claims under insurance/warranty documents issued by the HOW Companies;
(2) All such persons who participated in a dispute resolution process under the
HOW warranty/insurance document in which the National Academy of Conciliators participated;
(3) All such persons who own a home with a loss alleged to be covered by insurance/warranty documents issued by the HOW Companies but who have yet to submit a claim;
(4) All such persons who own homes who may incur a loss covered by insurance/warranty documents issued by the HOW Companies;
(5) Members of the insurance-buying public who have submitted claims for losses to their homes under the HOW insurance/warranty documents issued by the HOW Companies;
(6) Members of the insurance-buying public who participated in a dispute resolution process involving losses to their homes under the HOW insurance/warranty documents in which NAC participated;
(7) Members of the insurance-buying public who own a home with a loss alleged to be covered by insurance/warranty documents issued by the HOW Companies but who have yet to submit a claim; and
(8) Members of the insurance-buying public who own homes and who may incur a loss covered by insurance/warranty documents issued by the HOW Companies.
[6] Appellants' first point of error complains that the trial court erred in excluding from consideration certain material presented in support of certification and in imposing a "strict" standard of evidence at the hearing. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1531204/ | 72 B.R. 948 (1987)
In re Johnny L. EASLEY, Debtor.
Marc NELSON, Movant,
v.
Johnny L. EASLEY, Respondent.
Bankruptcy No. 385-01795.
United States Bankruptcy Court, M.D. Tennessee.
May 1, 1987.
Jack E. Seaman, Lyell & Jackson, Nashville, Tenn., for debtor.
D. Reed Houk, Stokes & Bartholomew, Nashville, Tenn., for Marc Nelson.
MEMORANDUM
KEITH M. LUNDIN, Bankruptcy Judge.
The holder of an unsecured claim declared nondischargeable in debtor's preconversion Chapter 7 case objects to confirmation of this composition Chapter 13 plan on grounds that the debtor has failed to commit all projected disposable income as required by 11 U.S.C. § 1325(b) and the plan has not been proposed in good faith as required by 11 U.S.C. § 1325(a)(3). The debtor has committed all projected disposable income and the plan is proposed in good faith. Confirmation will be denied because of an unfairly discriminatory classification of claims.
The following constitute findings of fact and conclusions of law. Bankr. R. 7052. This is a core proceeding. 28 U.S.C. § 157(b)(2)(L) (Supp. II 1984).
I.
Debtor was arrested in 1984 and while in custody, attacked and injured a guard, Marc Nelson ("Nelson"). Debtor was prosecuted criminally for aggrevated assault. Nelson sued debtor for damages in state court. Trial was stayed by debtor's Chapter 7 petition.
On September 30, 1985, this court granted Nelson relief from the stay to liquidate the assault claim. The state court awarded Nelson compensatory and punitive damages totalling $19,000. Nelson then filed an adversary proceeding in the bankruptcy case to determine the dischargeability of the state court judgment. On March 31, 1986, this court ruled that the $19,000 claim was nondischargeable pursuant to 11 U.S.C. § 523(a)(6). Debtor then converted the Chapter 7 case to Chapter 13.
*949 Debtor's Chapter 13 plan proposes to pay $30 per week for 36 months. One unsecured claim holder with a cosigned debt is separately classified for full payment. Nelson would be paid approximately 12%.
II. PROJECTED DISPOSABLE INCOME
Upon objection by the holder of an allowed unsecured claim, the Bankruptcy Code forbids confirmation of a Chapter 13 plan unless (1) the objecting claim holder will be paid in full, or (2) the debtor commits all "projected disposable income" to funding the plan for 36 months. 11 U.S.C. § 1325(b)(1) (1982 ed. & Supp. III 1986).[1]
The Code restates "disposable income" as "income which is received by the debtor and which is not reasonably necessary to be expended (A) for the maintenance or support of the debtor or a dependant of the debtor." 11 U.S.C. § 1325(b)(2) (1982 ed. & Supp. III 1986).
There has been much discussion of what constitutes "reasonably necessary" expenses for § 1325(b) purposes. See, e.g., In re Rogers, 65 B.R. 1018 (Bankr. E.D. Mich. 1986); In re Kitson, 65 B.R. 615 (Bankr. E.D.N.C. 1986); In re Foster, 61 B.R. 492 (Bankr. N.D.Ind. 1986); In re Greer, 60 B.R. 547, 14 BANKR. CT. DEC. (CRR) 588 (Bankr. C.D.Cal. 1986); In re Red, 60 B.R. 113, 14 COLLIER BANKR. CAS.2d (MB) 696 (Bankr. E.D.Tenn.1986); In re Tinneberg, 59 B.R. 634 (Bankr. E.D.N.Y. 1986); In re Jones, 55 B.R. 462 (Bankr. D.Minn.1985); In re Festner, 54 B.R. 532 (Bankr. E.D.N.C.1985); In re Sturgeon, 51 B.R. 82 (Bankr. S.D. Ind. 1985); In re Otero, 48 B.R. 704 (Bankr. E.D.Va.1985). No bright line definitions have emerged. These are fact questions which must be determined in the context of individual debtors and their dependents. There is the notion that "reasonable" means "adequate" but not "first-class." See In re Kitson, 65 B.R. 615 (Bankr. E.D.N.C.1986).
Debtor's amended budget commits $30 to the plan from a weekly take-home pay of $262.30. Debtor's monthly mortgage payment is $321 and utilities are budgeted at $154. These amounts are reasonable for middle Tennessee. Food of $200 per month is reasonable. Monthly clothing expense of $20 and laundry expense of $10 are consistent with the debtor's simple lifestyle. Doctor expenses of $50 per month were justified for dental work, psychiatric attention and prescriptions. Debtor takes medicine twice daily to control violent outbursts and a psychiatrist monitors the medication. Transportation, including vehicle repair and gasoline is reasonably estimated at $125 per month. Automobile insurance is $41 per month. Barber shop expense of $18 and house maintenance of $60 a month were marginally justified by the debtor but are not unreasonable in an amended budget which reflects no allocation for recreation, newspapers, church contributions or club dues.[2] Debtor testified he would commit part of future tax refunds to the plan and use the balance to purchase a stove, refrigerator, and bedroom furniture. The plan does not commit future pay increases, but there was no evidence that raises are likely. See In re Krull, 54 B.R. 375 (Bankr. D.Colo.1985) (future salary increases too speculative to be "projected"). Debtor testified he incurred additional expense for furnace replacement after the amended budget. He is also now divorced and the *950 divorce settlement requires him to pay $10 a week.
The expenses in debtor's budget are reasonably necessary for maintenance and support. Debtor satisfies the disposable income test of 11 U.S.C. § 1325(b) (1982 ed. & Supp. III 1986).
III. GOOD FAITH
A Chapter 13 plan must be proposed in good faith. 11 U.S.C. § 1325(a)(3) (1982 ed. & Supp. III 1986). The Bankruptcy Code does not define "good faith." There is no illuminating legislative history. More than 300 reported "good faith" decisions form a maze of rules and exceptions swallowing rules. Nearly identical fact patterns have produced inconsistent results within judicial districts and across the circuits. The reported decisions demonstrate that "good faith" is an illusive statutory description of the limits of Chapter 13 relief.
A significant number of circuit courts have reduced "good faith" to lists of factors. See Neufeld v. Freeman, 794 F.2d 149, 152 (4th Cir.1986); Flygare v. Boulden, 709 F.2d 1344 (10th Cir.1983); Kitchens v. Georgia Railroad Bank & Trust Co. (In re Kitchens), 702 F.2d 885, 888 (11th Cir.1983); United States v. Estus (In re Estus), 695 F.2d 311, 317 (8th Cir. 1982); Deans v. O'Donnell, 692 F.2d 968, 972 (4th Cir.1982); Goeb v. Heid, 675 F.2d 1386 (9th Cir.1982); Ravenot v. Rimgale (In re Rimgale), 669 F.2d 426, 432 (7th Cir.1982). Other courts have adopted generic tests of good faith: examination of the "totality of the circumstances," or "honesty of intention." See Public Finance Corp. v. Freeman, 712 F.2d 219 (5th Cir.1983); Barnes v. Whelan, 689 F.2d 193 (D.C. Cir.1982).
The sixth circuit has not prescribed a list of good faith attributes. At least 16 factors have been considered by other circuits. Many of the stated components of "good faith" are duplicative of specific standards for confirmation applied elsewhere in the Bankruptcy Code. Some factors adopted in early decisions are affected by subsequent amendments to the Bankruptcy Code.
A. FREQUENCY OF FILING BANKRUPTCY
Multiple and successive bankruptcy filings by the same debtor are a problem in some judicial districts. See, e.g., In re Kinney, 51 B.R. 840 (Bankr. C.D.Cal.1985) (10 filings including multiple Chapter 13 cases by related family members); Snow v. Jones (In re Jones), 41 B.R. 263 (Bankr. C.D.Cal. 1984) (six petitions, including four Chapter 13's in an effort to defeat a foreclosure). The frequency of filing is cited as a factor bearing on a Chapter 13 debtor's good faith. See, e.g., Johnson v. Vanguard Holding Corp., 708 F.2d 865 (2d Cir.1983); Deans v. O'Donnell, 692 F.2d 968 (4th Cir. 1982); Kitchens v. Georgia Railroad Bank & Trust Co. (In re Kitchens), 702 F.2d 885 (11th Cir.1983); United States v. Estus (In re Estus), 695 F.2d 311 (8th Cir.1982).
The 1984 amendments to 11 U.S.C. § 109(g) (as renumbered in 1986) reduce the importance of a debtor's filing history as a feature of good faith. Section 109(g) prohibits an individual debtor from refiling bankruptcy within 180 days of the dismissal of a bankruptcy case under certain circumstance.[3] Congress has thus precluded refiling of bankruptcy where it perceived abuse. If a debtor is not disabled to refile by § 109(g), it is not obvious that a permitted refiling should be indicative of "bad faith" for Chapter 13 purposes.
According to the statement of affairs, this debtor's first Chapter 7 case was converted to this Chapter 13 case. No abuse is apparent.
*951 B. ACCURACY OF PETITION, STATEMENTS AND SCHEDULES
Where the debtor misrepresents income, expenses, assets or other matters in the petition, statements or schedules, "good faith" is wanting and confirmation has been denied. See, e.g., In re Kelley, 58 B.R. 927 (Bankr. D.Del.1986) (debtors misrepresented value of assets and understated income); In re DeReus, 53 B.R. 362 (Bankr. S.D.Cal.1985) (evasive, conflicting and inaccurate information); In re Cash, 51 B.R. 927 (Bankr. N.D.Ala.1985) (omission of debts); In re Sullivan, 40 B.R. 914 (Bankr. E.D.N.Y.1984) (debtor refused to supply financial information about overseas investment business); In re Smith, 39 B.R. 57 (Bankr. S.D.Fla.1984) (failure to list creditors); In re Delany, 28 B.R. 956 (Bankr. D.Conn.1983) (debtor inadequately disclosed financial contributions to family members and misstated the existence of dependents).
This debtor's statements and schedules are reasonably accurate. It was necessary to amend the Chapter 13 budget, but the amendments were explained by changes in income and expenses including the loss of overtime.
C. MOTIVATION IN FILING CHAPTER 13
D. INITIAL FILING OF CHAPTER 7 RATHER THAN CHAPTER 13
E. EXISTENCE OF DEBT NONDISCHARGEABLE IN A CHAPTER 7 CASE
F. CIRCUMSTANCES OF INCURRING DEBT
G. NATURE AND AMOUNT OF UNSECURED DEBT
Several courts have considered prepetition and preplan conduct for evidence of the debtor's motive and intent. See, e.g., Chinichian v. Campolongo (In re Chinichian), 784 F.2d 1440, 14 BANKR. CT. DEC. (CRR) 541 (9th Cir.1986) (Chapter 13 filed solely to defeat state court specific performance litigation); In re Wall, 52 B.R. 613, 13 BANKR. CT. DEC. (CRR) 625 (Bankr. M.D.Fla.1985) (bad faith to use Chapter 13 to avoid prepetition fraud); In re Myers, 52 B.R. 248, 13 BANKR. CT. DEC. (CRR) 626 (Bankr.M.D.Fla.1985) (bad faith where debtor filed Chapter 13 immediately after borrowing $2,200); In re San Miguel, 40 B.R. 481, 12 BANKR. CT. DEC (CRR) 194 (Bankr. D.Colo.1984) (bad faith where real purpose of proposed plan is to defer attorney's fees, not repay creditors); In re Stein, 36 B.R. 521 (Bankr. M.D.Fla. 1983) (bad faith where sole purpose of plan is to deal with a mortgage holder); In re Gates, 42 B.R. 4 (Bankr. N.D.Ga.1983) (sole purpose of third Chapter 13 case was to thwart a foreclosure sale).
Debtors often "use" Chapter 13 to manage the effects of prepetition misconduct. The Bankruptcy Code invites eligible individuals to do just that Chapter 13 allows the discharge of many debts that would be nondischargeable in Chapter 7. Compare 11 U.S.C. § 1328 (1982 ed. & Supp. III 1986) with §§ 727 and 523. The quid pro quo for this enhanced discharge includes payment of all disposable income for at least 36 months and compliance with the other requirements of 11 U.S.C. § 1325. That a substantial portion of the debt scheduled by a Chapter 13 debtor resulted from suspect prepetition conduct may be indicative of careful legal advice debtors are counseled to file Chapter 13 to deal with potentially nondischargeable claims.
If Congress intended to render debtors ineligible for Chapter 13 relief or ineligible to confirm a plan where claims are or might be nondischargeable in a Chapter 7 case, then that statement would appear in the conversion sections of Chapter 7 and/or in the confirmation or discharge provisions of Chapter 13. Just the opposite is true. Section 1328(a) grants Chapter 13 debtors a broader discharge. A Chapter 7 debtor has an absolute right to convert to Chapter 13 if the debtor is eligible for Chapter 13 relief and has not previously converted from another chapter. 11 U.S.C. § 706(a) (1982 ed. & Supp. III 1986). This right cannot be waived. This right can be exercised after a judgment of nondischargeability in the Chapter 7 case.
*952 Some decisions conclude that conversion to Chapter 13 after losing a discharge or dischargeability battle in Chapter 7 is relevant to good faith but not conclusive of bad faith. See Ravenot v. Rimgale (In re Rimgale), 669 F.2d 426, 431-32 (7th Cir. 1982) (good faith cannot be defined as "the absence of any conduct that would traditionally have barred discharge, without rendering Chapter 13's discharge provisions nugatory."); Street v. Lawson (In re Street), 55 B.R. 763, 765 (Bankr. 9th Cir. 1985) ("A conversion from Chapter 7 to Chapter 13 following an adverse decision on a dischargeability action is not a `manipulation of the Bankruptcy Code.'"); In re Caldwell, 67 B.R. 296, 303 (Bankr.E.D. Tenn.1986) (plan was not proposed in bad faith simply because it proposes to deal with nondischargeable debts from preconversion Chapter 7); In re Parameswaran, 64 B.R. 341 (Bankr.S.D.N.Y.1986) (conversion from Chapter 7 to Chapter 13 permitted notwithstanding successful objection to discharge in Chapter 7 case); In re McMonagle, 30 B.R. 899, 10 BANKR. CT. DEC. (CRR) 1086 (Bankr.D.S.D.1983) (confirms plan comprising debt declared nondischargeable in Chapter 7 case converted to Chapter 13); In re Martini, 28 B.R. 932 (Bankr. S.D.N.Y.1983) (not bad faith to pay less than 100% of loan declared nondischargeable in prior liquidation case);.
Many courts have confirmed Chapter 13 plans over good faith objections notwithstanding composition of claims that would be nondischargeable in a Chapter 7 case. See, e.g., Neufeld v. Freeman, 794 F.2d 149 (4th Cir.1986) (compromise of obligation that would be nondischargeable in Chapter 7 is not alone bad faith); Wisconsin Higher Education Corp. v. Bear, 789 F.2d 577, 14 COLLIER BANKR. CAS.2d (MB) 1054 (7th Cir.1986) (student loans); In re Kazzaz, 62 B.R. 308 (Bankr. E.D. Va.1986) (larceny claim); In re Whitehead, 61 B.R. 397, 399 (Bankr.D.Or.1986) (conversion); In re Rushton, 58 B.R. 36 (Bankr.M.D.Ala.1986) (student loans); In re Krull, 54 B.R. 375 (Bankr.D.Colo.1985) ("wrongful conduct"); In re Peterson, 53 B.R. 339 (Bankr.D.Or. 1985) (student loan); In re McBroom, 51 B.R. 953 (Bankr.W.D.Va.1985) (fraud); In re Dos Passos, 45 B.R. 240, 12 BANKR. CT. DEC. (CRR) 809 (Bankr.D.Mass.1984) (student loans); In re McAloon, 44 B.R. 831, 12 BANKR. CT. DEC. (CRR) 578 (Bankr.E.D.Va.1984) (student loans); In re Edwards, 51 B.R. 792 (Bankr.D.N.M.1984) (embezzlement); In re Vensel, 39 B.R. 866 (Bankr.E.D.Va.1984) (student loans); In re Eppers, 38 B.R. 301, 10 COLLIER BANKR. CAS.2d 812 (Bankr.D.N.M.1984) (misrepresentation, conversion); In re Ramus, 37 B.R. 723 (Bankr.N.D.Ga.1984) (tort liability); In re Ali, 33 B.R. 890, 11 BANKR.CT.DEC. (CRR) 57 (Bankr.D.Kan. 1983) (student loan); In re Jones, 31 B.R. 485 (Bankr.N.D.Ill.1983) (public assistance overpayments);.
Other courts have refused confirmation of plans proposing to compromise nondischargeable claims. See, e.g., In re Hale, 65 B.R. 893 (Bankr.S.D.Ga.1986) (student loan); In re Todd, 65 B.R. 249 (Bankr.N.D. Ill.1986) (civil rights judgment); In re Doersam, 60 B.R. 130 (Bankr.S.D.Ohio 1986) (student loans); In re Geehan, 59 B.R. 600 (Bankr.S.D.Ohio 1986) (student loans); In re Brown, 56 B.R. 293 (Bankr.N. D.Ill.1985) (fraud); In re Myers, 52 B.R. 248, 13 BANKR. CT. DEC. (CRR) 626 (Bankr.M.D.Fla.1985) (fraud); In re Wall, 52 B.R. 613, 13 BANKR. CT. DEC. (CRR) (Bankr.M.D.Fla.1985) (fraud); In re Sanabria, 52 B.R. 75 (N.D.Ill.1985) (student loans); In re Vance, 49 B.R. 973, 12 COLLIER BANKR. CAS.2d (MB) 1392 (Bankr. D.Minn.1985) (student loans); In re Brock, 47 B.R. 167 (Bankr.S.D.Cal.1985) (embezzlement); In re Nkanang, 44 B.R. 955 (Bankr.N.D.Ga.1984) (student loans); In re Williams, 42 B.R. 474, 12 BANKR. CT. DEC. (CRR) 435 (Bankr.E.D.Ark.1984) (student loans); In re Chase, 43 B.R. 739, 12 BANKR. CT. DEC. (CRR) 217 (D.Md.1984) (criminal conduct); In re Beauty, 42 B.R. 655 (E.D.La.1984) (nondischargeable debts surviving prior discharge); In re Dalby, 38 B.R. 107 (Bankr.D.Utah 1984) (student loans); In re Johnson, 36 B.R. 67 (Bankr.S. D.Ill.1984) (student loans); In re Boyd, 57 B.R. 410 (Bankr.N.D.Ill.1983) (fraud); In re Hawkins, 33 B.R. 908 (Bankr.S.D.N.Y. 1983) (student loans); In re Canda, 33 B.R. 75, 10 BANKR. CT. DEC. (CRR) 1361 (Bankr.D.Or.1983) (student loans); In re *953 Sotter, 28 B.R. 201, 10 BANKR. CT. DEC. (CRR) 369 (Bankr.S.D.N.Y.1983) (criminal conduct); Margraf v. Oliver (In re Oliver), 28 B.R. 420 (Bankr.S.D.Ohio 1983) (fraud).
There is no obvious pattern to when the presence of a nondischargeable claim results in a plan failing of good faith.[4] It is this court's view that the dischargeability of claims is specifically resolved by other sections of the Code and is not also a component of § 1325(a)(3). However, it is the law of this circuit that a debtor's preplan misconduct may affect the good faith calculus.
In Memphis Bank & Trust Co. v. Whitman, 692 F.2d 427 (6th Cir.1982), the debtor "puffed" her income on an auto loan application two months before filing Chapter 13. The proposed plan seemed to pay 100% of the claim secured by the car but because the claim was split into secured and unsecured portions, the creditor would lose its contract interest under the plan on part of its claim. The sixth circuit expressed concern that "the liberal provisions of the new Chapter 13 are subject to abuse," and interpreted "good faith" to require consideration of a debtor's preplan[5] conduct:
We should not allow a debtor to obtain money, services or products from a seller by larceny, fraud or other forms of dishonesty and then keep his gain by filing a Chapter 13 petition within a few days of the wrong. To allow the debtor to profit from his own wrong ... runs the risk of turning otherwise honest consumers and shopkeepers into knaves.
Id. at 432. Where the debtor's preplan conduct in incurring the debt is "dishonest" the court states "the plan simply should not be confirmed." Id. Where the preplan conduct is "questionable" but not dishonest, the circuit would require "full payment in accordance with the contract." Id.
Application of Memphis Bank to these facts is uncertain. This debtor did not obtain money, services or products from a seller by "dishonesty." This debtor did not engage in "questionable" conduct to obtain economic advantage. The debtor "contracted" his debt to Nelson as a result of a violent outburst. Debtor did not know the victim personally. Nelson will be paid less than his full judgment through the proposed plan but, given the debtor's small income, it is problematic what amounts Nelson could collect from the debtor over what period absent bankruptcy. If the debtor's preplan conduct fits into Memphis Bank, it must be in the "questionable" category.
The sixth circuit decided Memphis Bank in 1982. In 1984, Congress amended the confirmation standards of § 1325 to include new § 1325(b). As discussed above and below, new § 1325(b) demonstrates congressional intent that an objecting unsecured claim holder can be satisfied in a Chapter 13 case by full payment or by commitment of all projected disposable income for a minimum of 36 months.
The percentage repayment discussion of good faith in Memphis Bank is eroded by the later enactment of § 1325(b). To require 100% payment of claims that arise from "questionable" preplan conduct as an element of "good faith" would render the general provisions of § 1325(a)(3) more *954 stringent than the specific economic test contained in new § 1325(b). Memphis Bank can be accommodated with new § 1325(b) by holding that questionable preplan conduct is a consideration in good faith analysis, but does not mandate a specific percentage of repayment.
This debtor did not have a substantial debt problem until his assault of Nelson. That prepetition conduct was reprehensible. The debtor was appropriately prosecuted by the State. Congress permits the civil damages to be dealt with in a Chapter 13 case. The debt that resulted cannot be paid in full by this debtor within the limits of a Chapter 13 case. The debtor is eligible for Chapter 13 relief but can confirm a plan only if a composition is permitted. As demonstrated below, this plan meets the economic tests for confirmation.
H. PROBABLE DURATION OF PLAN
I. DEGREE OF EFFORT
J. LIKELIHOOD OF FUTURE INCREASES IN INCOME
K. PERCENTAGE OF REPAYMENT OF DEBT
L. AMOUNT OF PROPOSED PAYMENTS
M. AMOUNT OF SURPLUS IN BUDGET
Prior to the 1984 enactment of § 1325(b), the courts struggled to define the measure of effort required of a debtor as a component of good faith. Some courts demanded a debtor's "best efforts" as described in 11 U.S.C. § 727(a)(9). In re Burrell, 2 B.R. 650 (Bankr.N.D.Cal.1980); In re Raburn, 4 B.R. 624 (Bankr.M.D.Ga.1980). That view was rejected in this district. In re Raines, 33 B.R. 379, 381 (M.D.Tenn.1983) ("if `good faith' was synonymous with `best efforts' then Congress would have had no need to include both of these terms in § 727(a)(9)"). Other courts concluded that a Chapter 13 plan must minimally satisfy the "best interests of creditors" test under 11 U.S.C. § 1325(a)(4). In re Harland, II, 3 B.R. 597 (Bankr.D.Neb.1980); In re Cloutier, 3 B.R. 584 (Bankr.D.Colo.1980); In re Sadler, 3 B.R. 536 (E.D.Ark.1980). Courts have also observed that the upper limits of a debtor's effort is defined by the "feasibility" requirement of 11 U.S.C. § 1325(a)(6). In re Goodavage, 41 B.R. 742 (Bankr.E.D.Va. 1984); In re Perskin, 9 B.R. 626 (Bankr.N. D.Tex.1981); In re Howard, 3 B.R. 75 (Bankr.S.D.Cal.1980).
Sections 1325(a)(4), (6) and (b) and 1322(c) fully circumscribe the "effort" that a debtor can or must make in a Chapter 13 case. The "best interests of creditors" test of § 1325(a)(4) requires that unsecured claim holders receive at least what they would be paid in a Chapter 7 liquidation. This debtor's Chapter 13 plan proposes to pay substantially more than unsecured claim holders would receive in a Chapter 7 case.[6]
The feasibility test of § 1325(a)(6) requires that the debtor be able to make all payments proposed by the plan. This is the maximum a debtor may endeavor to pay. This debtor has been employed by the Water and Sewer Department of Nashville for several years and his continued employment is likely. Debtor has a 12th grade education, is 26 years old and appears to be in good physical health. The proposed payment of $30 per week is allowed by § 1325(a)(6).
The "disposable income" test of § 1325(b) requires a Chapter 13 debtor to exhaust available income in payments through the plan for a period of 36 months. Section 1322(c) prohibits a debtor to provide *955 for payments longer than three years without demonstrating cause. This debtor proposes payment of all disposable income for 36 months consistent with §§ 1325(b) and 1322(c).
This debtor thus satisfies the economic tests for confirmation of a Chapter 13 plan. An independent economic test is not required as a component of "good faith." As Judge Bare explained in In re Red, 60 B.R. 113, 14 COLLIER BANKR. CAS.2d (MB) 696 (Bankr.E.D.Tenn.1986), the percentage of repayment is not appropriately considered as an element of good faith where the plan meets the statutory mandate of § 1325(b). See also Holiday v. Tennessee Student Assistance Corp. (In re Holiday), No. 386-0499 (M.D.Tenn. October 1, 1986).
N. SPECIAL CIRCUMSTANCES
Occasionally, courts have found evidence of "good faith" in special circumstances such as extraordinary medical expenses. This debtor has not been the victim of extraordinary "outside" forces. The debtor is now in treatment for the condition that may have contributed to the debtor's need for Chapter 13 relief.
O. BURDEN OF ADMINISTRATION
It is not obvious how a Chapter 13 plan could burden the Chapter 13 trustee in a manner indicative of a lack of "good faith." It has been said that good faith does not require that a Chapter 13 plan support its weight in administrative costs. In re Snow, 33 B.R. 113 (N.D.Ill.1983); In re Harland, II, 3 B.R. 597 (Bankr.D.Neb. 1980).
This proposed Chapter 13 plan presents no unusual administrative problems.
P. AMOUNT OF ATTORNEY'S FEES
A Chapter 13 plan which only pays the debtor's attorney's fees is suspect of good faith. See In re San Miguel, 40 B.R. 481, 12 BANKR. CT. DEC. (CRR) 194 (Bankr.D. Colo.1984). This is not such a case. The plan proposes to pay $468 to debtor's counsel. This is not a significant portion of total debt and is reasonable.
Q. GENERIC TESTS
The generic tests "fundamental fairness," "totality of the circumstances," and "honesty of intention" describe overall impressions of a debtor.
This debtor passes the "smell" test. The totality of this debtor's circumstances leaves the debtor no alternative but a composition Chapter 13 plan. The debtor presented evidence that this Chapter 13 plan is part of an honest effort to get control of the personal problems that led to this debt problem. The debtor intends to pay as much as a reasonable budget permits over the statutory period fixed by Congress. The debtor has not evaded his obligation to Nelson except as permitted by the Bankruptcy Code. The debtor has been punished for his prepetition misconduct in the manner prescribed by other law. It is not fundamentally unfair to permit this debtor to attempt consummation of a Chapter 13 plan.
IV. CLASSIFICATION OF CLAIMS
Though articulated as a good faith objection, Nelson challenges the debtor's proposed classification of claims. Classification of claims in a Chapter 13 case is not controlled by the good faith standard of § 1325(a)(3). Classification is regulated by 11 U.S.C. § 1322(b)(1).
Prior to amendment in 1984, § 1322(b)(1) read as follows:
Subject to subsections (a) and (c) of this section, the plan may
(1) designate a class or classes of unsecured claims, as provided in section 1122 of this title, but may not discriminate unfairly against any class so designated.
The 1984 amendments sanctioned special treatment for co-signed debts:
Subject to subsections (a) and (c) of this section the plan may
(1) designate a class or classes of unsecured claims, as provided in section 1122 of this title, but may not discriminate unfairly against any class so designated; however, such plan may treat claims for a consumer debt of the debtor if an individual is liable on such consumer *956 debt with the debtor differently than other unsecured claims.
The 1984 amendment is awkwardly worded. To give meaning to all words in the amended section, it must be true that a debtor's power to treat co-signed consumer debts "differently" has content separate from the proscription against unfair discrimination. The awkward language is resolved by holding that all different treatments are not necessarily fair discriminations.
This debtor proposes two classes of unsecured claim holders. Class I, to be paid in full, contains a single co-signed consumer debt. Class II, to be paid approximately 12%, contains only Nelson.
This classification of unsecured claims is unfairly discriminatory. The debtor has offered no proof of any circumstances justifying the proposed discrimination. There is no statement of the underlying logic, facts or bases for this classification. Mathematically, this debtor could propose a single class of unsecured claim holders all of whom would receive at least 18%. On this absence of evidence, it is unfair to discriminate against the victim of the debtor's prepetition misconduct. See In re Harris, 62 B.R. 391 (Bankr.E.D.Mich.1986); In re Perkins, 55 B.R. 422, 13 BANKR. CT. DEC. (CRR) 811 (Bankr.N.D.Okla.1985); AMFAC Distribution Corp. v. Wolff, 22 B.R. 510, 9 BANKR. CT. DEC. (CRR) 451 (Bankr. 9th Cir.1982); In re Dziedzic, 9 B.R. 424 (Bankr.S.D.Tex.1981); In re Kovich, 4 B.R. 403, 6 BANKR. CT. DEC. (CRR) 482, 2 COLLIER BANKR. CAS.2D (MB) 203 (Bankr.W.D.Mich.1980).
The proposed plan satisfies the disposable income test of § 1325(b)(1) and is proposed in good faith pursuant to § 1325(a)(3). Confirmation is denied because the plan discriminates unfairly against a class of unsecured claim holders.
An appropriate order will be entered.
NOTES
[1] 11 U.S.C. § 1325(b)(1), added to the Code by the Bankruptcy Amendments and Federal Judgeship Act of 1984, reads in full:
If the trustee or the holder of an allowed unsecured claim objects to the confirmation of the plan, then the court may not approve the plan unless, as of the effective date of the plan
(A) the value of the property to be distributed under the plan on account of such claim is not less than the amount of such claim; or
(B) the plan provides that all of the debtor's projected disposable income to be received in the three-year period beginning on the date that the first payment is due under the plan will be applied to make payments under the plan.
11 U.S.C. § 1325(b)(1) (1982 ed. & Supp. III 1986).
[2] The debtor's original budget reflected slightly higher income and several expense items of questionable reasonableness for example, Mason dues of $30 per month and veterinarian expenses of $10 per month. These items were eliminated by the amended budget and income was slightly reduced by lost overtime.
[3] 11 U.S.C. § 109(g) reads in full:
Notwithstanding any other provision of this section, no individual or family farmer may be a debtor under this title who has been a debtor in a case pending under this title at any time in the preceding 180 days if
(1) the case was dismissed by the court for willful failure of the debtor to abide by orders of the court, or to appear before the court in proper prosecution of the case; or
(2) the debtor requested and obtained the voluntary dismissal of the case following the filing of a request for relief from the automatic stay provided by section 362 of this title.
11 U.S.C. § 109(g) (1982 ed. & Supp. III 1986).
[4] Especially confusing are the student loan cases collected above. In the 1978 Code, Congress focused on government guaranteed loans and determined that certain educational loans would be nondischargeable in Chapter 7 cases. See 11 U.S.C. § 523(a)(8) (1982 ed. & Supp. III 1986). Congress determined not to bar the dischargeability of educational loans in a Chapter 13 case. See 11 U.S.C. § 1328(a) (1982 ed. & Supp. III 1986). Congress has enacted other statutes protecting special kinds of student loans from discharge in all bankruptcy cases. See In re Johnson, 787 F.2d 1179, 14 BANKR. CT. DEC. (CRR) 550 (7th Cir.1986) (Health Education Assistance Loans not subject to discharge pursuant to 42 U.S.C. § 294f(g)). Given repeated congressional attention to this subject and the failure of Congress to include a provision barring the dischargeability of all student loans (other than HEAL loans) in Chapter 13 cases, it is difficult to argue that the presence of a student loan is an element of good faith under § 1325(a)(3).
[5] "Preplan" is the word used by the sixth circuit in Memphis Bank. The conduct at issue in Memphis Bank was "prepetition." The conduct complained of herein is both prepetition the assault and preplan conversion to Chapter 13 after a judgment of nondischargeability in the Chapter 7 case. Both are theoretically within the ambit of Memphis Bank.
[6] The courts have overwhelmingly rejected the argument that 11 U.S.C. § 1325(a)(4) requires special treatment of the holder of a claim that would be nondischargeable in a Chapter 7 case. In re Hawkins, 33 B.R. 908 (Bankr.S.D.N.Y. 1983) (plan payment need only exceed the liquidation value of the debtor's property; the test involves no comparison of plan payments and the amount the creditor might receive upon collection of a nondischargeable debt in a Chapter 7 case). Accord Phoenix Institute of Technology v. Klein, 57 B.R. 818 (Bankr. 9th Cir.1985); In re Kazzaz, 62 B.R. 308 (Bankr.E.D.Va.1986); In re Akin, 54 B.R. 700 (Bankr.D.Neb.1985); In re McMonagle, 30 B.R. 899, 10 BANKR. CT. DEC. (CRR) 1086 (Bankr.D.S.D.1983); In re Severs, 28 B.R. 61 (Bankr.S.D.Ohio 1982); Security Ins. Co. v. Vratanina, 22 B.R. 453, 9 BANKR. CT. DEC. (CRR) 614 (Bankr.N.D.Ill.1982); In re Graves, 19 B.R. 402, 9 BANKR. CT. DEC. (CRR) 30 (Bankr.W.D.La.1982). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563996/ | 616 S.W.2d 292 (1981)
CITY OF ROSENBERG, et al, Appellants,
v.
Bernard S. RENKEN, Jr., Appellee.
No. A2550.
Court of Civil Appeals of Texas, Houston (14th Dist.).
Decided March 25, 1981.
Opinion On Remittitur Being Filed April 1, 1981.
Rehearing Denied April 29, 1981.
*293 Michael P. Morris, Mark Allen, Tekell, Book & Matthews, D. Craig Olivier, Vinson & Elkins, Houston, for appellants.
Wm. Mac Gann, Gann, Fried & Edwards, Houston, for appellee.
Before BROWN, C. J., and JUNELL and PAUL PRESSLER, JJ.
PAUL PRESSLER, Justice.
This is an appeal from a judgment in favor of Appellee for damages from an eye injury. It is undisputed that Appellee's right eye was seriously injured when struck by a piece of gravel thrown by the spinning tire of a City of Rosenberg vehicle. This vehicle was being negligently operated by the individual Appellant, Marty Dawson, while in the course and scope of his employment with the City. Trial was to a jury which found in Appellee's favor on all points with damages totaling $109,500. On June 24, 1980 a final judgment was signed awarding Appellee that amount.
Appellants bring ten separate points of error. Points of Error numbered 1, 3, 4, 5, 6, 7, 8 and 9 complain that the evidence was insufficient to support the jury's answers to each subdivision of the damage issue. In reviewing "insufficient evidence" points we must consider all the evidence both for and against the jury's findings. In re King's Estate, 150 Tex. 662, 244 S.W.2d 660, 662 (1951).
For medical expenses from the date of the accident to the date of trial, Appellee is entitled only to reasonable medical expenses necessarily incurred as the result of the accident. Bronwell v. Williams, 597 S.W.2d 542 (Tex.Civ.App.-Amarillo 1980, writ ref'd n. r. e.). The only evidence in the record of such medical expenses totals $3223. Therefore the finding of the jury that past medical expenses amounted to $3500 is excessive by $277.
Recovery for future medical expenses requires a showing that there is a reasonable probability that such medical expenses will be incurred in the future. Fisher v. Coastal Transport Co., 149 Tex. 224, 230 S.W.2d 522 (1950). The reasonable value of those services may be established by evidence of the reasonable value of past medical treatment of a similar nature. Thate v. Texas and Pacific Railway Co., 595 S.W.2d 591 (Tex.Civ.App.-Dallas 1980, no writ). There was testimony of the possibility of a capsulatomy but no testimony that such surgery would be reasonably probable. There is some evidence that in the future semi-annual check ups will be necessary which should cost $60 a year over the life expectancy of Appellee. The total probable cost of such semi-annual examinations plus the reasonable value of past medical treatment similar to that expected in the future is $6463. The jury finding on future medical expenses is excessive by $8537.
Appellee's burden is greater in proving loss of earnings than in proving diminished earning capacity. Bailey v. Merrill, 582 S.W.2d 489 (Tex.Civ.App.-Beaumont 1979, writ ref'd n. r. e.). Proof of loss *294 of earnings requires evidence of the plaintiff's actual earnings prior to his injury and his earnings or possible earnings following it. Stoner v. Hudgins, 568 S.W.2d 898 (Tex. Civ.App.-Ft. Worth 1978, writ ref'd n. r. e.). Appellee was in the hospital four nights following his injury and missed an additional two weeks of work. At the time of the accident Appellee was employed as a patrolman by the Fort Bend County Sheriff's department at approximately $860 a month. In addition, Appellee testified that he received an average of $100 per month for extra duty jobs prior to the accident. Following the accident Appellee was unable to work extra duty for approximately ten months. Sometime after his return to regular duty as a patrolman, Appellee left the Sheriff's Department and began working for the Jersey Village Police Department, earning about $1018 per month. He remained there approximately fifteen months. Thereafter he worked for Diamond Shamrock earning about $10.41 an hour which was presumably more than what he earned while employed by the City of Rosenberg. The finding of the jury that the lost earnings of Appellee were $6000 is excessive by $4240.
We find ample evidence to support the jury findings of impaired future earning capacity, past and future physical pain and mental anguish, and past and future physical impairment. Appellants' Points of Error numbers 4, 5, 6, 7, 8 and 9 are, therefore, overruled.
Appellants' second point of error, that there was no evidence to support the submission of the special issue on future medical expenses, is also overruled. As discussed previously, there was evidence that Appellee would require semi-annual examinations of his eyes for the remainder of his life, as well as followup lens care. There was also evidence of the reasonable value of such treatment. Considering only that evidence favorable to Appellee, we find more than a scintilla of evidence to support the submission of this special issue.
Having dealt with each element of damage individually, we find no need to consider the tenth point of error in detail. The judgment as a whole, as modified, is not excessive when the serious, permanent injury to the Appellee is considered. We note further that we are concerned with the final judgment entered by the court on June 24, 1980, rather than the second corrected judgment of which Appellants complain. Several judgments were entered by the trial court. The judgment dated June 24 makes a "judicial" change in the Second Corrected Judgment dated June 16. Therefore, even though the June 24 judgment does not expressly vacate the previous judgment of the court, it must be held to have such effect since it was signed while the court had jurisdiction in this cause. It is, therefore, the final judgment of the court. Swanson v. Holt, 126 Tex. 383, 87 S.W.2d 1090 (Tex.Comm.App.1935); Federal Underwriters Exchange v. Bailey, 175 S.W.2d 618 (Tex.Civ.App.-Dallas 1943, writ ref'd w. o. m.).
We calculate the proper amount of damages to be $96,446. Accordingly Appellee is given fifteen days from the date of this judgment to file a remittitur of $18,054. The respective liabilities of Appellants under the judgment as modified and affirmed shall be in the same proportion as their respective liabilities under the judgment of June 24. If Appellee should file the remittitur within that period the judgment of June 24 will be affirmed as modified; otherwise, the judgment will be reversed and the case remanded for new trial pursuant to Tex.R.Civ.P. 440.
ON FILING OF REMITTITUR
On March 25, 1981, we stated by opinion that if Appellee Bernard S. Renken, Jr. would file a remittitur of $18,054 within fifteen days, the judgment of the trial court would be modified and affirmed as modified; and that otherwise the judgment of the trial court would be reversed and the cause remanded. An error was made in calculating the amount of the suggested remittitur. The actual amount of the remittitur *295 to be filed should have been $13,054. Appellee has filed the suggested remittitur. The remittitur is accepted only to the extent of $13,054.
Accordingly, as of this date the judgment of the trial court is modified by deducting $13,054 from the judgment recovered by Appellee. The respective liabilities of Appellants under the judgment as modified shall be in the same proportion as their respective liabilities under the judgment of June 24. The judgment of the court below is affirmed as modified. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1671321/ | 705 S.W.2d 193 (1985)
J.C. KINLEY CO., et al., Appellants,
v.
HAYNIE WIRE LINE SERVICE, INC., et al., Appellees.
No. 01-85-0364-CV.
Court of Appeals of Texas, Houston (1st Dist.).
November 27, 1985.
Rehearing Denied February 6, 1986.
*194 B.R. Pravel, Steve Rosenblatt, Pravel, Gambrell, Hewitt & Kimball, Freeman Bullock, Houston, for appellants.
Jeffrey W. Tayon, Gregory L. Maag, Butler, Binion, Rice, Cook & Knapp, Houston, for appellees.
Before SAM BASS, WARREN and DUNN, JJ.
OPINION
SAM BASS, Justice.
This is an appeal from a summary judgment in favor of appellees.
We affirm.
In 1947, appellants, J.K. Kinley Co., et al. ("Kinley") obtained U.S. Patent 2,426,106 for an oil well perforating gun and later obtained U.S. Patents 2,540,122 and 2,544,601 for improvements on the 1947 patent.
In 1957, appellees, Haynie Wire Line Service, Inc., et al. ("Haynie") entered into a nonexclusive, nontransferable license to use the inventions of Kinley relating to oil field perforating guns, equipment, and parts under the patents listed above. The license provided:
"... that Licensee does not have the right to manufacture or sell, or have manufactured or sold, the devices of said inventions, or parts thereof...."
There is no reference in the agreement regarding any confidential or secret device, information, or part, or of any duty of confidentiality on the part of Haynie. The contract expressly contemplated that Haynie would disassemble, inspect, and replace certain expendable parts in the normal operation of the tools.
As a licensee, Haynie provided perforating services using perforator guns leased from Kinley under the license. Haynie had previously been engaged in the oil well perforation business, and had bought, manufactured, and used perforating tools in its business. Haynie resumed work, perforating oil wells with its own equipment after the agreement was terminated.
The licensor-licensee relationship existed until March 1965, when U.S. Patent 2,426,106 expired, and the agreement was terminated by Haynie pursuant to its terms. The termination, requiring Haynie to return all perforating guns to Kinley, fostered a dispute, which was settled in January 1966. The dispute concerned Haynie's manufacture of certain replacement parts of the leased tools and the return of a perforator that had been lost in an oil well. The settlement agreement cautioned Haynie against infringement of the patents, which had not yet expired, but made no mention of any confidential relationship or duty still existing or to exist in the future between the parties under the 1957 agreement.
*195 After the settlement, Haynie manufactured a perforator for its own use in 1967, and since 1975, has manufactured and sold approximately 10 perforators. At some point in time, Kinley discovered such manufacturing and sales activity and eventually arranged a sale of a gun by Haynie to a third party, Marine Brokers, Inc. in 1982. Kinley inspected the gun and determined that it incorporated many of the "confidential" features and parts that were in the perforator guns and parts leased to Haynie under the 1957 license. Kinley claims that the features and parts were neither disclosed in Kinley's issued patents nor in the art known to Haynie, but were derived from unpublished confidential information in drawings, instruction booklets, and other documents delivered to Haynie. Kinley brought suit in 1982 alleging breach of a confidential relationship.
Haynie filed two motions for summary judgment. The first motion challenged the existence of any confidential relationship between the parties either by contract or operation of law and asserted that the evidence shows, as a matter of law, that Kinley did not possess any trade secrets that could have been appropriated by Haynie. The second motion alleged that the actions for breach of confidential relationship or breach of contract, or both, were barred by the statutes of limitations.
The district court found as a matter of law that Kinley's cause of action was barred by the statutes of limitations. In March 1985, the cause was again reconsidered, and both motions for summary judgment were granted.
Kinley seeks reversal in its first and fourth points of error on the grounds that fact issues preclude an award of summary judgment on the basis that no confidential relationship existed either by contract or by operation of law, and that Haynie's cause of action is barred by the statute of limitations.
The question on appeal, as well as in the trial court, is not whether the summary judgment proof raises fact issues with reference to the essential elements of the claim or cause of action, but whether the summary judgment proof establishes as a matter of law that there is no genuine issue of fact as to one or more of the essential elements of the plaintiff's cause of action. Gibbs v. General Motors Corp., 450 S.W.2d 827, 828 (Tex.1970).
The movant for summary judgment has the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. However, on appeal, in deciding whether or not there is a disputed material fact issue precluding summary judgment, evidence favorable to the nonmovant will be taken as true. Wilcox v. St. Mary's University, 531 S.W.2d 589, 592-93 (Tex.1975). Every reasonable inference must be indulged in favor of the nonmovant and any doubts resolved in its favor. Id.
"When summary judgment is sought on the basis that limitations have expired, it is the movant's burden to conclusively establish the bar of limitations. Where the nonmovant interposes a suspension statute, such as Article 5537, or pleads diligence in requesting issuance of citation, the limitation defense is not conclusively established until the movant meets his burden of negating the applicability of these issues." Zale Corp. v. Rosenbaum, 520 S.W.2d 889, 891 (Tex.1975) (Oram v. General American Oil Co., 513 S.W.2d 533, 534 (Tex. 1974)). However, if the plea of the nonmovant does not challenge the limitations defense, but is in the nature of confession and avoidance, then the nonmovant does have the burden of raising a fact issue with respect to his affirmative defense to limitations. See Nichols v. Smith, 507 S.W.2d 518, 520 (Tex.1974); "Moore" Burger, Inc. v. Phillips Petroleum Co., 492 S.W.2d 934, 936-937 (Tex.1972).
In measuring the summary judgment evidence, pleadings, even if sworn to, do not constitute summary judgment proof. City of Houston v. Clear Creek Basin Authority, 589 S.W.2d 671, 678 (Tex.1979). The requirements for affidavits are that the affidavit must show affirmatively that it is based on personal knowledge and that the *196 facts sought to be proved therein be "admissible in evidence" at a conventional trial. Brownlee v. Brownlee, 665 S.W.2d 111, 112 (Tex.1984); Tex.R.Civ.P. 166-A(e). Further, an affidavit must set forth facts, not conclusions, in order to raise an issue of fact. Brownlee, 665 S.W.2d at 112; Inwood Forest Community Improvement Association v. R.J.S. Development Co., 630 S.W.2d 751, 754 (Tex.App.Houston [1st Dist.] 1982, no writ). Deposition testimony may be given the same weight as any other summary judgment evidence, and if it meets the standard of summary judgment evidence (i.e., by being clear, positive, direct, otherwise free from contradictions and inconsistencies, and, if untrue, could be readily controverted), it will uphold a summary judgment. Wiley v. City of Lubbock, 626 S.W.2d 916, 918 (Tex.App.Amarillo 1981, no writ); Tex.R.Civ.P. 166-A(c). If conflicting inferences may be drawn from statements made by the same party (e.g., one in an affidavit and the other in a deposition), a fact issue is presented. Gaines v. Hamman, 163 Tex. 618, 358 S.W.2d 557, 562-63 (Tex.1962). Finally, when the summary judgment record is incomplete, any omitted documents are presumed to establish the correctness of the judgment. DeBell v. Texas General Realty, Inc., 609 S.W.2d 892, 893 (Tex.Civ.App.Houston [14th Dist.] 1980, no writ); See also Foster v. Hubbard Independent School District, 619 S.W.2d 607, 609 (Tex.Civ.App.Waco 1981, writ ref'd n.r.e.).
Haynie contends that Kinley's action is barred by stare decisis, and cites Luccous v. J.C. Kinley Co., 376 S.W.2d 336 (Tex. 1964). There, Kinley entered into a written license agreement whereby it granted Luccous a license, similar to the one at bar, to use Kinley's patented sand-line cutters. Kinley alleged that subsequent to the expiration of the patent and licensing agreement, Luccous continued to use and rent cutters that it had manufactured based on the information secured from Kinley under the licensing agreement. The Texas Supreme Court denied Kinley injunctive relief, concluding that it was evident that the trade secrets involved covered the same subject matter as the patent grant. The court emphasized that it had specifically not been held in Hyde Corp. v. Huffines, 158 Tex. 566, 314 S.W.2d 763 (1958), that "the trade secret itself survived the complete disclosure in the patent grant." Luccous, 376 S.W.2d at 339.
Kinley claims, however, that the instant suit is not barred because it is based on the transmission of unpublished confidential information in the context of a licensor-licensee relationship. Such information is allegedly beyond that disclosed in issued patents that are, admittedly, public knowledge and not protected as trade secrets.
In determining whether a confidential relationship exists, this Court must examine the entire record. Hyde Corp. v. Huffines, 158 Tex. at 587, 314 S.W.2d at 777. A duty of confidentiality is not implied, as a matter of law, from the licensor-licensee relationship between the parties. Id. "Although an express contractual provision is not required to establish a duty of confidentiality, the absence of an agreement restricting disclosure of information is a factor the court may consider." Daily International Sales Corp. v. Eastman Whipstock, Inc., 662 S.W.2d 60, 63 (Tex. App.Houston [1st Dist.] 1983, no writ). Other factors include the nature and extent of security precautions taken by the possessor of the trade secret to keep the information from the general public, and the degree to which the information has been placed in the public domain by voluntary disclosure. Rimes v. Club Corp. of America, 542 S.W.2d 909, 913-14 (Tex.Civ.App. Dallas 1976, writ ref'd n.r.e.); Furr's Inc. v. United Specialty Advertising Co., 385 S.W.2d 456, 459 (Tex.Civ.App.El Paso 1964, writ ref'd n.r.e.), cert. denied, 382 U.S. 824, 86 S. Ct. 59, 15 L. Ed. 2d 71 (1965); Lamons Metal Gasket Co. v. Traylor, 361 S.W.2d 211, 212-13 (Tex.Civ.App. Houston 1962, writ ref'd n.r.e.).
The present case is distinguishable from Hyde Corp. v. Huffines, and also from K & G Oil Tool & Service Co. v. G & G Fishing Tool Service, 158 Tex. 594, 314 S.W.2d 782 *197 (Tex.1958), because in those cases, the defendants had acquired knowledge from a confidential relationship that existed before the issuance of the patents. The licensing agreement in Hyde provided for the manufacture and sale of the invention with royalties paid to the inventor. Liability was not predicated on the existence of a mere lease of equipment alone. Following the reasoning in Hyde, a confidential relationship has been found to arise when the parties were not simply licensor and licensee, they were also joint venturers. Crutcher-Rolfs-Cummings, Inc. v. Ballard, 540 S.W.2d 380, 387 (Tex.Civ.App. Corpus Christi 1976, writ ref'd n.r.e.), cert. denied, 433 U.S. 910, 97 S. Ct. 2978, 53 L. Ed. 2d 1095 (1977).
Our facts are that Haynie did not approach Kinley seeking access to new technology for a new business. Haynie had been perforating oil wells with similar equipment since 1949 and continued to do so even after the licensing agreement and patent expired. Also, there is no evidence that Kinley and Haynie ever operated as joint venturers.
In K & G Oil Tool, 314 S.W.2d at 785-86, the licensing agreement contained a specific provision prohibiting disassembly of the tool in dispute, which both parties understood was intended to prevent anyone from determining the internal construction of the tool. Such a provision is absent from the agreement in the present case. It expressly contemplates that Haynie would disassemble, inspect, replace, and manufacture certain expendable parts in the normal operation of the tools. Also absent was any requirement that the work be performed in private beyond the view of other oil field technicians. In accord with this understanding was the provision that any improvements made on the perforator by Haynie were to be Haynie's property.
The undisputed evidence shows that Haynie frequently disassembled, inspected, repaired, and manufactured parts of the leased perforator in the presence of others not in its employ. Kinley also admits that it sold one perforator in France that was later recovered, but there was no evidence that any copying had occurred. Despite the allowance by Kinley of the dissemination of information about the tool, Kinley claims that the transmittal of manuals, instruction booklets, and drawings allegedly furnished to Haynie, in itself created a confidential relationship as a matter of law. Said publications (some with the notation "confidential") allegedly revealed information about internal components and the operation of the perforator not disclosed in the Kinley patents.
Kinley claims in its affidavit that Haynie received the aforementioned drawings and instruction booklets in Haynie's capacity as a licensee, and that the material was treated as highly confidential by all Kinley licensees. Kinley's exhibits include a confidential catalog and correspondence sent to another licensee, and a field manual sent to Haynie's brother in Louisiana. There is no relevant correspondence from Kinley to Haynie. Haynie denies, both in its affidavit and deposition, that it was ever informed either orally or in writing that any information was confidential, that there was any duty of confidentiality, or that it was required to disassemble, inspect, or repair the tool in private. Haynie further testified that it never received the aforementioned booklets, manuals, and drawings allegedly furnished to it by Kinley. Haynie only stipulated that one drawing of the tool, which drawing was produced from its files, originally came from Kinley, but it did not know when or how it was obtained.
The summary judgment evidence indicates the failure of Kinley to take affirmative steps to maintain the secrecy of its alleged trade secrets. Kinley does not controvert Haynie's testimony by showing how Haynie was informed, by whom and when it was informed, or when and under what terms Haynie agreed to keep the information in confidence. Kinley's statement about Haynie's knowledge of confidentiality or its receipt of the confidential information is a mere subjective conclusion with no supporting facts, and therefore, does not *198 constitute competent summary judgment evidence.
"It is self-evident that the subject matter of a trade secret must be secret." Luccous v. J.C. Kinley Co., 376 S.W.2d at 338. Here, there was undisputed evidence showing a total lack of any precautions taken by Kinley to maintain the secrecy of the internal parts of the leased tools, and there were no contractual provisions establishing a duty of confidentiality. Therefore, the trial court did not err in concluding, as a matter of law, that no confidential relationship existed between the parties.
Having found that no confidential relationship existed between the parties, we further find that the trial court was correct in holding that appellants' cause of action is barred by the applicable statute of limitations, as suit was not brought within two years of the occurrence of the first breach. Tex.Rev.Civ.Stat.Ann. art. 5526 (Vernon Supp.1985).
Under Texas law, fraudulent concealment is an affirmative defense to an assertion that the statute of limitations has run. Timberlake v. A.H. Robins Co. Inc., 727 F.2d 1363, 1366 (5th Cir.1984). The plaintiff must prove that the defendant had actual knowledge of the facts allegedly concealed and a fixed purpose to conceal the wrong. Mere concealment does not constitute fraudulent concealment for purposes of tolling the statute of limitations; rather, the plaintiff is under a duty to exercise reasonable diligence to discover its cause of action. Id.
Kinley does not dispute that Haynie began manufacturing and selling perforators to third parties as early as 1975, but maintains said sales were undisclosed and unadvertised. Haynie testified in its deposition that it chose not to advertise because "the whole oilfield" knew about its activity. Nevertheless, Kinley argues that Haynie has failed to present any evidence that would have put Kinley on notice of Haynie's actions "at any particular point in time."
Ordinarily, one's ignorance of one's cause of action will not prevent the statute from running. Houston Water-Works Co. v. Kennedy, 70 Tex. 233, 236, 8 S.W. 36 (1888); State v. Jones, 315 S.W.2d 435, 438 (Tex.Civ.App.Dallas 1958, writ ref'd n.r. e.). "The primary purpose of limitations, to prevent litigation of stale or fraudulent claims," must also be kept in mind. Robinson v. Weaver, 550 S.W.2d 18, 20 (Tex. 1977).
Kinley has failed to establish fraudulent concealment on the part of Haynie. Uncontroverted evidence in the record further indicates Kinley's failure to use reasonable diligence in pursuing its alleged cause of action. A previously settled dispute in 1966 concerning the manufacture of replacement parts and the return of certain lost parts by Haynie created a red flag for Kinley. There is nothing in the record to explain why Kinley waited so long to investigate its previous licensee, a local competitor in a highly specialized field.
Haynie is entitled to prevail upon its motion for summary judgment after establishing the applicability of the statutes of limitations, absent proof from Kinley showing some excuse for delay. McClelland v. Peterson, 494 S.W.2d 583 (Tex.Civ.App. Houston [1st Dist.] 1973, no writ).
Kinley's first and fourth points of error are overruled. Kinley's second and third points of error are also overruled.
The judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1691527/ | 706 So. 2d 999 (1997)
BLUE, WILLIAMS & BUCKLEY, A Law Partnership
v.
BRIAN INVESTMENTS, LTD. and Sam J. Recile.
No. 96 CA 1451.
Court of Appeal of Louisiana, First Circuit.
June 20, 1997.
Rehearing Denied July 24, 1997.
Writ Denied November 21, 1997.
*1000 Mark Landry, Metairie, for Plaintiff/Appellant Blue, William & Buckley, A Law Partnership.
Patrick F. McGrew, Baton Rouge, for Defendant/Appellee Brian Investments, Ltd., et al.
Louis Guillot, New Iberia, for Defendant/Appellee Brian Investments, Ltd., et al.
Sam J. Recile, Jr., Scotlandville, in proper person.
Before CARTER, LeBLANC and PARRO, JJ.
LeBLANC, Judge.
This action was commenced by Blue, Williams & Buckley (Blue), a law partnership, against Brian Investments, Ltd. (Brian), and Sam J. Recile (Recile), to recover on an open account and a promissory note for legal services rendered.
FACTS AND PROCEDURAL HISTORY
Suit was originally filed by Blue against Brian and Recile on February 3, 1993, and service was directed to both defendants.[1] On March 15, 1993, a motion for preliminary default was entered against Brian and Recile. Prior to the confirmation of the default judgment, Sam J. Recile, Jr.[2], holding himself out as president of Brian, filed an answer and a peremptory exception raising the objection of prescription. Thereafter, on May 18, 1993, the default judgment was confirmed as to Recile. That judgment is final and definitive.
On May 27, 1993, Blue filed a motion to strike the exception and the answer, filed by Sam J. Recile, Jr. contending, he was not licensed to practice law and, as of the filing date of those pleadings, was not the president of Brian. Judgment granting the motion to strike the exception and answer was signed September 9, 1993. The record indicates notice of this judgment was sent to all parties on September 9, 1993.
On October 1, 1993, a motion for preliminary default was entered against Brian. On November 9, 1993, the default judgment was confirmed. On September 15, 1994, Brian, now appearing through counsel, filed a motion for new trial and a petition for nullity of judgment.[3] In its motion for new trial, *1001 Brian contended the September 9, 1993 judgment was improper because Sam J. Recile Jr. never received notice of this judgment. In its petition for nullity of judgment, Brian alleged 1) the judgment of September 9, 1993, granting the motion to strike, should be annulled due to improper service and 2) the judgment of November 9, 1993, should be annulled because it was obtained by fraud and or ill practices, since no notice was given to Sam J. Recile, Jr. On November 15, 1994, Blue filed an answer to Brian's petition for nullity. On March 2, 1995, the lower court denied Brian's motion for new trial as untimely and annulled, vacated and set aside the November 9, 1993 default judgment against Brian.
Subsequently, Blue filed a motion for new trial, averring it was improper for the court to render judgment in an ordinary proceeding which had not been set for hearing and in due course, trial. On October 4, 1995, the court granted Blue's motion for new trial and set aside and recalled the March 2, 1995 judgment only insofar as it purported to nullify the judgment of November 9, 1993, with regards to Brian.
Blue then filed a motion for judgment on the pleadings or in the alternative, a motion for summary judgment. In this motion, Blue alleged Brian's petition disclosed no ground for relief, or in the alternative, there existed no genuine issue of material fact. In response, Brian filed a cross motion for summary judgment, alleging there were no genuine issues of material fact and it was entitled to summary judgment as a matter of law.[4] On January 25, 1996, Blue's motion for summary judgment was denied, Brian's motion for summary judgment was granted and the November 9, 1993 default judgment against Brian was annulled, vacated and set aside. Notice of the signing of judgment was mailed January 26, 1996.
Blue filed a motion and order for suspensive appeal on February 5, 1996. Brian opposed the motion for suspensive appeal, contending Blue had no right to a suspensive appeal. The court, thereafter, ordered briefs and took the matter under advisement. Subsequently, in order to preserve its appeal, Blue filed an application for supervisory relief asking this court to order the trial judge to sign the order of appeal and fix the amount of the bond. On May 15, 1996, the trial judge signed the order of appeal and fixed the bond at $100,000.[5] Blue filed its suspensive appeal bond on June 6, 1996. On June 12, 1996 Brian filed a "motion to dismiss and request for a stay." On August 12, 1996, this court referred the motion to dismiss to the merits and denied the stay. See Prevost v. Jobbers Oil Transport Company, 95 0224, p. 6 n. 3 (La.App. 1st Cir. 10/6/95); 665 So. 2d 400, 405 n. 3, writ denied, 96-0440 (La 4/8/96); 671 So. 2d 336.
MOTION TO DISMISS
In its motion to dismiss, Brian contends Blue's suspensive appeal should be dismissed for failure to furnish security within the delay allowed under La.C.C.P. art. 2123 and in the alternative, the judgment of January 25, 1996, is interlocutory in nature and not subject to a direct appeal.[6]
La.C.C.P. art. 2123 provides:
A. Except as otherwise provided by law, an appeal that suspends the effect or the execution of an appealable order or judgment may be taken, and the security therefor furnished, only within thirty days of any of the following:
*1002 (1) The expiration of the delay for applying for a new trial or judgment notwithstanding the verdict, as provided by Article 1974 and Article 1811, if no application has been filed timely.
(2) The date of the mailing of notice of the court's refusal to grant a timely application for a new trial or judgment notwithstanding the verdict, as provided under Article 1914.
In a suspensive appeal the appellant must file both the petition for appeal and furnish the security within the delay allowed in La.C.C.P. art. 2123. When the appellant fails to timely furnish the security required for a suspensive appeal, the right vests in the appellee to obtain dismissal of the suspensive appeal and to secure the right to execute on the judgment. However, the suspensive appeal is not invalid merely because the appellant does not furnish security until after the delay has elapsed. The appellant's tardiness in furnishing security merely constitutes an irregularity or defect which, if imputable to the appellant, may form a basis for the appellee to move for dismissal of the suspensive appeal under La.C.C.P. art. 2161. Wright v. Jefferson Roofing, Inc., 93-1217, p. 4 (La.1/14/94); 630 So. 2d 773, 775.
However, when the motion for appeal has been made timely within the delay period allowed to perfect an appeal and has been continuously pressed, the appeal as ultimately perfected has been held valid despite the tardy filing of the bond, where the failure to perfect it within the delay period results from the erroneous refusal of the trial court to sign an appeal order timely after it has been presented to it, or from the trial court's placing unreasonable conditions upon the exercise of the right to appeal. The fault in the tardy filing is then regarded as imputable to the court system rather than to the appellant. La. C.C.P. art. 2161; Graves v. Kaiser Aluminum & Chemical Corp., 319 So. 2d 323, 325 (La.1975) (where the foregoing was applied to a case involving a devolutive appeal), when such an appeal required a bond.
In the case at bar, Blue timely filed its motion and order for suspensive appeal on February 5, 1996. Brian opposed the motion and the court ordered briefs and took the matter under advisement. In order to preserve its appeal, Blue filed an application for supervisory relief asking this court to order the trial judge to sign the order of appeal and fix the amount of the bond. On May 15, 1996, the trial judge signed the order of appeal and fixed bond. Subsequently, Blue filed its suspensive appeal bond on June 6, 1996. Because Blue timely filed its motion and order for appeal and continuously pressed to have its order for appeal signed and bond fixed, including taking a writ to this court, it did everything within its power to perfect its suspensive appeal. Thus, the failure to provide security within the delay period is imputable to the court system rather than to Blue. Accordingly, Brian's motion to dismiss Blue's suspensive appeal is denied.
SUMMARY JUDGMENT
Appellate courts are to review summary judgments de novo under the same criteria that govern the district court's consideration of whether summary judgment is appropriate. Potter v. First Federal Savings and Loan Association of Scotlandville, 615 So. 2d 318, 325 (La.1993); Madden v. Bourgeois, 95-2354, p. 3 (La. App 1st Cir. 6/28/96); 676 So. 2d 790, 792. At the time this suit was filed, Louisiana law discouraged summary judgments. However, by Acts 1996, First Extraordinary Session, No. 9, the legislature amended La.C.C.P. art. 966, stating in pertinent part in paragraph A(2) that:
The 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.
Since the amended version of La.C.C.P. art. 966 is a procedural change, we should retroactively apply it to this case. La.C.C. art. 6; Short v. Giffin, 96-0361, p. 5-6 (La.App. 4th Cir. 8/21/96); 682 So. 2d 249, 253; writ denied, 96-3063 (La.3/7/97); 689 So. 2d 1372; NAB Natural Resources, L.L.C. v. Willamette Industries, Inc., 28,555, p. 3 (La.App.2d Cir. 8/21/96); 679 So. 2d 477, 479.
Though article 966 now encourages summary judgments, it does not change the burden of proof required for summary judgment *1003 proceedings. The burden of proof remains on the mover to show, through affidavits based on personal knowledge, depositions, or answers to interrogatories, "that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law." La.C.C.P. arts. 966 B and G, 967. Short, 96-0361 at p. 6; 682 So.2d at 253.
Material facts are those that potentially insure or preclude recovery, affect the litigant's ultimate success, or determine the outcome of a legal dispute. Penalber v. Blount, 550 So. 2d 577, 583 (La.1989). Because it is the applicable substantive law that determines materiality, whether or not a particular fact in dispute is material can be seen only in light of the substantive law applicable to the case. Sun Belt Constructors v. T & R Dragline Service, Inc., 527 So. 2d 350, 352 (La.App. 5th Cir.1988).
On appeal, Blue contends the trial court erred when it granted Brian's motion for summary judgment, denied Blue's motion for summary judgment and granted judgment nullifying the default judgment against Brian. Brian argues in brief that Blue's appeal should fail because service was not proper upon Brian and the record does not contain the required proof of service mandated by La.C.C.P. art. 1235.1. Brian further argues, without proper service on Brian, the jurisdiction of the trial court did not attach and all proceedings that followed, inclusive of the default judgment of November 9, 1993, are absolutely null.
Citation and service thereof are essential in all civil actions except summary and executory proceedings and divorce actions under Civil Code Article 102. Without them all proceedings are absolutely null. La.C.C.P. art. 1201. The citation must be signed by the clerk of the court issuing it with an expression of his official capacity and under the seal of his office. The citation must be accompanied by a certified copy of the petition, and must contain the date of issuance, the title of the cause, the name of the person to whom it is addressed, the title and location of the court issuing it, and a statement that the person cited must either comply with the demand contained in the petition or make an appearance, either by filing a pleading or otherwise, in the court issuing the citation within fifteen days under penalty of default. La.C.C.P. art. 1202. Service of citation or other process may be either personal or domiciliary. La.C.C.P. art. 1231. Personal service is made when a proper officer tenders the citation or other process to the person to be served. La.C.C.P. art. 1232. Personal service may be made anywhere the officer making the service may lawfully go to reach the person to be served. La.C.C.P. art. 1233. Service is made on a person who is incarcerated in a jail or detention facility through personal service on the warden or his designee for that shift. The warden or his designee shall in turn make personal service on the person incarcerated. Proof of service shall be made by filing in the record the affidavit of the person serving the citation and pleadings on the person who is incarcerated. La.C.C.P. art. 1235.1. An additional method of service on an incarcerated person is found in La. R.S. 13:3471(6), which provides that service of process on an inmate of a public institution may be made by the sheriff of the parish where the institution is located.
Service of citation or other process on a domestic or foreign corporation is made by personal service on any one of its agents for service of process. La.C.C.P. art. 1261. Under La.C.C.P. art. 1261(A), failure to personally serve the registered agent for a corporation renders the service null and void and of no effect. See Conner v. Continental Southern Lines, Inc., 294 So. 2d 485, 487 (La.1974). Nevertheless, if there are two statutes that touch on the same subject matter, a fair and reasonable interpretation should be used to reconcile the two. See Fakier v. Picou, 246 La. 639, 649, 166 So. 2d 257, 260 (La.1964).
In the case sub judice, the record reveals that the citation was issued by the clerk of court for East Baton Rouge Parish, on February 9, 1993. The return of citation indicates that Recile, as the corporation's registered agent, received personal service of the citation on February 11, 1993. The return shows Recile was personally served by a deputy sheriff of the East Baton Rouge Parish *1004 sheriff's office. See La. C.C.P. art. 324. A return of citation is prima facie evidence of service. La.C.C.P. art. 1292. The return of the officer on the citation is given great weight, and the burden rests on the party attacking it to establish otherwise by clear and convincing evidence. Billiot Brothers, Inc. v. Bercier, 447 So. 2d 1090, 1091 (La.App. 1st Cir.1983).
Brian argues that because the record is void of an affidavit of the person serving the citation and pleadings as required by La.C.C.P. art. 1235.1, service was improper and any proceedings thereafter were null for want of jurisdiction. We do not agree. The article relied on by Brian appears in Chapter 2 of Title II of Book II of the Code of Civil Procedure. The title of that chapter is, "Service on Persons." The law for serving corporations is found in Chapter 3 of Title II, "Service on Legal and Quasi Legal Entities." Service of citation on incarcerated persons, as well as service of citation on a domestic or foreign corporation, must be personal. Brian, through its registered agent, Recile, was personally served and the return of citation bearing the signature of the deputy sheriff who personally served Recile, is in the record before us. Under La.C.C.P. art. 1235.1, proof of service by affidavit of the person serving the citation and pleadings on the person incarcerated is necessary because the warden or his designee is personally served and then he, in turn, makes personal service on the incarcerated person. However, in this case, an affidavit is not necessary because a deputy sheriff personally served Brian's registered agent for service of process and attested to this on the return of citation. There was no intervening service on a warden, because none was needed to make direct personal service on an inmate in the East Baton Rouge Parish Prison. Service was proper under La. R.S. 13:3471(6), as well as La. C.C.P. art. 1261. Thus, we find Brian has failed to carry its burden of proof by clear and convincing evidence that service of the petition and its citation was improper.
In its petition for nullity of judgment, Brian alleged 1) the judgment of September 9, 1993, granting the motion to strike should be annulled because Sam J. Recile, Jr. never received notice of the hearing on the motion and, as a result, judgment was rendered against Brian and 2) the default judgment of November 9, 1993, should be annulled because it was obtained by fraud and or ill practices, since no notice was given to Sam J. Recile, Jr.
The record before us reveals that Brian, through Recile, its registered agent for service of process, was again personally served in the East Baton Rouge Parish Prison, with certified copies of the motion to strike the answer and the exception on June 14, 1993. The return indicated an appearance was required on August 20, 1993, at 9:30 a.m., to show cause why the exception and answer filed and signed by Sam J. Recile, Jr. should not be stricken from the record. At the hearing on August 20, 1993, Brian was absent and unrepresented. At this time, the court ordered Brian to file responsive pleadings, signed by an attorney admitted to practice law, within 10 days of the date of the judgment, or a default judgment might be entered against it. Judgment granting the motion to strike the exception and answer was signed September 9, 1993. The record indicates notice of this judgment was also sent to all parties on September 9, 1993. Because Sam J. Recile, Jr. was not Brian's registered agent for service at this time, not a party to the lawsuit, and not an attorney admitted to practice law in Louisiana, he was not entitled to notice and service of the motion to strike the September 9, 1993 judgment thereon, or notice of the preliminary default entered against Brian which gave rise to the default judgment of November 9, 1993.
Based on the record before us and the circumstances of the present case, we find as a matter of law, that service of process was proper upon Brian, through Recile, its registered agent; jurisdiction attached to all subsequent proceedings and the default judgment of November 9, 1993, against Brian was valid. Accordingly, we conclude that the trial court erred 1) in granting Brian's motion for summary judgment, 2) in denying Blue's motion for summary judgment, and 3) in annulling, vacating and setting aside the default *1005 judgment of November 9, 1993, against Brian.
DECREE
For the above reasons, the January 25, 1996 judgment of the trial court granting Brian's motion for summary judgment, denying Blue's motion for summary judgment and annulling, vacating and setting aside the default judgment of November 9, 1993, against Brian, is reversed. Judgment is rendered granting Blue's motion for summary judgment. The default judgment of November 9, 1993, against Brian is reinstated. Brian is cast for the costs of this appeal.
REVERSED AND RENDERED.
NOTES
[1] Service was directed to Sam J. Recile as a defendant, as well as, the registered agent for Brian.
[2] The record before this court contains a document titled "Answer to Petition and Suit for Profession [sic] Fees, Money Lent on Open Account and on Promissory Note" purportedly filed by Sam J. Recile, II. However, in the opening paragraph of this document, Sam J. Recile, II refers to himself as Sam J. Recile, Jr. The court will also refer to him as Sam J. Recile, Jr.
[3] On September 9, 1994, Sam J. Recile, Jr. filed papers with the Secretary of State which reflected that he had become the president of the corporation and its registered agent.
[4] Although counsel for Brian stated it was opposed to Blue's motion for judgment on the pleadings and in the alternative, motion for summary judgment "for reasons more fully set forth in the memorandum filed herewith," the record is devoid of such a memorandum.
[5] On May 31, 1996, this court dismissed Blue's writ application as moot.
[6] We reject Brian's argument regarding the interlocutory nature of the January 25, 1996 judgment. The judgment of January 25, 1996, granting Brian's motion for summary judgment is a final judgment and has the same effect as if there had been a trial on the merits. La.C.C.P. art. 968. Cleveland v. Theriot-Modec Enterprises, Inc., 469 So. 2d 1215 (La.App. 1st Cir.1985), writ denied, 475 So. 2d 360 (1985). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1811409/ | 192 B.R. 877 (1996)
In re Ali M. SAMANI, Shahla R. Samani, Debtors.
AT & T UNIVERSAL CARD SERVICES, Plaintiff,
v.
Ali M. SAMANI, Shahla R. Samani, Defendants.
Bankruptcy No. 94-47238-H5-7. Adversary No. 95-4058.
United States Bankruptcy Court, S.D. Texas, Houston Division.
March 4, 1996.
*878 Richard L. Abrams, Houston, TX, for Plaintiff.
J. Robert Harris, Houston, TX, for Defendants.
MEMORANDUM OPINION
KAREN KENNEDY BROWN, Bankruptcy Judge.
Before the Court is AT & T Universal Card Services' complaint to determine dischargeability of debt in the amount of $6,783.13 against defendants Ali M. and Shahla R. Samani based on 11 U.S.C. §§ 523(a)(2)(A) and 523(a)(2)(B). The Court has jurisdiction of this complaint pursuant to 28 U.S.C. §§ 157(a), (b)(1), (b)(2)(I), 1334(b) and 11 U.S.C. § 523(c). This is a core proceeding.
I. Findings of Fact
Ali M. Samani holds an AT & T Universal Card Services credit card. From May to *879 August 1994, debtors incurred numerous charges at department stores, toy stores, and sporting goods stores for clothing, perfume, and gifts for friends. Mrs. Samani also incurred numerous travel charges during this time. Debtors also took a $1,500 cash advance on the card to send cash to Mr. Samani's ill father in Iran and charged an Air France airplane ticket for Mrs. Samani's mother to travel to the United States. New charges incurred during this time total $3,181.80 plus finance charges. The Samanis last made a payment on this account of $65.00 in July 1994.
On October 26, 1994, the defendants filed their chapter 7 petition. According to defendants' bankruptcy schedules, the defendants have $39,781.00 in unsecured nonpriority debt, $37,046.00 of which is charge card debts. At the time of the filing, credit card minimum payments totaled $700-800 per month. The defendants have current monthly income of $2,927.00 and current combined monthly expenses of $2,529.00. The defendants' combined income was $51,060.00 in 1992, and $49,415.00 in 1993.
Mr. Samani testified that the charges on the account were incurred by his wife during a period of marital discord. The Court finds that as the sole card holder, Mr. Samani knowingly allowed his wife to use the card and to incur the charges as they were made. There was no change in employment prior to Mrs. Samani incurring these debts; there was no other change in personal circumstances which would suggest an improvement to the Samanis financial condition.
II. Conclusions of Law
AT & T asserts that this credit card debt is non-dischargeable pursuant to 11 U.S.C. § 523(a)(2)(A) and (B).[1]
Bankruptcy Code § 523(a)(2)(A) and (B) provide:
(a) A discharge under 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt
(2) for money, property, services, or an extension, renewal, or refinancing of credit, to the extent obtained by
(A) false pretenses, a false representation, or actual fraud, other than a statement respecting the debtor's or an insider's financial condition; . . .
(B) use of a statement in writing
(i) that is materially false;
(ii) respecting the debtor's or an insider's financial condition;
(iii) on which the creditor to whom the debtor is liable for such money, property, services, or credit reasonably relied; and
(iv) that the debtor caused to be made or published with intent to deceive; or. . . .
Proof of fraud requires a showing that (1) debtor obtained money by false representations; (2) debtor made the false representations with intent to deceive the creditor; and (3) the creditor relied on the false representation. In re Allison, 960 F.2d 481, 483 (5th Cir.1992). The Supreme Court in Field v. Mans, ___ U.S. ___, ___, 116 S. Ct. 437, 446, 133 L. Ed. 2d 351 (1995) recently found that Section 523(a)(2)(A) requires proof of only justifiable, not reasonable reliance as an element of actual fraud.
This Court previously in In re Hulbert, 150 B.R. 169 (Bankr.S.D.Tex.1993) found that the Fifth Circuit case of Davison-Paxon Co. v. Caldwell, 115 F.2d 189 (5th Cir.1940), cert. denied, 313 U.S. 564, 61 S. Ct. 841, 85 L. Ed. 1523 (1941), which held proof of an implied representation insufficient to prove fraud, remains binding precedent despite subsequent appellate language questioning its application to credit card transactions. See Sears, Roebuck & Co. v. Boydston (In re Boydston), 520 F.2d 1098, 1101 (5th Cir.1975). Creditors cannot establish fraud based on the implied representation of an intent to repay and ability to pay based on the mere use by the debtor of a credit card. Cases which allow this result directly contravene *880 Davison-Paxon and present troubling burden-shifting questions.
It has long been recognized, however, that fraud is rarely proven by direct evidence. See Drew Frackowiak, The Fallacy of Conflicting Theories for Analyzing Credit Card Fraud Under 11 USC Section 523(a)(2)(A), 4 J. Bankr.L. & Prac. 641, 652 (Sept. 1995). Instead, courts ordinarily consider an objective totality of the circumstances test to consider the circumstances of the alleged fraud. Frackowiak, at 653.
Consequently, the question for this court is whether the creditor has proven by a preponderance of the evidence the necessary elements of actual fraud by a totality of the circumstances. In evaluating intent, courts look to the length of time between the loan and the bankruptcy; changes in the buying habits of the debtor; the debtor's financial sophistication; debtor's employment status; whether the debtor consulted an attorney regarding filing bankruptcy before the charges were made; whether the purchases were for luxuries or necessities; and whether debtors were hopelessly insolvent at the time of the charges. See Hulbert, 150 B.R. at 173.
The Court finds that both Mr. and Mrs. Samani knew at the time the charges were incurred that debtors could not pay them, and the Court finds that there is no evidence that either Mr. or Mrs. Samani ever intended to repay the charges as they were incurred. Many of the items purchased were frivolous. The charges for the debtors' parents' benefit were made at a time when debtors knew they could never repay the debt and had no intentions of doing so. The amount of charges incurred far exceeded any prior months' charges and exceeded the debtors' ability to repay even the minimum monthly payment due.
The Court finds that by using their credit cards in the transactions at issue, the Samanis defrauded plaintiff. The Court finds this intent not to repay from the totality of the circumstances, including the debtors' incomes, the luxury nature of the items purchased, and the timing of the purchases in relation to the filing of bankruptcy. As noted, there was no change in debtor's employment or income at the time of the purchases which would indicate ability or intent to repay. Moreover, the Court finds that reliance by the creditor was justified based on debtors' prior sporadic payment of at least the minimum monthly amount due.
AT & T has incurred reasonable and necessary attorneys fees in the collection of this matter in the amount of $700.00. Attorneys fees for which a creditor has a contractual right under state law and which are incurred in connection with a nondischargeable debt are likewise nondischargeable. See In re Jordan, 927 F.2d 221, 227 (5th Cir. 1991), overruled on other grounds; In re Coston, 991 F.2d 257 (5th Cir.1993).
Based on the foregoing, it is
ORDERED that the debt of Ali and Shahla Samani to AT & T Universal Card Services in the amount of $3,181.80 and attorneys fees in the amount of $700.00 is not discharged. It is further
ORDERED that the parties shall submit a final judgment in accordance with this Memorandum Opinion.
NOTES
[1] AT & T asserts that the charges incurred are nondischargeable under 11 U.S.C. § 523(a)(2)(B), but the Court finds that plaintiff failed to prove nondischargeability under this section. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1562788/ | 758 S.W.2d 749 (1988)
Myrna COATES, Relator,
v.
The Honorable Mark WHITTINGTON, Judge, Respondent.
No. C-7314.
Supreme Court of Texas.
September 21, 1988.
Rehearing Denied November 16, 1988.
*750 Charles W. McGarry, Jennifer Judin and Richard N. Countiss, Law Offices of Windle Turley, Dallas, for relator.
Frank Finn and Judy C. Norris, Thompson & Knight, Dallas, for respondent.
SPEARS, Judge.
At issue in this mandamus proceeding is whether a plaintiff who claims mental anguish damages in a personal injury action may be required to submit to a mental examination. In the underlying case, relator Myrna Coates sued Drackett Products Company for injuries she sustained while using Drackett's oven cleaner. She claimed both physical and mental anguish damages, and Drackett alleged that Mrs. Coates had been contributorily negligent. Drackett moved for an order compelling Mrs. Coates to submit to a mental examination pursuant to Rule 167a of the Texas Rules of Civil Procedure. Judge Mark Whittington granted the motion and ordered Mrs. Coates to undergo the examination. The court of appeals denied Mrs. Coates' motion for leave to file petition for writ of mandamus. We hold that the trial court abused its discretion by ordering Mrs. Coates to submit to a mental examination. We therefore conditionally grant relator's petition for writ of mandamus.
Mrs. Coates was injured when she inadvertently sprayed her arm with Drackett's "Mr. Muscle Oven Cleaner" while cleaning her stove top. She suffered severe second degree burns and permanent scarring on her left forearm as a result of the incident. Mrs. Coates brought a products liability action against Drackett, seeking damages for pain and suffering, physical impairment, lost earnings, medical expenses, and mental anguish. In response, Drackett pleaded contributory negligence, misuse, and pre-existing condition. Drackett moved for an order compelling Mrs. Coates to submit to a mental examination pursuant to Rule 167a of the Texas Rules of Civil Procedure, claiming that her mental anguish was pre-existing and may have contributed to the incident with the oven cleaner. The trial judge denied the motion. Drackett then sought a rehearing of its motion, asserting that Mrs. Coates had placed her mental condition "in controversy" by pleading mental anguish damages. Drackett also claimed that there was "good cause" for the mental examination because Mrs. Coates alleged that she experienced "depression and general mental problems at the time she used the oven cleaner." Judge Whittington granted Drackett's motion and ordered that Mrs. Coates submit to a mental examination by a court appointed psychologist. Judge Whittington ordered that the examination address: (1) the relationship of Mrs. Coates' prior problems to the occurrence made the basis of the suit, if any; and (2) the relationship of Mrs. Coates' prior problems to the prayer for mental anguish damages, if any. The court of appeals denied Mrs. Coates' motion for leave to file petition for writ of mandamus.
Rule 167a of the Texas Rules of Civil Procedure provides in pertinent part:
When the mental ... condition ... of a party ... is in controversy, the court in which the action is pending may order the party to submit to a ... mental examination by a physician.... The order may be made only on motion for good cause shown and upon notice to the person to be examined and to all parties and shall specify the time, place, manner, conditions, and scope of the examination *751 and the person or persons by whom it is to be made.
Tex.R.Civ.P. 167a. (Emphasis added.)
Judge Whittington ordered Mrs. Coates to undergo a mental examination with a court appointed examining psychologist. Rule 167a expressly requires that a mental examination be conducted by a physician. A "physician" is "a practitioner of medicine" who is skilled in medicine and surgery. 42 Tex.Jur. 3d Healing Arts and Institutions § 1 (1985); Black's Law Dictionary 1033 (5th ed. 1979); see also Tex. Rev.Civ.Stat.Ann. art. 4495b, § 1.01 et seq. (Vernon Supp.1988). A psychologist is not a physician. Cf. Lenhard v. Butler, 745 S.W.2d 101, 105-06 (Tex.App.-Fort Worth 1988, writ denied). A psychologist, therefore, may not conduct a compulsory mental examination authorized by Rule 167a. The trial judge's order is invalid in this respect.
The more significant issue in this case, however, is whether the trial court abused its discretion by ordering Mrs. Coates to undergo a mental examination. Rule 167a was derived from Rule 35 of the Federal Rules of Civil Procedure and largely duplicates the language of the original federal rule.[1] Historical Note, Tex.R.Civ. P. 167a (Vernon 1976); 28 U.S.C.A. Fed.R. Civ.P. 35 (West 1968). Federal courts' construction of Rule 35 is thus helpful to an analysis of Rule 167a. The United States Supreme Court has held that federal Rule 35 requires an affirmative showing that the party's mental condition is genuinely in controversy and that good cause exists for the particular examination. Schlagenhauf v. Holder, 379 U.S. 104, 118, 85 S. Ct. 234, 242, 13 L. Ed. 2d 152 (1964). In Schlagenhauf, the Court expressly stated that these two requirements are not met "by mere conclusory allegations of the pleadings nor by mere relevance to the case." Id. Similarly, Rule 167a, by its express language, places an affirmative burden on the movant to meet a two pronged test: (1) the movant must show that the party's mental condition is "in controversy"; and (2) the movant must demonstrate that there is "good cause" for a compulsory mental examination. In the absence of an affirmative showing of both prongs of the test, a trial court may not order an examination pursuant to Rule 167a.
Drackett maintains that Coates' mental condition is in controversy because she has pleaded for mental anguish damages. In support of its position, Drackett relies on Schlagenhauf, 379 U.S. at 119, 85 S.Ct. at 243, where the United States Supreme Court stated:
A plaintiff in a negligence action who asserts mental or physical injury ... places that mental or physical injury in controversy and provides the defendant with good cause for an examination to determine the existence and extent of such asserted injury.
In Schlagenhauf, however, the court also warned that sweeping examinations of a party who has not affirmatively put his mental condition in issue may not be routinely ordered simply because the party brings a personal injury action and general negligence is alleged. Id. at 121, 85 S.Ct. at 244. Further, federal courts that have applied Rule 35 in light of Schlagenhauf have consistently distinguished "mental injury" that warrants a psychiatric evaluation from emotional distress that accompanies personal injury. Compare Anson v. Fickel, 110 F.R.D. 184, 186 (N.D.Ind.1986) (mental condition is in controversy when plaintiff claims mental problems that required confinement in a psychiatric hospital) and Lowe v. Philadelphia Newspapers, Inc., 101 F.R.D. 296, 298-99 (E.D.Pa. 1983) (mental condition is in controversy when plaintiff claims severe emotional distress and seeks to prove damages through testimony of psychiatrist) with Cody v. Marriott Corp., 103 F.R.D. 421, 423 (D.Mass.1984) (mental condition is not in controversy when plaintiff claims emotional distress and does not claim a psychiatric disorder requiring psychiatric or psychological counseling).
*752 In her suit against Drackett, Mrs. Coates asserts that she has suffered the type of emotional distress that typically accompanies a severe second degree burn and permanent scarring. In her deposition, she described her mental anguish as feelings of embarrassment and self-consciousness because the scar is ugly and noticeable in public. She is not alleging a permanent mental injury nor any deep seated emotional disturbance or psychiatric problem. Mrs. Coates' mental anguish claim is, therefore, for the emotional pain, torment, and suffering that a plaintiff who has been burned and scarred would experience in all reasonable probability. Compare Moore v. Lillebo, 722 S.W.2d 683, 688 (Tex.1986). Further, the record reflects that Mrs. Coates has not sought any type of psychiatric treatment as a result of the incident and, equally important, does not propose to offer psychiatric or psychological testimony to prove her mental anguish at trial.
To permit Drackett to compel a mental examination because Mrs. Coates has claimed mental anguish damages would open the door to involuntary mental examinations in virtually every personal injury suit. Rule 167a was not intended to authorize sweeping probes into a plaintiff's psychological past simply because the plaintiff has been injured and seeks damages for mental anguish as a result of the injury. Plaintiffs should not be subjected to public revelations of the most personal aspects of their private lives just because they seek compensation for mental anguish associated with an injury.
Drackett also contends that Mrs. Coates' mental condition has been placed in controversy by virtue of its contributory negligence claim. With regard to that claim, it is Mrs. Coates' conduct that is in controversy. The jury will be asked to decide whether Mrs. Coates was negligent in her use of the oven cleaner. Whatever mental processes underlay her conduct, it is the nature of that conduct, not the reasons for it, that is in issue. Rule 167a clearly does not contemplate that a plaintiff would be subjected to a probing psychiatric incursion into his or her entire psychological past on the strength of a defendant's contributory negligence claim.
The second requirement of Rule 167a is that the movant show "good cause" for compelling an examination. Drackett maintains that it showed good cause by its reference to Mrs. Coates' pre-existing personal problems which, Drackett asserts, may have caused Coates to injure herself with the oven cleaner. Drackett specifically refers to Mrs. Coates' marital problems, her concerns regarding her son's medical problems, and the fact that she had to take a lower paying job when her original employer re-located. Drackett places significance on the fact that Mrs. Coates had seen a doctor two or three times before the incident with the oven cleaner and had complained of depression and problems eating and sleeping. Drackett further emphasizes that on the day of Mrs. Coates' injury, the examining physician in the hospital emergency room noted in the medical record, "Husband states patient depresseddenies suicidal tendencies." Drackett insists that this notation suggests that Mrs. Coates was suicidal and may have misused the oven cleaner intentionally or with indifference to her welfare.
The "good cause" and "in controversy" requirements of Rule 167a are necessarily related. See Schlagenhauf, 379 U.S. at 118-19, 85 S.Ct. at 242-43. Mrs. Coates' prior problems are clearly peripheral to the issues in this case, and, consequently, they are not "in controversy." Drackett, however, attempts to meet the "in controversy" requirement by contending that Mrs. Coates' prior problems affected her mental state at the time she used the oven cleaner and they thus provide "good cause" for compelling a mental examination. Mrs. Coates' prior problems and attendant complaints of depression are distinct from the mental anguish she claims as a result of her injury. Drackett has failed to show any connection or "nexus" between Mrs. Coates' pre-injury depression and her post-injury embarrassment.
It is well settled that a tortfeasor takes a plaintiff as he finds him. Driess v. Friederick, 73 Tex. 460, 462, 11 S.W. 493, 494 *753 (1889); Thompson v. Quarles, 297 S.W.2d 321, 330 (Tex.App.-Galveston 1956, writ ref'd n.r.e.). Regardless of Coates' personal problems at the time of the incident with the oven cleaner, she is entitled to recover the damages resulting from the incident "conditioned as [she] was at the time of the injury." Driess, 73 Tex. at 462, 11 S.W. at 494; Thompson, 297 S.W.2d at 330. The fact that Mrs. Coates had personal problems at the time of her injury does not, in itself, relieve Drackett of liability, and does not, absent a showing of some connection to her allegation of mental anguish, provide good cause for compelling a mental examination.
A routine allegation of mental anguish or emotional distress does not place the party's mental condition in controversy. The plaintiff must assert mental injury that exceeds the common emotional reaction to an injury or loss. Assuming it is shown that a party has put his mental condition in controversy, good cause for the compelled examination must also be shown. The "good cause" requirement of Rule 167a recognizes that competing interests come into play when a party's mental or physical condition is implicated in a lawsuitthe party's right of privacy and the movant's right to a fair trial. A balancing of the two interests is thus necessary to determine whether a compulsory examination may properly be ordered.
The requirement of good cause for a compulsory mental examination may be satisfied only when the movant satisfies three elements. First, that an examination is relevant to issues that are genuinely in controversy in the case. It must be shown that the requested examination will produce, or is likely to lead to, evidence of relevance to the case. See Schlagenhauf, 379 U.S. at 117-18, 85 S.Ct. at 242-43. Second, a party must show a reasonable nexus between the condition in controversy and the examination sought. Neither of these requirements has been satisfied in this case. The mere pleading of mental anguish is inadequate to establish the necessity of plaintiff's submission to a mental examination. Finally, a movant must demonstrate that it is not possible to obtain the desired information through means that are less intrusive than a compelled examination. See Schlagenhauf, 379 U.S. at 118, 85 S.Ct. at 242; Marroni v. Matey, 82 F.R.D. 371, 372 (E.D.Pa.1979). The movant must demonstrate that the information sought is required to obtain a fair trial and therefore necessitates intrusion upon the privacy of the person he seeks to have examined. See Lowe v. Philadelphia Newspapers, Inc., 101 F.R.D. 296, 298 (E.D.Pa.1983). Drackett has made no showing that the information it seeks cannot be obtained by other discovery techniques. Mrs. Coates' privacy interests require, at minimum, that Drackett exhaust less intrusive means of discovery before seeking a compulsory mental examination. If, however, a plaintiff intends to use expert medical testimony to prove his or her alleged mental condition, that condition is placed in controversy and the defendant would have good cause for an examination under Rule 167a.
We hold that the trial judge abused his discretion in ordering Mrs. Coates to undergo a mental examination. We conditionally grant Mrs. Coates' petition for writ of mandamus. The writ will issue only if the trial judge refuses to rescind his order.
NOTES
[1] Fed.R.Civ.P. 35 has been amended to provide for compulsory mental examinations of persons in the custody or under the legal control of a party. Amended Rule 35 retains the requirements that the mental condition be in controversy and that good cause be shown. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2416803/ | 979 S.W.2d 343 (1998)
BROOKSHIRE BROTHERS, INC., Appellant,
v.
Talbert WAGNON, Appellee.
No. 12-97-00179-CV.
Court of Appeals of Texas, Tyler.
August 26, 1998.
Rehearing Overruled October 30, 1998.
*347 Curtis W. Fenley, III, Lufkin, for appellant.
Jim Ammerman, III, Marshall, for appellee.
Before HOLCOMB and HADDEN, JJ., and BASS, Retired Justice, Twelfth Court of Appeals, TYLER, sitting by assignment.
HOLCOMB, Justice.
Brookshire Brothers, Inc. ("Brookshire") files this appeal complaining of a judgment rendered for Talbert Wagnon ("Wagnon"). This worker's compensation nonsubscriber case was tried to a jury on two occasions. The first verdict was for Brookshire on a finding of no negligence. The trial court granted Wagnon's motion for new trial, and the second jury found for Wagnon and awarded him $750,000 .00 in damages. Brookshire files ten points of error. We will affirm.
Brookshire employed Wagnon as a butcher at its Carthage, Texas store. On the day of the injury, a delivery truck arrived with merchandise for the store. After the truck left, Wagnon and two other employees unloaded the pallets. The truck later returned with another pallet containing meat for the meat market. Wagnon unloaded the meat from this pallet by himself. The injury to his back occurred when he lifted a heavy box of meat (approximately 80 pounds), which was located on the pallet close to the floor, then twisted his body to place it on the top shelf of a cart. This cart was used to haul the meat to the cooler. Wagnon claimed at trial that Brookshire did not provide him with a safe workplace, since the boxes he was required to lift were too heavy to be lifted without help. He also maintained that Brookshire was aware of the dangers involved, since other workers had been similarly injured.
In its first point of error, Brookshire complains that the trial court erred in granting Wagnon's motion for new trial. It is well-settled Texas law, however, that an order granting a timely-filed motion for new trial is not subject to review on appeal. Hayden v. American Honda Motor Co., 835 S.W.2d 652, 654 (Tex.App.Tyler 1992, no writ). We overrule Brookshire's first point of error.
In its second point of error, Brookshire asserts that the trial court erred in denying its requested special issue on comparative causation. It cites Texas Workers' Compensation Comm'n. v. Garcia, 893 S.W.2d 504, 521 (Tex.1995) for the proposition that an injured employee in a nonsubscriber case must prove that he or she was not more than 50% negligent in causing the injury. We disagree that Garcia is determinative of this issue, however, because the dispute before the Supreme Court of Texas was the constitutionality of the Worker's Compensation Act. The language was not essential to the outcome of the case, nor did comparative negligence constitute even a minor issue in that case. The brief statement that an employee cannot recover if he is more than 50% negligent was clearly dicta and noncontrolling.
In an action against a nonsubscriber, it is not a defense 1) that the employee was guilty of contributory negligence; 2) that the employee assumed the risk of injury or death; or 3) that the injury or death was caused by the negligence of a fellow employee. TEX.LAB.CODE ANN. § 406.033 (Vernon 1996). The employer may only defend the action on the ground that the injury was caused by an act of the employee intended to bring about the injury or while the employee was in a state of intoxication. Id. In other words, the employer's only defense may be that it was not negligent in causing the injury or that its employee was the sole proximate cause of the injury. Holiday Hills Retirement and Nursing Center, Inc. v. Yeldell, 686 S.W.2d 770, 775 (Tex.App.Fort Worth 1985), rev'd on other grounds, 701 S.W.2d 243 (Tex.1985). The Worker's Compensation Act clearly seeks to exclude from jury consideration any issue submitting an employee's fault, negligence, or responsibility, other than sole proximate cause. We hold that in an employee's suit against a nonsubscribing employer, comparative negligence is not applicable and should not be submitted to the jury. See Id. We overrule point of error two.
*348 In its third point of error, Brookshire argues that the trial court erred in admitting evidence of unrelated prior acts to establish prior knowledge or foreseeability. At trial, Robert Jones ("Jones"), Charlotte Abernathy ("Abernathy") and Patricia Moore ("Moore") all testified regarding their claims of injuries and accidents on the job. In addition, Wagnon's expert testified concerning Jones, Abernathy and Moore's injuries as a prelude to his opinion that Brookshire was negligent when Wagnon was injured. Brookshire maintains that none of the injuries occurred in substantially similar circumstances as Wagnon's, and were therefore irrelevant. In addition, the injuries occurred prior to 1990 when Brookshire became a nonsubscriber and instituted a new training and safety program.
Relevant evidence is generally admissible. TEX.R.CIV.EVID. 402. The relevance, and therefore the admissibility, of other accidents or similar events is determined by: 1) a predicate of "similar" or "reasonably similar" conditions; 2) connection of the conditions in some "special way"; and 3) that the incidents occurred by means of the same instrumentality. Winn-Dixie Texas, Inc. v. Buck, 719 S.W.2d 251, 254 (Tex.App.Fort Worth 1986, no writ), overruled on other grounds, Greenhalgh v. Service Lloyds Ins. Co., 787 S.W.2d 938, 940 (Tex.1990). Admitting evidence is a matter within the discretion of the trial court. Tracy v. Annie's Attic, Inc., 840 S.W.2d 527, 531 (Tex.App. Tyler 1992, writ denied).
In the instant case, Wagnon was injured in the meat market when he lifted a heavy box of meat above his head and twisted his body to place the box on the unicart. Abernathy hurt herself when she lifted a heavy tray of meat and twisted her body in the process of setting it down. Jones hurt himself when he was required to pick up from the floor a plastic tub filled with meat, lift it up to his chest, push it away from his body and dump the meat upside down into a grinder. He had to twist his body in the process of lifting and dumping. Because the prior injuries of these other employees involved lifting heavy objects while incorporating a twisting motion, and there was no indication that any other condition was implicated in causing the injuries, the Winn-Dixie predicate was satisfied. In addition, these injuries were relevant to the issue of foreseeability, an element of negligence. Applying Rules 401 and 402 of the Rules of Civil Evidence, the court could have concluded that the prior injuries were relevant to show that Brookshire, with knowledge of the prior similar injuries, could have foreseen that failure to provide necessary equipment or failure to require team lifting might have contributed to Wagnon's injury. Consequently, we hold that the trial court did not abuse its discretion in admitting evidence of these injuries.
In regards to Moore, her testimony that she had been hurt while working for Brookshire came in without objection. She was then asked by Brookshire about going back to work after her injury. When Wagnon finally asked Moore how she was hurt, Brookshire objected. The trial court held a bench conference, but it was not on the record. Consequently, we do not know how or if the court ruled on the objection. Brookshire failed to complain that the conference was not on the record or that the court did not rule on the objection. Brookshire, therefore, waived error on the admission of Moore's testimony.
Brookshire also argues that Wagnon's expert witness, Henry Wickes ("Wickes"), was impermissibly allowed to testify about the above-described injuries. Because we have held that the occurrences satisfied the Winn-Dixie test, it was not error for Wickes to testify concerning those injuries. Brookshire further complains that the trial court erred when it admitted Jim Martin's ("Martin") testimony that when he was employed as a butcher through 1989, Brookshire had no safety program. Because of its proximity in time to Wagnon's injury in 1990, as well as because of its cumulative nature,[1] we hold *349 that this was not error, or if error, not harmful.
In its fourth point of error, Brookshire asserts that there was insufficient evidence of proximate causation to establish liability. In reviewing an attack on the legal sufficiency of the evidence, or a "no evidence" point, we consider only the evidence and reasonable inferences that tend to support the trial court's findings, and disregard all evidence and inferences to the contrary. Best v. Ryan Auto Group, Inc., 786 S.W.2d 670, 671 (Tex.1990). If there is more than a scintilla of evidence to support the finding, the court of appeals may not overturn the finding on a no evidence point of error. Responsive Terminal Systems, Inc. v. Boy Scouts of America, 774 S.W.2d 666, 668 (Tex. 1989). When reviewing a judgment to determine factual insufficiency of the evidence, this court must consider and weigh all of the evidence, and should set aside the finding only if it is so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. Cain v. Bain, 709 S.W.2d 175, 176 (Tex.1986).
As Brookshire correctly points out, causation consists of cause in fact and foreseeability. Brookshire asserts that the injury in question was not caused when Wagnon lifted a single box of heavy meat, but when he was simply performing his regular duties. Consequently, the injury was not foreseeable. It cites numerous pre-OSHA cases in support of this proposition. Werner v. Colwell, 909 S.W.2d 866, 869 (Tex.1995) makes it clear, however, that this is true only if the job itself is not unusual or does not pose a threat of injury.
Wickes testified that the guidelines for manual work practices, which was published by National Institute for Occupational Safety & Health ("NIOSH"), stated that the maximum permissible lift by the strongest, best-trained worker was 64.7 pounds. He also stated that these guidelines were commonly available to and used by employers in developing their own safety rules. Wickes further testified that the combination of the weight of the box and the method of lifting which Wagnon had to incorporate in order to do his job posed a threat of injury. He concluded that Brookshire was negligent in requiring its employees to lift such heavy boxes in such a manner, and that Brookshire's negligence was the cause of Wagnon's injury. Wickes stated that Brookshire should have reduced the weight of the meat boxes, should not have required transfer of boxes from pallet to unicart, should have used a team lifting procedure, a roller conveyor, or a trolley arrangement, and/or screened employees and determined the maximum weight which each employee could safely lift. He further testified that a simple admonishment to "bend legs and lift with legs and arms" would not have prevented Wagnon's injury, since it was a dynamic lift where Wagnon had to lift over his head and twist his body in order to place the box on the unicart.
Mike Frenzel ("Frenzel"), Brookshire's expert witness, testified that an employer cannot always eliminate the hazard of lifting. He further stated that NIOSH lifting guidelines are not law and that an employer is not compelled to comply with them. Frenzel pointed out that Wagnon's actions on the day in question constituted the worst combination of lifting problems. He testified that if Wagnon had gotten another cart and put the box on the lower level, Wagnon would have significantly reduced the risk of injury. Frenzel opined that training books on the subject of lifting should tell an employee to assess the lift, check the weight, check the object to determine if it can be gripped, check route and make sure it is clear, check footing, and if the object is too heavy, get help. He assumed that Brookshire had trained its employees on the correct lifting technique, but even if it had not, it was his opinion that Wagnon should have known the "rules" since he had been a butcher for thirty years. Frenzel agreed with NIOSH suggestions that a person should not turn while lifting, that he should not lift while in an awkward position, and that he should utilize team lifting of heavy objects. He admitted that Brookshire recognized that the weight of the meat boxes posed a lifting hazard.
Wagnon testified that on the day of his injury, there was only room for one more unicart in the cooler. Consequently, he had to pile the unicart with all of the boxes from *350 the pallet, requiring him to place boxes "head high." When he did so, his back began to hurt. Wagnon also stated that he had never been trained to lift correctly, had never seen a safety videotape, and had never been told about team lifting. He admitted that he signed a log in sheet stating that he had attended a meeting and saw a video, even though he had not. He did so because he was told by his supervisor that he could not work unless he signed. Cindy Hawley testified that before Wagnon began to unload the pallet on the day of his injury, he asked for help. None was forthcoming, however. According to Vincent Smith ("Smith"), the assistant store manager, there had never been a written safety policy before 1990. He did recall a poster on the wall which illustrated the correct way to lift. He did not remember if Wagnon saw the safety video. Martin agreed that there had never been any safe lifting classes, and no rules or guidelines on how much weight to lift or when to ask for help. Moore stated that there were no rules about asking for help, and that help was not always available. Mike Garner, Wagnon's manager, testified in his deposition that at the time of Wagnon's injury, there was no safety program and that he did not see the safety video until 1992. At trial, he stated that when Wagnon was injured, there was a videotape which showed employees how to lift correctly. He admitted that it would have been a better practice to enlarge the door to the cooler so employees could take the pallets directly into the cooler instead of first having to transfer the meat from the pallet to the unicart.
Robert Gilmer ("Gilmer"), Brookshire's Director of Risk Management, testified that he began developing a safety program in December of 1989. While doing his initial risk analysis, he identified some lifting injuries in the meat market area. He stated that the most significant factor in back injuries was the weight of the object lifted. Gilmer made one change in regards to the weight of meat boxes. He asked that three piece chuck boxes be changed to two piece chuck boxes, which reduced the weight from 115 pounds to 82-87 pounds. He produced the safety video, which discussed proper lifting procedure. In discussing lifting a 50-pound bag of dog food, he stated "we have a real problem here." When showing a "proper lift," he twisted in the process. There was nothing in the tape condemning an overhead lift. Gilmer told employees that if they needed some help, "try to get some help." In regards to lifting a 100-pound bag of potatoes, he said that, whenever possible, get help if it was available. He also stated that whenever possible, avoid putting strain on the back, but that employees must work in a hurry. Furthermore, at trial, he testified that he was not familiar with a team lift. Both the Jones and Abernathy injuries occurred before Wagnon hurt his back. They were performing substantially similar activities for Brookshire. Dr. David Hampton ("Hampton"), Wagnon's orthopedic surgeon, stated that his patient's heavy lifting on the day of his injury aggravated a pre-existing condition which had not previously caused Wagnon any problems.
The preceding evidence supports a finding that an injury such as Wagnon's was foreseeable to Brookshire and that Brookshire's action and/or inaction was the cause in fact of Wagnon's injury. We hold that the evidence of proximate cause, including cause in fact and foreseeability, was not so contrary to the overwhelming weight of the evidence as to be clearly wrong and unjust. We overrule point of error four.
In its fifth point of error, Brookshire complains that the trial court erred in overruling Brookshire's motion for a directed verdict. A directed verdict is proper under Texas Rule of Civil Procedure 301 when: (1) a defect in the opponent's pleadings makes them insufficient to support a judgment; 2) the evidence conclusively proves a fact that establishes a party's right to judgment as a matter of law; or 3) the evidence offered on a cause of action is insufficient to raise an issue of fact. Edlund v. Bounds, 842 S.W.2d 719, 723-24 (Tex.App.Dallas 1992, writ denied). If there is any conflicting evidence of probative value on any theory of recovery, the issue is for the jury, and an instructed verdict is improper. White v. Southwestern Bell Tel. Co., 651 S.W.2d 260, 262 (Tex.1983). In Brookshire's sixth point of error, it asserts that the trial court erred in denying Brookshire's motion for judgment notwithstanding *351 the verdict. A trial court may disregard a jury's findings and grant a motion for judgment notwithstanding the verdict, pursuant to Texas Rules of Civil Procedure 301 and 324(c) only when there is no evidence upon which the jury could have made its findings. Mancorp, Inc. v. Culpepper, 802 S.W.2d 226, 227 (Tex.1990). When there is more than a scintilla of competent evidence to support the jury's finding, the judgment notwithstanding the verdict was properly denied. Southern States Transp., Inc. v. State, 774 S.W.2d 639, 640 (Tex.1989). Consequently, the standard of review for the denial of a directed verdict and a judgment notwithstanding the verdict is the same. If there is some probative evidence of foreseeability and causation, then the trial court properly denied both motions. We hold that based upon the evidence as described earlier in this opinion, there was more than a scintilla of evidence to support a finding of negligence on the part of Brookshire. Points of error five and six are overruled.
In its seventh point of error, Brookshire maintains that the trial court erred in refusing to submit its requested explanatory instructions on negligence and its jury question on damages. The explanatory instructions requested by Brookshire were as follows:
Once an employer has furnished a safe way for an employee to do a job, the employer has no duty to provide a second safe way.
An employee cannot complain if an employer merely requires an employee to do the usual and customary work required of persons in his line of employment, or required by the character of the business in which he was employed.
Where an employer has provided a safe means of accomplishing a task, it is unreasonable to foresee that an employee will choose to perform the task in an unsafe manner.
An employer is not liable when it has provided help and injury results from the act of the employee in voluntarily proceeding to do the work without assistance. The same is true when sufficient help is nearby and available and the employee does the work alone without seeking or asking for assistance.
Brookshire argues that these instructions were necessary because to permit a broad form instruction of negligence without explanation of the duties of an employee, improperly shifts the burden of proof to the employer.
In regards to denying a requested instruction, the essential question before the trial court is whether the instruction will aid the jury in answering the questions. Louisiana & Ark. Ry. Co. v. Blakely, 773 S.W.2d 595, 598 (Tex.App.Texarkana 1989, writ denied). When the court refuses to submit a requested instruction, the question on review is whether the request was reasonably necessary to enable the jury to render a proper verdict. TEX.R.CIV .P. 277. When the refusal is based on a determination that the request is unnecessary, the abuse of discretion standard of review applies. Vinson & Elkins v. Moran, 946 S.W.2d 381, 405 (Tex.App.Houston [14th Dist.] 1997, no writ). We hold that the requested instructions were not necessary to enable the jury to render a proper verdict. The trial court did not abuse its discretion in refusing the submission of the instructions since they were not supported by the evidence, they were not correct statements of the law, and they impermissibly raised the issue of contributory negligence.
Brookshire also complains that the trial court erred in refusing to submit the following jury question on Wagnon's damage claims:
What sum of money, if paid now in this case, would fairly and reasonably compensate Talbert Wagnon for his injuries, if any, that resulted from the occurrence in question?
Consider the elements of damages listed below and none other. Consider each element separately. Do no include damage for one element in any other element. Do not include interest on any amount of damages that you find. Do not include any amount for any condition not resulting from the accident in question. Do not reduce the amounts, if any, in your answers because of the negligence, if any, of Talbert Wagnon. Answer in dollars and cents for damages.
*352
Sustained in past In reasonable probability will
be sustained in the future
Element A: Pain and suffering _________________ _______________
Element B: Mental anguish _________________ _______________
Element C: Loss of wages and
earning capacity _________________ _______________
Element D: Medical expenses _________________ _______________
Element E: Disfigurement _________________ _______________
Brookshire argues that the trial court erred by submitting a broad-form single damage question without separating the individual damage claims because this allowed the jury to determine damages on issues without evidence. Specifically, Brookshire complains that there was no evidence of future medical care or lost wages or earning capacity.
Texas Rule of Civil Procedure 278 provides that "[t]he court shall submit the questions ... in the form provided by Rule 277, which are raised by the written pleadings and the evidence." TEX.R.CIV.P. 278. The supreme court has interpreted Rule 278 as providing "a substantive, non-discretionary directive to trial courts requiring them to submit requested questions to the jury if the pleadings and any evidence support them." Elbaor v. Smith, 845 S.W.2d 240, 243 (Tex.1992). There is a presumption in favor of broad-form submission of questions. TEX.R.CIV.P. 277; Texas Dept. of Human Services v. E.B., 802 S.W.2d 647, 649 (Tex.1990). Therefore, if there is more than a scintilla of evidence of each of the elements of damages listed, the trial court should utilize the broad-form submission. To have a case reversed on jury charge error, however, harmful error must be shown. Boatland of Houston, Inc. v. Bailey, 609 S.W.2d 743, 749-50 (Tex.1980). Error is reversible only if, when viewed in light of the totality of the circumstances, it probably caused the rendition of an improper judgment. TEX.R.APP.P. 44.1(a)(1).
During trial, Wagnon testified to his age and to the amount of money he was earning each year before he was injured. He also testified that he had bad days and good days, and on bad days he could not get out of bed. On good days, he still hurt quite a bit and was not capable of doing many of the things which he did before his injury. Dr. Hampton testified that Wagnon had a progressive condition and that he had a permanent twenty-five pound lifting restriction, with no bending, carrying or lifting overhead. He further stated that it was possible that Wagnon would eventually need epidural cortisone injections or surgery. Dr. Hampton could not testify with reasonable medical probability that Wagnon would need future medical care, however. Although there was more than a scintilla of evidence of lost wages, there was no evidence of future medical expenses. Consequently, a question on future medical expenses should not have been submitted to the jury.
The question before us, then, is whether the court's submission of future medical expenses as an element of damages constituted reversible error. We note that the charge contained the limiting instruction "if any," when referring to the damages. The jury was also charged to consider each element separately. This clarified to the jury that Wagnon may not have suffered each element of damages. In addition, there is no showing that the jury awarded damages for future medical expenses. Furthermore, because there was evidence of damages in excess of the amount awarded by the jury without consideration of future medical expenses, *353 we hold that the broad-form submission listing future medical expenses as an element of damages was harmless error. We overrule point of error seven.
Brookshire next complains, in point of error eight, that the evidence was insufficient to support the jury's finding of damages. Specifically, Brookshire contends that there was no evidence of future medical expenses, loss of future wages or earning capacity, or mental anguish/pain and suffering.
Under applicable Texas law, a recovery for future medical expenses requires a showing that there is a reasonable probability that such medical expenses will be incurred in the future. Fibreboard Corp. v. Pool, 813 S.W.2d 658, 681 (Tex.App.Texarkana 1991, writ denied). Probability has been defined as "more than a 50 percent chance." Id. As we stated previously in this opinion, Wagnon failed to prove future medical expenses sufficient for recovery. His expert witness' testimony was entirely too speculative to constitute even some evidence that Wagnon would require medical treatment in the future.
Where a plaintiff seeks damages for impairment of earning capacity, he must prove the amount of such damages with the degree of certainty to which it is susceptible. Bonney v. San Antonio Transit Co., 160 Tex. 11, 325 S.W.2d 117, 121 (1959). A plaintiff must introduce evidence from which a jury may reasonably measure in monetary terms his earning capacity prior to injury, unless some reason appears for his failure to do so. Paragon Hotel Corp. v. Ramirez, 783 S.W.2d 654, 661 (Tex.App.El Paso 1989, writ denied). Although the amount of damages resulting from impairment of a plaintiff's earning capacity must be left largely to the sound judgment and discretion of the jury, the jury should not be left to mere conjecture where facts appear to be available upon which the jury could base an intelligent answer. Id. At trial, Wagnon testified that he earned $29,000 per year as a butcher, and that he was in excellent physical condition before he was hurt. He also stated that he was fifty years old when Brookshire discontinued his salary payments. The jury could have reasonably inferred that Wagnon's work-life expectancy constituted at least an additional fifteen years, and possibly more.[2] Thus, there was some evidence that Wagnon suffered a loss in earning capacity of at least $435,000.00.
The term "mental anguish" implies a relatively high degree of mental pain and distress. It means more than disappointment, anger, resentment or embarrassment, although it may include all of those. Parkway Co. v. Woodruff, 901 S.W.2d 434, 444 (Tex.1995). Mere emotions of anger, frustration and vexation are insufficient to conclude that a plaintiff suffered compensable mental anguish. Id. However, mental anguish may be implied from illness or injuries accompanied by physical pain that is proximately caused by the defendant. Kingham Messenger & Delivery Service, Inc. v. Daniels, 435 S.W.2d 270, 273 (Tex.Civ.App. Houston [14th Dist.] 1968, no writ); Coca Cola Bottling Co. of Fort Worth v. McAlister, 256 S.W.2d 654, 655 (Tex.Civ.App.Fort Worth 1953, no writ). And certainly the loss of enjoyment of life, which encompasses the loss of the injured party's former lifestyle, may be considered when determining mental anguish damages. Fibreboard Corp., 813 S.W.2d at 674-75. An award of mental anguish damages will survive a legal sufficiency challenge when the plaintiff has introduced direct evidence of the nature, duration, and severity of his mental anguish, thus establishing a substantial disruption in his daily routine. Parkway, 901 S.W.2d at 444. In the instant case, Martin testified that he was a good friend of Wagnon's and that he was aware of how the back injury affected his life. He stated that Wagnon could no longer hunt, work on cars, do karate or roller skate. Jones agreed that Wagnon could no longer wash and wax his own cars. Wagnon testified that he had trouble sleeping, lost his house after having paid on the mortgage for seventeen years, and could no longer play with his grandchildren. He also stated that he was in almost constant pain. Wagnon's wife claimed that Wagnon could not work on *354 cars, skate, play tennis, practice karate or hunt because of his back injury. Dr. Hampton testified that Wagnon's condition was progressive and that it would probably never improve. A life expectancy table was introduced to indicate how long into the future Wagnon would probably suffer from his disability. We hold that there was some evidence sufficient to support an award of damages for mental anguish and physical pain and suffering as well as loss of earning capacity. We overrule point of error eight.
Brookshire, in its ninth point of error, complains that the trial court erred in denying Appellant's motion for remittitur. Although the trial court has no authority to change the jury's award, the trial court judge may suggest a remittitur. William Powers, Jr. & Jack Ratliff, Another Look at "No Evidence" and "Insufficient Evidence," 69 TEX.L.REV. 515, 564 (1991). The proper standard of review in reviewing a trial court's denial of a motion for remittitur is factual sufficiency, not abuse of discretion. See Snoke v. Republic Underwriters Ins. Co., 770 S.W.2d 777, 777-78 (Tex.1989). We must "examine all the evidence in the record to determine whether sufficient evidence supports the damage award, remitting only if some portion is so factually insufficient or so against the great weight and preponderance of the evidence as to be manifestly unjust." Pope v. Moore, 711 S.W.2d 622, 623 (Tex. 1986). The process of awarding damages for amorphous, discretionary damages, such as mental anguish and pain and suffering, is inherently difficult because the injury constitutes a subjective, unliquidated, non-pecuniary loss. See Duron v. Merritt, 846 S.W.2d 23, 26 (Tex.App.Corpus Christi 1992, no writ). It is "necessarily an arbitrary process, not subject to objective analysis." LaCoure v. LaCoure, 820 S.W.2d 228, 234 (Tex.App. El Paso 1991, writ denied). Because there are no objective guidelines to assess the money equivalent to such injuries, the jury is given a great deal of discretion in awarding an amount of damages it determines appropriate. Hicks v. Ricardo, 834 S.W.2d 587, 591 (Tex.App.Houston [1st Dist.] 1992, no writ). A challenge to a damages award for these types of unliquidated and intangible injuries is reviewed as any other challenge based upon the sufficiency of the evidence. Larson v. Cactus Util. Co., 730 S.W.2d 640, 641 (Tex.1987). Because there was evidence of $435,000.00 in lost wages, as well as substantial evidence of mental anguish, including loss of enjoyment of life, and physical pain and suffering both in the past and the future, we do not find that an award of $750,000.00 was so against the great weight and preponderance of the evidence as to be manifestly unjust. Point of error nine is overruled.
In its tenth point of error, Brookshire complains that the trial court erred in denying Brookshire's motion for mistrial regarding insurance. Normally, disclosing an employer's nonsubscriber status to the jury is error. FFP Operating Partners, L.P. v. Love, 884 S.W.2d 898, 899 (Tex.App.Texarkana 1994, no writ). In a review of the record, when Wagnon first stated to the jury during voir dire that this was "not a worker's compensation case," Brookshire objected and sought a mistrial. It failed, however, to request an instruction to disregard or obtain a ruling by the trial court. Furthermore, during trial Brookshire discussed and explained at length its decision to opt out of the worker's compensation system. Brookshire, therefore, waived error. We overrule point of error ten.
The judgment of the trial court is affirmed.
NOTES
[1] Several other employees testified that there was no safety program before 1990, including Wagnon's manager at the time of the injury.
[2] Work-life expectancy need not be based on life expectancy tables; the jury may reach its own conclusion on work-life expectancy based on evidence of the injured person's age, health, and physical condition prior to the injury, and the permanence of the injury. Borden Inc. v. Guerra, 860 S.W.2d 515, 524-25 (Tex.App.Corpus Christi 1993, writ dism'd by agr.). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1493337/ | 288 S.W.2d 811 (1956)
C. E. FULGHAM, Secretary of State, et al., Appellants.
v.
GULF, COLORADO & SANTA FE RAILWAY Co., Appellee.
No. 10380.
Court of Civil Appeals of Texas, Austin.
March 7, 1956.
Rehearing Denied March 28, 1956.
*812 John Ben Shepperd, Atty. Gen., W. V. Geppert, L. P. Lollar and Henry Gates Steen, Asst. Attys. Gen., for appellants.
Wigley, McLeod, Mills & Shirley, Galveston, C. K. Richards, Austin, for appellee.
GRAY, Justice.
This suit was brought by appellee, Gulf, Colorado & Santa Fe Railway Company, against appellants, the Secretary of State, the Attorney General and the State Treasurer in their official capacities to recover franchise taxes and penalties paid under protest together with interest. A nonjury trial resulted in a judgment for appellee.
Appellee is a railroad corporation operating in Texas and other states. A portion of its lines of railroad in Texas extends through the counties of Hill, Bosque, Tom Green, Collin and Tarrant. The War Department of the Federal Government through its Corps of Engineers constructed dams and reservoirs for flood control and water conservation by reason of which portions of appellee's railroad lines in the above counties were affected and appellee was ordered and directed to relocate and reconstruct such lines. The lines were so relocated and reconstructed and the cost thereof was paid by the Federal Government. This cost exceeded the book value of the previously existing lines by $5,259,895.87. In accordance with the requirements of the Interstate Commerce Commission, Sec. 20, 49 U.S.C.A.§ 20, this sum of money was listed by appellee in its books and records as "Donations and Grants."
In due time appellee filed its franchise tax return for the year 1954 wherein it listed the above sum of $5,259,895.87 as "Donations and Grants" and paid its franchise tax based on a deduction of this amount. Thereafter the Secretary of State assessed appellee with an additional sum of $477.50 and penalties in the sum of $119.38, and also pursuant to Chapter 2, Art. III, Sec. 1, Acts of the 53rd Legislature, First Called Session, 1954, Vernon's Ann.Civ.St. art. 7084, assessed appellee with additional franchise taxes of which $286.50 was the amount assessed due to the value of appellee's relocated and reconstructed lines. The three sums of money set out supra were paid by appellee under protest. Art. 7057b, Vernon's Ann.Civ.St. Appellee paid the balance of the franchise taxes assessed against it but contended the sums paid under protest were not due and owing by it.
The facts show and the trial court found that the relocated railroad lines are 1.16 miles longer than the old lines; that some of the bridges and structures on the relocated lines are longer than those on the old lines; that the cost of maintaining the bridges, structures and roadbed on the relocated lines will exceed such costs on the old lines; that the relocated lines do not contribute to a more efficient operation of appellee's lines of railroad and will not produce any additional revenue to appellee.
Appellants and appellee agree that the question to be here decided is: Does the $5,259,895.87 constitute surplus within the meaning of the franchise tax statutes, Arts. 7084, 7084½ and 7089, Vernon's Ann.Civ. St.
So far as pertinent to our inquiry here Art. 7084, supra, provides that every corporation authorized to do business in Texas shall on or before May 1 of each year pay to the Secretary of State a franchise tax for the year following" based upon that portion of the outstanding capital stock, *813 surplus and undivided profits, plus the amount of outstanding bonds, notes and debentures * * * and provided further that the tax shall in no case be computed on a sum less than the assessed value, for State ad valorem tax purposes, of the property owned by the corporation in this State. * * *"
Art. 7089, supra, provides that every corporation required to pay a franchise tax shall file with the Secretary of State a sworn report which "shall give the cash value of all gross assets of the corporation, the amount of its authorized capital stock, the capital stock actually subscribed and the amount paid in, the surplus and undivided profits or deficit, if any * * * the assessed value, for State ad valorem purposes of all property of the corporation, real, personal or mixed, owned by the corporation in this State. * * *"
Art. 7084½, supra, levies a franchise tax additional to those levied, due and payable under Art. 7084, supra.
"Surplus" is used in Art. 7084 and Art. 7089, supra, but the Legislature has not seen fit to define the term nor has the term as there used been defined by the courts of this State. However in United North & South Development Co. v. Health, Tex.Civ.App., 78 S.W.2d 650, 652, er. ref., the term was applied to the facts before the court and it was said:
"As used in the franchise tax law in arriving at a proper meaning of that term, the purposes of the Legislature should be looked to. It is to be borne in mind that a franchise tax is not a tax upon the property of the corporation nor one upon its income, though both are to be regarded in measuring such tax, but a charge made by the state against the corporation for the privilege granted it to do business in the state. State ex rel. Marquette Hotel Inv. Co. v. State Tax Comm., 282 Mo. 213, 221 S.W. 721, 726; Southern Realty Co. v. McCallum, 5 Cir., 65 F.2d 934. Manifestly, as appears both from article 7084, R.S., as amended, and from amended article 7089, R.S., prescribing the information such corporation is required to furnish the secretary of state, it was the purpose of the Legislature to levy against the corporation a tax commensurate with the value of the privilege granted, as that value is reflected by the information contained in the corporation's franchise tax report."
The Court further said:
"Since such tax is payable in advance, the state may, in computing such tax, look to the property owned by the corporation and available to it, for use during the ensuring year in carrying on its business. Such was clearly, we think, the legislative intent.
"In the instant case we think that any strict or technical definition of the term `surplus' as used in the statute should not be applied, but one which would effectuate the legislative intent."
In Edwards v. Douglas, 269 U.S. 204, 205, 46 S. Ct. 85, 88, 70 L. Ed. 235, cited in United North & South Development Co. v. Heath, supra, Judge Brandeis discussed surplus of a corporation as used in the Federal Revenue Act and among other things said:
"The surplus account represents the net assets of a corporation in excess of all liabilities including its capital stock. This surplus may be `paid-in surplus,' where the stock is issued at a price above par; it may be `earned surplus,' as where it was derived wholly from undistributed profits; or it may, among other things, represent the increase in valuation of land or other assets made upon a revaluation of the company's fixed property."
The value of appellee's relocated and reconstructed lines is an increase in the value of its railroad lines used in conducting its business and therefore constitutes an increase in the value of its property or assets.
We think that the intent of the Legislature to include property values in computing *814 franchise taxes is made certain by the provisions of Arts. 7084 and 7089, supra. Both statutes mention the assessed value of the property and Art. 7084 provides that in no case shall the tax be computed on a sum less than such assessed value.
The parties agree that the Secretary of State is not bound by the bookkeeping rules and regulations of the Interstate Commerce Commission. However appellee says that the Railroad Commission of Texas on August 28, 1914 issued a rule for the classification of Texas railroad corporations, the same being Circular No. A-13, wherein it adopted "Classification of Accounts as prescribed by the Interstate Commerce Commission in accordance with Section 20 of the act to regulate commerce, issue of 1914."
The statutes, Art. 6466 et seq., Vernon's Ann.Civ.St. authorize the Railroad Commission to prescribe a method to be followed by railroads in keeping accounts in order that the Commission may properly regulate the matters which are within its authority, such as rates, etc. Texas & P. Ry. Co. v. Railroad Commission, 105 Tex. 386, 150 S.W. 878. However there has not been called to our attention any rule, regulation or law requiring the Secretary of State to apply the above classification of railroad property in computing franchise taxes.
Appellee further says that the question presented is: Does Appellee come within the statutory provisions imposing the tax as to the $5,259,895.87 in question? and says that because the question is open to doubt that the doubt should be resolved in favor of the taxpayer and cites Carpenter v. Bass, Tex. Civ.App., 142 S.W.2d 406. Affirmed Texas Unemployment Compensation Commission v. Bass, 137 Tex. 1, 151 S.W.2d 567. We think an application of this rule of law to the facts here is not called for because if what we have already said is correct then doubt does not exist.
The franchise tax in the amount of $477.50 was not paid when due as provided by Art. 7084, supra, and appellee became liable to the penalty assessed by Art. 7091 which provides:
"Any corporation * * * which shall fail to pay any franchise tax provided for in this Chapter when the same shall become due and payable under the provisions of this Chapter, shall thereupon become liable to a penalty of twenty-five per cent(25%) of the amount of such franchise tax due by such corporation. * * *"
The statute assesses the penalty for the failure to pay the tax when due and the Secretary of State is not vested with discretion in the matter or compelled to notify the party in default before such penalty accrues. Clark v. International Harvester Co., Tex.Civ.App., 115 S.W.2d 1022, er. ref.
The judgment of the trial court is reversed and judgment is here rendered that appellants recover of appellee the sums of money supra paid by appellee under protest.
Reversed and rendered.
HUGHES, Justice (concurring).
In testing appellee's main contention I have assumed the opposite fact situation from the one presented. If instead of increasing the value of appellee's facilities by over five million dollars through relocation of certain lines the value of such facilities had been diminished by five million dollars it seems certain to me that appellee would have demanded and would have been entitled to receive a pro tanto decrease in its franchise tax liability. The rule should work both ways.
The Health case cited by the Court is also authority for holding immaterial the manner in which this item was carried by appellee on its books. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1454031/ | 748 P.2d 724 (1988)
COMPASS INSURANCE COMPANY, Appellant (Defendant),
v.
CRAVENS, DARGAN AND COMPANY, Appellee (Plaintiff).
No. 87-27.
Supreme Court of Wyoming.
January 13, 1988.
*725 Dennis W. Lancaster of Phillips, Lancaster and Thomas, P.C., Evanston, and Allan L. Larson of Snow, Christensen & Martineau, Salt Lake City, Utah, for appellant.
Timothy O. Beppler of Vehar, Beppler, Jacobson, Lavery & Rose, P.C., Evanston, for appellee.
Before BROWN, C.J., and THOMAS, CARDINE, URBIGKIT and MACY, JJ.
*726 MACY, Justice.
This is an appeal from a judgment against appellant Compass Insurance Company (Compass) awarding complete reimbursement to appellee Cravens, Dargan and Company (Cravens) for the amount it paid to the State of Wyoming for the clean-up of an oil spill.
We affirm in part and reverse in part.
The issue to be resolved is which of these insurers for the State of Wyoming insured the cost of cleaning up the oil spill.
Sometime after 4:00 p.m. on March 18, 1984, an unknown person entered the Wyoming highway department maintenance yard at Evanston, Wyoming, and opened the valve on an oil storage tank. Surrounding the maintenance yard was a ten-foot high chain link fence with barbed wire on top. Access gates to the maintenance yard were locked after 4:00 p.m. The maintenance yard had never before been vandalized, and the highway department personnel had no reason to believe that it would be vandalized.
When the unlocked oil storage tank valve was opened, approximately 3,000 gallons of road oil valued at $2,337 flowed out of the tank, across the maintenance yard, down a hill, and into a drainage or irrigation ditch, and it was carried by water onto landowners' fields.
Upon discovering the oil spill, the highway department immediately took steps to have the oil spill cleaned up. No formal complaint was ever made against the State of Wyoming by any third party for damage to any property caused by the oil spill. However, the highway department personnel did receive complaints from landowners that a fence was destroyed and fields were rutted during the clean-up process. One landowner also complained that his cows could not drink the polluted stock water. The highway department caused the fence to be replaced, the ruts to be filled with top soil, and water to be hauled to the landowner's stock until the polluted water was clean enough for the stock to drink.
The cost of cleaning up the oil spill on the property owned by the State of Wyoming was $8,821, and the cost of cleaning up the oil spill on the property owned by others was $85,635.
At the time of the oil spill incident, the State of Wyoming had an effective comprehensive liability insurance policy issued by Compass and an effective property insurance policy issued by Cravens. Thereafter, the State of Wyoming made claims against Compass and Cravens for $96,792, which included the costs associated with cleaning up the oil spill and the value of the oil spilled. Cravens ultimately paid the $96,792 claim and accepted a subrogation receipt from the State of Wyoming wherein the State subrogated all its rights, claims, and interest which it might have against any person or corporation liable for the loss and authorized Cravens to sue, compromise, or settle the claim in the name of the State. Compass refused the demand made by Cravens for reimbursement of the $96,792 Cravens had paid to the State of Wyoming. On April 29, 1985, a complaint was filed in the Third Judicial District Court styled "STATE OF WYOMING, Plaintiff, v. COMPASS INSURANCE COMPANY, a New York Corporation, Defendant," alleging that the State of Wyoming was liable for the cost of cleaning up the oil spill and any monetary damages arising therefrom and that, pursuant to the terms of the State's insurance policy with Compass, Compass was obligated to pay for those amounts.
Compass filed its answer alleging that Cravens, and not the State of Wyoming, was the real party in interest and that, pursuant to the terms of the liability policy Compass had issued to the State, it owed no duty or obligation to either the State or Cravens for any expenses, costs, or damages occasioned by the oil spill.
Cross-motions for summary judgment were denied, and the court ordered that the caption of the case be amended to substitute Cravens as the real party in interest in place of the State of Wyoming. On October 9, 1986, a bench trial was held, and, on December 4, 1986, the trial court entered judgment generally in favor of Cravens and against Compass for the sum of $118,144.09, *727 which amount represents clean-up costs of $94,455, prejudgment interest of $13,567.88, attorneys fees of $10,000, and costs of $121.21.
Two questions must be answered in order to resolve this case: (1) Does the Compass policy cover the oil spill; and (2) if the Compass policy does cover the oil spill, does Cravens have a right to reimbursement from Compass.
The primary coverage language in the comprehensive liability policy issued by Compass provides in relevant part:
"The company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of * * * property damage * * * caused by an occurrence * * *."
The Compass policy defines "occurrence" as
"an accident, including continuous or repeated exposure to conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured[.]" (Emphasis added.)
It also defines "property damage" as:
"(1) physical injury to or destruction of tangible property which occurs during the policy period, including the loss of use thereof at any time resulting therefrom, or (2) loss of use of tangible property which has not been physically injured or destroyed provided such loss of use is caused by an occurrence during the policy period[.]"
We disagree with Compass' assertion that the incident may not be an occurrence. A general finding and judgment carry with them every finding of fact which reasonably and fairly can be drawn from the evidence. Burk v. Burzynski, Wyo., 672 P.2d 419 (1983). Our examination of the record reveals that the trial court reasonably and fairly could have drawn from the evidence that one would not expect vandals to climb the ten-foot high chain link fence and open the valve on the oil storage tank.
We also disagree with Compass' assertion that there is no evidence of damage to property of third parties. The evidence clearly shows that the oil spill resulted in the contamination of the ditch bank and the fields of landowners adjacent to the highway department maintenance yard and that the costs associated with cleaning up this property amounted to $85,635. The trial court could have reasonably and fairly drawn from the evidence that there was physical injury to, and loss of use of, tangible property; i.e., property damage as defined in the Compass policy.
In Lansco, Inc. v. Department of Environmental Protection, 138 N.J. Super. 275, 350 A.2d 520 (1975), aff'd 145 N.J. Super. 433, 368 A.2d 363, 88 A.L.R. 3d 172 (1976), the Superior Court of New Jersey decided a case with facts nearly identical to this one. In that case, a person or persons unknown opened the valve on two storage tanks causing some 14,000 gallons of oil to leak from the tanks. The oil flowed into two storm drains which in turn emptied into the Hackensack River. At the time of the incident, Lansco had an effective general comprehensive liability policy with provisions the same or similar to the Compass policy.
The policy held by Lansco, like the Compass policy, defined an "occurrence" as an accident "`which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured.'" Id. 350 A.2d at 523. The court in Lansco, Inc. v. Department of Environmental Protection stated:
"`Accidental' is defined as happening unexpectedly or by chance; taking place not according to usual course. Webster's New International Dictionary, and Black's Law Dictionary * * *; Furr v. Metropolitan Life Ins. Co., 111 N.J. Super. 596, 600, 270 A.2d 69 (Law Div. 1970); see Linden Motor Freight Co. v. Travelers Ins. Co., 40 N.J. 511, 193 A.2d 217 (1963). Further, under the definition of `occurrence' contained in the policy, whether the occurrence is accidental must be viewed from the standpoint of the insured, and since the oil spill was neither expected nor intended by Lansco, it follows that the spill was sudden and accidental under the exclusion clause *728 even if caused by the deliberate act of a third party." Id. 350 A.2d at 524.
That court concluded that coverage under the comprehensive general liability policy extended to statutory liability for damages to the environment. Id. at 524. The insurer was required to reimburse Lansco for its costs to clean up the spill. Id. at 525; see also Chemical Applications Company, Inc. v. Home Indemnity Company, 425 F. Supp. 777 (D.Mass. 1977).
Compass contends that the intent of its policy is to pay only damages for which the State is legally liable and that the State is not legally liable for the costs of cleaning up the property of a third party because no notice of claim has been filed against the State as required by law.[1] Compass also contends that, in any event, the State cannot be held liable under the Wyoming Governmental Claims Act.[2]
There is no question that the highway department had the legal liability to clean up the oil spill. The department of environmental quality, established by the Wyoming Environmental Quality Act,[3] has the obligation to promulgate rules and regulations necessary to prevent, reduce, and eliminate waste. Tri-State Generation and Transmission Association, Inc. v. Environmental Quality Council, Wyo., 590 P.2d 1324 (1979). In carrying out this obligation, the department prepared and put into effect Chapter IV, Section 5.c of its Water Quality Rules & Regulations, which provides that a person[4] owning oil which is discharged is responsible for the cleanup of the discharged oil. The act and the rules and regulations promulgated to carry out the purpose of the act make it clear that the State is obligated to pay for these damages without there being a judicial determination of that fact.
Compass contends that no right of subrogation exists in favor of one insurer against another insurer of the same insured. Assuming, arguendo, that Compass is correct, we fail to see how this provides any comfort to Compass. The learned trial judge in his wisdom wisely side-stepped this problem and ordered that the caption of the case be amended, substituting Cravens as the real party in interest in place of the State of Wyoming. This order was in accord with Compass' third defense which alleged that Cravens, not the State of Wyoming, was the real party in interest.
We agree with Compass that Cravens does not have a right of subrogation on the basis of Compass being at fault for the oil spill. Cravens' action, however, is not on the basis of Compass' negligence. To the contrary, the action is for reimbursement on the theory that Compass, rather than Cravens, should have indemnified the State for the clean-up costs.
Compass' contention that the State cannot be held liable because it is immune from strict liability by virtue of § 1-39-102(b), W.S. 1977, of the Wyoming Governmental Claims Act is without merit in this instance. This subsection provides in part:
"This act does not impose [or] allow the imposition of strict liability for acts of governmental entities or public employees." (Emphasis added.)
There is not a scintilla of evidence in the record indicating that a governmental entity or an employee of the State was in any way responsible for the oil spill. The evidence is that the oil spill was caused by unknown third persons.
Compass' contention that there is no legal liability because no formal claims were filed is also without merit.[5] If the insurer's *729 promise to pay is to be of any practical value, it must include an obligation of good faith and reasonableness. From the beginning, the highway department was in a dilemma. If it did nothing to clean up the oil spill, the damages would be much greater. The damages would be much greater even if it waited only for determinations as to who was liable and who would direct the cleanup. An oil spill into flowing water, by its nature, requires an immediate clean-up response. That no formal claims were filed is a credit to the highway department's clean-up efforts, not an excuse for Compass to deny coverage. The principles of good faith and reasonableness require the insurer, under these circumstances, to acquiesce to the clean-up efforts. Compass has not pointed to any detriment which it has suffered from the highway department's actions. Compass stipulated to the damage amounts, and the liability is clear. Compass' coverage was not expanded in any way by the highway department's action. Rather, the highway department's actions limited the damages.
Because the Compass policy does cover the oil spill, we reach the second question: Does Cravens have a right to reimbursement from Compass?
Compass argues that Cravens voluntarily indemnified the State for the cost of the cleanup, that Cravens is liable because its policy has a debris removal clause, and that, if Cravens is entitled to contribution from Compass, it should be on the basis of the amount of the coverage provided by each policy. Cravens in turn argues that it was not a volunteer because it wanted to avoid a potential bad faith claim and that, even if the debris removal clause in its policy does apply, it still is not responsible for all the clean-up costs because of the "other insurance," "escape," and "super escape" clauses in its policy.
The primary coverage language in the property insurance policy issued by Cravens provides in relevant part:
"Subject to the terms, conditions and exclusions hereinafter contained, this Policy insures all Property (including improvements and betterments) of the Insured * * * against ALL RISKS OF DIRECT PHYSICAL LOSS OR DAMAGE * * *."
The Cravens policy also contains a debris removal clause:
"This Policy also covers, within the sum insured, expenses incurred in the removal of debris of the property covered hereunder which may be destroyed or damaged by a peril insured against."
The Compass policy, in addition to its primary liability coverage language, contains an exclusion for pollution coverage:
"This insurance does not apply:
* * * * * *
"(f) to bodily injury or property damage arising out of the discharge, dispersal, release or escape of smoke, vapors, soot, fumes, acids, alkalis, toxic chemicals, liquids or gases, waste materials or other irritants, contaminants or pollutants into or upon land, the atmosphere or any water course or body of water; but this exclusion does not apply if such discharge, dispersal, release or escape is sudden and accidental[.]" (Emphasis added.)
It also includes an exclusion for damage "to property owned or occupied by or rented to the insured."
To counter Compass' assertion that clean-up costs are "debris removal" costs and not "damages" to property, Cravens contends that the discharged oil caused injury to property and that the amount expended for clean-up costs is the proper measure of damages. We agree with Cravens that the discharged oil caused injury to the property covered by the oil. We also *730 agree with Cravens and the court in Lansco, Inc. v. Department of Environmental Protection that the proper measure of property damage is the cost of cleaning up the oil when there is no residual damage to the property.
General principles of construction will be followed when interpreting conditions of an insurance agreement. Commercial Union Insurance Company v. Stamper, Wyo., 732 P.2d 534 (1987). Two basic standards of construction applicable in Wyoming are:
1. "`Such [insurance policy] contracts should not be so strictly construed as to thwart the general object of the insurance. Miles v. Continental Casualty Company, Wyo., 386 P.2d 720, 722 [(1963)].'" Id. at 539, quoting McKay v. Equitable Life Assurance Society of United States, Wyo., 421 P.2d 166, 168 (1966).
2. "`The intention of the parties is the primary consideration and is to be ascertained, if possible, from the language employed in the policy, viewed in the light of what the parties must reasonably have intended. Wilson v. Hawkeye Casualty Co., [67 Wyo. 141], 215 P.2d [867,] 873-875 [(1950)].'" Id. at 539, quoting McKay v. Equitable Life Assurance Society of United States, 421 P.2d at 168.
We stated in Wilson v. Hawkeye Casualty Co., 67 Wyo. 141, 215 P.2d 867, 874 (1950), quoting McGrail v. Equitable Life Assur. Soc. of United States, 292 N.Y. 419, 55 N.E.2d 483, 486 (1944):
"`Consistently followed in this State has been the rule that the policy must be construed reasonably and that it must be given a practical construction, not thereby with the result that there is a revision of the policy or an increase of the risk and thus an extension of the resulting liability, but for the purpose of determining what the parties must reasonably have intended by its terms when the policy was written by defendant and accepted by the plaintiff.'"
It is clear to this Court that the intent of the Cravens policy is to pay for damage to property of the State and that the intent of the Compass policy is to pay for damage to property of others caused by an incident neither expected nor intended; i.e., an occurrence. The trial court correctly found that Compass had the primary responsibility for the damage to the property of others. We will not now dissect the respective policies in an attempt to determine who wins the battle of the forms with respect to other insurance clauses.
The combination of Compass' refusal to pay a claim for which it was primarily responsible and Cravens' good faith effort to settle the claim with minimal inconvenience to its insured resulted in the inequitable result of Compass paying nothing for a claim covered by its policy.
Compass also claims that Cravens acted as a mere volunteer when it paid the State's claim and that, under the holding of Commercial Union Insurance Company v. Postin, Wyo., 610 P.2d 984 (1980), Cravens is not entitled to reimbursement from anyone. We disagree that Cravens acted as a mere volunteer. The test for voluntary payment by an insurer was addressed in Commercial Union Insurance Company v. Postin, 610 P.2d at 990, wherein the holding in Wyoming Building & Loan Ass'n v. Mills Const. Co., 38 Wyo. 515, 269 P. 45, 60 A.L.R. 418 (1928), was reaffirmed that an insurer who acts in good faith to discharge a disputed obligation does not become a mere volunteer if it is ultimately determined that the insurer's policy did not apply.
The trial court's judgment carries with it the finding that Cravens' payment was "`in good faith'" and "`under a reasonable belief that it [was] necessary'" so as to not defeat the right to reimbursement. Commercial Union Insurance Company v. Postin, 610 P.2d at 990. However, we cannot ignore the uncontradicted evidence that the discharged oil was also on State property and that the cost of cleaning up the oil on this property was $8,821. The State property is insured by Cravens and excluded from the coverage provided by Compass. Accordingly, we remand to the district court with directions that the judgment entered against Compass be reduced *731 by $8,821 plus the interest charged thereon.
Affirmed in part and reversed in part.
URBIGKIT, J., files a dissenting opinion.
URBIGKIT, Justice, dissenting.
It is unusual, but rationally to be recognized, that neither the original litigants nor now the majority opinion and this dissent define the issue of this case in corollary status or by comparable question. Differing from the court in analysis of pleading, policies, and legal principles, I would conclude that the issue is not which of two insurers, one property-damage and the other liability (each insuring some interest of the state of Wyoming), should be liable to indemnify the state for malicious-mischief damage when vandals open the tank valves of a road oil storage facility at a highway department shop, but rather whether the property-damage carrier, after payment and with at least apparent liability on its policy, can secure "reimbursement" by either subrogation or contribution from the liability carrier.
Little benefit will be afforded in writing the standard for this case in argumentation whether the property-damage carrier had a coverage responsibility, since first that fact appears reasonably discernible from the specific terms of the policy, and secondly, it must have been obvious since the carrier paid the claim without ostensible assertion of being a volunteer charity institution as a good samaritan in paying the state of Wyoming the claimed $94,455 even when coincidentally blessed with a policy with a scheduled property value of $341,312,860 and policy limits of $50 million, for physical-damage insurance coverage of state buildings and properties, comparable with the liability carrier's maximum coverage of $500,000 per incident.
Factually and procedurally, this litigation is sufficiently strange so that, at least in contemplation of a standard for future litigation, we could leave its precedential value in a fashion akin to the paraphrased comment as Justice Felix Frankfurter once related in dissent, and I would find here similarly to be perceived, as the flying Dutchman known only as a floating hulk once briefly observed upon the silent sea to surely disappear as having been a temporary mirage in the ocean of law.
Someone vandalized the state highway property in Evanston by opening a valve of a road oil storage tank. With a property-damage carrier, Cravens, and a liability carrier, Compass, the state made claims for the spilled oil clean-up costs on and off the property occupied by the highway department facility and for the oil lost in drainage.
Cravens, the property-damage carrier, with a debris-clean-up provision reasonably defining its liability, paid the clean-up costs less $1,000 deductible, while the liability carrier, Compass, denied any claimed liability to be impressed from negligence of its insured, the state of Wyoming, and consequently declined to pay the state for what the state had collected from Cravens under the property-damage policy. Cravens, as the liability carrier, after taking a subrogation receipt, sued Compass in the name of the state, alleging that their mutual insured, the state, was liable for the clean up based on strict liability and lack of due care and that consequently the state of Wyoming was entitled to repayment of what it had expended, including interest and attorney's fees, which constituted its claim for subrogation after the state had been paid in full for expenditures less property-damage deductible. The only complaint ever filed was in the name of the state of Wyoming against Compass as liability carrier by attorneys for the subrogating property-damage carrier, and in no way included any direct subrogation claims of the property-damage carrier which had made the payment.
The history of the pleadings assumed an interesting metamorphosis in that at a considerably later date, in ruling adversely to the "State's" motion for summary judgment, the trial court, without benefit of motion or request, determined that the obvious real party in interest was Cravens and not the state, and amended, in an order *732 denying the summary judgment by substituting the additional litigative plaintiffs.[1]
As noted, the complaint was filed pursuant to a subrogation receipt in the name of the state as the designated plaintiff, alleging the liability carrier's legal responsibility and the indemnity obligation of Compass (liability carrier) to the state for the damages sustained by the state and paid to the state less the deductible. Questionably, whether or not the suit was originally filed with approval of the state in the fashion not in evidence, a ratification by both a member of the office and the attorney general himself was subsequently filed to demonstrate the authorization of the law firm actually representing the subrogating insurance company to proceed in the name of the state of Wyoming. Nothing was pleaded about the interest of the subrogating carrier, nor was a motion for summary judgment ever made in its name.
The subrogation receipt provided:
"SUBROGATION RECEIPT
* * * * * *
"In consideration of and to the extent of said payment the undersigned hereby subrogates said Insurance Company, to all of the rights, claims and interest which the undersigned may have against any person or corporation liable for the loss mentioned above, and authorizes the said Insurance Company to sue, compromise or settle in the undersigned's name or otherwise all such claims and to execute and sign releases and acquittances and endorse checks or drafts given in settlement of such claims in the name of the undersigned, with the same force and effect as if the undersigned executed or endorsed them.
"Warranted no settlement has been made by the undersigned with any person or corporation against whom a claim may lie, and no release has been given to anyone responsible for the loss, and that no such settlement will be made nor release given by the undersigned without the written consent of the said Insurance Company and the undersigned covenants and agrees to cooperate fully with said Insurance Company in the prosecution of such claims, and to procure and furnish all papers and documents necessary in such proceedings and to attend court and testify if the Insurance Company deems such to be necessary but it is understood the undersigned is to be saved harmless from costs in such proceedings.
"[Signed by a representative of the State of Wyoming.]"
In the subsequently entered order denying summary judgment as filed "by the State of Wyoming," (emphasis added) the judge found and determined:
"Thereafter, the Attorney General of the State of Wyoming authorized this action to be filed in the name of the State of Wyoming by Cravens, Dargan & Company against the Compass Insurance Company, which is the insurance company which insures the State against personal liability. Obviously, the real party in *733 interest in this case is Cravens, Dargan & Company, not the State of Wyoming. "Cravens, Dargan & Company seeks to recover from Compass the money which Cravens has paid to the State of Wyoming. Cravens contends that the State of Wyoming was `legally obligated to pay as damages' costs of cleaning up the oil (damage). Cravens seeks reimbursement from Compass of all monies which it paid, which includes the cost of the oil which was lost, the cost of cleaning up property belonging to the State of Wyoming and the cost of cleaning up property belonging to private citizens.
"Cravens has moved for summary judgment. Clearly, Cravens is not entitled to judgment against Compass for the sums paid for lost oil or damage to property belonging to the State of Wyoming. At most, Cravens would be entitled to reimbursement for the sums paid in discharge of liability of the State of Wyoming for damages to the property of others.
"Unfortunately, Cravens has not established:
"a) As a matter of law, the absolute liability of the State of Wyoming for the oil spill which occurred; or
"b) That the State of Wyoming did not enjoy immunity.
"Furthermore, if the State is not immune from suit, and if there is no absolute liability, there remain questions of fact concerning whether or not the State was negligent.
"THEREFORE, IT IS ORDERED:
"1. The caption of this case is amended to substitute the real party in interest in place of the State of Wyoming. The caption shall now read Cravens, Dargan & Company, a corporation, vs. Compass Insurance Company, a New York Corporation.
"2. The Motions for Summary Judgment are denied." (Emphasis added.) (Signed by the district judge and entered May 15, 1986.)[2]
Intrinsic to the evidentiary status of this case is a total absence of any evidence in defined dollars as to damages sustained by any third parties. Actually, the record reflects that oil ran out onto the property of two ranchers, but no defined dollar amount was included to reflect the costs incurred separately for the clean up on their property or whether the substantial costs, which were for diking and retention and reclamation of the oil, could be considered to have occurred on property of the state of Wyoming through its public waterways or, in fact, may have occurred on private ditches of these or other adjoining landowners. Two maps which were referenced in the testimony which would have afforded some geographical description of what occurred (the first being a chalkboard exhibit at trial which was not marked and introduced, and the second being an earlier attachment to the Department of Environmental Quality report as the report was then introduced without attachment), are not included in the present record.
*734 Succinctly then, the case in totality is an inquiry as to whether or not a liable property-damage carrier, after policy payment, can either get subrogation or contribution from a liability carrier arising from the contended negligence or duty-derived strict liability of the mutually insured. I do not even get to the questions of whether or not the Compass policy covered the oil spill, whether strict liability existed, or whether the state is entitled under these circumstances to indemnity, since the case dispositively should invoke a subrogation question between two carriers for the same insured. Although there was obvious damage to the property of the two ranchers, Crompton and Lowham, whether the particular clean-up costs and renovation damages on their particular property was the total amount of the claimed off-premises clean up of $85,635 or some fraction of that amount, was simply and totally undefined and unproven in the trial record and case pleadings. No one ever plead that the only two mentioned or any other linked parties sustained definable damages in the case facts and liability-policy provisions after the property-damage carrier reimbursed the state for all clean-up costs as claimed and paid within its malicious-mischief/debris-clean-up insurance policy clauses.
The totality of my difference with the majority in this case is in contemplation of their statement:
"We agree with Compass that Cravens does not have a right of subrogation on the basis of Compass being at fault for the oil spill. Cravens' action, however, is not on the basis of Compass' negligence. To the contrary, the action is for reimbursement on the theory that Compass, rather than Cravens, should have indemnified the State for the clean-up costs."
Reluctantly, I conclude that this critique of the case simply does not make sense. Not only does it not make any sense, but it was not the critical basis upon which the litigation was pursued by the parties in trial. The complaint, which is the only complaint ever filed, albeit in the name of the state of Wyoming, alleged against the state of Wyoming, inter alia:
"2.5 Under WS § 35-11-101, et seq. Plaintiff State of Wyoming was strictly liable because of the extreme and permanent damage such pollution can and does cause to the land and property of others for both the costs of cleaning up the oil spill and any monetary damages arising therefrom; and Plaintiff State of Wyoming was therefore legally obligated to pay such damages within the terms of its insurance policy with Defendant Compass.
"2.6 Plaintiff State of Wyoming was strictly liable to the adjoining property owners under the doctrine of abnormally dangerous activities for both the costs of cleaning up the oil spill and any monetary damages arising therefrom; and Plaintiff State of Wyoming was therefore legally obligated to pay such damages within the terms of its insurance policy with Defendant Compass.
"2.7 Plaintiff State of Wyoming was strictly liable to the adjoining landowners under the doctrines of public and private nuisance for both the costs of cleaning up the oil spill and any monetary damages arising therefrom; and Plaintiff State of Wyoming was therefore legally obligated to pay such damages within the terms of its insurance contract with Defendant Compass.
"2.8 Based on allegations that the Plaintiff State of Wyoming failed to exercise due care in failing to take adequate safety precautions to prevent the subject oil spill, Plaintiff State of Wyoming was liable to adjoining landowners for both the costs of cleaning up the oil spill and any monetary damages arising therefrom; and Plaintiff State of Wyoming was therefore legally obligated to pay for such damages within the terms of its insurance contract with Defendant Compass.
"2.9 Under the terms of its insurance policy with Plaintiff State of Wyoming, Defendant Compass is obligated to pay Plaintiff State of Wyoming for both the amounts Plaintiff State of Wyoming expended in cleaning up the oil spill and the *735 amount of any monetary damages arising therefrom.
* * * * * *
"WHEREFORE, Plaintiff State of Wyoming prays for judgment against Defendant Compass as follows:
"1. That Defendant Compass be held liable to Plaintiff State of Wyoming for damages in an amount to be proven at trial;
"2. That Defendant Compass be held liable to Plaintiff State of Wyoming for Plaintiff's costs and disbursements incurred herein * * *."
In its brief filed in this court, appellant enunciates the issues as:
"I. CAN AN INSURANCE COMPANY PROVIDING PROPERTY INSURANCE BRING SUIT AGAINST ITS OWN INSURED, OR ITS OWN INSURED'S LIABILITY INSURER, FOR THE RECOVERY OF SUMS IT PAID OUT UNDER ITS POLICY?
"II. CAN A LIABILITY INSURER BE LIABLE WHERE ITS INSURED WOULD NOT BE?
"III. ASSUMING BOTH POLICIES COVERED THE LOSS, IS CRAVENS ENTITLED TO CONTRIBUTION, AND IF SO, HOW SHALL THE CONTRIBUTION BE APPORTIONED?"
Appellee states the issues as:
"1. WHETHER THE TRIAL COURT ERRED IN DETERMINING THAT APPELLANT'S POLICY OF LIABILITY INSURANCE COVERED AND THAT APPELLANT WAS RESPONSIBLE FOR THE COSTS INCURRED BY THE WYOMING HIGHWAY DEPARTMENT TO CLEAN UP AN OIL SPILL FOR WHICH IT WAS STRICTLY LIABLE UNDER WYOMING LAW?
"2. WHETHER THE TRIAL COURT ERRED IN DETERMINING THAT APPELLEE, THE STATE OF WYOMING'S PROPERTY INSURER, WAS ONLY RESPONSIBLE FOR THE VALUE OF THE OIL WHICH WAS LOST AS A RESULT OF THE OIL SPILL?
"3. WHETHER THE TRIAL COURT ERRED IN DETERMINING THAT APPELLEE WAS ENTITLED TO REIMBURSEMENT FROM APPELLANT FOR SUMS APPELLEE PAID TO THE STATE OF WYOMING ON ACCOUNT OF THE POLLUTION CLEAN-UP COSTS INCURRED BY THE WYOMING HIGHWAY DEPARTMENT?",
and in argument in the brief:
"Generally, Appellee contends that the trial court correctly determined that Appellant's liability insurance policy covered the pollution clean-up costs in question; that only the value of the oil lost, as a result of the oil spill, was covered by Appellee's property insurance policy; and that under these circumstances Appellee was entitled to be reimbursed by Appellant for sums Appellee had paid the State of Wyoming on account of the pollution clean-up."
Appellee then further contends that the other insurance clause in its policy was a super-escape clause and as a result
"* * * Appellee was at most a secondary insurance provider and the effect of the respective policies was to create liability solely on the part of Appellant. Appellant issued the insurance coverage which was primarily applicable to the oil-spill incident. As a result, appellee was entitled to proceed in this action to seek reimbursement from appellant for the sums it had paid to the state on account of the pollution clean-up costs incurred [under its policy]."
In resulting memoranda briefing and extended argument, Cravens continued to allege a legal liability of the state of Wyoming, the indemnity responsibility of Compass, and the resulting right of Cravens to be subrogated and repaid based on a primary responsibility of the liability carrier to repay the property-damage carrier.
The principal issue of this case is the appearance of creating a novel and completely unaccepted rule that a property-damage carrier which pays for the physical damage to the insured's property can effectively allege negligence of its insured in order to subrogate against a liability carrier. It is pointless to argue that Cravens did not have original liability, because either *736 they had liability when they made the payment under their issued insurance coverage, or they volunteered by payment in order to avoid a contested or contended liability which in itself does not afford any differing status for its subrogation posture. In this latter regard, Commercial Union Insurance Co. v. Postin, Wyo., 610 P.2d 984 (1980), is directly in point and is now apparently ignored by this court. An excellent synopsis of the law of subrogation of volunteered payment is found in Frago v. Sage, Mo. App., 737 S.W.2d 482 (1987).
In its misapprehension of the litigative issue, I would find in logical perspective no significance in this court's decision except that one insurance company won and the other lost in this particularly convoluted and inexplicable circumstance. To the contrary, if the rule of the case is considered to be its real issue of the right of subrogation of a property-damage carrier against its mutual insured's liability carrier, then we find ourselves not only in the Sargasso Sea attendant to the hulk of Frankfurter's perception, but flailing water by the teaspoonful when faced with a typhoon by challenging the weight of general law denying a right of subrogation. Illustrative only of the multitude of authorities that might be noted are Aetna Insurance Co. v. Craftwall of Idaho, Inc., 757 F.2d 1030 (9th Cir.1985); United States v. St. Bernard Parish, 756 F.2d 1116 (5th Cir.1985), cert. denied 474 U.S. 1070, 106 S. Ct. 830, 88 L. Ed. 2d 801 (1986); Frank Briscoe Co. v. Georgia Sprinkler Co., Inc., 713 F.2d 1500 (11th Cir.1983); Lanasse v. Travelers Insurance Co., 450 F.2d 580 (5th Cir.1971), cert. denied sub nom. Chevron Oil Co. v. Royal Ins. Co., 406 U.S. 921, 92 S. Ct. 1779, 32 L. Ed. 2d 120 (1972); Transamerica Insurance Co. v. Gage Plumbing & Heating Co., 433 F.2d 1051 (10th Cir.1970); Stafford Metal Works, Inc. v. Cook Paint & Varnish Co., 418 F. Supp. 56 (N.D.Tex. 1976); Builders & Manufacturers Mutual Casualty Co. v. Preferred Automobile Ins. Co., 118 F.2d 118 (6th Cir.1941); Moring v. State Farm Mutual Automobile Insurance Co., Ala., 426 So. 2d 810 (1982); Graham v. Rockman, Alaska, 504 P.2d 1351 (1972); Pendlebury v. Western Casualty & Surety Co., 89 Idaho 456, 406 P.2d 129 (1965); Truck Insurance Exchange v. Transport Indemnity Co., 180 Mont. 419, 591 P.2d 188 (1979); Home Insurance Co. v. Pinski Brothers, Inc., 160 Mont. 219, 500 P.2d 945 (1972); Reeder v. Reeder, 217 Neb. 120, 348 N.W.2d 832 (1984); Manzo v. City of Plainfield, 59 N.J. 30, 279 A.2d 706 (1971); A & B Auto Stores of Jones St., Inc. v. City of Newark, 59 N.J. 5, 279 A.2d 693 (1971); Chenoweth Motor Co. v. Cotton, 2 Ohio Misc. 123, 207 N.E.2d 412 (1965); Board of Education of Jordan School District v. Hales, Utah, 566 P.2d 1246 (1977); Kirkland v. Ohio Casualty Ins., 18 Wash. App. 538, 569 P.2d 1218 (1977); Miller v. Kujak, 4 Wis. 2d 80, 90 N.W.2d 137 (1958); Appleman, Insurance Law and Practice, § 1164; Couch on Insurance 2d. It is axiomatic that:
"No right of subrogation can arise in favor of the insurer against its own insured, since by definition subrogation arises only with respect to rights of the insured against third persons to whom the insurer owes no duty." 16 Couch on Insurance 2d § 61:136 at 195, also quoted in Moring v. State Farm Mutual Automobile Insurance Company, supra.
Of current interest as a subrogation issue involving law firms and legal fees, see St. Paul Fire & Marine Insurance Co. v. Perl, Minn., 415 N.W.2d 663 (1987).
The judgment in favor of appellee subrogating insurance carrier, Cravens, provided:
"THIS MATTER having come on regularly for a trial before the Court, sitting without a jury, * * * and the Court being fully advised in the premises.
"NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that Plaintiff shall be, and hereby is, awarded judgment in its favor and against Defendant in the sum of Ninety-Four Thousand Four Hundred Fifty-Five Dollars ($94,455.00), together with interest thereon at the rate of seven percent (7%) per annum from September 20, 1984 to the date of trial in the amount of Thirteen Thousand Five Hundred Sixty-Seven *737 Dollars and Eighty-Eight Cents ($13,567.88), together with attorneys fees in the amount of Ten Thousand Dollars ($10,000.00), and together with costs in the amount of One Hundred Twenty-One Dollars and Twenty-One Cents ($121.21), for a total judgment in favor of Plaintiff and against Defendant in the sum of One Hundred Eighteen Thousand One Hundred Forty-Four Dollars and Nine Cents ($118,144.09), together with interest thereon at the rate of ten percent (10%) per annum from October 9, 1986 until paid in full."
The only further learning we are afforded from the record as to the basis of decision was the statement of the trial court at the conclusion of oral argument, wherein he said:
"It's the order of this Court and the judgment of this Court that Compass shall be responsible for the sum of Strike that. That Cravens shall be responsible for the sum of $2,237 and Compass shall be responsible for the sum of the difference between $2,237, the cost of the oil, and $96,792."
Surely an emphatic and careful examination of the record would reveal that the case is a simple subrogation proceeding where, after the property-damage carrier has paid under its policy, it attempts to subrogate in the name of the state against the state to reach the state liability carrier. As demonstrable of the failure of issue analysis, the trial court judgment is primary evidence when the court even gave judgment against the liability carrier in favor of the property-damage carrier for clean up on the property of the insured. It was apparent that the basis of the trial court's decision was on a subrogation right to affix total liability on the liability carrier, even if it involved clean up on the property of the insured where no possibility of existence of liability could be inferred. The majority conversely seem to determine that the issue is liability of the state for oil spill without any understanding of insurance coverage in stating in conclusion what it had avoided in logical argument:
"* * * The trial court correctly found that Compass had the primary responsibility for the damage to the property of others. We will not now dissect the respective policies in an attempt to determine who wins the battle of the forms with respect to other insurance clauses."[3]
The construction of the policies by this court simply has no basis in either subrogation law or the policy terminology. Farmers Insurance Exchange v. Fidelity Casualty Company of New York, Wyo., 374 P.2d 754 (1962). Cravens undertook certain liabilities for property ownership including damage, malicious mischief and clean up while the defined basis of Compass was for indemnity where liability was asserted and demonstrated.[4]
*738 A different basis for denial is to be found in the somewhat similar situations which were considered in the riot liability cases of A & B Auto Stores of Jones St. v. City of Newark, supra, and Manzo v. City of Plainfield, supra, where property-damage carriers as exposed to claims from the cities' race riots asserted subrogation against the towns which were subjected to absolute liability for property damage by statute. In denying subrogation, the court recognized actual fault of a third party and denied subrogation to the property-damage carriers. The fact that the city carried liability insurance would furthermore not justify subrogation as between the two carriers. Imposition of absolute liability did not include application of subrogation exposure to the liability carrier.
What the court actually holds here is that the property-damage carrier is entitled to subrogate as either a volunteer or as the issuer of a secondary coverage which, in either case, is directly contrary to the statement that this is not a subrogation action, and to do so not premised on the joint insured's negligence but contended on statutorily impressed absolute liability. The insurer that accepted the premium for a policy of insurance including vandalism assumed the risk that a third-party vandal would appear and cause policy-covered property damage. Cf. Board of Education of Jordan School District v. Hales, supra.
Synthesizing its position in subrogation letters written to a representative of Compass, Cravens stated:
"We insure the State of Wyoming on a first party basis. A claim in the amount of $95,455.58 has been submitted to us as first party carrier for an oil spill in Evanston, Wyoming. * * *
"In reviewing your policy, we feel that it should respond or at [least] participate in this loss."
And subsequently:
"We had just made payment of $96,792.06 to the State of Wyoming covering the oil spill.
"I believe you are familiar with the claim as C.G. Iversen of GAB was handling the claim on our behalf; I believe she also represented you.
"We did make full payment of the claim as we were getting pressure from the State of Wyoming and rather than put the state in the middle while we discussed responsibility, felt it best if we paid the claim.
"However, we definitely feel that you also had some, if not full, responsibility for this claim and so are looking to you for contribution."
Again in later correspondence:
"Under the facts and law as outlined above, Compass Insurance Company's policy with the State of Wyoming provides coverage for the damages resulting from the oil spill of March 19, 1984. Cravens, Dargan & Company, as subrogee of the State of Wyoming, hereby demands that Compass Insurance Company immediately pay, as required under the terms of its policy with the State of Wyoming, $96,792.06 to Cravens, Dargan & Company."
Conversely, the position of Compass is well stated and properly synthesized in its trial brief:
"As will be seen, plaintiff's lengthy argument that the Compass policy might cover the oil spill is irrelevant. The defendant will assume without conceding, for the purpose of the pending motions, that the oil spill was caused by an `occurrence', that the pollution exclusion does not exclude coverage, and that the State of Wyoming was `legally obligated' to pay for the cost of the clean-up, and that none of the terms of the Compass policy exclude coverage.
"However, whether the Compass policy might cover the oil spill is not the issue; Craven's claim against Compass is precluded (1) because it constitutes an impermissible attempt to subrogate against its own insurer, (2) because contribution *739 cannot be enforced between insurers of diverse interests, property, and risk, and (3) if contribution is allowed, the `other insurance' clauses relieve Compass of any obligation or limit it to one percent of the loss."
Appellant there noted to the trial court, and re-emphasizes in accord with the standards of law presently existent, that Cravens was improperly attempting to subrogate against its own insured. I would agree with its characterization of this universally recognized rule firmly supported by the totality of case law and precedent that without entitlement to subrogate property damage, Cravens was also not benefited by right of contribution, since that theory is not available where policies of different kinds insure against different risks. Granite State Insurance Company v. Employers Mutual Insurance Company, 125 Ariz. 275, 609 P.2d 90 (1980); Republic Insurance Co., v. United States Fire Insurance Co., 166 Colo. 513, 444 P.2d 868 (1968); Indiana Insurance Company v. Sentry Insurance Company, Ind. App., 437 N.E.2d 1381 (1982); United Services Automobile Association v. Agricultural Insurance Co. of Watertown, New York, 67 N.M. 333, 355 P.2d 143 (1960).
"* * * The authorities are legion that for a proportionate recovery clause to operate in the insurer's favor, or for the enforcement of contributions between insurers, there must be identity of risk." Northland Insurance Company v. Miles, Wyo., 446 P.2d 160, 161 (1968).
I would also agree with the characterization expressed in another subrogation-contribution-excess insurance-coverage case where in dissent Justice Harnsberger observed:
"* * * The reasoning relied upon * * *, although subtly expressed, is neither persuasive nor sufficiently impressive to warrant overriding adherence to old legal principles." Farmers Insurance Exchange v. Fidelity & Casualty Company of New York, supra, 374 P.2d at 766.
Two axioms are misinterpreted or ignored by the court in the conclusions made. The first is that Cravens either had ostensible or actual liability and satisfied a definable claim by payment to the state of Wyoming, or put itself in the position of a sheer volunteer without liability or obligation. Commercial Union Insurance Co. v. Postin, supra; Southwest Mississippi Electric Power Association v. Harragill, 254 Miss. 460, 182 So. 2d 220 (1966). See also Fulton v. Des Jardins, 67 Wyo. 517, 227 P.2d 240 (1951), cited with approval in Commercial Union Insurance Co. v. Postin, supra. The second axiom that follows is that in either regard the premise upon which reimbursement is requested is based upon the non-existent or secondary liability of Cravens and the primary liability of Compass as a matter of subrogation of a property-damage carrier against the liability carrier. Thirdly, not as a matter of an axiom, but rather as a matter of characterization, the liability status of the state of Wyoming for the oil spill in any defined dollar amount, and whether that defined liability is determinable in strict liability so as to impose a dollar liability on Compass, was and is a question upon which sufficient facts were not presented in the record for any decision; nor is a legal basis presented demonstrating compliance with the Wyoming Governmental Claims Act and other comparable requirements and criteria for an indemnity obligation to arise when any potential liability of the insured was earlier discharged by another payment medium.
I would reverse and remand for dismissal of the State of Wyoming/Cravens litigation to surcharge a liability carrier for what the property-damage carrier had paid under its insurance policy.
NOTES
[1] Section 1-39-113, W.S. 1977.
[2] Sections 1-39-101 through 1-39-120, W.S. 1977.
[3] Section 35-11-103(a)(i), W.S. 1977.
[4] As set out in § 35-11-103(a)(vi), W.S. 1977:
"`Person' means an individual, partnership, firm, association, joint venture, public or private corporation, trust, estate, commission, board, public or private institution, utility, cooperative, municipality or any other political subdivision of the state, or any interstate body or any other legal entity[.]" (Emphasis added.)
[5] The limitation language in the Compass policy states:
"The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense other than for first aid to others at the time of accident."
And:
"No action shall lie against the company unless, as a condition precedent thereto, there shall have been full compliance with all of the terms of this policy, nor until the amount of the insured's obligation to pay shall have been finally determined either by judgment against the insured after actual trial or by written agreement of the insured, the claimant and the company."
[1] The circumstance of an ex parte amendment of this kind by the court has curious facets, but none more interesting than the result on the demand for attorney's fees included in the original complaint, based upon § 26-15-124, W.S. 1977, which affords a remedy of an insured against his carrier for inopportunely denied payment of insurance benefits. The amount of attorney's fees was stipulated as reasonable, but a logical or a legally justified basis for award in a subrogation case of this kind is absolutely lacking. Although strongly presented in trial, the question of the attorney's fees was not separately presented on appeal, and no further inquiry will be pursued except to reiterate that a basis for the award is not presented in this record. See F.D. Rich Co., Inc. v. United States for Use of Industrial Lumber Co., Inc., 417 U.S. 116, 94 S. Ct. 2157, 40 L. Ed. 2d 703 (1974); Smith v. Equitable Life Assurance Society, 614 F.2d 720 (10th Cir.1980); Downing v. Stiles, Wyo., 635 P.2d 808 (1981); State Surety Co. v. Lamb Construction Co., Wyo., 625 P.2d 184 (1981). Cf. Bruegger v. National Old Line Insurance Co., 387 F. Supp. 1177 (D.Wyo. 1975), modified on other grounds, 529 F.2d 869 (10th Cir.1976). In result, this was a subrogation and carrier's award of attorney's fees under a first-party insured's benefit statute.
It would be a well-reasoned assessment that judgment was entered in behalf of a litigant which was never pleaded as a party on a claim that it never made by the nominal plaintiff as its insured suing itself with attorney's fees awarded without any statutory or legal justification.
[2] Two interesting facets of this order deserve note in this record. First, since Cravens was never a party it had never moved for summary judgment, and secondly, a $1,000 deductible, which would have created and maintained a proper real-party-in-interest relationship with the state of Wyoming, Gardner v. Walker, Wyo., 373 P.2d 598 (1962), seemingly disappeared by disingenuous disregard of the litigant and the court. Purists in pleading would find all of this interesting, since an earlier stipulation entitled "The State of Wyoming v. Compass Insurance Company" reflected the reasonable clean-up cost and that no claim has ever been made against the highway department or the state of Wyoming by any third party for damages to the property caused by the oil spill; that Cravens had a $50 million policy and had paid the clean-up costs; and that "Cravens by letter dated July 10 and September 20, 1984, and March 8, 1985, * * * made demand upon Compass for repayment of all or a portion of those sums paid by Cravens to the State of Wyoming." The fiduciary responsibility of a subrogating insurance carrier for the deductible also seemingly evaporated. Compass had earlier raised the real-party-in-interest defense which was obviated by the action of the court in summary-judgment order amendment by unrequested substitution of parties when in the process the highway department's $1,000 deductible got lost. The existence of a liability policy deductible was not addressed in this record, so if Cravens was entitled to recover, why the state was not repaid the deductible is a total mystery as at least a sail upon that silent sea.
[3] The interjection of strict liability in addition to negligence occasions the confusion defining the scope of the Compass policy. Clearly, negligence was never demonstrated or even realistically contended. Consequently, a properly based contention of liability carrier indemnity obligation resulting from negligence of its insured is not presented. The premise of obligation moves to an occurrence concept of insurance indemnifying without regard to negligence premised on obligation of its insured which arises from ownership but not negligence.
The two cases cited by the majority, Lansco Inc. v. Department of Environmental Protection, 138 N.J. Super. 275, 350 A.2d 520 (1975), aff'd 368 A.2d 363 (1976), certification denied 73 N.J. 57, 372 A.2d 322 (1977), and Chemical Applications Co., Inc. v. Home Indemnity Co., 425 F. Supp. 777 (D.Mass. 1977), invoke no discussion of the subrogation conclusion, and consequently they have no precedential relation to the present issues. At issue in those cases was coverage protection between the insured and the liability carrier without consideration of either subrogation or governmental entity liabilities issues. See likewise, Evans v. Aetna Casualty & Surety Co., 107 Misc. 2d 710, 435 N.Y.S.2d 933 (1981).
[4] Although otherwise at least tentatively presented by appellee Cravens, this court has declined consideration of insurance clauses of the respective policies which would raise the escape versus excess constructional attributes as frequently invoked albeit normally only if insurance of like kind. For a discussion of excess versus escape clauses, see Maryland Casualty Co. v. Horace Mann Insurance Co., 551 F. Supp. 907 (W.D.Penn. 1982), aff'd 720 F.2d 664 (3d Cir.1983). See the rule restated in Horace Mann Insurance Co. v. Continental Casualty Co., 54 N.C. App. 551, 284 S.E.2d 211 (1981). Cf. Wyoming Farm Bureau Mutual Insurance Co. v. American Hardware Mutual Insurance Co., Wyo., 487 P.2d 320 (1971). An excellent current review of "escape," "excess," and "pro-rata" insurance clauses is found in Comment, "Other Insurance" Conflicts in Arizona, 19 Ariz.L.J. 475 (1987). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1473330/ | 158 F.2d 878 (1947)
DI PASQUALE
v.
KARNUTH et al.
No. 77, Docket 20347.
Circuit Court of Appeals, Second Circuit.
January 11, 1947.
Benedict T. Mangano, of Albany, for appellant.
R. Norman Kirchgraber, of Buffalo, for appellees.
Before L. HAND, CHASE, and FRANK, Circuit Judges.
L. HAND, Circuit Judge.
DiPasquale appeals from an order, dismissing a writ of habeas corpus to review an order, deporting him to Italy for two reasons: (1) Because he had been convicted of robbery before he entered the United States; and (2) because he had been again convicted within five years after he had entered, and had been sentenced for more than a year.[1] The facts were as follows. DiPasquale lawfully entered the United States from Italy on June 21, 1907, at the age of fourteen; he has resided in Buffalo thereafter during all the period here involved. On May 11, 1915, he was convicted of robbery (the length of the sentence does not appear), and he was again convicted of robbery on June 5, 1919 (his sentence then being for thirty-eight years). He was released on parole on December 13, 1937; but was arrested for deportation two years later, and was ordered deported on June 11, 1945. Admittedly, he is subject to deportation, if he re-entered the United States on September 15, 1918; and admittedly he is not so subject, if he did not: that is the only issue in the case. His supposed re-entry was on the night of September 15, 1918, when he went by sleeping car from Buffalo to Detroit upon the Michigan Central Railroad, whose route lies through Canada. He was asleep during the time he was outside the United States, and woke up in Detroit; there was no evidence that he "knew or had any intention of leaving the United States or of entering Canada." The ticket agent who sold his ticket over the route did not volunteer any explanation of where the car would go except as to the terminus, and passengers were guarded so that "they could not leave the train in Canada."
If the word, "entry," in the statute extends to the mere physical passage of an alien across the boundaries of the United States, regardless of any intent, the order was right; but, if so, an alien who is arrested or abducted, and carried against his will out of the country and then back again into it, makes an "entry." We do not understand that the Director of Immigration takes this extreme position; certainly no court has done so; the furthest stretch given to the word was in Ward v. DeBarros,[2] and even there the court, arguendo, excluded an involuntary entry. However, that is not the case at bar; DiPasquale was not carried out of, and back into, the United States against his will; he boarded a car which, had be inquired, he would have learned would take him outside the United States and back into it. *879 True, he did not know its route, but he acquiesced in whatever route the railroad might choose to pull the car; and if the factor of intent is satisfied by such an acquiescence, he made an "entry." That is what the First Circuit held in Ward v. DeBarros, supra.[2] On the other hand, if the necessary intent demands knowledge by the alien that the route which he is to take will carry him across our borders, then DiPasquale did not enter when, asleep, he came into Detroit. In Zurbrick v. Borg,[3] the Sixth Circuit held that if the alien did know this, he "entered"; and we agree. Taguchi v. Carr[4] is not in point; true, Taguchi was forced outside the United States, and it was a hard constraint that put him to the choice; but he did choose to re-enter and knew he was entering when he did. Claussen v. Day,[5] so far as it counts at all, counts in DiPasquale's favor; and these are the only decisions near enough to deserve discussion.
With deference, we cannot follow Ward v. DeBarros, supra;[6] we think that the intent of a carrier, unknown to the alien, to carry him across a border and back again, upon a route whose termini are within the United States, should not be imputed to him. Were it otherwise, the alien would be subjected without means of protecting himself to the forfeiture of privileges which may be, and often are, of the most grave importance to him. He would be charged with the duty, every time he set foot upon a public conveyance to inform himself of its projected journey. Even if aliens were adequately advised of the danger, this would be a serious, and quite useless, burden to impose upon them; but there is nothing to advise them, and the duty would in practice become a trap, whose closing upon them would have no rational relation to anything they could foresee as significant. We cannot believe that Congress meant to subject those who had acquired a residence, to the sport of chance, when the interests at stake may be so momentous.
True, DiPasquale has shown himself to be a most undesirable member of our community; more than that, there can be no doubt that if he had been convicted of his first crime after May 1, 1917, instead of in 1915, and if he had been imprisoned for a year for it, he could now be deported. The fact that he had come here as a boy, that deportation would be in substance exile, and that he was as much the product of our society as though he had been born here: all these would make no difference: the statute makes no distinction between one who came here as an adult and one who came here as a babe in arms. We could not choose but to leave him to his fate, however cruel. But concededly he was not subject to deportation except for his journey between Buffalo and Detroit; he had a vested interest in his residence, which could not be impaired so long as he avoided another conviction. That interest is now to be forfeited because of perfectly lawful conduct which he could not possibly have supposed would result in anything of the sort. Caprice in the incidence of punishment is one of the indicia of tyranny, and nothing can be more disingenuous than to say that deportation in these circumstances is not punishment. It is well that we should be free to rid ourselves of those who abuse our hospitality; but it is more important that the continued enjoyment of that hospitality once granted, shall not be subject to meaningless and irrational hazards.
Order reversed; relator discharged.
NOTES
[1] § 155, Title 8 U.S.C.A.
[2] 1 Cir., 75 F.2d 34.
[2] 1 Cir., 75 F.2d 34.
[3] 47 F.2d 690.
[4] 9 Cir., 62 F.2d 307.
[5] 279 U.S. 398, 49 S. Ct. 354, 73 L. Ed. 758.
[6] 1 Cir., 75 F.2d 34. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1691504/ | 165 S.W.3d 795 (2005)
Robert C. FARONE, Appellant,
v.
BAG'N BAGGAGE, LTD. and Caribbean Marine, Inc., Appellees.
No. 11-03-00049-CV.
Court of Appeals of Texas, Eastland.
April 21, 2005.
*797 Brett Myers, Gregory Weiss, David, Goodman & Madole, Dallas, for appellant.
Michael Abcarian, Epstein Becker Green Wickliff & Hall, Jonni Walls, M. Brenk Johnson, Winstead, Sechrest & Minick, Dallas, for appellees.
Panel consists of: ARNOT, C.J., and WRIGHT, J., and McCALL, J.
Opinion
JIM R. WRIGHT, Justice.
Bag'n Baggage, Ltd. and Caribbean Marine, Inc., appellees, successfully obtained a partial summary judgment in which the trial court held that Robert C. Farone could not recover from them in his suit for breach of an employment contract. The trial court also ruled that Farone was not entitled to recover upon his claims for breach of a stock option contract. The parties resolved other issues by agreement, and this judgment became final. We hold that the statute of frauds prohibits enforcement of any extension of the original employment agreement between the parties. We also hold that, in the absence of an express agreement extending or renewing the original two-year contract, the employment-at-will doctrine prevents recovery by Farone. Further, we hold that the alleged oral stock option agreement fails because it does not include essential terms. We affirm the judgment of the trial court.
In 1983, Caribbean Marine, Inc. (CMI), a corporation, purchased Bag'n Baggage. Bag'n Baggage was a closely held corporation at the time that CMI purchased it. On June 17, 1985, Bag'n Baggage, Inc. entered into an employment agreement with Farone whereby Farone was to serve as president of Bag'n Baggage. The employment agreement provided that it would expire after a term of 2 years beginning June 17, 1985, unless terminated earlier by Farone's death or disability or by his breach of the employment agreement as set forth in the agreement. The agreement did not contain language that addressed renewal of the agreement.
On the same date that Bag'n Baggage and Farone signed the employment agreement, they also signed an agreement granting stock options to Farone whereby Farone had the option to purchase 10 percent of the shares of Bag'n Baggage. The parties provided that the option would expire three years from the date of the agreement, unless exercised earlier. The agreement contained language that provided for expiration of the stock option agreement in the event that Farone ceased to be employed by Bag'n Baggage for any reason other than Farone's death or disability.
Farone exercised stock options equal to 5 percent of the outstanding shares of *798 Bag'n Baggage. Subsequently, CMI's board of directors voted to convert Bag'n Baggage into a partnership. Farone was a member of the board of directors of CMI at the time of the vote. CMI offered to exchange Farone's stock in Bag'n Baggage for CMI stock of equal value. Farone accepted that offer. Farone also accepted CMI's offer whereby Farone would be allowed to purchase a 1 percent limited partnership interest in the newly-formed Bag'n Baggage partnership. Farone paid $10,000 for a 1 percent interest in Bag'n Baggage, Ltd. Farone takes the position that he was concerned that he would lose his remaining stock options in Bag'n Baggage, Inc. if the conversion to a limited partnership took place. Farone also alleges that he was concerned that his 5 percent equity interest in Bag'n Baggage, Inc. would be diluted in the conversion to CMI stock. Farone claims that he related those fears to Bill Bowen, the president of CMI at the time. Farone maintains that Bowen told him that he would be compensated for the remaining stock options when Bag'n Baggage was sold or when Farone left the company. This alleged compensation agreement was not reduced to writing.
Bowen died in 1996. Patrick Sullivan replaced Bowen as president of CMI. Over a period of time, CMI's board, except for Farone, became dissatisfied with Farone's performance; and, in December 2000, they voted to discharge him. Sullivan informed Farone of the board's action on January 11, 2001.
Farone brought suit against Bag'n Baggage and CMI seeking, among other things, damages for breach of the employment contract and damages for breach of the alleged compensation contract pertaining to the stock options. Farone sought other relief in his lawsuit, but those claims have been settled by the parties and are not a part of this appeal.
Bag'n Baggage and CMI filed a motion for partial summary judgment; they state that the motion is filed under TEX.R.CIV.P. 166a(c) & 166a(i). However, the motion is couched primarily in Rule 166a(c) terminology, and we will decide the issues in this case in accordance with standards relating to Rule 166a(c).
The rules for reviewing a traditional summary judgment are well-established. The movant has the burden of showing that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law. In deciding whether there is a disputed material fact issue precluding summary judgment, evidence favorable to the non-movant will be taken as true. Every reasonable inference is indulged in favor of the non-movant, and any doubts must be resolved in favor of the non-movant. American Tobacco Company, Inc. v. Grinnell, 951 S.W.2d 420 (Tex.1997); Nixon v. Mr. Property Management Company, Inc., 690 S.W.2d 546, 548-49 (Tex.1985). Summary judgment is proper if the defendant disproves at least one element of each of the plaintiff's claims or establishes all elements of an affirmative defense to each claim. American Tobacco Company, Inc. v. Grinnell, supra; Doe v. Boys Clubs of Greater Dallas, Inc., 907 S.W.2d 472, 476-77 (Tex.1995); Montgomery v. Kennedy, 669 S.W.2d 309, 310-11 (Tex.1984). When a trial court does not specify the grounds upon which a motion for summary judgment is granted, an appellate court will affirm the judgment if any of the theories advanced are meritorious. Cincinnati Life Insurance Company v. Cates, 927 S.W.2d 623 (Tex.1996).
Farone brings seven issues in this appeal. In Farone's first and second issues, he claims that the trial court erred in granting the motion for summary judgment because his contract satisfied the statute of frauds and because he was not *799 an employee-at-will. See TEX. BUS. & COM. CODE ANN. § 26.01(b)(6) (Vernon 2002).
In response, Bag'n Baggage and CMI claim that any continuation of the original employment agreement is not enforceable under the statute of frauds. They also contend that Farone was an employee-at-will at the time that he was terminated.
The employment-at-will doctrine, generally, absent a specific agreement otherwise, provides that an employer may terminate an employee for good cause, bad cause, or no cause at all. Montgomery County Hospital District v. Brown, 965 S.W.2d 501 (Tex.1998). Employment-at-will status is presumed. Montgomery County Hospital District v. Brown, supra at 502. In order for an employee to avoid the effects of the employee-at-will doctrine, he must show that the employer unequivocally expressed its intent to be bound not to terminate the employment except under clearly specified circumstances or conditions. Midland Judicial District Community Supervision and Corrections Department v. Jones, 92 S.W.3d 486, 488 (Tex.2002).
The employment contract between the parties is a part of the summary judgment evidence. In Paragraphs 2 and 5 of the contract, the parties provided:
2. Term of Employment.
(a) Employment of Farone hereunder shall be effective on the date of this Agreement and shall continue in effect, subject to earlier termination pursuant to paragraph 2(b) hereof, for a term of 24 months from June 17, 1985.
(b) The foregoing notwithstanding, this Agreement shall terminate upon the earlier to occur of the following:
(i) the death or permanent disability of Farone; or
(ii) the breach of this Agreement by Farone as described in paragraph 5 hereof.
5. Breach by Farone.
(a) In the event Farone materially breaches this Agreement, Bag `N Baggage may terminate this Agreement effective thirty (30) days after Company gives written notice of such termination to Farone, provided that Company shall pay to Farone all compensation accrued under this Agreement to the date of such termination.
(b) A material breach of this Agreement by Farone shall be deemed to have occurred upon the happening of any of the following:
(i) willful misconduct of Farone in the performance of Farone's duties, functions, and responsibilities;
(ii) failure of Farone to comply with any duty, function or responsibility herein undertaken by Farone;
(iii) conviction of Farone of any felony offense during the term of this Agreement;
(iv) resignation or voluntary retirement of Farone from employment; or
(v) any other conduct or failure to perform hereunder by Farone which the Board of Directors in good faith determines to be detrimental to Company.
TEX. BUS. & COM. CODE ANN. § 26.01(a) (Vernon 2002)(statute of frauds) contains the requirement that certain promises and agreements are not enforceable unless the promise or agreement, or a memorandum of the promise or agreement, is in writing and signed by the party to be charged with the promise or agreement or by someone who is lawfully authorized to sign for him. Section 26.01(b)(6) provides that agreements which are not to be performed within one year from the date of making the agreement are covered by Section 26.01(a).
*800 The original term of Farone's employment agreement was for a period of two years. Although Farone continued to be employed as president of Bag'n Baggage after the initial two-year term, the parties did not enter into additional written employment contracts after the expiration of the initial two-year term. We must decide at the outset whether an employment contract which is originally subject to the statute of frauds can be renewed and extended by implication and enforced as originally written or does the statute of frauds prevent such an implied renewal and extension of contracts that originally could not have been performed within a period of one year.
Performance of an agreement must be possible within one year or the contract will fall within the provisions of the statute of frauds. Schroeder v. Texas Iron Works, Inc., 813 S.W.2d 483, 489 (Tex.1991). Here, the contract provided that the agreement was for a period of two years unless terminated earlier by Farone's death or permanent disability or upon the occurrence of certain performance failures attributable to Farone as set forth in the agreement. While the original contract called for termination by death, disability, or performance failures, those events are methods of termination. Those events do not constitute performance of the contract; they constitute excusable nonperformance of the contract. Montgomery County Hospital District v. Brown, supra at 505 (citing Collins v. Allied Pharmacy Management, Inc., 871 S.W.2d 929, 934 (Tex.App.-Houston [14th Dist.] 1994, no writ)). We hold that the original contract falls under the statute of frauds.
For purposes of this appeal, we will assume, without deciding, that Bag'n Baggage unequivocally expressed its intent to be bound not to terminate Farone's employment for an initial period of two years, except under clearly identified circumstances as set forth in Paragraph 5 of the agreement. See Midland Judicial District Community Supervision and Corrections Department v. Jones, supra. The question then becomes whether the agreement was continued by implication after the expiration of the initial two-year term. We hold that it was not because there were no successive agreements in writing as required by the Statute of Frauds. TEX. BUS. & COM. CODE ANN. § 26.01 (Vernon 2002).
All of the cases which have been cited to this court by Farone concern cases that do not fall within the statute of frauds and are held to be extended or renewed by implication. Farone cites the following distinguishable cases for the proposition that this case is not within the statute of frauds: Fenno v. Jacobe, 657 S.W.2d 844, 847 (Tex.App.-Houston [1st Dist.] 1983, writ ref'd n.r.e.)(the original agreement was for a term of one year and the court there held that the contract was impliedly extended when the employee continued to work under the same circumstances); Thames v. Rotary Engineering Company, 315 S.W.2d 589, 591 (Tex.Civ.App.-El Paso 1958, writ ref'd n.r.e.)(lawsuit dealt with noncompetition agreements; case did not involve the statute of frauds; each monthly pay period constituted a monthly extension of the original agreement); Montgomery County Hospital District v. Brown, supra at 503 (case did not involve the statute of frauds; court held that alleged oral promises modifying employment-at-will were not definite enough to do so); Hardison v. A.H. Belo Corp., 247 S.W.2d 167, 168-69 (Tex.Civ.App.-Dallas 1952, no writ)(involved oral contract to employ for as long as employer was satisfied; statute of frauds does not apply in "satisfaction" type contracts because contract could be performed within one year); Stone v. Griffin Communications and Security Systems, Inc., 53 S.W.3d 687 (Tex.App.-Tyler 2001, *801 no pet'n)(if situation is actually an employment-at-will situation, then an employer can terminate at any time without cause; but, in "satisfaction" type contract, there must be a bona fide dissatisfaction or cause for discharge; statute of frauds not addressed); Sadowski v. Dell Computer Corporation, 268 F. Supp. 2d 129, 135-36 (D.Conn.2003)(case involved stock options and maturity of those options upon disability; statute of frauds not addressed, but, court addressed good faith and reasonableness requirements when dealing with a "satisfaction" type employment contract). The agreement before us could be terminated for stated causes; but the original contract term for performance was for a period of two years, it was not for so long as the employer was satisfied. The contract in this case is not a "satisfaction" contract.
The original contract could not be performed within one year. Any implied renewal of the contract, therefore, could not be performed within one year. The statute of frauds requires that those agreements are not enforceable unless the promise or agreement, or a memorandum of the promise or agreement, is in writing and signed by the party to be charged with the promise or agreement or by someone who is lawfully authorized to sign for him. Section 26.01(b)(6).
Here, there may have been implied agreements to continue the original contract; but, without a further writing during each period of extension of the original two year agreement, any subsequent agreements are not enforceable. Because they are not enforceable, Farone was an employee-at-will. Because Farone was an employee-at-will, Bag'n Baggage could terminate him at will for good cause, bad cause, or no cause at all. Midland Judicial District Community Supervision and Corrections Department v. Jones, supra. Farone's first and second issues on appeal are overruled. In view of our ruling on those two issues, we need not consider Farone's third issue on appeal. TEX.R.APP.P. 47.1.
Farone directs his fourth, fifth, and sixth issues on appeal to questions involving stock options for which Farone seeks compensation. At the time that Bag'n Baggage was converted from a corporation into a limited partnership, Farone held an unexercised option to purchase an additional five percent of the stock of Bag'n Baggage. Bowen had approached Farone in an attempt to obtain Farone's approval of the change to the limited partnership. Farone was to convert his Bag'n Baggage stock into stock of equal value in CMI, and, he was also to buy a one percent interest in the new limited partnership for $10,000. Those transactions happened. Being concerned about the dilution of the value of his Bag'n Baggage stock, Farone approached Bowen to discuss his unexercised options he held for an additional five percent of the stock of Bag'n Baggage. The summary judgment evidence shows that at that time Bowen stated merely that Farone would be "compensated" at the time that Bag'n Baggage was sold or at the time that Farone left the company. There were no other discussions about this "compensation."
Farone maintains that the statement to him that he would be "compensated" is enough to create an enforceable contract. Appellees maintain that the oral agreement is not specific enough to create a contract.
In general, a contract is legally binding only if its terms are sufficiently definite to enable a court to understand the parties' obligations. Fort Worth Independent School District v. City of Fort Worth, 22 S.W.3d 831, 846 (Tex.2000). If an essential term is left open for negotiation in the future, there is no contract. *802 T.O. Stanley Boot Co., Inc. v. Bank of El Paso, 847 S.W.2d 218, 221 (Tex.1992). The terms of an oral contract must be definite, certain, and clear as to all essential terms; or the contract will fail for indefiniteness. Meru v. Huerta, 136 S.W.3d 383, 390 (Tex.App.-Corpus Christi 2004, no pet'n). Although Texas courts favor validating contracts, courts may not create a contract where there is none. Kelly v. Rio Grande Computerland Group, 128 S.W.3d 759, 766 (Tex.App.-El Paso 2004, no pet'n).
There is no contract between Farone and appellees. The only summary judgment evidence in this record is that Farone had a conversation with Bowen before Bowen died in which Bowen told Farone that he would be "compensated" for his unexercised stock options for Bag'n Baggage, Inc. stock. There is no summary judgment evidence of anything else relating to the "compensation" which Farone was to receive. Essential terms are missing: such as price; whether the method of payment would be in cash or in an equity interest; and if in an equity interest, the method of compilation of value; and whether the equity interest would come from CMI or Bag'n Baggage, Ltd. These are just some of the essential terms upon which there is no agreement. The contract is not definite, certain, and clear as to essential terms; and it fails for indefiniteness. Meru v. Huerta, supra. Farone's fourth and fifth issues on appeal are overruled. Because Farone's fourth and fifth issues on appeal are overruled, we need not consider his sixth issue on appeal. Rule 47.1.
In his seventh issue on appeal, Farone asserts that appellees failed to point out the elements to which there is no evidence. See Rule 166a(i). We specifically have not based our decision upon Rule 166a(i) and do not need to address this issue on appeal.
After reviewing the summary judgment evidence, taking as true all evidence favorable to Farone, indulging every reasonable inference in his favor, and resolving any doubts in his favor, we hold that the trial court did not err when it granted appellees' motion for summary judgment. The judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3107244/ | NUMBER 13-10-00012-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI - EDINBURG
____________________________________________________________
ANA LISA AYALA, Appellant,
v.
THE STATE OF TEXAS, Appellee.
____________________________________________________________
On appeal from the 206th District Court
of Hidalgo County, Texas.
____________________________________________________________
MEMORANDUM OPINION
Before Chief Justice Valdez and Justices Rodriguez and Benavides
Memorandum Opinion Per Curiam
Appellant, Ana Lisa Ayala, by and through her attorney, has filed a motion to
withdraw her appeal because she no longer desires to prosecute it. See TEX. R. APP.
P. 42.2(a). Without passing on the merits of the case, we grant the motion to withdraw
the appeal and pursuant to Texas Rule of Appellate Procedure 42.2(a), dismiss the
appeal. Having dismissed the appeal at appellant's request, no motion for rehearing will
be entertained, and our mandate will issue forthwith.
PER CURIAM
Do not publish.
See TEX. R. APP. P. 47.2(b).
Delivered and filed the
24th day of March, 2011.
2 | 01-03-2023 | 10-16-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/3962245/ | Conviction for theft; punishment, two years in the penitentiary.
There are no bills of exception in the record. The facts sufficiently show that appellant was outside of a store and keeping the motor of the car running while other negroes, who had come to the place with him, entered the store and took therefrom property of the value of more than fifty dollars. The one who took the suits of clothes ran with them to the door and out to the car in which appellant was. He threw the clothes into the car, but was so closely pursued by parties from the store that he took the clothes out of the car and handed them to the owner. Appellant drove rapidly away from the scene, but was arrested later. We think the facts sufficient to show an acting together of the parties in such a way as to make appellant guilty of the theft of the clothes. We find *Page 349
no brief on file for the appellant. There were no exceptions to the charge of the court.
Finding no error in the record, the judgment is affirmed.
Affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1634271/ | 490 S.W.2d 941 (1973)
J. WEINGARTEN, INC., Appellant,
v.
Rachel SANDEFER, Appellee.
No. 7442.
Court of Civil Appeals of Texas, Beaumont.
February 15, 1973.
*942 Orgain, Bell & Tucker, Beaumont, for appellant.
Seale & Stover, Jasper, for appellee.
KEITH, Justice.
Although subject to the Workmen's Compensation Laws, defendant was not a *943 subscriber and did not carry Workmen's Compensation Insurance. Plaintiff sustained injuries in the course of her employment with defendant and brought suit to recover her damages, alleging negligence on the part of the defendant which proximately caused her injury. § 1, Art. 8306, Vernon's Ann.Civ.St. Based upon the jury verdict, the trial court rendered judgment for plaintiff and this appeal follows.
Defendant operated a supermarket and plaintiff was employed as a clerk in the non-food department thereof. She had been so employed for approximately three years before the date of her injury. One of her duties was to stock the shelves of her department with merchandise which she would procure from the storage area. On the occasion in question she was engaged in restocking display shelves with drinking glasses and had two of the glasses for which there was no room on the display shelves. There was an area below the bottom shelf known as an "understocking" area where such surplus merchandise was kept until needed upon the display shelves. Plaintiff said: "I just squat down to put them [the two glasses] under the counter [when] ... My knee popped." She says that she made a complete knee bend in her effort to place the glasses in the storage area and that she knew of no other way in which such could be accomplished.
Upon cross-examination, Mrs. Sandefer testified that she was "a strong, able bodied" female for a person of her age, 42 years; that she had done this particular type of work for about three years before her injury, was familiar with the routine of the job; that she had been stooping, bending, had done some lifting, and some squatting in the course of her work for the defendantjust as she had done in connection with her housework. She testified that when her knee popped, "it was a surprise"; that she was squatting like she had done a number of times. She had never hurt herself before in doing such work. The reason for placing the surplus glasses under the counter was to enable her to restock the shelves without going back to the supply room.
The employer had given her no instructions as to the manner in which she was to bend, stoop, or squat in doing her work and that she could do it the way she felt like doing it.
Other than stipulations of the parties and the introduction of a medical report by agreement, no other witnesses were offered and the defendant rested with plaintiff. We now summarize the several issues upon which the judgment was based:
No. 1. Defendant failed "to furnish employees to handle the stocking of the merchandise which was to be sold by the plaintiff," which was negligence proximately causing her injury.
No. 4. Defendant "required stock to be `understocked' in shelves beneath the sales shelves, rather than having employees bring the stock from the stock room as the shelves were emptied of a particular item," which was negligence proximately causing her injury.
No. 7. Defendant "required stock to be `understocked' in shelves which were so close to the floor as to constitute a dangerous condition when the plaintiff was forced to squat down to place stock in such shelves," which was negligence and a proximate cause of her injury.
No. 10. Defendant "failed to furnish a sufficient number of shelves so that the merchandise could be stocked and displayed at a reasonable height from the floor," which was found to be a proximate cause of her injury.[*]
In replying to defendant's contentions that the trial court erred in overruling its *944 motion for peremptory instruction, plaintiff advances several propositions of law which we accept at the outset of our discussion in order to put the case in proper perspective:
1. The employer had a continuing nondelegable duty to provide and maintain a reasonably safe place for plaintiff to work. Leadon v. Kimbrough Brothers Lumber Company, 484 S.W.2d 567, 568 (Tex.1972), is probably the latest authoritative case so holding.
2. The employer has a duty to furnish the employee with safe and suitable appliances so that he may carry on the work with reasonable safety; but, the master is not an insurer. Peck v. Peck, 99 Tex. 10, 87 S.W. 248 (1905); Fort Worth Elevators Co. v. Russell, 123 Tex. 128, 70 S.W.2d 397, 401 (Tex.1934); Prunty v. Bland, 454 S.W.2d 881, 884 (Tex.Civ.App., Houston1st Dist., 1970, error ref. n. r. e.).
3. The employer had the duty to exercise ordinary care to select careful and competent fellow servants or coemployees. Fort Worth Elevators Case, supra; Western Union Telegraph Co. v. Coker, 146 Tex. 190, 204 S.W.2d 977, 978 (1947); Holiday Lodge Nursing Home, Inc. v. Huffman, 430 S.W.2d 826, 828 (Tex.Civ.App., Texarkana, 1968, no writ).
4. And, the employer had the duty to establish and enforce safety rules in order that the employee may perform assigned duties with reasonable safety. Fort Worth Elevators Case, supra; J. Weingarten, Inc. v. Moore, 449 S.W.2d 452, 453 (Tex.1970).
Each of the rules so stated is soundly entrenched in our jurisprudence and we accept each without hesitation. And, we would be remiss, in view of our disposition of this case, not to point out at this time that in considering the no evidence points of the defendant we do so under the rule announced in Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965). Thus we consider only the evidence and the inferences tending to support the findings and disregard all evidence and inferences to the contrary.
The defendant, as a nonsubscriber, was deprived of certain defenses in this action; but, it was still necessary for the plaintiff, if she was to recover, to prove actionable negligence on the part of the defendant which proximately caused her injuries. Western Union Telegraph Co. v. Coker, supra (204 S.W.2d at 978); Najera v. Great Atlantic & Pacific Tea Co., 146 Tex. 367, 207 S.W.2d 365, 366 (1948). Or, as was said in Coleman v. Hudson Gas and Oil Corporation, 455 S.W.2d 701, 702 (Tex.1970), "Any plaintiff must prove the existence and violation of a legal duty owed to him by the defendant in order to establish tort liability."
Judge Critz restated several of the horn-book definitions of negligence, applicable in the case of nonsubscribers such as we have here, in the case of Great Atlantic & Pacific Tea Co. v. Evans, 142 Tex. 1, 175 S.W.2d 249, 251 (1943). Evans, "a strong, robust young man," was not allowed to recover for the hernia he sustained while carrying sacks of potatoes. "He was merely required to perform work that he had been doing for this same employer for several months before this occasion." Thus, the record did not support a finding of actionable negligence and, "the facts of this record fail, as a matter of law, to show that A. & P. ought to have foreseen that Evans would be injured by doing the character of work required of him in this instance." (175 S.W.2d at 251)
The late Judge Hutcheson quoted liberally from Evans and Coker in the well-reasoned case of Sears, Roebuck & Company v. Talley, (5th Cir., 1956), 239 F.2d 82, 84-85, where an experienced employee was denied a recovery for a knee injury sustained while carrying a freezer. This was followed in Collins v. Singer Sewing Machine Company, (5th Cir., 1957), 239 *945 F.2d 705, 706, where a mature and experienced employee strained his back while carrying a sewing machine up steep stairs and was denied a recovery.
Plaintiff has not brought forward any evidence upon which the jury's answers to the first negligence issue can be based. With two drinking glasses in her hand and the task being to place them on a shelf near the floor, it is, indeed, difficult to perceive any reason why the employer owed a duty to her to furnish other additional employees to "handle the stocking of the merchandise." Mrs. Sandefer was hired to do just that and had been doing it without difficulty or complaint for several years. She knew the requirements of her job and her own strength as well as anyone, including the employer. She did not perceive of any reason to call for assistance and is hard put to show that her employer should have seen the necessity for assistance in this case.
Granted that the employer had directed that the surplus glasses be placed in the low area, such gives no rise to a claim of negligence. In Gulf, Colorado & Santa Fe Ry. Co. v. Waterhouse, 223 S.W.2d 654, 659 (Tex.Civ.App., Beaumont, 1949, error ref. n. r. e.), the court said:
"Doubtless many orders by the master expose the servant to some risk of harm; but whether the master is negligent in ordering his servant to perform a task depends upon whether he ought to realize that the order exposes the servant to an unreasonable risk of harm." (emphasis in the original)
Although we have searched diligently, we can find no evidence in our record which supports the first cluster of issues. If she could not foresee the possibility of injuryand she was surprised when injury occurredit cannot be said that there is any reasonable inference that the employer should have foreseen that she would hurt herself. Armstrong v. Missouri-Kansas-Texas-R. Co. of Texas, 233 S.W.2d 942, 946 (Tex.Civ.App., Dallas, 1950, error ref. n. r. e., cert. den. 342 U.S. 837, 72 S. Ct. 62, 96 L. Ed. 633; Shumake v. Great Atlantic & Pacific Tea Co., 255 S.W.2d 949, 951 (Tex.Civ.App., Dallas, 1953, error ref. n. r. e.); Masso v. Stansbury, 399 S.W.2d 396, 399 (Tex.Civ.App., Amarillo, 1966, error ref. n. r. e.), which quotes liberally from Evans, supra.
In Western Union Telegraph Co. v. Coker, supra, the Court quoted from Labatt's Master and Servant, 2d Ed., Vol. 3, pp. 2912-2915, § 1107:
"`So far as the movements of servants may depend upon their own volition, and are not in any way affected by the control of a superior, it is clear that there can be no recovery on the theory that the number of servants was temporarily inadequate at the time and place where the injury was received, unless it is shown that such inadequacy was known, actually or constructively, to the master or his representative.'" (204 S.W.2d at 978, 979)
Far from showing any such knowledge, plaintiff can point to no evidence in this record which would show that any reasonable person, including herself, who even dreamed that other or additional employees were required to assist her or, for that matter, what sex, age, and physical characteristics would be required of such assistants. The same rule negates a finding of proximate cause. Shumake v. Great Atlantic & Pacific Tea Co., supra, 255 S.W.2d at 951.
When we turn to a consideration of the other series of issues, we find no evidence, by custom or otherwise, which would lead to an inference of negligence on the part of the storekeeper in arranging shelves all the way to the floor. Plaintiff made no effort to prove custom and usage as was done in Leadon v. Kimbrough Brothers Lumber Company, supra, 484 S. W.2d at 569, nor was there a shred of evidence upon which the jury could have based their answers to the last three clusters of issues which we have summarized.
*946 Plaintiff does, however, point to her testimony elicited in response to leading questions, that defendant has altered its procedure so that "there are no shelves under the display shelves" and "[t]here is no understock of the shelves" so that items which will not go on the display shelves must now be returned to the store room. Such testimony is generally considered to be inadmissible if offered for the purpose of showing negligence. Roosth & Genecov Production Co. v. White, 152 Tex. 619, 262 S.W.2d 99, 104 (1953); 2 McCormick & Ray, Texas Law of Evidence (2d Ed), § 1151, p. 42 (1956); L. Temple, "Admissibility of Evidence of Subsequent Safety Measures," 37 Tex.L.Rev. 478 (1959).
This testimony, received without objection, does not alter our view of the case. There being no evidence tending to show that the conditions existing at the time of the accident were either negligently constructed, maintained, or used, the evidence of a change did not turn a non-negligent condition into one of actionable negligence. For aught that appears, defendant may have simply rearranged the store as a housewife frequently rearranges her furniture. Neither method of doing business shows any failure to exercise ordinary care.
We repeat, after a careful review of this record, we find no evidence of actionable negligence on the part of the defendant which proximately caused injury to the plaintiff. Mrs. Sandefer did no more on the occasion in question than she had done theretofore many times without mishap; there is no evidence that the work required of her was dangerous or that her employer should have anticipated any injury from the task assigned. There is not in this case even the "glimmer of evidence to support the plaintiff's position." Seideneck v. Cal Bayreuther Associates, 451 S.W.2d 752, 755 (Tex.1970). Thus, the case falls within the rule announced in Joske v. Irvine, 91 Tex. 574, 44 S.W. 1059 (1898), to the effect that when the evidence offered to prove a vital fact is so weak as to do no more than create a mere surmise or suspicion of its existence, such evidence is in legal effect no evidence, and it will not support a verdict or judgment.
We sustain defendant's points 2, 5, 7, 9, 11, 13, 15, 17, 19, 21, and 23. This action renders it unnecessary that we consider the remaining points brought forward by defendant.
The judgment of the trial court is now reversed and judgment rendered for defendant.
NOTES
[*] Reasonable height was defined to mean "the height at which a reasonably prudent employer, in the exercise of ordinary care under the same or similar circumstances, would have stocked and displayed the merchandise." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1690488/ | 709 So. 2d 277 (1998)
Kenneth J. DEVILLIER, et al. Plaintiffs-Appellants,
v.
FIDELITY & DEPOSIT COMPANY OF MARYLAND, et al. Defendants-Appellees.
No. 97-1200.
Court of Appeal of Louisiana, Third Circuit.
March 6, 1998.
*278 Robert G. Nida, Alexandria, for Kenneth J. Devillier, et al.
Maura Zivalich Pelleteri, Eugene R. Preaus, New Orleans, for Fidelity & Deposit Company of Maryland.
Thomas Edward Loehn, Jedd Malish, New Orleans, for Fidelity & Deposit Co. of Md. Gen. Liab. Carrier.
David Ramsey Lestage, DeRedder, for City Savings Bank & Trust Co., et al.
George Bartlett Hall, Jr., David M. Korn, New Orleans, for Trinity Universal Ins. Co.
James A. Bolen, Jr., Alexandria, for City Sav. Bank, et al. on Behalf of Trinity Univ.
Before DECUIR, AMY and PICKETT, JJ.
DECUIR, Judge.
Plaintiffs, Kenneth J. Devilllier, Joy M. Lindsay, Eveline D. Nash, Bobbie C. Shirley, and Mary Ernestine Hillman, all former employees of City Savings Bank And Trust Company (CSB), filed suit seeking damages, attorney's fees and punitive damages, as well as injunctive relief, against CSB, its president, Glen Bertrand, individual members of the Board of Directors of CSB, Fidelity & Deposit Company of Maryland (F & D), the directors' and officers' liability insurer and general liability insurer of CSB, and Trinity Universal Insurance Company (Trinity), also general liability insurer of CSB.
Plaintiffs allege that during 1992 and 1994, defendant Bertrand engaged in threatening, hostile, and humiliating treatment of female employees and retaliation against the plaintiffs for opposing Bertrand's allegedly abusive behavior. Specifically, plaintiffs contend that Bertrand's abusive conduct constitutes violations of the Louisiana Commission on Human Rights Act (LCHRA), La.R.S. 51:2231, et seq., prohibiting discrimination because of age and sex and retaliation for opposing illegal employment practices. Plaintiffs further contend that Bertrand's conduct constitutes negligent and/or intentional infliction of mental distress. Additionally, plaintiffs allege that Bertrand's tortious conduct was motivated by an active desire to cause mental anguish and distress, and Bertrand believed with substantial certainty that mental anguish and distress would result from his conduct towards plaintiffs.
As to the Board of Directors, plaintiffs contend that the Board was negligent: (1) in hiring Bertrand and in failing to thoroughly and properly investigate Bertrand's background and reputation; (2) in failing to take immediate and appropriate action to terminate Bertrand's conduct after having been informed of same; and (3) in failing to insure that Bertrand would not retaliate against plaintiffs for opposing Bertrand's practices. Plaintiffs also allege that CSB is obligated under its charter and/or bylaws to indemnify the defendant directors for any amounts they may be legally obligated to pay as a result of the claims asserted by plaintiffs. Finally, plaintiffs allege that the defendant Bank and *279 the Board are vicariously liable for the acts of Glen Bertrand under the doctrine of respondeat superior.
A number of peremptory exceptions and motions for summary judgment were filed by defendants on a variety of issues, and three separate judgments were rendered.
A judgment rendered on April 3, 1997, granted the motion for summary judgment on behalf of F & D in its capacity as the comprehensive general liability insurer of CSB.
By judgment rendered April 11, 1997, the trial court sustained in part and denied in part the peremptory exception of no cause of action filed by Trinity. Specifically, the trial court sustained the exception: (1) as to plaintiffs' claims against defendant Bertrand individually for violation of La. R.S. 51:2231, et seq.; (2) as to plaintiffs' claims for negligent infliction of emotional distress; (3) as to plaintiffs' claims against the individual members of the Board of Directors; (4) as to plaintiffs' allegations of negligent hiring and retention of defendant Bertrand against the Board and CSB; and (5) as to plaintiffs' demand for punitive damages. The trial court denied Trinity's exception in part ruling that: (1) plaintiffs' petition states a cause of action for intentional infliction of emotional distress against Bertrand individually; (2) plaintiffs' petition states a cause of action for retaliation against CSB; and (3) plaintiffs' petition states a cause of action for sex discrimination against CSB.
The judgment of April 11, 1997, also granted in part and denied in part the motion for summary judgment filed by F & D on its directors' and officers' liability policy (D & O policy). Specifically, the trial court granted the motion ruling: (1) that the D & O policy does not provide coverage for any claim against the directors and officers of CSB committed or alleged to have been committed prior to September 29, 1993; (2) that the D & O policy does not provide coverage for the vicarious liability of CSB; and (3) dismissing plaintiffs' claims for attorney's fees and for punitive damages. The motion for summary judgment by F & D was denied in part, the trial court ruling that the "insured v. insured" exclusion and the "bodily injury" exclusion were inapplicable.
By the judgment of June 23, 1997, the trial court granted Trinity's motion for summary judgment finding that Trinity's comprehensive general liability policies do not provide coverage for the claims asserted by plaintiff.
Thus, remaining are plaintiffs' causes of action against CSB under La.R.S. 51:2231, et seq., and against defendant Bertrand and CSB for intentional infliction of emotional distress.
Plaintiffs appeal contending that the trial court erred: (1) in finding that only employers are liable for harassment or discrimination and retaliation, and that Glen Bertrand is not an "employer" under La.R.S. 51:2231, et seq.; (2) in finding that neither F & D's nor Trinity's comprehensive general liability policies provide coverage for plaintiffs' claims; (3) in pretermitting the question as to whether F & D's directors' and officers' liability policy provides coverage for attorney's fees; and (4) in finding that punitive damages are unavailable under La.R.S. 51:2231, et seq.
"Employer" Under La.R.S. 51:2232(4)
The trial court ruled that defendant Bertrand is not an "employer" as defined in La.R.S. 51:2232(4)[1] and dismissed plaintiffs' claims against Bertrand in his individual capacity for violation of the LCHRA, established by La.R.S. 51:2231, et seq. The stated purpose of the enactment of the LCHRA is set forth in La.R.S. 51:2231(A) in pertinent part as follows:
A. It is the purpose and intent of the legislature by this enactment to provide for execution within Louisiana of the policies embodied in the Federal Civil Rights Act of 1964, 1968, and 1972 and the Age Discrimination in Employment Act of 1967...
The term "employer" is defined in Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e(b), et seq. as "a person engaged in an industry affecting commerce ... and any agent of such person ..." (Emphasis added.)
*280 La.R.S. 51:2232(4) defines "employer" as follows:
(4) "Employer" means the state or any of its political subdivisions, any person employing eight or more persons within the state, or any person acting as an agent of an employer, directly or indirectly.
(Emphasis added.)
The trial court in written reasons recognized that the LCHRA "closely tracks the Federal Civil Rights Act of 1964, 1968, and 1972," and concluded from federal jurisprudence that the individual employee charged with discriminatory actions is not individually liable. The trial court concluded that the "agent" provision in the LCHRA was to incorporate respondeat superior liability under La.R.S. 51:2232(4), as it is in Title VII of the Civil Rights Act.
Plaintiffs argue that the definitions of "employer" in the federal and state statutes vary, and the state definition should be construed more broadly. Plaintiffs also contend that supervisory employees who have the attributes of an employer such as the power to hire and fire are considered employers under Title VII. Specifically, they argue that because defendant Bertrand was responsible for personnel or human resources and had the power to hire and fire and other attributes of an employer, he is subject individually to suit as an "employer" under the LCHRA.
We commence our discussion by noting that when interpreting our own law, it is appropriate to consider interpretations of similar federal statutes. Craven v. Universal Life Ins. Co., 95-1168 (La.App. 3 Cir. 3/6/96); 670 So. 2d 1358, writ denied, 96-1332 (La.9/27/96); 679 So. 2d 1355; Polk v. Pollard, 539 So. 2d 675 (La.App. 3 Cir.1989). In Sims v. Brown & Root, 889 F. Supp. 920 (W.D.La.1995), affirmed, 78 F.3d 581 (5th Cir.1996), cert. denied, ___ U.S. ___, 117 S. Ct. 68, 136 L. Ed. 2d 29 (1996), the plaintiff brought a sexual harassment claim under Title VII and La.R.S. 51:2231, et seq., against her employer Brown & Root and Frank Brossett, a project manager for Brown & Root. Sims interviewed with Brossett for her job at Brown & Root. One of Sims' allegations was that because she declined Brossett's sexual advances, he reduced her pay. The court in Sims referring to La.R.S. 51:2231, stated:
... This statutory scheme is a "mirror image" of Title VII. See Fishel v. Farley, 1994 WL 90325 (E.D.La.1994); see also Bennett v. Corroon & Black Corp., 517 So. 2d 1245 (La.App. 4th Cir.1987), writ denied, 520 So. 2d 425 (La.1988). Thus, in addressing Sims' Title VII claim, this court is also deciding Sims' state law sexual harassment allegation.
Id. at 925, Footnote 3.
Our own federal appellate court has held in Grant v. Lone Star Co., 21 F.3d 649, 653 (5th Cir.1994), cert. denied, 513 U.S. 1015, 115 S. Ct. 574, 130 L. Ed. 2d 491 (1994) that Title VII liability does not attach to defendants in their individual capacity. The court in Grant found that plaintiff in that case failed to offer any persuasive argument why Congress would not have intended to protect private employees as well as public employees "from individual Title VII liability," noting that "presumably private employees still could be liable for violations of state tort and contract law, such as intentional infliction of emotional distress."[2]
Furthermore, the court in Grant cites with approval Miller v. Maxwell's Int'l Inc., 991 F.2d 583 (9th Cir.1993), cert. denied, 510 U.S. 1109, 114 S. Ct. 1049, 127 L. Ed. 2d 372 (1994), wherein the Ninth Circuit Court of Appeals rejected plaintiff's claim under Title VII against defendants personally stating that Congress assessed civil liability only against an employer under Title VII. The court rejected the notion that supervisory personnel and other agents of the employer are themselves employers for purposes of Title VII liability. Furthermore, the court in Miller observed that the purpose of the "agent" provision was to incorporate respondeat superior liability into Title VII, and found no reason to extend the liability of individual employees beyond the respondeat superior principle intended by Congress.
*281 Likewise, the purpose of the "agent" provision in the LCHRA was to incorporate respondeat superior. We note that the Fifth Circuit in Grant also cites the language in Miller that Title VII contemplates liability for the employer who has the ability to discipline the employee or agent. Neither our state legislature nor Congress intended to include liability for individual employees under Title VII or LCHRA.
We conclude that the trial court was correct in finding that the plaintiffs failed to state a cause of action against defendants Bertrand and the individual members of the Board of Directors for violation of the LCHRA. Any liability incurred as a result of Bertrand's alleged actions was incurred in his capacity as "agent" of CSB which, if plaintiffs' allegations prove true, would be liable for its agent's actions as well as the actions of the Board under the doctrine of respondeat superior.
Coverage Under the General Liability Policies of F & D and Trinity
Plaintiffs advance several arguments under their assignment of error that the trial court erred in finding that neither the comprehensive general liability policies of F & D nor Trinity provide coverage for plaintiffs' claims.
First, plaintiffs contend that F & D did not submit an affidavit or evidence to identify which general liability policy was issued to CSB and there was not competent evidence submitted by F & D in this regard for the purposes of summary judgment. Plaintiffs in brief allege that F & D attached to its memorandum in support of its motion for summary judgment a comprehensive general liability policy providing coverage to CSB for the period July 1, 1994 to July 1, 1995. Plaintiffs contend that policy did not contain an "Employment-Related Practices Exclusion" and that F & D subsequently filed another memorandum attaching thereto a different policy containing an "Employment-Related Practices Exclusion." Plaintiffs argue that the trial court relied upon this exclusion in finding no coverage under the F & D policy, and that a material issue of fact exists as to the identity of the general liability policy issued by F & D to CSB.
Initially, we note that plaintiffs have failed to include a reference to the place in the record where plaintiffs may have objected to the fact that no affidavit or sufficient evidence was presented to establish the identity of the comprehensive general liability policy issued by F & D as required by Uniform RulesCourts of Appeal, Rule 2-12.4. Nor have the plaintiffs provided a reference in the record where this issue was ever raised. Pursuant to Rule 2-12.4, this court may disregard this argument. Nevertheless, upon examination of the first policy submitted as Exhibit A by F & D in support of its motion for summary judgment, we note that the index of that policy lists the "Employment-Related Practices Exclusion." The first page of the policy includes a section which provides: "Form(s) and Endorsement(s) made a part of this policy at time of issue: See the Master Policy Index attached." The policy submitted with the supplemental memorandum does not appear to be a "different" policy as plaintiffs would have this court believe. We find plaintiffs' contention in this regard to be without merit. The "Employment-Related Practices Exclusion" provides in pertinent part:
This insurance does not apply to:
"Bodily injury" to:
(1) a person arising out of any:
(a) Refusal to employ that person;
(b) Termination of that person's employment; or
(c) Employment-related practices, policies, acts or omissions, such as coercion, demotion, evaluation, reassignment, discipline, defamation, harassment, humiliation or discrimination directed at that person ...
The policy also includes identical exclusionary language as to "personal injury." Plaintiffs do not allege ambiguity in the exclusion found in the F & D comprehensive general liability policy nor do we find any ambiguity. The dismissal of F & D in its capacity as the comprehensive general liability insurer was not erroneous.
Because we find that the trial court did not err in dismissing F & D in its capacity as *282 comprehensive general liability insurer, we need not address any further contentions as to policy language under F & D's general liability policy and address only plaintiffs' remaining arguments as to the Trinity policy.
Next, plaintiffs argue that a pattern of harassment constitutes an "occurrence" under the general liability policy; that the indemnity provisions of the By-Laws of CSB qualify as an "insured contract" under the policy issued by Trinity; that plaintiffs' damages constitute property damage under the Trinity policy; and that plaintiffs' damages for mental anguish and emotional injury constitute "personal injury" under the terms of the Trinity policy.
The policy in question provides coverage for damages due to "bodily injury" or "property damage" caused by an "occurrence." The term "occurrence" under the policy is defined as "an accident, including continuous or repeated exposure to substantially the same general harmful conditions." The issues presented in the case sub judice are identical to those before this court in Pylant v. Lofton, 626 So. 2d 83 (La.App. 3 Cir.1993), wherein this court held that the comprehensive general liability policies at issue in that case, which required that bodily injury or property damage be caused by an occurrence and which excluded coverage for intentional acts, did not require insurers to defend employers against charges of on-the-job sexual harassment. The definition of "occurrence" in the policy at issue in Pylant is almost identical to that in the instant case, i.e. "an accident, including continuous or repeated exposure to conditions, which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured."
Furthermore, this court in Pylant held that the exclusion in that policy for "intentional acts" was applicable stating "it is clear that defendant's actions were intentional and not accidental." Id. at 87-88. The "intentional act" exclusion in the case sub judice is identical to the same exclusion in the Pylant case. Plaintiffs' remaining arguments as to coverage under the general liability policies are without merit and need not be addressed. The ruling of the trial court finding no coverage under the comprehensive general liability policies of Trinity is not erroneous.
Attorney's Fees and Punitive Damages
Plaintiffs contend that the trial court erred in pretermitting the question as to whether F & D's directors' and officers' liability policy provides coverage for attorney's fees. Plaintiffs also argue that the trial court erred in finding that punitive damages are not available under La.R.S. 51:2231, et seq. The trial court stated in reasons for judgment that attorney's fees would not be allowed in the case of an intentional tort under the policy and that punitive damages are not recoverable. We agree.
We note that F & D's policy makes no mention of attorney's fees and specifically excludes coverage for "fines or penalties imposed by law, punitive or exemplary damages." La.R.S. 51:2231, et seq. allows for recovery of "actual damages," together with court costs and reasonable attorney's fees. Plaintiffs, if successful in their action under the statute, would be allowed to recover attorney's fees, but not under the F & D policy. Furthermore, attorney's fees are not recoverable unless authorized by statute or provided by contract. See General Motors Acceptance Corp. v. Meyers, 385 So. 2d 245 (La.1980); Woodmen of the World Life Ins. Society v. Hymel, 610 So. 2d 195 (La.App. 3 Cir.1992), writ denied, 612 So. 2d 103 (La. 1993).
The LCHRA does not include a provision for punitive damages. Punitive damages cannot be awarded unless authorized by statute. International Harvester Credit v. Seale, 518 So. 2d 1039 (La.1988). The trial court's rulings as to attorney's fees and punitive damages are not erroneous.
The judgments of the trial court are affirmed. Costs of appeal are assessed to plaintiffs-appellants.
AFFIRMED.
NOTES
[1] Repealed by Acts 1997, No. 1409 § 4 eff. August 1, 1997.
[2] Id. at 651, Footnote 3. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1119822/ | 63 Wash. App. 788 (1992)
822 P.2d 336
LOUANN BROWN, Individually and as Guardian, Appellant,
v.
SNOHOMISH COUNTY PHYSICIANS CORPORATION, Respondent. DEBORAH HOGSETT, Appellant,
v.
SNOHOMISH COUNTY PHYSICIANS CORPORATION, Respondent.
Nos. 27524-1-I; 27946-7-I.
The Court of Appeals of Washington, Division One.
January 21, 1992.
*789 Robert O. Dire, for appellant Brown.
Maria S. Diamond and Levinson, Friedman, Vhugen, Duggan & Bland, for appellant Hogsett.
Robert B. Willoughby and Law Office of Anderson Hunter, for respondent.
SCHOLFIELD, J.
In these consolidated cases, Louann Brown, individually and as guardian for Ray Brown, and Deborah Hogsett appeal the trial court's denial of each of their motions for summary judgment and the entry of judgments in favor of Snohomish County Physicians Corporation. We affirm.
FACTS
A. Brown v. SCPC.
On August 21, 1988, Ray Brown was injured when the bicycle he was riding was struck by an automobile driven by Michelle Rutledge. Ray Brown sustained severe head and bodily injuries and was rendered incompetent. As a result of the accident, Ray Brown incurred hospital and medical expenses in excess of $160,000. In addition, Ray Brown experienced lost wages and pain and suffering as a result of the accident. Louann Brown's (hereinafter Brown) memorandum submitted in support of summary judgment indicated that the reasonable value of Ray Brown's total damages was in excess of $1 million.
*790 Both Ray Brown and Michelle Rutledge were insured by PEMCO. Rutledge had liability coverage in the amount of $25,000, and $10,000 no-fault personal injury coverage. Ray Brown's policy provided $50,000 underinsured motorist (UIM) coverage, and $10,000 no-fault personal injury coverage. PEMCO paid these policy limits in full settlement of its obligation under third party coverage and UIM coverage.
In addition to the PEMCO coverage, Ray Brown also had a health care service contract with Snohomish County Physicians Corporation (hereinafter SCPC)[1] through his employer, Ford Co., Inc. The contract provided medical, surgical, hospital and other services to its subscribers. An exclusion in the policy stated as follows:
Coverage will be excluded for expenses incurred or services rendered, including complications thereof, for the following:
....
b. Any illness, condition or injury to the extent benefits are available to the patient under the terms of any automobile medical, automobile "no fault," or similar contract or insurance, or are available under the terms of any uninsured motorist or underinsured motorist insurance coverage, or homeowner's medical coverage.
The subrogation provision reads as follows:
a. SCPC's RIGHT TO RECOVER PAYMENTS. The benefits of this contract will be available to a patient who is injured by another party. If SCPC provides benefits under this contract for the treatment of the injury, it shall (a) be subrogated to the rights of the patient (or the patient's representative), (b) have the right to collect damages from the other party and (c) have a security interest in any damages recovered from the other party; the foregoing is to the extent of all payments made by SCPC for those benefits subject to the limitations specified in paragraph `b.' below....
b. COLLECTION BY PATIENT OR REPRESENTATIVE. If a settlement is made or a judgment is recovered that is equal to or greater than the amount of the other party's reachable assets, SCPC's subrogation right shall be limited to the excess of the amount necessary to fully compensate the patient.... If the patient receives a settlement or judgment for less than the other party's reachable assets, the patient shall be considered *791 as having been fully compensated and SCPC shall be reimbursed from the recovery for the cost of benefits provided. When reasonable legal expenses and collection costs have been incurred in recovering sums that benefit both the patient and SCPC, they shall be equitably apportioned between the patient and SCPC.
After learning of Ray Brown's applicable insurance coverage, SCPC sent a letter to his attorney, indicating that under the exclusion in its policy, a total of $70,000 would be withheld from its payment of the hospital bill. This represented, according to the letter, the $50,000 in UIM coverage and the $20,000 ($10,000 from each policy) of personal injury protection (PIP). The letter further indicated that SCPC would resume payment of medical expenses above that amount, according to its schedule of benefits.
Brown filed a declaratory judgment action against SCPC, asking the court to declare that the policy exclusion
is invalid and unenforceable as against public policy to the extent that it operates to prevent an insured from being made whole, but is valid to [the] extent it operates only to prevent a double recovery by an insured.
Brown moved for summary judgment, and SCPC cross-moved for summary judgment. The trial court, finding no issues of material fact, granted SCPC's motion.
B. Hogsett v. SCPC.
Deborah Hogsett's husband, Ross Hogsett, was fatally injured in an automobile collision on November 13, 1989. A vehicle driven by Catherine Schwartz went out of control and crossed the center line, striking Hogsett's vehicle head on. Schwartz was the driver at fault, but she was uninsured.
The Hogsetts had PIP coverage through Viking Insurance in the amount of $10,000. Viking paid the $10,000 policy limit to cover the first $10,000 in medical expenses incurred by Ross Hogsett before he died. The Hogsetts also had uninsured motorist (UM) coverage in the amount of $25,000 through Viking. The total amount of medical expenses was $34,277.13.
*792 Ross Hogsett's employer, Delta Rehabilitation Life, had a contract with SCPC for health care coverage. Hogsett submitted the remaining $24,277.13 in medical expenses to SCPC. SCPC refused to pay any of these outstanding medical expenses because the total amount of the medical expenses did not exceed the combined total of the PIP coverage and the UM coverage available to Hogsett.
The exclusion contained in the policy that Ross Hogsett's employer had with SCPC was substantially similar to that contained in Ford Co., Inc.'s policy, and read as follows:
Coverage will be excluded for expenses incurred or services rendered, including complications thereof, for the following:
....
b. Any ... injury to the extent benefits are available to the patient under the terms of any vehicle insurance policy pursuant to: (1) medical coverage, medical "no fault" coverage, Personal Injury Protection coverage, or similar medical coverage contained in said policy; and/or (2) uninsured motorist or underinsured motorist coverage contained in said policy.... For the purpose of this exclusion, benefits shall be deemed to be "available" to the patient if the patient is a named insured, comes within the policy definition of insured, or is a third-party donee beneficiary under the terms of the policy.
Because Viking had not yet tendered the UM policy limit amount of $25,000, Hogsett asked SCPC to pay the outstanding medical bills. She executed SCPC's required "Assignment Agreement", which read as follows:
I agree to reimburse SCPC for the amount they have paid when settlement or other payment is received from defendant Catherine Schwartz or defendant's insurance carrier or carriers, or other representatives to the extent that I have been fully compensated under the principles of Thiringer v. American Motors Insurance Co., 91 Wash. 2d 215, 588 P.2d 191 (1978).
....
Where, under my policy with SCPC, there is an exclusion for benefits available to me because personal injury protection, uninsured motorist, or under insured motorist coverage is available to me, should I discover that I am entitled to receive any of said benefits as a result of injuries sustained in the above-referenced accident, I hereby agree to assign said benefits to SCPC to the extent necessary to reimburse SCPC *793 in full for the amounts they have paid to me or on my behalf as a result of the above-referenced accident.
Hogsett's counsel advised SCPC of Hogsett's position that the exclusion for UM/UIM coverage was unenforceable, but that she would be willing to place the UM proceeds in an interest-bearing trust account until the issue was resolved. SCPC refused to pay the outstanding medical bills unless Hogsett would concede that the exclusion was valid and enforceable.
Hogsett filed this action for a declaratory judgment that the UM/UIM exclusion is invalid and for injunctive relief and damages. The trial court entered an order on February 11, 1991, denying Hogsett's motion for partial summary judgment. On April 5, 1991, the case was certified for immediate appeal under CR 54(b). To expedite appellate review, Hogsett's other claims were dismissed without prejudice.
AMBIGUITY OF POLICY EXCLUSION
[1] Brown and Hogsett argue that the policy language at issue is ambiguous and subject to interpretation. They further contend that the purpose of the policy exclusion is to prevent double recovery, and should not apply in either case because full compensation has not been received for the victims' injuries. An ambiguous insurance policy provision, that is, a provision that is fairly susceptible to more than one reasonable interpretation, must be construed in favor of the insured, even though the insurer may have intended a different interpretation. Morgan v. Prudential Ins. Co. of Am., 86 Wash. 2d 432, 545 P.2d 1193 (1976). Exclusions from coverage are contrary to the fundamental protective purpose of insurance, and will not be extended beyond their clear and unequivocal meaning. McDonald Indus. v. Rollins Leasing Corp., 95 Wash. 2d 909, 915, 631 P.2d 947 (1981).
Both policies exclude coverage to the extent benefits are available under any automobile medical, medical "no fault", or UIM coverage. The SCPC policy applying to Brown does not define "available". The Hogsett policy provides that *794 benefits are "deemed to be `available' to the patient if the patient is a named insured, comes within the policy definition of insured, or is a third party donee beneficiary under the terms of the policy."
[2] Drollinger v. Safeco Ins. Co. of Am., 59 Wash. App. 383, 387, 797 P.2d 540 (1990), review denied, 116 Wash. 2d 1003 (1991), in addressing the meaning of the phrase "available for the regular use" of the named insured, accepted a dictionary definition of "`capable of use ... that is accessible or may be obtained'".
That the proceeds of the applicable PEMCO coverage are available to Brown is indisputable. The proceeds have, in fact, been paid to Brown in the amount of $70,000. The position taken by SCPC that it will pay only the medical costs in excess of the $70,000 paid by PEMCO is consistent with its insurance contract. There is no ambiguity in respect to the term "available" under the circumstances of Brown's case.
The definition of "available" set forth in the policy providing coverage to Hogsett is clear and unambiguous. The coverage is available if Hogsett can make her claim against the other insurance policy as a named insured, an additional insured, or a third party beneficiary.
The Hogsetts were named insureds in the policy they purchased from Viking Insurance. The definition of "available" in the applicable SCPC policy is not capable of two or more reasonable interpretations on the issue of whether the Viking UM coverage is available to Hogsett. The medical and UM coverage available to Hogsett under their coverage with Viking is $35,000. Hogsett's total medical expenses were $34,277.13. Under a clear policy exclusion, all of the medical expenses were excluded and SCPC was, therefore, legally justified in refusing to make any payments unless Hogsett was willing to assign her rights to the PIP and UM coverage to SCPC.
*795 PUBLIC POLICY
[3, 4] Brown and Hogsett argue that the exclusions are unenforceable as against public policy. As a private contractor, an insurer is permitted to limit its liability, unless such limitation is inconsistent with public policy or some statutory provision. Mutual of Enumclaw Ins. Co. v. Wiscomb, 97 Wash. 2d 203, 643 P.2d 441 (1982). In State Farm Gen. Ins. Co. v. Emerson, 102 Wash. 2d 477, 687 P.2d 1139 (1984), the court addressed a claim that an exclusion in a homeowners policy was void as against public policy. At page 483, the court stated:
Absent prior expression of public policy from either the Legislature or prior court decisions, our inquiry as to whether the family exclusion clause clearly offends the public good must be answered in the negative. "The term `public policy,' ... embraces all acts or contracts which tend clearly to injure the public health, the public morals, the public confidence in the purity of the administration of the law, or to undermine that sense of security for individual rights, whether of personal liberty or of private property, which any citizen ought to feel." ... Such a showing has not been made here. We shall not invoke public policy to override an otherwise proper contract even though its terms may be harsh and its necessity doubtful.
(Citations omitted.)
[5] Neither Brown nor Hogsett cites any Washington decisions that have condemned the type of exclusion at issue here. In Snohomish Cy. Physicians Corp. v. Jungaro, 58 Wash. App. 579, 794 P.2d 76 (1990), this court addressed the validity of an exclusion in the SCPC contract which, so far as the public policy issue is concerned, cannot be distinguished from the exclusions involved in these consolidated cases. In Jungaro, this court rejected arguments based upon Mutual of Enumclaw Ins. Co. v. Wiscomb, 95 Wash. 2d 373, 622 P.2d 1234 (1980), adhered to on reconsideration, 97 Wash. 2d 203, 643 P.2d 441 (1982) and Britton v. Safeco Ins. Co. of Am., 104 Wash. 2d 518, 707 P.2d 125 (1985), and held that the exception did not offend public policy and was valid *796 and enforceable. We adhere to the reasoning employed and the result reached in Jungaro.
The appellants argue from Thiringer v. American Motors Ins. Co., 91 Wash. 2d 215, 588 P.2d 191 (1978) that an insurer cannot rely upon an exclusion if enforcement of the exclusion results in the insured being undercompensated for his special and general damages. Both claim they have not been fully compensated. Thiringer is not on point.
Thiringer involved an insured's right to recover general damages from a tortfeasor. The issue was whether Thiringer's insurer could successfully avoid liability to Thiringer under its PIP coverage because of its right of subrogation against any recovery from the tortfeasor. The cases before us do not deal with subrogation, which is a distinct equitable doctrine with its own characteristics. The narrow issue here is the extent of coverage provided by SCPC. In Thiringer, the insured had purchased the PIP coverage. The coverage was conceded. Here, the issue is whether coverage exists.
The Thiringer court emphasized that Thiringer had paid a premium for the PIP coverage American Motors refused to pay. Referring to the American Motors policy, the court said at page 220:
It does not provide that, if the insured recovers less than his total damages from such party, the amount recovered shall be allocated first to those losses covered by the PIP endorsement and then to other damages suffered by the insured. Such a provision, were it included, would be obviously unfair, since the insured pays a premium for the PIP coverage and has a right to expect that the payments promised under this coverage will be available to him if the amount he is able to recover from other sources, after diligent effort, is less than his general damages.
[6] In the cases before us, the premiums received by SCPC for the medical coverage are calculated based upon the underwriting impact of the exclusion. In each case, the subscriber has not paid a premium for coverage made unavailable by the exclusion. The lesson of Thiringer is that if you pay for coverage, you get it. Should the court invalidate *797 the exclusion, the result would be an extension of benefits to an SCPC insured beyond those benefits paid for by the subscriber. This would amount to a ruling that if you do not pay for the coverage, you get it anyway. This would impose the same unjust result on SCPC which the court rejected in Thiringer. Thiringer does not support the appellants' public policy arguments in these cases.
INSURANCE COMMISSIONER APPROVAL
In Snohomish Cy. Physicians Corp. v. Jungaro, supra, the court stated that under RCW 48.44.020, the Insurance Commissioner is authorized to disapprove any health care contract that is deceptive, and that the Insurance Commissioner reviewed and approved SCPC's policy. RCW 48.44.020 states in pertinent part:
(2) The commissioner may on examination, subject to the right of the health care service contractor to demand and receive a hearing under chapters 48.04 and 34.05 RCW, disapprove any contract form for any of the following grounds:
(a) If it contains or incorporates by reference any inconsistent, ambiguous or misleading clauses, or exceptions and conditions which unreasonably or deceptively affect the risk purported to be assumed in the general coverage of the contract; ....
Brown contends that, despite the statement to the contrary in Jungaro, the Insurance Commissioner has not approved the SCPC contract. Rather, Brown emphasizes that RCW 48.44.070 merely requires that health care contracts must be filed with the Commissioner.[2]
It does appear that the Insurance Commissioner has not disapproved the SCPC contract. In any event, the Insurance Commissioner's approval or disapproval, mentioned in passing in the Jungaro opinion, did no more than bolster the finding that the exclusion did not violate public policy. Similarly, here the issue of whether the exclusion is valid and enforceable would be seriously impacted only by a finding *798 that the Insurance Commissioner had disapproved the language. Neither Brown nor Hogsett so contend.
In both cases, the judgment of the trial court is affirmed.
WEBSTER, A.C.J., and FORREST, J., concur.
Review granted at 119 Wash. 2d 1002 (1992).
NOTES
[1] SCPC is a nonprofit group health care contractor.
[2] RCW 48.44.070 reads as follows: "Forms of contracts between health care service contractors and participants shall be filed with the insurance commissioner prior to use." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1119823/ | 822 P.2d 719 (1991)
110 Or.App. 281
David A. BOONE, Appellant,
v.
R.L. WRIGHT, Superintendent, Eastern Oregon Correctional Institution, Respondent.
CV 89-1059; CA A64820.
Court of Appeals of Oregon, In Banc.
Argued and Submitted January 4, 1991.
Resubmitted October 9, 1991.
Decided December 11, 1991.
Reconsideration Denied March 11, 1992.
*720 Wade P. Bettis, Jr., La Grande, argued the cause for appellant. On the brief were Jonel K. Ricker and Bettis & Ricker, P.C., La Grande.
Timothy A. Sylwester, Asst. Atty. Gen., Salem, argued the cause for respondent. With him on the brief were Dave Frohnmayer, Atty. Gen., and Virginia L. Linder, Sol. Gen., Salem.
Resubmitted in Banc October 9, 1991.
DE MUNIZ, Judge.
Petitioner filed a petition for post-conviction relief. It was dismissed on the ground that his claim was barred by the Statute of Limitations. He appeals. The issue is whether the 1989 amendment to the Post-Conviction Hearing Act ("the Act"),[1] adding a limitation period, applies to petitioner, whose conviction was entered before the amendment's effective date. We hold that the amendment applies, and we affirm.
Petitioner was convicted of burglary in the second degree. ORS 164.215. His conviction became final on May 23, 1989. At the time, ORS 138.510(2) provided that a petition for post-conviction relief "may be filed without limit in time." In August, 1989, the legislature amended that section to provide:
"A petition pursuant to [the Act] must be filed within 120 days of the following, unless the court on hearing a subsequent petition finds grounds for relief asserted which could not reasonably have been raised in the original or amended petition:
"(a) If no appeal is taken, the date the judgment or order on the conviction was entered in the register." Or. Laws 1989, ch. 1053, § 18.
The amendment became effective when the governor approved SB 284 on August 5, 1989. Or. Laws 1989, ch. 1053, §§ 19, 20. One hundred and sixty-five days later, on January 17, 1990, petitioner filed for post-conviction relief.[2] The post-conviction court dismissed the petition as untimely.
Petitioner contends that the legislature did not expressly declare whether the 1989 amendment to the Act should be applied to convictions that became final before August 5, 1989. He asserts that the legislature's silence creates a presumption that the amendment was not intended to apply to convictions entered before its effective date. Defendant contends that the new limitation period applies to all post-conviction proceedings, regardless of when the conviction was entered in the register.
A state may limit the time within which a prisoner may seek post-conviction relief. See, e.g., United States v. Randolph, 262 F.2d 10 (7th Cir.1958), cert. den. 359 U.S. 1004, 79 S. Ct. 1143, 3 L. Ed. 2d 1032 (1959). Therefore, the sole issue here is whether the legislature intended the limitation that it established in 1989 to apply to convictions entered before its effective date.[3]
Legislative silence has generally led Oregon appellate courts to construe statutory amendments to only apply prospectively. See State v. Burke, 109 Or. App. 7, 10, 818 P.2d 511 (1991). This is true,
"without respect to whether the change might be `procedural or remedial' or `substantive' in a strictly technical sense." Joseph v. Lowery, 261 Or. 545, 549, 495 P.2d 273 (1972).
*721 However, with the exception of ex post facto laws, the legislature may enact legislation intended to apply retroactively. See Whipple v. Howser, 291 Or. 475, 480, 632 P.2d 782 (1981).
In determining whether the 1989 amendment applies to convictions entered before its effective date, our duty is to ascertain the legislature's intent. ORS 174.020; State v. Galligan, 312 Or. 35, 39, 816 P.2d 601 (1991). Our first step is to examine the language of the statute itself. ORS 174.010; State ex rel Juv. Dept. v. Ashley, 312 Or. 169, 174, 818 P.2d 1270 (1991).
ORS 138.510(1) provides:
"Except as otherwise provided in ORS 138.540, any person convicted of a crime under the laws of this state may file a petition for post-conviction relief pursuant to [the Act]."
ORS 138.540(1) provides, in relevant part:
"Except as otherwise provided in [the Act], a petition pursuant to [the Act] shall be the exclusive means, after judgment rendered upon a conviction for a crime, for challenging the lawfulness of such judgment or the proceedings upon which it is based."
The plain meaning of the words in ORS 138.540(1) is that a petition pursuant to the Act is the exclusive means for challenging the lawfulness of a conviction, unless the Act specifies otherwise. The Act does not distinguish between convictions that became final before August 5, 1989, and convictions that became final after that date. Consequently, judgments entered before August 5, 1989, are not "otherwise provided [for] in [the Act]." ORS 138.540(1) requires that challenges to those convictions, like any other, must be made "pursuant to the Act."
The Act now provides a single 120-day time frame for filing a post-conviction petition. If the petition must be filed pursuant to the Act, then this petition, like any other, must have been filed within that time frame, unless the grounds for relief "could not reasonably have been raised" earlier. ORS 138.510(2).
Defendant contends that the legislature expressly provided for a collateral attack on convictions entered before August 5, 1989, in ORS 138.510(2). In this regard, defendant says:
"What the legislature did do, however, was to include a general provision that allows an untimely petition (i.e., one not filed within 120 days after the conviction became final) if the claims asserted therein `could not reasonably have been raised in the original or amended petition' (e.g., the petitioner has some legitimate excuse for not filing the petition in a timely manner). That provision provides a mechanism for a petitioner whose post-conviction petition otherwise would be barred by strict application of the new 120-day rule to avoid the bar."
The Act now provides that an untimely petition may be filed if
"the court on hearing a subsequent petition finds grounds for relief asserted which could not reasonably have been raised in the original or amended petition * * *." ORS 138.510(2).
Although the legislature may have intended to permit the late filing of a petition on the basis of some kind of good cause standard, the language used to convey that message is less than straightforward. The language in ORS 138.510(2), read literally, appears to dictate that an untimely petition, whatever its merits, can be considered only if an earlier petition was timely filed. We need not construe the meaning of that language, because petitioner did not allege, and does not contend, that his petition fits within the purported exception to the 120-day limitation period.
Defendant contends that the new limitation may be applied to all persons convicted before August 5, 1989, so long as they are given a reasonable amount of time after that date to file a post-conviction petition. Defendant asserts that the new 120-day limit also measures a reasonable amount of time to challenge convictions entered before that date.[4]
*722 Generally, determination of what is a reasonable amount of time is within the legislature's purview. Texaco, Inc. v. Short, 454 U.S. 516, 527 n. 21, 102 S. Ct. 781, 791 n. 21, 70 L. Ed. 2d 738 (1982) (citing Wilson v. Iseminger, 185 U.S. 55, 22 S. Ct. 573, 46 L. Ed. 804 (1902)). However, the Oregon Supreme Court declared some time ago:
"If the legislature should pass an act, barring a past action, without any allowance of time for the institution of a suit in future, such an act would be so unreasonable as to amount [to] a denial of [a] right, and call for the interposition of the court.
"We conclude, then, that * * * the court is bound, by the fundamental law, to give a party reasonable time in which to escape the effect of such remedy." McLaughlin v. Hoover, 1 Or. 31, 34 (1853). (Emphasis supplied.)
Oregon courts have not heretofore declared how to measure a "reasonable time" when the legislature has neglected to do so explicitly. We find North Carolina's approach instructive. When the legislature shortens a limitation period,
"a reasonable time [to commence a suit after the effective date] shall be the balance of the time [remaining under the old law], provided it shall never exceed the time allowed by the new statute." Spaulding v. R.J. Reynolds Tobacco Co., 93 N.C. App. 770, 379 S.E.2d 49, 51 (1989), aff'd. 326 N.C. 44, 387 S.E.2d 168 (1990).
Oregon case law is consistent with that formula. Each time that appellate courts have gauged a "reasonable time" for bringing actions after the legislature shortened a limitation period, the "reasonable time" either equalled, or was less than, the new limitation period. See Evans v. Finley, 166 Or. 227, 111 P.2d 833 (1941); McLaughlin v. Hoover, supra; Wolf v. Goin, 26 Or. App. 23, 552 P.2d 258, rev. den. 276 Or. 133 (1976).
The 120-day period, from August 5 to December 3, 1989, provided a reasonable window of opportunity for petitioner to seek relief. He failed to take advantage of that opportunity. We are persuaded that the statute evinces the legislature's intent to apply the limitation period uniformly to all convictions, regardless of when they were entered in the register. Therefore, we hold that the post-conviction court correctly dismissed the petition.
Affirmed.
BUTTLER, Judge, dissenting.
Because the legislature neither expressed its intention that the new 120-day Statute of Limitations for post-conviction actions, ORS 138.510, be applicable to judgments on convictions entered before the effective date (August 5, 1989) nor provided a grace period within which petitions concerning those pre-limitation judgments may be challenged under the Post Conviction Act, I dissent. As a matter of law, if the legislature had provided the grace period that the majority imposes ad hoc, it would have expressed its intention that the new limitation period apply to all judgments on convictions, whenever entered. See Evans v. Finley, 166 Or. 227, 111 P.2d 833 (1941). Because the legislature did not do that, it is not for this court to do so. The majority has put the cart before the horse.
The majority divines the legislature's intent out of thin air, as if the legislature does not know how to express its intention. That is unfair to that co-equal branch and is totally unjustified. When the legislature wants to apply a new limitation period retroactively, it says so. For example, in 1987, it adopted a new time limit for the appeal of premium audit disputes relating to workers' compensation insurance. See Kilham Stationery v. National Council on Comp. Ins., 109 Or. App. 545, 820 P.2d 842 (1991). ORS 737.505, as amended, allows 60 days after receipt of a final premium audit billing within which appeals to the director must be made. At the same *723 time that it adopted the new limitation, the legislature also amended ORS 737.318(4):
"Notwithstanding ORS 737.505, the provisions of this section apply to all premium audit disputes between employers and insurers in existence on July 20, 1987, regardless of the policy year involved or the date of the final audit billing."
The legislature did not enact that kind of provision here.
The majority apparently accepts defendant's contention that the amendment is to be applied retroactively, because it does not express an intention to exempt those convicted before its effective date from the new limitation period, and that previously convicted persons, including petitioner, have a 120-day grace period from the effective date of the amendment within which to file a petition. That is a new twist. The general rule is that, in the absence of a clear legislative direction, a statute that shortens a limitation period is applied prospectively only. Reynolds Metals Co. v. State Tax Comm., 245 Or. 156, 421 P.2d 379 (1966); Fullerton v. Lamm, 177 Or. 655, 163 P.2d 941, 165 P.2d 63 (1945); Pitman v. Bump, 5 Or. 17 (1873); Bergstad v. Thoren, 86 Or. App. 70, 738 P.2d 223 (1987); Bower Trucking and Whse. Co. v. Multnomah Cty., 35 Or. App. 427, 432, 582 P.2d 439 (1978).
Furthermore, contrary to defendant's assertion, ORS 138.510 does indicate the legislature's intention that the limitation provided by the amendment not be applied retroactively. ORS 138.510(3) expressly provides that post-conviction relief is available to persons convicted before May 26, 1959, the effective date of the original act. Obviously, the remedy would not be available to those persons if the newly adopted limitation was intended to apply retroactively, unless it can be said that the statute intends, by its silence, that there be a 120-day grace period. ORS 138.510(3) makes it clear that the post-conviction act applied retroactively, granting any person convicted of a crime, whether before or after the effective date of the act, the right to file for post-conviction relief. It is equally clear from that provision that the legislature knew how to express its intention to apply a statute retroactively, yet it did not do so in enacting the new 120-day limitation.
In Pitman v. Bump, supra, the plaintiff brought an action for criminal conversation. The action accrued in March, 1870, at which time the limitation for bringing the action was six years. In October, 1870, the legislature shortened the limitation period to require that an action be brought two years "after the cause of action shall have accrued." The defendant contended that the action, commenced in February, 1873, was barred, because the amendment required that it be brought within two years after the time it had accrued or, in any case, not "beyond two years from the passage of the amendatory act." In rejecting each contention and holding that the amendment did not apply retroactively, the court stated:
"The amendment makes but one rule for ascertaining when the period is to commence, and it makes no provision for a period to commence at the passage of the act; the time when the "cause of action shall have accrued" is the only point at which the period can commence, and it would be disregarding the statute, rather than construing it, to make the period of two years commence at the passage of the amendment, without regard to the time when the cause of action accrued.
"If any reasonable construction would exclude from the effect of the amendment all cases in which fully two years had then run, and yet include some other cases in which the cause of action had already arisen, we find no rule for determining which of the latter cases should be included, or for discriminating between causes of action that accrued nearly two years before the passage of the act, and those that accrued a month or even a day previous. The computation commencing in all cases at the time the cause of action accrued, it might include cases that would become barred in a week or a day after the passage of the act. As a general rule such construction *724 is not favored, and courts have refused to give a retroactive effect to statutes of this kind, unless that intention is so clear and positive as by no possibility to admit of any other construction." 5 Or. at 21.
Similarly, ORS 138.510(2), as amended, states but one rule for determining when an action must be brought: within 120 days after "the date the judgment or order on the conviction was entered in the register," if no appeal is taken. It would not be consistent with that expressed intention to interpret the statute to provide a grace period of 120 days to those convicted before its effective date. As indicated, I would conclude that the amendment provides no basis for determining that it is to be applied retroactively.
There is another line of cases that bears discussion, however. In Evans v. Finley, supra, 166 Or. at 233, 111 P.2d 833, an action to establish the priority of a mortgage lien, the Supreme Court accepted the view that the
"legislature may enact a statute which limits the time within which actions may be brought to enforce demands where there was previously no period of limitation or which shortens the existing time of limitations and such a law may operate upon existing contracts without necessarily being invalid as impairing their obligations. * * * [T]he rule is subject to the limitation that a reasonable time must be given for the commencement of an action before the bar takes effect." (Emphasis supplied.)
The statute at issue there had been amended to require the filing of an affidavit by the mortgagee every three years in order to retain a priority over subsequent mortgagees. Clearly, the legislature intended the statute to apply retroactively, because it expressly provided a six-month grace period after its effective date to those for whom the time for acting would otherwise have expired before the enactment of the statute.
In Nichols v. Wilbur, 256 Or. 418, 473 P.2d 1022 (1970), a wrongful death case, the court quoted from a California decision that made essentially the same statement as quoted from Evans:
"`It is clear from the decisions of the courts of this state as well as those of other jurisdictions that a person has no vested right in the running of a statute of limitations unless it has completely run and barred the action. Before the action is barred by the statute, the Legislature has absolute power to amend the statute and alter the period of limitations prescribed therein, subject only to the requirement that a reasonable time must be allowed for the prosecution of an action or proceedings after the passage of an amendment shortening the period.'" 256 Or. at 419, 473 P.2d 1022, (quoting Davis & McMillan v. Industrial Acc. Com., 198 Cal. 631, 636, 246 P. 1046 (1926)).
The question in Nichols, however, was whether a statute that extended the limitation period should be applied retroactively. Despite the fact that the statute itself indicated no clear intention that it be applied retroactively, the court held that it should be, also relying on a rule quoted from the California decision that
"`an amendment to a statute of limitations enlarging the period of time within which an action can be brought as to pending causes of action is not retroactive legislation, and does not impair any vested right.'" Nichols v. Wilbur, supra, 256 Or. at 419, 473 P.2d 1022, (quoting Davis & McMillan v. Industrial Acc. Com., supra, 198 Cal. at 637, 246 P. 1046).
Defendant contends that the two cited cases support the view that a statute that shortens a limitation period will be applied retroactively, so long as a reasonable time after its effective date is provided within which an individual with a previously accrued claim may bring an action. They do not. Nichols, apart from the quotations from the California decision, does not even discuss the retroactive application of a statute shortening a limitation period. Even the California decision dealt with a statute extending the limitation period. Evans is of no help to defendant, because the statute there expressly provided a grace period, *725 thereby clearly indicating that it was to apply retroactively.
There is another reason why defendant's argument is not persuasive. The requirement for providing a reasonable grace period after the statute's effective date originated in contract cases to avoid the constitutional prohibition against the impairment of the obligations of contract. See Evans v. Finley, supra, 166 Or. at 237, 111 P.2d 833. When the legislature expressly provides for a grace period, it expresses its intention that the statute be applied retroactively. In the absence of such a provision, I do not believe that a court's providing a grace period is a substitute for the legislature's doing so. That would express our intention, not the legislature's.
Defendant cites McLaughlin v. Hoover, 1 Or. 31 (1853), for the proposition that a "new statute applies if the plaintiff/petitioner actually had a reasonable period after the effective date in which to file the action." (Emphasis defendant's.) First, as defendant appears to concede, later cases, including Reynolds Metals Co. v. State Tax Comm., supra; Fullerton v. Lamm, supra; and Pitman v. Bump, supra, have rendered McLaughlin an "historical curiosity." In any event, the case is distinguishable. Unlike here, the new Statute of Limitations there did not change the time for filing an action; it left it as it was. Additionally, as the court concluded, the new statute indicated an intention that it apply to existing claims.
In Wolf v. Goin, 26 Or. App. 23, 552 P.2d 258, rev. den. (1976), we held that an amendment adding a limitation where none had previously existed applied to an action that had accrued before the amendment's effective date, where the plaintiff had, in fact, had four years, "a patently `reasonable' period," 26 Or. App. at 28, 552 P.2d 258, after the effective date of the amendment, within which to bring the action. I would disapprove that decision to the extent that it suggests that an amendment shortening a limitation period is to be applied retroactively, in the absence of an express intention to that effect, just because the plaintiff, in fact, had a reasonable time after its enactment within which to bring the action.
Finally, defendant contends that, although the amendment does not expressly state that it is to be applied to prior convictions, that intention can be inferred from ORS 138.510(2), allowing a waiver of the 120-day period in certain circumstances. ORS 138.510(2) makes the 120-day limitation applicable,
"unless the court on hearing a subsequent petition finds grounds for relief asserted which could not reasonably have been raised in the original or amended petition."
Defendant argues that that language allows for the filing of an untimely original petition for post-conviction relief if the petitioner has a legitimate excuse for not having filed the petition timely. As I read the quoted language, however, it says nothing about the late filing of original petitions; it deals only with "subsequent" petitions. Neither does the amendment provide a basis for excusing the late filing of a petition; it authorizes the filing of a subsequent petition that states grounds for post-conviction relief that could not reasonably have been raised in the original petition that presumably was filed within the 120-day limitation. The language relied on contains no suggestion that the 120-day limitation should apply to prior convictions.
Because I would reverse and remand, I dissent.
ROSSMAN, EDMONDS and DURHAM, JJ., join in this dissent.
NOTES
[1] Post-Conviction Hearing Act, ORS 138.510 ORS 138.680.
[2] The petition alleges only that petitioner was denied effective assistance of counsel, because his trial attorney did not object to imposing restitution. Petitioner does not allege any "grounds for relief which could not reasonably have been raised," ORS 138.510(1), within 120 days after either entry of judgment or enactment of the limitation period.
[3] Petitioner raises no constitutional challenges to the new limitation period.
[4] The Department of Justice represents in this case that it has not moved to dismiss any petition filed by December 3, 1989, which was the end of the 120-day period commencing on the amendment's effective date. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1471528/ | 924 F.Supp. 548 (1996)
Marc PERRY, Plaintiff,
v.
BURGER KING CORPORATION and S.Z. Restaurant Corporation, Defendants.
No. 95 Civ. 5424 (RO).
United States District Court, S.D. New York.
May 2, 1996.
*549 *550 Seth J. Farber, Robert J. Barsch, New York City, for Plaintiff.
Howard S. Wolfson, Whitman Breed Abbott & Morgan, New York City, for Defendant Burger King Corporation.
Traycee E. Klein, Dienst & Serrins, New York City, for Defendant S.Z. Restaurant Corporation.
MEMORANDUM ORDER
OWEN, District Judge.
Plaintiff Marc Perry alleges race discrimination against him by defendants Burger King Corporation ("BKC") and S.Z. Restaurant Corporation ("SZ"), the franchisor and franchisee of a Burger King Restaurant on 110th Street and Broadway in Manhattan. He claims that on February 20, 1995, after having eaten in the restaurant, he was denied use of the restaurant's bathroom because he is black. The proposed Amended Complaint alleges five causes of action, three federal and two state claims: civil rights violations under 42 U.S.C. §§ 1981, 1982, and 2000a, and state law claims for negligent hiring and supervision and intentional infliction of emotional distress. Plaintiff seeks $1 million in compensatory damages, $10 million in punitive damages, injunctive relief, and attorney's fees. Before me now are three motions:[1] (1) plaintiff's motion to amend his complaint pursuant to Fed.R.Civ.P. 15(a); (2) SZ's motion to dismiss the complaint for failure to state a claim under Fed.R.Civ.P. 12(b)(6) or, in the alternative, for summary judgment under Fed.R.Civ.P. 56; and (3) BKC's motion for judgment on the pleadings or summary judgment pursuant to Fed.R.Civ.P. 12(c) and 56 respectively. For the reasons stated below, plaintiff's Amended Complaint is accepted as to SZ; I grant SZ's motion to dismiss as to the second, fourth, and fifth causes of action and deny it as to the first and third; and I grant BKC's motion for summary judgment dismissing it from the action.
Defendant BKC operates and franchises Burger King restaurants. More than 90 percent of the approximately 6,500 Burger Kings are independently owned and operated franchises. The restaurant on 110th Street is one such franchise, owned and operated by *551 SZ.[2] The relationship between BKC and the franchisee is governed by BKC's standard franchise agreement. The Franchise Agreement provides:
Franchisee is an independent contractor and is not an agent, partner, joint venturer or employee of BKC.... Franchisee shall have no right to bind or obligate BKC in any way.... BKC shall have no control over the terms and conditions of employment of Franchisee's employees.... Franchisee shall exhibit on the premises ... a notification that the Franchised Restaurant is operated by an independent contractor and not by BKC.
Plaintiff is a 32 year-old African American male. Plaintiff's original complaint alleged the following: On February 20, 1995 at 8:00 p.m., Perry, after eating at the Burger King, asked for the key to the rest room, but alleges he was told that the bathroom was out of order and was shown signs to that effect. Perry then asserts that he saw white patrons leaving the rest room, and again requested the bathroom key, but was denied once more. He states that employees of the restaurant then made "racially-based offensive comments," and after another white patron emerged from the rest room, plaintiff states he held open the door and observed that the facilities were in working order. Plaintiff now, in a proposed Amended Complaint, further alleges that the manager used racial epithets and employees physically threatened him. Plaintiff contacted New York City Police, and officers arrived, spoke to restaurant employees, and declined to make an incident report or file a complaint. Perry asserts that the restaurant intended to deny service to "undesirables" blacks and Hispanics by "virtue of an apparent policy to so discriminate." Amend. Compl. at ¶ 12.
Perry moves pursuant to Fed.R.Civ.P. 15(a) to amend his complaint. Rule 15(a) holds in part that a "party may amend ... once as a matter of course at any time before a responsive pleading is served.... Otherwise a party may amend the party's pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires." SZ never filed an answer, but moved to dismiss. "Because a motion to dismiss does not constitute a responsive pleading under Rule 15(a), no responsive pleading has been served in this case, and plaintiff is entitled to amend the complaint `as a matter of course.'" Levy v. Lerner, 853 F.Supp. 636, 638 (E.D.N.Y. 1994), aff'd, 52 F.3d 312 (2d Cir.1995). Accordingly, as to SZ, plaintiff may amend without leave of the Court.
Defendant BKC did submit an answer, thus precluding absolute entitlement to amend, and it opposes plaintiff's motion to amend. Although leave to amend shall be freely granted, leave to amend can be denied if the amendment would be futile. Mackensworth v. S.S. American Merchant, 28 F.3d 246, 251 (2d Cir.1994); John Hancock Mut. Life Ins. Co. v. Amerford Int'l Corp., 22 F.3d 458, 462 (2d Cir.1994). Here, for reasons set forth hereafter, leave to amend as to BKC is denied, since I grant BKC's motion for summary judgment on grounds equally applicable to either the original or Amended Complaint.
SZ moves to dismiss all five causes of action in the proposed Amended Complaint. SZ asserts that plaintiff has failed to state a claim in either the civil rights causes of action or the state law claims. Since matters outside the pleadings were presented to and not excluded by the Court, SZ's motion is treated as one for summary judgment under Fed.R.Civ.P. 56, and I must only assess whether genuine issues of material fact remain for a jury, resolving any ambiguities and drawing all reasonable inferences against the moving party. Morris Okun, Inc. v. Harry Zimmerman, Inc., 814 F.Supp. 346 (S.D.N.Y.1993).
With respect to the first cause of action, 42 U.S.C. § 1981 provides that "All persons ... shall have the same right ... to make and enforce contracts ... and to the full and equal benefit of all laws and proceedings *552 for the security of persons and property as is enjoyed by white citizens...." Subsection (b) of this provision states that the term "make and enforce contracts" includes "the enjoyment of all benefits, privileges, terms, and conditions of the contractual relationship." The statute applies to acts of private racial discrimination, and essential "to an action under Section 1981 are allegations that the defendants' acts were purposefully discriminatory ... and racially motivated." Albert v. Carovano, 851 F.2d 561, 571 (2d Cir. 1988) (en banc) (citations omitted); Yusuf v. Vassar College, 827 F.Supp. 952, 955 (S.D.N.Y.1993), aff'd in part, rev'd in part, 35 F.3d 709 (2d Cir.1994). To establish a § 1981 claim, a plaintiff must allege facts showing: "(1) the plaintiff is a member of a racial minority; (2) an intent to discriminate on the basis of race by defendant; and (3) the discrimination concerns one or more of the activities enumerated...." Mian v. Donaldson, Lufkin & Jenrette Sec. Corp., 7 F.3d 1085 (2d Cir.1993). Resolving all ambiguities against SZ, plaintiff has stated a claim under § 1981, particularly if Perry is considered to have contracted for food and use of the bathroom. Issues of material fact preclude summary judgment as to plaintiff's first cause of action. See also Perry v. Command Performance, 913 F.2d 99 (3d Cir. 1990), cert. denied, 502 U.S. 1093, 112 S.Ct. 1166, 117 L.Ed.2d 412 (1990); Bermudez Zenon v. Restaurant Compostela, Inc., 790 F.Supp. 41, 44 (D.P.R.1992); Patterson v. McLean Credit Union, 491 U.S. 164, 176, 109 S.Ct. 2363, 2372, 105 L.Ed.2d 132 (1989).[3]
As to the second cause of action, § 1982 involves real or personal property: "All citizens ... shall have the same right ... as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property." 42 U.S.C. § 1982. Section 1982 has been interpreted to include a somewhat broad definition of "property." See Olzman v. Lake Hills Swim Club, Inc., 495 F.2d 1333, 1339 (2d Cir.1974), where it was stated: "[i]t is reasonable to characterize the freedom of blacks to go and come as guests of a swim club member as sufficiently pertaining to a condition of property to be a right capable of being held under § 1982." Plaintiff's allegations, however, fall outside of even this broad definition. Use of a restaurant's bathroom is not a right to "inherit, purchase, lease, sell, hold, and convey real and personal property." Perry accordingly fails to state a claim under § 1982, and the second cause of action is dismissed.
Plaintiff's third cause of action is under 42 U.S.C. § 2000a, which provides that: "[a]ll persons shall be entitled to the full and equal enjoyment of the goods, services, facilities ... and accommodations of any place of public accommodations ... without discrimination or segregation on the ground of race...." This section most directly addresses the discrimination alleged here, for it covers restaurants and their rest rooms. Presley v. City of Monticello, 395 F.2d 675 (5th Cir.1968). Again, resolving all ambiguities in favor of the non-moving party, I deny SZ's motion as to this cause of action.
Perry also asserts two state law tort claims: negligent hiring and supervision and intentional infliction of emotional distress. The courts of New York have long recognized a claim for negligent hiring, however, "[t]o recover damages for injuries sustained because an employer has hired or retained an incompetent employee, a plaintiff must establish a duty owed by the defendant employer, a breach of that duty by the defendant employer, and damages proximately caused by the defendant employer's breach". Vincenzino v. Calvosa, 151 Misc.2d 95, 572 N.Y.S.2d 611, 612 (N.Y.Sup.Ct.1991). A defendant employer may be required to answer for the tort of an employee against a third party, but only "when the employer has either hired or retained the employee with knowledge of the employee's propensity for the sort of behavior which caused the injured party's harm." Detone v. Bullit Courier Service, Inc., 140 A.D.2d 278, 528 N.Y.S.2d 575, 576 (1988). A prior decision in this district has already noted that "New York courts have not recognized claims for negligent hiring of an employee whose subsequent offense involved racial harassment." Brown v. *553 Bronx Cross County Medical Group, 834 F.Supp. 105, 109 (S.D.N.Y.1993). Moreover, most of the cases in which this claim has been sustained involve significant physical injury. Brown, 834 F.Supp. at 110. Perry alleges racial harassment and fails to establish the requisite elements to state a claim for negligent hiring under New York law. Accordingly, the fourth cause of action is dismissed.
Perry's fifth claim seeks recovery for intentional infliction of emotional distress. To state a cause of action for this tort, New York uses the Restatement 2d of Torts definition of intentional infliction of emotional distress, requiring plaintiff to allege four elements: (1) extreme and outrageous conduct; (2) intent to cause, or disregard of a substantial probability of causing, severe emotional distress; (3) a causal connection between the conduct and the injury; and (4) severe emotional distress. Mohamed v. Marriott Int'l., Inc., 905 F.Supp. 141, 157 (S.D.N.Y.1995); Howell v. New York Post Co., Inc., 81 N.Y.2d 115, 596 N.Y.S.2d 350, 353, 612 N.E.2d 699, 702 (1993). This standard is extraordinarily strict, thus liability will flow only from conduct that "is so outrageous in character and so extreme in degree as to go beyond all bounds of decency, and to be regarded as atrocious and utterly intolerable in a civilized community." Martin v. Citibank N.A., 762 F.2d 212, 220 (2d Cir.1985) (citations omitted); Murphy v. American Home Products Corp., 58 N.Y.2d 293, 461 N.Y.S.2d 232, 236, 448 N.E.2d 86, 90 (1983). Overt acts of discrimination have generally not been found to rise to the level of intentional infliction of emotional distress. Mohamed, 905 F.Supp. at 158. In Howell, the New York Court of Appeals stated that "[i]ndeed, of the intentional infliction of emotional distress claims considered by the Court, every one has failed because the alleged conduct was not sufficiently outrageous." Howell, 596 N.Y.S.2d at 353, 612 N.E.2d at 702. A district court in this circuit noted further that "[i]n the rare instances where the New York courts have found the complaint sufficient to state a claim for intentional infliction of emotional distress in the employment context, the claims have been accompanied by allegations of sex discrimination and more significant battery." Gerzog v. London Fog Corp., 907 F.Supp. 590 (E.D.N.Y.1995). Under the stringent standard of New York law, plaintiff fails to state a claim for intentional infliction of emotional distress, and this cause of action is dismissed.
Accordingly, I grant SZ's motion for summary judgment as to the second, fourth, and fifth causes of action and deny its motion as to the first and third claims.
Defendant BKC moves for judgment on the pleadings under Rule 12(c) and/or summary judgment under Rule 56. Again, having received and considered matters outside the pleadings, I treat the motion as one for summary judgment. When I denied without prejudice plaintiff's motion to amend on November 13, 1995, I observed that plaintiff had thus far failed to indicate any involvement or responsibility by franchisor BKC. However, notwithstanding plaintiff's submission of the Amended Complaint and supporting material, alleging control and responsibility by BKC, and viewing this evidence and inferences arising therefrom in favor of plaintiff, there are still no genuine issues of material fact in dispute precluding dismissal.
BKC's central assertion is that SZ, not it, owns and operates the Burger King on 110th Street, and plaintiff does not allege any discrimination pursuant to a policy or practice of BKC or with BKC's knowledge or consent, or within its oversight. According to the Franchise Agreement, SZ is an independent contractor, not an agent or employee of BKC. BKC argues that, to the extent that plaintiff was denied the rest room key, there is no allegation or showing that the denial resulted from any action or policy of BKC. The Franchise Agreement states in part:
BKC shall have no control over the terms and conditions of employment of Franchisee's employees.... In all public records and in his relationship with other persons ... Franchisee shall indicate his independent ownership of the franchised restaurant. Franchisee shall exhibit on the premises ... a notification that the Franchised Restaurant is operated by an independent contractor and not by BKC.
*554 Plaintiff's primary contention is that BKC exerts a high level of control over its franchises, and since the issue of control is a material question of fact, a denial of summary judgment is warranted. The Amended Complaint states "on information and belief":
Burger King, by virtue of its franchise agreements and other contractual bases, controls and regulates the day-to-day operations of S.Z. Corp., and sets its policies, practices and procedures, including but not limited to control of the terms of operations, signs ... employment terms and training and approval of managers ...
Further ... on information and belief, indicia of S.Z.'s ownership of the restaurant is nowhere displayed publicly at the restaurant, and accordingly, defendant S.Z. is operating under an apparent agency to defendant Burger King. Further, on information and belief, Burger King controls all signs and advertising, and further, S.Z. and Burger King act in concert for the purposes of maintaining to the public that the restaurant is a Burger King restaurant....
However, a party opposing summary judgment may not rely, as here, upon "mere speculation or conjecture as to the true nature of the facts to overcome a motion for summary judgment," David v. Glemby Co., Inc., 717 F.Supp. 162, 165 (S.D.N.Y.1989), and the "mere possibility that a factual dispute may exist, without more, is not sufficient to overcome a convincing presentation by the moving party." Prompt. Elec. Supply Co., Inc. v. Allen-Bradley, Co., 492 F.Supp. 344, 346 (S.D.N.Y.1980).
The nature of the franchisor-franchisee relationship here,[4] the Franchise Agreement, and the affidavit of BKC's in-house counsel in opposition all demonstrate that plaintiff has not presented a triable issue regarding BKC. Accordingly, BKC's motion for summary judgment is granted. See also Hayman v. Ramada Inn, Inc., 86 N.C.App. 274, 357 S.E.2d 394 (1987) (in suit where hotel guest was injured while on franchisee's premises, summary judgment affirmed in favor of franchisor where franchisor did not have actual authority over day-to-day operations and franchisor did not hold itself out to public as having apparent authority); Murphy v. Holiday Inns, Inc., 216 Va. 490, 219 S.E.2d 874 (1975) (summary judgment affirmed in favor of franchisor where franchise agreement gave franchisor no power to control *555 daily maintenance of the premises); Neff v. American Dairy Queen Corp., 58 F.3d 1063 (5th Cir.1995), cert. denied, ___ U.S. ___, 116 S.Ct. 704, 133 L.Ed.2d 660 (1996) (summary judgment affirmed where rights under franchise agreement did not make franchisor "operator" for purposes of Americans with Disability Act).
For the reasons stated above, I accept plaintiff's Amended Complaint as to SZ, but deny plaintiff's motion to amend his complaint as to BKC; I grant SZ's motion for summary judgment as to the second, fourth, and fifth causes of action, but deny SZ's motion as to claims one and three; and I dismiss BKC from this action on its motion for summary judgment.[5]
The foregoing is so ordered.
NOTES
[1] On November 13, 1995, I heard argument on three motions: plaintiff's motion to amend his complaint; SZ's motion to dismiss or for summary judgment; and BKC's motion for judgment on the pleadings or summary judgment. Since plaintiff had withdrawn two of his claims on the eve of the November 13, 1995 argument and had not established why BKC, the franchisor, was included in the action, I denied plaintiff's motion to amend without prejudice, and instructed plaintiff to revise his complaint. Plaintiff has now done so, and defendants have renewed their motions.
[2] The 110th Street restaurant was franchised to Jerome Zavidow on February 4, 1984 and later assigned to SZ.
[3] The Civil Rights Act of 1991 overturned Patterson in the employment context in that it expanded § 1981 to cover discriminatory actions that occurred after a person is hired.
[4] An array of analogous cases support summary judgement in favor of BKC. For example, in Evans v. McDonald's Corp., 936 F.2d 1087 (10th Cir.1991), the court held that the franchisor could not be held liable in a sexual harassment suit where the plaintiff was a manager of the franchisee, because plaintiff was not an employee of the franchisor: "the record before us indicates no common management, no centralized control of labor relations, and no common ownership or financial control." Id. at 1090. In Myszkowski v. Penn Stroud Hotel, Inc., 430 Pa.Super. 315, 634 A.2d 622 (1993), plaintiff sued defendants Best Western Inc. and Penn Stroud Hotel after being sexually assaulted in the bathroom of a hotel. Summary judgment was granted in favor of Best Western. The court noted that the agreement between Penn Stroud and Best Western "specifically provided that their relationship is one of independent contractor" and that there was "clearly not the necessary control by Best Western of day-to-day operations" to find Best Western liable. Id. 634 A.2d at 627. Similarly, in Little v. Howard Johnson Co., 183 Mich.App. 675, 455 N.W.2d 390 (1990), in which a person sustained injuries by falling on an icy walkway in front of the restaurant, summary judgment was granted in favor of the franchisor. The court stated that the franchisor could not be held directly liable because it was not the possessor of the restaurant and could not be held vicariously liable because franchisor retained no power to control the details of the day-to-day operations. Id. 455 N.W.2d at 394. Moreover, in Myers v. Holiday Inns, Inc., No. CIV.A. 88-4222, 1989 WL 81303 (E.D.La.), the plaintiff alleged that the defendants intentionally violated her civil rights by refusing to give her the room she wanted and refusing to serve her breakfast in the motel restaurant. There, the district judge granted the franchisor summary judgment because plaintiff failed to produce evidence that the franchisee was the principal of Holiday Inn, and Holiday Inn submitted sufficient evidence to show that it exercised no day-to-day control over the franchisee's motel.
Although Singleton v. International Dairy Queen, 332 A.2d 160 (Del.Super.Ct.1975), appears to support plaintiff's position, the overwhelming weight of the authority squarely supports granting summary judgment in favor of BKC. Singleton is distinguishable from the case at bar because the injury in that case a young girl falling through a glass door of a franchised Dairy Queen restaurant related directly to an element of the franchise controlled by franchisor the physical structure and remodeling of the franchise.
[5] Defendant SZ also has made a motion for sanctions under Fed.R.Civ.P. 11. That motion is denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2237094/ | 350 Ill. App. 26 (1953)
111 N.E.2d 578
Elizabeth Williams, Appellant,
v.
Arthur Fredenhagen, Appellee.
Gen. No. 10,664.
Illinois Appellate Court.
Opinion filed March 26, 1953.
Released for publication April 13, 1953.
*27 *28 CARL O. BUE, of Elmhurst, for appellant.
GEORGE H. BUNGE, of Downers Grove, for appellee.
MR. JUSTICE ANDERSON delivered the opinion of the court.
[1] On November 17, 1951 Elizabeth Williams, plaintiff-appellant, filed her affidavit for scire facias against Arthur Fredenhagen, defendant-appellee, to revive a judgment entered November 19, 1931 in a case entitled Martha Thomas, plaintiff v. Arthur Fredenhagen, defendant, in the circuit court of Du Page county, Illinois. Proceedings to revive judgments by scire facias are governed by Ill. Rev. Stat., 1951, chap. 83, par. 24b [Jones Ill. Stats. Ann. 107.284(2)]. The statute provides that judgments in courts of record *29 may be revived by scire facias within twenty years next after the date of such judgment. The clerk of the court, on the date that the affidavit was filed, issued a writ of scire facias which was served on the defendant shortly thereafter. The defendant filed a motion to dismiss the proceedings alleging in substance that the plaintiff had no interest in the judgment as sole heir of Martha Thomas who he claims was the original judgment creditor. Before there was a hearing on this motion, on April 4, 1952, the plaintiff filed a motion asking leave of court to amend her affidavit and the scire facias issued thereon. The motion alleged that the original judgment sought to be revived was entered of record in the name of Elizabeth Williams, plaintiff herein, and was not entered in the name of Martha Thomas. This motion also asked that an amended writ of scire facias be issued retroactive to the date of the filing of the original affidavit and writ. The trial court denied plaintiff's motion to amend and granted defendant's motion to dismiss. Plaintiff has appealed from this order.
[2] Proceedings to revive a judgment by scire facias are wholly statutory. They are ancillary to the original judgment and generally speaking their purpose is to determine whether or not the judgment has been satisfied in whole or in part, so that if it has not been satisfied, the judgment creditor may sue out an execution and preserve the judgment and its lien. (Bank of Edwardsville v. Raffaelle, 381 Ill. 486; Waterbury Nat. Bank v. Reed, 231 Ill. 246.) The judgment debtor is summoned so that he may answer the proceedings in order to revive the judgment.
[3] It follows that there must be in the first instance a valid judgment. If there is no valid judgment, it cannot be revived; if there is a valid judgment, only the judgment creditor or her privies may revive it. Defendant admits that he is the original debtor, but he *30 contends that Elizabeth Williams, the plaintiff, is a stranger to the judgment and should not be permitted to obtain its revival. The nature and character of this purported judgment must be first determined.
It was stipulated by counsel that the following was a complete transcript of the common-law docket kept by the clerk of the circuit court of Du Page county, Illinois of the proceedings entitled Martha Thomas, plaintiff v. Arthur Fredenhagen, defendant and of all entries made therein:
To January Term 1931
Du Page County Circuit Court
Common Law General No. 16008
Attorneys Parties Action
Carl O. Bue Martha Thomas Trespass On The
v. Case of Promises
Arthur
Fredenhagen
Judge Date Orders of Court
Fulton Apr. 28, 1931 Suggestion of death
Shepherd Oct. 27, 1931 of Martha Thomas
Newhall Nov. 3, 1931 and Elizabeth Williams
Shepherd Nov. 19, 1931 heir at law
substituted. Order
of default (See Order)
Stricken from
Trial Call Upon
Stipulation Jury
waived. Cause submitted
to Court.
Judgment in sum of
$1332.50 and costs.
Judgment on findings.
*31 It was also stipulated that on the same day as the purported judgment was entered, the judgment and execution docket kept by the clerk showed that an execution was issued on the judgment. The docket states under designation of parties "Parties, Martha Thomas, et al. vs. Arthur Fredenhagen." The execution was never returned. It was further stipulated that the judgment entered in the case of Martha Thomas v. Arthur Fredenhagen in the circuit court of Du Page county, case number 16008, was the same judgment that is sought to be revived by scire facias in this proceedings.
[4] It is apparent from the above that no formal judgment was expanded and entered by the clerk from his minutes in the records of his office. The cases of People v. Petit, 266 Ill. 628, People v. Bristow, 391 Ill. 101, and Freeport Motor Casualty Co. v. Tharp, 406 Ill. 295 are pertinent to the question presented here. These cases all decide that a judgment at law is in effect as soon as it is pronounced by the court and not from the time it is formally entered in the record by the clerk. In the Petit case on page 631 of the opinion the trial judge's minute clerk entered the following: "Jury verd. fg. iss. for pltf. & assess pltfs. das. at $9500.00 & costs."
The clerk's docket showed: "Petit, Oct. 17, 1913. Jury verd. fdg. issue for pltf. das. at $9500.00 & costs. Jdg. on fdg."
[5] In the same case the court held that the above minutes and memoranda constituted a judgment on October 17, 1913, the date of the minute entry, although the formal judgment was not expanded and entered by the clerk until December 4, 1913. The court further held that the judgment of the court did not cease to be a judgment because the clerk failed to enter it of record. It will be observed that the minutes of JUDGE PETIT entered the verdict of the jury and contained no *32 entry of judgment. The clerk's minutes showed the verdict and further said that there was a judgment on findings. This case is quite similar to the instant case and we believe it to be authority that the minutes kept constituted a valid judgment on the day they were made.
In the Freeport case the question as to whether a judgment had been entered was considered and the court states on page 300 of the opinion:
When, then, was this judgment rendered? Although it is clear that the minutes, memoranda, or docket entries made, even by the judge upon his own docket, do not form a part of the official records of the court, yet they do afford a proper means of amending the record and assisting the clerk in accurately making up the record. (McCormick v. Wheeler, Mellick & Co., 36 Ill. 114.)
[6, 7] It appears from the above cases that a judgment at law is in effect the day it is announced by the court and that the clerk of the court may expand the minutes and enter the formal judgment from the minutes of the judge or the clerk. The fact that he does not expand the minutes until after the term of court or within thirty days does not affect the validity of the judgment. It is likewise the law that the judgment may not be expanded from the memory of the judge or the clerk but only from the minutes. (Freeport Motor Casualty Co. and People v. Petit, supra.) If the minutes are sufficient no nunc pro tunc order is needed. (People v. Bristow and People v. Petit, supra.)
[8] From an examination of the common-law docket and minutes kept by the clerk, there is no question but what the original suit was filed in the name of Martha Thomas, plaintiff, and against Arthur Fredenhagen, defendant. It is also clear from the minutes that the judgment was entered on November 19, 1931. The minutes are continuous and disclose the suggestion *33 of death of Martha Thomas and that Elizabeth Williams was substituted as party plaintiff. The minutes then state that the jury was waived, the cause was submitted to the court, and the judgment was entered in the sum of $1,332.50 and costs on the findings of the court. The defendant does not contend that the judgment was not entered against him. If the above minutes had been kept by the judge and no minutes had been kept by the clerk, the clerk would have been justified in entering a formal judgment in favor of Elizabeth Williams and against Arthur Fredenhagen on any day after the judgment was announced by the court. The clerk by necessity is required to keep minutes of what transpires in the court so that he may expand them later upon the records. His minutes are sufficient to expand the judgment in favor of Elizabeth Williams for the amount above stated and against the defendant. The fact that he did not expand the judgment is immaterial as it still may be expanded by him at his own initiative or by proper motion. In view of the opinion in the Petit case, we believe that the minutes kept by the clerk were sufficient to base an entry of a formal judgment. From them it appears that the court, on November 19, 1931, substituted Elizabeth Williams as party plaintiff, and on a hearing entered a judgment in her favor and against Arthur Fredenhagen for $1,332.50 and costs.
[9] In a proceedings to revive a judgment by scire facias the writ stands as a complaint and must set forth the facts upon which the plaintiff's right of action is based, and it is to this writ that the defendant is required to plead. (First Nat. Bank of Chicago v. Craig, 308 Ill. App. 377.) The plaintiff admitted that the first writ of scire facias was erroneous. It alleged that Martha Thomas had obtained the judgment sought to be revived and that Elizabeth Williams, her sole heir, asked for a revival of the judgment. Elizabeth *34 Williams by motion asked the court to be permitted to amend her former affidavit and writ of scire facias and that an alias writ of scire facias be issued. She further alleged that the original judgment was in fact rendered in her favor, that she was in fact the judgment creditor and asked that the judgment be revived and she have execution thereon. The plaintiff contended that the court erroneously refused to allow this motion and that the amendment should relate back to the filing and issuance of the original affidavit and writ of scire facias so as to prevent the bar of the twenty-year statute of limitations.
[10] It is conceded so far as the question of amendment is concerned that the provisions of section 46 (2) of the Civil Practice Act (Ill. Rev. Stat., ch. 110, par. 170 [1951; Jones Ill. Stats. Ann. 104.046]) apply to scire facias proceedings. This section of the Practice Act provides in substance that the cause of action set up in any amended pleading shall not be barred by lapse of time under any statute limiting the time within which the action may be brought if the time proscribed has not expired when the original pleading was filed, and if it shall appear from the original and amended pleading that the cause of action asserted in the amended pleading grew out of the same transaction set up in the original pleading, even though the original pleading was defective.
The case of Metropolitan Trust Co. v. Bowman Dairy Co., 369 Ill. 222 involved a death action. The complaint was filed within the statutory one-year period after the death of plaintiff's intestate. The plaintiff sought to amend his complaint after the expiration of the year from date of death. The court held that the amendment was proper and on page 229 of the opinion construed section 46 (2) of the Civil Practice Act as follows:
*35 "Under paragraph 2 of section 39 it was required that the cause of action set up in the amendment not only grew out of the same transaction or occurrence, but that it must be substantially the same as set up in the original pleading. The requirement for substantial identity was omitted from paragraph 2 of section 46. The sole requirement of that paragraph is that the cause of action set up in the amendment grew out of the same transaction or occurrence set up in the original pleading. Briefly summarized, section 46 permits any amendment of a pleading, filed in apt time, after the time limited for commencing suit to set up a cause of action on any claim which was intended to be brought by the original pleading, provided, only, that it grew out of the same transaction or occurrence, and it is not necessary that the original pleading technically state a cause of action, or that a cause of action set out in the amendment be substantially the same as any cause of action stated in the original pleading. The term `same transaction or occurrence,' so used in the statute, means the same suit. These changes, together with the judicial construction of the prior statutes, evince the legislative intent to remedy the evils incident to the former legislation and to preserve causes of action against loss by reason of technical rules of pleading. This is manifest from the concluding language of paragraph 2 which specifically declares the purpose of preserving the cause of action. The reasons for our decisions under the prior statutes are eliminated from section 46, and are not applicable to its provisions.
"The amendment in this case qualifies under all the requirements of section 46. Therefore, it relates back to the filing of the declaration and is not barred by the limitation in the Injuries act. The claim that such a construction of section 46 implies an attempted *36 amendment of the Injuries act in violation of section 13 of article 4 of the constitution is without merit. The Injuries act applies to the commencement of a suit and has no application to matters of pleading or procedure thereafter. The trial court correctly allowed the amendment to be filed."
[11, 12] The cause of action permitting the revival of the judgment within twenty years had not expired when the writ of scire facias was issued. The amended pleading grew out of the same transaction as alleged in the first pleading. By the words of the statute it related back to the date of the original scire facias and should have been permitted to be filed. Elizabeth Williams instituted the suit to revive the judgment. The only difference in the original scire facias and the one not permitted to be filed was that in the first she sued as heir and in the second she sued as owner of the judgment. Finding as we have that she was the original judgment creditor, who obtained a valid judgment against the defendant on November 19, 1931, it appears to us that under the facts the plain meaning of the Civil Practice Act prevented her from losing her suit by limitation. The purpose of this section of the Civil Practice Act is to prevent a party to a suit by inadvertence in the language of a pleading from losing his right of action by limitations between the time the complaint was filed and the time of the amendment. The statute should be construed broadly to carry out its purposes permitting liberal amendments to pleadings. (In re Estate of Schafer, 344 Ill. App. 608.)
[13] The defendant lastly contends that the court had some discretion in denying plaintiff's motion for leave to file an amended affidavit and for the issuance of an alias writ of scire facias. This contention is without merit. This discretion is a sound judicial discretion and it cannot be construed so broadly as to *37 permit the court to deprive a party of his cause of action. Discretion must be such that it will further the ends of justice.
It is our opinion that the trial court erred in not permitting the plaintiff to amend the original affidavit and writ of scire facias and in dismissing the cause of action.
For the above reasons the cause is reversed and remanded with directions authorizing the plaintiff to amend her affidavit and writ of scire facias.
Reversed and remanded with directions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2418319/ | 580 S.W.2d 623 (1979)
Jerome Leon WALKOVIAK et al., Appellants,
v.
HILTON HOTELS CORPORATION, Appellee.
No. B1923.
Court of Civil Appeals of Texas, Houston (14th Dist.).
April 4, 1979.
Rehearing Denied May 2, 1979.
*624 John Somyak, Stovall & Somyak, Houston, for Jerome Leon Walkoviak.
Jeffrey C. Londa, Butler, Binion, Rice, Cook & Knapp, Houston, for Florists' Mut. Ins. Co.
Larry D. Thompson, Lorance, Thompson & Wittig, Houston, for appellee.
Before J. CURTISS BROWN, C. J., and COULSON and CIRE, JJ.
COULSON, Justice.
This is an appeal by plaintiffs Jerome Leon Walkoviak (appellant) and Florists' Mutual Insurance Company (appellant Insurance Company) from a summary judgment in favor of the defendant Hilton Hotels Corporation (appellee) in a suit for personal injuries caused by the criminal activities of third persons, based upon the alleged negligence of the defendant Hilton Hotels Corporation in failing to provide adequate security. We reverse the judgment and remand the case to the trial court.
In mid-August of 1975 appellant attended a business convention at the Shamrock Hilton Hotel (the hotel), one of appellee's hotels. On the evening of August 17, 1975, appellant arrived by automobile at the hotel, paid a parking fee of $1.00, and parked in a parking lot owned by and located directly in front of the hotel. After attending the evening convention activities in the hotel appellant left the hotel building and went to his automobile in the parking lot at approximately 11:30 P.M. As he reached his automobile he was accosted by two unknown assailants, beaten, stabbed, and robbed. He was rendered unconscious and *625 awoke in his automobile some distance from the hotel in the early hours of the morning of August 18.
Appellant brought suit against appellee to recover damages based upon the alleged negligence of the hotel in failing to supply adequate protection in the form of guards or other security measures, in failing to warn appellant of any possible danger, and in failing to take other necessary steps to protect appellant. Appellant Insurance Company intervened to recover sums it had paid to appellant Walkoviak for medical benefits and workmen's compensation benefits.
Appellee filed a motion for summary judgment asserting that negligence had not been shown in connection with the circumstances producing the injury. Appellee further asserted that the criminal attack by unknown assailants constituted a new and independent intervening cause totally disassociated with any act or omission on its part. Appellee argued that therefore it was absolved as a matter of law from any liability for the injuries to appellant. The trial court granted appellee's motion for summary judgment and this appeal followed.
Appellee's motion for summary judgment first urged that appellant had not shown negligence on the part of appellee in connection with the circumstances which produced the injury. The proprietor of a public business establishment has the duty to exercise reasonable care to protect his patrons from intentional injuries caused by third persons if he has reason to know that such acts are likely to occur, either generally or at some particular time. Liability for injuries may arise from the failure of the proprietor to exercise reasonable care to discover that such acts by third persons are occurring, or are likely to occur, coupled with the failure to provide reasonable means to protect his patrons from the harm or to give a warning adequate to enable the patrons to avoid the harm. Morris v. Barnette, 553 S.W.2d 648 (Tex.Civ.App.Texarkana 1977, writ ref'd n. r. e.); Eastep v. Jack-in-the-Box, Inc., 546 S.W.2d 116 (Tex. Civ.App.Houston [14th Dist.] 1977, writ ref'd n. r. e.); Restatement (2d) of Torts § 344 (1965). See Adams, Security Against Criminal Acts: The Landlord's New Liability, 42 Texas Bar Journal 201 (March 1979). Under Texas law an innkeeper is not an insurer of the safety of his guests. An innkeeper's responsibility to his guests consists of the duty to exercise ordinary or reasonable care in conformity with the principles discussed above. Nixon v. Royal Coach Inns of Houston, 464 S.W.2d 900, 902 (Tex.Civ.App.Houston [14th Dist.] 1971, no writ); Montfort v. West Texas Hotel Co., 117 S.W.2d 811, 812 (Tex.Civ.App.El Paso 1938, writ ref'd).
We have reviewed the summary judgment evidence and have found several respects in which questions of fact exist which are material to the issue of whether the hotel was negligent in connection with the circumstances which produced appellant's injuries:
(1) The deposition of John E. Colacino, who was employed by the Shamrock Hilton as a security guard at the time of the attack on the appellant and was head of that security system when his deposition was taken, states that he made no conscious effort to find out anything about the crime situation in the area immediately surrounding the hotel.
The appellee's answers to interrogatories show that the police were called to the hotel twice in the twelve months preceding the attack on appellant due to robberies in the vicinity of the hotel. In one of these the victim, a guest of the hotel, had been robbed on Holcombe Boulevard, and in the other the victim was assaulted, robbed and injured on Montclair Street and was assisted into the hotel, where hotel employees called the police. A map of the hotel attached to the interrogatories showed that the hotel occupies a triangle of land bordered by Montclair Street, Holcombe Boulevard, and Main Street. The parking lot where appellant was assaulted borders Holcombe and extends close to Main Street. It would be reasonable to infer that if two such incidents occurred in such close proximity *626 to the hotel that the victims came or were brought to the hotel for help, the hotel was then aware of facts which should`have prompted it to ascertain the extent of such crimes in the immediate area in order to determine what security measures would be necessary to protect its guests from potential assaults within the perimeters of the hotel's own property.
(2) The deposition of Colacino also states that it was common for off-duty policemen to be hired to bolster the hotel's own security force when large conventions were held at the hotel. He states that the convention attended by appellant was considered a large convention. Colacino had no knowledge of whether any extra security personnel were hired for that convention. Appellee, in its answer to the interrogatory which requested the names, addresses, hours worked, and specific areas of responsibility of "all security personnel of the Shamrock Hilton" on the date of the incident, listed only four men, one for each of the three shifts for the twenty-four hours of that date, and one who was on vacation at the time. There is no evidence to show that any extra security personnel were hired to bolster the hotel's own security force at the time of a large convention in accord with the hotel's own security policy. This establishes facts from which a jury could infer that the hotel was negligent in not following its own established standards of care.
(3) The affidavit of D. A. Miller, an expert by experience and education in the matter of providing security, states that in his opinion, based on his training, education, and experience, it would take more than one guard per shift to adequately patrol a hotel the size of the Shamrock Hilton in the evening hours. Colacino's deposition and appellee's answers to interrogatories show that only one guard per eight hour shift was employed by the hotel.
(4) Miller further stated in his affidavit that to properly patrol the hotel a reasonable and careful security person would patrol all of the grounds of the hotel, including the parking lot. Colacino's deposition shows that the hotel's security guards would walk the five floors of the hotel garage, and then "check" the parking lot by looking down the aisles, but would not go up and down the aisles.
We believe that the evidence, when viewed in light of Miller's affidavit, is sufficient to raise issues of fact as to whether the hotel, at the time appellant was assaulted, conducted its security measures in accordance with the standards required of a reasonable and prudent innkeeper in the same or similar circumstances. Such issues are to be resolved by the trier of fact, and are not proper issues to be determined as a matter of law in a summary judgment proceeding.
Appellee in its brief raises two objections to Miller's affidavit. First, it is argued that there is no place in summary judgment procedure for opinion evidence from expert witnesses, citing Gloor v. United States Fire Ins. Co., 457 S.W.2d 925 (Tex.Civ.App.Beaumont 1970, writ ref'd n. r. e.). Gloor was decided before the amendment to Rule 166-A which now provides:
A summary judgment may be based on uncontroverted testimonial evidence of an interested witness, or of an expert witness as to subject matter concerning which the trier of fact must be guided solely by the opinion testimony of experts, if the evidence is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and could have been readily controverted.
(Emphasis added) Tex.R.Civ.P. Rule 166-A(c). Clearly, if a summary judgment may be granted based upon the opinions of expert witnesses, such opinions also have a place in precluding a summary judgment by raising issues of fact material to the elements of a non-movant's cause of action.
Appellee also contends that Miller's affidavit was insufficient because it was sworn to only to the best of his knowledge and belief rather than on personal knowledge as required by Rule 166-A(e). Appellee did not raise such objection at the time of the summary judgment hearing. Rule 166-A(e) states: "Defects in the form of *627 affidavits or attachments will not be grounds for reversal unless specifically pointed out by objection by an opposing party with opportunity, but refusal, to amend." Appellee argues that it is not relying upon the defect in this affidavit as a ground for reversal of the summary judgment, but as a ground for affirmance, and therefore should be allowed to raise this objection for the first time on appeal. We do not agree with appellee's interpretation of this rule. The clear policy behind this portion of Rule 166-A(e), which was a recent amendment, is to provide that all formal objections to summary judgment evidence be raised in the trial court and the opposite party be given an opportunity to correct these formal defects prior to a decision on the summary judgment motion by the trial court. We fail to see the distinction between requiring timely objection to formal defects in affidavits which would establish the movant's right to summary judgment, and requiring timely objections to such deficiencies in affidavits which would preclude the movant's right to summary judgment. Appellee's argument is not well taken and we find that its objection to the form of Miller's affidavit cannot be raised for the first time in this appeal.
Appellee relies most heavily upon this court's opinion in Nixon v. Royal Coach Inn of Houston, supra, to establish its right to a summary judgment based upon the theory that the criminal acts of unknown third persons constitute an independent intervening cause between any act or omission of the hotel and the injuries to appellant. In Nixon the plaintiff, a young woman, was assigned to a room in the defendant hotel which she alleged was remote from the main desk. Upon reaching the door to her room she was attacked by an unknown assailant and injured. She brought suit against the hotel claiming negligence in "billeting a single woman in a remote room in a desolate area of the motel" and in failing to furnish adequate guards for the protection of guests of the motel. Summary judgment was granted for the defendant motel and this court affirmed that judgment. Appellee asserts that the facts of Nixon are very similar to the facts in this case. A careful reading of our opinion in Nixon shows, however, that the evidence there presented was quite different. The record in Nixon consisted only of the plaintiff's original petition, the defendant's original answer, defendant's unsworn motion for summary judgment, plaintiff's unsworn response to such motion, and the plaintiff's deposition. We stated, "[A]n assault by an unknown assailant under the instant record permits no other conclusion except that it was a new and intervening cause altogether disassociated with any act of omission or commission on the part of appellee" (emphasis added). The appellee in the case at bar relies upon this phrase to establish his right to prevail here. Appellee's argument is tantamount to a claim that there can be no liability on the part of a hotel for any assault upon a guest by an unknown third person which occurs on the property of the hotel or motel. We do not so read Nixon. We stated in Nixon that the allegation of negligence was "most tenuous", there being cited no authority requiring an innkeeper to assign any guests to any particular part of a hotel or motel. We found further that the plaintiff had wholly failed to show by summary judgment evidence that she was in fact billeted in a remote or desolate area of the motel. Our finding of "a new and intervening cause altogether disassociated with any act of omission or commission on the part of" the hotel was based upon our conclusion that there was no evidence that the act claimed to constitute the alleged negligence in that case was in fact done by the defendant motel. The decision in Nixon was not based upon a finding that there was a new and independent cause breaking the causal connection between an alleged negligent act of the defendant hotel and the injury to the plaintiff, as appellee would have us hold in this case.
As discussed above, appellant's summary judgment evidence raised a fact issue as to whether the hotel acted as a reasonable innkeeper in providing security for its guests under the circumstances. Evidence of inadequate security would be some indication *628 of "negligence on the part of the innkeeper in connection with the very circumstances which produced the injury". Nixon, supra, at 902. The injury to appellant resulted from criminal acts of persons who invaded the premises of the innkeeper. Such invasion by criminals is an occurrence which the security measures of a hotel should reasonably be designed to prevent.
Once the plaintiff had introduced some evidence that the innkeeper in fact committed the acts or omissions which he has alleged to be negligence (as was not done by the plaintiff in Nixon) then the question of whether the acts of the third persons constitute new and intervening causes is a part of the foreseeability element of the issue of proximate cause. "Ordinarily [of course,] the question of whether an act of negligence was a proximate cause of the consequences presents an issue for determination by the fact finder." Clark v. Waggoner, 452 S.W.2d 437 (Tex.Sup.1970). The foreseeability issue under the circumstances before us should be decided by the trier of fact.
Under Rule 166-A, Tex.R.Civ.P., the party moving for summary judgment has the burden of establishing that there exists no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Summary judgment should be granted only if the summary judgment record establishes a right thereto as a matter of law. Gibbs v. General Motors Corporation, 450 S.W.2d 827, 828 (Tex.Sup.1970). Appellee has failed to sustain this burden and therefore summary judgment was improper.
We reverse the judgment of the trial court and remand the cause for a new trial. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1398016/ | 154 S.W.3d 634 (2005)
DOCTORS HOSPITAL 1997, L.P. d/b/a Doctors Hospital Tidwell, Appellant,
v.
SAMBUCA HOUSTON, L.P. d/b/a/ Sambuca, Appellee.
No. 14-04-00079-CV.
Court of Appeals of Texas, Houston (14th Dist.).
October 28, 2004.
Rehearing Overruled January 13, 2005.
*635 Murphy S. Klasing, Houston, for appellant.
Dean Miles Blumrosen, Houston, for appellee.
Panel consists of Chief Justice HEDGES and Justices FOWLER and SEYMORE.
OPINION
WANDA McKEE FOWLER, Justice.
Show Business Entertainment, a music band, prevailed in its suit against Sambuca, a restaurant, and Doctors Hospital, the host of a party at Sambuca, when neither paid the band for playing at a Christmas party. Sambuca, in turn, successfully claimed that Doctors Hospital was responsible for the band's fees. On appeal, Doctors Hospital complains only about attorney's fees awarded to Sambuca. First, it asserts the fees should not have been awarded because Sambuca recovered on a promissory estoppel claim, not a contract claim, and second, it argues the court should not have reopened the evidence to receive testimony about Sambuca's attorney's fees. We modify the judgment to delete the attorney's fee award because Sambuca recovered on its promissory estoppel claim, which, under Texas law, is available to a claimant only when a valid contract does not exist, and the attorney's fee statute is limited to valid contract claims.
FACTUAL AND PROCEDURAL BACKGROUND
Sambuca and Doctors Hospital disputed who should have paid Show Business Entertainment for playing at the Christmas party. When no one paid, Show Business Entertainment brought suit against both parties. Sambuca ultimately paid the band and cross-claimed against Doctors Hospital, alleging that Doctors Hospital was responsible for the band's fee. After both parties rested their cases and closed, the judge announced his decision in favor of Sambuca and asked the parties to submit a judgment. Sambuca prevailed only on its promissory estoppel theory, although it had also pleaded breach of contract, and the judge awarded attorney's fees to Sambuca. Sambuca's counsel then received permission from the court to reopen briefly to testify over Doctors Hospital's objection about anticipated attorney's fees in the event of an appeal.
ANALYSIS
I. Does a Promissory Estoppel Theory of Recovery Support an Attorney's Fee Award Under Texas Civil Practice and Remedies Code Section 38.001(8)?
In its first point of error, Doctors Hospital asserts that section 38.001(8) of the Texas Civil Practice and Remedies Code does not permit the court to award attorney's fees to a party that prevails on a promissory estoppel theory of recovery. Because determining whether a statute provides for attorney's fees is a question of law, our review is de novo. Holland v. Wal-Mart Stores, Inc., 1 S.W.3d 91, 94 (Tex.1999) ("The availability of attorney's *636 fees under a particular statute is a question of law for the court."). Like other courts to consider this issue, we note there is no controlling Texas case. We also acknowledge that we are the first court to hold as we do. But, because the statute's plain language includes only valid contract claims, and because promissory estoppel does not create a contract, and, in fact, can be successful only when no valid contract exists, we conclude section 38.001(8) does not permit a promissory estoppel claimant to recover attorney's fees.
A Section 38.0001(8) Provides for Recovery of Attorney's Fees When a Party Has a Valid Contract Claim.
Section 38.001(8) allows a party to recover its "reasonable attorney's fees ... in addition to the amount of a valid claim and costs, if the claim is for ... an oral or written contract." Tex. Civ. Prac. & Rem.Code § 38.001(8). Section 38.001's most basic requirement is that the party seeking attorney's fees must first prevail on a valid contract claim. Mustang Pipeline Co., Inc. v. Driver Pipeline Co., Inc., 134 S.W.3d 195, 201 (Tex.2004) (party not entitled to attorney's fees under 38.001 because they did not have a valid contract claim); Sikes v. Zuloaga, 830 S.W.2d 752, 753 (Tex.App.-Austin 1992, no writ) (recovery of valid claim in suit on a contract required to recover attorney's fees under 38.001); Huddleston v. Pace, 790 S.W.2d 47, 51 (Tex.App.-San Antonio 1990, writ denied) (condition precedent to attorney's fee recovery is pleading and proof of a valid claim); see also In re Southland Corp., 19 F.3d 1084, 1088 (5th Cir.1994) (statutory language requires a valid claim).
B. In Texas, a Promissory Estoppel Claim and a Contract Claim are Mutually Exclusive.
For many years, Texas courts have held that promissory estoppel becomes available to a claimant only in the absence of a valid and enforceable contract. See Montgomery Indus. Int'l, Inc. v. Thomas Constr. Co., Inc. 620 F.2d 91, 95 (5th Cir.1980) ("Where there is actually no contract the promissory estoppel theory may be invoked....") (citing Wheeler v. White, 398 S.W.2d 93, 97 (Tex.1966)); Subaru of Amer., Inc. v. David McDavid Nissan, Inc., 84 S.W.3d 212, 226 (Tex.2002) ("[T]he promissory-estoppel doctrine presumes no contract exists....") (citing Wheeler, 398 S.W.2d at 96-97); Superior Laminate & Supply, Inc. v. Formica Corp., 93 S.W.3d 445, 449 (Tex.App.-Houston [14th Dist.] 2002, pet. denied) ("Promissory estoppel operates to enforce an otherwise unenforceable promise; `[i]t cannot replace an enforceable contract.'") (citing Vogel v. Travelers Indem. Co., 966 S.W.2d 748, 754 (Tex.App.-San Antonio 1998, no pet.)); Richter, RMS v. Wagner Oil Co., 90 S.W.3d 890, 899 (Tex.App.-San Antonio 2002, no pet.) ("Promissory estoppel is not applicable to a promise covered by a valid contract....") (citation omitted); Stable Energy, L.P. v. Kachina Oil & Gas, Inc., 52 S.W.3d 327, 336 (Tex.App.-Austin 2001, no pet.) ("If an alleged promise is part of a valid contract, the promisee cannot disregard the contract and sue... under the doctrine of promissory estoppel.") (citation omitted); Fretz Constr. Co. v. So. Nat'l Bank of Houston, 600 S.W.2d 878, 880 (Tex.App.-Houston [1st Dist.] 1980) (describing the "law [as] being settled that promissory estoppel and a contract cannot exist simultaneously") (citing Wheeler, 398 S.W.2d at 93) (overruled on other grounds, 626 S.W.2d 478 (Tex.1981)); Pasadena Assocs. v. Connor, 460 S.W.2d 473, 481 (Tex.App.-Houston [14th Dist.] 1970, writ ref'd n.r.e.) ("The written contract in this case renders the doctrine of promissory estoppel inapplicable.") (citing Prince v. Miller Brewing Co., 434 S.W.2d 232, 240 (Tex.Civ.App.-Houston [1st Dist.] 1968, writ ref'd n.r.e.) ("Because of the valid contract the theory of *637 promissory estoppel is not applicable.")); see also Montgomery Indus. Int'l, Inc., 620 F.2d at 95 (holding that promissory estoppel theory may be invoked when there is actually no contract) (citing Wheeler, 398 S.W.2d at 97). Thus, a claim for promissory estoppel and a contract claim are mutually exclusive claims; a litigant cannot recover on one if it recovers on the other.[1]See, e.g., Barker v. Brown, 772 S.W.2d 507, 510 (Tex.App.-Beaumont 1989, no writ) ("The law is well settled that the doctrine of promissory estoppel is not applicable where there exists a legally valid contract between the parties.") (citing Stewart & Stevenson Servs., Inc. v. Enserve, Inc., 719 S.W.2d 337, 344 (Tex.App.-Houston [14th Dist.] 1986, writ ref'd n.r.e.)).
C. Section 38.001(8) Cannot Include Promissory Estoppel Claims.
If the two previous propositions that section 38.001(8) authorizes attorney's fees only when a party has a valid contract claim, and a party can recover on promissory estoppel only if it does not have a valid contract claim are correct, then they are mutually exclusive remedies. If they are mutually exclusive remedies, then section 38.001(8) cannot include a promissory estoppel claim. Were we to hold otherwise, we would have to (1) ignore a long line of cases holding that a recovery under promissory estoppel means no valid contract existed and (2) add a cause of action that the statute's plain language does not include. We intend to do neither of these.
D. The Contrary Case Law Is Not Persuasive.
In holding that a party may not recover attorney's fees on a promissory estoppel claim, we recognize that we are a lone voice. See Preload Tech., Inc. v. AB & J Constr. Co., Inc., 696 F.2d 1080 (5th Cir.1983); Traco, Inc. v. Arrow Glass Co., Inc., 814 S.W.2d 186 (Tex.App.-San Antonio 1991, writ denied); Adams v. Petrade Int'l, 754 S.W.2d 696 (Tex.App.-Houston [1st Dist.] 1988, writ denied); Safe Env., Inc. v. Pelzel & Assocs., Inc., No. 03-98-00721-CV, 1999 WL 815819 (Tex.App.-Austin Oct.14, 1999, no pet.) (not designated for publication); DeNucci v. Moretti, No. 03-98-00114-CV, 1999 WL 250141 (Tex.App.-Austin Apr. 29, 1999, pet. dism'd by agr.) (not designated for publication). However, the Texas cases holding that attorney's fees may be recovered generally stem from one case: Preload, 696 F.2d at 1084-85, 1093-95. Preload was the first case to address this dilemma. Noting that no Texas case had addressed the issue, it turned to section 90 of the Restatement (Second) of Contracts. Id. at 1094-95. Section 90 addressed promissory estoppel; comment d provided that a binding promise under that section was a contract. Restatement (Second) of Contracts § 90 cmt. d (1981). Without considering the Texas rule that promissory estoppel claims and contract claims are mutually exclusive, the court concluded that section 38.001(8) includes promissory estoppel claims because the restatement treats at least some of these claims as contracts. Preload, 696 F.2d at 1093-95.
When Texas courts have concluded that section 38.001(8) includes promissory estoppel, they have relied upon Preload to some extent. See Traco, Inc., 814 S.W.2d at 193-94 (relying on Preload); Adams, 754 S.W.2d at 720 (relying on Preload); Safe Env., Inc., 1999 WL 815819 at *3 (citing Traco, Inc., Adams, and Preload); DeNucci, 1999 WL 250141 at *9 (relying *638 on Traco, Inc. and Preload). The Restatement notwithstanding, as recently as 2002, the Texas Supreme Court held that the "promissory estoppel doctrine presumes no contract exists." Subaru, 84 S.W.3d at 226 (citing Wheeler, 398 S.W.2d at 96-97).
We think the Texas cases allowing attorney's fees probably did so because the parties did not join the issue as directly as the parties before us. None of the cases discuss Texas' long history of treating contract claims and promissory estoppel claims as mutually exclusive remedies. See Preload, 696 F.2d 1080; Traco, Inc., 814 S.W.2d 186; Adams, 754 S.W.2d 696; Safe Env., Inc., 1999 WL 815819; DeNucci, 1999 WL 250141. Most likely, the parties did not bring that point to the courts' attention. Had the issue been joined with one party pointing out that a contract claim and a promissory estoppel claim are mutually exclusive the outcome would have been different. For this reason, we refuse to follow these cases.
E. Construing the Statute Liberally does NOT Include Adding a Cause of Action.
We finally consider the last reason some courts have given for allowing attorney's fees on a promissory estoppel claim: the statute's requirement that it should be construed liberally. Tex. Civ. Prac. & Rem.Code § 38.005. Some courts allowing a party to recover attorney's fees on a promissory estoppel claim have relied on this admonishment that we construe the statute liberally. Preload, 696 F.2d at 1093; Traco, Inc., 814 S.W.2d at 193; Adams, 754 S.W.2d at 720; and for liberal construction mandate, see Tex. Civ. Prac. & Rem.Code § 38.005; McKinley v. Drozd, 685 S.W.2d 7, 11 (Tex.1985) (recognizing former strict construction and amendment mandating liberal construction). As with the Restatement, we also think this argument is misplaced. When the legislature mandates us to construe a chapter liberally, it does not give us authority to substantively change the statute. Yet, adding an entirely new cause of action to the statute would substantively change it. In requiring liberal construction, we think the legislature did not intend to authorize the courts to substantively change the statute and broaden the causes of action included in the statute. Nothing in the statute itself suggests this; it very precisely lists the causes of action that will support attorney's fees.
Some Texas courts construing the statute have applied the liberal interpretive mandate in procedural settings. This is a good example of what the legislature meant when it told the courts to construe the statute liberally. For example, courts have relied on the liberal construction mandate to permit an attorney's fee recovery even without a net recovery. See McKinley, 685 S.W.2d at 10-11 (proper construction allows attorney's fee recovery even if claim's amount entirely offset by an opposing party's claim because of legislative intent to discourage unnecessarily litigation, encourage defense of a just claim, and legislative mandate to construe chapter liberally). Courts have also allowed an attorney's fee recovery without requiring a particular form of presentment. Adams, 754 S.W.2d at 719-20 (citing liberal construction mandate and allowing attorney's fee recovery when presentment was made by invoice and amount differed from recovery at trial).
In short, the requirement to construe the statute liberally does not mean that we are at liberty to add new causes of action to the statute. When the legislature required the courts to construe the statute liberally, it is reasonable to assume the legislature contemplated procedural issues, not substantive issues. When the legislature codified the attorney's fees statute *639 and required it to be liberally construed, McKinley, 685 S.W.2d at 11, Texas case law held that promissory estoppel and contract claims were mutually exclusive theories of recovery. See Wheeler, 398 S.W.2d at 97. The legislature could have added promissory estoppel as a claim for which a party could recover attorney's fees, but it did not.
Thus, even mindful of the legislative mandate to construe section 38.001 liberally, we find that section 38.001(8) does not authorize the award of attorney's fees to a promissory estoppel claimant. See Wesco Distrib., Inc. v. Westport Group, Inc., 150 S.W.3d 553, 557 (Tex.App.-Austin 2004, no pet. h.) (not designated for publication) ("Liberal interpretation of a statute does not permit doing violence to the language in the statute.") (citing Deep E. Tex. Reg'l Mental Health & Mental Retardation Servs. v. Kinnear, 877 S.W.2d 550, 563 (Tex.App.-Beaumont 1994, no writ)). The plain language of section 38.001(8) allows the court to award attorney's fees only when a party has a valid oral or written contract claim. See Tex. Civ. Prac. & Rem.Code § 38.001(8). When a party recovers on a promissory estoppel claim, it does not have a valid contract claim.
As attorney's fees should not have been awarded, the appellant's complaint that the trial court should not have reopened the evidence to permit additional testimony about attorney's fees is moot. We modify the judgment to delete the attorney's fee award and affirm as modified.
NOTES
[1] A claim for quantum meruit and a contract claim are juxtaposed in the same way: they are mutually exclusive. Richter, 90 S.W.3d at 894 ("A party may recover under quantum meruit only when there is no express contract....") (citing Vortt Exploration Co. v. Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex.1990)). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1204986/ | 485 S.E.2d 563 (1997)
226 Ga. App. 21
WATSON
v.
SIERRA CONTRACTING CORPORATION.
No. A97A0433.
Court of Appeals of Georgia.
April 3, 1997.
*565 Holland & Knight, Elizabeth C. Helm, Caroline W. Johnson, Atlanta, for appellant.
Ashenden, Flynn & Gottlieb, Jon A. Gottlieb, Atlanta, for appellee.
*564 ELDRIDGE, Judge.
Watson at North Point, Inc. (Watson, Inc.) is a Georgia corporation that owned and operated a retail store at North Point Mall under the registered trade name "Mon Petit Chou," which was not registered until October 7, 1993. Between 1987 and 1994, Mon Petit Chou, Inc. operated a retail store at Phipps Plaza; Susan W. Watson was the president of Mon Petit Chou, Inc., which was incorporated in 1985. In 1987, appellee Sierra Contracting Corporation entered into a contract to build out the retail space for Mon Petit Chou, Inc. at Phipps Plaza; the contract to do the work had been negotiated with appellee on behalf of Mon Petit Chou, *566 Inc. by appellant as corporate president, and payment was made by such corporation.
In April 1993, appellant Watson was approached by the landlord at Phipps Plaza about Mon Petit Chou, Inc. opening another store at their new mall at North Point Mall, because Mon Petit Chou, Inc. was a tenant of theirs at Phipps. Appellant became president of Watson, Inc. after its incorporation on June 18, 1993. On June 22, 1993, Watson, Inc. was entered on the lease for the retail space in North Point Mall in place of Mon Petit Chou, Inc. and the lease was executed by appellant as president of Watson, Inc.
Appellant testified that, early in 1993, probably on or before April 18, 1993, and prior to executing the North Point Mall lease on June 22, 1993, in her corporate officer capacity for Watson, Inc., she began discussions with Larry Wolfe, representing appellee, regarding the build-out of the retail space at North Point Mall once the lease was signed. The meeting took place approximately six to eight months prior to the opening of the North Point store on October 20, 1993. Wolfe suggested to appellant that the architectural firm Holland Architects, P.C. be used to design the layout, and a contract was signed with Holland Architects, P.C. to design the layout. However, the contract was entered into between Mon Petit Chou, Inc. and Holland Architects, P.C. Appellant testified that, during this initial meeting with Wolfe and the architect, Steve Holland, appellant explained to Wolfe the corporation's financial restraints of $50,000 to be paid by the landlord for the build-out and the time constraints of the lease as set by the landlord upon the corporate tenant, Watson, Inc. Appellant did not specifically identify the corporation as Watson, Inc. To receive $25,000 of the $50,000 build-out fund from the landlord, the tenant had to open by a certain date or such funds would not be available under the lease; no agreement was reached at this meeting.
The record demonstrates that, in total, the discussions and arrangements between Wolfe and appellant were very vague. Appellant testified that no agreement was reached as to the essentials of the contract: the specific work to be performed, the price for the work, or the performance and completion date for the work. Wolfe indicated to appellant early in the discussions that the build-out would probably exceed the landlord construction allowance of $50,000 and be around $70,000. Appellant had expected to pay the excess $20,000 from a bank loan she was unable to obtain after making a loan application to two or three banks. Wolfe, Holland, and appellant met two or three times to come to some agreement as to the nature and extent of the work to be performed. However vague the discussion, appellee was authorized to proceed to do the build-out work on the retail space, and on April 18, 1993, a contract for architectural services was entered into between Mon Petit Chou, Inc., executed by appellant, and Holland Architects, P.C. to design the layout for the "Mon Petit Chou Store at North Point Mall ... interior design for build-out of a new retail space."
According to appellant's testimony, during the initial meeting with Wolfe, appellant told him that there would be a new corporate entity, that she was starting a "whole new business," and that there would be a new corporate address. However, appellant never told either the architect or Wolfe at the first meeting that she was acting on behalf of Watson, Inc., because appellant assumed that Wolfe would know that she was representing the business and not herself individually.
The plans and details for the build-out were not completed until August 24, 1993, when appellee began work. On September 27, 1993, appellee made a draw request of $40,299 for all the work performed from August 24, 1993 through September 27, 1993; Watson, Inc. paid appellee $25,000 by a counter check, dated October 31, 1993, and drawn on the Watson, Inc. bank account because no corporate checks had been printed at that time and the counter check did not have the corporate name and had only appellant's signature. Watson, Inc. was not incorporated until June 18, 1993. Appellant, in her own name, also purchased a chandelier from Georgia Lighting, which was installed in the North Point store.
Appellant denied that she individually entered into any express contract with appellee or that appellee ever gave to her any indication *567 that appellee believed that appellant was acting in an individual capacity. All appellee's correspondence to appellant was sent to the business address of Watson, Inc., although it was not addressed to the corporation but to its registered trade name, Mon Petit Chou, which was not registered until October 7, 1993. Such correspondence was dated September 27, 1993, and November 15, 1993. Appellant never paid appellee individually; only Watson, Inc. paid appellee.
On March 18, 1994, appellee sued Watson, Inc. d/b/a Mon Petit Chou for the unpaid balance of the labor, costs, and materials for the build-out of the retail space at North Point Mall in the amount of $70,250 for work done between August 24, 1993 and December 7, 1993, on an open account under OCGA § 7-4-16, quantum meruit under OCGA § 9-2-7, as well as costs of litigation under OCGA § 13-6-11. Watson, Inc. went into default by not responding. Appellee moved on January 23, 1995, to amend and to add as additional parties appellant and her husband contending that they were the parties with whom oral contracts had been entered into by appellee. By order filed on February 28, 1995, the additional parties were added. On July 24, 1995, appellee filed a motion for partial summary judgment against appellant, seeking a determination as a matter of law that appellant hired appellee to perform construction services; that appellee performed the services; and that appellant is indebted to appellee for such services. On November 21, 1995, the trial court granted partial summary judgment for appellee and against appellant. Notice of appeal was filed on November 21, 1995. The appeal was docketed on October 16, 1996.
On November 26, 1996, appellee filed a motion for penalty for filing a frivolous appeal. Such petition is hereby denied by this Court.
The sole enumeration of error is that the trial court erred in granting the motion for partial summary judgment for Sierra Contracting Corporation and against Susan Watson as to personal liability for the debts of Watson, Inc.
(a) Appellant's personal liability. "A defendant who will not bear the burden of proof at trial need not affirmatively disprove the nonmoving party's case; instead, the burden on the moving party may be discharged by pointing out by reference to the affidavits, depositions and other documents in the record that there is an absence of evidence to support the nonmoving party's case. If the moving party discharges this burden, the nonmoving party cannot rest on its pleadings, but rather must point to specific evidence giving rise to a triable issue." Lau's Corp. v. Haskins, 261 Ga. 491, 405 S.E.2d 474 (1991).
"The rule in Georgia is that the testimony of a party who offers [herself] as a witness in [her] own behalf at trial `"is to be construed most strongly against [her] when it is self-contradictory, vague or equivocal."' Douglas v. Sumner, 213 Ga. 82, 85, 97 S.E.2d 122 (1957); W & A Railroad Co. v. Evans, 96 Ga. 481, 23 S.E. 494 (1895). Where the favorable portion of a party's self-contradictory testimony is the only evidence of [her] right to recover or of [her] defense, the opposing party is entitled to a directed verdict. Douglas v. Sumner, supra.... Early on the courts determined that if on summary judgment a party offered self-contradictory testimony on the dispositive issue in the case, and the more favorable portion of [her] testimony was the only evidence of [her] right to a verdict in [her] favor, the trial court must construe the contradictory testimony against [her]. This being so, the opposing party would be entitled to summary judgment. The courts reasoned that this is the correct result because if the case went to trial under the same evidence, the party offering self-contradictory testimony would have a verdict directed against [her]. Dykes v. Hammock, 116 Ga.App. 389, 157 S.E.2d 524 (1967). Once the trial court has eliminated the favorable portions of the contradictory testimony, it must take all testimony on motion for summary judgment `as it then stands, and construe it in favor of the party opposing the motion in determining whether a summary judgment should be granted.' Chandler v. Gately, 119 Ga.App. 513, 514, 167 S.E.2d 697 (1969). The courts concluded that this rule must necessarily be applied to summary judgment proceedings, otherwise, `any opposing *568 party may, by the simple device of filing conflicting affidavits, get the motion denied. The temptations to perjury are greater in this situation than in a jury trial ... The conflict can easily be avoided. A party knows what [she] has sworn. If [she] has discovered error, it can be explained in [her] affidavit.' [Id.] at 523 [167 S.E.2d 697].... Burnette Ford[, Inc.] v. Hayes, [227 Ga. 551, 181 S.E.2d 866 (1971)], states the general rule that on motion for summary judgment all evidence is to be construed against the movant.... We conclude therefore that both Chambers v. C & S [Nat. Bank], 242 Ga. 498, 249 S.E.2d 214 (1978), which applied the contradictory testimony rule to a motion for summary judgment, and Combs v. Adair Mortgage Co., 245 Ga. 296, 264 S.E.2d 226 (1980), which distinguished Chambers from Burnette Ford, were correctly decided. Accord King v. Brasington, [252 Ga. 109, 312 S.E.2d 111 (1984)]." (Footnote omitted.) Prophecy Corp. v. Charles Rossignol, Inc., 256 Ga. 27, 28-30(1), 343 S.E.2d 680 (1986).
To determine if testimony is contradictory, "[t]he standard to be applied is: (1) determine whether the testimony of the party is contradictory, (2) if a reasonable explanation is offered for the contradiction, that testimony will not be construed against the party, (3) the burden is on the party giving the testimony to offer a reasonable explanation, and (4) whether this has been done is an issue of law for the trial judge." Thacker v. Matthews Tuxedo, 183 Ga.App. 474, 475, 359 S.E.2d 231 (1987). It must be inferred that the trial court went through such analysis prior to granting summary judgment where the conflict goes to the essential facts supporting appellant's defense, no explanation for the conflict appears in the record, and the trial court took the least favorable testimony of the appellant that was in conflict.
Appellant's testimony is conflicting as to what she told Wolfe and Holland during the first meeting on April 18, 1993, and when other information was allegedly imparted. For example, appellant testified that she told Wolfe and Holland that she was acting not in her personal capacity but in a representative capacity for Watson, Inc., even though Watson, Inc. did not come into legal existence until June 18, 1993. Other conflicts include her explanation of why, in early April 1993, the landlord at Phipps Plaza, who was building North Point Mall, wanted Mon Petit Chou, Inc. to open a store there even though the lease in the name of Mon Petit Chou, Inc. and the architect contract with Mon Petit Chou, Inc. were really contracts with Watson, Inc. under the registered trade name Mon Petit Chou, a trade name which was not even registered until October 7, 1993. Finally, appellant asserted that Wolfe knew that Watson, Inc. was the legal entity because appellee cashed the counter check with no corporate name or address on it which was drawn on the Watson, Inc. account or because letters to appellant addressed to Mon Petit Chou at 3500 Peachtree Road indicated an awareness of this address as Watson, Inc.'s corporate address, as well as the corporate address of Mon Petit Chou, Inc. While appellant's most favorable testimony created a material issue of fact, appellant's denial that she acted on her own behalf or on behalf of any entity other than Watson, Inc. directly conflicts with her other testimony describing what she signed and what she did. The trial court was correct in construing her testimony to show that she had never revealed or disclosed that she was acting as an agent for an undisclosed principal, Watson at North Point, Inc. d/b/a Mon Petit Chou, which did not come into legal existence until June 18, 1993, and did not register the trade name until October 7, 1993, long after the meetings and negotiations had taken place. Appellant produced no evidence that she disclosed to appellee or the architect after June 18, 1993, that they were dealing with Watson, Inc., which thereafter had corporate existence. While the actual work performed by appellee occurred after August 24, 1993, and continued until December 7, 1993, at the North Point Mall store location leased by Watson, Inc., the appellant has failed to rebut appellee's evidence that appellee was ever made aware of the identity of the beneficiary of such work.
The proper legal analysis of the case sub judice is under agency. Under OCGA § 10-6-54, a party dealing with the agent of *569 another, undisclosed principal has an action either against the principal or the agent. Kingsberry Homes v. Findley, 242 Ga. 362, 364(2), 249 S.E.2d 51 (1978).
"In order to avoid personal liability an agent is under a duty to disclose the fact of his agency and the identity of his principal, and one who deals with an agent who fails to disclose his principal may at his election recover from either the agent or the principal. The disclosure of an agency is not complete for the purpose of relieving the agent from personal liability unless it embraces the name of the principal." (Citations and punctuation omitted.) Reed v. Intl. Security Svc., 215 Ga.App. 60, 449 S.E.2d 888 (1994); see also Collins v. Brayson Supply Co., 157 Ga.App. 438, 278 S.E.2d 87 (1981); Dinkler Mgmt. Corp. v. Stein, 115 Ga.App. 586, 590, 155 S.E.2d 442 (1967); Brown-Wright Hotel Supply Corp. v. Bagen, 112 Ga.App. 300, 145 S.E.2d 294 (1965); Roberts v. Burnette, 72 Ga.App. 775, 35 S.E.2d 201 (1945).
Appellant, having failed to disclose the identity of her principal throughout the transaction, may be liable instead of the principal at the election of the party vested with the cause of action. See Kingsberry Homes v. Findley, supra at 364, 249 S.E.2d 51. "The contract liability of a principal and his agent is not joint, and after election to proceed against one, the other cannot be held." Id. at 365, 249 S.E.2d 51; see also Charles Lippincott & Co. v. Behre, 122 Ga. 543, hn. 3, 545(3), 50 S.E. 467 (1905); Dinkler Mgmt. Corp. v. Stein, supra at 590, 155 S.E.2d 442; Washburn Storage Co. v. Elliott, 93 Ga.App. 456(2), 92 S.E.2d 28 (1956); Roberts v. Burnette, supra at 777, 35 S.E.2d 201; Willingham, Wright & Covington v. Glover, 28 Ga.App. 394, 396(3), 111 S.E. 206 (1922). An election occurs not when the principal and agent are sued but when final judgment is taken against either; until there exists a final judgment against either the principal or the agent, no irrevocable election has been made. See generally Lippincott & Co. v. Behre, supra at 546-547, 50 S.E. 467. Had appellee taken a default judgment against Watson, Inc., then an election would have been made and no action could be brought against appellant; however, since no judgment has been taken against Watson, Inc., appellant is subject to suit individually.
OCGA § 14-2-204 states that "[a]ll persons purporting to act as or on behalf of a corporation, knowing there was no incorporation under this chapter, are jointly and severally liable for all liabilities created while so acting," and bases such liability on a modification and codification of the common law rules regarding agency. See Weir v. Kirby Constr. Co., 213 Ga.App. 832, 833-834(1), 446 S.E.2d 186 (1994); see also Wells v. J.A. Fay & Egan Co., 143 Ga. 732, 733(1), 85 S.E. 873 (1915). Appellant knew that the corporate charter had not been issued until June 18, 1993, because the execution page of the lease shows her signing the lease July 23, 1993, as president for Mon Petit Chou, Inc., but changing the execution to June 22, 1993, four days after the incorporation of Watson, Inc., to president of Watson, Inc., which clearly demonstrates knowledge of the date of incorporation. However, appellant entered into no binding contracts prior to the incorporation, although appellant told appellee to go ahead with the build-out, which was not a contract but contract formation that never came to fruition and remained too vague and indefinite to constitute an enforceable contract. Thus, efforts to formulate a contract which never came into existence created no potential liability under OCGA § 14-2-204. See Satellite Syndicated Systems v. Henderson, 162 Ga.App. 453, 291 S.E.2d 749 (1982).
The trial court did not err in granting partial summary judgment and finding that appellant could be found individually liable for the construction work performed by appellee. However, the trial court by summary judgment could not find liability under any theory of recovery, because there were disputed material issues of fact under each theory.
(b) Action on open account. An action on open account is a simplified pleading procedure where a party can recover what he was justly and equitably entitled to without regard to a special agreement to pay such amount for goods or services as they *570 were reasonably worth when there exists no dispute as to the amount due or the goods or services received. Johnson v. Quin, 52 Ga. 485 (1874). An action on open account may be brought for materials furnished and work performed. Southern Express Co. v. Hunnicutt & Turner, 5 Ga.App. 262, 63 S.E. 26 (1908). However, if there is a dispute as to assent to the services or to acceptance of the work done or as to what work was to be performed and the cost, then an action on open account is not a proper procedure. Lawson v. O'Kelley, 81 Ga.App. 883, 885(1), 60 S.E.2d 380 (1950); Craig v. Augusta Roofing & Metal Works, 78 Ga.App. 514, 515(1), 51 S.E.2d 565 (1949). A suit on account must be based either on an express or an implied contract. Devine v. Geiger, 100 Ga.App. 245, 110 S.E.2d 687 (1959).
In the case sub judice, there exists no express contract. On the other hand, there may be evidence that can establish an implied contract with appellant because although there never was an agreement as to the terms, compensation, or work, there appears to be acceptance of the work; however, the acceptance of the work performed appears to be for the benefit of another. Furthermore, appellant never agreed to be personally bound and never had a meeting of the minds as to an agreement. See Cox Broadcasting Corp. v. Nat. Collegiate Athletic Assoc., 250 Ga. 391, 395, 297 S.E.2d 733 (1982); Jack V. Heard Contractors v. A. L. Adams Constr. Co., 155 Ga.App. 409, 412, 271 S.E.2d 222 (1980), overruled on other grounds, Southeast Ceramics v. Klem, 156 Ga.App. 636, 275 S.E.2d 723 (1980); Fonda Corp. v. Southern Sprinkler Co., 144 Ga.App. 287, 290(1), 241 S.E.2d 256 (1977). Thus, to the extent that the trial judge found liability on an action on open account, the trial court erred because there remains disputed issues of material fact under such theory of liability for jury determination.
(c) Action for quantum meruit or unjust enrichment. Under OCGA § 9-2-7, this Code section provides an action for quantum meruit where services were rendered and materials were furnished, and which were accepted by and valuable to the recipient; acceptance and benefit conferred upon the recipient gives rise to the presumption of a legal obligation to pay for the value. Quantum meruit is not available when there is an express contract; however, if the contract is void, is repudiated, or can only be implied, then quantum meruit will allow a recovery if the work or service was accepted and if it had value to the recipient. See Stowers v. Hall, 159 Ga.App. 501, 502(3), 283 S.E.2d 714 (1981); Brumby v. Smith & Plaster Co. of Ga., 123 Ga.App. 443, 444(1), 181 S.E.2d 303 (1971).
Even if no express or implied contract arose between the parties, an obligation to pay arises upon the theory of unjust enrichment where a benefit has been conferred upon the party sought to be held liable for the value, which is analogous to quantum meruit in that the duty to pay arises out of the receipt of a benefit. See White v. Arthur Enterprises, 219 Ga.App. 124, 464 S.E.2d 225 (1995); Mabry v. Pelton, 208 Ga.App. 891, 432 S.E.2d 588 (1993); Regional Pacesetters v. Halpern Enterprises, 165 Ga.App. 777, 300 S.E.2d 180 (1983); City of Commerce v. Duncan & Godfrey, Inc., 157 Ga.App. 337, 277 S.E.2d 266 (1981). A party cannot receive and retain the benefit of another's labor without the duty to pay for the reasonable value of such work. See Henry v. Moss, 99 Ga.App. 623, 109 S.E.2d 313 (1959); Woodruff v. Trost, 73 Ga.App. 608, 37 S.E.2d 425 (1946).
Value of services is not to be determined from the perspective of the party rendering the services and materials, but must be determined from the perspective of the recipient to determine to what extent the party was benefited or enriched by such services; otherwise, ineffective, defective, or worthless services could create liability for the recipient. The value of services from the perspective of the recipient is uniquely that of opinion and is for jury determination as to value, if any. Williams v. Claussen-Lawrence Constr. Co., 120 Ga.App. 190, 169 S.E.2d 692 (1969); see also Stowers v. Hall, supra at 502, 283 S.E.2d 714; Fonda Corp. v. Southern Sprinkler Co., supra at 292, 241 S.E.2d 256; Mitchell & Pickering v. Louis Isaacson, Inc., 139 Ga.App. 733, 229 S.E.2d *571 535 (1976); Pembroke Steel Co. v. Technical Sales Assoc., 138 Ga.App. 744, 227 S.E.2d 491 (1976); Brumby v. Smith & Plaster Co. of Ga., supra at 444, 181 S.E.2d 303.
Appellee has available as alternative theories of liability to an action on open account, quantum meruit if there is an implied contract proven or unjust enrichment if there is no implied contract. Each theory must be proven before there is liability by appellant.
To the extent the trial court determined liability under the theory of quantum meruit as a matter of law, the trial court erred because whether or not appellant received any benefit from appellee's work and is liable for such payment is a question of fact for the jury.
Judgment affirmed in part and reversed in part.
BIRDSONG, P.J., concurs.
RUFFIN, J., concurs in judgment only. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4222017/ | IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
SHANNON DOUGLAS NOT FINAL UNTIL TIME EXPIRES TO
ROBINSON, FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
Appellant,
CASE NO. 1D17-0311
v.
FLORIDA COMMISSION ON
OFFENDER REVIEW and
JULIE L. JONES, SECRETARY,
FLORIDA DEPARTMENT OF
CORRECTIONS,
Appellees.
_____________________________/
Opinion filed November 20, 2017.
An appeal from the Circuit Court for Leon County.
Terry Lewis, Judge.
Shannon Douglas Robinson, pro se, Appellant.
Rebecca Kapusta, General Counsel, and Beverly Brewster, Assistant General
Counsel, Department of Corrections, Tallahassee, for Appellees.
PER CURIAM.
AFFIRMED. Because of Appellant’s repeated unsuccessful challenges to
denials of postconviction relief and petitions for extraordinary relief, Appellant is
cautioned that the filing of additional meritless appeals could subject him to
sanctions. See State v. Spencer, 751 So. 2d 47 (Fla. 1999); Ardis v. Pensacola
State College, 128 So. 3d 260 (Fla. 1st DCA 2013); § 944.279, Fla. Stat.
ROWE, MAKAR, and BILBREY, JJ., CONCUR.
2 | 01-03-2023 | 11-20-2017 |
https://www.courtlistener.com/api/rest/v3/opinions/1119829/ | 822 P.2d 513 (1991)
Judy C. ALFORD, Plaintiff-Appellee,
v.
John TIPTON, as Executive Director of the Department of Revenue of the State of Colorado, Motor Vehicle Division, Defendant-Appellant.
No. 90CA1792.
Colorado Court of Appeals, Div. V.
November 7, 1991.
*514 No appearance for plaintiff-appellee.
Gale A. Norton, Atty. Gen., Raymond T. Slaughter, Chief Deputy Atty. Gen., Timothy M. Tymkovich, Sol. Gen., Robert C. Ripple, Asst. Atty. Gen., Denver, for defendant-appellant.
Opinion by Judge PLANK.
The Department of Revenue (Department) appeals from the district court judgment reversing its revocation of the driver's license of plaintiff, Judy C. Alford, for refusing to submit to testing as required by the express consent law. We reverse.
The evidence at the revocation hearing established that, on October 20, 1989, plaintiff was the driver of a vehicle involved in a traffic accident. Plaintiff sustained a minor head injury in the accident and was transported to a hospital, where she was held for observation for the next one and one-half days.
At the hospital, about one hour after the accident, the investigating police officer received permission from the treating physician to interview plaintiff. The police officer then questioned plaintiff about the accident and asked her to take a blood alcohol test because he noticed various indications of intoxication. Plaintiff became verbally abusive to the police officer in response to his repeated requests to take a blood test, and she acknowledged that she was refusing to submit to testing.
The police officer subsequently forwarded a completed notice of revocation form and other documents concerning the incident to the Department. The notice of revocation form was signed and sworn to by the police officer before a notary, who also signed and dated the form, but the form was not dated by the investigating police officer.
At the revocation hearing, plaintiff's expert witness, the attending nurse at the hospital, testified that plaintiff's behavior was consistent with that exhibited by patients with closed head injuries and that plaintiff could not make any decisions concerning herself until about four hours after she arrived at the hospital. On cross-examination, *515 however, the nurse also testified that persons who are intoxicated can exhibit exactly the same behavior as that described for persons with closed head injuries and that plaintiff's gradual return to calmness was consistent with either a reduction of closed head injury swelling or a reduction of alcohol in her system.
The hearing officer found that plaintiff had refused to submit to testing and, therefore, ordered the revocation of her driver's license pursuant to § 42-2-122.1, C.R.S. (1984 Repl.Vol. 17).
On review, the district court reversed the revocation on two grounds. First, the district court ruled that, by failing to date the notice of revocation form, the investigating police officer did not comply with the requirements of § 42-2-122.1(2)(a), C.R.S. (1991 Cum.Supp.), applicable here, and that this statutory violation deprived the Department of jurisdiction to order the revocation. The district court also ruled that the evidence was insufficient to sustain the revocation because the evidence weighed evenly, at best, as to whether plaintiff's refusal to submit to testing was caused by her medical condition from her injuries or was caused by her intoxication.
The Department contends that the district court erred in so ruling, and we agree.
I.
As to the police officer's failure to date the notice of revocation form, we reject the Department's argument that § 42-2-122.1(2)(a) does not require dating by the affiant when the form is dated by a notary, but we conclude that this statutory violation is not a jurisdictional defect and does not warrant reversal of the revocation.
Pursuant to § 42-2-122.1(2)(a), C.R.S. (1991 Cum.Supp.), whenever a driver refuses to submit to testing as required by the express consent law, the police officer requesting such testing is required to forward an "affidavit" concerning the incident to the Department. Cf. Colo.Sess.Laws 1988, ch. 293, § 42-2-122.1(2)(b) at 1360 (police officer required to forward "verified report" containing "all relevant information").
As pertinent to the issues here, § 42-2-122.1(2)(a) now provides that the affidavit "shall be dated, signed, and sworn to by the law enforcement officer under penalty of perjury, but need not be notarized or sworn to before any other person." (emphasis added).
Contrary to the Department's argument, the plain meaning of these provisions is that a police officer who signs and swears to an affidavit is required to date the affidavit as well, regardless of whether a notary also signs and dates the affidavit. Thus, since the investigating police officer failed to date the notice of revocation form, which served as the required affidavit here, the district court properly ruled that this omission was in violation of the statutory requirements.
Nevertheless, contrary to the district court's analysis, we conclude that this statutory violation did not deprive the Department of jurisdiction over the revocation proceedings. Rather, under the statutory scheme as a whole, we conclude that substantial compliance with the requirements of § 42-2-122.1(2)(a) in the submission of the relevant documents by a police officer to the Department is sufficient to invoke the jurisdiction of the Department in revocation proceedings. See Franklin v. Colorado Department of Revenue, 728 P.2d 391 (Colo.App.1986) (police officer's omissions in completing notice of revocation form did not invalidate revocation, as statutory requirements of former § 42-2-122.1(2) were substantially met).
Specifically, in our view the Department acquires jurisdiction in revocation proceedings under § 42-2-122.1 as long as the affidavit and other documents forwarded by the police officer contain sufficient information of a reliable character to permit the Department to make a revocation determination. See §§ 42-2-122.1(1.5)(b), (2)(a), (3)(a) & (3)(d), C.R.S. (1991 Cum.Supp.); Franklin v. Colorado Department of Revenue, supra.
We also note that the 1989 amendments to § 42-2-122.1(2) significantly relaxed the requirements of the former statute for invoking *516 the Department's jurisdiction in revocation proceedings by deleting the requirements that the police officer's report be verified and that it must contain "all" relevant information. Compare § 42-2-122.1(2)(a), C.R.S. (1991 Cum.Supp.) with Colo.Sess.Laws 1988, ch. 293, §§ 42-2-122.1(2)(a) & (2)(b) at 1360. The relaxation of these requirements in the 1989 amendments is inconsistent with the view that the General Assembly intended a police officer's noncompliance with the dating requirement now contained in the statute to be jurisdictional. See also Kenney v. Charnes, 717 P.2d 1020 (Colo.App.1986) (police officer's statutory violation in failing to serve notice of revocation personally on driver is not jurisdictional in revocation proceedings under § 42-2-122.1); Mattingly v. Charnes, 700 P.2d 927 (Colo.App.1985) (Department's statutory violation in failing to provide driver with full 20 days advance notice of hearing is not jurisdictional in revocation proceedings under § 42-2-122.1).
Here, the police officer's failure to date the notice of revocation form did not affect the reliability of the information contained in the documents submitted to the Department, and the documents contained sufficient information to permit the Department to make a revocation determination. Thus, this statutory violation is not jurisdictional, and the district court erred in ruling otherwise.
Furthermore, a revocation will not be reversed on review based on a non-jurisdictional statutory violation unless the substantial rights of the licensee are prejudiced. Mattingly v. Charnes, supra; see People in Interest of Clinton, 762 P.2d 1381 (Colo.1988) (non-jurisdictional statutory violation does not constitute reversible error unless violation is of "essential condition" of statute so as to undermine confidence in fairness of proceedings). Here, plaintiff was not prejudiced by the police officer's failure to date the notice of revocation form, and this omission was therefore harmless error.
II.
We agree with the Department's argument that the revocation for plaintiff's refusal to submit to testing is supported by the evidence in the record.
Here, the evidence at the revocation hearing was conflicting as to whether plaintiff's refusal was caused by her head injuries or by her intoxication. In evaluating the nurse's testimony on this issue, the hearing officer found that there was "no reliable evidence" which indicated to him that plaintiff's refusal "was caused by a medical condition other than intoxication."
Since the hearing officer's finding as to plaintiff's unjustified refusal was based on the resolution of conflicting evidence, this finding is binding on appeal, and the district court therefore erred in substituting its judgment for that of the hearing officer on this disputed factual issue. See Charnes v. Lobato, 743 P.2d 27 (Colo.1987).
The determination of whether a driver refused to submit to testing for purposes of the revocation statute is based solely on the objective standard of the driver's external manifestations of willingness or unwillingness to take a test. Dolan v. Rust, 195 Colo. 173, 576 P.2d 560 (1978); see Boom v. Charnes, 739 P.2d 868 (Colo. App.1987), rev'd on other grounds, 766 P.2d 665 (Colo.1988). Plaintiff's external manifestations of refusal are therefore controlling here.
Accordingly, the judgment is reversed, and the cause is remanded to the district court with directions to reinstate the order of revocation.
NEY, J., concurs.
JONES, J., dissents.
Judge JONES, dissenting.
I respectfully dissent from Part II of the majority opinion.
The majority reverses the trial court's judgment in large measure because the hearing officer found that there was "no reliable evidence" to indicate that plaintiff's refusal to submit to a blood test "was *517 caused by a medical condition other than intoxication."
In fact, the record reveals considerable evidence from an expert witness nurse who testified, without contradiction, that plaintiff's behavior was consistent with that exhibited by patients with closed head injuries and that plaintiff could not make any decisions concerning herself until about four hours after she had arrived at the hospital.
It has been held, and I agree, that, generally, any right to refuse to submit to chemical testing for purposes of the motor vehicle laws of this state must be found in statutory rather than constitutional law. Stanger v. Colorado Department of Revenue, 780 P.2d 64 (Colo.App.1989). See Brewer v. Motor Vehicle Division, 720 P.2d 564 (Colo.1986). However, that is not to say that there are no constitutional implications in the requesting and conducting of such searches.
The request to take the test provided in § 42-4-1202(3)(a)(II), C.R.S. (1991 Cum. Supp.) triggers a search and seizure under the Fourth Amendment and Colo. Const. art. II, § 7. Therefore, the request and all resultant activities must be conducted in an aura of reasonability. See Schmerber v. California, 384 U.S. 757, 86 S. Ct. 1826, 16 L. Ed. 2d 908 (1966).
The General Assembly, prior to July 1, 1989, recognized as much in requiring that tests administered must be done "with utmost respect for constitutional rights, dignity of person, and health of the person being tested." Section 42-4-1202(3)(b), C.R.S. (1984 Repl.Vol. 17). Cf. § 42-4-1202(3)(b) (1991 Cum.Supp.). Even in the present version of the statute the General Assembly continues to express concern for the "health" of the person being tested.
Upon consideration of the record here, I would determine that the trial court properly concluded that the evidence is not sufficient to support the hearing officer's findings.
I disagree with the trial court, however, that the evidence on whether plaintiff refused to take the test because of her closed head injury or because of intoxication "would weigh evenly." I conclude that the evidence preponderates in favor of plaintiff's theory that the injury caused her refusal.
Such evidence, in addition to the expert witness' testimony, includes testimony that plaintiff was in an accident, that her head and face struck the windshield, that she suffered internal injuries and injuries to her face and head, and that glass was in her hair. Additionally, uncontradicted testimony reveals that she could not recall the events after the accident, including her treatment by doctors and nurses or the conversation with the officer.
Finally, I also disagree with the trial court concerning the applicability of Higgins v. State Department of Motor Vehicles, 101 Nev. 531, 706 P.2d 506 (1985) to this case. This is, in part, because that opinion is based on a statute, Nev.Rev.Stat. § 484.383(3) (1983), which excepts from implied consent to take a test for intoxication those who are "otherwise in a condition [other than dead or unconscious] rendering [them] incapable of refusal." Colorado requires the test for all as to whom there is probable cause, even if deceased or unconscious. See § 42-4-1202(3)(c), C.R.S. (1991 Cum.Supp.).
However, the Higgins case is useful here because it recommends corroborating medical evidence in evaluating whether a person has withdrawn consent. See Department of Transportation v. Michalec, 52 Pa. Commw. 89, 415 A.2d 921 (1980).
Additionally, the Higgins court, under factual circumstances similar to those here, rejected the officer's subjective conclusions that the driver was capable of refusing to submit to the test and, instead, considered "the objective factors, namely, the circumstances of the accident, appellant's multiple serious injuries, sedated condition, and general incoherency, along with uncontradicted medical testimony," in concluding that the driver was incapable of refusing to submit to the required test. Higgins v. State Department of Motor Vehicles, supra. See State v. Morgan, 198 Mont. 391, 646 P.2d 1177 (1982); State v. Campbell, 189 Mont. *518 107, 615 P.2d 190 (1980); Rossell v. City & County of Honolulu, 59 Haw. 173, 579 P.2d 663 (1978).
I believe the hearing officer, here, in considering plaintiff's apparent refusal to take the required test, ought to have applied an objective test and rejected the officer's subjective conclusions. My view of the record is that, when the evidence is considered in light of objective factors and Fourth Amendment reasonability, the conclusion must be that plaintiff was not capable of refusing to take the test and should not be held accountable for the officer's perception that she, in fact, refused.
Accordingly, I would affirm the judgment of the trial court and remand this matter for reinstatement of plaintiff's driving privileges. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1433972/ | 956 P.2d 587 (1998)
ARAPAHOE COUNTY PUBLIC AIRPORT AUTHORITY, a political subdivision of the State of Colorado, Petitioner,
v.
CENTENNIAL EXPRESS AIRLINES, INC., a Colorado corporation; and Golden Eagle Charters, Inc., d/b/a Centennial Express Airways, Inc., a Colorado corporation, Respondents.
No. 97SC123.
Supreme Court of Colorado, En Banc.
April 13, 1998.
Rehearing Denied May 18, 1998.
*589 Brega & Winters, P.C., Ronald S. Loser, Brian A. Magoon, Peter A. Gergely, Denver, for Petitioner.
Bryant & Van Nest, LLC, Mark A. Pottinger, of Counsel, Denver, for Respondents.
Chief Justice VOLLACK delivered the Opinion of the Court.
We granted certiorari to review the court of appeals decision in Arapahoe County Public Airport Authority v. Centennial Express Airlines, Inc., 942 P.2d 1270 (Colo.App.1996), to determine whether the court of appeals erred in reversing a permanent injunction entered in favor of the plaintiff, Arapahoe County Public Airport Authority (the Authority), prohibiting the defendant, Centennial Express Airlines, Inc., and its wholly owned subsidiary, Golden Eagle Charters, Inc., d/b/a Centennial Express Airways, Inc. (Centennial Express), from conducting scheduled air carrier service in and out of Centennial Airport (Centennial). We reverse.
I.
Centennial was built in 1967 to serve the growing aviation needs of the Denver metropolitan region and has since become one of the largest and busiest general aviation facilities in the country.[1] Centennial is located fourteen miles southeast of downtown Denver and sits on approximately 1,200 acres of land in Arapahoe and Douglas Counties. In 1975, Arapahoe County established the Authority pursuant to the Public Airport Authority Law, sections 41-3-101 to -108, 17 C.R.S. (1973), to own and operate Centennial as a political subdivision of the State. The Authority owns all of the land and facilities at Centennial except for two runways which it leases from Arapahoe County.
To fund airport construction and operations, the Authority has accepted approximately $30.1 million in federal grants. As a condition to accepting these grants and pursuant to federal law, the Authority has given its assurance that it "will make its airport available as an airport for public use on fair and reasonable terms and without unjust discrimination, to all types, kinds, and classes of aeronautical uses." A separate assurance provides that the Authority "may prohibit or limit any given type, kind, or class of aeronautical use of the airport if such action is necessary for the safe operation of the airport or necessary to serve the civil aviation needs of the public."
Local, regional, and national planning schemes designate Centennial as a general aviation reliever airport for Denver's primary air carrier airports, Stapleton International (Stapleton), which closed in February of 1995 and Denver International (DIA), which opened upon Stapleton's closure. Locally, resolutions passed by the Board of County Commissioners of Arapahoe County in 1966 approved funding for the construction of a general aviation airport. Newspaper accounts of open meetings held following this funding approval indicate that county officials hoped to lure new industry and expand the county's tax base by building an airport to "serve general aviation, not scheduled carriers or military planes." A new airport would also ease general aviation overcrowding at Stapleton. In one news report, the Federal Aviation Administration (FAA) area director proclaimed that the airport was "a much needed reliever terminal for general aviation."
Regionally, the Denver Regional Council of Governments (DRCOG), a planning organization of county and municipal governments, has adopted several aviation plans that guide the development and operation of airports in the Denver area. Specifically, the 2010 Regional Aviation System Plan (2010 Plan), which was published by DRCOG in 1989, provides that Stapleton is the only commercial air carrier airport in the region and designates Centennial "as a non-commercial passenger, transport-category, general aviation reliever airport." Similarly, the Regional Aviation System Planning Program Data File, which was published by DRCOG in 1991, provides that Stapleton is the "air carrier *590 facility for the Denver region" and categorizes Centennial "as a non-commercial passenger, transport category, G.A. reliever."[2]
Nationally, the National Plan of Integrated Airport Systems (NPIAS), which was presented to Congress by the Secretary of Transportation in 1991, does not include Centennial in its summary of Colorado's primary and commercial service airports. Instead, the NPIAS lists Centennial as a reliever airport intended to alleviate general aviation congestion at Denver's primary commercial airport through 1999.
Due to its planned role as a general aviation reliever and strong opposition from citizens who live near the airport, scheduled passenger service has never been authorized at Centennial. While fixed-base air taxi and charter flights are permitted, Centennial's master plan, which was published in 1981, provides that air taxi, charter flights, and military use constitute less than one percent of the airport's total operations. Because scheduled passenger service has never been permitted, Centennial presently operates without a terminal, baggage system, or passenger security system.
Despite Centennial's lack of facilities, private efforts have been made to bring scheduled passenger service to the airport. In response, the Authority has increased efforts to prohibit scheduled passenger service. On July 21, 1993, the Authority sent a letter to the United States Department of Transportation (USDOT) asserting that the Authority did not have to approve applications for scheduled passenger service and asking USDOT for its opinion on the issue. On September 4, 1993, the Authority also amended the "Minimum Standards for Commercial Aeronautical Activities" (the Standards) governing operations at Centennial. These Standards now define "Airport Purpose" as
any Authority action, undertaking or development that is consistent in maintaining the non-certificated status of the Airport and in preserving the Airport funding category as a "Reliever Airport" serving general aviation users. Under no circumstances shall the Airport Purpose include scheduled passenger services.
(Emphasis added.)
On December 20, 1994, Centennial Express began scheduled passenger service out of Centennial to Dalhart, Texas. Centennial Express has a valid air carrier certificate issued by the FAA.[3] At the time of its maiden flight, Centennial Express was aware of the Authority's ban on scheduled passenger service but chose to delay notifying the Authority until the return flight from Dalhart. Centennial Express also issued a press release announcing that it would soon provide scheduled passenger service from Centennial to Amarillo, Colorado Springs, Grand Junction, and other Western Slope airports in 1995. Additionally, Centennial Express planned to begin regular jet flights from Colorado Springs to Chicago, Kansas City, Houston, Dallas, Phoenix, Los Angeles, San Francisco, and Seattle.
The following day, the Authority filed suit in Arapahoe County District Court (the district court) seeking a temporary restraining order and preliminary and permanent injunctions preventing Centennial Express from conducting scheduled passenger service out of Centennial. On December 22, 1994, the district court granted the Authority's request for a temporary restraining order, concluding in part that
[r]eal, immediate, and irreparable injury may be prevented if [Centennial Express is] enjoined from conducting and expanding illegal scheduled passenger service at the Airport. [Centennial Express has] made a unilateral decision to conduct illegal scheduled passenger service at the Airport. [Centennial Express has] flaunted the law by disregarding the Airport's Minimum Standards. [The Authority] manages *591 the Airport. Indeed, [the Authority's] reason to exist turns on its ability to govern and manage the Airport. If the requested relief is not provided, [the Authority] will be stripped of its ability and authority to manage the Airport.
On December 23, 1994, more than seventeen months after the Authority's initial request, USDOT responded to the Authority's letter as to whether it could ban scheduled passenger service at Centennial. In relevant part, the USDOT's letter provides as follows:
In addressing similar cases in the past, FAA has found it arbitrary to exclude any particular class of service due to factors that are not related to the impacts of that service.
Although the material that [the Authority] submitted states that approval of scheduled service would increase the number of operations and passengers at Centennial Airport, there was insufficient information submitted with [the Authority's] letter to demonstrate that a restriction of any particular category of operation could be adequately supported. For example, although individual factors are not alone likely to be dispositive, [the Authority's] letter does not discuss the nature and extent of any resulting environmental impact, congestion, or effect on airport facilities such as the terminal or parking, that would result from the initiation of scheduled service.
Later, the opinion letter states that the Authority's letter
also raises a policy issue relating to how to harmonize several important goalsallowing the citizens of a region to plan and manage their aviation resources on a regional basis, while at the same time preserving and enhancing the performance of the national aviation system and ensuring that statutory and regulatory requirements associated with use of federal grant funds are not violated.... We firmly support regional planning and decision-making and strongly believe that local governments should, wherever possible, plan, develop and operate their transportation systems in an integrated and regional context, consistent with applicable federal law....
[W]here the volume of air traffic is approaching or exceeding the maximum practical capacity of an airport, an airport owner may designate a certain airport in a multiple airport system (under the same ownership and serving the same community) for use by a particular class of aircraft so long as the owner can assure that all classes of aeronautical needs can be fully accommodated within the system of airports under the owner's control....
The issue that this raises is whether [USDOT] should change its policy to extend the flexibility now afforded to multiple airports under joint ownership to individually-owned multiple airports which are planned and operated under a regional agreement.... Because this would be a significant policy change, full consideration by the public and the aviation community is warranted. Therefore, we will be initiating, early next year, a process to obtain a full range of views on this issue.
On January 10, 1995, after conducting several hearings, the district court entered a permanent injunction prohibiting Centennial Express from conducting scheduled passenger service out of Centennial.[4] Centennial Express appealed and also filed a complaint with the Federal Aviation Administration (FAA).[5] The court of appeals reversed the district court's ruling, concluding that the Authority's regulation prohibiting scheduled passenger service was preempted by 49 U.S.C. § 41713(b)(1) (1994). The court of appeals also held that the district court should have left the question of whether the Authority could prohibit scheduled passenger service to the federal administrative agencies' primary jurisdiction.
*592 II.
At the outset, we must determine whether this court should defer to the federal agencies' holding concurrent jurisdiction over this case. The doctrine of primary jurisdiction, or the deference doctrine, calls for judicial deference in cases involving technical questions of fact uniquely within an agency's expertise and experience, or in cases where uniformity and consistency require administrative discretion. See Nader v. Allegheny Airlines, Inc., 426 U.S. 290, 303-04, 96 S. Ct. 1978, 1986-87, 48 L. Ed. 2d 643 (1976); Columbia Gas Transmission Corp. v. Allied Chem. Corp., 652 F.2d 503, 519 n. 14 (5th Cir.1981); Great Western Sugar Co. v. Northern Natural Gas Co., 661 P.2d 684, 690 (Colo.App.1982). No fixed formula exists for deciding when to invoke this doctrine, but it should be utilized reluctantly where the issue is strictly a legal one that is within the conventional competence of the courts. See Great Western Sugar, 661 P.2d at 690.
The issues in this case do not involve complex questions of fact. Rather, we have been asked to consider whether the district court properly enjoined Centennial Express from conducting scheduled passenger service out of Centennial. As defenses, Centennial Express claims that (1) the Authority's regulation prohibiting scheduled passenger service at Centennial is preempted by federal law and (2) the ban on scheduled passenger service violates the terms of the Authority's federal grant assurances. In our view, these legal and interpretive questions do not "go beyond the understanding of judges" or lay "at the heart of the task assigned the agency by Congress." See Mashpee Tribe v. New Seabury Corp., 592 F.2d 575, 580-81 (1st Cir.1979).
Additionally, the FAA has yet to rule on either of the complaints despite the fact that they were filed more than three years ago. Similarly, although the USDOT opinion letter alludes to "initiating, early [in 1995], a process to obtain a full range of views on" its policy regarding individual airport participation in regional airport planning, we have no indication from the parties or USDOT that such efforts have begun. Because there is a strong public interest in resolving this case promptly, we refuse to defer to administrative action which is of "uncertain aid and uncertain speed." See id. at 581.[6]
Centennial Express also points to the USDOT opinion letter in arguing that deference is warranted in this case. In Banner Advertising, Inc. v. People, 868 P.2d 1077, 1083 (Colo.1994), we addressed the level of deference we must afford an opinion letter issued by the FAA. Specifically, we explained:
[T]he opinion of the FAA's chief counsel... was not reached as a result of hearing adversary proceedings in which he found facts and reached conclusions of law. It is in no way binding on a court. Nevertheless, the letter was written as part of the official duties of the chief counsel, and is based on a level of more specialized expertise than most judges possess, so we may properly look to it for guidance. While opinion letters from administrative agencies are not binding authority, they can be used as persuasive authority.
Id. Contrary to Banner, where we chose to defer to the agency's letter, we believe the USDOT's opinion letter in this case does not require deference. First, the letter is brief, contains no federal preemption analysis, and fails to cite any federal cases for its propositions. Second, the letter is inconclusive because it states that the Authority submitted "insufficient information" on the impact *593 scheduled passenger service would have at Centennial. Third, because the opinion letter is only persuasive authority, it is not binding on this court. See id.
In this case, Centennial Express began scheduled passenger service in clear defiance of the Authority's regulations, before the USDOT's opinion letter was issued, and before filing its FAA complaint. Nevertheless, Centennial Express asserts that even though it has disregarded valid regulations passed pursuant to state law, we must defer to the federal agencies' concurrent jurisdiction. We disagree. If we defer to the federal agencies, we would affirm Centennial Express's course of conduct and foreclose the Authority's only avenue of relief. This would allow future airport users to unilaterally conduct and continue operations in violation of airport rules so long as they implicate federal jurisdiction in some way. Under these circumstances, we refuse to defer to the federal agencies' concurrent jurisdiction.
III.
Centennial Express argues that the ban on scheduled passenger service is preempted by federal law. We disagree.
Congress radically altered the character of commercial aviation when it amended the Federal Aviation Act and deregulated the airline industry pursuant to the Airline Deregulation Act of 1978(ADA). See Pub.L. 95-504, 92 Stat. 1705. In so doing, Congress determined that market forces were better suited for promoting efficiency, innovation, low prices, variety, and quality in the air transportation industry. See Morales v. Trans World Airlines, Inc., 504 U.S. 374, 378, 112 S. Ct. 2031, 2033, 119 L. Ed. 2d 157 (1992). However, the absence of federal regulation caused concern in Congress that individual states would pass inconsistent and conflicting laws regulating the airline industry. See H.R. Rep. 95-1211, at 15-16 (1978) reprinted in 1978 U.S.C.C.A.N. 3737, 3752; see also Margolis v. United Airlines, Inc., 811 F. Supp. 318, 320-21 (E.D.Mich.1993). Consequently, the ADA included a provision that preempted all state laws relating to the rates, routes, or services of an interstate air carrier. See 49 U.S.C. § 1305(a)(1) (Supp. III 1979). Currently, 49 U.S.C. § 41713(b)(1) (the ADA preemption provision) provides that a political subdivision of a state "may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier."[7]
Two cases from the United States Supreme Court offer guidance on the scope of the ADA preemption provision. In Morales, several airlines filed suit against the State of Texas seeking injunctive relief prohibiting enforcement of state regulations pertaining to airline fare advertising. The airlines argued that the regulations were preempted by the ADA preemption provision. Relying upon cases in which the Supreme Court interpreted a similarly worded preemption provision in the Employee Retirement Income Security Act of 1974 (ERISA), the Court determined that the ADA preemption provision expressed a broad preemptive purpose that included all "State enforcement actions having a connection with or reference to airline rates, routes, or services." Morales, 504 U.S. at 383-84, 112 S.Ct. at 2037; see also American Airlines, Inc. v. Wolens, 513 U.S. 219, 223, 115 S. Ct. 817, 821, 130 L. Ed. 2d 715 (1995). The Morales Court noted, however, that preemption was inappropriate where the state action affects airline rates, routes, and services "in too tenuous, remote, or peripheral a manner."See Morales, 504 U.S. at 390, 112 S.Ct. at 2040; Wolens, 513 U.S. at 224, 115 S.Ct. at 822.
In New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Insurance Co., 514 U.S. 645, 654-56, 115 S.Ct. *594 1671, 1676-77, 131 L. Ed. 2d 695 (1995), the Supreme Court explained that it may have interpreted the "relate to" language in prior ERISA cases too broadly.[8] Specifically, the Court explained:
If "relate to" were taken to extend to the furthest stretch of its indeterminacy, then for all practical purposes pre-emption would never run its course, for really, universally, relations stop nowhere. But that, of course, would be to read Congress's words of limitation as mere sham, and to read the presumption against pre-emption out of the law whenever Congress speaks to the matter with generality. That said, we have to recognize that our prior attempt to construe the phrase "relate to" does not give us much help drawing the line here.
Id. at 655, 115 S.Ct. at 1677 (citation and internal quotation marks omitted). Instead, the Court explained that it must address ERISA preemption cases "with the starting presumption that Congress does not intend to supplant state law." Id. at 654, 115 S.Ct. at 1676. With this presumption in mind, the Court then explained that it "simply must go beyond the unhelpful text and the frustrating difficulty of defining its key term, and look instead to the objectives of the ERISA statute as a guide to the scope of the state law that Congress understood would survive." Id. at 656, 115 S.Ct. at 1677.
Despite the broad reach the Morales Court gave the ADA preemption provision, the Travelers decision establishes a less literal method for determining whether state regulations concerning aviation are preempted. Specifically, Travelers counsels that we should first presume "that Congress does not intend to supplant state law." Id. at 654, 115 S.Ct. at 1676. Then, we must review the objectives of the statute in defining "the scope of the state law that Congress understood would survive." Id. at 656, 115 S.Ct. at 1677.
Turning to the facts of this case, we believe that the Authority's ban on scheduled passenger service is not preempted. Because the regulation concerns an area of local and regional planning, it will not lead to inconsistent or conflicting state regulations.[9] Therefore, the regulation does not undermine the purpose of the ADA preemption provision.
The Authority's regulatory ban on scheduled service also survives scrutiny under the plain meaning of the ADA preemption provision because it does not regulate the manner *595 in which airport users conduct their business. We disagree with the court of appeals that prohibiting scheduled passenger service "relates to" airline services because it does not concern typical service-oriented tasks such as ticketing, boarding procedures, providing meals and drinks to passengers, and baggage handling. See Hodges v. Delta Airlines, Inc., 44 F.3d 334, 336 (5th Cir.1995). Similarly, the Authority is not regulating airline fares or routes because the ban on scheduled service does not delineate what airlines can charge or where they can fly.
While Centennial Express has raised preemption as a defense to the Authority's ban on scheduled passenger service, we believe the Authority's actions more appropriately fall under 49 U.S.C. § 41713(b)(3) (1994) (the proprietor's exception), which provides conclusive support for the Authority's position. That section provides that the ADA preemption provision does not limit a political subdivision that owns or operates an airport "from carrying out its proprietary powers and rights."[10]
Federal courts have considered the scope of the proprietor's exception in two significant areas of airport management. The first, and most extensive, of these areas concerns an airport proprietor's ability to regulate airport noise. These cases hold that because they may be held liable for excessive noise, airport proprietors may restrict aircraft operations to accommodate permissible noise levels under the proprietor's exception. See City of Burbank v. Lockheed Air Terminal, Inc., 411 U.S. 624, 635-36 n. 14, 93 S. Ct. 1854, 1861 n. 14, 36 L. Ed. 2d 547 (1973); Santa Monica Airport Ass'n v. City of Santa Monica, 659 F.2d 100, 104 (9th Cir.1981); British Airways Bd. v. Port Auth. of New York, 558 F.2d 75, 84 (2d Cir.1977).
The second area of airport management that has been deemed to fall under the proprietor's control are perimeter rules, which restrict a commercial flight's maximum radius in order to limit an airport's ground congestion and divert long-haul traffic to other regional airports. See City of Houston v. Federal Aviation Admin., 679 F.2d 1184, 1196 (5th Cir.1982); Western Air Lines, Inc. v. Port Auth. of New York & New Jersey, 658 F. Supp. 952, 958 (S.D.N.Y.1986), aff'd, 817 F.2d 222 (2d Cir.1987). In contrast to cases affirming noise restrictions, these cases uphold perimeter rules even though they have no relationship to an airport's liability exposure. As one of these courts has reasoned,
although questions of permissible noise regulation predominate in the courts, other proprietor-imposed regulations are presently accepted as valid exercises of proprietary powers. A proprietor's interest in regulating ground congestion at its airports would appear to be at the core of the proprietor's function as airport manager, perhaps even more so than the regulation of noise; and the ability of a proprietor ... to allocate air traffic in its three airport system is important to the advancement of this interest.
Western Air Lines, 658 F.Supp. at 957 (internal quotation marks omitted).
There are no cases that address the specific question posed by the present case. Nevertheless, we believe that an airport proprietor's ban on scheduled passenger service falls squarely within the proprietor's exception. While regulations concerning aircraft noise and ground congestion restrict the manner in which airport users conduct their operations, a ban on scheduled service seeks to accomplish a more fundamental goal in setting the boundaries of permissible operations at the airport. The power to control an airport's size exists at the core of the proprietor's function and is especially strong where, as here, the prohibited use has never been allowed, or even contemplated. See id.; see also Montauk-Caribbean Airways, Inc. v. Hope, 784 F.2d 91, 97 (2d Cir.1986) (finding that, under the proprietor's exception, a municipality could prevent a seasonal operator from expanding its operations to include year-round service).
*596 By unilaterally commencing scheduled passenger service out of Centennial, Centennial Express has essentially proclaimed that the Authority, a political subdivision of the state, lacks the power to define and limit the scope of permissible operations at its airport. However, Colorado law clearly gives the Authority this power. See§ 41-3-106(1)(h), 11 C.R.S. (1997).[11] Accordingly, the Authority's ban on scheduled passenger service is a valid exercise of its proprietary powers that is not preempted by federal law.
IV.
Centennial Express also argues that the Authority has violated the terms of the federal grant assurances under which it has agreed to "make its airport available as an airport for public use on fair and reasonable terms and without unjust discrimination, to all types, kinds, and classes of aeronautical uses." See 49 U.S.C. § 47107(a) (1994) (providing that project grant application may be approved only if Secretary of Transportation receives satisfactory written assurances). We disagree.
While the grant assurances prohibit discrimination among different types, kinds, and classes of aeronautical uses, we refuse to construe them so broadly that airport proprietors must accommodate every possible aeronautical use. By the terms of the assurances, an airport proprietor who has accepted federal funding must make its airport available on "fair and reasonable terms without unjust discrimination." The anti-discrimination provision therefore prohibits airport owners from using their proprietary power to grant one operator access while denying access to, or imposing unfair terms on, a similarly situated operator.[12] Here, the Authority is not discriminating against a particular operator because the ban on scheduled passenger service applies to all airport users equally.
Furthermore, a separate assurance allows airport proprietors to prohibit specific aeronautical uses "if such action is necessary for the safe operation of the airport or necessary to service the civil aviation needs of the public." The Authority's ban on scheduled passenger service is necessary to ensure the safe operation of the airport. Although it initially plans to operate on a small scale, Centennial Express has ambitions to become much larger. Opening Centennial's doors to Centennial Express would also require the Authority to make Centennial available to other airlines who wish to provide scheduled passenger service. See 49 U.S.C. § 47107(a)(4) (1994). These new operators, some of whom may find conditions at Centennial more appealing than DIA, promise to bring increased aviation traffic to an already congested airport. This increased congestion is sure to have an impact on airport safety. Increased passenger traffic also requires additional facilities such as a terminal, security and baggage systems, which are currently lacking at Centennial. Without these facilities, the airport would become unsafe for passenger use.
Local, regional, and national aviation planning also strongly indicates that the aviation needs of the public are better served if Centennial continues to function as a general aviation reliever airport. The sudden imposition of scheduled passenger service and a *597 resulting increase in commercial operations at Centennial would disrupt this planning scheme and force general aviation operators out of this valuable reliever airport. See 49 U.S.C. § 47102(18) (1994) (defining a "reliever airport" in part as an airport designated "to provide more general aviation access to the overall community"). Currently, Centennial is congested and accommodates the majority of the region's general aviation demand while DIA continues to operate well below capacity.[13] A shift in commercial operations from DIA to Centennial would result in more of a disparity in the allocation of aircraft operations among the region's airports. See City of Houston, 679 F.2d at 1191.
The Authority's regulation prohibiting scheduled passenger service does not discriminate against individual airport users. Furthermore, the ban on scheduled passenger service "is necessary for the safe operation of the airport" and services "the civil aviation needs of the public." For these reasons, the Authority has not violated the terms of the federal grant assurances.
V.
The Authority, as the owner and operator of Centennial, has the power to enact regulations which prohibit scheduled passenger service at its airport. This regulatory ban is not preempted by federal law and does not violate the terms of grant assurances that the Authority has given to the federal government. We therefore hold that the district court properly enjoined Centennial Express from conducting scheduled passenger service out of Centennial. Accordingly, we reverse the court of appeals and remand with directions to reinstate the district court's order.
SCOTT, J., concurs and specially concurs.
BENDER, J., dissents and MARTINEZ, J., joins in the dissent.
HOBBS, J., does not participate.
Justice SCOTT concurs and specially concurs:
We granted certiorari and ordered briefing by the parties regarding two questions:
(1) Whether a political subdivision of the State, which owns and operates a general aviation reliever airport, and which has never permitted scheduled passenger service, may prohibit scheduled passenger service under state and federal law.
(2) Whether a state court may determine the proprietary powers of a political subdivision of the State, which owns and operates a general aviation reliever airport, to ban scheduled passenger service.
In answer to the first question, like the majority, I conclude that a state political subdivision, Arapahoe County Public Airport Authority (the Authority), which owns and operates a general aviation reliever airport without a terminal and passenger security system, may prohibit scheduled passenger service. My response to the second question is predicated on the answer to the first: Yes, in order to effect a prohibition on scheduled passenger service and to protect its proprietary interests, the Authority may obtain the aid of our state courts.
I write separately, however, to make clear that, in my view, because the Federal Aviation Administration (FAA) has not acted, it is inappropriate at this time to conclude that any such prohibition by the Authority is preempted. Likewise, I believe it would not be proper or prudent to withhold judicial review on this record in light of the conduct of Centennial Express Airlines, Inc. (Centennial), or under the assumption the FAA will act.
Because I fail to see how the state injunction interferes with any agency action or otherwise exercises jurisdiction in excess of what is necessary to stay the actions of Centennial, which threaten the proprietary interests of a state agency, I find no error in the district court orders. Consequently, I join the opinion of Chief Justice Vollack to reverse the judgment of the court of appeals.
*598 I.
State courts generally have concurrent jurisdiction with the federal courts to decide questions of federal law. See Martin v. Hunter's Lessee, 14 U.S. (1 Wheat.) 304, 4 L. Ed. 97 (1816). I can see no reason why a state court's exercise of concurrent jurisdiction over a particular set of questions would be displaced because a party before the court subsequently initiates additional proceedings with a federal agency that has concurrent jurisdiction over those questions. Therefore, I have no trouble concluding that the district court had the power to decide both the state and federal questions necessary to resolve this case with injunctive orders issued on the merits.
II.
The claim raised by the Authority in the district court was based principally on state law. Indeed, few can question that the Authority plainly has the power to exclude scheduled passenger service from Centennial Airport, unless, of course, Congress preempts state laws permitting such a prohibition, see maj. op. at 592-593, 594-596; dissenting op. at 602 (Bender, J.); see also Banner Advertising, Inc. v. People of the City of Boulder, 868 P.2d 1077, 1080 (Colo. 1994), which Congress has not done.
In addition, preemption may occur pursuant to a federal statute authorizing the FAA, by formal agency action, to preempt state law. However, unless the FAA acts within its defined authority, no preemption results. It is uncontroverted that the FAA has not acted.[1]
In that vacuum, on December 22, 1994, the district court first issued a temporary restraining order (temporary order). The temporary order was, by its terms, an order that "would preserve the status quo pending a trial on the merits." As the court explained, "[t]he status quo is that no scheduled passenger service is allowed at the Airport.... Granting [the] order would preserve the status quo." Thus, the court ordered Centennial "to refrain immediately from conducting and/or expanding scheduled passenger service at Centennial Airport."
Subsequently, the district court issued its Permanent Injunctive Order of January 10, 1995. However, as I read the court's order, it has self-imposed limitations worthy of note. Building upon the temporary order, the permanent injunction states that it "preserve[s] the status quo[,] no scheduled passenger service," and that it "PERMANENTLY ENJOINS [Centennial] ... to refrain immediately from conducting scheduled passenger service at Centennial Airport so long as such use is prohibited by the Minimum Standards of the Arapahoe County Public Airport Authority." (Emphasis added.)
Here, in the absence of FAA action, the Minimum Standards of the Arapahoe County Public Airport Authority continue to prohibit scheduled passenger service. I therefore agree that, under these circumstances, the district court did not err when it issued its injunction barring Centennial from conducting scheduled passenger flights based on the state law grounds urged by the Authority.
*599 Consistent with our holding today, we have previously recognized that even where a court does not have jurisdiction to decide a controversy on the merits, it may nonetheless issue an injunction to preserve the status quo pending resolution of the dispute in an appropriate forum. See Hughley v. Rocky Mtn. Health Maintenance Organization, Inc., 927 P.2d 1325, 1330 (Colo.1996) (court may enter injunction to preserve status quo despite statutory divestiture of jurisdiction over merits of dispute submitted to arbitration); Merrill Lynch, Pierce, Fenner, & Smith, Inc. v. District Court, 672 P.2d 1015, 1018-19 (Colo.1983) (same).
In my view, there can be little question as to whether the district court had jurisdiction over the state law issue and was obligated to exercise the state judicial power. Our constitution does not contemplate that a trial court can, as executive departments of government may, avoid a matter properly before it solely by exercise of its discretion. Colo. Const. Art. II, § 6. ("Courts of justice shall be open to every person, and a speedy remedy afforded for every injury to person, property or character; and right and justice should be administered without sale, denial or delay.") As the United States Supreme Court held in Cohens v. Virginia, 19 U.S. (6 Wheat.) 264, 404, 5 L. Ed. 257 (1821):
We cannot pass [a case] by because it is doubtful. With whatever doubts, with whatever difficulties, a case may be attended, we must decide it, if it be brought before us. We have no more right to decline the exercise of jurisdiction which is given, than to usurp that which is not given. The one or the other would be treason to the constitution. Questions may occur which we would gladly avoid; but we cannot avoid them. All we can do is, to exercise our best judgment, and conscientiously to perform our duty.
III.
In sum, an injunction was appropriate to protect the proprietary interests of the Authority. Therefore, I too would reverse the judgment of the court of appeals. Accordingly, I join the majority in holding that the district court's order enjoining Centennial to preserve the status quo was appropriate to resolve the dispute before that court.
Justice BENDER dissenting:
The majority holds that the Arapahoe County Airport Authority's (Authority) ban on scheduled passenger service is not preempted by 49 U.S.C. § 41713(b)(1) (1994) because the ban does not relate to rates, routes, or services. See maj. op. at 595. The majority also determines that the ban is not preempted because it falls within the proprietary powers exception to preemption set forth in 49 U.S.C. § 41713(b)(3) (1994), and that the ban is valid because it does not violate federal funding regulations. See id. at 595, 596. The majority reasons that the district court's exercise of jurisdiction in this case is appropriate because the state court system need not defer to the Federal Aviation Administration (FAA) of the Department of Transportation (DOT) regarding the applicability of the proprietary powers exception and the validity of this state regulation under federal funding requirements. See id. at 592.
I agree with the court of appeals' decision that the Authority's ban on scheduled passenger service is preempted by federal law, and that the applicability of the proprietary powers exception to the preemption statute should be determined by the FAA in keeping with the doctrine of primary jurisdiction. I would additionally hold that the state court system should defer to the FAA on the allegations of federal funding violations. Therefore, I believe the court of appeals was correct to reverse the injunction entered by the district court. While I agree with the majority that state courts and the FAA possess concurrent jurisdiction over the applicability of the proprietary powers exception and the question of whether the Authority's ban violates federal grant assurances, I would not address either issue and would defer to the FAA because both issues present important policy considerations properly resolved by a federal administrative agency. In addition, the exercise of jurisdiction by our state court system involves a high risk of inconsistent results between our state system and the federal administrative forum. Thus, I would *600 affirm the decision of the court of appeals, and I respectfully dissent from the majority opinion.
I.
Centennial Airport was founded in 1967. Construction of the airport was made possible by $30.1 million in federal grants given in exchange for the Authority's assurances that "the airport will be available for public use on reasonable conditions and without unjust discrimination," 49 U.S.C. § 47107(a)(1) (1994), and that the airport would be "open to all types, kinds, and classes of aeronautical use on fair and reasonable terms without discrimination between such types, kinds, and classes ... [unless] such action is necessary for the safe operation of the Airport or necessary to serve the civil aviation needs of the public." 14 C.F.R. § 152, app. D, ¶ 18 (1997). Use of the airport is governed by state and federal law and by regulations promulgated by the Authority. Because the Authority is a political subdivision of the state, these regulations, entitled "Minimum Standards for Commercial Aeronautical Activities" ("Minimum Standards"), have the force and effect of state law. See§ 41-3-102, 11 C.R.S. (1997) (the Authority is a political subdivision of the state); cf. § 41-3-106(1)(h), 11 C.R.S. (1997) (conferring power to regulate certain airport activities).
The airport was designed as a general aviation airport and therefore lacks the facilities associated with commercial passenger air transport, such as a terminal or baggage system. Nonetheless, the Authority historically has allowed certain types of passenger servicesunscheduled passenger servicesat the airport. Unscheduled passenger services are those in which the flight times and destinations are not offered to the public in advance. Cf. 14 C.F.R. § 119.3 (1997) ("defining scheduled passenger service").[1] Instead, unscheduled passenger services allow an individual to contact the airline and arrange for private transportation, but at a high price. Examples of unscheduled passenger services include air taxis and charter flights. Many of the companies offering unscheduled passenger services at Centennial Airport operate pursuant to a "Part 135" air carrier certificate[2] issued by the FAA. A Part 135 air carrier certificate authorizes the use of airplanes that have up to thirty seats and weigh no more than 75,000 pounds when fully loaded. See id. A Part 135 certificate allows an operator to conduct unlimited unscheduled passenger services but limits an operator to conduct no more than four scheduled round trips per week on at least one route between two or more points. See id. The Authority permits many other commercial activities, including air cargo, commercial flying clubs, flight training, and sightseeing tours.
Various parties sought the Authority's permission to initiate scheduled passenger service at Centennial Airport and were denied. On July 21, 1993, the Authority sent a letter to the DOT requesting the DOT's opinion on whether the Authority could deny applications for scheduled passenger service without violating federal law. In September of 1994, the Authority amended the Minimum Standards to prohibit scheduled passenger service.[3]
*601 Shortly thereafter, the DOT mailed a letter to the Authority in response to the Authority's inquiries. In this letter, the FAA stated that although the information provided by the Authority was not sufficient to allow the FAA to reach a conclusive determination, the exclusion of a particular class of service, such as the Authority's ban on scheduled passenger service, is generally arbitrary and invalid. The FAA then stated that the Authority's ban on scheduled passenger service raised important policy questions regarding harmonizing regional planning with national aviation requirements, and that the FAA would commence a proceeding to "obtain a full range of views on this issue."
Centennial Express operates charter services out of Centennial Airport under an agreement with the Authority in which Centennial Express agreed to use the airfield in accordance with state and federal law and in conformity with the Minimum Standards. On December 20, 1994, Centennial Express obtained a Part 135 air carrier certificate from the FAA. The air carrier certificate authorized Centennial Express to provide scheduled passenger services in the contiguous United States, Alaska, Canada, and Mexico. The certificate further authorized Centennial Express to carry up to thirty passengers for four scheduled round trips per week, per destination. The same day, Centennial Express, acting unilaterally, began its FAA-approved scheduled passenger service on its King Air aircraft,[4] with routes including service to Centennial Airport.
Upon learning that Centennial Express was conducting scheduled passenger service in violation of the Minimum Standards, the Authority filed suit against Centennial Express in district court. The Authority sought a permanent injunction prohibiting Centennial Express from providing scheduled passenger service at Centennial Airport.
Centennial Express raised several affirmative defenses. It argued that the Authority's prohibition on scheduled passenger service was not valid because the ban violated the Authority's grant agreements with the federal government by discriminating unjustly between classes of airport users. In its view the Authority's ban discriminated against scheduled passenger service because the Authority permitted unscheduled passenger services in the form of
charter service, air cargo service, corporate jet service, private aircraft of all sizes and kinds, planes noisier than Centennial Express planes, or planes identical to or larger than Centennial Express planes. [The Authority] does not seek to exclude all holders of Part 135 air carrier certificates, the certificate held by Centennial Express. [The Authority] does not seek to prohibit the frequency of any kind of flight in and out of the Airport, but merely seeks to discriminate against scheduled passenger service.
Additionally, Centennial Express argued that the ban was unenforceable because it was preempted by 49 U.S.C. § 41713(b)(1), which provides in pertinent part:
Preemption. (1) Except as provided in this subsection, a State, political subdivision of a State, or political authority of at least 2 States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of an air carrier that may provide air transportation under this subpart.
The Authority countered that the prohibition on scheduled passenger service was not preempted by 49 U.S.C. § 41713(b)(1) because subsection (3) of the same statute contains an exception that allows airport proprietors to promulgate regulations necessary to protect their rights as proprietors. Subsection (3) provides:
*602 This subsection does not limit a State, political subdivision of a State, or political authority of at least 2 States that owns or operates an airport served by an air carrier holding a certificate issued by the Secretary of Transportation from carrying out its proprietary powers and rights.
49 U.S.C. § 41713(b)(3). Centennial Express argued that the proprietary powers exception did not apply because this exception is narrow and does not permit a proprietor to enact discriminatory regulations in direct conflict with federal anti-discrimination requirements.
The district court determined that Centennial Express's operation of scheduled passenger service violated the Minimum Standards. The district court rejected the affirmative defenses raised by Centennial Express, stating that the ban did not constitute unjust discrimination under the federal grant agreements and that the ban was not preempted because it was within the scope of the Authority's proprietary powers.
Centennial Express filed a formal complaint against the Authority with the FAA, alleging that the Authority's ban on scheduled passenger service is invalid because it is discriminatory, in violation of federal funding regulations.[5] Centennial Express also appealed to the court of appeals. The court of appeals reversed, holding that the prohibition was preempted by 49 U.S.C. § 41713(b)(1) and that the applicability of the proprietor's rights exception contained in 49 U.S.C. § 41713(b)(3) was a matter that must be determined by the FAA rather than the state courts. The court of appeals did not address the issue of federal funding. The Authority then petitioned this court for certiorari review.
II. Preemption
The majority holds that the Authority's ban on scheduled passenger service is enforceable because the ban does not fall within the scope of the express preemption statute, 49 U.S.C. § 41713(b)(1). See maj. op. at 594. I disagree.
The Supremacy Clause of the United States Constitution authorizes Congress to enact legislation that preempts state law. See U.S. Const. art. VI, cl. 2. Preemption occurs in one of three ways: by express terms, by implication when Congress regulates an area in a comprehensive fashion, or by a conflict between federal and state law. See New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 654, 115 S. Ct. 1671, 1676, 131 L. Ed. 2d 695 (1995).
In 1978, Congress enacted the Airline Deregulation Act ("ADA") which largely deregulated domestic air transport. "To ensure that the States would not undo federal deregulation with regulation of their own, the ADA included a pre-emption provision, prohibiting the States from enforcing any law `relating to rates, routes, or services' of any air carrier.'" Morales v. Trans World Airlines, Inc., 504 U.S. 374, 378-79, 112 S. Ct. 2031, 2033, 119 L. Ed. 2d 157 (1992).
In Morales, the United States Supreme Court explained that the phrase "relating to" should be interpreted broadly and that "[s]tate enforcement actions having a connection with or reference to airline `rates, routes, or services'" are preempted. Id. at 384, 112 S.Ct. at 2037. For example, in Morales, the court held that state requirements on the airlines' advertisement of fares was preempted. The Court determined that the restrictions would have a significant impact on the airlines' ability to market their product, which in turn would have a significant impact on the fares the airlines charged. Thus, the restrictions "related to" rates and were preempted.
Similarly, the Authority's ban on scheduled passenger service at Centennial Airport significantly impacts the service that Centennial Express provides at the airport and the services available at Centennial Airport to the citizens of our state who wish to travel to the destinations that Centennial Express seeks to serveDalhart and Amarillo, Texas; Colorado Springs; and Grand Junction.
The policy underlying the ADA supports the view that the Authority's ban on scheduled *603 passenger service is preempted. The ban is inconsistent with the ADA's goals of furthering "the availability of a variety of adequate, economic, efficient, and low-priced services," 49 U.S.C. § 40101(4) (1994), and "encouraging entry into air transportation markets by new and existing air carriers and the continued strengthening of small air carriers to ensure a more effective and competitive airline industry." 49 U.S.C. § 40101(13) (1994).
The majority relies upon Hodges v. Delta Airlines, Inc., 44 F.3d 334, 336 (5th Cir. 1995), for the proposition that the ban does not relate to "services" because the definition of "services" provided by an airline does not include the transportation itself. See maj. op. at 594-595. I agree with the majority that Hodges is instructive in this case; however, I read Hodges to compel the opposite conclusionthat the transportation provided by an airline is a "service":
Elements of the air carrier service ... include items such as ticketing, boarding procedures, provision of food and drink, and baggage handling, in addition to the transportation itself.
Hodges, 44 F.3d at 336 (emphasis added); see also Butcher v. City of Houston, 813 F. Supp. 515, 517-18 (S.D.Tex.1993).[6] Thus, I disagree with the majority's determination that transportation is not a "service" for purposes of 49 U.S.C. § 41713(b)(1).
The majority holds that the ban affects services in "`too tenuous, remote, or peripheral a manner' to have pre-emptive effect." Morales, 504 U.S. at 390, 112 S.Ct. at 2040 (quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 100, 103 S. Ct. 2890, 2901, 77 L. Ed. 2d 490 (1983)). It is true that the phrase "relate to" has its limits. For example, in New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Insurance Co., 514 U.S. 645, 115 S. Ct. 1671, 131 L. Ed. 2d 695 (1995), the Supreme Court held the words "relate to" in the ERISA preemption provision did not displace a state regulation that required hospitals to assess a surcharge on certain patients. Id. at 661, 115 S.Ct. at 1679. The Court determined that the connection between the surcharge and ERISA benefit plans was too remote.
In my view, Travelers is not similar to the Authority's ban on scheduled passenger service at Centennial Airport because the ban on scheduled service substantially relates to the services offered by Centennial Express. This connection is significantly greater than the tenuous connection presented in Travelers. The Authority's ban is more analogous to the prohibition in Morales, which "`plainly does not present a borderline question.'" Morales, 504 U.S. at 390, 112 S.Ct. at 2040 (quoting Shaw, 463 U.S. at 100, 103 S.Ct. at 2901); see also American Airlines, Inc. v. Wolens, 513 U.S. 219, 226, 115 S. Ct. 817, 823, 130 L. Ed. 2d 715 (1995) (stating that frequent flier programs unquestionably "related to" rates for purposes of 49 U.S.C. § 41713(b)(1)).
The Supreme Court instructs us to interpret the words "relate to" in 49 U.S.C. § 41713(b)(1) broadly. See Morales, 504 U.S. at 383-84, 112 S.Ct. at 2036-37 (citing numerous cases in which the court emphasized the broad scope of the phrase "relate to"). The majority's determination that the Authority's ban does not "relate to" services is inconsistent with this mandate. For the above reasons, I would hold that the Authority's ban on scheduled passenger service "relates to" services and is explicitly preempted by 49 U.S.C. § 41713(b)(1).
III. Doctrine of Primary Jurisdiction
The majority chooses to address the scope of the proprietary powers exception and Centennial Express's assertion that the Authority's ban is unenforceable because it conflicts with the Authority's federal funding assurances. The majority chooses not to defer to the FAA on these issues, in part because of the failure of the FAA to act promptly in this *604 matter and Centennial Express's unilateral action of conducting scheduled passenger service in direct conflict with the Authority's Minimum Standards. I agree that the delay in the administrative forum and Centennial Express's violation of the Minimum Standards are regrettable and unfortunate. However, on balance, I believe this court should defer to the FAA's jurisdiction on both the proprietary powers question and the federal funding issue in keeping with the doctrine of primary jurisdiction.
The doctrine of primary jurisdiction, also known as the deference doctrine, is "a means of coordinating administrative and judicial machinery" to promote consistent decisions that reflect agency expertise. Mashpee Tribe v. New Seabury Corp., 592 F.2d 575, 580 (1st Cir.1979). The doctrine does not determine the existence of jurisdiction. Instead, it "comes into play only when both the court and the agency have jurisdiction over at least portions of the dispute." Id. at 581 n. 1. The issue "is one of harmony, efficiency, and prudence." Id.
In determining whether to defer to an agency, courts should examine three factors: "(1) whether the agency determination lay at the heart of the task assigned the agency by Congress; (2) whether agency expertise was required to unravel intricate, technical facts; and (3) whether, though perhaps not determinative, the agency determination would materially aid the court." Id. at 580-81. Another consideration may be whether the agency has an established procedure designed to resolve particular kinds of disputes. See id. at 581.
Here, Centennial Express has filed a formal complaint with the FAA alleging that the Authority's ban on scheduled passenger services is discriminatory and therefore invalid under federal funding regulations. The state court system is confronted with the same question: whether the Authority's ban is non-discriminatory. This is because both the applicability of the proprietary powers exception and Centennial Express's federal funding argument depend on the determination of that question. See Midway Airlines, Inc. v. County of Westchester, 584 F. Supp. 436, 440-41 (S.D.N.Y.1984) (airport regulations imposed pursuant to proprietary powers must be reasonable, non-arbitrary, and non-discriminatory); City of Dallas v. Southwest Airlines Co., 371 F. Supp. 1015, 1028-29 (N.D.Tex.1973) (an airport regulation that conflicts with federal non-discrimination requirements will not be upheld and is in violation of the federal funding assurances).[7] I agree with the majority that we possess concurrent jurisdiction with the FAA on whether the Authority's ban is non-discriminatory. See County of Broome v. Commuter Airlines, Inc., 83 A.D.2d 742, 442 N.Y.S.2d 652, 654-55 (1981) (stating that state courts have jurisdiction to determine the applicability of the proprietary powers exception); City of Dallas, 371 F.Supp. at 1028-29 (finding an airport proprietor in violation of federal funding requirements).
As I read the sparse precedent in this area, discrimination may occur not only within a class of aeronautical users, but also between classes of aeronautical users. See City of Dallas, 371 F.Supp. at 1031. In City of Dallas, the court held that prohibition of scheduled passenger service at an airport that permitted passenger charter flights impermissibly discriminated between classes of airport users. See id. In reaching this conclusion, the court stated:
[C]harter flights carrying passengers for hire on an unscheduled basis will continue *605 to operate out of Love Field.... [S]ome of the operations to remain at Love Field will use planes larger than Southwest's; some will use planes noisier than Southwest's; some will use planes identical to Southwest's....
....
... In place of the preference accorded mass transportation ... Plaintiffs herein, in determining who shall have access to Love Field, have preferred private aircraft, corporate jets, unscheduled cargo flights, maintenance flights, and ferry flights over Southwest's commercial service....
....
... Plaintiffs' unsystematic classification discriminates ... between uses within the same general class.... Charter flights, which may use larger or smaller aircraft than Southwest Airlines, may remain at Love Field, while Southwest Airlines must go.
Id. at 1028, 1029, 1031; see also Midway, 584 F.Supp. at 440-41 (holding application for access to airport in abeyance was a valid exercise of proprietary powers because airport board was not banning a particular user from the airport, only asking for adequate time to formulate plans to allocate scarce resources).
The majority's discussion of proprietary powers fails to address the non-discrimination requirement of the proprietary powers doctrine. In a separate discussion dealing with the issue of whether the Authority is in violation of its grant assurances of non-discrimination, the majority states that "the Authority is not discriminating against a particular operator because the ban on scheduled passenger service applies to all airport users equally." Maj. op. at 596. In other words, the majority holds that the ban is not discriminatory because the Authority has never allowed scheduled passenger service at Centennial Airport. See id. at 596 n. 12. The majority attempts to distinguish City of Dallas on the basis that the ban on scheduled passenger services in that case prohibited operations previously allowed at the airport, while the Authority has never permitted unscheduled passenger services at Centennial Airport. See id. (discussing City of Dallas).
However, the rationale of the opinion in City of Dallas did not turn on the airport's previous consent to the operations they subsequently sought to prohibit. Rather, the critical holding of City of Dallas is that discrimination occurs not only within a class, but also between classes. See City of Dallas, 371 F.Supp. at 1031. Although it is accurate to say that the Authority's ban on scheduled passenger services applies equally to all airport users, this fact does not cure the discrimination occurring in this case when the Authority permits other carriers to provide unscheduled passenger services using similar planes, similar flight patterns, making the same or more noise, and carrying the same or greater number of passengers as Centennial Express would in providing scheduled passenger service, as our record here shows. Hence, even assuming that the Authority's ban on scheduled passenger service falls within the scope of the proprietary powers exception, 49 U.S.C. § 41713(b)(3), the Authority's ban on scheduled passenger service may be unenforceable because it impermissibly discriminates between classes of airport users.
Our record reflects that there are numerous other Part 135 air carriersair carriers conducting similar flight operations using the similar aircraft and carrying the same number of passengersat Centennial Airport. Some of these carriers are operating under an air carrier certificate identical to the one that the FAA issued to Centennial Express. With respect to noise, the King Air aircraft operated by Centennial Express is quieter than a number of other aircraft currently in use at the airport, and there are at least twenty planes operating out of the airport similar to those used by Centennial Express. The only difference between these services and those offered by Centennial Express is that Centennial Express makes its rates and destinations known to the public in advance.
Complicating matters further, the Authority's ban appears to be contrary to the purpose of a public airportoperation "for the use and benefit of the public ... open to all types, kinds, and classes of aeronautical use *606 on fair and reasonable terms without discrimination between such types, kinds, and classes." 14 C.F.R. § 152, app. D, ¶ 18 (1997). Absent extraordinary circumstances, a public airport, such as Centennial Airport, should not be permitted to cater to special private interests, i.e., those individuals and corporations possessing the financial resources to either own aircraft or pay the high cost of charter flights. In addition, the Authority's ban may run afoul of the FAA's long-standing policy in favor of mass-transportation over private aircraft. See City of Dallas, 371 F.Supp. at 1029 ("Since commercial aviation represents the right of a greater number of people to use the navigable airspace of the United States, implementation of the Congressional policy requires a preference for commercial aircraft over private aircraft (and by implication over air cargo).").
Although other courts have discussed the definition of "discrimination" in the context of aeronautical operations,[8] whether this ban constitutes impermissible discrimination presents a complex and troublesome question because the FAA indicated in its informal letter to the Authority that it may change its policies to allow the proprietor of a single airport to discriminate against classes of users so long as the proprietor adheres to a regional plan which, as a whole, satisfies federal anti-discrimination requirements.
Turning to the three-part test articulated in Mashpee Tribe, I would hold that the question of whether the ban is non-discriminatory lays at the heart of the task assigned to the FAA by Congress. The determination of this question requires statutory interpretation of the ADA, particularly with respect to the proprietary powers issue because the facts present a matter of first impression regarding the scope of 49 U.S.C. § 41713(b)(3). Interpretation of the ADA is a task assigned to the FAA by Congress. See Tivolino Teller House, Inc. v. Fagan, 926 P.2d 1208, 1215 (Colo.1996) (stating that an agency is charged with the administration and enforcement of its statutory scheme, and courts must give deference to administrative interpretations of statutes); Ross v. Denver Dep't of Health & Hosps., 883 P.2d 516, 519 (Colo.App.1994) (stating that interpretation of a rule or regulation by the agency charged with its enforcement is generally entitled to great deference).
The issue of whether the Authority's ban is non-discriminatory also presents policy considerations properly left to the FAA. The FAA indicated in its informal letter that it currently permits multiple airports under joint ownership to allocate the operations of different classes of aircraft, but that such allocation is not permitted among airports under separate ownership. The FAA then stated:
[Y]our letter raises a policy issue relating to how to harmonize several important goalsallowing the citizens of a region to plan and manage their aviation resources on a regional basis, while at the same time preserving and enhancing the performance of the national aviation system and ensuring that statutory and regulatory requirements associated with use of Federal grant funds are not violated.... We firmly support regional planning and decision-making and strongly believe that local governments should, wherever possible, plan, develop and operate their transportation systems in an integrated and regional context, consistent with applicable Federal law.....
[This case presents the question of] whether the Department should initiate a change to present policy to permit two or more Federally-aided airports in an area to allocate among themselves the operations of different types of classes of aircraft, through an enforceable regional planning agreement. Because this would be a significant policy change, full consideration by the public and the aviation community is warranted. Therefore, we will be initiating, early next year, a process to obtain a full range of views on this issue. Currently, existing policy on airport access must be complied with.
(Emphasis added.) By holding that the Authority is permitted to ban certain classes of service in the name of regional planning, the majority intrudes upon the FAA's authority *607 to implement and enforce its policies as mandated by Congress.
Although the FAA's letter is not binding, we have said that courts should take particular notice of the persuasive authority provided by such guidance. See Banner Adver., Inc. v. City of Boulder, 868 P.2d 1077, 1083 (Colo.1994). The FAA's letter persuades me that this case raises important policy matters that should not be resolved by this court, but rather by that agency.
The second prong of Mashpee Tribe is whether agency expertise is required to unravel intricate, technical facts. A determination of the policy issues presented in this case requires consideration on a regional and national level of facts not developed in this record but known to the FAA. Examples of the factual issues that must be addressed are the passenger service needs of airports located in Colorado, such as Denver International Airport and Centennial Airport, and the airports located in Broomfield, Jefferson County, Greeley, and Colorado Springs, and how these services relate to the public aviation needs on a local, regional, and national level. The third prong of Mashpee Tribe is whether an agency determination would materially aid the court. In my view, the state court system would benefit greatly from the expertise of the FAA in interpreting federal law, particularly on the first impression issue of proprietary powers.
Finally, I note that the FAA's informal letter to the Authority stated that the exclusion of a particular class of service is generally arbitrary and invalid. This suggests a high probability of inconsistency between the majority's decision and the FAA's decision. "[H]armony, efficiency, and prudence" dictate deference in this case. Mashpee Tribe, 592 F.2d at 581 n. 1.[9]
IV.
I agree with the majority that local, regional, and national planning is a priority. However, I believe the Authority's ban on scheduled passenger service must be considered in the context of the public's aviation needs on the broadest possible basis by a forum designated by Congress to determine aviation policy and to decide conflicting needs among a local area, a state, and the nation. Thus, the question of whether the Authority's ban should be considered discriminatory or arbitrary is best determined by the federal agency charged with the responsibility for such policy decisions. The FAA possesses the expertise to consider the arguments advanced by the majority in light of the aviation needs of the public for the area near Centennial and to coordinate this public need with the services offered by other airports located in Colorado. Irrespective of the precipitous action by Centennial Express and the inaction of the FAA, the FAA and not the state court system is better equipped to resolve these policy matters. We should defer to the FAA regarding the scope of the proprietary powers exception and the issue concerning federal funding violations. Hence, I respectfully dissent.
*608 I am authorized to say that Justice MARTINEZ joins in this dissent.
NOTES
[1] In 1988, Centennial ranked as the twenty-eighth busiest airport in the United States. One year later, Centennial was fourth nationally in based aircraft. In 1995, Centennial was the second busiest general aviation airport in the country.
[2] In November of 1995, after the facts giving rise to this dispute arose, DRCOG published the 2020 Regional Aviation System Plan (2020 Plan) to update the 2010 Plan. The 2020 Plan refers to Centennial as a "transport-category, general aviation airport, [that] is a designated reliever to DIA."
[3] The FAA certificate authorized Centennial Express to carry up to 30 passengers for four scheduled round trips per week, per destination, in aircraft weighing less than 75,000 pounds.
[4] At a January 5, 1995, hearing, the parties stipulated that the district court would rule on the issue of permanent injunctive relief in order to expedite this case for appeal. For this reason, no preliminary injunction was issued in this case.
[5] Centennial Express's FAA complaint was the second challenging the Authority's ban on scheduled passenger service. The first complaint had been filed by an individual who is not a party to this action. Both complaints are still pending.
[6] Contrary to the court of appeals, we do not view New England Legal Foundation v. Massachusetts Port Authority, 883 F.2d 157, 171 (1st Cir. 1989), as dispositive here. In that case, the Second Circuit held that the district court erred in ruling on the merits of a case involving the imposition of landing fees at Boston's Logan Airport when the same issue was pending before the FAA. In the Second Circuit's view, the following federal actions, in addition to an FAA complaint, justified deferring to the FAA in that case:
(1) the Secretary of Transportation had ordered a formal investigation into the complaint; and (2) the United States, as amicus curiae, had urged the district court to issue an injunction preserving the status quo until the USDOT's investigation was complete. See id. In this case, we are aware of no formal investigation into the FAA complaints and have received no indication from the federal government that reviewing the merits of this case is, in its view, inappropriate.
[7] Congress reenacted Title 49 in 1994. Previously, 49 U.S.C. § 1305(a)(1) provided in relevant part that "no State ... shall enact or enforce any law, rule, regulation, standard, or other provision having the force and effect of law relating to rates, routes, or services of any carrier." Although the language of this statute differs slightly from 49 U.S.C. § 41713(b)(1), Congress intended the revision to make no substantive change. See American Airlines, Inc. v. Wolens, 513 U.S. 219, 223 n. 1, 115 S. Ct. 817, 821 n. 1, 130 L. Ed. 2d 715 (1995). Therefore, even though many of the cases cited in this opinion interpret 49 U.S.C.§ 1305(a)(1), this opinion refers to both § 1305(a)(1) and § 41713(b)(1) as the ADA preemption provision.
[8] Although Travelers does not concern aviation law, Morales explains the connection to ERISA cases as follows:
[W]e have held that a state law relates to an employee benefit plan, and is pre-empted by ERISA, if it has a connection with, or reference to, such a plan. Since the relevant language of the ADA is identical, we think it appropriate to adopt the same standard here.
Morales, 504 U.S. at 384, 112 S.Ct. at 2037 (citation and quotation marks omitted). Travelers is therefore highly instructive on the Supreme Court's current approach towards interpreting "identical" language in the ADA preemption provision. Id.
[9] Besides planning Centennial's operations on a local level, the Authority's ban on scheduled passenger service also reflects the airport's regional role as a general aviation reliever for Denver's primary commercial airport. Other federal statutes indicate a willingness to cooperate with and defer to this type of local and regional aviation planning. See 49 U.S.C. § 40101(a)(8) (1994); 49 U.S.C. § 47101(g) (1994). Specifically, 49 U.S.C. § 47101(g) provides in pertinent part that
the Secretary of Transportation shall cooperate with State and local officials in developing airport plans and programs that are based on overall transportation needs. The airport plans and programs shall be developed in coordination with other transportation planning and considering comprehensive long-range land-use plans and overall social, economic, environmental, system performance, and energy conservation objectives. The process of developing airport plans and programs shall be continuing, cooperative, and comprehensive to the degree appropriate to the complexity of the transportation problems.
Without any indication that Congress intended to disregard local and regional aviation planning altogether, preemption is unwarranted in this case. See Local 926, Int'l Union of Operating Eng'rs, AFL-CIO v. Jones, 460 U.S. 669, 676, 103 S. Ct. 1453, 1459, 75 L. Ed. 2d 368 (1983) (explaining that "in the absence of compelling congressional direction," preemption is unwarranted when" the conduct at issue is only a peripheral concern of the Act or touches on interests so deeply rooted in local feeling and responsibility that ... it could not be inferred that Congress intended to deprive the State of the power to act").
[10] For purposes of applying the proprietor's exception, a proprietor has been defined as one possessing or controlling ownership, operation, promotion, and the ability to acquire necessary approach easements. See San Diego Unified Port Dist. v. Gianturco, 651 F.2d 1306, 1317 (9th Cir.1981). Clearly, the Authority is Centennial's proprietor under this definition.
[11] Section 41-3-106(1)(h) provides in part that the Authority has the power
to provide rules and regulations governing the use of such airport and facilities and the use of other property and means of transportation within or over said airport, landing field, and navigation facilities ... and to exercise such powers as may be required or consistent with the promotion of aeronautics and the furtherance of commerce and navigation by air[.]
[12] In City of Dallas v. Southwest Airlines Co., 371 F. Supp. 1015, 1029 (N.D.Tex. 1973), the court determined that it is discriminatory for an airport proprietor to ban scheduled passenger service in order to serve general aviation exclusively. However, we view that case as offering little support for Centennial Express's position. City of Dallas involved a completely different regulatory setting because that case was decided five years before deregulation fundamentally changed the manner in which airlines, and airports, conducted their operations. Further, City of Dallas concerned a ban enacted after that airport proprietor had previously allowed scheduled passenger operations at the airport. Therefore, facilities and procedures were already in place to accommodate scheduled passenger service. Such is not the case at Centennial, where scheduled passenger service has never been permitted.
[13] DRCOG's 2020 Plan explains that in 1995, DIA was "currently operating with five of the 12 planned runways and 87 of the planned 206 gates."
[1] For purposes of this opinion, I am willing to assume that the FAA has, by statutory grant, the power to preempt the Authority's regulations. Moreover, under the grant agreements, the FAA may also be able to prevent the Authority from barring scheduled passenger service pursuant to the various assurances or contract clauses under the terms of the grant agreement. See 14 C.F.R. § 16.1.307 (establishing rules of practice for complaints involving violations of FAA regulations and grant assurances). The FAA is obligated to enforce its grant agreements and, where necessary, to compel compliance by its various grant recipients. See 14 C.F.R. § 151.7(a) (providing that FAA may authorize grant funding only where the FAA administrator is satisfied grant assurances have been or will be met). Hence, the FAA may attempt to invoke the assurances or contract clauses of the grant agreement as a bar to the Authority's actions based on a breach of contract theory. Of course, if the FAA is unable to enforce the grant agreements administratively or the Authority wishes to challenge the FAA action, the matter must be litigated in federal court because the United States would be a party. Notwithstanding the assurances under the grant agreement, in the event a grantee violates FAA regulations, the agency might also commence an enforcement proceeding under the FAA's other regulations. Nonetheless, the limiting factor in any preemption analysis here is the failure of the FAA to act and the fact no party has turned to the federal courts to compel FAA action.
[1] Although the Code of Federal Regulations does not define "unscheduled operations," a "scheduled operation" is defined as follows:
[A]ny common carriage passenger-carrying operation for compensation or hire conducted by an air carrier or commercial operator for which the certificate holder or its representative offers in advance the departure location, departure time, and arrival location.
14 C.F.R. § 119.3 (1997). Hence, an unscheduled service is a similar operation that does not offer flight information in advance. "Common carriage" is a service using aircraft with 30 or fewer seats that weighs no more than 75,000 pounds. See id. A "passenger-carrying operation" is a service that provides less than five round trips per week on at least one route between two or more points. See id.
[2] 14 C.F.R. pt. 135 (1997) is commonly known as Part 135. An operation conducted pursuant to a Part 135 air carrier certificate is restricted to certain types of aircraft as set forth in Part 119. There are numerous other Part 135 air carriers at Centennial Airport. Some of these carriers are operating under an air carrier certificate identical to the one the FAA issued to Centennial Express.
[3] The amended version of the Minimum Standards provides, in pertinent part:
An Air Carrier operator is an entity that provides scheduled passenger services and operates under the appropriate [federal aviation regulations] ... with aircraft that provide no more than 30 passenger seats and are within the weight limitations established for the Airport in its Rules and Regulations. (This category is not consistent with the Airport Purpose and will not be allowed to operate at the Airport unless required by final court order.)
(Emphasis in original.)
[4] The King Air aircraft is quieter than a number of other aircraft currently in use at the airport. There are at least twenty planes operating out of the airport similar to those used by Centennial Express.
[5] To date, the formal complaint is still pending before the FAA.
[6] The Butcher court stated:
[O]ne can imagine the effect of different states requiring a certain frequency of airline service to certain of their cities, or mandating that airline service be nonstop between certain cities.... These kinds of "services" ... are distinctively incident to the provision of airline service to the public and, just like rates and routes, are beyond the power of states to regulate or otherwise affect by local law.
Butcher, 813 F.Supp. at 517-18.
[7] I question the majority's interpretation of the scope of the proprietary powers exception. The proprietary powers exception allows a publicly owned airport to take certain actions in its capacity as a proprietor that it could not take as a regulator under its police power. See City of Burbank v. Lockheed Air Terminal Inc., 411 U.S. 624, 635 n. 14, 93 S. Ct. 1854, 1861 n. 14, 36 L. Ed. 2d 547 (1973). However, airport regulations imposed pursuant to proprietary powers must be reasonable, non-arbitrary, and non-discriminatory. See Midway, 584 F.Supp. at 440-41. The precise scope of the proprietary powers exception is unsettled. See Western Air Lines, Inc. v. Port Auth., 658 F. Supp. 952, 956 (S.D.N.Y. 1986). However, proprietary powers are extremely limited, see City of Houston v. Federal Aviation Admin., 679 F.2d 1184, 1194 (5th Cir. 1982), and "have never been deemed broad enough to authorize a municipality to adopt regulations which are in direct conflict with FAA regulations." Skydiving Ctr. of Greater Washington, D.C., Inc. v. St. Mary's County Airport Comm'n, 823 F. Supp. 1273, 1283 (D.Md.1993).
[8] See, e.g., City of Dallas, 371 F.Supp. at 1029; Western, 658 F.Supp. at 958-59.
[9] Although I would hold that we should defer to the FAA on the proprietary powers and funding issues, I possess additional reservations regarding the majority's determination that the Authority's ban is non-discriminatory.
The majority states that the Authority's ban is necessary for the safe operation of the airport because Centennial Airport lacks a terminal, security, and baggage systems. See maj. op. at 596. However, this argument might serve to reinforce the discriminatory nature of the ban. If safe passenger service requires such facilities, then charter flights and other unscheduled passenger services available to the more affluent would also be prohibited at Centennial Airport. I question whether the Authority's ban can be characterized as a safety regulation.
The majority states that the Authority's ban is necessary to service the civil aviation needs of the public because scheduled passenger services would create congestion, disrupting the services currently available at Centennial Airport by diverting scheduled passenger services to Denver International Airport. The district court found that the airport was approaching capacity but made no findings that Centennial Express's proposed scheduled passenger service "would disrupt" current services. Cf. Midway, 584 F.Supp. at 439 (extensive facts supporting the determination that the airport was congested). Under accepted federal aviation principles, it appears that a proprietor of a single airport may not circumvent the federal discrimination requirements simply because another airport in the vicinity under separate ownership is in compliance with federal anti-discrimination regulations. See Western, 658 F.Supp. at 957-58; FAA Order 5190.6A § 4-8(d) (Oct. 2, 1989). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1761777/ | 442 S.W.2d 706 (1969)
Ex parte Joseph F. SELBY.
No. 42097.
Court of Criminal Appeals of Texas.
June 25, 1969.
*707 Kermit Waters, Carson City, Nev., Sam R. Wilson, Houston, for appellant.
Carol Vance, Dist. Atty., Sam Robertson, Asst. Dist. Atty., Houston, Crawford C. Martin, Atty. Gen., Nola White, Hawthorne Phillips, W. V. Geppert, Robert C. Flowers, and Douglas Chilton, Asst. Attys. Gen., and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
DOUGLAS, Judge.
This is a habeas corpus proceeding under Article 11.07, Vernon's Ann.C.C.P., and in accordance with Ex parte Young, Tex.Cr. App., 418 S.W.2d 824. Joseph Selby, the petitioner, was convicted as an accomplice to the murder of his wife in the 147th District Court of Travis County in 1960 with the Honorable Mace Thurman, Jr., presiding.
The application for habeas corpus was filed in the convicting court. Upon the motion of both parties, the matter was transferred and a hearing was held in the 177th District Court of Harris County. Judge Thurman, after an administrative assignment, conducted the hearing on the 21st day of January, 1969, and made findings of fact and conclusions of law.
Judge Thurman found, among other things, that Selby was represented by two most able attorneys, John Cahoon and Joe Moss, both of whom had extensive experience in criminal cases; that they were to be commended for the manner in which they conducted the defense for petitioner. Mr. Cahoon testified that the right to appeal was explained to petitioner on three separate occasions by his counsel, and it was his desire not to appeal.
The first ground for relief in the application for a writ of habeas corpus complains that a confession of Clarence (Sack) Collins, who was alleged in the indictment to be a principal, was introduced against Selby. Judge Thurman found and the record shows that the confession of Clarence Collins was neither offered nor admitted into evidence.
It is contended that petitioner is entitled to release, because at the trial he was denied a prior statement of Patra Mae Bounds, a witness who testified against him.
When he elected not to appeal he waived the right to raise the issue and it cannot be presented in a collateral attack.
Petitioner contends that he was denied his constitutional right to call Maggie Morgan,[1] who had been charged as a principal to the murder, as a witness in his behalf. He relies upon Washington v. Texas, 388 U.S. 14, 87 S. Ct. 1920, 18 L. Ed. 2d 1019 (1967), which, in effect, held unconstitutional Article 711, V.A.C.C.P., and Article 82, V.A.P.C.[2] These statutes provided that persons charged as principals, accomplices and accessories could not be introduced as witnesses for one another.
When Maggie Morgan was called as a witness, an objection by the State was sustained. No attempt was made to show that Maggie Morgan would have testified, and if so, what her testimony would have been.
*708 This Court had before it a similar situation in Ex parte Thomas, 429 S.W.2d 151 (1968). Thomas did not testify or offer any affirmative defense. Selby, in the present case, did not testify nor offer an affirmative defense.
In Washington, supra, it was undisputed that Fuller, a principal, would have testified that Washington pulled at Fuller and tried to persuade him to leave and that Washington ran, and it was Fuller, and not Washington, who fired the fatal shot.
In Thomas, supra, there was an allegation that the testimony of the witness would have been relevant and material to the defense. Presiding Judge Woodley, speaking for the Court, stated: "These allegations are but conclusions. Absent are any fact allegations as to what the witness would have testified had he waived his rights and testified as a defense witness, or facts showing how appellant was prejudiced by the ruling of the trial judge at his trial."
In Ex parte Zerschausky, Tex.Cr.App., 417 S.W.2d 279, the prosecuting attorney would not waive the then statutory right to object to the testimony of witnesses charged as accessories. Zerschausky was denied relief by the majority opinion which held that in the absence of any ruling by the trial court denying the right to call witnesses under indictment as accessories there was no denial of due process. The dissenting opinion also concluded, as in Thomas, supra:
"* * * There must be a showing that the testimony of the witnesses who would have testified in their behalf is of such nature that it could have affected the outcome of the trial."
Relief was denied Zerschausky in the Federal Courts.[3]
Petitioner contends that during its deliberations the jury heard that Maggie Morgan had been convicted and had been assessed the penalty of death. He complains that he was not permitted to amend the application for habeas corpus to show this as jury misconduct. A motion for new trial based upon jury misconduct must be filed within ten days after the verdict of the jury (but for good cause shown the time for filing may be extended). Article 40.05, V.A.C.C.P.,[4] (former Article 755, V.A.C.C.P.).
The matter cannot be raised on appeal where a motion for new trial was not filed within ten days after the verdict. A fortiori, it cannot be raised years later in a collateral attack on the judgment.
Petitioner claims that the confession was involuntary. The record during the trial and at the habeas corpus hearing shows that no objection was made when the confession was offered into evidence. The record shows it was a matter of trial strategy not to object to the confession when it was offered during the trial in 1960. Both of his attorneys testified that no objection was made to the confession, because counsel thought it was to the best interest of petitioner not to object.[5]
Ex parte Bertsch, 395 S.W.2d 620, held that the Court of Criminal Appeals was *709 not required to pass upon the voluntariness of the confession when no objection to it was made and no evidence was offered as to coercion and no issue on voluntariness was created.[6] See 5 Tex.Jur.2d 67, Appeal and Error, Sec. 40.
If the matter could be considered, no error or ground for relief is shown. The facts do not support the assertion that the confession was taken involuntarily by physical abuse. Judge Thurman found that the confession was freely and voluntarily given. Selby's brother-in-law testified at the habeas corpus hearing that he had talked to Selby right after he made the confession and, "I asked him if they (the officers) had treated him ok and he said they have." Selby testified at the hearing to determine whether he was able to pay for the record, but he did not testify or offer to testify at the habeas corpus hearing for the limited purpose on the issue of voluntariness of the confession.[7]
Complaint is made that he should have had a jury trial at the habeas corpus hearing. There is no right to trial by jury in habeas corpus proceedings. Ex parte Gordon, 118 Tex. Crim. 150, 37 S.W.2d 1023. See Carroll, Right to Trial by Jury Exceptions, 7 Tex.L.Rev. 663 (1929).
Petitioner contends that since the conviction of the principal Clarence Collins was set aside, his conviction as an accomplice cannot stand. This contention is overruled. Article 80, V.A.P.C., provides that an accomplice may be tried before the principal, and the acquittal of the principal does not bar the prosecution of the accomplice.
The relief prayed for is denied.
WOODLEY, P. J., not participating.
NOTES
[1] See Morgan v. State, 171 Tex. Crim. 187, 346 S.W.2d 116 (1961).
[2] Both of these Articles were in effect at the time of the trial, and both have since been repealed; Article 711, C.C.P., in the 1965 Code of Criminal Procedure, and Article 82, P.C., in 1967.
[3] Zerschausky v. Beto, D.C., 274 F. Supp. 231; and Zerschausky v. Beto, 396 F.2d 356 (5th Cir. 1968), cert. denied 393 U.S. 1004, 89 S. Ct. 493, 21 L. Ed. 2d 468.
[4] See Rendow v. State, Tex.Cr.App., 397 S.W.2d 430, and Isaacs v. State, Tex.Cr. App., 391 S.W.2d 421.
[5] Concerning the objection, Mr. Moss testified:
"Q. (By Mr. Robertson, Assistant District Attorney) And it was a matter of trial strategy, you thinking this being the best tactic?
"A. Yes.
"* * *
"Q. Actually, really what you are getting down to, Joe, is that when I speak about `Mr. Moss, a matter of trial strategy,' you calculated in your legal mind that the very best thing for you to do was follow the procedure you followed and try to beat the State at the game, isn't that true?
"A. And did."
[6] Relief was denied by the Fifth Circuit Court of Appeals, Bertsch v. Beto, 376 F.2d 855 (1967). Certiorari was denied by the Supreme Court of the United States, 390 U.S. 909, 88 S. Ct. 832, 19 L. Ed. 2d 877 (1968).
[7] Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694, relied upon by petitioner, is not retroactive to trials beginning before June 13, 1966. (Even if a new trial were ordered, little solace could be realized from Miranda because the standards it announced do not apply to a retrial held after June 13, 1966, of a defendant initially tried before that date. Jenkins v. Delaware, 395 U.S. 213. 89 S. Ct. 1677, 23 L. Ed. 2d 253.) | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2570581/ | 269 Kan. 399 (2000)
7 P.3d 241
In the Matter of KENT A. ROTH, Respondent.
No. 83,887.
Supreme Court of Kansas.
Opinion filed June 2, 2000.
Edwin A. Van Petten, deputy disciplinary administrator, argued the cause and was on the brief for the petitioner.
Michael Gayoso, Jr., of Rork Law Office, of Topeka, argued the cause, and William K. Rork, of the same firm, was with him on the brief for respondent. Kent A. Roth, respondent, argued the cause pro se.
Per Curiam:
This is an original proceeding in discipline filed by the office of the Disciplinary Administrator against Kent A. Roth, of Ellinwood, an attorney admitted to the practice of law in Kansas.
Complaints filed against the respondent alleged that the respondent violated KRPC 1.1 (1999 Kan. Ct. R. Annot. 284) (competence) and KRPC 8.4 (d) and (g) (1999 Kan. Ct. R. Annot. 399) (misconduct).
A hearing was held before a panel of the Kansas Board for Discipline of Attorneys. The respondent appeared through counsel and the Disciplinary Administrator appeared by and through Edwin A. Van Petten, Deputy Disciplinary Administrator.
Based upon clear and convincing evidence, a unanimous panel made the followings findings of facts and conclusions of law.
"FINDING OF FACTS
"1. Kent A. Roth, is an attorney at law, Kansas Attorney Registration No. 10033. His last registration address with the Clerk of the Appellate Courts of Kansas is ... Ellinwood, Kansas....
"2. Albert Farris and Madeline Farris were married, and to this union, five (5) children were born: Melvin Farris, Mary Ann (Farris) Wilson, Alvin Farris, Joseph Farris, and William Farris. In 1978, Albert Farris and Madeline Farris divorced.
"3. In 1982, the Respondent prepared a will for Albert Farris. The will was not executed by Albert Farris until February, 1983.
"4. In 1984, Madeline Farris sought and obtained a conservatorship on behalf of her former husband.
*400 "5. Thereafter, in 1994, Albert Farris died. Following Albert Farris' death, the Respondent was retained by Alvin Farris, the executor of the estate of Albert Farris. Alvin Farris hired the Respondent to probate the estate.
"6. The estate became involved in protracted litigation regarding the conversion of estate assets by the conservator prior to Albert Farris' death. The litigation divided the Farris family.
"7. During the course of the probate matter, the Respondent prepared a promissory note in the amount of $20,000 and two mortgages in the amount of $10,000 each in favor of his law firm. Alvin Farris executed the note and mortgages and the Respondent recorded the mortgages on the property to be devised to Joseph Farris and William Farris.
"8. Prior to recording the mortgages, the Respondent did not provide notice of the encumbrance to Joseph Farris and William Farris. Additionally, the Respondent did not advise Joseph Farris and William Farris that they had the right to seek independent counsel regarding the placement of the mortgages on the properties.
"9. Joseph Farris and William Farris did not learn of the existence of the mortgages until after they hired an attorney, Michael Holland, to represent their interests in the probate matter.
"10. After William Farris learned of the existence of the encumbrances on the property to be devised to him, William Farris was tremendously upset.
"11. Joseph Farris and William incurred costs for legal services as a direct result of the two mortgages filed against the property to be devised to them.
"12. The Respondent has provided a variety of `explanations' for the note and mortgages. These `explanations' are at odds with each other. The Respondent stated that he sought the note and mortgages (1) to protect his attorney fees, (2) to compel a settlement, (3) to put the public on notice that fraudulent transfers had occurred, and (4) as a cheaper alternative to filing a Chapter 60 action. "a. Protect his attorney fees.
"(1) The Deputy Disciplinary Administrator called Thomas J. Berscheidt to testify. Mr. Berscheidt is an attorney and mediator. Mr. Berscheidt was appointed as the mediator of the Albert Farris probate case. During the attempted mediation of the probate matter, Mr. Berscheidt discussed the promissory note and mortgages with the Respondent. The Respondent told Mr. Berscheidt that the mortgages were filed to protect his potential attorneys fees in the probate case. The Respondent informed Mr. Berscheidt that his attorney fees could be as high as $20,000. Alvin Farris confirmed to Mr. Berscheidt that the reason the mortgages were filed was to protect the Respondent's potential attorney fees.
"2. Don Burns, investigator for the Office of the Disciplinary Administrator, was called to testify regarding an interview he conducted of Alvin Farris. Mr. Burns showed Alvin Farris copies of the mortgages and asked him to explain why the mortgages were drawn. Alvin Farris told Mr. Burns that he signed the mortgages on the advice of the Respondent, to secure the Respondent's attorney fees. Mr. Burns questioned Alvin Farris about alleged fraudulent transfers of land made*401 between Madeline Farris and William Farris. Alvin Farris said that he was unaware of any fraudulent transfers.
"b. Compel a settlement. During the course of the disciplinary investigation and prosecution, the Respondent stated that he did not intend to enforce the note and mortgages and he recognized that the promissory note and the mortgages were not necessary to secure his attorney fees. In a letter dated May 14, 1998, the Respondent stated:
`There was never any expectation on my part this note or Mortgages would be enforced. The hope was to obtain cooperation from Joe and William Farris. If they came to the realization continued feuding in the family would only cause the estate to shrink, perhaps a settlement would come sooner rather than [later]. In any event, it didn't work and the mortgages were released within twenty (20) days of demand pursuant to K.S.A. 58-2309a(d).'
"c. Put the public on notice that fraudulent transfers had occurred. Also, during the course of the hearing, the Respondent testified that he sought the note and recorded the mortgages because Alvin Farris, the executor, allegedly wanted `something done' to stop fraudulent transfers made by Madeline Farris to William Farris and Joseph Farris and to put the public on notice of the ongoing dispute. The Respondent also relied on this explanation at the trial court level.
"d. Cheaper alternative to filing a Chapter 60 action. Finally, the Respondent testified that Alvin Farris did not want the Respondent to file a Chapter 60 action to remedy the situation. So, the Respondent allegedly counseled Alvin Farris that the note and mortgages would serve as a cheaper alternative to filing a Chapter 60 action."
"CONCLUSIONS OF LAW
"Based upon the above findings of fact, the Hearing Panel makes the following conclusions of law:
"1. As detailed in the Formal Complaint as Amended at Hearing, the Respondent has violated Kansas Rules of Professional Conduct 1.1, 8.4(d), and 8.4(g).
"2. Rule 1.1 requires that attorneys provide competent representation to their clients. `Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation.' In this case, the Respondent breached the standard of competence required by Rule 1.1 by filing the mortgages. The Respondent has provided several explanations as to why the two mortgages were filed. Regardless of which explanation is believed, each establishes the Respondent's incompetence. Assuming that the Respondent's testimony at the hearing on the Formal Complaint is the truth, the Respondent filed these mortgages to put the public on notice of fraudulent transfers. However, this action not only did not accomplish this goal, but also placed the executor of the estate of Albert Farris in a position whereby the executor could have been found to have breached his fiduciary duty by unnecessarily encumbering the property of two of the heirs.
*402 "3. The Respondent engaged in conduct that is prejudicial to the administration of justice, in violation of Rule 8.4(d). In correspondence sent to an attorney serving as an investigator of this matter, the Respondent indicated that he obtained the promissory note and recorded the mortgages because he wanted to pressure a settlement of the litigation. Using the legal process in this fashion is prejudicial to the administration of justice.
"4. Pursuant to Rule 8.4(g), the Respondent engaged in conduct that adversely reflects on his fitness to practice law by providing false information to the Hearing Panel. When the Respondent sought Alvin Farris' signature on the promissory note and the mortgages, he did so to protect his fee. Alvin Farris understood this to be the only reason for the promissory notes and was not familiar with any fraudulent transfers of property. Additionally, the Respondent told the mediator, Mr. Berscheidt, that the reason for the note and mortgages was to protect the Respondent's fee. However, contrary to the understanding of the executor, and contrary to what the Respondent told Mr. Berscheidt during the mediation, the Respondent indicated that he secured the note and mortgages to compel the parties to settle the litigation. And now, the Respondent has testified that the reason he obtained the note and filed the mortgages was because it was cheaper to do so than file a Chapter 60 action, and to put the public on notice of fraudulent transfers of adjacent property.... The Respondent's inability to provide accurate and truthful information to the Hearing Panel adversely reflects on his ability to practice law."
Standard of Review
In disciplinary matters, this court has a duty to examine the evidence and determine for itself the judgment to be entered. The report of the disciplinary panel is advisory only and will be given the same dignity as a special verdict by a jury or the findings of a trial court, and will be adopted where amply sustained by the evidence, or where it is not against the clear weight of the evidence, or where the evidence consisted of sharply conflicting testimony. In re Carson, 268 Kan. 134, 137, 991 P.2d 896 (1999).
The respondent raises several issues regarding the panel's findings and conclusions. First, he argues that the panel erred in finding that he was in violation of KRPC 8.4(d) (engage in conduct that is prejudicial to the administration of justice) rather than the more specific KRPC 4.4 (1999 Kan. Ct. R. Annot. 381) (respect for rights of third parties) and in finding that he was in violation of KRPC 8.4(g) (engage in any other conduct that adversely reflects on the lawyer's fitness to practice law) rather than the more specific *403 KRPC 1.8 (1999 Kan. Ct. R. Annot. 325) (conflict of interest: prohibited transactions).
The panel found that the respondent had informed an investigator that he had filed the liens in order to pressure a settlement and that this use amounted to an abuse of the legal process and was prejudicial to the administration of justice.
The respondent, however, contends that the rule violated would be the more specific KRPC 4.4, which concerns respect for rights of third persons, and states: "In representing a client, a lawyer shall not use means that have no substantial purpose other than to embarrass, delay, or burden a third person, or use methods of obtaining evidence that violate the legal rights of such person." (1999 Kan. Ct. R. Annot. 381-82.)
KRPC 8.4(g) provides that it is professional misconduct for a lawyer to "engage in any other conduct that adversely reflects on the lawyer's fitness to practice law." (1999 Kan. Ct. R. Annot. 399.) The panel found that the respondent's inability to provide accurate and truthful information to the hearing panel adversely reflects on his fitness to practice law. The respondent, however, contends that the rule violated in this instance would be the more specific KRPC 1.8, regarding conflict of interest, which prohibits the lawyer from entering into a business transaction with a client. It is difficult to follow the respondent's argument. The respondent may be referring to the panel's finding that he violated 8.4(d) rather than the panel's finding that he violated 8.4(g). The panel found that the respondent violated 8.4(d) by using the notes and mortgage to pressure a settlement.
Although by no means clear, the respondent's argument appears to be that (1) he should have been charged with violating the more specific KRPC sections; (2) there is no sufficient evidence to show that he violated those more specific sections; and thus (3) he did not violate any KRPC sections. The respondent seeks to support this novel and convoluted theory by referencing the criminal case of State v. Le, 260 Kan. 845, Syl. ¶ 2, 926 P.2d 638 (1996), wherein we stated that where a conflict between general and specific statutes exists, the specific statute will prevail unless it appears that the legislature meant to make the general statute controlling.
*404 The lack of logic in this reasoning is readily apparent. The respondent's conduct in attempting to use mortgages to force a settlement may not technically have violated KRPC 4.4 in that he did not exactly use the legal process to "embarrass, delay, or burden a third person." However, his actions did constitute an abuse of the legal process which proved to be prejudicial to the administration of justice. Similarly, the violation of KRPC 8.4(g) was for the more general failure to be truthful with the panel rather than for the specific conflict of interest problems which also arose. The rules in this case do not conflict. The respondent's argument is without merit.
The respondent argues that the panel denied him due process by allowing the complaint to be amended to add an alleged violation of KRPC 1.1 (incompetence) following the presentation of the Disciplinary Administrator's case. This contention is without merit. While the Disciplinary Administrator was allowed to amend the complaint, the respondent was granted a continuance to prepare for and defend against the amended complaint. In In re Carson, we said:
"[T]he Disciplinary Administrator need not set forth in the complaint the specific disciplinary rules allegedly violated nor plead specific allegations of misconduct. Instead, the question is whether the facts set out in the complaint in connection with the charge put respondent on notice as to what ethical violations may arise therefrom. [Citation omitted.] It is not incumbent on the Disciplinary Administrator to notify respondent of charges of specific acts of misconduct as long as proper notice is given of the basic factual situation out of which the charges might result." 268 Kan. at 137-38.
We held that even where the formal complaint does not put the respondent on notice, an amendment to the complaint may be allowed so long as the respondent is not prejudiced thereby and has a reasonable opportunity to defend against the amendment. 268 Kan. at 139-40.
The formal complaint put the respondent on notice as to the basic factual situation out of which the violation of KRPC 1.1 resulted. Moreover, a continuance was provided at that point to allow the respondent to prepare against the new charge. Therefore, he was not denied due process by the amendment.
*405 The respondent also argues that he was never allowed a reasonable opportunity to defend against the violation of KRPC 8.4(g) (engage in any other conduct that adversely reflects on the lawyer's fitness to practice law) because the panel found that violation based on the respondent's conduct and conflicting stories during the investigation and the hearings. The respondent argues that this finding was unfair and that the panel should not be allowed to rely on his conduct before the hearing panel as the basis for a violation.
Due process requires that a respondent in a disciplinary action be afforded notice of the nature of the charges against him or her and a meaningful opportunity for a defense. In re Seck, 263 Kan. 482, 488, 949 P.2d 1122 (1997). The initial complaint against the respondent alleged a violation of KRPC 8.4(g) as follows:
"7. The actions of the respondent in filing the mortgages against the real estate owned by Joseph and William Farris was deceitful, as there was no legal purpose for the note or mortgages. The actions were prejudicial to the administration of justice, as such mortgages were filed simply to pressure those individuals to settling pending litigation against their own interests, and reflects adversely upon the respondent's ability to practice law in the state of Kansas, all in violation of Model Rules of Professional Conduct 8.4(c)(d) and (g)." (Emphasis added.)
Thus, the respondent was notified that his actions regarding the note and mortgages would form the basis of the alleged violation of KRPC 8.4(g). In finding a violation of 8.4(g), the panel concluded:
"4. Pursuant to Rule 8.4(g), the Respondent engaged in conduct that adversely reflects on his fitness to practice law by providing false information to the Hearing Panel. When the Respondent sought Alvin Farris' signature on the promissory note and the mortgages, he did so to protect his fee. Alvin Farris understood this to be the only reason for the promissory notes and was not familiar with any fraudulent transfers of property. Additionally, the Respondent told the mediator, Mr. Berscheidt, that the reason for the note and mortgages was to protect the Respondent's fee. However, contrary to the understanding of the executor, and contrary to what the Respondent told Mr. Berscheidt during the mediation, the Respondent indicated that he secured the note and mortgages to compel the parties to settle the litigation. And now, the Respondent has testified that the reason he obtained the note and filed the mortgages was because it was cheaper to do so than file a Chapter 60 action, and to put the public on notice of fraudulent transfers of adjacent property.... The Respondent's inability to provide accurate *406 and truthful information to the Hearing Panel adversely reflects on his ability to practice law."
The respondent contends that statements he made at the hearing regarding his reasons for filing the mortgage and notes may not be used by the panel as a basis for finding that respondent violated KRPC 8.4(g). While this court has not addressed this issue, other jurisdictions addressing this issue have concluded that false statements made before a disciplinary panel at hearing cannot be used as a basis for a disciplinary violation found by that panel, since the respondent does not have a chance to defend against such violation. See In re Tocco, 194 Ariz. 453, 984 P.2d 539 (1999); Attorney Griev. Com'n v. Goldsborough, 330 Md. 342, 361, 624 A.2d 503 (1993). Such false statements may, however, be the subject of a new and separate disciplinary proceeding. Goldsborough, 330 Md. at 361-62.
We agree with the respondent that to the extent the panel relied upon what it characterized as his false statements at the hearing as the basis for establishing a violation of KRPC 8.4(g), the panel erred. The veracity of the respondent at the hearing cannot in and of itself establish a rule violation because the respondent was not given an opportunity to defend against such an allegation. However, we also conclude that the respondent's unorthodox conduct regarding the filing of the note and mortgages, conduct which he is still unable to adequately explain, is sufficient to establish a violation of KRPC 8.4(g). Whether the purpose of the filing was to secure an unearned attorney fee, to pressure a family settlement, or a misguided attempt to put the public on notice of alleged fraudulent transfers, the respondent's actions adversely reflect on the respondent's ability to practice law, establishing a violation of KRPC 8.4(g).
The respondent next contends that the panel violated Supreme Court Rule 216 (1999 Kan. Ct. R. Annot. 243) by failing to provide him with a copy of the interview notes of investigator Don Burns until the day prior to the hearing. He argues that the failure to provide him with the testimony prejudiced his defense because he was not able to prepare to defend against the alleged inconsistent statement which Burns attributed to Alvin Farris.
*407 Supreme Court Rule 216(d) states: "Upon request, the Disciplinary Administrator shall disclose to the respondent all evidence in his possession relevant to the proceeding. No other discovery shall be permitted." However, although the respondent now argues that he was unfairly surprised by the notes of Burns, at the hearing the respondent stipulated to the admissibility of the notes. Thus, he has waived this issue.
The fourth issue raised by the respondent is that the panel erred in considering the testimony of Thomas J. Berscheidt regarding events related to him in his capacity as a mediator. The respondent contends that because the mediation involved not only the probate matter but also a discussion of the malpractice suit and complaints against the respondent, it was not proper for Berscheidt to disclose information to the disciplinary panel.
K.S.A. 60-452a, in effect at the time the mediation was conducted in 1995, provided:
"(a) If parties to a dispute agree to submit their dispute to any forum for mediation, conciliation or arbitration and all parties so agree in writing, no person who serves as mediator, conciliator or arbitrator not that person's agent may be subpoenaed or otherwise compelled to disclose any matter disclosed in the process of setting up or conducting the mediation, conciliation or arbitration."
In 1996, the statute was amended to state:
"(a) All verbal or written information transmitted between any party to a dispute and a neutral person conducting the proceeding, or the staff of an approved program under K.S.A. 5-501 et seq. and amendments thereto shall be confidential communications. No admission, representation or statement made in the proceeding shall be admissible as evidence or subject to discovery. A neutral person shall not be subject to process requiring the disclosure of any matter discussed during the proceedings unless all the parties consent to a waiver. Any party, including the neutral person or staff of an approved program conducted the proceeding, participating in the proceeding has a privilege in any action to refuse to disclose, and to prevent a witness from disclosing, any communication made in the course of the proceeding. The privilege may be claimed by the party or anyone the party authorizes to claim the privilege." L. 1996, ch. 129, § 4.
A 1999 amendment to K.S.A. 60-452a limited the privilege by providing:
"(b) The confidentiality and privilege requirements of this section shall not apply to:
*408 "(1) Information that is reasonably necessary to allow investigation of or action for ethical violations against the neutral person conducting the proceeding or for the defense of the neutral person or staff of an approved program conducting the proceeding in an action against the neutral person or staff of an approved program if the action is filed by a party to the proceeding." L. 1999, ch. 157, § 3.
The respondent argues that because the complaint against him was filed prior to the effective date of the 1999 amendment, Berscheidt's testimony as a mediator should have been excluded. Prior to the 1999 amendment, the provisions of K.S.A. 60-452a would have excluded Berscheidt's testimony as a mediator if an appropriate objection had been made. However, the respondent did not object to Berscheidt's testimony or assert such a privilege at the hearing. As a result, his argument fails.
The respondent claims that the panel erred in adopting the hearsay testimony of Burns regarding his interview with Farris. Burns testified that he spoke to Alvin Farris regarding the filing of the note and mortgages. According to Burns, Alvin Farris told him that the note and mortgages were created on the advice of the respondent to guarantee or secure the respondent's fees. Alvin Farris told Burns that he was not aware that his mother was engaging in any fraudulent transfers.
The respondent submitted two affidavits from Alvin Farris. These affidavits contradict what Burns related that Alvin Farris told him. The affidavits refute Burns' testimony that the notes and mortgage were recorded to protect respondent's attorney fee. The respondent argues that the two affidavits should be conclusive as to what actually happened and that Burns' testimony on the subject is hearsay and should not be believed. The hearsay rule is applicable in disciplinary actions. See In re Seek, 263 Kan. at 489. However, the respondent failed to raise a hearsay objection at the hearing, thereby allowing the panel to consider the testimony of Burns and decide for itself the truth based on the evidence. The respondent's contention is without merit.
The respondent's final claim is that the evidence fails to establish violations of KRPC 1.1 (competence), KRPC 8.4(d) (engage in conduct that is prejudicial to the administration of justice), and KRPC *409 8.4(g) (engage in any other conduct that adversely reflects on the lawyer's fitness to practice law).
Attorney misconduct must be established by substantial, clear, convincing, and satisfactory evidence. In re Seek, 263 Kan. at 489. Clear and convincing evidence means that the witnesses to a fact must be found to be credible; the facts to which the witness testified must be distinctly remembered; the details in connection with the transaction must be narrated exactly and in order; the testimony must be clear, direct, and weighty; and the witnesses must be lacking in confusion as to the facts in issue. In re Carson, 268 Kan. at 140.
The respondent argues that his clouding of the title of the property to be devised to Joseph and William Farris was a reasonable response to an emergency situationthat is, the alleged fraudulent transfer of property outside the estate from Madeline Farris to William Farris. He further contends that the mortgage was based on the law, in that the case of In re Estate of Chestnut, 4 Kan. App. 2d 694, 610 P.2d 1132 (1980), established the power of an executor to sell estate property. According to the respondent, his conclusion that the executor could also mortgage estate property was a logical extension of this holding.
The respondent's argument, however, fails to acknowledge that his actions, while they may have been made in response to the alleged fraudulent transfer, were legally ineffective in stopping further transfers. Also, while it may be arguable that the executor has the power to mortgage estate property if the situation demands it, the actions of the respondent were clearly unjustified and succeeded only in exposing the executor of the estate to liability for a breach of fiduciary duty. The respondent's actions demonstrate his lack of competence, thus establishing a violation KRPC 1.1.
The respondent caused a mortgage to be placed upon property devised to Joseph and William Farris as part of some ill-conceived plan to prevent Madeline Farris from engaging in fraudulent transfers of nonestate assets, a plan having no legal basis. Although the notes and mortgages stated their purpose was to secure the respondent's attorney fees, the respondent admitted that he had a concealed motive, which was either to attempt to somehow force *410 a settlement or to prevent fraudulent transfers, depending on which explanation is believed. Use of the legal system in this manner was prejudicial to the administration of justice in violation of KRPC 8.4(d), and reflected adversely on his ability to practice law in violation of KRPC 8.4(g).
We conclude that the findings and conclusions of the panel, except those noted above in this opinion, are supported by clear and convincing evidence.
The panel recommended to this court that the respondent should receive published censure for his violations. In making this recommendation the panel noted:
"[T]he factors outlined by the American Bar Association in its Standards for Imposing Lawyer Sanctions (hereinafter `Standards'). Pursuant to Rule 3 of the Standards, the factors to be considered are the duty violated, the lawyer's mental state, the potential or actual injury caused by the lawyer's misconduct, and the existence of aggravating or mitigating factors.
"Duty Violated
"In this case, the Respondent owed a duty of competent representation to his client, the estate of Albert Farris. Additionally, the Respondent owed the legal system the duty to refrain from engaging in conduct that involves dishonesty or misrepresentation.
"Mental State
"The Respondent engaged in intentional conduct: the Respondent intentionally recorded frivolous mortgages on the property of William Farris and Joseph Farris and the Respondent intentionally provided false information to the Hearing Panel.
"Injury
"The Respondent's misconduct of obtaining the promissory note and recording the mortgages in favor of his law firm resulted in actual and potential injury. Joseph Farris and William Farris incurred costs of legal services to protect their property interests. Additionally, Joseph Farris and William Farris suffered the potential injury of losing their property to the fraudulent mortgages.
"By providing false or inconsistent information during these proceedings, the Respondent, again, has caused actual harm. The harm in this regard is the degradation of the integrity of the disciplinary process.
"Aggravating or Mitigating Factors
"Aggravating circumstances are any considerations or factors that may justify an increase in the degree of discipline to be imposed.
*411 "Prior Disciplinary Offense. The Respondent was previously disciplined by public censure in 1991. See In re Roth, 248 Kan. 194, 803 P.2d 1028 (1991). It is important to note that the misconduct in the previous discipline involved a misrepresentation and a false statement.
"Dishonest Motive. Respondent was less than candid in explaining his conduct in this matter. Additionally, recording mortgages in favor of his law firm for $20,000, when he had not earned such an amount is disingenuous.
"Pattern of Misconduct. Because the Respondent has a previous record of discipline, the Respondent has engaged in a pattern of misconduct.
"Multiple Offenses. Likewise, because the Respondent has a previous record of discipline, he has engaged in multiple offenses.
"Bad Faith Obstruction of the Disciplinary Proceeding. The Respondent's failure to provide an honest explanation for his conduct has resulted in the obstruction of the disciplinary proceeding.
"Deceptive Practices During the Disciplinary Process. Throughout the mediation of the probate action and this disciplinary investigation and prosecution, the Respondent has provided varying explanations for obtaining the note and mortgages from the executor of Albert Farris' estate. At the hearing, Mr. Berscheidt testified that the Respondent explained that the note and mortgages were simply to protect his fee. Information from Alvin Farris verified this version. However,... pleadings filed in the probate matter by the Respondent and the Respondent's testimony at the hearing included a variety of other reasons for the note and mortgages. As a result, the Hearing Panel finds that the Respondent was deceptive during the proceedings in providing these various explanations for his conduct.
"Refusal to Acknowledge Wrongful Nature of Conduct. At no time during the course of the hearing that spanned two days did the Respondent admit that what he did was wrong and in violation of the Kansas Rules of Professional Conduct. In fact, the Respondent maintains that the Disciplinary Administrator's office is acting in an arbitrary and capricious manner and that this disciplinary action should never have been brought against him.
"Vulnerability of the Victims. Alvin Farris, Joseph Farris, and William Farris were vulnerable victims. The Respondent counseled Alvin Farris that he should execute the promissory note and mortgages in favor of his law firm. Following that advice caused the executor to breach the fiduciary duties he owed to the heirs of Albert Farris. Additionally, Joseph Farris and William Farris were vulnerable in that neither party was aware of the cloud placed on their property until they retained an attorney who discovered the recorded mortgages.
"Substantial Experience in the Practice of Law. According to the Respondent's testimony, he was admitted to the bar in the State of Kansas in 1979. During the past 20 years, the Respondent has developed a general practice and has some experience with probate and real estate law.
"Mitigating circumstances are any considerations or factors that may justify a reduction in the degree of discipline to be imposed. The Respondent present[ed] *412 to the Hearing Panel, in the form of Exhibit 19 which was admitted, under seal, without objection, some medical records. The Hearing Panel has read and reviewed the medical records.
"The hearing panel finds that the Respondent's prior disciplinary violation was remote. In 1991, the Respondent was publicly censured. That factor was considered by the Hearing Panel in reaching its recommendation.
"In reaching its recommendation for discipline, and in addition to considering Rule 3 of the Standards, the Hearing Panel has also considered Rule 4.53, which addresses competency, and Rules 7.2 and 7.3, which concern violations of duties owed to the legal profession. In the comments to Rule 4.53, it is noted that most courts impose reprimands on lawyers who are incompetent. Additionally, the comments to Rule 7.2 include a statement that reprimand is the appropriate sanction in most cases of a violation of a duty owed to the legal profession.
"While the Hearing Panel is mindful of the suggestions made in the comments to the Standards, the Hearing Panel is troubled by the Respondent's conduct in the context of this complaint. He has not shown remorse at any point in the proceedings. The Hearing Panel is further troubled by the Respondent's inconsistent explanations of his actions in this case. Under oath, he testified that the purpose of filing these mortgages was to prevent a fraudulent transfer in the estate. In rebuttal testimony, a witness noted that the Respondent stated to him that the purpose of filing the mortgages was to protect his fee, which he thought might be as high as $20,000. The Respondent did not attempt to rebut this testimony. The Respondent also testified that he knew that filing the mortgage was unnecessary. Thus, the filing had no basis other than to possibly protect the Respondent's fees. His client was the estate. Despite the fact that his client was the estate, and not Alvin Farris, individually or in his capacity as the executor, the Respondent let Alvin Farris' position in the family dispute influence his actions.
"The panel did not find any intent to harm on the part of Respondent in his actions. Had the Panel so found it would have recommended suspension. With particular reference to Standard 7.3 of the ABA Standards for Imposing Lawyer Sanctions, it is the recommendation of the Panel that the Respondent b[e] publicly censured."
The court, having considered the record, the report of the panel, the matters in aggravation and mitigation, and the recommendation of the panel, accepts and concurs in the findings, conclusions, and recommendations of the hearing panel with the exception of those matters noted in this opinion. Based upon the record and respondent's violations of KRPC 1.1 and KRPC 8.4 (d) and (g), we determine that respondent's violations warrant published censure.
IT IS THEREFORE ORDERED that Kent A. Roth be disciplined by published censure in accordance with Supreme Court Rule 203(a)(3) (1999 Kan. Ct. R. Annot. 210).
*413 IT IS FURTHER ORDERED that this order be published in the official Kansas Reports and that the costs herein be assessed to the respondent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2237091/ | 414 Ill. 386 (1953)
111 N.E.2d 322
THE DEPARTMENT OF PUBLIC WORKS AND BUILDINGS, Appellee,
v.
FLORENCE W. WOLF et al. (WILLIAM F. DIXON et al., Appellants.)
No. 32615.
Supreme Court of Illinois.
Opinion filed March 23, 1953.
WALTER W. WINGET, and ROBERT E. HUNT, both of Peoria, for appellants.
IVAN A. ELLIOTT, Attorney General, of Springfield, (WILLIAM C. WINES, RAYMOND S. SARNOW, and A. ZOLA GROVES, of counsel,) for appellee.
Reversed and remanded.
Mr. JUSTICE HERSHEY delivered the opinion of the court:
This was a proceeding in the circuit court of Peoria County to condemn the rights of access, ingress and egress to and over an existing right of way for the construction of a freeway, and to determine the damages accruing to *387 the owners of adjacent properties pursuant to section 3 of the Freeways Act. (Ill. Rev. Stat. 1951, chap. 121, par. 336.) This right of way had been acquired by the State of Illinois, by purchase several years prior to the filing of this petition to condemn, for a highway to be known as Federal Aid Route 172 with no abridgement of the benefits of the ordinary rights of access, ingress, and egress to and over said right of way or the highway when completed. The appellants, owners of certain adjacent parcels of property whose rights of access, ingress and egress were condemned, appeal from the judgment of the circuit court rendered on a verdict of no dollars as damages.
On October 5, 1951, the Department of Public Works and Buildings of the State of Illinois, appellee here, filed a petition to extinguish or limit by condemnation the rights of access, ingress, egress and crossing by vehicular traffic of abutting property owners onto a right of way previously purchased by the State and known as Federal Aid Route 172. The suit was filed against several property owners, but many of them then settled with the State. The case was pursued, over objections of counsel, as to the following property owners and appellants here: Dr. William F. Dixon and his wife, Caroline Dixon, Richard A. Jockisch and his wife, Norma L. Jockisch, and Luella C. Jockisch, a widow.
Richard and Norma Jockisch own, as joint tenants, a tract of land in the city of Peoria described in the petition as tract 17-A. A strip of land 120 feet in width along the northerly side of this property had previously been dedicated to the State of Illinois for a highway designated as Federal Aid Route 172. When the Jockischs acquired title in May of 1949 the south side of Route 172 was recited as the north boundary of their property.
Luella Jockisch, mother of Richard Jockisch, owns the tract of land adjoining her son's property on the east and known as tract 16-A. The deed to Luella Jockisch likewise *388 refers to Route 172 as the north boundary of her property, 120 feet off the northerly end previously having been dedicated to the State therefor.
Dr. William Dixon, in the 1930's, purchased and still owns two adjacent tracts of land, each about 155 feet in width and extending in an east-west direction between Sheridan Road and North Street in the city of Peoria, a distance of a quarter mile. These lots are known as lots 16 and 17 in Benton Corrington Place. On January 9, 1949, Dr. Dixon and his wife sold to the State of Illinois a strip of land 120 feet wide off of the north side of lot 17. Lot 16 lies immediately to the south of lot 17.
A hearing was had, during the course of which the jury viewed the premises. A verdict of no dollars damages to the land not taken was returned. Motion for new trial was overruled and judgment entered on the verdict.
The record discloses that two witnesses, real-estate brokers, called by the State of Illinois as appraisers, testified they had examined these properties and had found "Freeway" signs erected on the right of way along the north edge of each piece of property examined. They also testified that they had been advised that the State had declared this right of way to be a freeway in August of 1949, and that in their appraisal they assumed on October 5, 1951, the date of filing this petition to condemn, that the right of way of Route 172 was a freeway and, based on this assumption and comparing the value of appellants' properties on the date of the filing of the petition with the probable value of same on completion of the highway, they concluded there could be no change in the value of the appellants' properties.
The assistant Attorney General inquired of an appraiser, who testified in behalf of the appellants, whether he was aware that freeway signs were posted at the time this petition was filed, and that the freeway had been declared over two years prior to October 5, 1951.
*389 From the verdict returned, it is evident that the jury believed the testimony presented by the State, and based their determination upon the basis that the right of way purchased for Route 172 had been a freeway from the date of the erection of the freeway signs, as urged by the State's appraisers. Having heard testimony relating to this freeway declaration and the posting of these signs, the jury was taken to view the premises where it too observed the freeway signs. This court has determined that the taking or damaging of land by eminent domain is not accomplished by passing ordinances or resolutions, or by serving notice upon the owner that the land may be required for public purposes. (Eckhoff v. Forest Preserve Dist. 377 Ill. 208.) Hence this declaration of freeway in August, 1949, and the erection of freeway signs adjacent to these properties could not have the effect of extinguishing or limiting the access rights of appellants' property or of damaging said property. Such a result ensued only from the actual condemnation. The appellee's appraisers were incorrect in considering the effect of such facts and were thus incorrect in their assumptions and as a consequence in their conclusions.
The rights of access, ingress and egress condemned by this petition are valuable property rights and cannot be taken away or materially impaired without just compensation. (Lydy, Inc. v. City of Chicago, 356 Ill. 230; Illinois Malleable Iron Co. v. Comrs. of Lincoln Park, 263 Ill. 446.) This rule applies not only in Illinois but is generally recognized to be the law throughout the United States. (39 C.J.S. 1081, Highways, sec. 141.) Moreover, the Freeways Act, in the section under which this proceeding is brought, (Ill. Rev. Stat. 1951, chap. 121, par. 336,) specifically recognizes an abutting property owner's rights of access, ingress or egress as property rights which may be extinguished only by purchase or condemnation. It thus recognizes the rights as being of value, and that the taking thereof must be compensated.
*390 We do not hold, of course, that there may never be circumstances which would justify a jury in finding that particular easements are without value. But such a verdict must be based upon admissible evidence and proper instructions.
Upon argument before this court, the State of Illinois abandoned the position it had taken in the lower court and in its briefs presented here, and recognized the right of access as a compensable property right, the taking of which might inflict some damage upon these abutting properties.
In the light of existing principles of law, and the errors apparent in the record, the judgment of the circuit court of Peoria County is necessarily reversed and the cause remanded for a new trial to determine the damages.
Reversed and remanded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2313393/ | 73 F. Supp. 2d 804 (1999)
NORTH AMERICAN NATURAL RESOURCES, INC., et al., Plaintiffs,
v.
MICHIGAN PUBLIC SERVICE COMM'N, et al., Defendants.
Midland Cogeneration Venture Limited Partnership, Plaintiffs,
v.
Michigan Public Service Comm'n, et al., Defendants.
Michigan Power Limited Partnership and ADA Cogeneration Limited Partnership, Plaintiff,
v.
Michigan Public Service Comm'n, et al., Defendants.
Central Wayne Energy Recovery Limited Partnership, Plaintiff,
v.
Michigan Public Service Comm'n, et al. Defendants.
Nos. 5:98-CV-21, 5:98-CV-22, 5:98-CV-23 and 5:98-CV-24.
United States District Court, W.D. Michigan, Southern Division.
July 7, 1999.
Thomas J. Waters, Fraser, Trebilcock, Davis & Foster, PC, Lansing, MI, for North American Nat. Resources, Inc., Com. Power Co., Hubbardson Power Co., Cadillac Renewable Energy, LLC, Granger Elec. Co., Adrian Energy Assoc., LLC, Mich. Cogeneration Systems, Inc., Sumpter Energy Assoc., Ltd. Partnership, Riverview Energy Systems Partnership, Inc., Viking Energy of Lincoln, Inc., Viking Energy of McBain, Inc., Grayling Generating Station Ltd. Partnership, Hillman Power *805 Co, LLC, Genesee Power Station, LP, Ypsilanti, Charter Tp. of, Central Wayne Energy Recovery Ltd., Partnership, Plaintiffs.
Stephen O. Schultz, Foster, Swift, Collins & Smith, PC, Lansing, for Midland Cogeneration Venture Limited Partnership, Plaintiff.
David A. Voges, Asst. Atty. Gen., Jennifer M. Granholm, Attorney General, Patricia S. Barone, Assistant Atty. Gen., Assistant Attorney General, Lansing, MI, for Michigan Public Service Commission, John G. Strand, John C. Shea, David A. Svanda, Defendants.
David E.S. Marvin, Fraser, Trebilcock, Davis & Foster, PC, Lansing, MI, for Michigan Power Limited Partnership, ADA Cogeneration Limited Partnership, Plaintiffs.
OPINION
QUIST, District Judge.
Background
The Plaintiffs in these consolidated cases own and operate electric cogeneration facilities which are "qualifying facilities" under the Public Utility Regulatory Policies Act of 1978 ("PURPA"), 16 U.S.C. §§ 824-824k.[1] Plaintiffs sued Defendants, Michigan Public Service Commissioners John G. Strand, John C. Shea, and David A. Svanda, alleging that certain orders (the "Restructuring Orders") issued by the Michigan Public Service Commission ("MPSC") are in conflict with and violate PURPA and seeking declaratory and injunctive relief.[2]
Defendants previously moved to dismiss the case on the grounds that: (i) Plaintiffs' claims were barred by the Eleventh Amendment; (ii) there was no case or controversy because Plaintiffs could not demonstrate actual harm; (iii) the Court should abstain under one or more abstention doctrines; and (iv) the claims under 42 U.S.C. § 1983 failed to state a claim. In an Opinion and Order dated November 24, 1998, the Court granted and denied the motion in part. In particular, the Court determined that Plaintiffs' claims against the MPSC were barred by the Eleventh Amendment but that Plaintiffs could maintain their claims against the individual Defendants for injunctive and declaratory relief under the doctrine of Ex Parte Young, 209 U.S. 123, 28 S. Ct. 441, 52 L. Ed. 714 (1908). See North Am. Natural Resources, Inc. v. Michigan Pub. Serv. Comm'n, 41 F. Supp. 2d 736, 745 (W.D.Mich.1998). In addition, the Court found that Plaintiffs' claims for declaratory relief presented an actual controversy for adjudication because Plaintiffs demonstrated a real harm and had presented evidence that other parties interpreted the Restructuring Orders in the same manner as Plaintiffs. See id. at 742-43 and 742 n. 5. Finally, the Court rejected Defendants' abstention arguments and their argument regarding the § 1983 claims. See id. at 743-45.
Presently before the Court are Plaintiffs' motions for summary judgment. The instant motions address the only issues remaining for decision, namely, whether the Restructuring Orders violate Plaintiffs' rights under PURPA, and whether certain Plaintiffs are entitled to attorneys fees under 42 U.S.C. § 1988.
Overview of PURPA
Under the Federal Power Act ("FPA"), 16 U.S.C. § 791a825u, any person who *806 owns or operates facilities used to transmit or sell electric energy in interstate commerce at wholesale is subject to the jurisdiction and regulatory power of the Federal Energy Regulatory Commission ("FERC"). See 16 U.S.C. § 824; New England Power Co. v. New Hampshire, 455 U.S. 331, 340, 102 S. Ct. 1096, 1101, 71 L. Ed. 2d 188 (1982). In 1978, Congress modified the FPA by enacting PURPA as part of a comprehensive package of energy legislation in response to the nationwide energy crisis. See FERC v. Mississippi, 456 U.S. 742, 745, 102 S. Ct. 2126, 2130, 72 L. Ed. 2d 532 (1982); Fulton Cogeneration Assocs. v. Niagara Mohawk Power Corp., 84 F.3d 91, 94 (2d Cir.1996). Among other things, "PURPA is intended to control power generation costs and ensure long-term economic growth by reducing the nation's reliance on oil and gas and increasing the use of more abundant, domestically produced fuels." Freehold Cogeneration Assocs., L.P. v. Board of Regulatory Comm'rs of New Jersey, 44 F.3d 1178, 1182 (3d Cir.1995). Section 210 of PURPA reflects Congress' policy of requiring utility companies to sell electric energy to, and buy electric energy from, nontraditional electric producing facilities.
Congress believed that increased use of these sources of energy would reduce the demand for traditional fossil fuels. But it also felt that two problems impeded the development of nontraditional generating facilities: (1) traditional electricity utilities were reluctant to purchase power from, and to sell power to, the nontraditional facilities, and (2) the regulation of these alternative energy sources by state and federal utility authorities imposed financial burdens upon the nontraditional facilities and thus discouraged their development.
In order to overcome the first of these perceived problems, § 210(a) directs FERC, in consultation with state regulatory authorities, to promulgate "such rules as it determines necessary to encourage cogeneration and small power production," including rules requiring utilities to offer to sell electricity to, and purchase electricity from, qualifying cogeneration and small power production facilities....
To solve the second problem perceived by Congress, § 210(e), 16 U.S.C. § 824a-3(e), directs FERC to prescribe rules exempting the favored cogeneration and small power facilities from certain state and federal laws governing electricity utilities.
FERC v. Mississippi, 456 U.S. at 750-51, 102 S. Ct. at 2132-33.
Pursuant to § 210(b) and the regulations implemented by FERC, utilities must purchase electricity from qualifying facilities ("QF") at rates which are "just and reasonable to the electric utility and in the public interest" and which do "not discriminate against" QFs. 16 U.S.C. § 824a-3(b); 18 C.F.R. § 292.304(a)(1)(i), (ii). The FERC regulations require a utility to purchase electricity from a QF at the utility's "avoided cost," which is defined as "the incremental costs to an electric utility of electric energy or capacity or both which, but for the purchase from the qualifying facility or qualifying facilities, such utility would generate itself or purchase from another source." 18 C.F.R. §§ 292.101(b)(6), 292.304(a)(2). In addition, the FERC's rules exempt QFs from certain state laws and regulations, including state laws governing the rates of electric utilities. See 18 C.F.R. § 292.602.
The FERC regulations permit a QF to either provide energy as the QF determines energy to be available for purchases, or to enter into an enforceable contract for the delivery of energy over a specified term. See 18 C.F.R. § 292.304(d). If a QF chooses the latter option, the QF may elect to set the rates based upon the utility's avoided costs either at the time of delivery or at the time the QF incurs its obligation to deliver energy, i.e., up-front. See id. § 292.304(d)(2); Independent Energy Producers v. California Pub. Utils. Comm'n, 36 F.3d 848, 851-52 (9th Cir.1994). Where a QF elects to set the contract rate up front, it is entitled to receive that rate, *807 even if the utility's future avoided costs turn out to be lower than estimated at the time the purchase contract is signed. See id. at 858 (stating that "the fact that the prices for fuel, and therefore the Utilities' avoided costs, are lower than estimated, does not give the state and the Utilities the right unilaterally to modify the terms of the standard offer contract. Federal regulations provide that QFs are entitled to deliver energy to utilities at an avoided cost rate calculated at the time the contract is signed").
State regulatory authorities such as the MPSC are required to implement PURPA pursuant to the rules and regulations promulgated by FERC. See 16 U.S.C. § 824a-3(f). A state has broad authority to implement PURPA with respect to the approval of purchase contracts between utilities and QFs. See Crossroads Cogeneration Corp. v. Orange & Rockland Utils., Inc., 159 F.3d 129, 135 (3d Cir.1998) ("Though PURPA does limit the authority of state agencies in some respects, e.g., by exempting cogeneration facilities from some regulation, PURPA still provides a substantial role to state agencies in regulating energy contracts between utilities and cogenerators"); Independent Energy Producers, 36 F.3d at 856 (noting that "[t]he state's authority to implement section 210 is admittedly broad").
While states do play a substantial role in implementing PURPA and approving contracts between utilities and QFs, once a state regulatory commission establishes the "avoided cost" to be paid, the state no longer has authority to regulate the QF's rate. See Freehold, 44 F.3d at 1191-92; cf. Independent Energy Producers, 36 F.3d at 858. Thus, once a state approves an avoided cost rate in a QF's contract with a utility, the state "cannot later review the contract to reconsider avoided costs." Smith Cogeneration Management v. Corporation Comm'n, 863 P.2d 1227, 1240 (Okla.1993).
Facts
Each Plaintiff in this case has entered into a long-term Power Purchase Agreement ("PPA") with either Consumers Power Company or Detroit Edison to supply electric power at "avoided cost" rates as required by PURPA. Plaintiffs elected to have the utilities' avoided costs determined as of the time they entered into the PPAs. The MPSC approved the avoided costs rates in Plaintiffs' PPAs.[3]
On December 19, 1996, the MPSC Staff filed a report which outlined a conceptual framework for restructuring the electric utility industry in Michigan. The basic plan of the restructuring was to gradually permit all electric utility customers to choose their own suppliers of power, although the electric utilities would continue to distribute or transmit the power to consumers. Following a series of hearings, the MPSC issued orders dated June 5, 1997, and October 29, 1997 (the "Restructuring Orders"), which provided for the restructuring in the service territories of Consumers and Detroit Edison. Among other things, the Restructuring Orders provided that certain QF avoided costs would be classified as "stranded costs"[4]*808 for purposes of recovery by utilities through retail rates and that the last day for utilities to collect "stranded costs" would be December 31, 2007.
Various parties that were dissatisfied with the October 29, 1997, order filed petitions for rehearing. In its Rehearing on Restructuring Order, issued January 14, 1998, the MPSC confirmed that the last day for collecting stranded costs was December 31, 2007. Interpreting the Restructuring Orders as preventing Consumers and Detroit Edison from recovering their avoided costs from their customers after the year 2007, certain Plaintiffs in this case filed petitions to intervene before the MPSC seeking clarification that the orders did not impact Plaintiffs' rights under their PPAs by precluding the utilities from collecting their "stranded costs" beyond the year 2007. On February 11, 1998, the MPSC issued an order in response to the petitions to intervene and motions for clarification, in which the MPSC stated that its orders had not modified the rates in Plaintiffs' PPAs. However, the orders did not clarify whether the restructuring orders interfere with Consumers' or Detroit Edison's rights to recover the avoided cost rates in the PPAs after the year 2007. Plaintiffs appealed the orders under state law to the Michigan Court of Appeals.
Plaintiffs filed these actions seeking declarations that the MPSC's restructuring orders violate their rights under PURPA. Plaintiffs allege that if the orders can be interpreted as disallowing recovery of the QFs' avoided cost rates after the year 2007, the "regulatory out" clauses[5] in their PPAs will permit Consumers and Detroit Edison to reduce their payments to Plaintiffs which, in turn, will cause Plaintiffs substantial financial losses.
Summary Judgment Standard
Summary judgment is appropriate if there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. Fed. R.Civ.P. 56. The rule requires that the disputed facts be material. Material facts are facts which are defined by substantive law and are necessary to apply the law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986). A dispute over trivial facts which are not necessary in order to apply the substantive law does not prevent the granting of a motion for summary judgment. Id. at 248, 106 S. Ct. at 2510. The rule also requires the dispute to be genuine. A dispute is genuine if a reasonable jury could return judgment for the nonmoving party. Id. This standard requires the non-moving party to present more than a scintilla of evidence to defeat the motion. Id. at 251, 106 S. Ct. at 2511 (citing Improvement Co. v. Munson, 14 Wall. 442, 448, 20 L. Ed. 867 (1872)).
A moving party who does not have the burden of proof at trial may properly support a motion for summary judgment by showing the court that there is no evidence to support the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 324-25, 106 S. Ct. 2548, 2553-54, 91 L. Ed. 2d 265 (1986). If the motion is so supported, the party opposing the motion must then demonstrate with "concrete evidence" that there is a genuine issue of material fact for trial. Id.; Frank v. D'Ambrosi, 4 F.3d 1378, 1384 (6th Cir.1993). The court must draw all inferences in a light most favorable to the non-moving party, but may grant summary judgment when "the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party." Agristor Financial Corp. v. Van Sickle, 967 F.2d 233, 236 (6th Cir. 1992) (quoting Matsushita Elec. Indus. *809 Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S. Ct. 1348, 1356, 89 L. Ed. 2d 538 (1986)).
Discussion
I. Declaratory Judgment
Plaintiffs' contention in this case is that the Restructuring Orders violate their rights under PURPA because the Restructuring Orders can be interpreted as prohibiting Consumers and Detroit Edison from recovering a portion of their stranded costs after the year 2007. Plaintiffs assert that if that interpretation is correct, they stand to lose large amounts of their avoided cost rates because Consumers and Detroit Edison have the right to reduce their payments to Plaintiffs under the "regulatory out" clauses in Plaintiffs' PPAs.
Defendants contend that Plaintiffs' argument must be rejected because Plaintiffs' assertion that the Restructuring Orders may prevent utilities from recovering "stranded costs" beyond 2007 is premature and uncertain, the limitation on recovery of "stranded costs" in the Restructuring Orders only relates to customers who decide to purchase their electricity from alternate suppliers, and the MPSC has said in its orders that it has not revised the avoided cost rates in Plaintiffs' PPAs.
Based upon its review of the Restructuring Orders, the Court agrees with Plaintiffs that the limitation on recovery of "stranded costs" beyond the year 2007 in the Restructuring Orders can be interpreted in a manner that violates Plaintiffs' rights under PURPA to receive the full avoided cost rates from the utilities as set forth in their PPAs. Plaintiffs have shown that if the utilities are precluded from recovering their avoided costs, the utilities have the right to reduce their payments to plaintiffs pursuant to the "regulatory out" provisions in the PPAs. Thus, the Restructuring Orders can be interpreted in a manner that will deprive Plaintiffs of the full avoided cost rate which they are entitled to receive under PURPA.
The Court previously rejected Defendants' arguments that Plaintiffs have failed to present a case or controversy and that the Restructuring Orders do not violate PURPA because the MPSC has said that they do not do so. Thus, to the extent Defendants assert those arguments in response to the instant motions, the Court rejects them again. With regard to Defendants' argument that the limitation on recovery of stranded costs only applies to customers who elect to obtain an alternate supplier of electricity, the Court does not glean such a limitation from the Restructuring Orders and, in light of Defendants' refusal to admit that the Restructuring Orders do not prohibit the utilities from recovering their stranded costs beyond 2007, the Court cannot accept Defendants' argument.
Defendants concede that PURPA prohibits them from altering the avoided costs rates once the MPSC has approved them and have freely acknowledged that their orders do not affect Plaintiffs' rights under their PPAs in violation of PURPA. However, Plaintiffs were forced to file this action because Defendants would not acknowledge that the Restructuring Orders do not do indirectly what they cannot do directly: cause a reduction of Plaintiffs' avoided cost rates by precluding the utilities from recovering their avoided costs from ratepayers. Frankly, in light of Defendants' statement in their brief that "Commission-approved QF rates are recoverable by the utility from its ratepayers whether before or after 2007," this Court cannot imagine why Defendants were unwilling to say so in their orders.[6] Nonetheless, the Court concludes that Plaintiffs are entitled to declaratory and injunctive *810 relief in connection with their rights under PURPA and will enter an appropriate order.
II. Section 1983 Claim
Plaintiffs in case numbers 5:98-CV-21 and 5:98-CV-23 have alleged due process claims under 42 U.S.C. § 1983 and contend that they are entitled to attorneys fees under 42 U.S.C. § 1988 because they are prevailing parties. Although Defendants did not respond to this argument, the Court concludes that Plaintiffs may not base a § 1983 claim on a violation of PURPA. In Middlesex County Sewerage Authority v. National Sea Clammers Association, 453 U.S. 1, 101 S. Ct. 2615, 69 L. Ed. 2d 435 (1981), the United States Supreme Court held that a class of fisherman could not bring a § 1983 claim under the Federal Water Pollution Control Act (FWPCA) and the Marine Protective Research and Sanctuary Act of 1972 (MPRSA). See Middlesex County, 453 U.S. at 20-21, 101 S. Ct. at 2626-27. The Court found that because the FWPCA and the MPRSA provided comprehensive remedies, it could be inferred that Congress intended to preclude suits under § 1983 for violations of those laws. See id. at 20, 101 S. Ct. at 2626. The Court stated that "the existence of [] express remedies demonstrates not only that Congress intended to foreclose implied private actions but also that it intended to supplant any remedy that otherwise would be available under § 1983." Id. at 21, 101 S. Ct. at 2627.
In Municipal Electric Utilities Association of New York State v. Conable, 577 F. Supp. 158 (D.D.C.1983)(mem.op.), the court applied the holding in Middlesex County Sewerage Authority to reject the plaintiffs § 1983 claim. See Municipal Elec. Util., 577 F.Supp. at 163-64. The court reasoned that the FPA was a detailed statutory scheme that provided the plaintiff with specific statutory remedies, and thus the only remedies available were those provided under the FPA. See id. at 164.
The Court finds that the Middlesex County Sewerage Authority analysis is also applicable in this case. In particular, PURPA contains a detailed statutory scheme which provides specific remedies that enable QFs such as Plaintiffs to obtain judicial review of their rights under PURPA or under any rule or regulation promulgated by the FERC pursuant to PURPA. See 16 U.S.C. § 824a-3(g), (h). The specific and detailed remedies provided by the statute demonstrate congressional intent to preclude suits under § 1983 for violations of PURPA. Therefore, the Court finds that Plaintiffs may not maintain a claim under § 1983 based upon violation of their PURPA rights and, thus, are not entitled to attorney fees under § 1988.
Conclusion
For the foregoing reasons, the Court will grant Plaintiffs' motions for summary judgment with respect to their requests for declaratory and injunctive relief regarding their rights under PURPA. The Court will deny Plaintiffs' motions for summary judgment in case nos. 5:98-CV-21 and 5:98-CV-23 with regard to their § 1983 claims and requests for attorney fees under § 1988.
An Order consistent with this Opinion will be entered.
ORDER
In accordance with the Opinion filed this date,
IT IS HEREBY ORDERED that Plaintiffs' Motions for Summary Judgment in case nos. 5:98-CV-22 and 5:98-CV-24 (docket nos. 27 and 28) are GRANTED, and Plaintiffs' Motions for summary judgment in case nos. 5:98-CV-21 and 5:98-CV-23 (docket no. 30) are GRANTED IN PART AND DENIED IN PART. The motions in case nos. 5:98-CV-21 and 5:98-CV-23 are GRANTED with respect to Plaintiffs' claims for declaratory and injunctive relief with respect to their rights under PURPA and are DENIED with respect to Plaintiffs' claims under 42 U.S.C. *811 § 1983 and requests for attorneys fees under 42 U.S.C. § 1988.
IT IS FURTHER ORDERED, DECLARED AND ADJUDGED that:
A. The Michigan Public Service Commission's ("MPSC") orders of June 5, 1997, October 29, 1997, January 14, 1998, and February 11, 1998 (collectively the "Restructuring Orders"), are preempted by PURPA and the Supremacy Clause of the United States Constitution to the extent that they prohibit any utility from recovering from its customers any charge for avoided costs (or "stranded costs") to be paid to Plaintiffs as qualifying facilities under PURPA pursuant to power purchase agreements ("PPA") between such utilities and Plaintiffs;
B. The MPSC's prior orders approving that avoided cost rates set forth in Plaintiffs' PPAs take precedence over the Restructuring Orders, and the utilities are entitled to collect their avoided costs set forth in the PPAs from their customers;
C. Defendants are permanently enjoined from enforcing the Restructuring Orders in any manner which denies any utility from recovering its avoided costs as set forth in Plaintiffs' PPAs or which precludes Plaintiffs from recovering the full avoided cost rate as set forth in their PPAs, including but not limited to interpreting or enforcing the Restructuring Orders to preclude any utility from recovering all or any portion of its avoided costs previously approved by the MPSC from its customers, whether before, during, or after the year 2007.
NOTES
[1] Under the Federal Power Act, a "cogeneration facility" is a facility which produces electric energy and steam or forms of useful energy which are used for industrial, commercial, heating, or cooling purposes. See 16 U.S.C. § 796(18)(A). A "qualifying cogeneration facility" is a cogeneration facility which meets the requirements set by the Federal Energy Regulation Commission and is owned by a person not primarily engaged in the generation or sale of electric power. See 16 U.S.C. § 796(18)(B).
[2] The Court previously dismissed the MPSC as a defendant on the grounds of Eleventh Amendment immunity. See North Am. Natural Resources, Inc. v. Michigan Pub. Serv. Comm'n, 41 F. Supp. 2d 736, 745 (W.D.Mich. 1998).
[3] Defendants appear to argue that the MPSC has never approved the rates in Plaintiffs' PPAs. (See Defs.' Br. at 17.) Defendants first assert that "[t]he [MPSC] has set an avoided capacity or energy rate which may or may not the rate" in Plaintiffs' PPAs, but then concede that "rates were approved on a case-by-case basis within the specific context of reviewing specific contracts between QFs and Michigan utilities." (Id.) The Court finds that Defendants' unsupported and ambiguous assertions are insufficient to create a genuine issue of material of fact because Defendants essentially concede that the MPSC has approved the rates in Plaintiffs' PPAs and Plaintiffs have cited various MPSC orders showing that the MPSC did in fact approve the rates. See In re Midland Cogeneration Venture Ltd. Partnership, Case No. U-8871, et al., at 2 (Feb. 22, 1990, MPSC Opinion and Order).
[4] Also known as "transition costs," "stranded costs" include utility companies' costs that were incurred prior to deregulation that are above market prices during deregulation and costs incurred in the transition from monopoly status to competitive market status. (See Pls.' Br. Supp. (Case No. 5:98-CV-21) Ex. B at 12.)
[5] A "regulatory-out" clause provides for renegotiation of rates or termination of the purchase contract in the event a judicial, administrative, or other governmental agency takes some action that impairs the utility's ability to recover its costs from ratepayers. See Freehold, 44 F.3d at 1193 n. 12.
[6] Plaintiffs have presented evidence which establishes that Defendants actually interpret the Restructuring Orders as precluding recovery of stranded costs after the year 2007. See In re Detroit Edison Co., Case No. U-11726 (Dec. 28, 1998 MPSC Opinion & Order) (permitting Detroit Edison to accelerate amortization of its Fermi 2 nuclear power plant on the basis that limitation period in Restructuring Orders was insufficient to permit recovery of stranded costs). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1778171/ | 420 So. 2d 1041 (1982)
James Kiley THAMES
v.
DAVIS & GOULET INSURANCE, Inc.
No. 53347.
Supreme Court of Mississippi.
August 25, 1982.
Rehearing Denied November 10, 1982.
Watkins & Eager, James L. Carroll, Jamie G. Houston, III, Jackson, for appellant.
W.E. Gore, Jr., Jackson, for appellee.
Before SUGG, HAWKINS and PRATHER, JJ.
HAWKINS, Justice, for the Court:
James Kiley Thames has appealed an order of the Chancery Court of the First Judicial District of Hinds County overruling his motion to dissolve a temporary injunction of that court previously issued against him, which enjoined him from soliciting any customers or policy holders of the complainant Davis & Goulet Insurance, Inc., listed on Exhibit C to the bill of complaint.
We address on this appeal the propriety of the injunction.
Davis & Goulet Insurance, Inc., is a Mississippi corporation engaged in the insurance business in Jackson as local agent for several casualty insurance companies. Mr. Thames was employed by Davis & Goulet on May 7, 1975, as a salesman and agent of the company under a written contract. We quote the heading and pertinent parts:
CONTRACT OF EMPLOYMENT BETWEEN DAVIS AND GOULET INSURANCE, INC., HEREINAFTER CALLED THE COMPANY
AND
JAMES KILEY THAMES HEREINAFTER REFERRED TO AS THAMES
(1) Company agrees to employ Thames as a solicitor and/or Agent in the business of the Company, and Thames agrees to devote his full time, energy, ability, skill and services to the business of the Company, more particularly to the business of selling and soliciting insurance.
(4) It is understood and agreed that this contract may be terminated at any time by giving (30) thirty days notice by either party to the other, and compensation to the said Thames will cease at the end of the said 30 days, and for this purpose the books of the Company shall be closed at the end of such 30 days.
(5) The said Thames agrees that, in the event this agreement is terminated, he *1042 will not solicit, directly or indirectly, business of any customer of the Company, whether said customer be originally obtained by said Thames or others, nor will the said Thames attempt in any way to influence any other agents of the Insurance Companies in any manner operating under or through Company. The said Thames agrees that the names or lists of customers and any other business affairs of Company, are the sole property of the Company and the said Thames agrees that, during the lifetime of this contract, he will disclose nothing apertaining [sic] thereto to any persons, nor in the event of termination of this contract will he hereafter use any information thus acquired for his own use or directly or indirectly divulge same to any parties.
The contract also gave Thames the option, following one year's employment, to purchase a small number of shares in the corporation.
On August 26, 1980, Thames notified Davis & Goulet that he intended to resign from his employment, and a month later he left the business and began working with another insurance agency.
The bill of complaint was filed February 3, 1981, seeking to enjoin Thames from violating the contract, exhibited to the bill, and for a judgment against him for commissions earned in violation of the contract. The complaint made no allegation of the reasonableness or need for the restraint imposed by the contract, or background or circumstances surrounding its execution. An answer setting forth several defenses, and denying complainant's right to any relief, was filed along with a general demurrer on February 10.
On that date the chancellor conducted a hearing on whether to issue a temporary injunction, following which an order granting a temporary injunction was issued by the court February 12, enjoining Thames from soliciting any customers or policy holders listed on Exhibit C to the complaint, upon the filing of an injunction bond payable to Thames in the sum of $5,000.
On March 2, Thames filed a motion to dissolve the temporary injunction, on which a hearing was conducted March 13, and the chancellor by order dated May 1, 1981, overruled the motion.
In both hearings before the chancellor, Davis & Goulet offered no proof of its economic need for the post-employment restraint imposed by the contract, or its reasonableness, or any circumstances or background to the execution of the contract supporting such restraint.
Thames, on the other hand, testified that Davis & Goulet gave him no training in the insurance business, and that he was fully trained when he was employed by the firm. He testified that the only customers he was interested in soliciting were friends and relatives of his who he had put on the books, and except for their personal relation to him, would not be customers of Davis & Goulet. He also testified that a considerable financial hardship would be imposed on him if he was prohibited from soliciting these parties as customers.
After the rendition of the order overruling the motion to dissolve the temporary injunction, Thames petitioned for an interlocutory appeal, which was denied by the chancellor May 20. This Court granted an interlocutory appeal June 17.
The assignments of error we address are the finding by the chancellor that the contract was enforceable and the injunction was proper.
LAW
The chancellor imposed a limited restraint upon Thames in the injunction. In this case we do not reach the enforceability of this restraint imposed by contract, whether it was reasonable or not, because procedurally Davis & Goulet failed to meet the burden of proof imposed upon it in seeking to enforce the contract.
This Court has examined several contracts imposing post-employment restraints upon competition. See Texas Road Boring Company of Louisiana-Mississippi v. Parker, 194 So. 2d 885 (Miss. 1967); Landry v. Moody Grishman Agency, Inc., 254 Miss. 363, 181 *1043 So.2d 134 (1965); Redd Pest Control Company, Inc. v. Heatherly, 248 Miss. 34, 157 So. 2d 133 (1963); Bagwell v. H.B. Wellborn & Company, 247 Miss. 564, 156 So. 2d 739 (1963); Frierson v. Sheppard Building Supply Co., Inc., 247 Miss. 157, 154 So. 2d 151 (1963); Donahoe v. Tatum, 242 Miss. 253, 134 So. 2d 442 (1961); and Wilson v. Gamble, 180 Miss. 499, 177 So. 363 (1937).
In Donahoe v. Tatum, supra, we stated:
It is the law's function to maintain a reasonable balance in this area. This requires us to recognize that there is such a thing as unfair competition by an ex-employee as well as by unreasonable oppression by an employer. The circumstances in each case will be carefully scrutinized to determine whether it falls within or without the boundary of enforceability. Id. 242 Miss. at 261, 134 So.2d at 445 (citations omitted).
In Texas Road Boring Company of Louisiana-Mississippi v. Parker, supra, we stated:
Non-competition agreements are not favored in law and in considering them, courts recognize there are three major aspects to be looked to: the rights of the employer, the rights of the employee, and the rights of the public... .
* * * * * *
The recurrent theme of these cases is that restrictive covenants are not favored in law; the employer has the burden of proving their reasonableness; and the reasonableness as to time and space limitations must be determined from the facts of each case.
Id. at 888-89 (emphasis added).
One of the landmark cases on this subject is Arthur Murray Dance Studios of Cleveland v. Witter, 62 Ohio Law. Abs. 17, 105 N.E.2d 685 (1952). This case, quoted in numerous cases throughout the United States and in law journal articles, details and amplifies somewhat the general statements in our Mississippi cases of the procedural obligation of an employer who seeks to enforce such a contract:
In this type of case, heavy procedural burdens impede the plaintiff employer. Because the restraint sought to be imposed is one which restricts the exercise of a gainful occupation, it is a restraint in trade... . It is cautiously considered, carefully scrutinized, looked upon with disfavor, strictly interpreted and reluctantly upheld... . Being a contract in restraint of trade it is presumptively void. The employer shoulders the burden of proving the restraint reasonable and the contract valid... . Even where the restraint is partial, the rule is not that it is good, but that it may be good.... The fact that an employer has a written agreement that the employee will not, on leaving his employment, compete with his employer, that the employee breaks that agreement, that the employee quits his employer, that the employee starts working for a rival, and that the rival thereby becomes a more efficient competitor, all this, without more, does not automatically entitle the employer to an injunction. ... Since this is an equitable action, the employer must establish the standard requirements for equitable intervention... . 105 N.E.2d at 693-94 (citations omitted) (emphasis added).
See also Richardson v. Paxton Company, 203 Va. 790, 795, 127 S.E.2d 113, 117 (1962); 43A C.J.S. Injunctions § 210 (1978), at 442-43, 447-48, and cases cited.
As above noted, this Court is committed to the general rule requiring the ex-employer in a case such as this to demonstrate to the trial court the economic justification, the reasonableness of the restraint which is sought to be imposed. Davis & Goulet did not plead in its complaint any special reason or necessity why the contract should be enforced. Furthermore, at both hearings it offered no proof whatever as to the reasonableness, necessity or purpose of the contractual prohibition. It simply offered the contract and proof as to alleged violations. This without more did not afford sufficient ground for injunctive relief *1044 under the general rule in cases of this nature.[1]
We do not reach these factors in this case, however, because no proof of reasonableness or necessity was offered by Davis & Goulet.
While he may not have been required to do so in the posture of the case at the hearing, it is also to be noted that Thames offered proof as to why post-employment restraint should not have been imposed upon him.
We must therefore hold that the chancellor was in error in issuing the temporary injunction.
REVERSED AND RENDERED.
PATTERSON, C.J., SUGG and WALKER, P.JJ., BROOM, ROY NOBLE LEE, BOWLING, DAN LEE, and PRATHER, JJ., concur.
NOTES
[1] In the cases cited from this Court, we have listed many of the circumstances a chancellor may consider in determining whether a post-employment restraint is reasonable and enforceable. See also Arthur Murray Dance Studios, supra, for detailed analysis of such factors. Two leading law journal articles are: Blake, Employee Agreements Not to Compete, 73 Harv.L.Rev. 625 (1960); and Grody, Partial Enforcement of Post-Employment Restrictive Covenants, 15 Colum.J.L. & Soc.Probs. 181 (1979). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1826733/ | 691 So. 2d 1245 (1997)
Gerard OSBORNE and Edna Osborne
v.
Cathryn Fricke LADNER and Terminix International Company Limited Partnership.
No. 96 CA 0863.
Court of Appeal of Louisiana, First Circuit.
February 14, 1997.
*1248 Arthur R. Cooper, Baton Rouge, for Plaintiffs/Appellees Gerard and Edna Osborne.
Ann M. Halphen, Baton Rouge, for Defendant/Appellant Sandy Pritchard.
David C. Forrester, Baton Rouge, for Defendant/Appellant Cathryn Fricke Ladner.
*1249 Walter W. Christy, Thomas P. Hubert, New Orleans, for Defendant Allied-Bruce Terminix Companies, Inc.
Before CARTER, LeBLANC and PARRO, JJ.
CARTER, Judge.
This is an appeal from a trial court judgment, awarding the purchasers of a home a reduction in price and damages against the seller and finding the real estate agent liable in solido with the seller for a portion of the damages.
FACTS
On December 14, 1990, petitioners, Gerard and Edna Osborne, purchased a home located at 14244 Harwood Avenue in Woodland Ridge Subdivision, Baton Rouge, Louisiana, from defendant, Cathryn Fricke Ladner (Ladner), for $178,500.00. Within a few weeks of the sale, the Osbornes became aware of various leaks and termite infestation in the home. Repair estimates showed the cost to correct the damage was approximately $26,000.00.
On August 11, 1991, the Osbornes filed a suit for a reduction in the purchase price and, alternatively, for rescission of the sale and for damages for breach of contract. Named in the petition were Ladner and Allied-Bruce Terminix Companies, Inc. (Terminix).[1] The Osbornes claimed that Ladner knew of the allegedly defective condition of the home, failed to declare it to them prior to the sale, and was liable for damages as a result of her bad faith. The Osbornes alleged that Terminix breached its obligations under the termite contract and, alternatively, that Terminix had negligently inspected the premises prior to the sale.
Ladner filed an answer to the Osbornes' petition, generally denying the allegations. In her answer, Ladner contended that the alleged defects in the premises were apparent and should have been discovered by simple inspection. Ladner further alleged that the Osbornes failed to mitigate their damages by their delay in repairing the damage and by refusing to allow her to correct the damage. Ladner also filed a cross-claim against Terminix for contribution and indemnity. Ladner alleged that, at all pertinent times, Terminix held a termite treatment contract on the property and had continued to certify that the property was free of active termite infestation.
Terminix answered the claims of the Osbornes and Ladner. In its answer to the claims by the Osbornes, Terminix generally denied any liability.[2] In its answer to Ladner's cross-claim, Terminix alleged that the active termite damage was caused by an aerial infestation of subterranean termites for which it is not responsible.
On October 20, 1993, the Osbornes amended their petition, naming as a defendant Sandy Pritchard, the listing agent in the sale from Ladner to them. The Osbornes alleged that Pritchard knew of the defects in the Ladner home and misrepresented those defects to them for which she should be held solidarily liable with Ladner.
Pritchard answered the original and amended petitions, generally denying the allegations. Pritchard also filed a cross-claim against Terminix and Ladner, alleging that Terminix failed to properly inspect, detect, and exterminate and that Ladner failed to disclose the defects.
After a jury trial, the jury returned the following jury verdict interrogatories:
1. Do you find the residence at 14244 Harwood Avenue, Baton Rouge, Louisiana, contained a hidden defect that was not discoverable by simple inspection by the Osbornes?
x YES ___ NO
*1250 2. Do you find that Sandy Pritchard negligently and knowingly misrepresented the condition of the house to the Osbornes?
x YES ___ NO
(If you answer NO to both questions, stop now and return to the courtroom.)
3. Do you find Terminix breached its contract with the Osbornes or the Ladners and that breach caused the Osbornes damages?
___ YES x NO
4. Do you find that Terminix negligently failed to perform its duties in preparing the wood-destroying [insect] report and the negligence caused the Osbornes damage?
___ YES x NO
5. What amount of damages do you award to the Osbornes as a result of the defects?
$36,138.94
6. If you answer "YES" to Question 3 or 4, do you find that the termite damage contributed to the defects in the residence at 14244 Harwood?
___ YES ___ NO
7. What amount of damages awarded in response to Question No. 5, do you find are as a result of termite damage?
$9,165.198.
8. What amount of damages awarded in response to Question No. 5 do you find are a result of failure to disclose a material defect by Sandy Pritchard?
$2,677.509.
9. Do you find that Cathy Ladner was a bad faith seller who concealed the defects in the house?
x YES ___ NO
10. If your answer to No. 9 is YES, what amount, if any, do you award the Osbornes for emotional distress, mental pain and suffering?
$5,000.00
On October 11, 1995, the trial court rendered judgment in favor of the Osbornes and against Ladner for $41,138.94, together with legal interest from date of judicial demand and costs, and $7,500.00 in attorney's fees, with legal interest from date of judgment.[3] The trial court judgment also cast Pritchard liable in solido with Ladner for $20,569.47, together with legal interest from date of judicial demand and costs.[4] The judgment also stated that Ladner and Pritchard were entitled to contribution and indemnity rights as provided by law. Judgment was rendered in favor of Terminix, dismissing all claims brought against it.[5]
From this adverse judgment, Pritchard suspensively appealed, and Ladner devolutively appealed, assigning various errors. On appeal, Ladner contends that the trial court erred in the jury instructions, in an evidentiary ruling, in the damage award for various repair items, in finding that she was a bad faith seller, and in finding that Terminix was not liable.[6] In her assignments of error, *1251 Pritchard contends that the jury erred in finding her liable for negligent misrepresentation and awarding the Osbornes $2,677.50 in damages as a result of such negligent misrepresentation.[7] Pritchard also contends that the jury erred in holding her liable in solido for damages of $20,569.47. The Osbornes answered the appeals, requesting additional attorney's fees on appeal.
EVIDENTIARY RULING
(Ladner's Assignment of Error No. 4)
Ladner contends that the trial court erred in refusing to allow the introduction of evidence and the cross-examination of Mr. Osborne relative to the issue of mitigation of damages. Ladner contends that the jury should have been permitted to receive evidence relative to her offers to repair the property in 1991 and Mr. Osborne's financial ability to repair the home and mitigate his damages. Ladner reasons that this evidence was relevant to the mitigation of damages issue.
Generally, parties should be given the opportunity to cross-examine witnesses on any relevant matter. Thibaut v. Thibaut, 607 So. 2d 587, 600 (La.App. 1st Cir.1992), writs denied, 612 So. 2d 37, 38, & 101 (La. 1993). The determination of the relevancy of tendered evidence and, therefore, the scope of cross-examination is within the discretion of the trial judge, whose rulings will not be disturbed in the absence of abuse of discretion. State v. Lard, 568 So. 2d 629, 632 (La. App. 2nd Cir.1990). However, it is well settled that the party who contends his evidence was improperly excluded is required to make a proffer of the evidence, and if he fails to do so, he cannot contend such exclusion was erroneous. Hurts v. Woodis, 95-2166, p. 12 (La.App. 1st Cir. 6/28/96), 676 So. 2d 1166; 676 So. 2d 1166, 1175; Williams v. Exxon Corporation, 541 So. 2d 910, 912-913 (La.App. 1st Cir.), writ denied, 542 So. 2d 1379 (La. 1989).
In the instant case, Ladner failed to proffer any of the evidence she alleges was improperly excluded. As a result, she now cannot complain that such exclusion was error.
JURY INSTRUCTIONS
(Ladner's Assignments of Error Nos. 1, 2, 4, 5, 7, and 9)
Ladner contends that the trial court erred in failing to conduct a charge conference prior to giving instructions to the jury and in failing to allow objections to the jury instructions prior to the jury's retirement. Ladner further contends that the jury instructions given by the trial court were erroneous in several respects. First, the instructions given were on damages recoverable in an action for rescission rather than for damages recoverable in an action for reduction. As a result, the jury erroneously awarded damages for various repairs, such as remodeling, apparent defects, and new shingles. Second, the trial court failed to provide any instructions relative to various relevant issues, including instructions on mitigation of damages and attempts to repair, the distinction between good faith and bad faith sellers and their respective liabilities for damages, the existence of any duty owed by Terminix to the Osbornes, and solidary liability between Ladner and Pritchard.
LSA-C.C.P. art. 1793 outlines the procedure by which objections to the proposed jury instructions are to be made as follows:
A. At the close of the evidence, or at such earlier time as the court reasonably directs, a party may file written requests that the court instruct the jury on the law as set forth in the requests.
B. The court shall inform the parties of its proposed action on the written requests and shall also inform the parties of the instructions it intends to give to the jury at the close of the evidence within a reasonable time prior to their arguments to the jury.
C. A party may not assign as error the giving or the failure to give an instruction *1252 unless he objects thereto either before the jury retires to consider its verdict or immediately after the jury retires, stating specifically the matter to which he objects and the grounds of his objection. If he objects prior to the time the jury retires, he shall be given an opportunity to make the objection out of the hearing of the jury.
This provision creates a mandatory rule for preserving an objection to a trial court's ruling regarding requested jury instructions. Martin v. Francis, 600 So. 2d 1382, 1387 (La.App. 1st Cir.), writ denied, 606 So. 2d 541 (La.1992). In order to preserve the right to appeal a trial court's refusal to give a requested instruction or its giving of an erroneous instruction, a party must not only make a timely objection, but must state the grounds of his objection. Martin v. Francis, 600 So.2d at 1387; Cole v. Celotex Corporation, 588 So. 2d 376, 380 (La.App. 3rd Cir.1991), affirmed, 599 So. 2d 1058 (La.1992). See Trans-Global Alloy Limited v. First National Bank of Jefferson Parish, 583 So. 2d 443, 448 (La.1991). Merely making an objection, without assigning any reasons therefor, is insufficient. Martin v. Francis, 600 So.2d at 1387.
Initially, we must determine whether Ladner properly preserved her objections to the allegedly improper jury instructions. After all the parties had rested their cases, counsel for Ladner requested a bench conference during which an off-the-record colloquy took place between the trial judge and counsel. Counsel then presented their closing remarks to the jury, and the trial judge instructed the jury. Thereafter, the jury retired to deliberate. Counsel for the Osbornes then offered objections to the jury instructions, which the court ruled were not timely filed. Counsel for the Osbornes stated that he was under the assumption there would be a charge conference. The trial judge indicated that the discussion regarding jury instructions had taken place during the off-the-record colloquy prior to closing arguments. Counsel for the Osbornes and Ladner then made objections on the record to the effect that the proposed charges submitted by each were not given. In objecting to the proposed jury instructions, Ladner made a general, blanket objection to the court's failure to read her proposed jury instructions without any qualification. The transcript of the trial reveals the following statements with regard to the objections to the instructions:
Mr. Cooper: .... I wanted to object for the record regarding the instructions that I had submitted and the ones that were not given by the court for the record, the failure of the court to give them, just for the record.
Mr. Forrester: Me too. Defendant objects to any charges that it offered that were not given, whatever those were.
The Court: Let the record reflect, for clarity sake, that the court reads the instructions from the Louisiana Judicial College, and where there were instructions submitted by either party that did not conflict with and added something different to, the court did read them. (emphasis added.)
In the instant case, we find that Ladner's counsel failed to object properly to the allegedly erroneous or confusing instructions in that he failed to state the basis of his objection as required by LSA-C.C.P. art. 1793. By failing to properly object, Ladner forfeited any right to complain on appeal of the trial court's refusal to give her proposed jury charges. See Autin's Cajun Joint Venture v. Kroger Company, 93-0320, p. 7 (La. App. 1st Cir. 2/16/94); 637 So. 2d 538, 543, writ denied, 94-0674 (La.4/29/94); 638 So. 2d 224; Luman v. Highlands Insurance Company, 25,445, pp. 4-6 (La.App. 2nd Cir. 2/23/94); 632 So. 2d 910, 913-14; Martin v. Francis, 600 So.2d at 1387.
LIABILITY AS A BAD FAITH SELLER
(Ladner's Assignment of Error No. 6)
Ladner contends that the jury erred in finding that she was in bad faith. Ladner reasons that the evidence does not support a finding that she was in bad faith and that the award of damages for mental anguish and attorney's fees is, therefore, erroneous.
Generally, the amount of damages a plaintiff can recover depends upon the type *1253 of seller involved. Under LSA-C.C. art. 2531, a good faith seller, namely, one who knew not of the vices in the thing he sold, is required to repair, remedy, or correct the vices or defects in the property which he sold. If he is unable to do so, he must restore the purchase price and reimburse the reasonable expenses occasioned by the sale and those expenses incurred for the preservation of the property. LSA-C.C. art. 2531; Landaiche v. Supreme Chevrolet, Inc., 602 So. 2d 1127, 1132 (La.App. 1st Cir.1992); Sonfield v. Burleson, 543 So. 2d 488, 493 (La.App. 4th Cir.), (on rehearing), writ denied, 546 So. 2d 1220 (La.1989). LSA-C.C. art. 2545 provides that the seller who knows the vice of the thing which he sells and omits to declare it is answerable to the buyer in damages. Besides restitution of the price and repayment of expenses, including reasonable attorney's fees, the bad faith seller is also answerable for other damages. LSA-C.C. art. 2545. Under the proper circumstances, those damages can include non-pecuniary damages for mental anguish, aggravation, and inconvenience. Landaiche v. Supreme Chevrolet, Inc., 602 So.2d at 1132; St. Claire v. Lewis, 550 So. 2d 737, 739 (La.App. 2nd Cir.1989); Ditcharo v. Stepanek, 538 So. 2d 309, 314 (La.App. 5th Cir.) (on rehearing), writ denied, 541 So. 2d 858 (La.1989); Leflore v. Anderson, 537 So. 2d 215, 218-19 (La.App. 4th Cir.1988).
In the instant case, the evidence presented at trial supports the jury determination that Ladner was in bad faith.
At the time of Ladner's purchase of the home, the sellers had advised that the stucco had been defectively installed and that, during their ownership of the home, they had encountered a problem with a leak. However, the sellers stated that the crack in the stucco was sealed with a filler, which appeared to remedy the problem. During Ladner's ownership of the Harwood Avenue home, Ladner encountered numerous problems with leaks. Ladner's husband, Keith, testified that, between July 31, 1989, through the date of the sale of the home to the Osbornes, he performed all maintenance on the home. Keith first found a leak in the living room. However, he went onto the roof and patched a crack in the stucco, which appeared to resolve the problem. Later, Keith located other leaks in the dining room near the window, in the utility room, near the hall, and in the garage. However, Keith testified that he sealed the leaks by placing filler in the cracks in the stucco or by caulking the areas. Generally, after he filled a crack, it did not leak in that area again. Keith testified that they did not have any trouble with leaks for some time prior to the sale to the Osbornes.
Keith also admitted that he had painted over water marks on the walls where there had been leaks. He acknowledged that he did not tell the Osbornes about the leaks because he felt that the disclosure form he completed did so sufficiently. Keith also admitted to finding a rusty pan in the attic where the sellers had apparently attempted to contain water from the leaks.
Richard L. Howell, a Baton Rouge builder, testified, via deposition, that he inspected the Harwood Avenue home in April of 1991. Howell noted that water was coming into the home in several areas and in major proportions. Howell observed several stains on the walls, which had been painted over. He also observed a pan and a glass in the attic, which were concealed behind some insulation. According to Howell, the items had been there for some time.
William Watson, a general contractor, was admitted as an expert in residential construction. Watson testified that anyone residing in the Harwood Avenue home for more than a year would have been aware of the water problem.
With regard to the termite damage, Keith Ladner testified that the home was treated for termite problems in 1990, but that he never saw any swarms or other indicia of the presence of termites. However, John Edward McPherson, an entomologist, testified that he inspected the Harwood Avenue home on September 4, 1991, and located active termite infestation in two areas. According to McPherson, it would have taken a termite colony four to five years to do the kind of damage he observed. Moreover, McPherson noted that anyone living in the home for more than a year would have observed *1254 termite swarms during that period of time.
The disclosure form completed by Keith Ladner disclosed that the property had had termites in 1989. The form also indicated that the roof did not leak. However, Ladner qualified that response by noting that the stucco had cracked and leaked, but that the problem had been corrected.
Based on the above, we cannot say that the jury erred in finding that Ladner knew or should have known of the defects in the premises caused by the water damage and termite infestation and failed to declare it to the Osbornes. As such, the jury's determination that Ladner was in bad faith and is liable for damages as a bad faith seller is not manifestly erroneous.
LIABILITY OF TERMINIX
(Ladner's Assignment of Error No. 8)
Ladner contends that the jury erred in failing to find Terminix liable for the cost of the termite repairs to the home. Ladner reasons that Terminix issued termite certificates in connection with the sales of the Harwood Avenue home to her and to the Osbornes. The Harwood Avenue home was under contract with Terminix during her ownership of the home, and Terminix owed her a duty to faithfully fulfill its obligations under such contract. Alternatively, Ladner argues that Terminix owed a duty to use reasonable care in inspecting the home and issuing the termite certificates and breached its duty in the instant case. As a result, Ladner contends Terminix is liable for the cost of the termite damage.
A. Contract claims.
In interpreting contracts, we are guided by the general rules contained in articles 2045-2057 of the Louisiana Civil Code. Subject to the limits imposed by law, parties are free to contract as they choose. Zeigler v. Pleasant Manor Nursing Home, 600 So. 2d 819, 822 (La.App. 3rd Cir.1992). The cardinal rule is set forth in LSA-C.C. art. 2045, which states that the interpretation of a contract is the determination of the common intent of the parties. Amend v. McCabe, 95-0316, p. 7 (La.12/1/95); 664 So. 2d 1183, 1187; McCrory v. Terminix Service Co., Inc., 609 So. 2d 883, 885 (La.App. 4th Cir.1992). To determine the parties' intent, courts must first look to the words and provisions of the contract. When they are clear and explicit, no further interpretation may be made in search of the parties' intent. LSA-C.C. art.2046; Amend v. McCabe, 664 So.2d at 1187; McCrory v. Terminix Service Co., Inc., 609 So.2d at 885. Stated differently, when the language of the contract is unambiguous, the letter of the clause should not be disregarded under the pretext of pursuing its spirit. LSA-C.C. art.2046, Revision Comment (b).
To determine the meaning of words used in a contract, courts should give them their generally prevailing meaning. However, words of art and technical terms must be given their technical meaning when the contract involves a technical matter. LSA-C.C. art.2047; Schroeder v. Board of Supervisors of Louisiana State University, 591 So. 2d 342, 345 (La.1991). When the terms of a contract are susceptible of more than one interpretation, it is ambiguous, and parol evidence may be used to show the true intent of the parties. LSA-C.C. art.2048; McCrory v. Terminix Service Co., Inc., 609 So.2d at 885; Carter v. BRMAP, 591 So. 2d 1184, 1187 (La. App. 1st Cir.1991).
Whether a contract is ambiguous or not is a question of law. Carter v. BRMAP, 591 So.2d at 1188; Borden, Inc. v. Gulf States Utilities Company, 543 So. 2d 924, 928 (La.App. 1st Cir.), writ denied, 545 So. 2d 1041 (La.1989). Appellate review of questions of law is simply whether the trial court's interpretive decision is legally correct. O'Niell v. Louisiana Power & Light Company, 558 So. 2d 1235, 1238 (La.App. 1st Cir. 1990).
Paragraph 2 of the terms and conditions of the contract between Ladner and Terminix provided as follows:
Water leakage in treated areas, in interior areas or through the roof or exterior walls of the identified property may destroy the effectiveness of Terminix's treatment and is conducive to new infestation. *1255 Purchaser is responsible for making timely repairs as are necessary to stop water leakage. Upon completion of repairs by Purchaser, Terminix will provide additional treatment to control infestation at Purchaser's expense. Purchaser's failure to make timely repairs or purchase the additional necessary treatment will terminate this agreement automatically without further notice.
The terms of this liability provision, taken as a whole, are not susceptible to more than one interpretation. The rule of strict construction does not authorize perversion of a contract's language or the creation of ambiguity where none exists. Ransom v. Camcraft, Inc., 580 So. 2d 1073, 1077 (La.App. 4th Cir.1991). The contract's provisions clearly and explicitly state that the purchaser's failure to make timely repairs for water leakage in treated areas will terminate the agreement.
In the instant case, the facts reveal that water leaks were a problem in the Ladner home. Keith Ladner testified that he had repaired the leaks and that it had been some time since they encountered leaks. However, the other evidence presented reveals that the leaks continued and had not been resolved timely by Ladner. As such, we find that the jury did not err in refusing to find that Terminix breached any contractual obligation to Ladner.
B. Tort claims.
A pest control operator owes the purchaser of a home a duty of reasonable care, competence, or skill in ascertaining and/or communicating facts in a termite inspection report, even though the purchasers are not a party to the contract and have no direct or indirect contact with the inspector. Barrie v. V.P. Exterminators, Inc., 625 So. 2d 1007, 1016 (La.1993); Brouillette v. Ducote, 93-990, pp. 5-6 (La.App. 3rd Cir. 3/2/94); 634 So. 2d 1243, 1247; Doskey v. Hebert, 93-1564, p. 14 (La.App. 4th Cir. 9/29/94); 645 So. 2d 674, 681-82.
In the instant case, prior to the sale to the Osbornes, Terminix performed an inspection on the home and issued a wood destroying insect report on December 3, 1990. In the report, Terminix noted that there were areas of the property that were obstructed and inaccessible, but that no visible evidence of an active infestation from wood destroying insects was found. The report also noted that the property had first been treated on July 28, 1989, at which time termites had been discovered, but no infestation had been observed at the time of this report. However, on December 13, 1990, Terminix mailed Ladner a second report. In the second report, Terminix indicated that active termite infestation had indeed been located on the property.[8]
After the sale of the property from Ladner to the Osbornes, on March 22, 1991, Terminix treated an overhead beam, which showed existing moisture problems and damage. On September 10, 1991, Terminix discovered an area of wood rot and an active suspended colony of termites in the rear of the Harwood Avenue home. On February 7, 1992, Terminix located several exit holes in the sheet rock in the bedroom, which it attributed to a leak in the roof. On October 28, 1992, several tunnels were discovered near the garage and visible damage near the rear patio was found. A re-service work order, dated April 29, 1993, showed that Terminix had drilled through brick to treat a void between a planter box and the slab. On June 3, 1993, Terminix again treated the Harwood Avenue home by removing brick siding to expose stucco siding and drilling through the brick base to treat the slab. Later that month, Terminix again treated the Harwood Avenue home by drilling in the area of the French doors and applying the treatment chemicals. On October 28, 1993, additional termites were discovered in the main house and garage.
Moreover, the evidence presented at trial showed that there had been active termite infestation for four to five years. John Edward *1256 McPherson, an entomologist, testified that, unless it was an exceptionally large colony, it would have taken termites four to five years to do the type of damage that was done to the Harwood Avenue home.
Gerard Osborne testified that he was concerned about the disclosure of prior termite activity, but that he had been assured that the activity was old termite activity and not active termites. Moreover, Osborne testified that he was not advised that Terminix had discovered active termites ten to eleven days prior to the closing. The Osbornes relied on the report issued by Terminix on December 3, 1990, that indicated no presence of termite activity.
Based on the above, we find that the initial report issued on December 3, 1990, was inaccurate and misleading. Clearly, Terminix fell below the standard of care owed to the Osbornes by failing to disclose its discovery of termite activity, and this breach was a cause-in-fact of the structural damages to the home. The exhibits and testimony at trial reveal that costs directly attributable to the termite damage totaled $9,165.19; the effect of Terminix's liability for this damage is discussed below.
C. Solidary liability and the effect of the release of Terminix
LSA-C.C. art. 1797 provides that "[a]n obligation may be solidary though it derives from a different source for each obligor." James v. Formosa Plastics Corporation of Louisiana, 95-1794, p. 3 (La.App. 1st Cir. 4/4/96); 672 So. 2d 319, 321; Stonecipher v. Mitchell, 26,575, p. 5 (La.App. 2nd Cir. 5/10/95); 655 So. 2d 1381, 1386.
In Hoefly v. Government Employees Insurance Company, 418 So. 2d 575 (La.1982), the Louisiana Supreme Court provided the three requisites to find solidary obligations: first, each obligor is obliged to the same thing; second, each obligor may be compelled for the whole payment, and finally, payment by one exonerates the other from its obligation to the creditor. See also LSA-C.C. art. 1794. Differing sources of liability do not preclude an in solido obligation; the obligation may be in solido even though the obligations of the obligors arise from separate acts or by differing reasons. It is the co-extensiveness of the obligations for the same debt, not the source of liability, that determines the solidarity of the obligation. James v. Formosa Plastics Corporation of Louisiana, 672 So.2d at 322; Stonecipher v. Mitchell, 655 So.2d at 1386.
In the instant case, Terminix is liable to the Osbornes for the termite damage for the breach of its duty to properly report the termite infestation to them. Ladner's liability to the Osbornes for the termite damage arises out of her obligations as a seller. Accordingly, because each obligor is liable to the Osbornes for the entirety of the termite damage, they are solidarily liable for those damages.
LSA-C.C. art. 1803 sets forth a remedy for a solidary obligor who may be disadvantaged as a result of an obligee's decision to settle with another solidary obligor. LSA-C.C. art. 1803 provides, in pertinent part, that:
Remission of debt by the obligee in favor of one obligor, or a transaction or compromise between the obligee and one obligor, benefits the other solidary obligors in the amount of the portion of that obligor.
According to this article, the solidary obligor who has not settled with the obligee is entitled to have the obligee's recovery reduced by the amount of the released obligor's portion of fault or liability. LSA-C.C. art. 1803, Revision Comment (b). When an obligee settles with and releases a solidary obligor, the remaining solidary obligors are deprived of their right to contribution against the solidary obligor who has been released. Mott v. Brister's Thunder Karts, Inc., 95-410, p. 3 (La.App. 3rd Cir. 10/4/95); 663 So. 2d 233, 235.
In the instant case, Terminix was a named defendant in the Osbornes' action, and Ladner filed a third-party demand against Terminix for the termite damage to the Harwood Avenue home, in the event she was held liable to the Osbornes. When the Osbornes released Terminix, any right Ladner may have had against Terminix in contribution was lost. Pursuant to LSA-C.C. art. *1257 1803, Ladner is entitled to have the Osbornes' damages reduced.
Because the jury did not find Terminix liable, it did not apportion fault.[9] However, having found that the jury erred in failing to hold Terminix liable on the third-party demand, we must apportion fault between Terminix and Ladner.
LSA-C.C. art. 1804 addresses the apportionment of liability between solidary obligors and provides, in pertinent part, as follows:
Among solidary obligors, each is liable for his virile portion. If the obligation arises from a contract or quasi-contract, virile portions are equal in the absence of agreement or judgment to the contrary. If the obligation arises from an offense or quasi-offense, a virile portion is proportionate to the fault of each obligor.
A solidary obligor who has rendered the whole performance, though subrogated to the right of the obligee, may claim from the other obligors no more than the virile portion of each.
In the instant case, Ladner's obligations arose out of a contract or quasi-contract, and the duty of Terminix arose from an offense or quasi-offense. We have reviewed the entire record in this matter and find liability should be apportioned equally between Ladner and Terminix. Therefore, the cost of repairing the termite damage of $9,165.19 should be borne equally by Ladner and Terminix. Accordingly, we find that the judgment in favor of the Osbornes and against Ladner should be reduced by $4,582.59.
NEGLIGENT MISREPRESENTATION
(Pritchard's Assignment of Error No. 1)
Pritchard contends that the jury erred in finding her liable to the Osbornes for negligent misrepresentation. Pritchard contends that she had no knowledge of any defect other than those which the Ladners disclosed to her, which she communicated to Pat Wattam, the real estate agent for the Osbornes.
A purchaser's remedy against a real estate broker is limited to damages for fraud under LSA-C.C. art.1953 et seq. or for negligent misrepresentation under LSA-C.C. art. 2315. Duplechin v. Adams, 95-0480, p. 5 (La.App. 1st Cir. 11/9/95); 665 So. 2d 80, 84, writ denied, 95-2918 (La. 2/2/96); 666 So. 2d 1104; Reeves v. Weber, 509 So. 2d 158, 160 (La.App. 1st Cir.1987); Rodgers v. Johnson, 557 So. 2d 1136, 1138 (La.App. 2nd Cir.1990). The action for negligent misrepresentation arises ex delicto, rather than from contract. In order for a plaintiff to recover for negligent misrepresentation, there must be a legal duty on the part of the defendant to supply correct information, a breach of that duty, and damage to the plaintiff caused by the breach. Duplechin v. Adams, 665 So.2d at 84; Smith v. Remodeling Service, Inc., 94-589, p. 7 (La.App. 5th Cir. 12/14/94); 648 So. 2d 995, 999. A real estate broker or agent owes a specific duty to communicate accurate information to the seller and the purchaser and may be held liable for negligent misrepresentation. Duplechin v. Adams, 665 So.2d at 84; Smith v. Remodeling Service, Inc., 648 So.2d at 1000; Josephs v. Austin, 420 So. 2d 1181, 1185 (La.App. 5th Cir.1982), writ denied, 427 So. 2d 870 (La. 1983). However, the duty to disclose any material defects extends only to those defects of which the broker or agent is aware. Reeves v. Weber, 509 So.2d at 160.
In the instant case the evidence revealed that, during Ladner's ownership of the home, she encountered problems with leaks, which her husband, Keith, attributed to the cracks in the stucco. According to Keith, on those occasions when he discovered the leaks, he advised Pritchard. In fact, Keith testified that, during the eighteen months his wife owned the home, he telephoned Pritchard several times. Keith acknowledged that any problems they had with leaking occurred within the first six months of their ownership and that it had been more *1258 than one year since he had reported any leaks to Pritchard. Keith also testified that he provided the information to place on the disclosure sheet, advising the Osbornes that the roof did not leak and that cracks in the stucco caused leaks, but that those areas had been repaired.
Sandy Pritchard testified that, at the time of the sale, she had no knowledge of the condition of the interior structural problems caused by the termite damage or leaking. Pritchard testified that she had been a social guest in the Ladner home on numerous occasions and had neither seen a leak nor did she see the type of damage giving rise to this suit. According to Pritchard, during the listing period, she observed nothing that indicated any leaking or the kind of problems with water or termite damages which ultimately developed with the home. Pritchard recalled several conversations with Keith about leaks during Ladner's ownership of the home. However, Keith always represented that the leaks had been corrected. In completing the disclosure form, Pritchard met with both Ladner and Keith. The information supplied to her revealed that the roof was not a problem and did not leak and that the stucco had leaked, but that it had been more than a year since the Ladners had any such leaks.
Patricia Wattam, the real estate agent who represented the Osbornes in the purchase of the Harwood Avenue home, testified that she observed water marks on a wall when she showed the home to the Osbornes. Wattam testified that Pritchard advised her that there had been prior leaks in the home, but that the problems had been corrected.
Based on the above, we conclude that the jury erred in finding that Pritchard breached her duty to supply the correct information to the Osbornes. The uncontradicted testimony presented at trial revealed that Pritchard was provided with information about leaks in the stucco by Ladner or Keith, which she, in turn, disclosed to Wattam and the Osbornes. There is no evidence that Pritchard knew more than what she was told by Ladner and Keith. Accordingly, that portion of the judgment casting Pritchard liable is reversed.
DAMAGE AWARD
(Ladner's Assignment of Error No. 3)
Ladner contends that the jury erred in its damage award. Ladner reasons that numerous items of damage were improperly awarded because they were for discretionary remodeling repairs, for apparent defects, or for items negotiated prior to closing.
As noted earlier, besides restitution of the price and repayment of expenses, including reasonable attorney's fees, the bad faith seller is answerable also for other damages. LSA-C.C. art. 2545. Under the proper circumstances, those damages can include non-pecuniary damages for mental anguish, aggravation, and inconvenience. Landaiche v. Supreme Chevrolet, Inc., 602 So.2d at 1132; St. Claire v. Lewis, 550 So.2d at 739. Moreover, the proper measure of damages in an action for reduction is the difference between the actual sales price and the price a reasonable buyer and seller would have agreed upon, if they had known of the defect. Lusk v. Durham Pontiac-Cadillac, Inc., 459 So. 2d 1277, 1280 (La.App. 1st Cir.1984). However, the cost of repairing a redhibitory defect is a principal consideration in determining the extent to which the purchase price should be reduced based on such defects. Besse v. Blossman, 521 So. 2d 570, 573 (La.App. 1st Cir.1988). The burden of establishing the amount of any reduction in the purchase price to which the buyer is entitled is upon the buyer. Sanders v. Sanders Tractor Company, Inc., 480 So. 2d 913, 917 (La. App. 2nd Cir.1985). The trier of fact has much discretion to assess the amount of recovery in reduction cases, and its award will not be modified in the absence of clear abuse of that discretion. Leonard v. Daigle Pontiac-Buick-GMC, Inc., 413 So. 2d 577, 580 (La. App. 1st Cir.1982).
In the instant case, Richard L. Howell, a Baton Rouge builder, testified that, in early 1991, he inspected the Harwood Avenue home for the Osbornes and provided an estimate to repair the water damage and correct the deficiencies in the property. Howell's bid was for $26,650.00. On May 20, 1993, Bill Watson, another Baton Rouge *1259 contractor, prepared an estimate to repair the water damage and correct the leaking problems. Watson's estimate totaled $26,192.10. Watson also noted that his estimate only covered visible damages and that additional expenditures may be necessary if, during the process of making the repairs, hidden damage was discovered. Watson ultimately performed the repair work. The October 22, 1993, invoice reveals the original contract price of $26,192.10, plus an additional $1,000.00 for contract price changes and $2,807.90 in work attributable to hidden damage. The remainder of the $36,618.94 total damage award was attributable to termite damages.
We have reviewed the documentary evidence and testimony relative to the repairs made and the reasonableness of those expenditures and cannot say that the jury abused its discretion in making its damage award.
Because of our resolution of these issues, we find it unnecessary to address the other issues raised by Ladner and Pritchard.
ANSWER TO APPEAL
In the judgment, based upon the jury determination that Ladner was a bad faith seller, the trial court awarded the Osbornes $7,500.00 for attorney's fees against Ladner. Attorney's fees were not awarded against any other defendant. The Osbornes answered the appeal, requesting additional attorney's fees for opposing Ladner's appeal.
Generally, an increase in attorney's fees should be awarded when a party who was awarded attorney's fees in the trial court is forced to and successfully defends an appeal. Meche v. Harvey, Inc., 95-848, p. 7 (La.App. 3rd Cir. 12/6/95); 664 So. 2d 855, 859, writ denied, 96-0084 (La.3/8/96); 669 So. 2d 402.
With regard to those portions of the judgment in favor of the Osbornes and against Ladner, on appeal, we affirmed the majority of the trial court judgment. However, we reduced the judgment in favor of the Osbornes and against Ladner to reflect the impairment of Ladner's right of contribution against Terminix. Therefore, we find that additional attorney's fees are not warranted on appeal.
CONCLUSION
For the above reasons, the judgment of the trial court in favor of the Osbornes and against Pritchard is reversed. That portion of the trial court judgment in favor of the Osbornes and against Ladner is reduced from $41,138.94 to $36,556.35. In all other respects, the judgment of the trial court is affirmed. Costs are assessed against Ladner and the Osbornes, equally.
AFFIRMED IN PART, REVERSED IN PART, AND RENDERED.
NOTES
[1] Terminix was initially named in the litigation as Terminex International Company Limited Partnership. By supplemental and amending petition, filed October 10, 1991, Allied-Bruce Terminex Companies, Inc. was substituted as a defendant in place of Terminex International Company Limited Partnership.
[2] On October 26, 1994, pursuant to a motion and order of dismissal, the Osbornes dismissed their claims against Terminix, with prejudice.
[3] We note that the jury verdict form did not include an interrogatory regarding attorney's fees and that the judgment awarded the Osbornes attorney's fees of $7,500.00, in addition to the $5,000.00 for emotional distress and mental pain and suffering. The propriety of the award of attorney's fees is not an issue in this appeal.
[4] The judgment is silent as to the jury's verdict in favor of the Osbornes and against Pritchard for $2,677.50.
[5] Thereafter, Ladner filed a motion for new trial, contending that the judgment was contrary to the law and the evidence in the following respects: the trial court failed to give its jury instructions relative to mitigation of damages; some of the damages awarded to the Osbornes were for apparent defects; Ladner was not in bad faith, and Pritchard should have been held solidarily liable for the entirety of the judgment rendered against Ladner. Pritchard filed a motion to dismiss Ladner's motions for new trial, which was signed by the trial judge on December 12, 1995. These matters are not before us on appeal.
[6] Ladner does not contend on appeal that the trial court erred in finding that the home contained redhibitory defects or that the Osbornes were entitled to a reduction in the purchase price of the home. Rather, Ladner's appeal addresses the amount of the reduction and damages awarded to the Osbornes.
[7] See Footnote 4.
[8] According to the testimony of Joe Ed Arceneaux, the Terminix district sales manager for south Louisiana, a similar event occurred in the sale to Ladner. Terminix issued an initial report on July 24, 1989, noting that no active termite infestation had been observed. However, four days later, Terminix sent a second report noting the presence of active termite infestation.
[9] We note that the parties did not object to the verdict form, which failed to provide the jury with an opportunity to apportion fault between Ladner and Terminix. As such, any objections to the failure to include such an interrogatory is not before us on appeal. See Wiggins v. Exxon Corporation, 590 So. 2d 1209, 1210 (La.App. 1st Cir. 1991), writ denied, 595 So. 2d 660 (La.1992). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2417131/ | 30 F.Supp.2d 960 (1998)
Raymundo Cerrato SOLANO
v.
GULF KING 55, INC., Gulf King Services, Inc., and Gulf King 55, in Rem.
Civil Action No. G-98-095.
United States District Court, S.D. Texas, Galveston Division.
December 11, 1998.
Harold Joseph Eisenman, Attorney at Law, Houston, TX, Richard Lee Melancon, Melancon and Hogue, Friendswood, TX, Walter Z. Steinman, Attorney at Law, Bala Cynwyd, PA, for Raymundo Cerrato Solano, plaintiff.
Richard B. Waterhouse, Jr., Pipitone & Seger, Corpus Christi, TX, Daniel Douglas Pipitone, Pipitone and Seger, Houston, TX, for Gulf King 55, Inc., Gulf King Services, Inc., Gulf King 55 in Rem, defendants.
Ronald L. White, Brown Sims Wise & White, Houston, TX, for Ron White, movant.
ORDER DENYING DEFENDANTS' MOTION TO DISMISS AND MOTION FOR SUMMARY JUDGMENT
KENT, District Judge.
This is a personal injury case arising under the Jones Act, 46 U.S.C.App. § 688 et seq. and general maritime law. Plaintiff allegedly suffered an injury on February 23, 1995 while serving aboard the M/V GULF KING 55. He filed this claim against Defendants on February 19, 1998. Now before the *961 Court is Defendants' Motion to Dismiss or, in the alternative, Motion for Summary Judgment.[1] For the reasons set forth below, Defendants' Motion is DENIED.
I. FACTUAL SUMMARY
Defendants Gulf King 55, Inc. And Gulf King Services, Inc. ("Gulf King") are Texas corporations with their principal places of business in Aransas Pass, Texas. Both businesses are closely held corporations in which members of the owning family, who are American citizens and residents of Texas, own 96 percent of the stock. Defendants own forty-three shrimping vessels, thirty-four of which operate exclusively in the waters off the shore of Nicaragua. Together, these thirty-four vessels comprise what Defendants refer to as the "Nicaragua Fleet." Corporate officers in Defendants' Texas office make all decisions that concern the deployment or sale of any vessel in the Nicaragua Fleet. All operational and maintenance decisions regarding the fleet are made by a "fleet manager," a Nicaragua-based employee who is charged with running the fleet's day-to-day affairs but must consult with Defendants on all major decisions.[2]
The Nicaragua Fleet is the most profitable division owned by Defendants, which also maintain a fleet of shrimping vessels that operates in the waters off of Texas. From 1995 to 1997, the Nicaragua Fleet has generated profits of more than $1.6 million. These profits come entirely from sales in the United States of the shrimp caught in Nicaraguan waters. The shrimp are processed in Nicaragua by a Nicaraguan company called Oceanic, S.A., which receives a flat fee for its work.[3] The processed shrimp are then shipped to Miami, Florida, where Defendants maintain a refrigerated warehouse. From Miami, Defendants sell the shrimp exclusively to United States-based customers. The proceeds attributable to the shrimp produced by the Nicaragua Fleet end up commingled with the proceeds from Defendants' domestic operations.
Each of the vessels in the Nicaragua Fleet sails under the United States flag. According to the testimony of company officials, sailing under the U.S. flag is a condition imposed by Defendants' three primary financing creditors, the Department of Commerce, the National Marine Fishery Service, and the Small Business Administration. Together, those three government agencies have loaned Defendants approximately $2.3 million since 1980. The loans are secured through liens on individual ships in both the Nicaraguan and domestic fleets. To better secure their liens, the creditor agencies require that the ships sail under the U.S. flag and be documented in the United States.
The vessels are all entirely crewed by Nicaraguan citizens and captained for the most part by American citizens. The fleet manager hires a captain for each vessel, who then hires a crew for each shrimping voyage. At the conclusion of each voyage, the fleet manager faxes a payroll request based upon the particular vessel's catch to Defendants in Texas. Defendants then wire the payroll *962 funds to a Nicaraguan bank, where the money is converted into local currency and distributed to the crew.
In this case, Plaintiff is a Nicaraguan citizen who served aboard one of the vessels in Defendants' Nicaraguan Fleet, the M/V GULF KING 55, in February 1995. On February 23 of that year, he was assisting with a line that is used to raise the shrimping nets when the winch controlling the line allegedly reversed itself and sent the line paying out rapidly in the opposite direction. Plaintiff's hand was caught in the line and severely injured. He filed suit against Defendants in this Court on February 19, 1998.
II. ANALYSIS
The issue confronting this Court is the choice of law governing Plaintiff's claim. Defendants have moved the Court to dismiss Plaintiff's cause of action for failure to state a claim for which relief may be granted. In the alternative, Defendants ask the Court to find based on the summary judgment evidence before it that Nicaraguan law governs this dispute and dismiss all causes of action brought under the Jones Act and general maritime law under the doctrine of forum non conveniens. Each party has submitted evidence outside the pleadings. Consequently, the Court will treat this motion as a Motion for Summary Judgment.
Summary judgment is appropriate if no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. See Fed.R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). When a motion for summary judgment is made, the nonmoving party must set forth specific facts showing that there is a genuine issue for trial. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). Issues of material fact are "genuine" only if they require resolution by a trier of fact. See id. at 248, 106 S.Ct. at 2510. The mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. Only disputes over facts that might affect the outcome of the lawsuit under governing law will preclude the entry of summary judgment. See id. at 247-48, 106 S.Ct. at 2510. If the evidence is such that a reasonable fact-finder could find in favor of the nonmoving party, summary judgment should not be granted. See id.; see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986); Dixon v. State Farm Fire & Casualty Co., 799 F.Supp. 691 (S.D.Tex.1992)(noting that summary judgment is inappropriate if the evidence could lead to different factual findings and conclusions). Determining credibility, weighing evidence, and drawing reasonable inferences are left to the trier of fact. See Anderson, 477 U.S. at 255, 106 S.Ct. at 2513.
The question of whether United States or foreign law applies to a maritime injury case is governed by the Supreme Court trilogy of Lauritzen v. Larsen, 345 U.S. 571, 73 S.Ct. 921, 97 L.Ed. 1254 (1953); Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959); and Hellenic Lines Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970). Under these cases, the following eight factors determine the choice of law: (1) the allegiance or domicile of the plaintiff; (2) the place of the contract; (3) the allegiance of the defendant shipowner; (4) the law of the flag; (5) the accessibility of the foreign forum; (6) the place of the wrongful act; (7) the law of the forum; and (8) the defendant shipowner's base of operations. These factors, while potentially suggestive of a mechanical approach to determining choice of law, are not all of equal or even comparable significance. See Rhoditis, 398 U.S. at 308-09, 90 S.Ct. at 1733-34; Schexnider v. McDermott International, Inc., 817 F.2d 1159, 1161 (5th Cir.1987); Munusamy v. McClelland Engineers, Inc., 579 F.Supp. 149, 152-53 (E.D.Tex.1984). Generally, the law of the flag and the defendant shipowner's base of operations weigh most heavily in the determination. See Lauritzen, 345 U.S. at 583, 73 S.Ct. at 929 (stating that the law of the flag is of "cardinal importance" in determining applicable law); Rhoditis, 398 U.S. at 309-10, 90 S.Ct. at 1734-35 (holding that the defendant's New York base of operations *963 favored United States law despite the ship's Greek flag). On the other hand, the place of the wrongful act, the inaccessibility of a foreign forum, and the law of the forum are seldom relevant to the determination. See Sablic v. Armada Shipping Aps, 973 F.Supp. 745, 750-51 (S.D.Tex.1997) (citing Lauritzen, 345 U.S. at 583, 73 S.Ct. at 928) (stating that the place of the wrongful act carries little weight in shipboard torts because of the numerous jurisdictions through which vessels typically pass); Munusamy, 579 F.Supp. at 153 (noting that inaccessibility of a foreign forum and the law of the forum are irrelevant). Moreover, each of the factors may be substantial in one context but insignificant in another. See Chiazor v. Transworld Drilling Co., 648 F.2d 1015, 1018 (5th Cir.1981). The national interests to be served by application of United States law may also influence the weight to be assigned each factor. See Schexnider, 817 F.2d at 1161 (citing Rhoditis, 398 U.S. at 308-09, 90 S.Ct. at 1733-34).
In the present case, the law of the flag is undisputedly that of the United States. The M/V GULF KING 55 was flying the U.S. flag at the time of the accident. Defendants were required to sail under the U.S. flag as a condition of the loans they had received from three government agencies. In addition, Defendants themselves benefited by flying the U.S. flag. As one officer testified, U.S. registration would have protected the vessels of the Nicaragua Fleet in the event that the Nicaraguan government had tried to nationalize any of them, as it had done with other shrimping vessels during periods of political instability. While each of these vessels in the Nicaragua Fleet flew a Nicaraguan flag as well, Plaintiff has offered testimony from a corporate officer that those flags merely served as an indication that the vessels were authorized to fish in Nicaraguan territorial waters. The flag was not a sign of Nicaraguan ownership or registration. The law of the flag clearly favors application of American law.
Defendants argue that the base of operations of the vessel involved in this accident provides a counterweight to the law of the flag. The vessel, like all of those vessels in the Nicaragua Fleet, was permanently stationed in Nicaragua and plied its trade in Nicaraguan waters, departing from and returning to Nicaraguan ports at all times. In some circumstances, this would result in the base of operations factor favoring Nicaraguan law. See, e.g., Quintero v. Klaveness Ship Lines, 914 F.2d 717, 723 (5th Cir.1990); Bailey v. Dolphin International, Inc., 697 F.2d 1268, 1275 n. 22 (5th Cir.1983), overruled on other grounds, In re Air Crash Disaster Near New Orleans, La., 821 F.2d 1147 (5th Cir.1987). However, the Court is not convinced that the real base of operations is in Nicaragua. See Rhoditis, 398 U.S. at 310, 90 S.Ct. at 1734-35 (warning that "the facade of the operation must be considered as minor, compared with the real nature of the operation and a cold objective look at the actual operational contacts that this ship and this owner have with the United States."). Although the vessel's day-to-day operations fell under the supervision of its captains and the Nicaragua-based fleet manager, numerous connections link the entire Nicaragua Fleet to Defendants' headquarters in Aransas Pass, Texas. First, the fleet manager must consult with Defendants on all major decisions, and Defendants make all decisions concerning the deployment or sale of a particular vessel at their Texas headquarters. Second, all shrimp caught by these vessels are shipped to Miami for sale in the United States, the proceeds of which are commingled with those from the sales traceable to Defendants' domestic operations. Finally, the vessel is entirely owned by Defendants, a pair of closely held Delaware corporations which have Texas as their principal place of business. One Texas family holds 96 percent of the stock of these corporations. Together, these connections lead to the conclusion that Defendants' true base of operations is in the United States. Although day-to-day operations are the touchstone for the base of operations analysis in this Circuit, see Bailey, 697 F.2d at 1275 n. 22, the fact that the fleet manager required corporate approval for any major day-to-day decisions mitigates against concluding that Nicaragua was Defendants' base. Consequently, the base of operations favors application of U.S. law.
*964 Similarly, the allegiance of Defendants supports application of American law. Defendants are two Delaware corporations who operate principally from their corporate headquarters in Texas. In addition, their stock is almost entirely controlled by two members of the owning family.
Two factors favor application of Nicaraguan law. First, Plaintiff is a Nicaraguan citizen who maintains his residence in that country. Second, the place of the employment contract entered into between Plaintiff and Defendants was Nicaragua. The remaining factors the place of the alleged wrong, the accessibility of Nicaragua as a forum, and the law of this forum are not relevant to the determination.
The scorecard of factors, so to speak, thus favors the applicability of American law, with the two most significant factors both supporting that conclusion. The application of these factors is not a mechanical test, of course; the Court is instructed by the controlling precedent to consider the national interests to be served by the choice of American law. See Schexnider, 817 F.2d at 1161 (citing Rhoditis, 398 U.S. at 308-09, 90 S.Ct. at 1733-34); Castillo v. Santa Fe Shipping Corp., 827 F.Supp. 1269, 1271 (S.D.Tex. 1992). The Court concludes that applying the Jones Act and general maritime law to this dispute would serve at least one interest. Defendants are two profitable companies that derive most of their profits from their Nicaraguan operation. This is in part because Defendants realize a substantial savings due to the lower wages received by the Nicaraguan seamen they employ. The Court has little doubt that any potential recovery to which these Plaintiffs may be entitled in Nicaragua would be significantly lower than that they might receive under the Jones Act. Humane considerations aside, the Court does not need to provide further incentive for corporations like these Defendants to employ foreign nationals in their fishing operations to the exclusion of higher-paid American seamen. Defendants have already received the benefit of their bargain in the form of lower wage obligations and the resulting greater profits; allowing them to escape the obligations of the Jones Act while maintaining such extensive control over the operation of the Nicaragua Fleet vessels such as M/V GULF KING 55 would be a windfall and smacks of manifest exploitation of third-world employees who are least in a position to defend themselves. In addition, the Court notes that Plaintiff and the other Nicaraguan seamen who are employed by Defendants confer a greater economic benefit upon Defendants than do the American seamen Defendants employ in domestic waters. This only underscores the dictate that the control exercised by Defendants over these foreign seamen confers a correlative duty upon them to make commensurate provisions for their welfare. Accordingly, the Court holds that American law, specifically the Jones Act and the general maritime law, governs this action.[4] Defendants's Motion for Dismissal, and, in the alternative, Summary Judgment is therefore DENIED.
III. CONCLUSION
The Court finds as a matter of law that the Jones Act and the general maritime law of the United States governs Plaintiff's claim. This case will be set for trial at a later date. Without commenting on the merits of the claim or defenses asserted, this Court will examine them again at that time.
For the reasons set forth above, Defendants' Motion to Dismiss for Failure to State a Claim or, in the alternative, for Summary Judgment is DENIED. The parties are ORDERED to bear their own taxable costs and expenses incurred herein to date.
IT IS SO ORDERED.
NOTES
[1] The factual and legal issues concerning choice of law in this case are substantially identical to those in the case before this Court styled Victor Manuel Urbina v. Gulf King 55, Inc. and Gulf King Services, Inc. and GULF KING 49 in rem, Civil Action No. G-98-143. In that case, the only difference is the identity of the Plaintiff, a Nicaraguan seaman who was injured on a different vessel belonging to Defendants. Accordingly, the Court has issued a substantially similar order in that case addressing the choice of law question raised by Defendants.
[2] Defendants have employed five different fleet managers since they began their operations in Nicaragua. Three of the fleet managers have been American citizens, while two have been Nicaraguan citizens. The current fleet manager is an American.
[3] When Defendants launched their shrimping operations in Nicaragua, they entered into an agreement with Oceanic through which Oceanic would process all of the shrimp caught and assist Defendants' American ship captains and fleet managers in identifying qualified Nicaraguan seamen and processing payroll requests at the completion of each voyage. Upon receipt of the payroll requests prepared by Oceanic, Defendants would wire the requested funds to Oceanic's Nicaraguan bank account. Oceanic would then pay the seamen. At the same time, Defendants agreed to purchase 50% of Oceanic's stock for the price of $1.1 million. In 1996, Defendants assumed control over all aspects of the shrimping operations, relieving Oceanic of all duties except for processing.
[4] Because United States law governs Plaintiff's claim, the Court need not consider Defendants' arguments in favor of forum non conveniens dismissal. See Schexnider, 817 F.2d at 1161 ("First the court determines that United States law does not apply, and then the court balances public and private convenience factors set forth in judicial precedent to determine whether to dismiss the case [on grounds of forum non conveniens]"). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1574115/ | 694 S.W.2d 391 (1985)
Anna Mae JACK d/b/a Ann Jack Real Estate and Medina Lake Recreation Park, Inc., Appellants,
v.
The STATE of Texas and the Texas Parks and Wildlife Department, Appellees.
No. 04-83-00432-CV.
Court of Appeals of Texas, San Antonio.
May 15, 1985.
Rehearing Denied June 28, 1985.
*393 Paul B. Keller, San Antonio, for appellants.
Eva King Koutzenhiser, Asst. Atty. Gen., Austin, for appellees.
Before ESQUIVEL, TIJERINA and DIAL, JJ.
*394 OPINION
ESQUIVEL, Justice.
This is an appeal from a judgment in a suit for declaratory judgment and injunctive relief. We affirm.
On October 19, 1971, Bandera County, acting through its then Commissioner's Court and its then County Judge W.O. Hatfield, Jr., leased a 7.248 acre tract of land to appellees, the State of Texas, acting through its Parks and Wildlife Department, for an initial term of twenty-five (25) years for the purpose of appellees constructing, maintaining and operating a public boat ramp and parking area facilities. Subsequently and in furtherance of the lease agreement, appellees entered into an annual "services agreement" with Bandera County wherein appellees agreed to pay Bandera County the sum of $100.00 per quarter for "operation expenses." The last of such "service agreements" was entered into on August 18, 1978, and it is undisputed that appellees paid Bandera County $100.00 per quarter for "operation expenses" from May 31, 1977, through and ending May 31, 1979.
On December 11, 1978, Bandera County, acting through its then Commissioner's Court and its then County Judge, W.O. Hatfield, Jr., entered into a contract with appellant Anna Mae Jack, doing business as Ann Jack Real Estate. Bandera County agreed to lease the tract in question to appellant Jack for a period of twenty years and appellant Jack agreed to construct and operate a recreational area and erect necessary utilities and sanitary facilities for the use and enjoyment of the general public of said tract of land in question and to pay Bandera County one-half of one percent of the gross receipts received by her from the operation and ownership of the leased real estate. On April 9, 1979, an amendment to this contract was executed by Bandera County, acting through its then Commissioner's Court and its then County Judge, Rein J. Vander Zee, to include additional tracts of real property not the subject of this litigation and to require appellant Jack to obtain and maintain liability insurance for the premises. On April 9, 1979, Bandera County, by and through its then Commissioner's Court and its then County Judge, Rein J. Vander Zee, consented in writing to the assignment of appellant Jack's contract to appellant Medina Lake Recreation Park, Inc., by appellant Jack.
Appellants commenced charging a park entrance fee and since the park entrance was the only access to appellees' public boat launching ramp and public parking facilities, the public was in fact paying a fee for access to and use of appellees' boat launching ramp. Appellees insisted on a free access boat launching ramp and sued appellants seeking a declaration that appellants and Bandera County may not interfere with its lease of the tract in question and for an injunction restraining appellants from charging fees to use the park for launching boats and from otherwise interfering with appellees' use of the tract in question as a place for the public to park and launch a boat without paying a fee. Appellants answered by way of general denial and specifically alleged abandonment, termination of the lease, and failure of consideration. Appellants also filed a cross-action against Bandera County seeking damages for construction of improvements, employees' salaries, loss of revenue and attorney's fees against Bandera County based on fraud, equity and breach of contract.
On March 30, 1981, appellees' motion for summary judgment was denied. In its order, dated October 1, 1981, denying appellees' motion for summary judgment the court found, pursuant to TEX.R.CIV.P. 166-A(d), the following material facts existed without controversy: (1) Bandera County did not comply with TEX.REV.CIV. STAT.ANN. art. 1577 (Vernon Supp.1985), in entering into the contract with appellant Jack; and (2) if the contract with appellant Jack is unenforceable because of Bandera County's failure to comply with article 1577, such lease contract was not and cannot be ratified by Bandera County. The court found that the following material facts were actually and in good faith controverted: *395 (1) whether appellees abandoned their lease with Bandera County; and (2) whether the contract between Bandera County and appellant Jack pertaining to the 7.248 acre tract of land in question provided for a lease of Bandera County's property. Appellants timely filed their objections to the findings of the trial court but the record before us does not show that their motion was ever presented to or acted upon by the trial court.
On April 11, 1983, in a bench trial on appellees' first amended original petition and appellants' first amended answer and cross-action, the court found that appellees were entitled to exclusive possession of the 7.248 acre tract of land in question and entered judgment in favor of appellees enjoining appellants from in any manner interfering with appellees' right to exclusive possession and control of the 7.248 acre tract of land in question; the court also entered a take nothing judgment in favor of Bandera County in appellants' cross-action against Bandera County.
The trial court filed the following findings of fact and conclusions of law:
I. FINDINGS OF FACT
A. The contract between Defendant County and Defendant Jack dated the 11th day of December, 1978 provided for and effected a grant of an estate in land for a term of years by Defendant County to Defendant Jack and vested Defendant Jack with the right to exclusive possession of the premises.
B. Defendant County failed to comply with the requirements of Article 1577, V.A.C.S., in entering into the contract with Defendant Jack dated the 11th day of December, 1978. (See Order on Plaintiff's Motion for Summary Judgment dated October 1, 1981).
II. CONCLUSIONS OF LAW
A. The contract between Defendant County and Defendant Jack dated the 11th day of December, 1978 constitutes a lease of Defendant County's real property to Defendant Jack. [Citations omitted.]
B. Because of Defendant County's failure to comply with the requirements of Article 1577, V.A.C.S., in entering into such lease with Defendant Jack, the same is void. [Citations omitted.]
C. Being illegal and void, such lease by Defendant County to Defendant Jack could not be ratified by Defendant County, [citations omitted], and Defendant Medina Lake Recreation Park, Inc., acquired nothing under the assignment of same by Defendant Jack. [Citations omitted.]
D. There is no evidence that plaintiffs abandoned their lease dated the 19th day of October, 1971 with Defendant County. [Citations omitted.]
E. If the lease between Plaintiffs and Defendant County dated the 19th day of October, 1971, creates a tenancy at will, there is no evidence that Defendant County terminated the same. [Citations omitted.]
F. If the lease between Plaintiffs and Defendant County dated the 19th day of October, 1971, creates a tenancy at will, there is no evidence that Plaintiffs terminated the same. [Citations omitted.]
G. Defendant County breached its lease to Plaintiffs by leasing the premises to Defendant Jack during the rental period and permitting Defendant Jack to take possession and control of the premises. [Citations omitted.]
H. If Plaintiffs' failure to enter into and make payments under Services Agreements subsequent to 1978 constituted a breach by Plaintiffs of their lease with Defendant County, such breach is excused by Defendant County's breach in leasing the premises to Defendant Jack on the 11th day of December, 1978. [Citations omitted.]
I. If Plaintiffs' failure to enter into and make payments under Services Agreements subsequent to 1978 constituted a breach by Plaintiffs of their lease with Defendant County, there is no evidence that Defendant County made demand *396 upon Plaintiffs to execute and perform Services Agreements subsequent to 1978, and, consequently, Defendant County was not entitled to forfeit its lease with Plaintiffs because of such breach. [Citations omitted.]
J. Because the lease by Defendant County to Defendant Jack was entered into in violation of article 1577, V.A.C.S., the same is illegal and unenforceable by Defendant Jack and her assignee Defendant Medina Lake Recreation Park, Inc. [Citations omitted.]
In this appeal, appellants present us with nine points of error, all of which complain of the court's findings of fact and conclusions of law with the exception of findings of fact "A" declaring that the contract between Bandera County and appellant Jack granted an estate in appellant Jack for a term of years and vested appellant Jack with the right to exclusive possession of the tract of land in question.
The trial court concluded that the lease between Bandera County and appellant Jack was void, could not be ratified and was unenforceable by appellant Medina Lake Recreation Park, Inc., because it was illegal. Appellants assert, and correctly so, that these conclusions are predicated upon the trial court's finding of fact "B", i.e., that Bandera County failed to comply with the requirements of article 1577. Appellants contend in point of error number four that there is no evidence in the record to support such a finding. We disagree with appellants.
As stated earlier in this opinion, the order of the trial court denying appellees' motion for summary judgment recites, among other things, that the trial court found, pursuant to TEX.R.CIV.P. 166-A(d), that it was undisputed that Bandera County did not comply with the requirements of article 1577 in entering into the contract with appellant Jack. The record reflects that appellants objected to this finding by a timely filed motion but there is nothing in the record to indicate that this motion was ever presented to or acted upon by the trial court. Rule 166-A(d) clearly states, "[u]pon the trial of the action the facts so specified shall be deemed established, and the trial shall be conducted accordingly...." Therefore, appellants' failure to obtain a ruling on their exception to such findings, established such findings as if they were stipulations agreed to by all parties which required no extrinsic evidence at trial. Appellants' point of error four is without merit and is overruled.
Having found that there is evidence of probative force to uphold the court's finding of Bandera County's non-compliance with article 1577 in the execution of its contract with appellant Jack, we now turn to the issues raised by appellants' points of error numbers one, two, and three, i.e., whether the contract is void, whether it could be ratified by Bandera County and whether it was enforceable by the assignee, appellant Medina Lake Recreation Park, Inc. First, however, we must determine whether the contract between Bandera County and appellant Jack is a "lease."
It is well settled that a trial court's findings of fact which are not challenged by any of appellants' points of error constitute undisputed facts and are conclusive and binding on appellants as well as this court. Whitten v. Alling & Cory Co., 526 S.W.2d 245, 248 (Tex.Civ.App.Tyler 1975, writ ref'd); Curtis v. National Cash Register Co., 429 S.W.2d 909, 911 (Tex.Civ. App.Amarillo 1968, writ ref'd n.r.e.). In this appeal, appellants have failed to challenge in any manner finding of fact "A" of the trial court. Accordingly, we must determine whether the contract between Bandera County and appellant Jack is a "lease" bound solely by the unchallenged findings that "[t]he contract ... provided for and effected a grant of an estate in land for a term of years by Defendant County to Defendant Jack and vested Defendant Jack with the right to exclusive possession of the premises." Based on these facts we conclude that it is a "lease." A "lease" is a grant or devise of realty, usually for a term of years, and must be executed in the essential prerequisites of a deed. Scroggins v. Roper, 548 S.W.2d 779, *397 780 (Tex.Civ.App.Tyler 1977, writ ref'd n.r.e.); Caples v. Dearborn Stove Co., 231 S.W.2d 669, 673 (Tex.Civ.App.Dallas 1950), reversed on other grounds, 149 Tex. 563, 236 S.W.2d 486 (1951). Accordingly, we hold that the trial court correctly concluded that as a matter of law the contract between Bandera County and appellant Jack dated December 11, 1978, constitutes a lease of Bandera County's real property to appellant Jack.
We will now address the issues of voidness, ratification and assignment.
It is well settled that a county can act only through its Commissioner's Court and the authority of the Commissioner's Court as the governing body of the county to make contracts in behalf of the county is limited to that conferred either expressly or by necessary implication by the constitution and laws of this state. Childress County v. State, 127 Tex. 343, 352, 92 S.W.2d 1011, 1016 (1936); Wilson v. County of Calhoun, 489 S.W.2d 393, 397 (Tex. Civ.App.Corpus Christi 1972, writ ref'd n.r.e.). The manner by which a county can convey land to an individual is prescribed by article 1577. Wilson, 489 S.W.2d at 397. Under the provisions of article 1577, the Commissioner's Court may appoint a commissioner to sell or lease any real estate owned by the county at public auction; notice of such sale or lease must be advertised by publication at least twenty days before the date of sale or lease, once a week for three consecutive weeks, in a newspaper in the county where the real estate is located and in the county owning the real estate if the two are not the same. Although article 1577 is merely permissive in its terms, its provisions form the only mode by which a county can dispose of its real property, Ferguson v. Halsell, 47 Tex. 421, 422 (1877), and a conveyance of land made by a county in any mode other than that prescribed by statute is void. Wilson, 489 S.W.2d at 397. Having determined that the contract between Bandera County and appellant Jack is a "lease" and that Bandera County did not comply with the provisions of article 1577, we hold that the trial court was correct in its conclusion of law "B" that the same is void.
Ratification may not be used to justify the making of an illegal contract. A contract which is made in violation of a statute is illegal and void and therefore not subject to ratification. Mayfield v. Troutman, 613 S.W.2d 339, 344 (Tex.Civ.App. Tyler 1981, writ ref'd n.r.e.). We, therefore, further hold that the trial court did not err in concluding in its conclusion of law "C" that the void and illegal lease between Bandera County and appellant Jack could not be ratified by Bandera County and in its conclusion of law "J" that the contract between Bandera County and appellant Jack not being in compliance with article 1577 is illegal and unenforceable by appellant Jack and its assignee appellant Medina Lake Recreation Park, Inc.
The law presumes that appellant Jack knew the contract with Bandera County was in violation of the law. It follows that appellant Medina Lake Recreation Park, Inc., acquired no other or higher right therein than its assignor, appellant Jack. See Bruder v. State, 601 S.W.2d 102, 103 (Tex.Civ.App.Dallas 1980, writ ref'd n.r.e.), cert. denied, 452 U.S. 940, 101 S.Ct. 3084, 69 L.Ed.2d 954 (1981); Beavers v. Consolidated Oil Co. of Texas, 31 S.W.2d 876, 878 (Tex.Civ.App.Amarillo 1930, writ dism'd). Accordingly, we hold that the trial court was correct in its conclusion of law "C" that appellant Medina Lake Recreation Park, Inc., acquired nothing under the assignment of the lease contract by appellant Jack. Appellants' points of error one, two and three are overruled.
In its conclusion of law "D" the trial court concluded that there is no evidence that appellees abandoned their lease with Bandera County. Appellants contend in point of error number five that the evidence clearly establishes the contrary as a matter of law. We disagree with appellants.
Appellants argue that the appellees abandoned and breached their lease with Bandera County because appellees refused *398 to correct problems of people congregating on the boat ramp and vandalism at the boat ramp; that appellees' insistence on a free access boat launching ramp, created an impossible situation for Bandera County. We cannot conclude that this is sufficient evidence that appellees abandoned or breached the lease with Bandera County to maintain and operate the boat ramp as provided by the lease agreement. The undisputed testimony of Judge Hatfield clearly established that appellees were in compliance with the terms of the lease. Additionally, Judge Hatfield testified that Bandera County never made a demand on appellees about these matters. A review of the lease clearly shows that it does not contain an express waiver of demand. Accordingly, Bandera County could not terminate the lease for breach of covenant without first making a demand upon appellees for performance. See McVea v. Verkins, 587 S.W.2d 526, 531 (Tex.Civ.App.Corpus Christi 1979, no writ).
In point of error number six, appellants complain of the court's conclusion of law "G" that Bandera County breached its lease with appellees by leasing the premises to appellant Jack. Appellants contend that Bandera County, in entering into the lease contract with appellant Jack, relied on assertions by appellees' employee, T.M. Beall, that Bandera County could allow a concessionaire on the park premises and that an entrance fee could be charged for the use of improvements; that Bandera County further relied on the "services agreement" which provided that Bandera County could subcontract for such services and obligations as necessary.
In regard to appellees' employee consenting to a concessionaire, there is no evidence that it was in writing and that the employee had the authority to forfeit the lease. The mere consent to a concessionaire cannot be concluded to be sufficient to forfeit the lease between appellees and Bandera County.
In regard to the "services agreement" and the provisions therein, we cannot conclude that Bandera County's exercise of its authority under said agreement to subcontract maintenance services when necessary to be permission or authority for Bandera County to relet the premises to appellant Jack while the original lease between Bandera County and appellees still was in effect. It is noted that these two incidents occurred months after Bandera County wrongfully leased the same premises to appellant Jack.
The leasing of the premises to appellant Jack and the entry thereon by appellant Jack during the original lease term of appellees lease constituted a breach by Bandera County of that implied covenant of quiet possession and enjoyment by appellees under their lease with Bandera County. Whether a lease contract has been breached is a question of law. Frazier v. Wynn, 459 S.W.2d 895, 897 (Tex.Civ.App.Amarillo 1970), reversed on other grounds, 472 S.W.2d 750 (Tex.1971). We, therefore, conclude that the trial court was correct in its conclusion of law "G" that Bandera County breached its lease to appellees by leasing the premises to appellant Jack during the original rental period and permitting appellant Jack to take possession and control of the premises. See id.
Another argument presented by appellant Jack is her contention that appellees' lease was terminated by either appellees or Bandera County because appellees ceased payments under the "services agreement," and because Bandera County refused to enter into a subsequent "services agreement."
We note from the record that these two incidents occurred after the lease between Bandera County and appellant Jack was executed, which lease we have held to be void and which lease we have held to be a breach by Bandera County of its lease with appellees. It is fundamental that when one party to a contract repudiates or commits a material breach of that contract, the other party is discharged or excused from his obligation to perform. Mead v. Johnson Group, Inc., 615 S.W.2d *399 685, 689 (Tex.1981); Glass v. Anderson, 596 S.W.2d 507, 511 (Tex.1980); Corso v. Carr, 634 S.W.2d 804, 808 (Tex.App.Fort Worth 1982, writ ref'd n.r.e.). Accordingly, appellees' failure to continue payments under the "services agreement" was excusable and cannot be considered as a termination or breach of the lease with Bandera County. Bandera County's refusal to provide a subsequent service agreement had nothing to do with Bandera County's capacity as lessor under the lease agreement with appellees. Bandera County did not act in its capacity as lessor under the "services agreement," it merely acted as a contractor for services with appellees. Therefore, we hold that Bandera County's refusal to enter into subsequent "services agreements" with appellees is not a termination of their lease. Appellants' points of error five, six, eight and nine are overruled.
Appellants' point of error seven is directed to the trial court's conclusions "E" and "F" which concern the lack of termination of the lease between Bandera County and appellees if the lease is a tenancy at will. We conclude that under the terms of the lease it is not a tenancy at will as it was not terminable by either party at will. Accordingly, appellants' point of error number seven is overruled.
The judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1609280/ | 270 F.Supp. 1 (1967)
Carmen TORRES, as guardian for and on behalf of Néstor, Lucía and Luis Torres, Minors, Plaintiffs,
v.
John W. GARDNER, Secretary of Health, Education and Welfare, Defendant.
Civ. No. 454-66.
United States District Court D. Puerto Rico.
June 28, 1967.
*2 Jose Guillermo Vivas, Jorge Lucas Valdivieso, Jr., Ponce, P. R., for plaintiffs.
Candita R. Orlandi, Asst. U. S. Atty., for defendant.
MEMORANDUM OF OPINION
CANCIO, Chief Judge.
This is an action under section 205(g) of the Social Security Act, 42 U.S.C.A. § 405(g), to review a final decision of the Secretary of Health, Education and Welfare, which is that of the Appeals Council rendered on July 25, 1966 modifying the one of the Hearing Examiner rendered on March 28, 1966. This final decision holds that the minor plaintiffs are not entitled to child's insurance benefits prior to the month of September 1965, for which application was filed on August 2, 1962.
There are no questions of fact involved in this appeal. Therefore, it is not a matter of whether the Secretary's decision is supported by substantial evidence, but, rather, whether in the light of the uncontroverted facts, it is correct in interpreting the law of Puerto Rico. A short compendium of the facts is necessary, though, for a better understanding of the case at bar.
The decedent in this case, Néstor Luis Torres, was born on January 7, 1934 and died on July 28, 1962. Sometime in 1951 he began living as man and wife with one Hilda Iris Delgado. This relation continued until her death on October 9, 1958. At some time prior to entering upon the aforesaid relationship, Hilda Iris Delgado has been legally married to one Blas Viuda Méndez and this marriage was never terminated by divorce. Néstor Luis Torres and Hilda Iris Delgado procreated three children between them: Néstor L. Torres Delgado and Lucía C. Torres Delgado (twins, born on July 6, 1952), and Luis E. Torres Delgado (born on September 6, 1955). All three of these children were registered with the Department of Health (Demographic Division) within three days of their birth by their biological father, Luis Torres, as his natural children. Paternity over these children has never been questioned. In fact, the legal husband of their mother has denied any paternity. Finally, on February 27, 1963, the Superior Court of Puerto Rico, Ponce Part, upon petition of Carmen Torres, guardian of the minors, entered a declaration of heirship wherein it was found that these minor children were the sole heirs of Mr. Néstor Luis Torres, deceased.
There is no dispute as to the facts nor is there any dispute as to the evidence adduced. As stated above, the sole question before this Court is whether or not the Secretary of Health, Education and Welfare erred in his application of the law to the facts as presented.
The Hearing Examiner came to the following decision:
* * * under the applicable law, the children Néstor, Lucía del Carmen and Luis E. were and are entitled to inherit as children of the Wage Earner Néstor Luis Torres under the intestate laws of Puerto Rico. Therefore, it is the decision of the Hearing Examiner that the aforementioned children do have the status of children of the Wage Earner under the Social Security Act and are entitled to child's insurance benefits on the wage record of Néstor Luis Torres. (Tr. 15)
The Appeals Council did not entirely agree with the Hearing Examiner and modified his decision as follows:
* * * it is the finding of the Appeals Council that Néstor, Lucía and Luis Torres were not children of the Wage Earner having the same inheritance rights under Puerto Rican Law as legitimate children and consequently, *3 not children within the meaning of section 216(h) (2) (A) of the Act. However, the evidence of record does establish, and the Appeals Council finds, that the Wage Earner acknowledged in writing that he was the father of the children and that they are deemed to be his children under section 216(h) (3) (C) of the Act, as amended in 1965 by Public Law 89-97. The Council further finds that the application filed in the children's behalf under section 202(j) (2) of the Act, is deemed to have been filed on September 1, 1965, the first day of the month in which all requirements for entitlement to child's insurance benefits were first met.
It is the decision of the Appeals Council that Néstor, Lucía and Luis Torres are entitled to child's insurance benefits on the earnings record of the deceased wage earner, beginning with the month of September 1965. The decision of the Hearing Examiner is modified accordingly. (Tr. 5)
In questions such as these, the laws of the United States refer the matter to the laws of the several states, and the Secretary of Health, Education and Welfare must make his determinations according to those laws. Thus, under 42 U.S.C. § 416(h) (2) (A):
In determining whether an applicant is the child or parent of a fully or currently insured individual for purposes of this subchapter, the Secretary shall apply such law as would be applied in determining the devolution of intestate personal property by the courts of the State in which such insured individual is domiciled at the time such applicant files application, or, if such insured individual is dead, by the Courts of the State in which he was domiciled at the time of his death, or, if such insured individual is or was not so domiciled in any State, by the courts of the District of Columbia. Applicants who according to such law would have the same status relative to taking intestate personal property as a child or parent shall be deemed such.
The question before this Court is, then, whether under the law of Puerto Rico, adulterine children, recognized by their biological father, can inherit from him the same as any legitimate or natural child. We find that they can.
In order to come to this conclusion, we must now turn to examine several questions of law which the findings of the Appeals Council have raised:
1. Can the paternity of children born within a marital relationship be questioned; and, if so, how.
2. Can children born out of an adulterous relationship be recognized by their parents; and, if so, what is the extent of the rights of inheritance of such children regarding their biological parents.
3. Does the case of Ocasio v. Díaz, D.S.C.P.R. of June 27, 1963, 1963 Colegio de Abogados 119, ___ P.R.R. ___, apply to the case at bar.
Article 113 of the Civil Code of Puerto Rico, 31 L.P.R.A. § 461, states as follows:
Legitimate children are those born 180 days after the marriage has been celebrated and before 300 days have passed after the marriage has been dissolved. Against legitimacy no other proof shall be admitted than the physical impossibility of the husband to use his wife within the first one hundred and twenty days of the three hundred days that have preceded the the birth of the child.
It is clear that the Code creates a presumption of legitimacy designed to protect the child and his mother from a challenge of bastardy. Yet, at the very same time, the Code creates the manner in which this very presumption may be controverted and rejected.
On the other hand, Article 116 of the Civil Code of Puerto Rico, 31 L.P.R.A. § 464, establishes the persons who may controvert or dispute an apparent legitimacy:
Legitimacy can only be disputed by the husband or his legitimate heirs. The *4 latter can only contest the legitimacy of a child in the following cases:
1. If the husband has died before the termination of the period fixed for instituting his action in court.
2. If he shall have died after presenting his action without having desisted from it.
3. If the child was born after the death of the husband.
Whether or not the procedure required by law was followed in obtaining a declaration that the children in question were not the legitimate children born of the marital union alleged, the Superior Court of Puerto Rico, Ponce Part, decided through Judge Ruíz Somohano that the children in question "were conceived and born of the union that existed between Néstor Luis Torres and * * * Hilda Iris Delgado Santiago." (Tr. 65) A copy of this judicial decision was before the Hearing Examiner and the Appeals Council.
It matters not at all whether the Appeals Council understands that the Court erred in applying the law of Puerto Rico. Certainly, the Superior Court of Puerto Rico is in a better position to apply the law of Puerto Rico and determine the filiation of the parties than is the Appeals Council. Moreover, this is clearly their trust under the law. Furthermore, in the face of this judicial decision on the filiation of the minors in question, the Courts of the United States are bound to give full faith and credit to the judicial decisions of the Courts of Puerto Rico. Americana of Puerto Rico, Inc. v. Kaplus, 368 F.2d 431 (3d Cir., 1966). The Administrative agencies of the United States are no less bound that the courts of the United States to give full faith and credit to the decisions of the Courts of Puerto Rico.
It is clear from the evidence, which is not contested at any time, that the paternity of the legal father as against the biological father was decided by the Superior Court of Puerto Rico in favor of the biological father. This is res judicata as far as the case at bar is concerned.
The next point to be looked into is whether or not adulterine children can be recognized as natural children. Act No. 229 of May 12, 1942, 31 L.P.R.A. § 501, states:
All children born out of wedlock subsequent to the date this Act takes effect, shall be natural children, whether or not the parents could have married at the moment when such children were conceived. * * *
This Act, by itself, is sufficient to allow the Court to state that adulterine children born after 1942 are the natural children of the parents recognizing them as such whether or not those parents are living in an adulterine concubinage. Moreover, the Constitution of the Commonwealth of Puerto Rico very clearly states that all men are equal before the Law and that no person shall be discriminated against because of his birth. Constitution, Article II, Section 1. Such discrimination is abhorrent to the principles of Justice.
In the case at bar, the evidence clearly establishes that the children in question were registered with the proper authorities as the natural children of Néstor Luis Torres and Hilda Iris Delgado. (Tr. 46-51). Thus we are now in the following situation. Under the law applicable to this case, we have three natural children recognized as such by their natural parents and by the competent Courts of the Commonwealth of Puerto Rico. The question then arises whether under the laws of the Commonwealth such children can inherit from their natural parents.
Act No. 17, of August 20, 1952, 31 L.P.R.A. § 441, states:
All children have, with respect to their parents and to the estate left by the latter, the same rights that correspond to legitimate children.
*5 It is in the interpretation of this Act that the case of Ocasio v. Díaz, supra, is very much in point.
Under the laws and the Constitution of the Commonwealth of Puerto Rico, there can be no question that, as far as their parents are concerned, all children, whether born in or out of wedlock, have the same inheritance rights. Now, the question might be raised whether this right accrues only to children born after 1952, or whether it also applies to children born prior to that year.
The Supreme Court of Puerto Rico has answered that question for us if but indirectly in the Ocasio case. Among the eight cases that are jointly decided in that opinion, there are several where the party seeking redress was born prior to 1952, but filed his case after that year.
It is the interpretation of this Court that the decision of Ocasio v. Díaz holds that all children, whether born in wedlock or out of it, have the same rights of inheritance as regards their parents. The Superior Court of Puerto Rico, Ponce Part, has ruled that the minors involved in the case now before the bar are the "sole and universal heirs of Mr. Néstor Luis Torres." Again, this is res judicata as to this case and is binding both upon this Court and the administrative agency below.
Since under the laws of the Commonwealth of Puerto Rico these children are entitled to inherit from their biological parents, Section 216(h) (2) (A) of the Social Security Act is applicable. Under this provision, the Secretary must apply the law of intestate devolution of the state wherein the applicant's intestate was domiciled; that means, according to the facts of this case, the law of Puerto Rico. And, under the law of Puerto Rico, as we have seen, these children are entitled to inherit fully.
In view of the foregoing, it is the ruling of this Court that the decision of the Appeals Council be, and hereby is, vacated and that the decision of the Hearing Examiner be, and hereby is, reinstated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1643778/ | 411 F.Supp. 769 (1975)
Scott M. NISWONGER, etc., Plaintiff,
v.
AMERICAN AVIATION, INC., et al., Defendants.
Civ. A. No. 3148.
United States District Court, E. D. Tennessee, Northeastern Division.
June 25, 1975.
Carleton W. Smith, Greeneville, Tenn., for plaintiff.
O. C. Armitage, Jr., William W. Tweed, Greeneville, Tenn., R. Thomas Stinnett, and Harold B. Stone, Knoxville, Tenn., for defendants.
MEMORANDUM OPINION
NEESE, District Judge.
This is an action in which the plaintiff Mr. Scott M. Niswonger, doing business as Greeneville Air Service (Service), seeks a declaration[1] that a certain lease *770 indenture between the defendant American Aviation, Inc. (American) and the Greeneville-Greene County, Tennessee airport authority (authority)[2] is void as violative of a federal funding statute. 49 U.S.C. § 1349(a). Trial was to the Court on June 3, 1975.
The Court makes the following findings of fact:
1. Service is a licensed air-taxi commercial (or C-135) operator.
2. American is a general fixed-base operator at the Greeneville, Tennessee municipal airport (airport).
3. The authority is a duly constituted public body and an agent of its codefendants the Town of Greeneville, Tennessee (Greeneville) and Greene County, Tennessee (county), charged with the responsibility of overseeing the airport.
4. Greeneville and the county are municipal corporations, organized, existing and operating under the laws of Tennessee.
5. The airport is an air-navigation facility, and such facility and landing areas upon it were constructed with federal funds.
6. By the aforementioned lease indenture of June 16, 1969, the authority leased to American exclusively all the then available facilities suitable for aeronautical activities and evinced thereby an intention to exclude therefrom all other general fixed-base operators.
7. Additional ramp space was constructed by the authority with nonfederal funds and put to use in 1974 in its operations by American.
8. There is now available at the airport space for an additional qualified general fixed-base operator,[3] and American has been granted by the authority, Greeneville and the county more area at such airport than American can actually use reasonably in its existing operations.[4]
9. Air Service applied to the authority in September, 1973 to become an additional general fixed-base operator at the airport. The authority did not consider such application, because all the ramp space then existing at the airport was leased to American.[5]
10. American advised the authority of its intention to exercise, under the terms of the aforementioned indenture, its right of renewal thereof.
The Court concludes legally, as follows:
A. This Court has jurisdiction of the subject matter and of the parties. 28 U.S.C. §§ 1331, 1337, 2201; see memoranda opinions and orders herein of August 1, 1974, March 4, and June 2, 1975.
B. "* * * There shall be no exclusive right for the use of any landing area or air navigation facility upon which [f]ederal funds have been expended. * * *" 49 U.S.C. § 1349(a).
C. An exclusive right for the use of a landing area or air navigation facility upon which federal funds have been expended encompasses "* * * a power, privilege, or other right excluding or denying another from enjoying or exercising a like power, privilege or right. An exclusive right * * * conferred on one or more parties but excluding others from enjoying or exercising a similar right or rights * * *" is an exclusive right. "* * * The leasing of all available airport land or facilities suitable for aeronautical activities to a single *771 enterprise * * * [is] * * * evidence of an intent to exclude others. * * * The amount of space leased to a single enterprise should be limited to that for which it can clearly demonstrate an actual, existing need. * * *" Department of Transportation, Federal Aviation Administration, advisory circular no. 150/5190-2A of April 4, 1972.
D. 49 U.S.C. § 1349(a) was enacted from considerations of public concern and subserves the general welfare.
E. 49 U.S.C. § 1349(a) cannot be abrogated or circumvented by private agreement of American and the authority. 17 C.J.S. 1001 Contracts § 201.
F. The lease indenture of June 16, 1969 between American and the authority violates 49 U.S.C. § 1349(a), a statute enacted for the protection of the public, in so far as it grants American the exclusive right for the use of the landing area and the air navigation facility at the airport.
G. A substantial controversy between parties having adverse legal interests is presented herein, wherein the relief sought is a reality requiring an immediate determination, so that the circumstances warrant the issuance of a declaratory judgment. City of Tullahoma, Tenn. v. Coffee County, Tenn., D.C.Tenn. (1962), 204 F.Supp. 794, 797[1], reversed on other grounds, C.A. 6th (1964), 328 F.2d 683; see also In Re Wilson, D.C. Tenn. (1970), 314 F.Supp. 271, 272[3].
Judgment will enter, therefore, that the leasehold indenture of June 16, 1969 between American and the authority, Greeneville and the county is violative of 49 U.S.C. § 1349(a), to the extent that it grants to American the exclusive right for the use of the landing areas and air navigation facility on the real property described therein; that to such extent it is void and inoperable; and that it may not be renewed by the parties thereto with such grant of exclusive right included therein.
NOTES
[1] The Court limited the issue on trial to whether Service is entitled to a judicial declaration that such contract is void, together with the collateral issues, whether space is now available at such airport for an additional fixed-base operation, and whether American has been granted the exclusive use of more area at the airport than it can use reasonably in its current operations.
[2] The defendants the Town of Greeneville, Tennessee and Greene County, Tennessee were also parties to such agreement.
[3] The end of a public roadway and an existing fence separate a portion of the airport property from existing ramp spaces. It was not demonstrated that these barriers could not reasonably be eliminated.
[4] Although there have been occasional times when users of aircraft experienced slight delays in their movements thereof to and from takeoff and landing areas because of congested traffic thereon, such delays are not encountered generally.
[5] State Rep. Joe L. Bewley, chairman of the authority since its inception, conceded such to be the reason for the authority's inaction. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1913896/ | 705 So.2d 189 (1997)
GULF STATES LAND AND DEVELOPMENT, INC., et al., Plaintiffs-Appellants,
v.
The OUACHITA NATIONAL BANK IN MONROE, Defendant-Appellee.
Nos. 29134-CA, 29135-CA and 29136-CA.
Court of Appeal of Louisiana, Second Circuit.
April 4, 1997.
Writ Denied September 19, 1997.
*190 Theus, Grisham, Davis & Leigh by J. Michael Hart, Sharon I. Marchman, Monroe, for Plaintiffs-Appellants.
Winstead, Sechrest & Minick by Wesley W. Steen, Baton Rouge, Shotwell, Brown & Sperry by George Wear, Jr., Monroe, Taylor, Porter, Brooks & Philips by Harry Philips, Jr., Baton Rouge, for Defendant-Appellee.
Boles, Boles & Ryan by Lawrence Scott Patton, Monroe, for Intervenor, Regions Bank.
Before BROWN, WILLIAMS and STEWART, JJ.
BROWN, Judge.
This litigation spans nearly a decade. A group of individuals and their corporation, Gulf States Land & Development, Inc., sued the defendant-bank for breach of contract, extortion and defamation in connection with the Bank's failure to fulfill a loan commitment to develop a subdivision. The Bank sued the Gulf States parties for non-payment of 41 promissory notes. When the air cleared, there were judgments in favor of all parties. With certain amendments, this court affirmed.[1] The parties are now back with questions concerning offset and compensation of the different awards. The precise issue presented is whether the district court properly calculated the amounts owed to the *191 respective parties under the terms of the judgment. We reverse and render.
Facts and Procedural History
The "Gulf States parties" (Mr. and Mrs. Stanley Palowsky, Mr. and Mrs. Larry James, Mr. and Mrs. Walter Meredith, Dr. John Smiarowski and Gulf States Land & Development, Inc.) attempted to develop a residential subdivision north of Monroe, Louisiana in the 1980s. Ouachita National Bank (known subsequently as "Premier Bank" and now "Bank One") committed to finance this project and loaned money to the Gulf States parties, who executed a series of promissory notes in connection with these loans.
Gulf States, Inc. signed all of the notes; however, the individual parties signed separate promissory notes as guarantors. A collateral note secured by a mortgage on the subdivision property was executed by the individual co-makers and their spouses to secure the 41 promissory notes. Palowsky was co-maker with Gulf States, Inc. on 12 promissory notes which had a combined face value of $675,666.66. James was a co-maker with Gulf States, Inc. on 13 promissory notes which had a combined face value of $725,666.68. Smiarowski was a co-maker with Gulf States, Inc. on 13 promissory notes which had a combined face value of $725,666.66. Meredith was a co-maker with Gulf States, Inc. for three notes which had a combined face value of $264,000; however, Meredith also signed a continuing guaranty agreement for $563,000.
The business venture encountered difficulties and the parties became embroiled in litigation.[2] The Gulf States parties asserted various causes of action against the Bank; including an extortion claim by Palowsky. The Bank sought judgment against the Gulf States parties on the promissory notes.
The cases were consolidated for trial. A jury returned verdicts in favor of each of the Gulf States parties for breach of contract and in favor of Stanley Palowsky on his extortion and defamation claims. The trial judge granted judgment in favor of the Bank on the promissory notes and awarded attorney fees incurred in collection of the notes.
In its judgment on the promissory notes, the trial court found that the corporation, Gulf States, Inc., was liable to the Bank for the entire indebtedness, but that Palowsky, Smiarowski, James and Meredith were liable, in solido, with Gulf States, Inc., to the limited extent of the guaranty and promissory notes they each individually executed as co-maker and for interest and attorney fees associated with those obligations.
After adding interest accrued to July 31, 1992, the judgment on the unpaid promissory notes against Gulf States, Inc., totaled $3,670,812.92. Each individual, however, was only liable in solido with Gulf States, Inc., to the following extent:
(a) Gulf States Inc.: $3,670,812.92
(b) Mr. Palowsky: 967,557.17
(c) Mr. Smiarowski: 1,038,285.64
(d) Mr. James: 1,038,446.78
(e) Mr. Meredith: 563,000.00
In addition, attorney fees of $855,646.50 were awarded to the Bank, the individual parties being liable in solido with Gulf States, Inc., to the following extent:
(a) Gulf States Inc.: $855,646.50
(b) Mr. Palowsky: 250,195.14
(c) Mr. Smiarowski: 268,616.58
(d) Mr. James: 268,616.58
(e) Mr. Meredith: 145,600.28
The jury found merit to Stanley Palowsky's extortion claim and awarded him $2.5 million in damages. However, the district judge determined after trial that Palowsky's extortion claim had prescribed and granted the Bank's motion for judgment notwithstanding the verdict (JNOV) on the extortion *192 claim.[3] On appeal, this court agreed that Palowsky's extortion claim had prescribed, but that:
[T]he jury award of Two Million Five Hundred Thousand Dollars ($2,500,000) to Stanley R. Palowsky, Jr., and against Defendant, [Bank One], is affirmed only insofar as it may be used to offset the amount of [Bank One's] judgments, including interest, attorney fees and court costs, against Stanley R. Palowsky, Jr., in the March 19, 1993 judgment.
Palowsky v. Premier Bank, N.A., 26,255, consolidated with 26,299, 26,300, 26,301 (La. App.2d Cir. 4/5/95), 653 So.2d 1380 (unpublished opinion, attached as Appendix A), writs denied, 95-1335, 95-1378 (La.10/27/95), 661 So.2d 1368.
Furthermore, on appeal this court reduced the jury's $7 million breach of contract award to Gulf States, Inc. to $2 million and the Palowskys' award of $1.25 million for breach of contract to $400,000. This court otherwise left the jury's findings and trial court's judgment undisturbed. The jury and court had decreed that:
Larry and Dianne James were entitled to a $200,000 breach of contract award against the Bank;
John Smiarowski was entitled to a $200,000 breach of contract award against the Bank;
Walter and Mona Meredith were entitled to a $200,000 breach of contract award against the Bank;
The Bank was entitled to funds in the registry of the court, which would be credited against the sums due the Bank;
The Bank's mortgage was to be recognized and maintained; and;
The Gulf States parties were liable for interest on the unpaid principal from the date of July 31, 1992, at the rate of 9.25% per annum.
After the supreme court denied direct review on October 27, 1995, the parties attempted to execute the judgment as amended on appeal.
The parties submitted their respective interpretations of the final judgment.[4] The trial court's calculation of the amounts due the parties is now at issue. The trial court offset the prescribed extortion award as to Palowsky only. Thus, Palowsky's obligation on the promissory notes he signed was extinguished; however, the court refused to reduce the debt owed by Gulf States, Inc., and the other Gulf States parties by the amount of Palowsky's offset.
The trial court then set off the non-Palowsky Gulf States parties' breach of contract claims against the Bank's judgment and found that the Bank was owed $830,782.02 plus interest. Gulf States, Inc., John Smiarowski, Larry James and Walter Meredith were found liable in solido for this amount, except that Meredith's liability was limited to the principal sum of $48,641.85 plus interest. Because Palowsky's debt to the Bank was extinguished by the prescribed extortion judgment, the Bank was held liable to Palowsky for the $400,000 awarded by the jury for breach of contract.
The Gulf States parties now appeal. They contend that under a proper interpretation of the March 1993 judgment as amended on appeal, they are net judgment creditors of the Bank, who has answered the appeal, asking only that the district court's judgment be amended to explicitly acknowledge continuing interest in Bank One's favor.
Discussion
Compensation is a method by which obligations are extinguished. When two persons owe each other money, compensation is a mechanism of extinguishing each obligation without the necessity of an actual disbursement of funds by the parties. La.C.C. art. *193 1893. In common law, this is known as set-off. Saul Litvinoff, Obligations § 19.1, at 658, 5 Louisiana Civil Law Treatise (1992).
Solidary obligors are liable for the whole debt; however, the creditor is only entitled to collect the full amount and no more. Thus, when one solidary obligor pays the debt in full, the creditor can collect nothing more from the other obligors. As noted above, compensation is a method of paying a debt. Under La.C.C. art. 1898, compensation only extinguishes the debt to the extent owed by the obligor who is entitled to the compensation. Tolbird v. Cooper, 243 La. 306, 143 So.2d 80 (1962).
In Young v. Fremin-Smith, Inc., 265 So.2d 341 (La.App. 4th Cir.1972), a plaintiff-employee filed suit against his former employer seeking unpaid wages. The defendant-employer asserted as set-off $4,000 allegedly owed by the employee for damaged equipment. Because the employer's claim was prescribed, he was unable to directly obtain a monetary award. However, the court permitted the employer to extinguish the employees claim for unpaid wages with the prescribed claim pursuant to La.C.C.P. art. 424.[5] The court held that the obligation owed to the employee was extinguished by judicial compensation as recognized and defined by the supreme court in Tolbird, supra.
In Fireman's Fund v. Charles Carter Construction, 382 F.Supp. 332 (M.D.La.1974), the federal district court recognized that a claim can be compensated legally or judicially even though prescribed. In holding that the prescribed claim could be offset, the federal court referred to the holding in Tolbird, supra, that to urge a prescribed claim as a defense pursuant to La.C.C.P. art. 424, the requirements for legal compensation did not have to be present:
[I]t is apparent that Article 424 of the Code of Civil Procedure does no violence to Article 2209 [now 1893] of the Civil Code, and when it speaks in terms of "obligations" and "causes of action" it directs itself to both legal compensation and judicial compensation as the case may be. It permits the urging of prescribed "obligations" and "causes of action" as defenses whether the conditions of Article 2209 [now 1893] of the Civil Code are met or not.
Fireman's Fund, 382 F.Supp. at 338.
Louisiana jurisprudence makes no distinction between a "defense" under La. C.C.P. art. 424 and an "affirmative claim" for legal or judicial compensation. Set-off or compensation, whether asserted by way of affirmative defense, reconventional demand or claim, results in extinguishment of the debt. See Coburn v. Commercial National Bank, 453 So.2d 597 (La.App.2d Cir.1984); Labbe v. Premier Bank, 618 So.2d 45 (La. App. 3d Cir.1993); Thibaut v. Thibaut, 607 So.2d 587 (La.App. 1st Cir.1992). The trial court erred in concluding otherwise.
In this case, compensation occurred between Palowsky's prescribed extortion claim, which he successfully asserted as a defense pursuant to La.C.C.P. art. 424, and the Bank's promissory note judgment. This court's previous opinion, in which judicial compensation was ordered, set off the Bank's judgment against Palowsky in the amount of his particular promissory notes, attorney fees and interest, thus extinguishing these obligations.
Performance by one solidary obligor relieves the others of liability (to that extent) toward the obligee. La.C.C. art. 1794. The goal of article 1794 is complete reparation, no more, no less. Fertitta v. Allstate Insurance Co., 462 So.2d 159 (La.1985). Therefore, all solidary obligors benefit to the extent of payment or extinguishment, even where one obligor pays or extinguishes only part of the entire amount due. Williams v. Sewerage & Water Board of New Orleans, 611 So.2d 1383 (La.1993).
The clear import of the trial court's judgment as amended by this court was that the individual Gulf States parties were not liable in solido with each other, but liable in solido with the corporation, Gulf States, Inc., on the particular promissory notes that they each *194 signed. Thus, compensation between the Bank and Palowsky liberates the solidarily obligated Gulf States, Inc., in the same measure and to the same extent that Palowsky is liberated.
The trial court's error was in not reducing the liability of Gulf States, Inc., by the amount of the principal, interest and attorney fees owed by Palowsky on the notes executed by Palowsky and the corporation.
Conclusion
Based on the computation of interest agreed to by the parties and used by the trial court, we calculate the offsetting debts as of October 27, 1995 (the date the judgment on appeal became final).
I. Award to the Bank Principal, $5,297,706
interest and attorney fees on
promissory notes
II. Reduced as follows:
A. Money withdrawn from
the court registry and ordered
credited against
the debt ($293,369)
B. Palowsky's notes, attorney
fees, and interest ($1,425,980)
C. Breach of contract award
to the corporation, with
interest ($3,436,095)
Balance owed by Gulf
States, Inc., to the Bank $142,262
III. Further reduction for the ($1,030,828)
breach of contract awards to
James, Smiarowski and Meredith,
with interest
Balance owed by Gulf
States, Inc. -0-
IV. Individual awards against
Bank One
A. Stanley and Carol Palowsky. $ 400,000
B. Larry and Dianna James,
with interest $343,609 less
40.66% of $142,262, which
is the remaining amount
owed by Gulf States, Inc.,
before compensation of
these individual awards. $ 285,765
C. John Smiarowski with interest.
$343,609 less
40.66% of $142,262, which
is the remaining amount
owed by Gulf States, Inc.,
before compensation of
these individual awards. $ 285,765
D. Walter and Mona Meredith
with interest.
$343,609 less 18.68% of
$142,262, which is the remaining
amount owed by
Gulf States, Inc., before
compensation of these individual
awards. $ 317,034
V. Legal interest on the awards
to Smiarowski, the James and
the Merediths, is to run from
October 27, 1995, until paid.
Legal interest on the Palowskys'
award is to run from
judicial demand until paid.
Decree
We hereby REVERSE the judgment of the trial court and RENDER judgment as follows:
IT IS ORDERED, ADJUDGED, AND DECREED that the liability of the Gulf States parties on the promissory notes, with attorney fees, and interest to Bank One, f/k/a Premier Bank, f/k/a Ouachita National Bank in Monroe, contained in the trial court's March 19, 1993, judgment, is hereby extinguished.
IT IS ORDERED, ADJUDGED, AND DECREED that there be judgment in favor of LARRY AND DIANNE PYLE JAMES and against BANK ONE in the amount of $285,765, together with legal interest from October 27, 1995, until paid.
IT IS ORDERED, ADJUDGED, AND DECREED that there be judgment in favor of JOHN SMIAROWSKI and against BANK ONE in the amount of $285,765, together with legal interest from October 27, 1995, until paid.
IT IS ORDERED, ADJUDGED, AND DECREED that there be judgment in favor of WALTER AND MONA MEREDITH and against BANK ONE in the amount of $317,034, together with legal interest from October 27, 1995, until paid.
IT IS ORDERED, ADJUDGED, AND DECREED that there be judgment in favor of STANLEY PALOWSKY AND CAROL HARGUS PALOWSKY and against BANK ONE in the amount of $400,000, together with legal interest from the date of judicial demand.
IT IS ORDERED that the trial court cancel the mortgage in favor of PREMIER *195 BANK, N.A., recognized in Paragraph XII of its March 19, 1993, judgment.
IT IS ORDERED, ADJUDGED, AND DECREED that BANK ONE is to bear the costs, here and below.
REVERSED AND RENDERED.
NOTES
[1] This opinion was unpublished. In order to better understand the present issues we now, with the permission of a majority of the original panel, publish that opinion as appendix A. [Editors Note: The text of the unpublished opinion appears as an appendix on WESTLAW.]
[2] There have been numerous reported decisions dealing with matters incident to this litigation. See Ouachita National Bank in Monroe v. Palowsky, 554 So.2d 108 (La.App.2d Cir.1989); Ouachita National Bank v. Palowsky, 570 So.2d 114 (La.App.2d Cir.1990); Ouachita National Bank v. Gulf States, 556 So.2d 50 (La.1990); Palowsky v. Premier Bancorp, Inc., 595 So.2d 670 (La.App. 1st Cir.1991); Ouachita National Bank in Monroe v. Gulf States Land & Development, Inc., 579 So.2d 1115 (La.App.2d Cir.), writ denied, 587 So.2d 695 (La.1991); Palowsky v. Premier Bancorp, Inc., 597 So.2d 543 (La.App. 1st Cir.1992); Gulf States Land & Development, Inc. v. Ouachita National Bank in Monroe, 612 So.2d 1031 (La. App.2d Cir.), writ denied, 618 So.2d 406 (La. 1993).
[3] The jury also awarded Palowsky $800,000 against the Bank for defamation. The trial court granted the Bank's JNOV on the merits and dismissed this claim, which we affirmed.
[4] On January 23, 1996, Regions Bank, a third party, intervened in these proceedings. On January 25, 1996, Roy and Linda McCaskill intervened. On February 26, 1996, the Bank filed a "motion of intervention" in order to seize Palowsky's litigious rights in the suit; however, they sought no separate or different relief than that claimed by the Bank and the Gulf States parties.
[5] La.C.C.P. art. 424 provides in part that a prescribed obligation arising under Louisiana law may be used as a defense if it is incidental to or connected with the obligation sought to be enforced by the plaintiff. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1174028/ | 134 Ariz. 532 (1982)
658 P.2d 185
The STATE of Arizona, Appellee,
v.
Steven Matthew BROKAW, Appellant.
No. 2 CA-CR 2438.
Court of Appeals of Arizona, Division 2.
April 2, 1982.
Rehearing Denied May 12, 1982.
Review Denied June 8, 1982.
*533 Robert K. Corbin, Atty. Gen. by William J. Schafer, III and David R. Cole, Asst. Attys. Gen., Phoenix, for appellee.
Frederic J. Dardis, Pima County Public Defender by Frank P. Leto, Asst. Public Defender, Tucson, for appellant.
OPINION
BIRDSALL, Judge.
After a jury trial, the appellant was convicted of theft. The basis of that charge was the appellant's acquisition of the services of a limousine rental agency by means of a material misrepresentation, A.R.S. § 13-1802(A)(3). The jury found those services to have a value in excess of $100, which made the offense a class 4 felony. A.R.S. § 13-1802(C). The trial court imposed the presumptive sentence of four years imprisonment. The appellant challenges rulings of the trial court that allowed the introduction of evidence concerning other bad acts. He also contends that the court erred in denying his request for an instruction allowing the jury to find the services to be worth less than $100.
Evidence at trial revealed that the appellant had obtained the use of four chauffeured limousines by falsely claiming that he was the head of security for the rock music group "Fleetwood Mac." While making arrangements to rent the limousines, the appellant had claimed that payment for the service would later be made by the band's road manager. Two of the limousines were used to take the appellant and several others to a restaurant, the Lunt Avenue Marble Club. the others were later dispatched to the restaurant, ostensibly to transport members of the party to the Marriot Hotel, where the appellant, again claiming to represent "Fleetwood Mac," had previously reserved 15 to 20 rooms. When the second pair of limousines arrived at the restaurant, one of the drivers learned that his employer had been hoodwinked. The appellant had sneaked away, leaving the members of his party to pay for a lavish meal for which they and the restaurant management had believed he was going to pay.
The appellant was later arrested in Pinal County after making a false report of an airplane crash. In Pinal County, he pled guilty to charges of unlawful possession of marijuana and making a false emergency report. He was then brought to trial in Pima County.
On the first day of trial, the appellant made a "motion in limine" to exclude, inter alia, evidence of his activities at the Lunt Avenue Marble Club. That motion was based upon Rule 404(b), Arizona Rules of Evidence, 17A A.R.S.:
"Other crimes, wrongs, or acts. Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show that he acted in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident."
The trial court refused to exclude this evidence, which was presented at trial during testimony of the restaurant's assistant manager. The appellant now contends that this *534 evidence was inadmissible and should have been excluded.
We agree, however, with the trial court's ruling that evidence of the events at the Lunt Avenue Marble Club was admissible to show intent, and under what is frequently called the "complete story" exception to the general rule excluding evidence of other crimes, wrongs or bad acts. See, e.g., State v. Price, 123 Ariz. 166, 598 P.2d 985 (1979); State v. Reinhold, 123 Ariz. 50, 597 P.2d 532 (1979); State v. Ferguson, 120 Ariz. 345, 586 P.2d 190 (1978). Although the appellant's abandonment of his dinner "guests" may have been a bad act in and of itself, it was also the very act that best revealed his intent to deprive the limousine agency of the value of its services. When the appellant absconded from the restaurant he also abandoned the limousines. It is therefore difficult to imagine how the state could have presented its case clearly without showing what had occurred at the restaurant.
The appellant also complains of the admission of testimony from the highway patrolman who arrested him. That testimony revealed that the appellant had falsely reported a plane crash in Pinal County, had led responding officers on a "wild goose chase" looking for the crash, and had been arrested after the strange conduct led the officers to run a record check on his vehicle. The officer made no mention of the marijuana apparently found in the appellant's possession at the time of the arrest, nor did he mention the charge of false reporting or its disposition.
The appellant made no objection to this testimony as it was given. He contends, however, that an agreement with the prosecutor, reached during argument on his motion in limine, precluded the use of this evidence. A review of the transcript of that hearing reveals otherwise. The appellant's motion sought only the exclusion of evidence of the charges filed against him in Pinal County and of his guilty plea. The prosecutor agreed that he would instruct the witnesses to avoid mention of those subjects. Clarification of that agreement is found in the following exchange, which took place at the end of the hearing:
"MR. ALTHAUS [Defense Counsel]: Your Honor, on the record for just one more thing. It is going to be virtually impossible for Mr. Strohm to bring up the incident in Eloy, without going into this a little bit as to the phone call.
I'm just concerned about pleading to the charge itself, the reference that: didn't he plead to the charge? By that I mean, I'm not talking about the fact he did call the police. I have no problem with that. Because it is not going to make sense for him to have met up with the police. The jury is going to want to know what happened.
I'm talking about the criminal charges afterwards. That is the only thing I have objection to.
THE COURT: The other criminal charges?
MR. ALTHAUS: The UPOM and the fact he did plead to
MR. STROHM [Prosecutor]: I think what the concern is there is a distinction between the bad act, in terms of the actual plea to the misdemeanor of a false alarm, as opposed to the act of phoning in a false alarm.
I will produce evidence that will say the reason the officers stopped this fellow or got in contact with him in Pinal County is because he turned in a false alarm. But I will not get into the fact that he pled guilty to that charge.
MR. ALTHAUS: I just wanted to clarify that. Thank you, Your Honor." (emphasis added)
From this exchange it appears that the officer's testimony was presented in precise conformity with the agreement. Any error in the admission of that testimony was waived.
In his final claim of error, the appellant contends that he was erroneously denied a jury instruction on the "lesser included offense" of "theft of property or services having a value of $100 or less." He argues that he was entitled to such an instruction because there was evidence from which the *535 jury could rationally have found that the value of the services involved did not exceed $100.
We do not believe that this "lesser included offense" analysis can properly be applied to our current theft statute, A.R.S. § 13-1802. That statute does not create separate offenses having the value of the stolen property or services as the distinguishing element. Instead, it defines a single crime, theft, and provides that the classification of the offense for punishment purposes is to be determined by the value of the stolen property or services. A.R.S. § 13-1802(C). A separate statute, A.R.S. § 13-1801(8) requires the finder of fact to determine this value when it is in question. Like other determinations relevant only to the computation of punishment under the present criminal code, we believe this determination was intended to be made separately from the determination of guilt or innocence. If there was evidence in this case, therefore, from which the jury could rationally have found a value of $100 or less, the appellant was entitled to the opportunity to have the jury make that finding.[1] Our review of the record, however, reveals no such evidence.
The only testimony on the subject of value came from the general manager of the limousine rental agency. His uncontroverted testimony was that the first two limousines were dispatched at 1:00 p.m. and returned at 5:30 p.m. The second pair of limousines was dispatched to the restaurant at 3:30 p.m. and returned within the hour. The agency's established charge for its service was 20 dollars per vehicle per hour or portion of an hour, computed from the time of dispatch to the time of return. Using this formula, the value of the services actually performed would be $240 (2 limousines for 5 hours each plus 2 for 1 hour each, a total of 12 "vehicle hours"). The witness testified, however, that his company had been deprived of $320. That testimony further revealed that this figure represented the anticipated "benefit of the bargain" to the company the amount that would have been due if all four limousines had actually been used until the pre-arranged time of 6:30 p.m. In any event, the figure obtained by either method is well in excess of $100.
The appellant's argument for a lower figure is apparently premised upon a belief that he "obtained" less than 5 "vehicle hours" worth of service, because he disappeared after the first two limousines had been in use for only two hours each and before the second pair was dispatched. He therefore received the benefit of less than $100 worth of service. The problem with this argument is that nothing in the theft statute requires that the offender receive the benefit of stolen services. The crime is committed by "obtaining" services. The term "obtain" is defined in A.R.S. § 13-1801(5) to mean, with regard to services, "to secure performance of a service." While a dictionary gives several definitions of the verb "secure," the definition of that term most consistent with the purpose of the theft statute is "to bring about." Webster's Third New International Dictionary (1971). We conclude, therefore, that the correct measure of the value of services under A.R.S. § 13-1802(C) is the value of the performance actually brought about by the offender's conduct, that being the value that most correctly represents the loss to the victim. From the uncontroverted evidence in the case, it was not possible for the jury to rationally find that the value of the performance actually brought about was $100 or less. See State v. Dugan, 125 Ariz. 194, 608 P.2d 771 (1980). We therefore conclude that the appellant was not entitled to the requested instruction and that he suffered no prejudice from the jury's determination of value in its deliberations as to guilt or innocence.
Our review of the record has revealed one technical error in the judgment of the trial court, and the state, in its answering brief, has directed our attention to another. The offense of which the appellant was convicted is a class 4 felony. In sentencing the appellant, the trial court expressly stated *536 that it was imposing the presumptive term and imposed a term of four years, which is the presumptive punishment for a class 4 felony. A.R.S. § 13-701(B)(3). The court's judgment, however, erroneously describes the offense as a class 5 felony. In addition, the trial court erroneously sentenced the appellant "to the custody of the Department of Corrections" instead of "to imprisonment." See State v. Gutierrez, 130 Ariz. 148, 634 P.2d 960 (1981). We therefore modify the judgment and sentence to show conviction of a class 4 felony and a sentence to imprisonment for four years, beginning June 25, 1981, with credit for 163 days of presentence incarceration.
As modified, the judgment and sentence are affirmed.
HOWARD, C.J., and HATHAWAY, J., concur.
NOTES
[1] This could be done by interrogatory. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1174027/ | 658 P.2d 920 (1983)
104 Idaho 249
STATE of Idaho, Plaintiff-Respondent,
v.
Syd TALMAGE, Defendant-Appellant.
No. 13344.
Supreme Court of Idaho.
January 31, 1983.
*921 William B. Taylor, Jr., Grangeville, for defendant-appellant.
David H. Leroy, Atty. Gen., Lynn E. Thomas, Sol. Gen., Lance D. Churchill, Deputy Atty. Gen., Boise, for plaintiff-respondent.
BAKES, Justice.
This is an appeal from a judgment of conviction for first degree burglary, in violation of I.C. § 18-1401.
The defendant appellant was apprehended inside a drug store in Cottonwood, Idaho. The State of Idaho filed a criminal complaint against the defendant appellant on June 26, 1978, charging him with the crime of burglary in the first degree. The defendant testified in his own behalf at his first trial on September 14, 1978, to the effect that a person whom he refused to identify had informed him of a store owner in Cottonwood, Idaho, and that upon contacting the store owner he was hired to break into the store and "make it appear that someone had been searching, you know, mess the place up, go through things." On cross examination, however, the defendant, relying on the fifth amendment, refused to identify who had initially informed him of the job. The court ruled that the defendant had opened the subject on direct examination, that he had waived his right to remain silent and ordered the defendant to answer. When the defendant remained adamant in his refusal, the court proceeded with the trial, stating that the problem would be dealt with at the trial's conclusion. The case was submitted to the jury, which returned to the courtroom after several hours of deliberation and reported that it was unable to reach a verdict. The court instructed the jury to deliberate further, but the jury again returned and the foreman reported that the jury was deadlocked and that further deliberations would be of no use. The court, on its own motion, declared a mistrial and subsequently set a second trial for October 16, 1978.
Before the second trial, on September 25, 1978, the court held a contempt hearing during which the defendant was given another opportunity to answer the questions asked of him during cross examination. The trial court warned the defendant that failure to answer the questions would subject him to a contempt charge and incarceration until he chose to answer. When defendant again refused to answer, the court, by its order filed October 16, 1978, but dated September 25, 1978, found him in contempt of court and sentenced him to the custody of the sheriff until he "indicate[d] a willingness to answer under oath the questions which the court directs him to answer, or until further order of this court."
Upon motion by the defendant, the court, finding that the defendant "had an ongoing duty to answer certain questions ...," but that "it is apparent that defendant ha[d] no intention of complying with the order of the Court ...," entered its Order Terminating Contempt Order on April 6, 1979. Defendant filed various motions on April 13, 1979, including motions to dismiss based on allegations that he had been denied a speedy trial and placed in double jeopardy. The trial court denied these motions and a second trial was held on April 30, 1979, at which time the defendant was found guilty of first degree burglary. The defendant appeals his conviction, alleging that he was denied a speedy trial and that the second trial subjected him to double jeopardy, both in violation of his constitutionally guaranteed rights. Finding no such violations, we affirm.
I
Relying specifically on Art. 1, § 13, of the Idaho Constitution, defendant appellant argues that he was denied a speedy trial in conjunction with the second trial held. Idaho *922 Constitution Art. 1, § 13, guarantees criminal defendants the right to a speedy trial as follows:
"In all criminal prosecutions, the party accused shall have the right to a speedy and public trial. .. ."[1]
The defendant claims that he was deprived of a constitutionally guaranteed speedy trial by the trial court's failure to retry him on October 16, 1978, the date originally set for the second trial, allowing approximately 7 1/2 months to elapse before holding the second trial on April 30, 1979.
The state, in its brief on appeal, argues that under the provisions of I.C. § 19-3501 good cause existed for the delay, and defendant was not denied a speedy trial. Prior to the time period relevant to this action, Idaho Constitution Art. 1, § 13, was supplemented by I.C. § 19-3501 which provided definition of the concept of "speedy trial." See State v. Hobson, 99 Idaho 200, 579 P.2d 697 (1978); Jacobson v. Winter, 91 Idaho 11, 415 P.2d 297 (1966). I.C. § 19-3501 required that a criminal action be dismissed if the defendant was not tried during the next term of court after the information was triable, unless good cause to the contrary was shown. State v. Hobson, supra at 202, 579 P.2d at 699 (1978); see State v. Lindsay, 96 Idaho 474, 531 P.2d 236 (1975).[2] Effective March 1, 1975, however, the Idaho legislature repealed I.C. § 1-706 which required at least two court terms per year in each county. 1975 Idaho Sess. Laws ch. 242, § 1, in response to this Court's promulgation of I.R.C.P. 77(a), effective January 1, 1975, which abolished terms of court. While I.R.C.P. 77(a) did not expressly apply to criminal cases, the action of the legislature in repealing I.C. § 1-706 was general and applied to both civil and criminal actions. Therefore, the action of the legislature in repealing I.C. § 1-706, and the action of this Court in promulgating I.R.C.P. 77(a) precludes the determination of the right to a speedy trial by reference to the terms of court for cases filed after the effective date of the repeal of I.C. § 1-706. State v. Carter, 103 Idaho 917, 655 P.2d 434 (1981).
This Court, in State v. Lindsay, 96 Idaho 474, 475, 531 P.2d 236, 237 (1975), noted the following in regard to the Idaho constitutional guarantee of speedy trial:
"The right of speedy trial as guaranteed by a state constitution or statute cannot be said to be necessarily identical to that right to speedy trial guaranteed in the Constitution of the United States. We find, however, that the `balancing test' laid down in Barker v. Wingo, 407 U.S. 514, 92 S. Ct. 2182, 33 L. Ed. 2d 101 (1972), is consistent with decisions of this court stating that whether one has been deprived of his right to a speedy trial must be decided by reference to considerations in addition to the mere passage of time. Hadlock v. State, 93 Idaho 915, 478 P.2d 295 (1970); Ellenwood v. Cramer, 75 Idaho 338, 272 P.2d 702 (1954)."
Accord, State v. Holtslander, 102 Idaho 306, 308-09, 629 P.2d 702, 704-05 (1981). The "balancing test" enunciated by the United States Supreme Court in Barker v. Wingo, 407 U.S. 514, 92 S. Ct. 2182, 33 L. Ed. 2d 101 (1972), referred to above, is a four-fold balancing test determinative of whether an accused has been denied a speedy trial. The factors to be considered are: (1) the length of delay; (2) the reason(s) for delay; (3) the defendant's assertion of his right; and (4) prejudice to the defendant occasioned by the delay. State v. Holtslander, *923 supra at 309, 629 P.2d at 705; State v. Lindsay, supra at 476, 531 P.2d at 238; see Barker v. Wingo, supra.
The interval between the first and second trials in this action, the delay of which defendant complains, was approximately seven and one-half months. A delay of this length is sufficient to trigger our inquiry into whether a defendant has been denied a speedy trial. See State v. Holtslander, supra. Compared to the delays alleged to have constituted a denial of speedy trial in other actions before this Court, however, this seven and one-half month period intervening between the trials is not in itself so excessive as to outweigh the other balancing factors. See, e.g., State v. Holtslander, supra (elapse of nine months between date original complaint was filed and arrest not inordinate); State v. Lindsay, supra (fourteen month interval between filing complaint and trial, when balanced against other factors, did not constitute denial of speedy trial).
Turning to the reason for the delay, it is apparent that the prosecution did not deliberately attempt to defeat the defendant's right to speedy trial; indeed, counsel for the defendant acknowledges in his brief on appeal that the prosecution was prepared to go to trial on October 16, 1978, the date originally scheduled for the second trial. On the other hand, more than six months of the seven and one-half month period between the defendant's trials can be attributed to the defendant's refusal to answer the questions asked of him on cross examination relating to his testimony on direct during the first trial and the ensuing contempt and commitment proceeding and order issued against the defendant. The trial court's Order and Commitment was to be effective only until the defendant indicated a willingness to answer, at which time defendant was to be returned to open court. Therefore, the defendant held the key to his own speedy retrial and the reason for the greatest portion of the delay between the first and second trials, the defendant's willful disobedience of the trial court's order to answer certain questions, should not be weighed against the state.[3]
Furthermore, the defendant did not assert his right to speedy trial until he filed his Motion to Dismiss on that ground on April 13, 1979, just two and one-half weeks prior to his second trial. At the contempt hearing held on September 25, 1978, the defendant's counsel stated that the defendant did not waive his right to speedy trial; nevertheless, defendant waited some six months to assert his right.
Finally, the defendant has not alleged or shown that he was prejudiced by the delay between the first and second trials, nor does the record reflect that his ability to present his defense was impeded in any way. Although this Court has previously stated that "[i]f [a] defendant can show an unreasonable delay in prosecution, prejudice is presumed," *924 Olson v. State, 92 Idaho 873, 874, 452 P.2d 764, 765 (1969), citing Richerson v. State, 91 Idaho 555, 428 P.2d 61 (1967), we have more recently adopted the view that "prejudice is a central factor in analyzing the right to speedy trial." State v. Holtslander, supra at 313, 629 P.2d at 709. In Holtslander, we held that "where a defendant does not even attempt to make a showing of reasonable possibility of prejudice, then this factor should be given very little weight, if any, for the defendant. Supra at 313, 629 P.2d at 709.
In applying the facts of this case to the balancing test, the four factors, particularly the reason for the delay, weigh against the defendant. On the basis of this record, the scale being demonstrably tipped in favor of the state, we hold that the defendant was not deprived of a speedy trial.
Even if the record established that the seven and one-half month delay constituted a denial of speedy trial, delays in bringing a defendant to trial caused or consented to by the defendant are considered to constitute waiver of the right to be tried within the time affixed by statute or required by constitution. Accord, State v. Wilbanks, 95 Idaho 346, 509 P.2d 331 (1973); Hadlock v. State, 93 Idaho 915, 478 P.2d 295 (1970); Olson v. State, 92 Idaho 873, 452 P.2d 764 (1969); Ellenwood v. Cramer, 75 Idaho 338, 272 P.2d 702 (1954): see also Balla v. State, 97 Idaho 378, 544 P.2d 1148 (1976). As discussed above, the greatest portion of the delay between the two trials was caused by defendant's refusal to answer the questions asked of him on cross examination and the resulting contempt order. Therefore, the delay in this case was attributable to the defendant and he thereby waived any right to complain of the lack of a speedy trial as it related to the second trial.
II
The double jeopardy clauses of the fifth amendment of the United States Constitution, applicable to the states through the due process clause of the fourteenth amendment, and Art. 1, § 13, of the Idaho Constitution, protect a criminal defendant from repeated prosecutions for the same offense. Defendant claims that he was placed in double jeopardy when the trial court retried him for the same charges at issue in the first trial. The defendant claims that "the trial Court did not make sufficient inquiry of the jury, through its foreman to establish a manifest necessity to discharge the jury ...," and thereby overcome the constitutional objection of double jeopardy upon retrial.
In this action, the jury retired to deliberate at approximately 7:30 p.m. on September 15, 1978. At the jury's request, it returned to the courtroom at approximately 11:19 p.m., and the court gave an additional instruction and encouraged the jury to deliberate further in an attempt to reach a verdict. The jury was excused to resume deliberations but returned approximately forty minutes later, at 12:05 a.m. on September 16, 1978, and the following colloquy ensued:
"THE COURT: All right. The record will show all members of the jury are present. Mr. Fitting, are you still unable to reach a verdict in this case?
"JURY FOREMAN: Yes.
"THE COURT: I take it then that the problem that you have is not one of a question about the law or the instructions that I have given the jury. If it is a question about that, if there is any additional instruction or clarification of the instruction, I would be prepared to do that. If it's not a case of that, I would like to know.
"JURY FOREMAN: We are in doubt of the charges against the Defendant.
"THE COURT: All right. Then it is a question that you cannot agree upon the facts?
"JURY FOREMAN: That's right.
"THE COURT: Of the evidence the evidence establishes? All right. Well, the hour is very late. You have been deliberating a long time and I know you have given this a lot of consideration. Now, I just for the record to determine if in your opinion it would do no use to deliberate *925 any further in this case; is that the situation?
"JURY FOREMAN: That is it.
"THE COURT: All right. The Court has no choice then but to declare the jury deadlocked, unable to reach the verdict and therefore I will on that ground declare a mistrial... . ."
In the recent case of Oregon v. Kennedy, ___ U.S. ___, 102 S. Ct. 2083, 72 L. Ed. 2d 416 (1982), the United States Supreme Court stated that "the classical test for lifting the double jeopardy bar to a second trial is the `manifest necessity' standard ..." and that "the most common form of `manifest necessity' [is] a mistrial declared by the judge following the jury's declaration that it was unable to reach a verdict." Oregon v. Kennedy, 102 S.Ct. at 2087. The court further stated that "the hung jury remains the prototypical example" of meeting the manifest necessity standard, citing Arizona v. Washington, 434 U.S. 497, 509, 98 S. Ct. 824, 832, 54 L. Ed. 2d 717 (1978), and Illinois v. Somerville, 410 U.S. 458, 463, 93 S. Ct. 1066, 1070, 35 L. Ed. 2d 425 (1973). Id. See also United States v. Larry, 536 F.2d 1149 (6th Cir.1976), cert. denied, 429 U.S. 984, 97 S. Ct. 502, 50 L. Ed. 2d 595 (1976).
We adhere to the view that it is within the sound discretion of the trial court to declare a mistrial in the interests of justice. Accord Gori v. United States, 367 U.S. 364, 81 S. Ct. 1523, 6 L. Ed. 2d 901 (1961); Lewis v. Anderson, 94 Idaho 254, 486 P.2d 265 (1971); State v. Cypher, 92 Idaho 159, 438 P.2d 904 (1968): see State v. Owens, 101 Idaho 632, 619 P.2d 787 (1979); State v. Lopez, 100 Idaho 99, 593 P.2d 1003 (1979). A trial court's exercise of its discretion will not be reversed on appeal "unless it clearly appears that the trial court abused its discretion, and a party's rights were thereby prejudiced." State v. Cypher, supra 92 Idaho at 165, 438 P.2d at 910. In this action the jury deliberated for a total of more than four hours. Returning to court for the second time, the jury foreman indicated that it would be useless to deliberate further. At that late hour, the trial court, in its discretion, determined that the jury was hopelessly deadlocked and declared a mistrial. This is not a case of "overworking jurors at the expense of those jurors ... with [a] resultant unfair trial," State v. Silcox, 103 Idaho 483 at 492, 650 P.2d 625 (Idaho 1982) (Bistline, J., dissenting). The trial court did not abuse its discretion in declaring mistrial and the retrial violated no constitutional guarantee. See United States v. Larry, supra.
Finding that neither of defendant's rights to speedy trial or against double jeopardy were violated, we affirm the conviction entered in the second trial.
DONALDSON and SHEPARD, JJ., and McFADDEN, J. (Ret.), concur.
BISTLINE, Justice, dissenting:
The Court today holds that defendant's retrial seven and one-half months after a mistrial was declared by the trial court did not abridge defendant's right to a speedy trial or place him in double jeopardy. On the state of the record I am unable to agree.
I. DOUBLE JEOPARDY
Article 1, section 13 of the Idaho Constitution provides that: "No person shall be twice put in jeopardy for the same offense, ... ." This provision precludes a retrial of an accused upon declaration of a mistrial unless there is a "manifest necessity" for the trial court to declare the initial mistrial. "Manifest necessity" for the declaration of a mistrial may be found in the inability of a jury to reach a verdict. United States v. Larry, 536 F.2d 1149 (6th Cir.1976). However, if a mistrial is improperly declared, appellant's retrial is violative of his right not to be subjected to double jeopardy. Id. The "manifest necessity" test was formulated by the United States Supreme Court in United States v. Perez, 22 U.S. (9 Wheat) 579, 6 L. Ed. 165 (1824), where a jury was discharged in a capital case without defendant's consent. The Court there stated:
"We think, that in all cases of this nature, the law has invested courts of justice *926 with the authority to discharge a jury from giving any verdict, whenever, in their opinion, taking all the circumstances into consideration, there is a manifest necessity for the act, or the ends of public justice would otherwise be defeated. They are to exercise a sound discretion on the subject; and it is impossible to define all the circumstances which would render it proper to interfere. To be sure, the power ought to be used with the greatest caution, under urgent circumstances, and for very plain and obvious causes; ... ." Id. at 580, 6 L.Ed. at 165 (emphasis added).
More recently the Supreme Court said in Downum v. United States, 372 U.S. 734, 736, 83 S. Ct. 1033, 1034, 10 L. Ed. 2d 100, 102-03 (1963), that:
"At times the valued right of a defendant to have his trial completed by the particular tribunal summoned to sit in judgment on him may be subordinated to the public interest when there is an imperious necessity to do so. ... Differences have arisen as to the application of the principle... . Harassment of an accused by successive prosecutions or declaration of a mistrial so as to afford the prosecution a more favorable opportunity to convict are examples when jeopardy attaches... . But those extreme cases do not mark the limits of the guarantee. The discretion to discharge the jury before it has reached a verdict is to be exercised `only in very extraordinary and striking circumstances,' to use the words of Mr. Justice Story in United States v. Coolidge, 25 Fed.Cas. 622, 623." (Emphasis added.) (Citations omitted.)
In United States v. Larry, supra, 536 F.2d at 1153, the court looked at the following factors in determining that there was a "manifest necessity" for declaration of a mistrial:
(1) The issue for the jury's consideration was a simple one.
(2) The jury deliberated over a two-day span, as a net result of which was the propounding of questions to the court having no reasonable bearing on the matter of the defendant's guilt or innocence.
(3) The trial judge made repeated inquiry of the foreman as to the jury's potential of reaching an agreement.
(4) The trial judge was informed that the jury had made no progress at all in their deliberations and that the division within the jury had not changed since the outset of the deliberations.
(5) There was not the slightest doubt or equivocation expressed by the foreman regarding the jury's deadlock, nor did any of the jurors seated in the jury box indicate any different view.
A mistrial was declared in the present case by the trial court after the jury had deliberated for just over four and one-half hours. The time was five minutes past midnight. The short colloquy between the trial judge and the jury foreman which resulted in a declaration of mistrial is virtually self-explanatory.
"THE COURT: All right. The record will show all members of the jury are present. Mr. Fitting, are you still unable to reach a verdict in this case?
"JURY FOREMAN: Yes.
"THE COURT: I take it then that the problem that you have is not one of a question about the law or the instructions that I have given the jury. If it is a question about that, if there is any additional instruction or clarification of the instruction, I would be prepared to do that. If it's not a case of that, I would like to know.
"JURY FOREMAN: We are in doubt of the charges against the Defendant.
"THE COURT: All right. Then it is a question that you cannot agree upon the facts?
"JURY FOREMAN: That's right.
"THE COURT: Of the evidence the evidence establishes? All right. Well, the hour is very late. You have been deliberating a long time and I know you have given this a lot of consideration. Now, I just for the record to determine if in your opinion it would do no use to deliberate any further in this case; is that the situation?
*927 "JURY FOREMAN: That is it.
"THE COURT: All right. The court has no choice then but to declare the jury deadlocked, unable to reach the verdict and therefore I will on that ground declare a mistrial." (Emphasis added.)
It is evident that the trial court did not make sufficient inquiry of the jury, through its foreman, to establish a "manifest necessity" to discharge the jury. When the foreman stated the jury's doubt as to the charges against the defendant, which is at the least ambiguous as to meaning, the court instead of seeking clarification suggested that the problem was an inability to agree upon the facts. An obliging foreman answered in the affirmative, true, but it appears that the foreman and the judge were at cross-purposes the foreman saying "charges" and the judge saying "facts." As any practitioner well knows, jurors stand somewhat in awe of judges and often have to be drawn out in order to ascertain what it is they are trying to say in a foreign legalistic world. If attorneys hesitate to correct a judge, a juror is less apt to. A better practice, and one most attorneys have observed, is for enough communication to ascertain to some degree the nature of the problem and the severity of it. It is not unlikely that the uncertain remarks of the foreman did not represent the message which the other jurors wanted conveyed to the judge, and many judges would ascertain from the other jurors if the foreman spoke for all. Jurors simply are not ordinarily going to volunteer anything. Especially when it is after midnight and most have legitimate reasons for being home.
This entire problem might have been averted had the trial judge, instead of sending the jury out at 7:30 p.m. to arrive at a verdict, excused them for the evening to resume their deliberations on the morrow with a fresh mind. I continue to adhere to the views I expressed in State v. Silcox, 103 Idaho 483, 492, 650 P.2d 625, 632 (1982):
"[J]urors have been statutorily accorded certain rights, and ... a denial of those jurors' rights works a denial of an accused's fundamental right to a fair trial. In [State v.] Hernandez [102 Idaho 349, 630 P.2d 141 (1981)] the involved juror's right was to not be denied a rereading of all rather than certain testimony which he wanted. In this case the involved juror's right was the right to pass upon an accused's guilt or innocence, absent any improper coercion from the trial court and not being caused to so deliberate at a time when the minds of most people are at rest. Just as I.C. § 19-2204 in terms absolutely mandatory entitles a jury to further information on a point of law or clarification of testimony, so does I.C. § 19-2202 mandate that the sheriff must, while the jury are kept together during the trial, or during their deliberations, provide them `with suitable and sufficient food and lodging.' Clearly the statute contemplates that jurors entrusted with the awesome responsibility of deciding whether an accused shall go to prison are entitled to work at their task a normal day, and are entitled to have, and know that they have, a lodging for the night so that they may on the ensuing day resume their deliberations with some degree of vim, vigor, and vitality. Clearly this juror's right was in this case wholly disregarded. Nothing in the record intimates in the slightest that the jury was informed of their right to hang it up for the night and stay at suitable lodging which the sheriff would furnish for them, and at county expense. Under these unique, and one would hope unprecedented, circumstances the jury was put to deliberating when it better would have been put to bed so as to be fresh for final summations and the reading of the Court's instructions on the law."
Jurors are people, and as such do tire. Not knowing or being advised that they were entitled to food and lodging at public expense for the evening so they might approach their task on the following day, it is easy to see why nothing was voluntarily stated. Trial judges also tire. Such is evidenced by the following colloquy entered into between the trial judge and defendant's attorney at 11:15 p.m.
*928 "THE COURT: ... [T]he jury has sent out word that they have a problem that they felt needed to be brought to the attention of the Court. So I am going to have them brought in and discuss this very briefly with them to confirm the nature of the problem and see if the Court can give them any further instructions that will help them in reaching a verdict.
"MR. LONGETEIG: ... We would object to the giving [of a further instruction] at this point and we would suggest it not be given and the jury be allowed to deliberate or in the alternative the jury be allowed to recess for the evening and allowed to come back and deliberate when they are more rested. The day has been long, it's been a two day trial, especially today. They are undoubtedly very tried. We feel perhaps a more dispassionate and considerate judgment could be given with a nights sleep.
"THE COURT: Well, I would I would feel that to allow the jury to separate tonight would be creating both legal problems for the continuation of this trial and possibly some other problems that inject complications into this case and I am going to follow this procedure first. I will determine after the jury is in whether I will give them this instruction that I have shown to both counsel. All right, would you have the jury come in, please."
The court then gave the jury this instruction which clearly advised them that after just one more vote they would be discharged:
"I have only one request of you, by law I cannot demand this of you, but I want you to go back into the jury room, then taking turns, tell each other, tell each of the other jurors the weakness of your own position that you can see. You should not interrupt each other or comment on each other's views until each of you have had a chance to talk.
"After you have done that, if you have not already done that, if you simply cannot reach a verdict, then return to the courtroom and I will declare this case mistried and will discharge you with my sincere appreciation for your services.
"You may now retire to continue with your deliberations until you feel that you should inform the Court again of the results of those deliberations."
Unlike the trial judge in United States v. Larry, supra, here no inquiry was made to ascertain whether there had been any movement in one direction or another nor was there otherwise any inquiry into the circumstances of the jury's deadlock. Under these circumstances it is apparent that a weary trial judge did not use his power to declare a mistrial "with the greatest caution, under urgent circumstances [or] for very plain and obvious causes" as is required by the test set forth in United States v. Perez, 22 U.S. (9 Wheat.) 579, 580, 6 L. Ed. 165, 165 (1824). Nor can it be said that this case presented "very extraordinary and striking circumstances" as is required by the test set forth in Downum, supra.
II. SPEEDY TRIAL
The Court today holds that defendant's retrial seven and one-half months after his original trial did not violate his right to a speedy trial because, so it is said,
"the defendant held the key to his own speedy retrial and the reason for the greatest portion of the delay between the first and second trials, the defendant's willful disobedience of the trial court's order to answer certain questions, should not be weighed against the state."
It is a well-established rule that a trial court's authority to order an individual, not necessarily a criminally accused defendant, to testify terminates when the hearing or trial is terminated. This issue was laid to rest by the Ninth Circuit in Yates v. United States, 227 F.2d 844, 845 (9th Cir.1955), (rev'd on other grounds, 355 U.S. 66, 78 S. Ct. 128, 2 L. Ed. 2d 95 (1957)), where Yates was imprisoned "until such time as she may purge herself of the contempts by answering the questions ordered to be answered in each instance or until further order of the court." Yates remained in custody under *929 this order during the rest of the trial which resulted in the conviction of all of the defendants. The other defendants were then released upon posting bail pending appeal, but Yates was held in custody under the contempt order. Yates then appealed the contempt order to the Circuit Court. Upon appeal the Ninth Circuit Court reversed the contempt order stating:
"[O]nce a verdict is returned and the jury is discharged, the trial is ended. Once so concluded, a trial is ended forever. The situation can never be recreated." 227 F.2d at 847.
The Ninth Circuit Court then reasoned:
"Even if it were postulated that these answers were part of the original cross-examination, since the jury was discharged, the guarantee of the Constitution would apply to an answer then compelled. It is probable that the force of the oath which she took in that proceeding had been extinguished by the discharge of the jury. While it is true that perhaps the court might accept the acquiescence of the witness in giving the information under oath as a purging of the contempt, the situation cannot be recreated. This ending may be likened to the fall of the bridge. The bridge may be rebuilt, but it is not the same bridge. All the orders of a court requiring a person to cross the first bridge are vain once it has been swept away. The problem is more baffling than that faced by all the King's horses and all the King's men. This situation is even more dramatic in the trial of a defendant in a criminal case. There, concepts of jeopardy have sway." 227 F.2d at 847 (emphasis added).
The court concluded:
"This Court recognizes that the answers to the questions by Mrs. Yates may still be of great importance to the government of the United States in this or other future criminal prosecution. It might be of great advantage if there were a retrial to have the information. Her attitude was contemptuous and defiant. But, after the end of the trial, it was error to attempt to coerce this witness into testifying before a jury which had been disbanded and could not be legally recalled." 227 F.2d at 847-48 (emphasis added).
An attempt has been made by this Court to dispose of such clear authority by a supposed distinction:
"Litigation, however, is not completed under the Yates standard when a trial court declares a mistrial on the ground that the jury is deadlocked, and the case is distinguishable from Yates on that basis. The action was not ended, as the declaration of mistrial necessitated a retrial at which the same issues would be litigated." Footnote 3, Court's Opinion (emphasis added).
The Yates court addressed that exact proposition to the contrary in the last excerpt above set forth. The Court, I fear, mistakes the law governing coercive imprisonment. In an analogous case, the United States Supreme Court stated:
"[T]he justification for coercive imprisonment as applied to civil contempt depends upon the ability of the contemnor to comply with the court's order... . Where the grand jury has been finally discharged, a contumacious witness can no longer be confined since he then has no further opportunity to purge himself of contempt... . Once the grand jury ceases to function, the rationale for civil contempt vanishes, and the contemnor has to be released." Shillitani v. United States, 384 U.S. 364, 371-72, 86 S. Ct. 1531, 1536, 16 L. Ed. 2d 622 (1966).
Many scholars of the law and private attorneys will see the Court as espousing a new rule of law that a retrial after the declaration of a mistrial is but a mere continuation of the first trial. It is a bold move, but does little to enhance jurisprudence as a science if there be any thought of holding to that goal. The real question is whether evidence may be coerced from a defendant after the close of his first trial for possible use in a second trial. Nay, I say, a thousand times nay. When the first trial ended and the jury was discharged, it was over and not subject to reopening. At a second trial a new jury could be called to retry the *930 issues, but in all respects it would be a second trial not a continuation of the first. It is at that point I side with the Yates court and part with present company in this case.
At the second trial the defendant may decide to not take the stand and stand on his right to do so with some confidence that the State will neither attempt to put him on the stand nor comment on his silence. The trial court was entirely without any power to attempt coercive methods to make the defendant reveal long after the first trial that which he declined to answer at the first trial on the grounds that it might incriminate him. In essence, what we have here is a well-intentioned trial judge using his coercive powers to compel discovery so that the prosecutor would thereby have advance knowledge of the defendant's testimony in the event the defendant did take the stand at his second trial.
It is important to take close note of the post-trial discovery process which led to the defendant's incarceration and the delay of his trial:
"THE COURT: ... [I]f the Defendant persists in refusing to answer these questions I have directed him to answer, then the Court will have no recourse but to vacate that trial setting by reason of the action and refusal of the Defendant and if he's denied a speedy retrial of this case, it will be because of his own choosing.
"Now, as I said, I will give the Defendant an opportunity to answer these questions by the Prosecuting Attorney at this time so I can determine in advance of this trial setting whether he will comply or will not.
"I am not going to leave this trial setting for the 16th and call in jurors on the 16th day of October knowing in advance that the Defendant would refuse to answer these questions.
"Now, of course, he's under no obligation to testify in a retrial, but these matters that are pertinent to his first trial, they are matters that have not been resolved and this is the time I consider to do that.
....
"THE COURT: All right. Before I rule on this, I'd like to ask the State, for the record, whether they are prepared to proceed with the trial of Mr. Talmage, the retrial of Mr. Talmage, with the present state of the case as it now appears. In other words, are you willing to proceed without having the information that you sought to obtain by your questioning on cross examination?
"MR. ALBERS: Your Honor, we could proceed without the information. We would certainly prefer to have it. We proceeded last time without it. It's not a question that we cannot We'd certainly be best to the State to have that information to check out that story and investigate those matters. We could retry it It would be like any other evidence that for one reason or another can't come in. We feel we are entitled to it.
"THE COURT: Well, let's put it this way: If you are in a position of wanting to proceed with the retrial without the information, the Court would permit the trial setting to stand. If you are not willing to proceed, I am prepared to what I am prepared to do is to commit Mr. Talmage to the custody of the Sheriff until he complies with the directive of the Court to answer these questions. If it appears he has not changed his mind a week prior to the trial setting, I would vacate that trial setting at that time so that we would not have a jury brought in needlessly on the 16th day of October and that is how I would proceed.
"MR. ALBERS: With that option, Your Honor, I would then request the Court to require that information be made available. It would certainly be helpful in checking into the credibility of that story." (Emphasis added.)
The trial court's errors are self-evident. It tried to procure testimony after the close of a trial which could never be reopened and which could have no effect on that trial. It imprisoned a man not for punishment for his refusal to testify at the first trial (which I concede that it could do) but *931 to ascertain what he would say if he did testify at the second trial, even though acknowledging at the same time that "he's under no obligation to testify in a retrial." Third, and possibly the most egregious holding made and affirmed at this level is the use of contempt power for discovery purposes. Our criminal justice system does not countenance the imprisonment of an accused defendant in order to obtain discovery which the Court thinks should be available to the prosecution. In short, there has been a denial of due process.
The defendant was improperly confined in an attempt to make him give pre-trial testimony. The state clearly ratified and acquiesced in the procedure. Hence, it was the state, not the defendant, which held the key to defendant's right to a speedy trial. The confinement of Talmage was unlawful, and the delay of trial occasioned thereby cannot serve as a defense for the failure to respect defendant's right to a speedy trial.
III. YATES REMEDY OF APPEAL NOT AVAILABLE IN IDAHO
A distinction between this case and Yates is that although in both cases the trial court utilized coercive confinement to obtain defendant's testimony, the Yates case proceeded to trial and Yates, along with other defendants, was convicted. The other defendants were allowed bail and released, but Yates continued to be held. When first jailed for refusing to answer on cross-examination while the trial went ahead, Yates immediately filed notice of appeal. When, after she was convicted of conspiracy and alone denied bail, a second order was entered continuing her confinement pursuant to the first order of contempt which contained the provision that she would remain imprisoned until she answered the question which had been put to her. She also appealed the second order. The Circuit Court of Appeals upheld the first order, as would have I, but held "it was error to attempt to coerce this witness into testifying before a jury which had been disbanded and could not be legally recalled." Yates, 227 F.2d at 848.
A singular distinction between Yates and this case is that an order holding a person in contempt is not appealable under I.C. § 7-614,[1]Parker v. Parker, 97 Idaho 209, 541 P.2d 1177 (1975); Glenn Dale Ranches, Inc. v. Shaub, 95 Idaho 853, 522 P.2d 61 (1974); Barnett v. Reed, 93 Idaho 319, 460 P.2d 744 (1969) which apparently is not the rule in the federal system. Only by wholly ignoring Yates can the Court today uphold the trial court's ruling that it would not proceed with a second trial nor free Talmage from his coercive confinement until he would answer questions and thereby furnish evidence which could be used against him at a second trial if he were to take the stand. Moreover, and another proposition of law into which I have no time to delve, is the probable use the prosecutor might make of such coerced testimony at a second trial even if Talmage did not take the stand. Having once done so in the criminal prosecution against him, I would not be surprised to find some authority holding that his former testimony whether at his first trial, or given after it in order to gain release from confinement might be allowed into evidence.
IV. DENIAL OF THE RIGHT TO A SPEEDY TRIAL WAS COERCIVE, IRRESPECTIVE OF THE COERCIVE INCARCERATION
The point to keep in mind in weighing my views against those found or implied in the Court's opinion is that the confinement of Talmage was coercive in two respects:
(1) He would not be freed until he agreed to answer the questions, but would be confined indefinitely, and
(2) He would not be accorded his right to a speedy (second) trial until he complied with the trial court's order that he answer the questions.
*932 The issue before us today is, of course, the second. It is properly before us because, other than for the trial court's unlawful and erroneous order, the defendant would have had his second trial close upon the heels of the first, and that issue would never have arisen. The Court's opinion speaks in terms of the delay between the first and second trial being caused by "the defendant's willful disobedience of the trial court's order to answer certain questions," but declares that the delay so occasioned "should not be weighed against the state." This is difficult to accept. Having mentioned above that although the procedure elected was of the court's making the state ratified and acquiesced therein, it is perhaps well to point to that specific portion of the transcript which makes the court's statement excusing the state entirely untenable:
"THE COURT: ... I am prepared to give you another opportunity to answer those questions under oath that the Prosecutor might put to you concerning your direct testimony in your trial and if you refuse to answer any questions that the Court deems to be relevant to your testimony on direct examination or reasonably connected with that testimony, I would consider it to be a contempt of court and I'd be prepared to take certain action.
"Now, that action could be that I could commit you to jail until such time as you decide you will answer the questions put to you. In this way you would be committed there until those answers were made or until you decided that you would answer. If you should later decide that you would answer those questions and did do so, you would be released from this type of a commitment to jail.
"Now, you may say, well, I am already in jail. So what?
"The time that you would spend in jail because of this refusal to answer would not count toward any sentence that you might otherwise receive in this case, so the effect of this would be that once these proceedings are done with here, the time that you'd not get any credit for this time. In other words, you are just going to be sitting there.
....
"MR. LONGETEIG: ... So before we announce any intentions what we are going to do in the future to the Court, we'd ask the Court to reconsider the original matter.
....
"THE COURT: Well, the Court is not going to change its opinion about the refusal to answer previously. I am satisfied that the Defendant properly was required to answer that question put to him and that the waiver that he had waived his Fifth Amendment right. What the Defendant is trying to do is to, of course, protect himself in both places at the expense of a fair and complete and honest disclosure of the facts. Based upon the result in the Cartwright case and the result in the Defendant's own trial raised a serious question as to the believeability of the Defendant's story. Obviously in those two trials, twenty-three out of twenty-four jurors did not believe the Defendant's story.
"MR. LONGETEIG: I would object, Your Honor, to any consideration of such a matter. Until this man's convicted by a full jury, he is entitled to the presumption of innocence, so I just don't think that is even proper to consider at this point.
"THE COURT: Well, this is what goes to this Court's statement that because of this refusal the jury has not had an opportunity in either one of these cases to fully see the evidence that properly should have come into the trial and to fully test this Defendant's testimony in each of those trials.
"Now, as far as the Defendant's not being given a speedy trial, a speedy retrial of this case, the Court is prepared, of course, to set this matter down and have set this matter down for trial on the 16th day of October. But if the Defendant persists in refusing to answer these questions I have directed him to answer, then the Court will have no recourse but to vacate that trial setting by reason of the *933 action and refusal of the Defendant and if he's denied a speedy retrial of this case, it will be because of his own choosing.
"Now, as I said, I will give the Defendant an opportunity to answer these questions by the Prosecuting Attorney at this time so I can determine in advance of this trial setting whether he will comply or will not.
"I am not going to leave this trial setting for the 16th and call in jurors on the 16th day of October knowing in advance that the Defendant would refuse to answer these questions.
"Now, of course, he's under no obligation to testify in a retrial, but these are matters that are pertinent to his first trial, they are matters that have not been resolved and this is the time I consider to do that.
"Now, Mr. Talmage, knowing that what the Court's position on this is, do you choose to Is it still your position that you would refuse to answer, here and now today, the questions that the Court might direct you to answer regarding the testimony that you gave at your own trial?
"THE DEFENDANT: I need I'd like to have a few minutes to talk to Mr. Longeteig.
"THE COURT: All right. We will take a recess so you will have that opportunity. Mr. Longeteig, let me know when you are ready to resume the hearing.
"MR. LONGETEIG: Yeah.
....
"THE COURT: All right. Mr. Longeteig, you have had a chance to talk to Mr. Talmage now.
"MR. LONGETEIG: That's correct, Your Honor, and without lending any disrespect to this Court, Mr. Talmage is still does not want to answer that question for the reasons previously stated and therefore would respective respectfully decline to do so."
Following which the court offered the prosecutor the option of going to trial or not, as set forth previously in Part II, after which the following took place:
"THE COURT: Mr. Talmage, let me ask you directly then: Do you at this time refuse to answer the questions, the particular question that I read to you this morning or questions that might be related to your direct examination at your last trial? Will you now refuse to answer those questions?
"MR. TALMAGE: Yes, sir, Your Honor, I would have to.
"THE COURT: All right. Based upon that refusal then, the Court finds you in contempt of court. I will sentence you to the custody of the Sheriff until you have you comply with the directive of the Court to answer those questions."
As I have gone to great pains to point out, it is clear from the foregoing that the defendant was not ordered to be incarcerated for not answering questions at the first trial, but rather for refusing to answer the same questions when propounded to him by the court at the hearing which took place on September 25, long after the first trial had been terminated by the court's declaration of a mistrial. If such is not clear enough, I point also to the order of the trial court which recites that "the court thereupon found the defendant to be in contempt of court and sentenced him to the custody of the Idaho County Sheriff until he indicates his willingness to answer the questions." R. 51. If that be thought insufficient, I point to the court's letter of April 2, 1979, wherein it is made absolute that defendant was not at any time incarcerated for his refusal to testify at the first trial when he voluntarily took the stand:
"The Court believes that the defendant may still be subject to the penalties of criminal contempt under § 18-1801(6) Idaho Code, for his refusal as a witness to answer questions in the Cartwright trial on September 13th, 1978, and for his subsequent refusal to answer questions in his own trial on September 15th, 1978. If convicted, it would appear that defendant could be sentenced to up to six months in jail on each count. I see nothing in the records of these cases or in the Court's *934 Civil Contempt Order that would prevent the prosecuting attorney from filing such criminal contempt charges, if he chooses to do so. If this is done, the charges would be heard by some other judge of this court.
"In the event that defendant testifies at his re-trial in a similar manner, and refuses to answer questions when ordered to do so, it will be the Court's intention to treat the matter as a criminal contempt under § 18-1801(6) Idaho Code. It will also be the Court's intention to strike any of the defendant's testimony concerning a subject about which he refuses to answer questions on cross examination, when ordered to answer such questions, and the jury will be instructed appropriately to disregard that particular testimony of defendant." R. 68-69.
It is beyond cavil that defendant's incarceration was not just for the coercive purpose of providing testimony for a second trial, but to delay a second trial until defendant capitulated, and that the prosecutor, although conceding he could have gone to trial on October 16th, elected to make use of the option being offered him by the court at the defendant's expense. Where, as noted by the court in the excerpt above from the September 25th hearing, eleven of the jurors at the first trial were voting to convict defendant at the time of their rather precipitate discharge,[2] there was little if any need to delay the second trial, as the prosecutor seemed to realize.
V. AN ANOMALY REARS ITS UGLY HEAD
Not mentioned in the Court's opinion is that the trial court, as he had intimated he would do, on Talmage's second trial, and conviction, did deny him credit for jail time from September 25, 1978 (date of the post-trial hearing), to April 6, 1979 (date on which the court terminated his order for coercive contempt).
In June of 1982, Talmage from the confines of the penitentiary filed in this Court a petition for an original writ of habeas corpus, the essence of which was that if he had been given credit for his jail time, he would be eligible for release. In a well-written supporting brief he relied extensively upon Yates:
"The trial court's imposition of coercive incarceration, eleven days following that same court's declaration of a mistrial, and for the purpose of inducing the defendant to answer questions propounded on cross-examination during the prior trial is contrary to the holding in Yates v. United States, 227 F.2d 844, Ninth Circuit, (1955):
"`It was improper for trial court, after termination of criminal prosecution, to order defendant committed in coercive restraint for contempt for failure to answer questions propounded in cross-examination.' Id. at 845.
"In Yates, supra, the court while recognizing that the importance to the government of the defendant answering the questions raised on cross-examination, still refused to recognize the unconstitutionality of coercive restraint after the close of the main trial.
"The issue before this court differs from Yates, only in that the Petitioner herein was subjected to coercive restraint following a mistrial where the contempt occurred. However, we ask that this court note the following salient points regarding that difference:
"That by legal definition, a mistrial is a nullity:
"`In legal effect a mistrial is equivalent to no trial at all, and is declared because of some circumstance indicating that justice may not be done if the *935 trial continues.' See C.J.S. Vol. 58, Mistrial, p. 834.
"Even more important, we think, is that the holding in Yates, supra, is predicated to a large degree upon the discharge of the jury; thereby effecting the continual duty to the sworn oath taken, and the ability of the contemptor to purge the contempt:
"`It is probable that the force of the oath which she took in that proceeding had been extinguished by the discharge of the jury.' See Yates v. United States at 847.
"Further, while it is widely recognized that opinions are not rendered in footnotes; it is worthy to note the Yates court's remarks;
"`No case has been cited to us indicating that the duty of a witness to answer even in a civil case extends beyond the discharge of the jury in a particular case.' See Yates, at 847, n. 5." Petitioner's Brief in Support of Petition for Writ of Habeas Corpus, Sup.Ct. No. 14631.
Responsive thereto we issued the alternative writ,[3] and thereafter the respondent, Darrol Gardner, Warden, responded that the petitioner had been released. Anomalous, then is the inexplicable stance which the Court today takes in steadfastly refusing to acknowledge that Talmage was denied his constitutional right to a speedy trial.
VI. CLOSING
In closing, other than that he received a felony conviction obtained in violation of his rights, Talmage, now having served his time for that conviction, and having been given credit for jail time and now released, probably will search no further for the relief denied him here. This Court, for all practical purposes, is the court of last resort. If it seems that I have written at length, it is not for this defendant, but in the hope that other trial judges in other cases will pause to reflect before using the Court's opinion as precedent for such an improper procedure as the Court approves today. As a last word of advice, Yates was not a little case which comes out of obscurity to fill the needs of this particular defendant. It was a big case, big enough to cause the United States Supreme Court to grant certiorari. I commend the reading of the opinions of both the Ninth Circuit Court of Appeals and the United States Supreme Court, 355 U.S. 66, 78 S. Ct. 128, 2 L. Ed. 2d 95 (1957). "[I]mprisonment cannot be used to coerce evidence after a trial has terminated... ." Id. at 72, 78 S.Ct. at 132.
Since writing the foregoing, the Court's opinion has been expanded by a revision of footnote 3 therein. The footnote strangely enough is really the only place that the Court's opinion makes any attempt to meet the main thrust of defendant's appeal and to meet the main theme of that which I have written in a futile attempt to dissuade the other members of the Court from issuing an opinion which most trial lawyers of experience will see as setting extremely bad precedent.
When defendant, and his counsel, were following the trial confronted by a district judge bent on providing the prosecution with responses to previously unanswered questions, the attorney for defendant displayed extreme courage in advising his client, the defendant, that he need not answer. Not only did the defendant face contempt, as the trial court clearly threatened, *936 but the attorney may have well wondered whether he, too, might find himself jailed based on the trial court's notions of obstructing justice where a district court has ordered something to be done. The courage which the attorney here displayed is that type of steadfastness and loyalty to a client which makes for a strong trial bar. The attorney did not believe his client was obliged to incriminate himself, and both stood their ground. Fortunately for the attorney, it was only the defendant who was jailed until he would obey what the court obviously considered to be a lawful order. The attorney did not so believe.
Footnote 3 of the Court's opinion attempts to overcome the Yates case by attributing to it a holding which the case does not contain, i.e., that there is a difference between a trial which terminates by a verdict and a trial which terminates by a mistrial, thus materially unsettling what appears to be rather forthright statements of law in Yates. Worse, however, the Court's opinion attempts to defend an indefensible position by declaring that "[d]isobedience of the trial court's order was contemptuous, regardless of the correctness of that order," and cites the Idaho cases of Barnett v. Reed, 93 Idaho 319, 460 P.2d 744 (1969) and Mathison v. Felton, 90 Idaho 87, 408 P.2d 457 (1965). Here the author of the opinion does a disservice to the science of jurisprudence. Both of these cases bear no relation whatever to the issue presented here which has to do not with the correctness of the order, but with its lawfulness, i.e., did the court act in excess of and beyond its jurisdiction? Error was not ever thought to be an issue on the appeal until it was injected into the footnote.
Much time has already been devoted toward fulfilling my obligation as part of a collegiate court to work toward the fulfillment of justice and the promotion of jurisprudence as a science. To scholars and members of the trial bar I will leave the reading of Barnett v. Reed and Mathison v. Felton, and the holdings therein which I totally accept. With but little extra effort, however, I will set forth that which the Court in Barnett saw as its holding in the Mathison case:
"If the court has jurisdiction of the parties, the subject matter and the authority or power to make the order it did, the disobedience of such order constitutes contempt, regardless of whether the order disobeyed was correct or incorrect. Mathison v. Felton, supra; 12 A.L.R. 2d 1059, at 1107, § 41." 93 Idaho at 321, 460 P.2d at 746.
At stake in that case was the witness's refusal to answer a question based upon the witness's interpretation of a statute which had never before been interpreted. Such is a far cry from the instant case, where surely it can be said that any trial attorney on obtaining his license has to know that one day he may have to and will advise his client that an unlawful order beyond the court's jurisdiction to make cannot form the basis of a contempt conviction for refusing to obey. As was stated in State v. McNichols, 62 Idaho 616, 115 P.2d 104 (1941), and has always been the law in Idaho, and all other jurisdictions with which I have had any contact or exposure:
"Violation of an order which is void because of lack of jurisdiction of the court to make it is not contempt of court, and no one is under compulsion to obey it." 62 Idaho at 624, 115 P.2d at 108.
NOTES
[1] The sixth amendment to the United States Constitution provides the following similar protection: "In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, ... ."
[2] The legislature amended I.C. § 19-3501 in 1980 to read:
"19-3501. WHEN ACTION MAY BE DISMISSED. The court, unless good cause to the contrary is shown, must order the prosecution or indictment to be dismissed, in the following cases:
....
"2. If a defendant, whose trial has not been postponed upon his application, is not brought to trial within six (6) months from the date that the indictment or information is filed with the court." 1980 Idaho Sess. Laws, ch. 102, § 1.
[3] The defendant asserts that the trial court's contempt and commitment order violates the standard established in Yates v. United States, 227 F.2d 844 (9th Cir.1955), cert. granted, 350 U.S. 947, 76 S. Ct. 322, 100 L. Ed. 825 (1956), and was therefore an invalid justification for the delay between trials. The court in Yates held that imprisonment cannot be used to coerce evidence after the trial has terminated. See also Yates v. United States, 355 U.S. 66, 78 S. Ct. 128, 2 L. Ed. 2d 95 (1957); Shillitani v. United States, 384 U.S. 364, 86 S. Ct. 1531, 16 L. Ed. 2d 622 (1966). Litigation, however, is not completed under the Yates standard when a trial court declares a mistrial on the ground that the jury is deadlocked, and the case before us is distinguishable from Yates on that basis. This action was not ended, as the declaration of mistrial necessitated a retrial at which the same issues would be litigated.
Since the action had to be retried, the trial court had authority to hold the contempt hearing subsequent to the mistrial and give the defendant another opportunity to purge himself of his refusal to comply with the court's order. When the defendant remained steadfast in his refusal, the court had authority to punish his contempt by way of commitment. Whether the court should have penalized defendant by incarcerating him for a fixed term rather than "until he indicated a willingness to answer," is a question that could and should have been raised in a habeas corpus, not collaterally in this proceeding. Disobedience of the trial court's order was contemptuous, regardless of the correctness of that order. Cf. Barnett v. Reed, 93 Idaho 319, 460 P.2d 744 (1969) (disobedience of court order constitutes contempt regardless of correctness of order); Mathison v. Felton, 90 Idaho 87, 408 P.2d 457 (1956).
[1] "The judgment and orders of the court or judge, made in cases of contempt, are final and conclusive." I.C. § 7-614.
[2] One can reasonably surmise that had the jury been requested to resume deliberations at normal working hours on the following day, the recalcitrant juror very well might have yielded to the other eleven, and the cost of another trial thus have been avoided. In a way the case is somewhat like State v. Silcox, supra, wherein my separate opinion I suggested that the state may have been the loser when the jury was exhorted at a late hour. Much as the trial court in Talmage's case somehow learned of the 11 to 1 jury count in that case, so has word reached me that it was indeed the state who lost in Silcox.
[3] appearing from a verified Petition presented to this Court that you have in your custody the above named Petitioner, SYD U. TALMAGE; and the Court having reviewed said Petition and finding that it shows prima facie good cause for the issuance of a Writ of Habeas Corpus commanding you to release the Petitioner upon the basis that he has, after being credited with all applicable pre-trial confinement, served his sentence under which he is in your custody.
"NOW, THEREFORE, YOU ARE HEREBY ORDERED AND COMMANDED upon the service of this Order upon you to release the Petitioner from your custody, or show cause, if any you have, by the filing of an Answer in this Court to the Petition herein on or before September 10, 1982, at five o'clock p.m., why you should not be permanently and absolutely commanded by a Writ of Habeas Corpus to release the Petitioner from your custody." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1349195/ | 622 N.W.2d 313 (2000)
243 Mich. App. 218
DETROIT FREE PRESS, INC., Plaintiff-Appellant,
v.
DEPARTMENT OF STATE POLICE, Wayne County Clerk and Ingham County Clerk, Defendants-Appellees.
Docket No. 221772.
Court of Appeals of Michigan.
Submitted July 11, 2000, at Detroit.
Decided November 3, 2000, at 9:25 a.m.
Released for Publication December 28, 2000.
Honigman Miller Schwartz and Cohn (by Herschel P. Fink and Cynthia G. Thomas), Detroit, for the plaintiff.
Jennifer M. Granholm, Attorney General, Thomas L. Casey, Solicitor General, and Thomas Quasarano, Assistant Attorney General, for the Department of State Police.
Cohl, Stoker & Toskey, P.C. (by Ruth E. Mason and Richard D. McNulty), Lansing, for the Ingham County Clerk.
Edward Ewell, Jr., Wayne County Corporation Counsel, and Harnetha W. Jarrett, Assistant Corporation Counsel, Detroit, for the Wayne County Clerk.
Before BANDSTRA, C.J., and GAGE and WILDER, JJ.
BANDSTRA, C.J.
In Mager v. Dep't of State Police, 460 Mich. 134, 595 N.W.2d 142 (1999), the Supreme Court held that information regarding whether private citizens own guns is information of a personal nature, the disclosure of which would constitute a clearly unwarranted invasion of privacy for purposes of an exemption from the disclosure requirements under Michigan's Freedom *314 of Information Act (FOIA), M.C.L. § 15.231 et seq.; MSA 4.1801(1) et seq. We conclude that the same analysis applies here with respect to information regarding concealed weapons permits issued to state legislators and other public officials and affirm the trial court's order granting defendants' motion for summary disposition.
Facts
This case involves FOIA requests made by plaintiff, the Detroit Free Press, Inc.[1] Initially, the Free Press requested from defendant Department of State Police that it be allowed "to inspect and copy records that indicate whether the attached list of Michigan state legislators have concealed weapons permits, and, if so, the type of permit, any relevant restrictions, and the reason for requesting or granting the permit." The requests to defendants Wayne County Clerk and Ingham County Clerk sought permission "to inspect and copy records reflecting all currently valid concealed weapons permits issued by [the] County, including, but not limited to, the name, occupation and reason for requesting or granting of the permit." Following the Supreme Court's decision in Mager, in a supplemental brief filed in the trial court, the Free Press attempted to narrow its request to the counties by specifying that it no longer sought the names of concealed weapons permit holders who are "private citizens [and] not public officials."[2] Both counties responded to the FOIA requests by indicating that they would release the information to the extent it would not reveal the identity of the permit holders involved. The Department of State Police responded by denying the FOIA request altogether.
The Free Press filed this action alleging that defendants had thus violated the FOIA. Upon cross-motions for summary disposition, the trial court concluded that the requested information was exempt from the FOIA's disclosure requirements and ruled in favor of defendants.
Standard of Review and Relevant FOIA Provisions
Recently, in Herald Co. v. Bay City, 463 Mich. 111, 117-119, 614 N.W.2d 873 (2000), our Supreme Court stated the standard of review and summarized the FOIA provisions applicable to this case:[3]
The trial court granted summary disposition for defendants on the basis of its interpretation of the Freedom of Information Act, M.C.L. § 15.231 et seq.; MSA 4.1801(1) et seq. ... This Court reviews the grant or denial of summary disposition de novo. Maiden v. Rozwood, 461 Mich. 109, 118, 597 N.W.2d 817 (1999). Similarly, we review questions *315 of statutory construction de novo as a question of law. Donajkowski v. Alpena Power Co., 460 Mich. 243, 248, 596 N.W.2d 574 (1999); Mager [supra at 143, n. 14, 595 N.W.2d 142]. Because our judicial role precludes imposing different policy choices than those selected by the Legislature, our obligation is, by examining the statutory language, to discern the legislative intent that may reasonably be inferred from the words expressed in the statute. People v. McIntire, 461 Mich. 147, 152-153, 599 N.W.2d 102 (1999). If the language of a statute is clear and unambiguous, the plain meaning of the statute reflects the legislative intent and judicial construction is not permitted. Tryc v. Michigan Veterans' Facility, 451 Mich. 129, 135, 545 N.W.2d 642 (1996). We must give the words of a statute their plain and ordinary meaning. MCL 8.3a; MSA 2.212(1); Turner v. Auto Club Ins. Ass'n, 448 Mich. 22, 27, 528 N.W.2d 681 (1995).
* * *
Subsection 1(2) of the FOIA declares that
"[i]t is the public policy of this state that all persons ... are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and public employees, consistent with this act. The people shall be informed so that they may fully participate in the democratic process." [MCL 15.231(2); MSA 4.1801(1)(2) (emphasis added).]
Consistent with this broadly declared legislative policy, the FOIA's specific provisions generally require the full disclosure of public records in the possession of a public body:
"(1) Upon an oral or written request which describes the public record sufficiently to enable the public body to find the public record, a person has a right to inspect, copy, or receive copies of a public record of a public body....
"(2) A public body shall furnish a requesting person a reasonable opportunity for inspection and examination of its public records, and shall furnish reasonable facilities for making memoranda or abstracts from its public records during the usual business hours....
"(3) This act does not require a public body to make a compilation, summary, or report of information....
"(4) This act does not require a public body to create a new public record, except as required in sections 5 and 11, and to the extent required by this act for the furnishing of copies, or edited copies pursuant to section 14(1), of an already existing public record." [MCL 15.233; MSA 4.1801(3).]
The FOIA provides, in § 13, several exemptions which, if applicable, permit a public body to deny a request for disclosure of public records. On its express terms, the FOIA is a prodisclosure statute, and the exemptions stated in § 13 are narrowly construed. Mager, supra at 143, 595 N.W.2d 142; Bradley v. Saranac Community Schools Bd. of Ed., 455 Mich. 285, 293, 565 N.W.2d 650 (1997); Swickard v. Wayne Co. Medical Examiner, 438 Mich. 536, 544, 475 N.W.2d 304 (1991). The burden of proof rests on the party asserting the exemption. Bradley, supra at 293, 565 N.W.2d 650; Swickard, supra at 544, 475 N.W.2d 304.
At issue in the instant case is the following FOIA exemption:
"A public body may exempt from disclosure as a public record under this act:
"(a) Information of a personal nature where the public disclosure of the information would constitute a clearly unwarranted invasion of an individual's privacy." [MCL 15.243(1); MSA 4.1801(13)(1).]
*316 Analysis
By its terms, § 13 requires that two factors must exist to exempt information from public disclosure. "First, the information sought must be of a `personal nature,' and, second, the disclosure of such information must constitute a `clearly unwarranted,' invasion of privacy." Booth Newspapers, Inc. v. Univ. of Michigan Bd. of Regents, 444 Mich. 211, 232, 507 N.W.2d 422 (1993).
Regarding the first of these factors, the Supreme Court has held that "the fact of gun ownership" is "`information of a personal nature.'" Mager, supra at 143, 595 N.W.2d 142. Applying the standard announced in Bradley, supra at 294, 565 N.W.2d 650, that "`information is of a personal nature if it reveals intimate or embarrassing details of an individual's private life,'" the Mager Court reasoned:
The ownership and use of firearms is a controversial subject, as to which partisans of many stripes hold strong views. Further, knowledge that a household contains firearms may make that house a target of thieves, and thus endanger its occupants. As the State Police warned in the application filed in this Court, "Disclosure under the FOIA to the world at large of the names and addresses of citizens who possess registered handguns would create a virtual shopping list for anyone bent on the theft of handguns, interested, for malicious reasons, in the identities and addresses of citizens who own handguns, and whatever else the criminal mind might evoke."
... A citizen's decision to purchase and maintain firearms is a personal decision of considerable importance. We have no doubt that gun ownership is an intimate or, for some persons, potentially embarrassing detail of one's personal life. [Mager, supra at 143-144, 595 N.W.2d 142.]
Although this case involves public officials, not private citizens, and information about concealed weapons permits, not just gun ownership, we conclude that the same analysis applies here.[4] If anything, the fact that a person has requested or secured permission to carry a concealed weapon is an even more intimate and potentially embarrassing detail of one's private life, compared with the mere fact of gun ownership. Further, while a citizen meeting the statutory criteria may own a gun, he need not articulate any specific purpose for doing so in order to comply with statutory registration requirements. In contrast, the concealed weapons statute requires applicants to show a particularized need for personal protection before a permit is issued. MCL 28.426(5); MSA 28.93(5). This information is no less private, intimate, or potentially embarrassing because it concerns state legislators or other public officials.
The safety concerns the Supreme Court noted in Mager apply here with even greater force. In contrast to what was required of gun registrants in Mager, persons applying for a concealed weapons permit must state on the application a safety concern that they feel justifies carrying a concealed weapon. MCL 28.426; MSA 28.93. That requirement applies to public officials, who enjoy no special status under the statute with regard to possession of a concealed weapon. Disclosure, pursuant to an FOIA request, could create a danger even greater than that created by disclosure of public information regarding who owns a gun, as in Mager. While mere gun ownership might reveal a generalized safety concern, concealed weapons applicants must specify exactly why they feel at risk, thus potentially placing themselves even *317 more in jeopardy. Again, the public officials whose privacy is at issue in the present case have the same right as other citizens to the protection recognized by the Mager Court.[5]
Plaintiff argues that concealed weapons licensing boards (gun boards) are subject to the Open Meetings Act, M.C.L. § 15.261 et seq.; MSA 4.1800(11) et seq., and that, therefore, the identities of concealed weapons permits applicants are disclosed during the permitting process. Defendants disagree, arguing that the Open Meetings Act permits closed sessions to consider information exempt from disclosure by statute, M.C.L. § 15.268(h); MSA 4.1800(18)(h), and that the identity of individual applicants is, in fact, protected from disclosure during the permitting process. Further, defendants argue that the "Federal Privacy Act," for which they provide no citation, applies to protect information on the concealed weapons permit application. In any event, regardless of the legal requirements that might affect disclosure during the permitting process, the record is not clear in this case with regard to whether disclosure actually occurred with respect to the persons whose identities would be revealed through compliance with plaintiff's requests. In the absence of that record, we cannot conclude that the privacy interest of the public officials involved here has already been relinquished[6] and that, accordingly, the protections otherwise afforded by the § 13 exemption do not apply.
We next turn to the question whether disclosure of this personal information would be a "clearly unwarranted invasion of an individual's privacy" under subsection 13(1)(a) of the FOIA. M.C.L. § 15.243(1)(a); MSA 4.1801(13)(1)(a).[7] This involves balancing the public interest in disclosure against the privacy interest the § 13 exemption seeks to protect. Mager, supra at 145, 595 N.W.2d 142. "`[T]he only relevant public interest in disclosure to be weighed in this balance is the extent to which disclosure would serve the core purpose of the FOIA, which is contributing significantly to public understanding of the operations or activities of the government.'" Id., quoting United States Dep't of Defense v. Federal Labor Relations Authority, 510 U.S. 487, 495, 114 S. Ct. 1006, 127 L. Ed. 2d 325 (1994) (emphasis in original). As stated in the Michigan FOIA,
[i]t is the public policy of this state that all persons ... are entitled to full and complete information regarding the affairs of government and the official acts of those who represent them as public officials and public employees, consistent with this act ... so that they may fully participate in the democratic process. [MCL 15.231(2); MSA 4.1801(1)(2).]
We have already described one side of the balance, the privacy concerns that the *318 § 13 exemption would protect if applied in this case. To reiterate, information regarding concealed weapons permits sought by or held by public officials is an intimate and potentially embarrassing detail of their personal life, the disclosure of which might result in safety concerns. We must consider whether that side of the balance is outweighed here by determining the extent to which the "core purpose" and "public policy" underlying the FOIA would be served through disclosure of the requested information.
We conclude that the public interest in disclosure of the information sought from the Department of State Police is minimal, at best, under these standards. Michigan state legislators who apply for a concealed weapons permit are exercising a right guaranteed to all Michigan citizens. Their decisions to seek a permit, or their receipt of one, might be related to their jobs in government but then only tangentially, for example, if safety concerns arise out of their public figure status. Information regarding concealed weapons permits would do nothing to illuminate the public's understanding of the "operations or activities" or "affairs" of government in which legislators are involved. Whether a legislator has applied for or received a concealed weapons permit has nothing whatsoever to do with whether that legislator is ably representing constituents, knowledgeably voting on issues, honestly reporting office expenditures, or otherwise fulfilling the duties of public service. Although plaintiff relies on cases like Booth Newspapers, supra, and Bradley, supra, those precedents "have given access to information regarding the manner in which public employees are fulfilling their public responsibilities. Mager, supra at 142-143, 595 N.W.2d 142 (emphasis supplied). As pointed out by the trial court here, these cases involve requests for information such as work personnel files, written performance evaluations, and travel logs. In contrast to this kind of information, the information plaintiff seeks from the Michigan State Police here does not regard, in any fashion, the manner in which public employees are fulfilling their public responsibilities.
The Free Press argues that the place of guns in our society is highly controversial and, of course, we readily agree. However, that is not automatically enough to tip the balance in favor of the public's interest in disclosure.[8] We see no way that knowledge about legislators' concealed weapons permits would better enable the citizenry to understand the debate regarding guns or the votes that legislators cast on bills relating to that debate. Even without the disclosures the Free Press seeks, legislators must publicly vote on gun regulation proposals and be ready to explain the positions they take to the citizens they represent. Information regarding their own personal concealed weapons status would add nothing of value to that process.
In contrast, with respect to the defendant county clerks, information about concealed weapon permits can conceivably assist the public in understanding the operations, activities, and affairs of local gun boards. The Free Press argues that people have a right to know whether public officials are treated more favorably than others by gun boards and we agree that this is a legitimate concern.
*319 That concern can be addressed, however, without identifying the individuals who have sought a concealed weapons permit. Instead, it is sufficient for the county clerks to delete information that would identify applicants while, to the extent possible in that process, leaving intact information that might indicate their status as public officials. This tailored approach would fulfill the goals of the FOIA without any clearly unwarranted invasion of the privacy of elected officials. See M.C.L. § 15.244(1); MSA 4.1801(14)(1).
It appears from the record that defendant county clerks have already acquiesced to disclosing nonexempt information in this fashion. As the Free Press concedes in its brief, in their responses to the FOIA requests, both the Ingham County Clerk and the Wayne County Clerk agreed to provide information subject to this limitation.
We conclude that, all the defendants having responded appropriately to plaintiff's FOIA requests, the trial court appropriately dismissed this case by granting summary disposition to defendants.
We affirm.
NOTES
[1] Defendants initially argue that, because of a previous, similar FOIA lawsuit involving the same parties, see Detroit Free Press, Inc. v. Dep't of State Police, 233 Mich.App. 554, 593 N.W.2d 200 (1999), the doctrines of collateral estoppel, res judicata, and the law of the case apply to bar this appeal. However, the lower court did not consider these issues and, ordinarily, our review is limited to issues decided below. Chilingirian v. City of Fraser, 194 Mich.App. 65, 70-71, 486 N.W.2d 347 (1992), remanded on other grounds 442 Mich. 874, 500 N.W.2d 470 (1993). Further, as plaintiff points out, the doctrines of res judicata and collateral estoppel are inapplicable here because the Supreme Court's decision in Mager established a new legal context for consideration of the merits of this appeal, different from that available to the lower court in reaching the decision that defendants argue bars this action. Regarding the law of the case argument made by defendants, this Court's decision in Detroit Free Press, supra at 559, n. 1, 593 N.W.2d 200, specifically stated that the Court did not "express an opinion on the merits" of the issues presented there.
[2] In granting defendants' motion for summary disposition, the trial court did not address the import of this revised request. Without considering whether the Free Press properly amended its FOIA request in this fashion, we will consider the merits of the arguments presented as applicable to the narrowed request.
[3] As the Supreme Court noted, Herald Co, supra at 118, n. 5, 614 N.W.2d 873, the version of the FOIA quoted in its opinion was a predecessor to the current version, on which the parties rely in this case. There has been no substantive change to the provisions quoted in Herald Co.
[4] We come to this conclusion realizing that Mager explicitly noted that it was not considering information regarding concealed weapons permits. Mager, supra at 135, n. 2, 595 N.W.2d 142. We conclude that the Mager Court was merely clarifying the issue under consideration, not suggesting that a different result would apply in a concealed weapons permit case.
[5] And, as defendants point out, disclosing the names of persons granted concealed weapons permits would, in effect, disclose the names of persons who own guns, contrary to Mager.
[6] We do not address here the issue whether public disclosure of information during the concealed weapons permitting process would eliminate the protection of the FOIA privacy exemption with regard to a later disclosure of that same information from some other source. We note, however, that, in a similar context, the United States Supreme Court has reasoned that it does not, concluding that "[a]n individual's interest in controlling the dissemination of information regarding personal matters does not dissolve simply because that information may be available to the public in some form ." United States Dep't of Defense v. Federal Labor Relations Authority, 510 U.S. 487, 500, 114 S. Ct. 1006, 127 L. Ed. 2d 325 (1994).
[7] Plaintiff argues that we must first examine whether defendants would have an actionable claim for invasion of privacy at common law. We reject that approach, because it was not the approach followed in Mager. Further, we note that the Supreme Court has stated that, although the common law might be helpful in analyzing the FOIA's "invasion of privacy" exemption, the scope of privacy protected by the FOIA "may not be coextensive" with the protection afforded by the common law. Swickard, supra at 547, 475 N.W.2d 304.
[8] If a public controversy was alone sufficient to warrant disclosure, all manner of information might be targeted by FOIA requests. For example, a debate between optometrists and ophthalmologists regarding legislation to change the scope of their licenses might prompt requests for legislators' medical or health insurance records to determine which of these eye specialists provides care for whom. A legislative battle between competing telephone carriers might prompt FOIA requests for records that might indicate which legislators use which service. These examples are perhaps not sufficiently "of a personal nature" to meet the § 13 exemption but they illustrate the problems attendant to plaintiff's broad understanding of what would warrant an invasion of privacy under that section. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2985256/ | December 17, 2013
JUDGMENT
The Fourteenth Court of Appeals
PHILLIP BRANDON ADKINS, Appellant
NO. 14-12-00956-CR V.
THE STATE OF TEXAS, Appellee
________________________________
This cause was heard on the transcript of the record of the court below.
Having considered the record, this Court holds that there was no error in the
judgment. The Court orders the judgment AFFIRMED.
We further order appellant pay all costs expended in the appeal.
We further order this decision certified below for observance. | 01-03-2023 | 09-23-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1174029/ | 98 Wash. 2d 775 (1983)
658 P.2d 663
RAYMOND ARMENT, ET AL, Appellants,
v.
WILLIAM E. HENRY, ET AL, Respondents.
No. 47957-7.
The Supreme Court of Washington, En Banc.
February 10, 1983.
As amended by order April 20, 1983.
*776 Robert Adelman and John Midgley of Evergreen Legal Services, for appellants.
Kenneth O. Eikenberry, Attorney General, and Michael P. Lynch, Assistant, for respondents.
[As amended by order of the Supreme Court April 20, 1983.]
DOLLIVER, J.
Plaintiffs were inmates at the Washington State Corrections Center in Shelton at the time of the "New Year's Riot" in 1981. All are indigent. Each was informed on March 18, 1981, he was scheduled to see the Board of Prison Terms and Paroles for a disciplinary hearing in April. The notices described the charges and stated if the inmate was found guilty, the Board could redetermine the inmate's minimum term and revoke any or all good time credits earned or to be earned. The notices further provided, "You may have an attorney of your choice represent you at the hearing, at your expense.... The law does not provide the authority for the Board to ... pay any attorney fees".
On March 24, plaintiffs formally requested appointment of counsel. The requests were denied. On March 27, plaintiffs brought the present action on behalf of themselves and all others similarly situated to compel the Board to appoint counsel. They also sought to prohibit the Board from holding disciplinary hearings without offering to appoint counsel for indigent inmates.
On April 2, the trial court entered an interim order which permitted the Board to hold the scheduled disciplinary hearings without providing counsel for plaintiffs, and which also provided safeguards for the plaintiffs should they prevail on their claim of right to counsel. The hearings were held as scheduled, and the minimum term of each plaintiff was lengthened by 3 years.
Both sides then filed cross motions for summary judgment. *777 Steve Scott, Director of Institutional Legal Services Project, filed an affidavit in support of the plaintiffs' motion. Scott stated that after Monohan v. Burdman, 84 Wash. 2d 922, 530 P.2d 334 (1975) was decided, Institutional Legal Services Project represented all indigent inmates at Parole Board disciplinary hearings, but subsequent decreases in funding made this service no longer possible. Scott, who had represented many inmates at disciplinary hearings, said that an attorney's presence is very useful to an inmate, especially in establishing mitigating factors, exigencies, and rehabilitative factors. He further stated that, from his experience, proof of such factors often resulted in a technically guilty inmate not receiving a lengthened minimum term.
The trial court granted the Board's motion for summary judgment. The court held the constitution does not require the State to provide counsel for indigent inmates in disciplinary hearings. The plaintiffs' action has not yet been certified as a class action under CR 23.
The sole issue in this appeal is whether the Board of Prison Terms and Paroles is constitutionally required to appoint counsel for an indigent inmate before increasing the inmate's minimum sentence at a disciplinary hearing held pursuant to RCW 9.95.080.
Initially, we must distinguish various types of hearings. The hearings in this case were not parole revocation hearings, see RCW 9.95.120-.126, nor were they the type of institutional disciplinary hearings contemplated by WAC 275-88-005 through WAC 275-88-130. They were hearings under RCW 9.95.080, which states:
In case any convicted person undergoing sentence in the penitentiary, reformatory, or other state correctional institution, commits any infractions of the rules and regulations of the institution, the board of prison terms and paroles may revoke any order theretofore made determining the length of time such convicted person shall be imprisoned, including the forfeiture of all or a portion of credits earned or to be earned, pursuant to the provisions of RCW 9.95.110, and make a new order determining the *778 length of time he shall serve, not exceeding the maximum penalty provided by law for the crime for which he was convicted, or the maximum fixed by the court. Such revocation and redetermination shall not be had except upon a hearing before the board of prison terms and paroles. At such hearing the convicted person shall be present and entitled to be heard and may present evidence and witnesses in his behalf.
The sanctions which may be imposed under an RCW 9.95.080 Parole Board disciplinary hearing are far more serious than those prescribed under institutional disciplinary hearings. See WAC 275-88-105. Plaintiffs contend that because of the possible severity of the sanctions under RCW 9.95.080 they are entitled as a matter of constitutional right to counsel in an RCW 9.95.080 proceeding.
[1] The case law can be stated succinctly: (1) Some minimum due process is required in probation or parole revocation hearings. Morrissey v. Brewer, 408 U.S. 471, 489, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972); Wolff v. McDonnell, 418 U.S. 539, 41 L. Ed. 2d 935, 94 S. Ct. 2963 (1974); and Monohan v. Burdman, 84 Wash. 2d 922, 530 P.2d 334 (1975). (2) There is no constitutional requirement in probation or parole revocation hearings that in all cases indigent prisoners must be provided with counsel, but exceptions are available on a case-by-case basis. Gagnon v. Scarpelli, 411 U.S. 778, 36 L. Ed. 2d 656, 93 S. Ct. 1756 (1973). (3) A lesser standard of due process is required in disciplinary proceedings when a prisoner is already incarcerated rather than on probation or parole. Not only is the sanction in prison disciplinary hearings "qualitatively and quantitatively different from the revocation of parole or probation" but the State also has a far different stake in prison disciplinary hearings than in the revocation of probation or parole. Wolff v. McDonnell, supra at 561-62.
In Vitek v. Jones, 445 U.S. 480, 496-97, 63 L. Ed. 2d 552, 100 S. Ct. 1254 (1980), the Supreme Court stated:
We have not required the automatic appointment of counsel for indigent prisoners facing other deprivations of liberty, Gagnon v. Scarpelli, 411 U.S., at 790; Wolff v. *779 McDonnell, 418 U.S., at 569-570; but we have recognized that prisoners who are illiterate and uneducated have a greater need for assistance in exercising their rights. Gagnon v. Scarpelli, supra, at 786-787; Wolff v. McDonnell, supra, at 570. A prisoner thought to be suffering from a mental disease or defect requiring involuntary treatment probably has an even greater need for legal assistance, for such a prisoner is more likely to be unable to understand or exercise his rights. In these circumstances, it is appropriate that counsel be provided to indigent prisoners whom the State seeks to treat as mentally ill.
See United States v. DeRobertis, 508 F. Supp. 360 (N.D. Ill. 1981).
In Monohan v. Burdman, supra, relied upon by plaintiffs, Monohan alleged a tentative parole release date given him while in the Washington State Corrections Center was canceled without appropriate notice and an adjudicatory hearing. He had been on furlough pursuant to RCW 72.66 to undertake development of a parole plan in his home community when he allegedly became involved in a drug oriented party and was charged with disorderly conduct. On the same day Monohan was returned to the Corrections Center the authorities there were advised all charges had been dismissed. The court posed the issue as follows:
The precise question posed here is whether the right of minimal due process hearings, as guarantied to probationers and parolees under Gagnon v. Scarpelli, supra, and Morrissey v. Brewer, 408 U.S. 471, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972), should be accorded to proceedings leading up to the cancellation of a previously established, tentative parole release date for reasons other than inability to develop an acceptable parole rehabilitation plan. As we have indicated, we believe it should.
Monohan, at 926. In contrast to Monohan, the hearings in this case were for the discipline of infractions which occurred within the prison.
Plaintiffs urge us to adopt a per se rule for right of counsel in RCW 9.95.080 disciplinary hearings. This we refuse to do. As we have pointed out no such requirement is made by *780 the United States Supreme Court even in probation or parole revocation hearings. Although Monohan held minimal due process hearings were required in the circumstances of that case which involved parole rescission, the court did not list right to counsel in its catalog of minimum due process requirements. Right of counsel is conspicuous by its absence. Monohan v. Burdman, supra at 930.
Even though the penalties may be severe, the hearing under RCW 9.95.080 is essentially an informal procedure (compare RCW 9.95.080 and Board of Prison Terms and Paroles rule 4.070(4), State Register XX-XX-XXX (1982), with RCW 9.95.120-.126). This hearing need not have the "full range of procedures suggested by Morrissey for alleged parole violators". Wolff v. McDonnell, supra at 561. The same rationale articulated in Wolff v. McDonnell is applicable here:
The reality is that disciplinary hearings and the imposition of disagreeable sanctions necessarily involve confrontations between inmates and authority and between inmates who are being disciplined and those who would charge or furnish evidence against them. Retaliation is much more than a theoretical possibility; and the basic and unavoidable task of providing reasonable personal safety for guards and inmates may be at stake, to say nothing of the impact of disciplinary confrontations and the resulting escalation of personal antagonisms on the important aims of the correctional process.
Indeed, it is pressed upon us that the proceedings to ascertain and sanction misconduct themselves play a major role in furthering the institutional goal of modifying the behavior and value systems of prison inmates sufficiently to permit them to live within the law when they are released. Inevitably there is a great range of personality and character among those who have transgressed the criminal law. Some are more amenable to suggestion and persuasion than others. Some may be incorrigible and would merely disrupt and exploit the disciplinary process for their own ends. With some, rehabilitation may be best achieved by simulating procedures of a free society to the maximum possible extent; but with others, it may be essential that discipline be swift *781 and sure. In any event, it is argued, there would be great unwisdom in encasing the disciplinary procedures in an inflexible constitutional straitjacket that would necessarily call for adversary proceedings typical of the criminal trial, very likely raise the level of confrontation between staff and inmate, and make more difficult the utilization of the disciplinary process as a tool to advance the rehabilitative goals of the institution.
(Footnote omitted.) Wolff v. McDonnell, supra at 562-63.
The proceeding here is comparable to the proceeding in Wolff v. McDonnell. It is a hearing to determine and sanction misconduct within the prison. We hold due process does not require a right of counsel in an RCW 9.95.080 hearing.
In addition to their due process contentions, plaintiffs also claim a violation of the equal protection clauses of the state and federal constitutions. Board of Prison Terms and Paroles rule 4.070(4) provides:
[The inmate] will have the right to have an attorney present, but at his own expense since the Board has no funds to pay for attorneys, witness fees, the cost of subpoenaes or any other related costs that may be incurred by the inmate.
State Register XX-XX-XXX (1982), at 24.
Plaintiffs rely on Dillenburg v. Morris, 84 Wash. 2d 353, 525 P.2d 770 (1974), which involved an on-site parole revocation hearing. In a parole revocation hearing RCW 9.95.122 permits an alleged parole violator "to be represented by an attorney of his own choosing and at his own expense". It also allows counsel for an indigent alleged violator, "Provided, That funds are available for the payment of attorneys' fees and expenses." RCW 9.95.122. The court held the statute violated state and federal operation of equal protection under the law.
[2] Dillenburg is distinguishable. Here the statute in question, RCW 9.95.080, in contrast to RCW 9.95.122, does not provide for any right of representation by counsel at disciplinary hearings. Rather than being controlled by Dillenburg, the case before us is analogous to Ganz v. Bensinger, *782 480 F.2d 88 (7th Cir.1973) and Cruz v. Skelton, 543 F.2d 86 (5th Cir.1976). In Ganz the claim was a constitutional right to have appointed counsel at a parole release hearing while Cruz involved the right of counsel at a parole application proceeding. In both cases there was an agency similar to the Board of Prison Terms and Paroles. Each agency had adopted a rule relative to counsel for an inmate. In both cases the agency rules failed to provide counsel for the indigent. The rule in Ganz stated "relatives, friends and counsel for the prisoners may attend and be heard in behalf of the prisoners whose names appear on the docket, as well as persons who desire to protest the release of the prisoners." Ganz, at 90 n. 4, quoting Illinois Pardon and Parole Board rule 8. In Cruz the agency rule stated, "`Any interested person or members of the family may appear before the Board on behalf of an inmate with or without legal counsel.'" Cruz, at 95, quoting Rules and Regulations, Texas Department of Corrections, § 7.6 (1973). The rule of the Washington Parole Board simply provides the "prisoner will have the right to have an attorney present". Board of Prison Terms and Paroles rule 4.070(4).
The court in Ganz observed,
even if the presence of counsel may be desirable at parole release hearings, a lawyer is not indispensable to the effective conduct of such hearings.... [T]his rule of the Illinois Parole Board, in the words of Justice Frankfurter, does not "make lack of means an effective bar to the exercise" of the indigent's opportunity to obtain parole.
Ganz, at 90. Judge Stevens (now Justice Stevens) writing for the court stated:
the Equal Protection Clause does not require the Illinois Pardon and Parole Board either (1) to repeal its rule permitting inmates to have the assistance of counsel, or (2) to provide such assistance for all inmates at state expense.
Ganz, at 91.
The court in Cruz stated,
[t]he informal, unstructured procedures for considering *783 parole application to the Texas Board of Parole do not present a forum in which the special analytical, research or forensic skills of the lawyer are necessary, nor even likely to prove particularly helpful. Cf. Gagnon v. Scarpelli, 1973, 411 U.S. 778, 93 S. Ct. 1756, 36 L. Ed. 2d 656. We reject the contention that the Texas procedure operates to deny a meaningful and fair consideration by the Board of Parole application of an indigent prisoner because he is unable to afford counsel. Ganz v. Bensinger, supra.
(Footnote omitted.) Cruz, at 96.
We concur in the reasoning of Ganz and Cruz and hold the Board of Prison Terms and Paroles is not required under the equal protection clause of the United States and Washington Constitutions either to repeal its rule permitting counsel to be present at a disciplinary hearing or to provide counsel for indigent inmates at State expense.
Affirmed.
WILLIAMS, C.J., and ROSELLINI, STAFFORD, BRACHTENBACH, DIMMICK, and PEARSON, JJ., concur.
DORE, J. (dissenting)
The Board of Prison Terms and Paroles (Board) should be constitutionally required to appoint counsel for an indigent inmate before increasing the inmate's minimum sentence at a disciplinary hearing held pursuant to RCW 9.95.080. I would reverse.
Though the State is not constitutionally obligated to provide counsel in all cases, it should do so where the indigent probationer or parolee may have difficulty in presenting his version of disputed facts without the examination or cross examination of witnesses or the presentation of complicated documentary evidence. Gagnon v. Scarpelli, 411 U.S. 778, 36 L. Ed. 2d 656, 93 S. Ct. 1756 (1973), interpreting the due process protection afforded in probation or parole revocation hearings under Morrissey v. Brewer, 408 U.S. 471, 489, 33 L. Ed. 2d 484, 92 S. Ct. 2593 (1972).
The majority maintains a Board hearing under RCW 9.95.080 is analogous to the in-system disciplinary hearing *784 described in Wolff v. McDonnell, 418 U.S. 539, 41 L. Ed. 2d 935, 94 S. Ct. 2963 (1974). In Wolff, the prison inmates were faced with possible withholding of "good-time credits" for alleged misconduct within the institution. The Court held the inmates had no right to retained or appointed counsel in such proceedings, although counsel substitutes should be provided in certain cases. The majority apparently bases its analogy to Wolff on these premises: (1) the loss suffered by an inmate at a Board disciplinary hearing is no greater than that of an inmate losing "good-time credits" and (2) Board disciplinary hearings are not contested cases like parole revocations of Morrissey, but are merely behavioral adjustment tools as in Wolff, and the insertion of counsel would change the nature of the hearings. I cannot accept this misguided logic.
The majority confuses the Board's power not to certify good time with its ability to take away future good time. The two functions are controlled by different statutes, have considerably different impacts on the individual and, appropriately enough, invoke different due process considerations. The only statute that authorizes the Board to take away future good time is RCW 9.95.080. In Monohan v. Burdman, 84 Wash. 2d 922, 530 P.2d 334 (1975), this court held that the right of minimal due process hearings, such as were guaranteed to probationers and parolees under Gagnon and Morrissey, should be accorded to proceedings under RCW 9.95.080 leading up to the cancellation of a previously established tentative parole release date for reasons other than inability to develop an acceptable parole rehabilitation plan.
The majority confuses the obligation of the Board under RCW 9.95.080 with the powers conferred upon it under RCW 9.95.070, the type of statute under consideration in Wolff. RCW 9.95.070 allows the Board to certify past good time in an effort to adjust inmates' daily behavior, and is far different from RCW 9.95.080, which seeks to severely punish inmates for serious infractions. The Board may not take away future good time absent a hearing pursuant to *785 RCW 9.95.080.
The disciplinary hearings in the present case are quasi-judicial adversary hearings akin to the parole revocation hearings in Morrissey. The potential loss suffered by the inmates here is far greater than that imposed upon the inmates in Wolff. The majority in fact concedes "[t]he sanctions which may be imposed under an RCW 9.95.080 Parole Board disciplinary hearing are far more serious than those prescribed under institutional disciplinary hearings. See WAC 275-88-105." Majority opinion, at 778. Additionally, the term of imprisonment may be extended only after discrete factual findings. The Board itself acknowledged the adversary nature of the disciplinary proceedings when it adopted Board rule 4.070(4), which allows inmates who can afford counsel to be represented.
The same rationale we articulated in Monohan is applicable here:
We pause to observe, as have several other courts, that the initial fixing of a tentative parole release date is of a discretionary nature and does not involve a due process hearing.... However, as we have noted, once parole or a promise of parole has been granted in the form of a tentative release date, we are satisfied that the prospective parolee enjoys a unique status and is deserving of minimal due process safeguards before cancellation of that date for reasons other than failure to develop an adequate rehabilitation plan.
(Italics mine.) Monohan, at 929.
The right to counsel is required "when procedural fairness demands it." Tetro v. Tetro, 86 Wash. 2d 252, 253, 544 P.2d 17 (1975). Without counsel, the inmates here are left alone to prepare a defense against a charge of rioting that occurred almost 100 miles away. The majority in effect expects these young inmates, who never even graduated from high school, to present their versions of a disputed set of facts where the presentation requires the examining and cross-examining of witnesses and the offering or dissecting of complex documentary evidence, all without benefit of counsel. This is precisely the situation where procedural *786 fairness demands the right to counsel.
I would reverse.
UTTER, J., concurs with DORE, J.
Reconsideration denied April 20, 1983. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1501667/ | 605 S.W.2d 665 (1980)
Daryl Glenn LOTT, Appellant,
v.
Claudia E. LOTT, Appellee.
No. 20181.
Court of Civil Appeals of Texas, Dallas.
August 6, 1980.
Rehearing Denied September 24, 1980.
*666 Philip R. Russ, Dallas, for appellant.
Michael F. Pezzulli, Kelsoe & Ayres, Dallas, for appellee.
*667 Before GUITTARD, C. J., and AKIN and HUMPHREYS, JJ.
HUMPHREYS, Justice.
Daryl Glenn Lott appeals from a divorce decree appointing his ex-wife, Claudia E. Lott, managing conservator of their child, and ordering child support. He also contends that his motion to disqualify appellee's counsel should have been granted, and that the court erred in entering a judgment nunc pro tunc without hearing evidence after it had granted appellant's motion for new trial. We affirm.
Eleven days after the original divorce decree was entered on June 15, 1979, appellant filed a motion for new trial or to set aside the judgment. A hearing on this motion was heard by a judge other than the one who tried the case. The hearing was held on July 13th, the thirtieth day after final judgment was rendered. At that hearing, appellant repeatedly informed the court that he was only asking the court to enter a corrected judgment, reciting that appellant did not announce ready for trial and changing the property division in certain respects. He asserted that he only wanted the court to set aside the judgment, and that it would not be necessary to retry the case. At the end of the hearing the judge stated, "[t]he court is going to grant the motion to set aside." The order signed on that day, however, grants a new trial. After the judge who heard the case returned, he signed a "Decree of Divorce Nunc Pro Tunc" on August 9, 1979, which amended the original decree only by stating that appellant had announced not ready for trial.
On appeal appellant contends that this judgment "nunc pro tunc" is void because the court did not hear evidence after it granted the motion for new trial. Appellee counters that appellant is estopped from arguing this point because of his assertions to the judge at the hearing on the motion for new trial that a new trial would not be necessary. We agree with appellee. After appellant argued to the trial court that if his motion was granted a new trial would not be necessary, and obtained a ruling based upon this assertion, he cannot change his position. A party who takes a position successfully in a judicial proceeding cannot then take an inconsistent position, especially if his adversary is thereby prejudiced. See May v. Wilcox Furniture Downtown, Inc., 450 S.W.2d 734, 739 (Tex.Civ.App.-Corpus Christi 1969, writ ref'd n.r.e.); Lobit v. Crouch, 323 S.W.2d 618, 620 (Tex.Civ. App.-Austin 1959, writ ref'd n.r.e.); Marvin v. Pierson, 115 S.W.2d 712, 713 (Tex.Civ. App.-Dallas 1938, writ dism'd). Appellee would be prejudiced if the second decree is declared void because a new trial would then be necessary. Consequently, appellant's argument that the decree is not valid because no evidence was taken prior to its rendition is overruled.
Appellant argues that if he is estopped from arguing that the court should have taken evidence prior to entry of this second judgment, then appellee is estopped from arguing that the "Decree of Divorce Nunc Pro Tunc" is valid. He bases this contention on the fact that appellee, prior to filing her brief in this court, in response to questions from this court, stated in a latter brief to the court that this second judgment was not valid. We cannot agree that appellee is estopped to assert that the judgment is valid. This action was not dismissed by the court pursuant to her contention. Therefore, she did not successfully maintain one position and then change her position in a subsequent proceeding. In appellee's brief filed with this court, and at oral argument, she contended the decree was indeed valid, and that she was mistaken in her earlier statement to the court that it was not. Appellant argues that he was prejudiced by this statement because he did not bring forward several points of error which he would have presented. As this court has now allowed appellant to raise these contentions in a supplemental brief, appellant has not been prejudiced.
We next consider appellant's arguments concerning his motion to disqualify appellee's counsel. At a hearing on this motion, appellant testified that he had employed *668 the law firm of Kelsoe and Ayres to represent him in a lawsuit against Reproductive Services, Inc., and that subsequently, he and his wife both employed them in that suit. About this time appellee, represented by Kelsoe and Ayres, filed suit for divorce from appellant. Although appellant later testified that he never received a copy of the letter, he admitted that he saw a letter from the firm of Kelsoe and Ayres saying that they could no longer represent him in the suit against Reproductive Services, Inc. Appellant later intervened in that suit. He now argues that the trial court erred in not granting his motion to disqualify counsel because the above facts reveal a conflict of interest. In particular, he relies on the Code of Professional Responsibility, Canon 9 of the American Bar Association, which provides that an attorney shall avoid even the appearance of impropriety.
The rule is that the attorney shall be disqualified from representing a client when the adverse party is a former client, if the matter in which he represented the former client is "substantially related" to the present action. Westinghouse Electric Corp. v. Gulf Oil Corp., 588 F.2d 221, 223 (7th Cir. 1978); Howard Hughes Medical Institute v. Lummis, 596 S.W.2d 171, 174 (Tex.Civ.App.-Houston [14th Dist.] 1980, no writ). On this record, we cannot say that the two actions are substantially related. The pleadings in the suit against Reproductive Services, Inc. were not admitted into evidence. All the record discloses is that the action against Reproductive Services, Inc. was for personal injuries to appellee. In the divorce decree, the court awarded appellee the proceeds of that claim as her separate property, and appellant was awarded the amount of his claim in intervention as his separate property.
Appellant argues that the suits are related because appellee changed her pleadings in the Reproductive Services, Inc. action from a claim for treble damages under the Deceptive Trade Practices Act, Tex.Bus. &Com. Code Ann. §§ 17.41-17.63 (Vernon Supp. 1980), to a claim only for negligence, thereby changing the proceeds from community property to her separate property. The record of this hearing, however, does not reflect this fact. While there may be the appearance of impropriety here, it is not sufficient to warrant the disqualification of the attorney. We therefore, sustain the action of the trial court in overruling this motion for disqualification.
Appellant next attacks the divorce decree in several respects. His first argument is that there is no evidence, or insufficient evidence, that appellee had been a resident of the state of Texas for six months preceding the filing of the divorce action. Tex.Fam.Code Ann. § 3.21 (Vernon 1973) provides that no suit for divorce may be maintained unless the petitioner or the respondent has been a domiciliary of the state for the six-month period preceding the time the suit was filed. One of the parties must also have been a resident of the county for the preceding ninety-day period. The trial court found that the residential qualifications had been met.
Appellee testified that she had lived in Dallas County for six months prior to the filing of the divorce in September 1978. She also testified that she lived with her parents for a few months in California, and was there in January and February of 1978, and that she "came back, and [she] lived in Oklahoma for a while" with appellant. She came back from Oklahoma in August 1978.
Temporary absences from the county or the state will not affect the right of a party to maintain an action for divorce. Posey v. Posey, 561 S.W.2d 602, 605 (Tex.Civ.App.-Waco 1978, writ dism'd); Stacy v. Stacy, 480 S.W.2d 479, 482 (Tex.Civ.App.-Waco 1972, no writ); Meyer v. Meyer, 361 S.W.2d 935, 938 (Tex.Civ.App.-Austin 1962, writ dism'd). We cannot determine from this record how long appellee was in Oklahoma or California. When appellee testified that Texas was her residence, the fact that she lived in California and Oklahoma for brief periods of time does not require reversal of the court's finding that she had established residence in Texas.
*669 Appellant also attacks the portion of the decree in which the court found that it was in the best interest of the child to appoint appellee managing conservator. He contends the evidence is insufficient to sustain this finding. We first note that appellant did not even request the court to appoint him managing conservator. Appellee testified that she wanted the child and that she believed she was competent to take care of the child, and appellant did not testify to the contrary. Appellant argues that appellee's testimony that she goes out on dates and leaves the child with her parents bears unfavorably on her fitness as a mother. In this connection, he argues that the trial court erred in not allowing him to ask appellee if she left the child with her parents overnight. We cannot agree that even an affirmative answer to this question would require us to reverse this finding. A trial court's finding of best interests of the child will not require reversal unless there has been a clear abuse of discretion. Herrera v. Herrera, 409 S.W.2d 395, 396 (Tex. 1966); In re Marriage of Stockett, 570 S.W.2d 151, 153 (Tex.Civ.App.-Amarillo 1978, no writ). On this record, there is no abuse, especially in light of the fact that appellant did not request custody of the child.
Appellant's last argument is that the evidence does not support the court's award of child support in the amount of $60 per week for sixty-seven weeks, and then $45 per week until the child reaches eighteen. Appellant testified that she had no income, that her father paid for rent and clothes, and that she had not worked for seven months prior to the trial. Although she had made only one attempt to find a job during this time, she testified that she did not have transportation to work and that day care for her child and other expenses which would have to be paid if she worked amounted to more than she could make. Her expenses include $200 a month for rent, $100 a month to feed the child, and $25 a month to clothe the child. Appellant testified that the temporary order of child support of $275 a month was hardship on him. At the time of trial he was in jail for non-payment of his temporary support. He stated further that he had lost his job when he was jailed and that he had no other income or credit. He thought that he could return to his job after leaving jail, however, at a net rate of pay of $200 a week.
The trial court's decision on support cannot be overturned unless it constitutes a clear abuse of discretion. We cannot substitute our findings for the court's unless this abuse is shown. Labowitz v. Labowitz, 542 S.W.2d 922, 924 (Tex.Civ.App.-Dallas 1976, no writ). The evidence shows that appellee has a need for money to support her child and that appellant has an income of at least $800 a month. An award of $240 a month child support is not so unreasonable as to constitute an abuse of discretion.
Accordingly, we affirm. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1789047/ | 636 So. 2d 1153 (1994)
Keith P. CENTANNI, Plaintiff-Appellant,
v.
FORD MOTOR COMPANY, et al., Defendants-Appellees.
No. 93-1133.
Court of Appeal of Louisiana, Third Circuit.
May 4, 1994.
Rehearing Denied June 20, 1994.
*1154 Keith James Labat, Thibodaux, for Keith P. Centanni.
James Michael Dill, Lafayette, for Ford Motor Co., et al.
Before GUIDRY, LABORDE, THIBODEAUX and SAUNDERS, JJ., and BERTRAND,[1] J. Pro Tem.
LABORDE, Judge.
Plaintiff seeks relief under LSA-R.S. 13:4232(A)(1) from the judgment by the trial court sustaining defendant's exception of res judicata. We affirm.
Facts
Plaintiff was allegedly injured in an automobile accident on April 18, 1990, in Jefferson Davis Parish. He filed two identical suits on April 17, 1991, naming as defendants his employer and Ford Motor Company. One suit was filed in Lafourche Parish, the parish of his employer. The other suit was filed in Jefferson Davis Parish. Plaintiff, opting to proceed with the Lafourche Parish suit, had Ford served with that suit only.
The Lafourche Parish suit against the employer was dismissed on summary judgment. As the injured worker's sole remedy against his employer was found to lie in workers compensation, LSA-R.S. 23:1032, dismissal of the employer destroyed venue as to Ford, whose exception on that basis was maintained.
The trial judge then permitted plaintiff to transfer his remaining claims to a proper venue. LSA-CCP art. 932. Plaintiff elected to transfer the suit to the 24th Judicial District Court in Jefferson Parish (Gretna), Louisiana. *1155 There, Ford immediately filed an exception of prescription.
The 24th District Court in Jefferson Parish granted the exception, dismissing plaintiff's suit against Ford with prejudice, because the Lafourche Parish suit was not served until after the prescriptive period had run. Plaintiff did not appeal this decision.
Subsequent to the deadline for appealing this Jefferson Parish (Gretna) judgment, plaintiff sought to awaken the long dormant and never served (Jennings) Jefferson Davis Parish action. In response, Ford filed an exception of res judicata seeking recognition of the judgment in Jefferson Parish.
The sole question on appeal is whether the Jefferson Davis Parish court properly sustained Ford's exception and dismissed plaintiff's action.
LAW AND ANALYSIS
In this case, there is no question that this action, the Jefferson Davis suit with which Ford was served, is now res judicata. Below its caption, the Jefferson Davis suit plaintiff now seeks to advance is a carbon copy of the one he failed to appeal in Jefferson Parish: same object; same causes of action; same parties sharing the same legal identity. Cf. Mitchell v. Bertolla, 340 So. 2d 287, 292 (La. 1976); State, Dept. of Social Serv. v. Coleman, 616 So. 2d 844 (La.App. 3d Cir.1993).
Where identical suits are filed in separate jurisdictions and defendants fail to raise an exception of lis pendens, "the plaintiff may continue the prosecution of any of the suits, but the first final judgment rendered shall be conclusive of all." LSA-CCP art. 531; Bunch v. Schilling Distributing Inc., 589 So. 2d 502 (La.App. 3d Cir.), writ denied, 592 So. 2d 1319 (La.1991). The grant of a peremptory exception of prescription constitutes a final judgment. Lee v. Champion Insurance Co., 591 So. 2d 1364 (La.App. 4th Cir.1991). A valid, final judgment in favor of the defendant is conclusive between the parties. It extinguishes all causes of action arising from the same transaction or occurrence that is the subject matter of the suit and bars similar subsequent actions unless the judgment is reversed on appeal. LSA-R.S. 13:4231(2); see also comment (d).
The question thus becomes whether plaintiff is of the class for whom LSA-R.S. 13:4232(A)(1) is designed to afford relief from the effects of res judicata for his failure to timely appeal the Jefferson Parish action.[2] The answer depends on whether "exceptional circumstances justify relief from the res judicata effect of the judgment" rendered in Gretna.[3]
We find no "exceptional circumstances," no convoluted factual or legal scenarioin fact, no circumstances of any kindto justify plaintiff's failure to appeal the Gretna judgment. The failure to appeal was not occasioned by some "horrendous injustice." Cf. Jenkins v. State, 615 So. 2d 405, 406-407 (La.App. 4th Cir.), writ denied, 617 So. 2d 932 (La.1993). LSA-R.S. 13:4232(A)(2) is designed to protect those drawn into error by an awkward factual or legal scenario, not by those who can allude to no circumstance to justify no action at all. Thus, we affirm the judgment below.
In doing so, we recognize that res judicata defenses require strict proof. Indeed, we would subscribe to the conclusion *1156 plaintiff espouses had Ford possessed knowledge of plaintiff's first action, which was timely filed, or had Ford acknowledged plaintiff's rights against it. See generally LSA-CC arts. 3462 (knowledge) and 3463 (acknowledgement), and Comments. Prescription statutes comfort potential parties defendant who do not know that litigation is pending against them from losses, and the fear of losses, that might otherwise arise from stale claims and from the loss of relevant proof; they are not designed to protect those who should know that litigation is pending against them. See generally Giroir v. South La. Medical Center, 475 So. 2d 1040, 1045 (La. 1985). In accord, Maquar v. Transit Management, 593 So. 2d 365, 368 (La.1992); Parker v. Southern American Ins. Co., 590 So. 2d 55, 56 (La.1991); Totty v. Dravo Corp., 413 So. 2d 684, 686 (La.App. 3d Cir.1982).
In this case, plaintiff has neither shown any justification for his failure to advance his case nor that defendant's knowledge of timely filed litigation precludes its ability to rely on prescription defenses. Further, plaintiff's failure to timely appeal that judgment, out of fairness to defendant, legally negates our authority to review a final judgment rendered in accordance therewith. The safety net provided by LSA-R.S. 13:4232(A)(1) is no substitute for a party's unjustified failure to apply for a new trial, file an appeal, or seek a nullity judgment, each of which were required to have been filed earlier (and elsewhere). For these reasons, we are compelled to affirm the finding of the lower court. Costs assessed to plaintiff-appellant.
AFFIRMED.
THIBODEAUX, J., dissents and assigns written reasons.
SAUNDERS, J., dissents for the reasons assigned by THIBODEAUX, J.
THIBODEAUX, Judge, dissenting.
I respectfully dissent.
The peculiar and somewhat convoluted factual environment of this case constitutes "exceptional circumstances [justifying] relief from the res judicata effect of the judgment." La.R.S. 13:4232(A)(1). As the Comments to that article indicate, a court is authorized to exercise its equitable discretion to grant relief under some circumstances. That discretion should be exercised in this case.
A liberal construction must be given to res judicata principles and all doubts must be resolved against the party urging the application of that theory. A plea of res judicata should not be sustained unless its application is clearly justified. State, Department of Social Services, in Interest of Sterling v. Coleman, 616 So. 2d 844 (La.App. 3d Cir. 1993).
Res judicata is remedial in character and should not be applied to prohibit the disposition of cases on their merits, whenever possible. Access to our courts should not be precluded because of procedural hypertechnicalities such as that which exist in this case. La. R.S. 13:4232(A)(1) was clearly intended as an equitable remedy to strike a proper balance between the conflicting principles that, on one hand, litigation must terminate at some point and, on the other hand, justice must be effectuated. While we recognize that sanctity of final judgments expressed in the notion of res judicata, we also recognize the command of our court's conscience that justice be done in light of all facts.
SAUNDERS, J., dissents for the reasons assigned by THIBODEAUX, J.
NOTES
[1] Judge Lucien C. Bertrand, Jr., Retired, participated in this decision as Judge Pro Tempore by appointment of the Louisiana Supreme Court.
[2] But for plaintiff's failure to appeal the judgment arising in another circuit, in all probability, the outcome would be different. See, e.g., Johnson v. Sweat, 265 So. 2d 801 (La.App. 3d Cir.), writ refused, 263 La. 105, 267 So. 2d 211 (1972).
[3] The provision provides as follows:
§ 4232. Exceptions to the general rule of res judicata
A. A judgment does not bar another action by the plaintiff:
(1) When exceptional circumstances justify relief from the res judicata effect of the judgment;
(2) When the judgment dismissed the first action without prejudice; or,
(3) When the judgment reserved the right of the plaintiff to bring another action.
B. In an action for divorce under Civil Code Article 102 or 103, in an action for determination of incidental matters under Civil Code Article 105, in an action for contributions to a spouse's education or training under Civil Code Article 121, and in an action for partition of community property and settlement of claims between spouses under R.S. 9:2801, the judgment has the effect of res judicata only as to causes of action actually adjudicated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1501665/ | 395 A.2d 404 (1978)
William J. ELLIS, Appellant,
v.
UNITED STATES, Appellee.
Michael D. BARNES, Appellant,
v.
UNITED STATES, Appellee.
Nos. 11558, 11641.
District of Columbia Court of Appeals.
Argued November 16, 1977.
Decided December 1, 1978.
*405 Ladd B. Leavens, Public Defender Service, Washington, D.C., for appellant Ellis. Silas J. Wasserstrom, Public Defender Service, Washington, D.C., also entered an appearance.
Richard E. Galen, Washington, D.C., appointed by the court, for appellant Barnes.
Robert I. Richter, Asst. U.S. Atty., Washington, D.C., with whom Earl J. Silbert, U.S. Atty., and John A. Terry, William D. Pease, and Jason D. Kogan, Asst. U.S. Attys., Washington, D.C., were on the brief, for appellee.
Before KELLY, NEBEKER and HARRIS, Associate Judges.
HARRIS, Associate Judge:
Appellants Ellis and Barnes were jointly tried before a jury and found guilty of the following offenses: Ellis was convicted of two counts of first-degree murder while armed, D.C.Code 1973, §§ 22-2401, -3202; two counts of first-degree murder, id. § 22-2401; one count of felony murder, id., *406 § 22-2401; one count of armed robbery, id., §§ 22-3201, -3202; one count of robbery, id., § 22-2901; one count of assault with intent to kill while armed, id., §§ 22-501, -3202; one count of assault with intent to kill, id., § 22-501; one count of assault with a dangerous weapon, id., § 22-502, and one count of carrying a pistol without a license, id., § 22-3204. Barnes was found guilty of two counts of second-degree murder while armed, id., §§ 22-2403, -3202; two counts of second-degree murder, id., §§ 22-3201, -3202; one count of armed robbery, id., §§ 22-3201, -3202; and one count of robbery, id., § 22-2901.
Appellants contend jointly that the trial court committed reversible error by: (1) refusing to sever their cases for trial, and (2) continuing to poll the jury after one juror dissented from a portion of the verdict as announced by the foreman. Appellants further contend that because the government introduced no evidence of a taking or asportation of anything of value, the evidence was legally insufficient to sustain their convictions for robbery, armed robbery, and, in the case of appellant Ellis, felony murder.
Additionally, appellant Barnes contends that the inconsistency of the jury's verdicts requires reversal of his convictions for second-degree murder while armed and second-degree murder, and that the evidence was insufficient to support his convictions on those counts. He also contends that the trial court failed to instruct the jury properly on the requisite element of malice with regard to the second-degree murder counts. Appellant Barnes further contends that the trial court's refusal to suppress testimony concerning his identification from a photo array was error because the identification resulted from the use of impermissibly suggestive procedures that created a likelihood of mistaken identification. He also asserts that should we find the evidence legally sufficient to sustain a conviction for armed robbery, that conviction nevertheless should be vacated because it merged with his conviction for felony murder. We disagree with all of these contentions and affirm the convictions with the exception of those which merge into more aggravated offenses.[1]
I
At 9:50 p. m. on January 19, 1976, Jacqueline Brown returned to the apartment she shared with Clarence Green. Shortly before 10:30 p. m., she received a telephone call from appellant Barnes, whom she had known for about two months. While she was on the phone, Green accompanied by Gerald Brown, came into the apartment; she gave him the phone. Green thereafter told Jacqueline Brown that Barnes was coming over and that she should let him in. Both men then left the apartment.
Shortly before 11:00 p. m., Green and Gerald Brown returned to the apartment accompanied by appellants Barnes and Ellis. Ellis was introduced as "Buddy." Jacqueline Brown and Barnes engaged in a conversation while Ellis looked around the apartment. Suddenly, Ellis pointed a pistol at Green's head and said, "I heard about the thing you did in Hampton, Virginia." *407 Green asked, "What?" Ellis then shot him. Ellis then fired at Jacqueline Brown, wounding her in the arm, as she ran toward the bedroom.
Jacqueline Brown, searching for a gun in the bedroom, heard more shooting and then threw herself against the door when she heard footsteps. Barnes and Ellis forced the door open, knocking her to the floor. Barnes came into the room first and rushed toward the dresser. Ellis stood over Jacqueline Brown and shot her twice, once in the leg and once in the stomach. She saw Ellis and Barnes ransack the dresser (Barnes removed some papers) and then overheard Ellis say, "Man, I thought it was supposed to be more stuff than this in this apartment." Barnes replied, "I've got to get the hell out of here." The two men left the bedroom, and fled the apartment.
After they left, Jacqueline Brown made her way into the living room, where she discovered the lifeless bodies of Green and Gerald Brown. As a result of her wounds, Jacqueline Brown was hospitalized until early February.
A police investigation of the scene revealed that Green's pockets were empty except for one which contained marijuana. Gerald Brown's rear pocket had been pulled out. Several coins were located near the bodies. A small tinfoil package containing marijuana was found on the floor several feet from Green's body. Brown's wallet was in the pocket of his coat, which was on the couch.
The morning after the homicides, Barnes left for Ohio. Sixteen days later, on February 5, he returned to the District of Columbia and surrendered to the police. He identified Ellis as the man responsible for the shootings. Ellis was arrested on February 7. He gave a statement to the police claiming that on January 19, in the late afternoon and early evening, he had attended a wake for his uncle, returned to his apartment, and then proceeded to a downtown nightclub.
Testimony introduced by Ellis at trial indicated that he had attended the wake and returned to his apartment (which he shared with his cousin and his cousin's girlfriend) sometime between 10:30 and 11:00 p. m. Neither the cousin nor his girlfriend knew if Ellis left the apartment after 11:00 p. m., but they testified that he was there when they awakened the next morning.
Barnes testified that on the morning of January 19 he sought unsuccessfully to reach Ellis to ask to borrow his car. That evening, Barnes telephoned Green expressing his desire to purchase some marijuana for an upcoming trip to Ohio. Around 11:15 p. m., Caroline Brooks (Barnes' sister) told Barnes that Ellis was downstairs and wanted to see him. Ellis was accompanied by Green and Gerald Brown; all three men were in Green's car. Barnes traveled with them to Green's apartment where he was to purchase some marijuana. All four men smoked marijuana on the way to Green's apartment.
Barnes went on to testify that when the shooting started he shouted at Ellis to stop. He claimed that he rifled through the dresser in an effort to distract Ellis from noticing that Jacqueline Brown was still alive. Attempting to placate Ellis, he suggested there might be some money in the apartment. To his knowledge, he testified, nothing was removed from the apartment.
II
We first address appellants' assertion that the jury was improperly polled. After the foreman announced the jury's verdicts, counsel for Ellis moved for a separate count-by-count poll of the jurors for each defendant. The trial court, however, merely repeated the verdicts and asked the jurors seriatim if they agreed with them. The first nine jurors responded affirmatively, but the tenth expressed disagreement. The judge routinely polled juror number ten separately as to each count and each defendant. It thus was discovered that the juror disagreed with the guilty verdict on the count charging Barnes with assaulting Jacqueline Brown with a dangerous weapon. *408 The court then polled jurors 11 and 12 as to the overall verdicts. After completing the poll, the trial court directed the jury to resume deliberations on the next morning on the count with respect to which there was disagreement. Before the jury could retire, however, the government moved to dismiss the disputed count against Barnes. That motion was granted, eliminating the need for an further deliberations.
We have stated that "after a juror's dissent is clearly registered, further polling is unnecessary and, in the absence of a contrary request by defense counsel, is error." In re Pearson, D.C.App., 262 A.2d 337, 340 (1970). We condemn continued polling because it "serves no salutary purpose while at the same time it discloses in open court the jury's numerical division and consequently subjects the dissenting juror or jurors to unnecessary coercion." Kendall v. United States, D.C.App., 349 A.2d 464, 466 (1975). We have, however, recognized that any jury poll where there is disagreement involves some degree of coercion, and the practical dictates of effective judicial administration require that we overturn a conviction only when "the inevitable effect [of continued polling] was to pressure the [dissenting] juror to conform her vote to that of the majority." Kendall v. United States, supra, at 466. See also Jackson v. United States, D.C.App., 377 A.2d 1151 (1977). It is settled that even in the potential minefield of a jury poll, the trial court enjoys an appreciable measure of discretion. See United States v. Brooks, 137 U.S.App. D.C. 147, 150, 420 F.2d 1350, 1353 (1969); Williams v. United States, 136 U.S.App.D.C. 158, 164, 419 F.2d 740, 746 (1969) (en banc). Reversal is warranted only when the trial court abuses its discretion by conducting itself in a manner that infringes upon the exercise of the jurors' free will.
We are satisfied that the polling procedure utilized in this case, while not conducted in strict compliance with the guidelines enunciated in Pearson, supra, was noncoercive in nature and did not constitute an undue intrusion into the exclusive province of the jury. This case, unlike Kendall, supra, Jones v. United States, D.C. App., 273 A.2d 842 (1971), and Pearson, supra, does not present the situation of one juror's being forced to defend her position in opposition to the apparent will of the rest of the jury. Juror number ten was not interrogated further after jurors 11 and 12 had given their responses. The trial court did not in any way attempt to persuade her to alter her vote, and the record reflects no indication that the count-by-count polling of that juror intimidated jurors 11 and 12 into suppressing any disagreement they might have had with the verdicts. We are satisfied that the procedure utilized did not constitute an abuse of discretion, particularly when it is recognized that disagreement existed as to only one count and one defendant in the trial of two defendants on a multi-count indictment.[2]
III
We turn now to appellants' claims that the court erred in not severing them for trial under Rule 14 of the Superior Court's Criminal Rules.[3]
"The prevailing rule is that defendants charged with jointly committing a criminal offense are to be tried jointly." Baxter v. United States, D.C.App., 352 A.2d 383, 385 (1976). The trial court has extremely wide latitude in determining whether to grant a motion for severance, and its determination will not be disturbed on appeal except upon *409 a showing of a clear abuse of discretion. Clark v. United States, D.C.App., 367 A.2d 158, 160 (1976).
Appellants contend that severance was mandated because their presentation of mutually exclusive defenses posed the danger that the jury would "unjustifiably infer that this conflict alone demonstrate[d] that both [were] guilty." See Rhone v. United States, 125 U.S.App.D.C. 47, 48, 365 F.2d 980, 981 (1966).
We agree with appellants that their defenses were essentially contradictory, with Ellis presenting an alibi defense and Barnes accusing Ellis of masterminding the crime. Nevertheless, "a testimonial conflict between codefendants is not alone sufficient ground to require a separate trial." Baxter v. United States, supra, at 385. The testimony of Jacqueline Brown was a searing indictment of Ellis' alibi defense. The strength of her testimony against both defendants persuades us that the jury would not have inferred from the conflict alone that the defendants were guilty. Furthermore, the testimony of appellant Barnes also would have been admissible against appellant Ellis in a separate trial. See Turner v. United States, D.C.App., 241 A.2d 736, 738 (1968). These two factors neutralize the claims of prejudice which appellant Ellis has advanced. Similarly, we are not swayed by appellant Barnes' assertion that a severance was required because the evidence against Ellis was far more damaging than the evidence against him, and thus that he was unduly prejudiced in the joint trial by a spillover of evidence.[4]See United States v. Gambrill, 146 U.S.App. D.C. 72, 83, 449 F.2d 1148, 1159 (1971). Barnes never denied his involvement in the crime. No evidence which was introduced by or against Ellis incriminated Barnes more than he would have been incriminated in a separate trial through his own testimony and the testimony of Jacqueline Brown. The mere presence of Ellis at the defense table was not a sufficient factor to warrant a finding of prejudice. The denial of Ellis' and Barnes' severance motions did not constitute an abuse of discretion. See Clark v. United States, supra, at 160.
IV
Appellants challenge their convictions for robbery and armed robbery, contending that the government failed to prove three essential elements of those offenses.[5] The crime of robbery is defined as follows:
Whoever by force or violence, whether against resistance or by sudden or stealthy seizure or snatching, or by putting in fear, shall take from the person or immediate actual possession of another anything of value, is guilty of robbery . . . [D.C.Code 1973, § 22-2901.]
Appellants' claims on this issue are founded on the alleged failure of the government to prove the following essential elements of the crime of robbery: (1) the taking and (2) asportation of (3) property of value. See United States v. McGill, 159 U.S.App.D.C. 337, 338, 487 F.2d 1208, 1209 (1973).[6] The indictment charged the theft *410 of money from Clarence Green.[7] The government's evidence on the robbery charges consisted of: (1) the testimony of Jacqueline Brown that Green would not go out without carrying money either in his pocket or in a wallet, and (2) physical evidence that (a) appellants went through the pockets of both Green and Gerald Brown, (b) one of Brown's pockets was turned inside out, (c) a few coins were found scattered near their bodies, and (d) both Green's and Brown's pockets were empty when their bodies were found.[8]
We recognize that the question is a close one. See Budd v. United States, D.C. App., 350 A.2d 742, 744 (1976); Bowles v. United States, 142 U.S.App.D.C. 26, 28, 439 F.2d 536, 538 (1970) (en banc), cert. denied, 401 U.S. 995, 91 S. Ct. 1240, 28 L. Ed. 2d 533 (1971). Nonetheless, we conclude that the evidence was sufficient to sustain appellants' armed robbery convictions. We base our decision on the following factors: (1) the testimony of Jacqueline Brown indicated that Green normally carried money, (2) the pockets of both of the murdered men had been rifled and change was strewn around the bodies, and (3) according to Jacqueline Brown, after Barnes ransacked the dresser in the bedroom, Ellis complained, "Man, I thought it was supposed to be more stuff than this in this apartment."
Although this evidence is largely circumstantial, no legal distinction exists between the significance of circumstantial and direct evidence. See United States v. Mackin, 163 U.S.App.D.C. 427, 439, 502 F.2d 429, 441 (1974), citing United States v. Fench, 152 U.S.App.D.C. 325, 333, 470 F.2d 1234, 1242 (1972), cert. denied sub nom. Blackwell v. United States, 410 U.S. 909, 93 S. Ct. 964, 35 L. Ed. 2d 271 (1973). Furthermore, in evaluating appellants' claims, we "must assume the truth of the Government's evidence and give the Government the benefit of all legitimate inferences to be drawn therefrom." Curley v. United States, 81 U.S. App.D.C. 389, 392, 160 F.2d 229, 232, cert. denied, 331 U.S. 837, 67 S. Ct. 1511, 91 L. Ed. 1850 (1947); see United States v. Mackin, supra. The evidence, taken as a whole, provides a legally sufficient basis for appellants' convictions for armed robbery.[9]
V
Ellis argues that the government's case against him rested almost entirely on the identification testimony of Jacqueline Brown. He contends that her identification of him was tainted by unduly suggestive procedures utilized by the government during the showing of two photo arrays. We disagree.
On January 20, 1976, Jacqueline Brown was shown an array of the photographs of nine individuals, all of whom were named Michael Barnes. She identified the Michael Barnes who had participated in the carnage at her apartment. On February 6, after Barnes had implicated Ellis, Jacqueline Brown was shown the same array, with the picture of Ellis having been added to the photographs of the eight other Michael Barnes. She then identified Ellis as the gunman.
We recently upheld a similar identification procedure in Harris v. United States, D.C.App., 375 A.2d 505 (1977), and the reasoning of that case is equally applicable *411 here. The record reflects that the witness did not retain a clear memory of the faces in the original array whom she could not identify and that the array consisted of "young black males, none of whom is so distinguishable from any one of the others, that he would particularly stand out." We conclude that the photo array procedures were not so "impermissibly suggestive as to give rise to a very substantial likelihood of irreparable misidentification." Simmons v. United States, 390 U.S. 377, 384, 88 S. Ct. 967, 971, 19 L. Ed. 2d 1247 (1968). The testimony relating to the photo identification was properly admitted.[10]
VI
Appellant Barnes alleges that there is a legally insufficient evidentiary basis upon which the jury could have concluded beyond a reasonable doubt that he aided and abetted the murders. Therefore, he contends that his convictions for second-degree murder while armed must be reversed. We disagree.
An individual who knowingly assists a principal in the commission of a criminal act is liable equally with the principal. Byrd v. United States, D.C.App., 364 A.2d 1215, 1219 (1976); see D.C.Code 1973, § 22-105. We have identified the essential elements of aiding and abetting as follows: (1) an offense was committed by someone; (2) the accused assisted or participated in its commission; and (3) the participation was with guilty knowledge. Byrd v. United States, supra; see Blango v. United States, D.C. App., 335 A.2d 230, 235 (1975). Viewing the evidence, as we must, in the light most favorable to the government, see Byrd v. United States, supra, at 1219; Creek v. United States, D.C.App., 324 A.2d 688, 689 (1974), and cases cited therein, we conclude that each of these elements was satisfied.
The crimes obviously were committed. Barnes' knowing participation in them was manifested by the following facts: (1) it was Barnes who arranged the meeting with Green; (2) Ellis shot everyone in the apartment except Barnes, and Barnes made no discernible attempt to restrain him; (3) Barnes, with Ellis behind him, forced open the door into the room where Jacqueline Brown had taken refuge; (4) Barnes made no attempt to prevent Ellis from shooting Jacqueline Brown; and (5) Barnes initiated the ransacking of the bedroom dresser. This evidence, taken as a whole, justifiably could have allowed a reasonable juror to conclude beyond a reasonable doubt that Barnes aided and abetted the commission of the crimes.[11]See Creek v. United States, supra, at 689; Crawford v. United States, 126 U.S.App.D.C. 156, 158, 375 F.2d 332, 334 (1967); Curley v. United States, supra.
VII
Appellant Barnes further cites as reversible error the fact that the trial court did not recite the complete standard instruction *412 on malice when it charged the jury on second-degree murder. No objection to the instruction was made at trial. The Supreme Court has stated: "It is the rare case in which an improper instruction will justify reversal of a criminal conviction when no objection has been made in the trial court." Henderson v. Kibbe, 431 U.S. 145, 154, 97 S. Ct. 1730, 1736, 52 L. Ed. 2d 203 (1977) (footnote omitted). This is not such a case.
In determining the possible existence of error, we must compare the instruction under attack with the instruction which should have been given. This comparison, however, may not be performed in a vacuum. It is well established that "a single instruction to a jury may not be judged in artificial isolation, but must be viewed in the context of the overall charge." Cupp v. Naughton, 414 U.S. 141, 146-47, 94 S. Ct. 396, 400, 38 L. Ed. 2d 368 (1973); Watts v. United States, D.C.App., 362 A.2d 706, 709 (1976) (en banc). See Boyd v. United States, 271 U.S. 104, 107, 46 S. Ct. 442, 70 L. Ed. 857 (1926).
The malice instruction which was given during the second-degree murder charge, standing alone, might have been inadequate.[12] In issuing this instruction, however, the trial court referred back to its earlier malice instruction which was given during the first-degree murder charge. The previous instruction substantially complied with the standard instruction [see D.C. Bar Ass'n, Criminal Jury Instructions, No. 4.23 (2d ed. 1972)], and provided the jury with a comprehensive definition of malice.[13] We do not mean to encourage the use of this referral technique which has come under criticism in the past.[14] Nevertheless, taking into account Barnes' failure to object to the instruction at trial, and evaluating *413 the instructions as a whole, see United States v. Wharton, 139 U.S.App.D.C. 293, 298-99, 433 F.2d 451, 456-57 (1970), we cannot say that there was a likelihood that the jury was misled to the extent that it was "more probable than not that an improper verdict was rendered." United States v. Thurman, 135 U.S.App.D.C. 184, 185, 417 F.2d 752, 753 (1969); see Lloyd v. United States, D.C.App., 333 A.2d 387, 390-91 (1975); Adams v. United States, D.C. App., 302 A.2d 232, 234 (1973). Accordingly, appellant Barnes' convictions for second-degree murder while armed are affirmed.
VIII
Finally, appellant Ellis contends that his conviction for armed robbery must be vacated because it merges into his conviction for felony murder. We rejected an identical contention involving convictions for rape and felony murder in Whalen v. United States, D.C.App., 379 A.2d 1152 (1977). There can be no merger of the subject offenses because the societal interests which Congress sought to protect by enacting § 22-3201 (armed robbery) differ from the societal interests which were meant to be protected by the enactment of § 22-2401 (felony murder). The purpose of the armed robbery statute is to protect individuals from being unwillingly deprived of their personal property through the use of armed force. "The felony murder statute purports to protect human life it dispenses with the need for the prosecution to establish that the accused killed with a particular state of mind, and instead permits the jury to infer the requisite intent from the fact that a felony was committed." Whalen v. United States, supra, at 1159 (footnote omitted). We find nothing in either the armed robbery or the felony murder statute to indicate that Congress intended to vitiate conviction for the underlying crime whenever death resulted during its commission. Id.; see also cases cited in Whalen v. United States, supra, at 1160 n.9. Accordingly, appellant Ellis' conviction for armed robbery is affirmed.
IX
We thus affirm appellant Ellis' convictions for two counts of first-degree murder while armed, and for single counts of felony murder, armed robbery, and assault with intent to kill while armed. We also affirm appellant Barnes' convictions for two counts of second-degree murder while armed and one count of armed robbery.
We have noted in footnote 1, supra, that convictions for a number of lesser-included offenses must be vacated, and that appellant Ellis must be resentenced on his conviction for carrying a pistol without a license. Repeatedly this court is finding it necessary to interject itself into the process of setting aside convictions for lesser-included offenses, as a consequence of which we take this opportunity to stress that these problems should be taken care of at the trial court level without necessitating the intercession of this court. Ideally they should not arise at all, assuming that proper jury instructions are given and followed. If such verdicts nonetheless are returned, the problem should be resolved immediately after the jury's return of its verdicts, when all aspects of the case are fresh in the minds of the trial judge, defense counsel, and the prosecutor. If for some reason that cannot be accomplished, the sentencing hearing provides a second opportunity which could be utilized for such a purpose.
While no problem of the setting aside of a lesser-included offense conviction thus should survive to the appellate level, if it does there should be no need for both sides to brief the issue and rely upon our resolution thereof. When the problem is recognized by appellate counsel (on either side of the case), discussions readily may be conducted, and, if necessary, on appropriate motion we could deem the record to be remanded so as to permit trial court resolution of the situation without delaying the hearing and disposition of the appeal on the merits. See, e. g., Smith v. Pollin, 90 U.S. App.D.C. 178, 194 F.2d 349 (1952).
NOTES
[1] Appellant Ellis also contends, and the government has conceded, that his convictions for first-degree murder, robbery, assault with intent to kill, and assault with a deadly weapon should be vacated because they merge with the more serious offenses of which he was convicted. The same contention is made by appellant Barnes with regard to his convictions for second-degree murder and robbery; the government similarly concedes the validity of those contentions. We agree, see e. g., Woody v. United States, D.C.App., 369 A.2d 592, 595 (1977) (robbery is a lesser-included offense of armed robbery); Bell v. United States, D.C. App., 332 A.2d 351, 355 (1975) (assault with a dangerous weapon is a lesser-included offense of armed robbery), and remand the cases with directions to vacate those convictions.
The government also has agreed with appellant Ellis that his felony sentence for carrying a pistol without a license should be vacated because the trial court failed to comply with the requirements of D.C.Code 1973, § 23-111(b). Finding this assertion meritorious, we direct that the sentence on that count be vacated and we remand for resentencing on that charge. See Smith v. United States, D.C.App., 356 A.2d 650, 651-52 (1976); Irby v. United States, D.C. App., 342 A.2d 33, 41 (1975); Smith v. United States, D.C.App., 304 A.2d 28, 34-35 (1973).
[2] We note that had the trial court not granted the government's motion to dismiss the contested count, and had the case been returned to the jury, we would have been faced with a situation in which coercion was more likely to have occurred as to the contested count had a verdict of guilty resulted.
[3] Rule 14 provides in relevant part:
If it appears that a defendant . . . is prejudiced by a joinder . . . of defendants in an indictment or information or by such joinder for trial together, the court may order an election or separate trials of counts, grant a severance of defendants or provide whatever other relief justice requires.
[4] Barnes did not request a severance prior to trial in accordance with Super.Ct.Cr.R. 12(b)(5). Nevertheless, we deal with his claim on the merits because, under Super.Ct.Cr.R. 14, the trial court has a continuing obligation to grant a severance of codefendants if, at any time during the trial, undue prejudice to either defendant arises as a result of the joinder of their cases. Schaffer v. United States, 362 U.S. 511, 80 S. Ct. 945, 4 L. Ed. 2d 921 (1960); Evans v. United States, D.C.App., 392 A.2d 1015, at 1020 (1978); United States v. Leonard, 161 U.S.App.D.C. 36, 46, 494 F.2d 955, 965 (1974).
[5] As stated in n.1, supra, the robbery charges merged into the armed robbery convictions, so the convictions on the former must be vacated.
[6] Appellants rely heavily on the McGill case. We are not persuaded, however, that the conclusion reached in that case was in accord with the weight of the law in this jurisdiction. In any event, we are not bound by that decision, see M.A.P. v. Ryan, D.C.App., 285 A.2d 310 (1971), and there is ample precedent to support a contrary determination in the instant case. See Bowles v. United States, 142 U.S.App.D.C. 26, 439 F.2d 536 (1970) (en banc), cert. denied, 401 U.S. 995, 91 S. Ct. 1240, 28 L. Ed. 2d 533 (1971).
[7] Appellants were found not guilty of the alleged robbery and armed robbery of Gerald Brown.
[8] Perhaps critical to the verdicts of not guilty as to the charged robbery of Brown was the fact that Brown's wallet was found undisturbed in the pocket of his coat, which was on the couch.
[9] Appellant Ellis also attacks his conviction for the felony murder of Green on the ground that the evidence is insufficient to support a finding that a robbery was perpetrated or that an attempt was made to perpetrate a robbery. See D.C.Code 1973, § 22-2401. We are satisfied, however, that a reasonable person could have concluded from the government's proof that the murders of Brown and Green took place during the commission of a robbery and therefore constituted felony murder. See Calhoun v. United States, D.C.App., 369 A.2d 605, 607 (1977), and cases cited therein.
[10] We note, however, that under certain circumstances, the repeated use of an essentially identical photo array might be so suggestive as to violate an accused's due process rights. Our decision today should not be interpreted to encourage the use of such a procedure.
[11] Appellant Barnes makes the additional assertion that his convictions for second-degree murder while armed must be reversed because of the inconsistency of the jury's verdicts. He points out that since he was acquitted of first-degree murder, and Ellis was found guilty on those counts, the jury must have concluded that Barnes had not been the accomplice of Ellis in the commission of the homicides. While the jury's verdicts do appear to be inconsistent, inconsistent jury verdicts are not grounds for reversal. See United States v. Dotterweich, 320 U.S. 277, 279, 64 S. Ct. 134, 88 L. Ed. 48 (1943); Dunn v. United States, 284 U.S. 390, 393-94, 52 S. Ct. 189, 76 L. Ed. 356 (1932). We previously have noted, and we now reiterate, that "[t]he law correctly recognizes that it must make room for jurors' negotiation and compromise during deliberation." Steadman v. United States, D.C.App., 358 A.2d 329, 332 (1976). Therefore, the only issue properly under review is whether the evidence presented adequately supports the jury's verdicts. See Steadman v. United States, supra. We answer that question in the affirmative. [For cases which sustain convictions of aiders and abettors for lesser offenses than those of which the principal was convicted, see United States v. Paszek, 432 F.2d 780 (9th Cir. 1970); People v. Folkes, 71 Mich.App. 95, 246 N.W.2d 403 (1976).]
[12] The instruction given was:
Now, malice does not come as I have indicated before, necessarily imply ill-will, spite, hatred or hostility by the defendant or someone whom he aided and abetted, but, indeed, as I have indicated before, malice is a state of mind showing a heart regardless of the life and safety of others.
[13] The complete definition of "malice" in the second-degree murder standardized jury instruction (No. 4.23) reads:
"Malice" does not necessarily imply ill-will, spite, hatred, or hostility by the defendant toward the person killed. "Malice" is a state of mind showing a heart regardless of the life and safety of others, a mind deliberately bent on mischief, a generally depraved, wicked and malicious spirit. "Malice" may also be defined as the condition of mind which prompts a person to do wilfully, that is, on purpose, without adequate provocation, justification or excuse, a wrongful act whose foreseeable consequence is death or serious bodily injury to another.
Malice may be either express or implied. Express malice exists where one unlawfully kills another in pursuance of a wrongful act or unlawful purpose, without legal excuse. Implied malice is such as may be inferred from the circumstances of the killing, as, for example where the killing is caused by the intentional use of fatal force without circumstances serving to mitigate or justify the act, or when an act which imports danger to another is done so recklessly or wantonly as to manifest depravity of mind and disregard of human life.
[In determining whether a wrongful act is done with malice, you may infer that a person ordinarily intends the natural and probable consequences of acts knowingly done or knowingly omitted. However, you should consider all of the circumstances and evidence that you deem relevant in determining whether the Government has proved beyond a reasonable doubt that the defendant acted with the required malice.]
If a person uses a deadly weapon in killing another person, you are permitted to draw the inference of malice from his use of such weapon, in the absence of explanatory or mitigating circumstances. You are not required to infer malice from the use of such weapon, but you may do so if you deem it appropriate.
Use of the bracketed language is discretionary. The italicized portions constitute the instruction as delivered by the trial court to the jury during the first-degree murder charge.
[14] The United States Court of Appeals for the District of Columbia Circuit has recognized that this procedure is subject to criticism on the ground that the full definition of "malice" relevant to second degree murder contains an objective element for the case of an act that is so reckless as to indicate a disregard of human life that is inappropriate for first degree murder with its requirement of premeditation. [United States v. Wharton, 139 U.S.App. D.C. 293, 298 n.27, 433 F.2d 451, 456 n.27 (1970); see United States v. Dixon, 135 U.S. App.D.C. 401, 404-05, 419 F.2d 288, 291-92 (1969) (Leventhal, J., concurring).] | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603980/ | 882 F. Supp. 166 (1995)
UNITED STATES of America ex rel. Theresa BURR, Plaintiff,
v.
BLUE CROSS AND BLUE SHIELD OF FLORIDA, INC., a Florida corporation, Defendant.
No. 91-134-CIV-J-16.
United States District Court, M.D. Florida, Jacksonville Division.
March 23, 1995.
*167 Brian M. Kane, Asst. U.S. Atty., Jacksonville, FL, Michael C. Theis, U.S. Dept. of Justice, Civ. Div., Washington, DC, for plaintiff U.S.
William George Cooper, Tracy K. Arthur, Jacksonville, FL, Dennis M. Abrams, Lowenthal & Abrams, P.C., Bala Cynwyd, PA, for plaintiff Burr.
John M. McNatt, Jr., Osborne, McNatt, Shaw, O'Hara, Brown & Obringer, Jacksonville, FL, for defendant.
ORDER AND OPINION
JOHN H. MOORE, II, Chief Judge.
This cause is before the Court on the Relator's Motion for Attorney's Fees and Costs filed August 16, 1994, (Doc. # 206) and Motion for Percentage of False Claims Settlement filed September 1, 1994 (Doc. # 210). The Defendant filed a response in opposition to the motion for attorney's fees and costs on September 2, 1994. The Plaintiff filed a response in opposition to the motion for the Relator's percentage of the settlement proceeds on September 29, 1994. Upon due consideration of the motions and the legal premises therein, the Court finds that the motions should be granted in part and denied in part and the fee application referred to the magistrate judge for a report and recommendation.
I. Background Facts
Theresa Burr ("Relator") filed this qui tam action against Blue Cross Blue Shield of Florida (BCBSF) pursuant to the False Claims Act ("FCA"), 31 U.S.C. § 3730 (1988), on February 19, 1991. The United States intervened and filed an Amended Complaint on July 10, 1992, alleging numerous instances of fraud involving the processing of Medicare claims. The Relator continued as a party and on August 4, 1993, the United States and BCBSF entered into a proposed settlement.
The Court referred this matter to a magistrate judge to conduct a hearing and prepare a report and recommendation on the fairness, adequacy, and reasonableness of the proposed settlement. The Court entered an Order on August 2, 1994, approving the proposed settlement and notwithstanding the objections made by the Relator, dismissed the action with prejudice. Subsequent to the filing of the motions for attorney's fees, costs, and percentage of the settlement proceeds, the Relator appealed this decision to the Eleventh Circuit Court of Appeals. Consequently, this Court stayed its ruling on these motions in the interest of judicial economy pending the Relator's appeal of the Court's approval of the settlement of this action. On November 11, 1994, the appellate court entered a judgment of voluntary dismissal of the appeal. Accordingly, the Court finds that the stay entered by this Court should now be lifted.
On December 9, 1994, the Plaintiff filed a Notice of Advisement of Intent to Make Payment to Relator which indicated that the government intended to distribute fifteen percent of the $10 million settlement proceeds to the Relator. The Relator has specifically reserved her right to have the Court determine her share of the settlement proceeds. By Order of the Court dated February 6, 1995, the Court granted a charging lien in favor of Epstein, Becker & Green, P.C., the Relator's initial counsel, and specifically prohibited the Plaintiff from distributing any of the settlement proceeds to the Relator until the issue of this counsel's legal fees was resolved. Although the Court determines that the Relator is entitled to $1.5 million as her percentage of the settlement proceeds in this litigation, the Court finds that these proceeds should not be disbursed *168 until the issue of Epstein, Becker & Green's legal fees is resolved.
II. Discussion
A. False Claims Act (FCA) qui tam Provisions
Congress enacted the FCA in 1863 with the primary purpose of being the government's litigation tool for combatting fraud against the federal government.[1] The FCA authorizes private individuals, in addition to the Attorney General, to file civil actions for enforcement. 31 U.S.C.S. § 3730(b) (Supp. 1994). Suits by private individuals, or qui tam suits, may be brought for any substantive violation of the Act.[2]Id. at § 3730(b)(1). However, the suit is brought in the name of the Government which has the option of intervening and proceeding with the action. Id. at § 3730(b)(1) & (4). If the Government declines to intervene in the qui tam action, the private individual or relator possesses the right to conduct the action. Id. § 3730(b)(4).
If the Government chooses to intervene, it has the primary responsibility for prosecution and may settle or dismiss the action. Id. § 3730(c)(2). The relator may continue as a party to the qui tam action and may object to its settlement or dismissal. Id. § 3730(c). However, the action may be settled or dismissed notwithstanding objection provided the relator has been notified of the proposed action and an opportunity for a hearing on the motion. Id. § 3730(c)(2). In approving a proposed qui tam settlement, the court must find that it is fair, adequate, and reasonable under all the circumstances. Id. § 3730(c)(2)(B).
The FCA also provides for the award of a percentage of any settlement proceeds as well as reasonable attorney's fees and costs. Id. § 3730(d)(1). The FCA specifically provides that in an action where the government proceeds with a case brought by a private individual, the relator "shall ... receive at least 15 percent but not more than 25 percent of the proceeds of the action or settlement of the claim, depending upon the extent to which the person substantially contributed to the prosecution of the action." Id. (emphasis added.) Further, a relator "shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall be awarded against the defendant." Id.
B. Percentage Of The Settlement Proceeds
Section 3730(d)(1) of the FCA has been interpreted to mean that in a case not based primarily on disclosures of specific information other than the information provided by the relator[3] individuals who substantially and independently contribute to the government's recovery are entitled to recover the minimum 15 percent of the settlement proceeds. United States v. Stern, 818 F. Supp. 1521, 1522 (M.D.Fla.1993). However, a relator is entitled to recover a full 30 percent of the settlement in such a case where the relator has suffered considerable personal and professional expense. United States v. Mazak Corp., 807 F. Supp. 1350, 1353 (S.D.Ohio 1992). The award of the maximum statutory amount in this instance is intended to encourage other potential whistle-blowers to take similar risks in order to expose fraud against the United States. Id. Accordingly, the Court is persuaded that the maximum recovery is reserved for situations where the relator actively and uniquely aids the government in the prosecution of the case. See United States v. Covington Technologies Co., No. 88-5807-JMI (Bx), 1991 WL 643048 (C.D.Cal. Oct. 22, 1991).
*169 As a threshold matter, the Court finds that the lengthy factual record in this matter is sufficient for the Court to make this determination; therefore, the Relator's request for an evidentiary hearing shall be denied. The potential range of the Relator's percentage of the $10 million settlement proceeds is $1.5 million to $2.5 million. Of course, the Relator requests $2.5 million or 25% of the settlement amount and the government argues that she is only entitled to $1.5 million or 15% of the settlement amount. This dispute is illustrative of the course of conduct in this litigation. Although a settlement was announced on August 3, 1993, the parties succeeded in litigating the appropriateness of the Court's approval of the settlement for another year. Even then, the Relator appealed the Court's decision to approve the settlement and ironically, decided to drop the appeal only after the Court stayed ruling on the instant motions pending the appeal. At long last, the Court is presented with the adjudication of the final issues in this "litigious" matter. Yet the Court is once again confronted with disagreement and the parties election to litigate to the very end.
The Plaintiff has advised the Court of its intent to distribute $1.5 million of the settlement proceeds to the Relator. The pertinent issue then is whether the Relator is entitled to a greater percentage of the settlement proceeds. The Court thinks not. The FCA specifically delineates that a relator is entitled to a percentage of the settlement proceeds, within the applicable range, to "the extent to which the person substantially contributed to the prosecution of the action." 31 U.S.C. § 3730(d) (emphasis added). Although a realtor may be entitled to the statutory maximum percentage in situations where the relator has suffered personal or professional hardship, no such showing has been made in the present case. In fact, the Relator fails to even address this point and relies instead on bold self-appreciation for her efforts. However, the Court finds that although the Relator may have initiated this action, her contribution to the successful settlement of this matter was minimal at best. The record clearly demonstrates that the Relator's sworn affidavit instigated an investigation by several governmental agencies. This investigation lasted over three years and the Relator repeatedly objected to being left out of this process. Eventually, the Relator was permitted limited discovery regarding the proposed settlement of this action, to which she vigorously opposed. The Court found much of the Relator's opposition to be wholly without merit. Therefore, the Court finds that $1.5 million, or 15% of the settlement proceeds, accurately reflects the Relator's contribution to the prosecution of this action.
Implicit within the Court's finding that the Relator is entitled to $1.5 million or 15% of the settlement proceeds is that the amount of the settlement was $10 million. The Relator argues that the actual settlement was for $25 million. The Court disagrees. The report and recommendation of the magistrate judge adopted by this Court on August 1, 1994, specifically found that BCBSF agreed to pay the United States $10 million in settlement of this action. The Court is not persuaded by the Relator's contention that the value of sums received by BCBSF from third parties in settlement of several collateral claims should be added to this figure. Specifically, in addition to the settlement between the United States and BCBSF, this global settlement included a compromise and settlement of an administrative claim by BCBSF against the Health Care Financing Administration as well as a claim against GTE Data Services, Inc. However, the settlement of these collateral claims are only incidental to this qui tam action and should not be considered when determining the Relator's percentage of the settlement proceeds pursuant to § 3730(d)(1). Accordingly, the Relator is entitled to 15% of the $10 million settlement, or $1.5 million, pursuant to § 3730(d)(1) of the FCA.
C. Attorney's Fees And Costs
Federal courts have applied the standard "lodestar" methodology in determining a reasonable amount of attorneys' fees in qui tam actions. Stern, 818 F.Supp. at 1522; United States v. General Electric, 808 F. Supp. 584, 585 (S.D.Oh.1992) (citing Northcross v. Bd. of Educ. of Memphis City Schools, 611 F.2d 624 (6th Cir.1979)). The "starting point" for setting an attorney's fee *170 is to determine the lodestar figure: the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S. Ct. 1933, 1939, 76 L. Ed. 2d 40 (1983); Norman v. Housing Authority of City of Montgomery, 836 F.2d 1292, 1299 (11th Cir.1988); Bowen v. Southtrust Bank of Alabama, 760 F. Supp. 889, 896 (M.D.Ala. 1991). In making this determination, the district court is guided by the 12 factors identified in Johnson v. Georgia Highway Express, 488 F.2d 714 (5th Cir.1974). These factors are:
(1) the time and labor required; (2) the novelty and difficulty of the questions; (3) the skill required to perform the legal services properly; (4) the preclusion of other employment by the attorney due to acceptance of the case; (5) the customary fee in the community; (6) whether the fee is fixed or contingent; (7) time limitations imposed by the client or circumstances; (8) the amount involved and the results obtained; (9) the experience, reputation, and ability of the attorney; (10) the "undesirability" of the case; (11) the nature and length of any professional relationship with the client; and (12) awards in similar cases.
Id. at 717-19.
The fee applicant bears the burden of "establishing entitlement and documenting the appropriate hours and hourly rates." Norman, 836 F.2d at 1303. In circumstances where the court is faced with an inadequate fee application, the law in this circuit is well established that:
[t]he court, either trial or appellate, is itself an expert on the question and may consider its own knowledge and experience concerning reasonable and proper fees and may form an independent judgment either with or without the aid of witnesses as to value.
Id.
Accordingly, the district court may make the award on its own experience when the time or fees claimed seemed expanded or there is a lack of documentation or testimonial support. Id. The district court's order must articulate the decisions it made, give principled reasons and show calculations. Id. (citations omitted). "If the court disallows hours, it must explain which hours are disallowed and show why an award of these hours would be improper." Id. (citations omitted).
The Relator's fee application requests over $700,000.00 in attorney's fees and costs representing the payment of fees for twenty-nine attorneys, paralegals, and assistants. More importantly, however, these fees are for compensation for over four thousand billing hours. Of course, the parties dispute the requested fees and have requested additional discovery and an evidentiary hearing on the fee application. The Relator seeks discovery from BCBSF as to the number of hours and amount of fees billed to BCBSF and BCBSF requests the opportunity to conduct discovery if the Court determines that the Relator is entitled to any fees and costs. BCBSF also raises significant factual and legal issues regarding the Relator's course of conduct during the proceedings in which she contested the proposed settlement as well as the proceedings leading up to the settlement agreement. Accordingly, the Court finds that since the matter of the Relator's fee application necessitates the holding of a hearing, and involves the proceedings presided over by the magistrate judge, the Court finds that this matter should be referred to the magistrate judge for a report and recommendation.
For the foregoing reasons, it is now
ORDERED AND ADJUDGED:
1. That the Motion of Relator to Lift Stay and for Rule 16 Conference filed March 7, 1995, (Doc. # 227) is hereby GRANTED in part and the stay imposed by this Court on October 7, 1994, (Doc. # 220) is hereby LIFTED. The motion for a Rule 16 Conference is hereby DENIED.
2. That The Relator's Motion for Percentage of False Claims Settlement filed September 1, 1994, (Doc. # 210) is hereby GRANTED in part and pursuant to 31 U.S.C. § 3730(d)(1) the Relator, Theresa Burr, is awarded $1.5 million representing 15% of the $10 million settlement; however, the charging lien granted in favor of Epstein, *171 Becker & Green, P.C. in the Court's Order of February 6, 1995, shall remain intact pending the resolution of Epstein, Becker & Green's legal fees. The Relator's Motion for an Evidentiary Hearing is hereby DENIED AS MOOT.
3. That the Relator's Motion for Attorney's Fees and Costs filed August 16, 1994, (Doc. # 206) and Motion for an Evidentiary Hearing (Doc. # 208) are hereby REFERRED to Magistrate Judge Snyder to conduct all necessary proceedings and to submit to this Court proposed findings of fact and recommendations in accordance with 28 U.S.C. § 636(b) and Local Rule 6.01(a).
DONE AND ORDERED.
NOTES
[1] Senate Judiciary Committee, False Claims Amendments Act of 1986, S.Rep. No. 345, 99th Cong., 2d Sess. 2 (1986), reprinted in 1986 U.S.C.C.A.N. 5266.
[2] The term "qui tam" is short for "qui tam pro domino rege quam pro se imposo sequitur" which means "who brings the action as well for the king as for himself." Bass Anglers Sportsman's Society of Am. v. U.S. Plywood-Champion Papers, Inc., 324 F. Supp. 302, 305 (S.D.Tex. 1971).
[3] See United States v. CAC-Ramsay, Inc., 744 F. Supp. 1158, 1161 (S.D.Fla.1990) for an example of a qui tam action based upon the disclosure of specific information where the relator is only entitled to receive a maximum 10 percent of the settlement proceeds under § 3730(d)(1) of the FCA. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1174024/ | 658 P.2d 312 (1983)
Larry E. MEHAU and Moses W. Kealoha, Plaintiffs-Appellants, Cross-Appellees,
v.
GANNETT PACIFIC CORPORATION, a Delaware corporation, dba Honolulu Star Bulletin; Kinau Boyd Kamalii; Lee Enterprises, Inc., a Delaware corporation, dba KGMB-TV; Hawaii Tribune Herald, Ltd., a Nevada corporation, dba Hawaii Tribune Herald; Western Telestations, Inc., a Wyoming corporation, dba Kitv, Defendants-Appellees, and
Valley Isle Publishers; Leslie Moore; Rick Reid; Geoffrey Silva, and Kinau Boyd Kamalii, Defendants, Cross-Appellants, and
Scott Shirai, KHON-TV, Inc., a Delaware corporation, dba KHON-TV; KHVH, Inc., a Hawaii corporation, dba KHVH Radio; United Press International, a New York corporation; John Does I-XX; and John Doe Corporations I-XX, Defendants.
No. 7519.
Supreme Court of Hawaii.
February 2, 1983.
*316 David C. Schutter, Hawaii (Judith Ann Pavey, Honolulu, with him on the briefs; David C. Schutter, A Law Corp., Hawaii, of counsel), for plaintiffs-appellants.
Paul Alston, Honolulu (James T. Paul, Honolulu, with him on the brief; Paul, Johnson & Alston, Honolulu, of counsel), for defendant-appellee UPI.
Steven K. Christensen, Hilo, for defendant-appellee Hawaii Tribune-Herald.
Clyde Wm. Matsui, Honolulu (Kobayashi, Watanabe, Sugita & Kawashima, Honolulu, of counsel), for defendant-appellee Lee Enterprises.
David J. Dezzani, Honolulu (Goodsill, Anderson & Quinn, Honolulu, of counsel), for defendants-appellees Gannett Pacific Corp. and KHVH, Inc.
Burnham H. Greeley, Honolulu (Genevieve S. Richardson, Honolulu, with him on the brief; Carlsmith, Carlsmith, Wichman & Case, Honolulu, of counsel), for defendant-appellee Western Telestations.
David L. Turk, Honolulu (Donna M. Woo, Honolulu, with him on the briefs; David L. Turk, A Law Corp., Honolulu, of counsel), for cross-appellant Kamalii.
Faye Koyanagi, Deputy Corp. Counsel, Honolulu (John W.K. Chang, Deputy Corp. Counsel, Honolulu, on the brief), for Intervenor City & County of Honolulu.
Edward Y.N. Kim, Honolulu, on the brief for defendants-cross-appellants Valley Isle, Moore, Reid and Silva.
Before NAKAMURA, J., MENOR, Retired Justice, in place of LUM, J., recused, ACOBA, Circuit Judge, in place of PADGETT, J., recused, and TSUKIYAMA, Circuit Judge, in place of HAYASHI, J., recused.[*]
NAKAMURA, Justice.
Once again the question before us is whether published imputations of criminality may have transgressed the bounds of constitutionally protected speech and press. We are asked to decide whether two public officials can proceed to trial on their defamation suit against a host of defendants from the press and the electronic media[1]*317 and a State legislator[2] and whether the legislator should have access through the discovery process to records of the Honolulu Police Department that may aid her defense of the action if we determine the two may go forth with the claim against her. The circuit court awarded summary judgments in favor of the legislator and all of the media defendants save the Valley Isle Publishers (the Valley Isle) and its officers. We conclude, however, that the officials ought to be afforded an opportunity to prove they were also defamed and damaged by the United Press International (UPI) and the legislator and that she should be given an opportunity to show such access would not jeopardize other important public interests.
I.
A.
The plaintiffs are Larry E. Mehau (Mehau) and Moses W. Kealoha (Kealoha) who were members of the State Board of Land and Natural Resources during relevant times; the complaint in essence avers they were defamed by untrue accounts of their gross criminality. The genesis of the controversy was a KHON-TV newscast of February 2, 1977 reporting the head of the local criminal "syndicate" then sat on an important State board.[3] Though rumors of a "Hawaiian Syndicate" and its "Godfather" had been afloat for months, the newscast was the initial report by the established news media concerning his actual identity.
Subsequently the Valley Isle,[4] a new Maui tabloid without a "track record" for reliability, published a story quoting Adolph Helm as saying his brother, the late George Helm, Jr.,[5] had named Mehau as the "Godfather" of Hawaii's underworld crime.[6] Dennis Stone, a UPI reporter, learned of the article through a radio station employee on the day of its publication, June 15, 1977. Stone then called the Maui News, a well-established semi-weekly Maui newspaper, and had a staff member read portions of the story to him. He then attempted to reach Adolph Helm by telephone, presumably to seek confirmation of the statements attributed to Helm, but was unsuccessful. He spoke instead to Adolph's father, who told him George Helm, Jr. had said he had been threatened by Mehau. Relying on the parts of the Valley Isle article that were read by *318 the Maui News employee and the statement of George Helm, Sr., Stone composed a news release and caused it to be transmitted over the UPI wire to its subscribers.[7] A follow-up story was also transmitted after Stone spoke to Adolph Helm.[8]
B.
The Valley Isle story and UPI's coverage thereof, of course, attracted widespread press, radio, and television attention. The Tribune-Herald, a subscriber to the news service, for one published a story substantially replicating the UPI releases on the day after the publication of the controversial article. And on June 17, 1977, it followed through with another story reporting Governor Ariyoshi's response to a query about the accusations in the Maui publication, a response which essentially was a defense of Mehau's character. Others who were not UPI subscribers published or broadcast varying reports on the controversy. These, however, consisted in the main of the reactions of the Governor, other public officers, public figures, and organizations to the earlier reports of the plaintiffs' link to the nether world of organized crime.
KGMB-TV telecast reports of the charges leveled against the plaintiffs by the Maui tabloid and repeated by UPI, as well as the public reactions thereto, between the 15th and 22nd of June. Though Mehau was identified as the reputed "Godfather," the telecasts invariably mentioned the source of the accusations against him. The Star-Bulletin, KHVH, and KITV also carried accounts of the published accusations, but like KGMB-TV devoted much of their reporting thereafter to the public reaction engendered thereby and to statements issued by other public officials, public figures, and organizations relative to Mehau's character. And these media defendants in their articles, broadcasts, and telecasts likewise noted where the charges originated.
C.
The public issue created by the KHON-TV newscast of February 2, 1977 and the Valley Isle story was relentlessly pursued by Representative Kamalii in the halls of the legislature and beyond. Shortly after the purported expose by Scott Shirai that a member of a State board was the "Godfather," she introduced two resolutions in the State House of Representatives, which was then in session. The resolutions, House Resolution Nos. 292 and 293, had as their objects a legislative probe into the allegations made by Scott Shirai and twenty-four hour police protection for him. She also issued public statements calling upon the Attorney General and the House Committee on Judiciary to launch investigations into the charges. The Attorney General and the Speaker of the House, however, responded publicly that investigations of such nature were more properly matters for the police to pursue. And the resolutions sponsored *319 by Representative Kamalii failed to emerge from committee for adoption by the House of Representatives.
The legislator nevertheless continued her efforts to publicize the accusations despite this setback and the closing of the legislative session. On April 6, 1977, she fostered the publication of an article in the Star-Bulletin entitled "Answer Asked to `Godfather' Charge," and while speaking at a meeting of the Kailua Chamber of Commerce shortly after the crucial story appeared in the Valley Isle, she identified Mehau as the "Godfather." But this did not mark the end of her involvement in the controversy; she was also interviewed by the Valley Isle after the Kailua meeting and a story containing her innuendos that the "Godfather" and Mehau were one and the same appeared in a subsequent issue of the news organ.
D.
Mehau and Kealoha filed their eleven count complaint against numerous defendants, both named and unnamed, on June 23, 1977. After responsive pleadings were submitted by the defendants who were served and extensive discovery efforts by both plaintiffs and defendants, summary judgments were sought. The circuit court granted judgments in favor of the Star-Bulletin, the Tribune-Herald, KGMB-TV, KITV, KHVH, UPI, and Representative Kamalii. It denied the motion filed by the Valley Isle and its officers. The orders granting the summary judgments were certified thereafter as appealable by the circuit court, and the plaintiffs perfected their appeal to this court. Representative Kamalii in turn appealed from an order foreclosing her attempt to have the Honolulu Police Department produce records and documents related to Mehau and others in order to protect her interests in the event plaintiffs succeeded on their appeal.
II.
A.
1.
The First Amendment represents "a profound national commitment to the principle that debate on public issues should be uninhibited, robust, and wide-open, and that it may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials. See Terminiello v. Chicago, 337 U.S. 1, 4 [69 S. Ct. 894, 895, 93 L. Ed. 1131]; De Jonge v. Oregon, 299 U.S. 353, 365 [57 S. Ct. 255, 260, 81 L. Ed. 278]." New York Times Co. v. Sullivan, 376 U.S. 254, 270-71, 84 S. Ct. 710, 720-21, 11 L. Ed. 2d 686 (1964). But "erroneous statement is inevitable in free debate," and "it must be protected if the freedoms of expression are to have the `breathing space' that they `need ... to survive.'" Id. at 271-72, 84 S.Ct. at 721 (citation omitted). A rule of law that compels one who would engage in such debate "to guarantee the truth of all his factual assertions and to do so on pain of libel judgments virtually unlimited in amount leads to a comparable `self-censorship.'" Id. at 279, 84 S.Ct. at 725. Would-be critics "may be deterred from voicing their criticism, even though it is believed to be true and even though it is in fact true, because of doubt whether it can be proved in court or fear of the expense of having to do so." Id.
Yet "[t]he need to avoid self-censorship by the news media is ... not the only societal value at issue" where erroneous statement relating to the conduct of public officials is concerned. Gertz v. Robert Welch, Inc., 418 U.S. 323, 341, 94 S. Ct. 2997, 3007, 41 L. Ed. 2d 789 (1974). Recognizing that the absolute protection of "the communications media ... [would result in] a total sacrifice of the competing value served by the law of defamation," id., the Supreme Court has sought a "proper accommodation between these competing concerns" by extending "a measure of strategic protection to defamatory falsehood" uttered by the media. Id. at 342, 94 S.Ct. at 3008. And "the level of constitutional protection appropriate to the context of defamation of a public person" was defined in New York Times Co. v. Sullivan, supra. Under this standard,
*320 [t]hose who, by reason of the notoriety of their achievements or the vigor and success with which they seek the public's attention, are properly classed as public figures and those who hold governmental office may recover for injury to reputation only on clear and convincing proof that the defamatory falsehood was made with knowledge of its falsity or with reckless disregard for the truth. This standard administers an extremely powerful antidote to the inducement to media self-censorship of the common-law rule of strict liability for libel and slander. And it exacts a correspondingly high price from the victims of defamatory falsehood. Plainly many deserving plaintiffs, including some intentionally subjected to injury, will be unable to surmount the barrier of the New York Times test.
Id.
The Fourteenth Amendment rendered it incumbent upon us to extend this "measure of strategic protection" to media defendants against whom damages for defamation are sought by public officials in the courts of the State. Thus,
[a]fter reviewing the New York Times decision and its progeny, we defined "actual malice" in Tagawa v. Maui Publishing Co. (Tagawa II), 50 Haw. 648, 652, 448 P.2d 337, 340, cert. denied, 396 U.S. 822 [90 S. Ct. 63, 24 L. Ed. 2d 73] (1968) as "`deliberate falsification' of facts or `reckless disregard' of the truth, i.e., reckless publication despite a high degree of awareness, harbored by the publisher, of the probable falsity of the published statements."
Rodriguez v. Nishiki, 65 Haw. 430, 436, 653 P.2d 1145, 1149 (1982).
2.
Whether the test of "malice" enunciated in New York Times and restated in Gertz is applicable to defamation suits brought by public figures against nonmedia defendants was posed for decision in Rodriguez v. Nishiki, supra. Initially, we observed "it is now generally recognized, at least with regard to defamation actions involving public officials and public figures, that the New York Times standard of actual malice is applicable to both media and nonmedia defendants." Id. at 436, 653 P.2d at 1149 (citations omitted). We further sensed a denial of this strategic protection to nonmedia defendants "would result in the anomalous situation where media defendants, with a greater capacity for damaging an individual's reputation because of their wide dissemination of information, would be accorded greater rights than other speakers in society." Id. at 437, 653 P.2d at 1149. And the Supreme Court, we noted, "while not articulating a standard explicitly applicable to nonmedia defendants, has made no distinction between media and nonmedia defendants and has further abandoned the traditional dichotomy between libel and slander actions. See e.g., St. Amant v. Thompson, 390 U.S. 727 [88 S. Ct. 1323, 20 L. Ed. 2d 262] (1968) (televised speech); Garrison v. Louisiana, 379 U.S. 64 [85 S. Ct. 209, 13 L. Ed. 2d 125] (1964) (press conference); New York Times v. Sullivan, supra (editorial advertisement)." Id. at 437, 653 P.2d at 1149-50. Our conclusion therefore was that the "actual malice" standard "should be applied without regard to the publisher's designation as a `media' or `nonmedia' defendant." Id.
3.
Whether the plaintiffs were obliged to present "clear and convincing proof that the defamatory falsehood was made with knowledge of its falsity or with reckless disregard for the truth," Gertz v. Robert Welch, Inc., 418 U.S. at 342, 94 S.Ct. at 3008, in order to avoid the grant of summary judgment to the defendants was another question raised in Rodriguez v. Nishiki, supra. Though mindful that some courts have departed from normal summary judgment procedure and have awarded summary judgments to defendants after evaluating all the evidence "in its most reasonable light" and finding the plaintiffs have not demonstrated actual malice "with convincing clarity," we concluded this departure from the norm was not justified. Rodriguez v. Nishiki, 65 Haw. at 438-40, 653 P.2d *321 at 1150-51. We chose to adhere to the apparent majority view which finds expression in Nader v. de Toledano, 408 A.2d 31 (D.C. Cir.1979), cert. denied, 444 U.S. 1078, 100 S. Ct. 1028, 62 L. Ed. 2d 761 (1980), to this effect:
The question to be answered by the trial court must and will remain the same Is there a genuine issue of material fact from which a reasonable jury acting reasonably could find actual malice with convincing clarity? Thus, the court examines the evidence, taking all permissible inferences and resolving questions of credibility in plaintiff's favor to determine whether a reasonable jury acting reasonably could find actual malice with convincing clarity. The question to be resolved at summary judgment is whether plaintiff's proof is sufficient such that a reasonable jury could find malice with convincing clarity, and not whether the trial judge is convinced of the existence of actual malice.
Id. at 50 (emphasis in the original). Our conclusions in this regard were:
If there is a factual dispute about defendant's state of mind with regard to actual malice, summary judgment should not be granted. As the Supreme Court recently noted in Hutchinson v. Proxmire, 443 U.S. 111, 120 n. 9 [99 S. Ct. 2675, 2680 n. 9, 61 L. Ed. 2d 411] (1979), "[t]he proof of `actual malice' calls a defendant's state of mind into question, New York Times Co. v. Sullivan, 376 U.S. 254 [84 S. Ct. 710, 11 L. Ed. 2d 686] (1964) and does not readily lend itself to summary disposition."
Other than the higher standard of proof which the plaintiff must carry as a matter of law, the normal summary judgment procedure should be followed in "actual malice" defamation actions.
Rodriguez v. Nishiki, 65 Haw. at 439, 653 P.2d at 1151.
B.
Having set forth these governing precepts, we embark on an examination of the circuit court's award of summary judgments to the media defendants other than the Valley Isle, reserving for subsequent discussion the grant of summary judgment to Representative Kamalii because of the possibility that legislative incumbency may also have freed her from being called to account for her utterances.
At the outset we note there is no question that Mehau and Kealoha are plaintiffs whose recovery of damages from the defendants is conditioned upon a showing of "actual malice." We further observe there are substantial differences between the relevant conduct of UPI and the actions of the other media defendants calling for a separate consideration of UPI's possible liability for defamation damages from that faced by the others. UPI's putative accountability is addressed first.
1.
The circuit court's summary judgment awards in favor of all the media defendants except the Valley Isle display a keen appreciation of one of the societal values implicated in a defamation suit of this nature, "[t]he need to avoid self-censorship by the news media." Gertz v. Robert Welch, Inc., 418 U.S. at 341, 94 S.Ct. at 3007. We do not deprecate the court's concerns with respect to the necessity for free debate on public issues. Still, we are unable to affirm the award of summary judgment to UPI, for there is evidence in the record from which a jury could find the news service acted with reckless disregard for the truth in transmitting the stories that named Mehau as "the `Godfather' of Hawaii's underworld crime."
The record manifests the two UPI dispatches did more than report the publication of a sensationalized article about the disappearance of George Helm, Jr. and a companion while engaged in a protest against the use of Kahoolawe as a target island by the military. To be sure, the wire service releases consisted mostly of "quotes" allegedly drawn from the Valley Isle story, including several ascribed to Adolph Helm. But the purported "quotes" were strung together in a fashion that focused on Mehau as the "Godfather" of the underworld of local crime. And by innuendo and inference the dispatches further implicated Mehau in the death of George *322 Helm, Jr., linked Mehau with "the mainland syndicate," and involved him in "all the corruption that was happening." Moreover, where the Valley Isle described one occasion on which Helm had purportedly been threatened by Mehau and Kealoha, the wire service quoted George Helm, Sr. as saying his son had been "repeatedly threatened." Any of the foregoing accusations, if untrue, concededly were defamatory.
The case law of pertinent First Amendment litigation in the Supreme Court renders it clear
that reckless conduct is not measured by whether a reasonably prudent man would have published, or would have investigated before publishing. There must be sufficient evidence to permit the conclusion that the defendant in fact entertained serious doubts as to the truth of his publication.
St. Amant v. Thompson, 390 U.S. at 731, 88 S.Ct. at 1325. See also Curtis Publishing Co. v. Butts, 388 U.S. 130, 153, 87 S. Ct. 1975, 1990, 18 L. Ed. 2d 1094 (1967); Garrison v. Louisiana, 379 U.S. at 74, 85 S.Ct. at 215. UPI asserts in defense of its publication of the defamatory material that Dennis Stone, the reporter responsible therefor, "had no serious doubts concerning their truth of the charges, and he was not aware of any facts which raised any reasonable question as to their validity." It further claims he "had no serious concern as to the reliability of [t]he Valley Isle" and if "the charges were distorted in Stone's stories, his errors were completely unintentional." Yet, the relevant teachings of the Supreme Court are that
[t]he defendant in a defamation action brought by a public official cannot, however, automatically insure a favorable verdict by testifying that he published with a belief that the statements were true. The finder of fact must determine whether the publication was indeed made in good faith. Professions of good faith will be unlikely to prove persuasive, for example, where a story is fabricated by the defendant, is the product of his imagination, or is based wholly on an unverified anonymous telephone call. Nor will they be likely to prevail when the publisher's allegations are so inherently improbable that only a reckless man would have put them in circulation. Likewise, recklessness may be found where there are obvious reasons to doubt the veracity of the informant or the accuracy of his reports.
St. Amant v. Thompson, 390 U.S. at 732, 88 S.Ct. at 1326 (footnote omitted).
From a review of the record, we can only conclude "there is a factual dispute about defendant's state of mind with regard to actual malice." Rodriguez v. Nishiki, 65 Haw. at 439, 653 P.2d at 1151. UPI's treatment of the information gleaned from another source, the fact that the source was a new publication apparently given to sensationalizing the "news," and the anonymity of the authors of some of the crucial accusations published by the Valley Isle are a few of the factors we believe could lead to a finding by a jury that UPI's republication of the charges of criminality was not "made in good faith" or they were such that "only a reckless man would have put them in circulation." St. Amant v. Thompson, 390 U.S. at 732, 88 S.Ct. at 1326.
2.
The two news releases transmitted over the UPI wire were received by the Tribune-Herald and republished with a few minor changes and the addition of two paragraphs to the second release that did not materially alter their content. The plaintiffs urge the Tribune-Herald's culpability under these circumstances cannot be distinguished from that of the wire service. We disagree.
The Tribune-Herald was a subscriber to one of the leading news services in the United States; it had no reason to question the reliability of the organization as a news gatherer. Plaintiffs nonetheless would have us impose a duty of prior investigation upon the Tribune-Herald. A clearer inducement than this to the media self-censorship decried by the Supreme Court would be difficult to conjure.
*323 The record indicates the Hilo newspaper made unsuccessful attempts to reach Mehau for comment when the dispatches were received and the story appearing in its June 17, 1977 issue noted these efforts to seek a response to the charges. Other than this, what appeared in the Tribune-Herald's articles was what UPI had transmitted. The newspaper neither slanted nor embellished what was taken off the wire, and the record is barren of any indication that its publication of the stories did not constitute "good faith" reporting of news of substantial public interest. No basis for a possible jury finding that there was a reckless disregard for the truth appears.
While the plaintiffs may have been defamed, the First Amendment exacts a high price from possible victims of defamatory falsehood who hold public office. Gertz v. Robert Welch, Inc., 418 U.S. at 342, 94 S.Ct. at 3008. We think the Tribune-Herald was entitled to rely on UPI's reputation as a reliable source of news. See Waskow v. Associated Press, 462 F.2d 1173, 1176 (D.C. Cir.1972); Gay v. Williams, 486 F. Supp. 12, 16-17 (D.Alaska 1979). Otherwise, it may be reduced to an organ reporting news of Hilo and the Big Island.
3.
We are also of the opinion that the record is devoid of evidence from which a jury may infer there was a reckless disregard for the truth in the reporting of the public dispute fanned by the Valley Isle on the part of other elements of the news media.
KGMB-TV probably was the member of the electronic media giving the controversy the widest coverage; its reporting of the incriminatory charges flung by the Valley Isle extended over a period of eight days. Naturally, the reports all named Mehau as the putative "Godfather." But the station also invariably identified the source of the charge as the article in the Maui tabloid. Furthermore, the repeated statements regarding Mehau's reputed leadership of the underworld were aired in connection with other comments and views on the controversy, particularly those expressed by public officials and figures. For example, the June 15 newscast focused on Representative Kamalii's reproof of the Governor and the Chairman of the State board on which Mehau served for coming to Mehau's defense. And the telecast of June 22 was devoted for the most part to Protect Kahoolawe Ohana and the organization's defense of Mehau and criticism of the Valley Isle's "yellow journalism."
The entries of the remaining media defendants, the Star-Bulletin, KHVH, and KITV (a newspaper, a radio station, and a television station respectively) into the then raging controversy came relatively late. Their involvement began with reports of the Governor's reaction to the Valley Isle and UPI stories, and their coverages of the dispute that had engendered much public interest were largely confined thereafter to reporting the reactions of others. Thus they also aired the statement of the Chief of Police of Maui County, the reactions of Representative Kamalii and Mayor Fasi of the City and County of Honolulu to the Governor's defense of Mehau's character, and the views expressed by other public figures and organizations relative to Mehau, the Governor, and the Valley Isle.
Viewing the evidence presented to the circuit court in the most favorable light for plaintiffs, we still arrive at a conclusion that a jury could not reasonably find actual malice with convincing clarity where the actions of KGMB-TV, the Star-Bulletin, KHVH, and KITV are concerned; the recklessness demanded by New York Times Co. v. Sullivan, supra, just does not appear.
III.
Turning from the claims against the media defendants to the claim against the lone nonmedia defendant, we reiterate at the outset that when defamation actions are brought by public officials the "actual malice" standard is applicable "without regard to the publisher's designation as a `media' or `nonmedia' defendant." Rodriquez v. Nishiki, 65 Haw. at 437, 653 P.2d at 1150. And in this case, the nonmedia defendant's liability for damages may also hinge upon *324 the context within which the defamation occurred.
A.
Representative Kamalii's involvement in the public debate on Mehau's character, as we observed, antedated the publication of defamatory material by the Valley Isle. She plunged into the controversy surrounding his purported Jekyll-Hyde personality by introducing two resolutions in the State House of Representatives shortly after KHON-TV first reported the overlord of local crime also sat on an important public board. But her direct reference to Mehau as the "Godfather," came after the close of the 1977 legislative session and the demise of the resolutions,[9] and at a meeting of the Kailua Chamber of Commerce. Still, we have said there are no temporal and spatial limitations on the immunity from suit afforded by Article III, § 7 of the State Constitution.[10]See Abercrombie v. McClung, 55 Haw. 595, 600, 525 P.2d 594, 597 (1974). The question then is whether accusations that were not hurled in a legislative setting were nonetheless made "in the exercise of ... [Representative Kamalii's] legislative function[s]." Id.
The legislator claims "any statements allegedly made by ... [her] with respect to the `Godfather' of the Hawaii criminal syndicate" were absolutely privileged since they "were made in clarification of House Resolutions Nos. 292 and 293 which were subject matter of legitimate legislative concern." She maintains the remarks were uttered in the exercise "of her legislative function ... to keep the public informed and to serve the public interest." It cannot be denied that crime in Hawaii and its perpetrators are matters of prime legislative concern and informing the public of legislative proceedings would further the public interest. Nevertheless, we hesitate to affirm the award of judgment to Representative Kamalii on the basis of the record presented. For what little there is in the record relative to the statements and the settings in which they were made tells us we are not confronted with a situation like that in Abercrombie v. McClung, supra.
The allegedly slanderous statement by Senator McClung was passed in an interview conducted in his legislative office a few hours after a speech on the floor of the Senate in which he discussed the University of Hawaii and its faculty. In our decision we reviewed the history of the pertinent immunity clause and found the intent of the delegates to the Constitutional Convention of 1950 was to extend broad immunity to legislators. But we recognized the immunity was only effective "for any statement made or action taken in the exercise of ... legislative functions." See Hawaii Const. art. III, § 7. And the actual scope of the privilege, we concluded, was left to judicial determination "on a case by case basis." Abercrombie v. McClung, 55 Haw. at 600, 525 P.2d at 597.
That Senator McClung's erroneous statement of fact regarding Plaintiff Abercrombie's involvement in an activity condemned earlier on the Senate floor was in the exercise of the Senator's legislative functions is beyond cavil. But here, an immunizing nexus between Representative Kamalii's legislative tasks and her identification of Mehau as the "Godfather" of local crime is not so readily discernible. The averred slander occurred after the adjournment of the legislative session in which the *325 two resolutions stimulated by Scott Shirai's expose were introduced; the session's closing also marked the demise of the proposals for legislative policy declarations. And a crucial defamatory remark ascribed to the defendant came in a speech purportedly delivered to a group of Windward Oahu businessmen by a lawmaker whose constituency resided in Waikiki and Kapahulu.
We would be remiss if we were to agree with the circuit court on the skimpy record proffered for review that the legislator undisputably was performing a legislative function rather than a partisan political chore as plaintiffs contend. For the facts uncovered thus far, viewed in a most favorable light for plaintiffs, do not lead to an inescapable conclusion that the post-session remarks of the representative were constitutionally privileged. "[S]ummary procedures present a treacherous record for deciding issues of far-flung import; and ... it is part of good judicial administration to withhold decision of the ultimate questions ... until the record presents a more solid basis." State v. Zimring, 52 Haw. 472, 476, 479 P.2d 202, 204-05 (1970) (citation omitted).
B.
Having decided the award of summary judgment premised on the claimed privilege was not justified, we turn to the question of whether "there is a [remaining] factual dispute about ... [the legislator's] state of mind with regard to actual malice." Rodriguez v. Nishiki, 65 Haw. at 439, 653 P.2d at 1151.
When the Valley Isle article appeared, Representative Kamalii apparently pounced on it as a reason for publicly characterizing Mehau as an arch criminal.[11] Yet in the interview published in a later issue of the tabloid, she equivocated when a specific question about Mehau was put to her. Her response was "I can't say that he is the `godfather' or that he isn't the `godfather'."[12] If her basis for circulating the "name" of the "Godfather" was the Valley Isle story, the factors and considerations that could render UPI liable for defamation could likewise lead to a finding by a jury that only a reckless person would have put the "name" in circulation. See St. Amant v. Thompson, 390 U.S. at 732, 88 S.Ct. at 1326.
IV.
The decision to set aside the summary judgment awarded Representative Kamalii compels our consideration of the issue raised in her cross-appeal, whether the circuit court abused its discretionary authority when it foreclosed the attempt to obtain discovery of evidence in the records of the Honolulu Police Department that purportedly would "support her defense of truth."
*326 A.
Representative Kamalii initiated her discovery efforts by serving a notice of deposition and a subpoena duces tecum upon the Custodian of Records of the Honolulu Police Department. When this failed to yield evidence considered material to her defense, she caused a subpoena duces tecum to be served on the Chief of Police, directing the Chief or an authorized subordinate to produce "any and all documents, records, reports, and/or memoranda of or relating to" Mehau and a number of other persons. The Corporation Counsel of the City & County of Honolulu (the City) responded; he informed defendant's counsel by letter that the Police Department would "not be able to comply with the subpoena ... without a court order delineating the protection that the Police Department requires for its documents." He suggested instead the filing of a motion to compel discovery so the circuit court could properly limit discovery "to relevant matters not otherwise privileged." An order compelling discovery was subsequently entered on defendant's motion.
Rather than advising compliance with the order, the Corporation Counsel acting on the City's behalf then moved for a reconsideration of the circuit court's decision, asserting the records sought by the defendant were "protected under the privileges contained in Tighe v. City and County of Honolulu." The motion was supported by an affidavit of the Chief of Police stating inter alia that a release of the documents would disclose the identities of persons who supplied information on assurances that their names would not be revealed. The court agreed that the records were privileged, and an order granting the motion for reconsideration and denying the motion to compel discovery was entered. The denial of discovery was appealed to this court by the defendant after plaintiffs' interlocutory appeal from the summary judgments was allowed by the circuit court.
B.
The Hawaii Rules of Civil Procedure, like the federal procedural rules, reflect a basic philosophy that a party to a civil action should be entitled to the disclosure of all relevant information in the possession of another person prior to trial, unless the information is privileged. Kalauli v. Lum, 1 Haw. App. 284, 287, 617 P.2d 1239, 1241 (1980); Rule 26 HRCP; 8 C. Wright & A. Miller, Federal Practice and Procedure § 2001, at 15 (1970). Citing Tighe v. City & County, 55 Haw. 420, 520 P.2d 1345 (1974), and Rule 510 of the Hawaii Rules of Evidence,[13] the City argues the information sought by the defendant is indeed privileged. It maintains the documents sought by defendant contain information gathered in an ongoing police investigation and their release may jeopardize the probe as well as reveal identities that should be kept inviolate.
In Tighe we acknowledged "[i]t has generally been held that there should be no absolute governmental privilege insulating police records from discovery ... in the absence [of a] specific statute granting such a privilege." Id. at 422, 520 P.2d at 1346-47. Although we found no such statute, we said the "[p]ublic interest in preservation of confidentiality and secrecy may be sufficient reason for insulation of police or other governmental records from discovery in special, individual cases." Id. But we further held the "claims of privilege for such records on this basis require documentation and argument by the governmental agency asserting the privilege, and subsequent judicial evaluation of the claim[s]." Id.
*327 Representative Kamalii argues the circuit court erred in upholding the City's assertion of privilege because the requisite documentation was lacking. She also contends the circuit court's failure to conduct an in camera inspection of the records in question prior to ruling constituted an abuse of discretion. The City counters with a proposition that the affidavit of the Chief of Police adequately corroborated its claim that the public interest in law enforcement outweighed the defendant's interest in obtaining discovery and there was no need for an in camera look at the records.
The "pendency of a criminal investigation is a reason for denying discovery of investigative reports," Swanner v. United States, 406 F.2d 716, 719 (5th Cir.1969), and the circuit court may well have been dealing with a "special, individual case" where there was "reason for insulation of police ... records from discovery." Tighe v. City & County, 55 Haw. at 422, 520 P.2d at 1346-47. Yet the privilege is seldom one of indefinite duration, for the underlying inquiry usually has "a reasonable terminus." Capitol Vending Co. v. Baker, 35 F.R.D. 510, 511 (D.D.C. 1964). Thus the passage of time since the circuit court's ruling may have altered the circumstances, and a current evaluation of the City's claim of privilege would best serve the interests of all concerned, as well as judicial economy.[14]
The summary judgments in favor of the Star-Bulletin, the Tribune-Herald, KGMB-TV, KITV, and KHVH are affirmed; the summary judgments in favor of UPI and Representative Kamalii are set aside. The case is remanded for further proceedings consistent with this opinion.
TSUKIYAMA, Circuit Judge, concurring and dissenting.
I concur as to all Defendants except Hawaii Tribune Herald, Ltd. (HTH). In my view, the same issue of fact exists as to the "good faith" of both UPI and HTH in publishing patently defamatory statements.
I subscribe to the majority opinion's thoughtful analysis of the legal precepts which govern the disposition of the issues herein. However, it is my opinion that in a summary judgment setting there are other considerations which must be specifically addressed and emphasized in balancing First Amendment guarantees against the right of an individual to privacy and protection against defamatory lies. These considerations require a reversal as to HTH.
The mandate of New York Times Co. v. Sullivan, 376 U.S. 254, 84 S. Ct. 710, 11 L. Ed. 2d 686 (1964), is that the public interest which is subserved by the First Amendment requires the courts to shield any person or the established media from liability for defamatory lies about a public official unless the official defamed can establish with convincing clarity that the defamatory lies were made with "`actual malice' that is, with knowledge that it was false or with reckless disregard of whether it was false or not." Id. at 280, 84 S.Ct. at 726. The essence of "reckless disregard" is "good faith." St. Amant v. Thompson, 390 U.S. 727, 88 S. Ct. 1323, 20 L. Ed. 2d 262 (1968).
The qualification of "good faith" reflects a modicum of protection for the individual public official which the Times rule allows in recognition of the rights of the public official as an individual. The distinction between the public official as a public servant and as an individual was aptly expressed in the dissenting opinion in St. Amant v. Thompson, supra, and repeated in Tagawa v. Maui Publishing Co., 50 Haw. 648 at 655, 448 P.2d 337 (1968).
The occupation of public officeholder does not forfeit one's membership in the human race.
In applying the Times rule in a summary judgment setting, we must recognize that this rule does not confer upon any person or the established media a license to publish *328 defamatory lies about a public official. Neither Times nor its progeny would hold that the First Amendment immunizes any person or the established media from civil liability for defamation. Nowhere is it suggested, and certainly we should not conclude, that Times requires the courts to place a premium upon reckless lies to ensure the ascertainment of truth or to presume that the public is interested in or benefits from such defamatory lies about the personal qualities and activities of public officials.
In the process of balancing First Amendment guarantees against the rights of a public official as an individual, we must be mindful of the existence of public interests which compete with the particular interest which is protected by the Times rule. It is axiomatic that the public interest is subserved by uninhibited, robust and wide-open debate on public issues and officials and that the dissemination of erroneous information must be protected as a concommitant of such debate. On the other hand, the public interest is also subserved by the recruitment and retention of competent public officials and by the ascertainment of truth.
A public official is not stripped of his private identity and integrity by virtue of his office. To expose an individual to reckless and vicious defamatory lies of a personal nature without providing any remedy therefor or an opportunity for vindication, merely because the individual provides a few hours of uncompensated service to the public, would effectively discourage any sensible, highly qualified individual from consenting to public service. The absence of such individuals from public service clearly would be contrary to the public's best interest.
We must be sensitive also to the public's interest which is subserved by the ascertainment of the truth. A summary judgment against a public official in a defamation action terminates the legal proceeding which is intended to provide the parties with an opportunity of demonstrating, and the public of determining, the truth or falsity of the defamatory matter published. It thereby precludes the ascertainment of truth and deprives the public of any basis for the vindication or condemnation of the public official. Unless there is clearly no genuine issue of material fact for consideration by a jury, a summary judgment in a defamation action merely creates doubt and suspicion and subserves neither the interest of the public nor the public official.
In imposing limitations upon First Amendment guarantees, the established media cannot be held to the standard of an insurer of the truth of everything that it publishes. Such an obligation would effectively stifle the First Amendment. However, the imposition of a "good faith" requirement in the publication of defamatory statements about the personal qualities or activities of a public official does not have the effect of suppressing the kind of debate on public issues and officials which would subserve the public's interest. St. Amant v. Thompson, supra. But, a summary judgment against a public official in a defamation action definitely would have the effect of suppressing, and encouraging speculation and distortions about, the truth. Depending on the facts of each case, the limitation which the "good faith" requirement places upon First Amendment guarantees may indeed be de minimus as compared to the irreparable loss to the public resulting from the suppression of the truth and the irreparable injury to the public official.
In light of the foregoing considerations, it is my opinion that the majority opinion's analysis, which leads to the conclusion that there is a genuine issue of fact as to UPI, applies to HTH.
In determining whether there is a genuine issue of fact as to the "good faith" of HTH, the Court must address the question of whether the statements published "are so inherently improbable that only a reckless man would have put them in circulation" St. Amant v. Thompson, 390 U.S. at 732, 88 S.Ct. at 1326. See also Goldwater v. Ginzburg, 414 F.2d 324 (2nd Cir.1969) cert. denied, 396 U.S. 1049, 90 S. Ct. 701, 24 L. Ed. 2d 695 (1970).
*329 On June 16, 1977, HTH published a virtually word-for-word account of the UPI story which was released on June 15, 1977. HTH added the story headline "Godfather Named." HTH made several unsuccessful attempts to contact Mehau prior to its publication of the initial UPI story.
The story headline composed by HTH could be construed as implying that there existed a "godfather" and that the story merely identified him. The story contained no basis for this implication and there was no indication that the persons making the charge had any facts or personal knowledge relative thereto. There can be no question of the seriousness of the statements made in the publication and of their public importance. Neither is there any question of the patently defamatory nature of the allegations and the irreparable injury it would cause a public official if untrue. Moreover, if untrue, such allegations would serve no better purpose than to recklessly undermine the public's confidence in its public officials and government generally. The public's interest is not subserved by the erosion of the public's confidence in its government officials as a result of defamatory lies.
Given what appears to be the circumstances surrounding the initial dissemination of the UPI story, there appeared to be no basis for the urgent publication of the story. It does not appear that a responsible investigation of the allegations prior to its publication would have jeopardized the public's interest. Indeed, given the nature of the allegations, the public's interest in the truth thereof, and the individual's right against defamatory lies, the public's interest would have been subserved only by a responsible and balanced presentation of the allegations and the facts pertinent thereto.
The UPI story identified Mehau as a member of the State Land Board and thereby must have alerted HTH that he held a position of public trust. In light of the serious and patently defamatory nature of the UPI story, and the position of public trust held by the subject, a jury could find that the allegations were "inherently improbable" and that there was an obvious basis for doubting the veracity thereof.
HTH asserted that it relied entirely upon UPI for the accuracy of the story and that it had no reason to doubt its accuracy. Even if these assertions were true, such reliance and belief would not preclude a finding by a jury of "actual malice," i.e. that the defamatory allegation was made with reckless disregard of its truth or falsity. Similar assertions were responded to in Goldwater v. Ginzburg, supra.
Reliance upon newspaper articles ... and upon accurate reprinting of another's letter are only factors which, with other factors, are probative of whether the publisher of the cumulated material was motivated by actual malice when he caused the full material to be published. Repetition of another's words does not release one of responsibility if the repeater knows that the words are inherently improbable, or there are obvious reasons to doubt the veracity of the person quoted or the accuracy of his report. Id. at 337.
In the circumstance surrounding HTH's publication of the initial UPI story, I believe that there exists a factual dispute as to whether the HTH publication was made with "actual malice," and further that a reasonable jury acting reasonably could find "actual malice" with convincing clarity.
I would reverse and remand as to HTH.
NOTES
[*] Chief Justice Richardson, who heard oral argument in this case, retired from the court on December 30, 1982. HRS § 602-10 (1979 Supp.) provides: "After oral argument of a case, if a vacancy arises or if for any other reason a justice is unable to continue on the case, the case may be decided or disposed of upon the concurrence of any three members of the court without filling the vacancy or the place of such justice."
[1] The defendants include Gannett Pacific Corporation, a Delaware corporation, dba Honolulu Star-Bulletin (the Star-Bulletin); Lee Enterprises, Inc., a Delaware corporation, dba KGMB-TV (KGMB-TV); Hawaii Tribune-Herald, Ltd., a Nevada corporation, dba Hawaii Tribune-Herald (the Tribune Herald); Western Telestations, Inc., a Wyoming corporation, dba KITV (KITV); KHON-TV, Inc., a Delaware corporation, dba KHON-TV (KHON-TV); KHVH, Inc., a Hawaii corporation, dba KHVH Radio (KHVH); United Press International, a New York corporation (UPI); and the Valley Isle Publishers, a Hawaii corporation which published the Valley Isle (Valley Isle).
[2] The legislator is Kinau Boyd Kamalii who was then a member of the State House of Representatives.
[3] However, KHON-TV and Scott Shirai, the newscaster responsible for the story, have been dismissed from the suit as a result of a settlement effected between themselves and the plaintiffs. See Record on Appeal, at 1034.
[4] The Valley Isle, now defunct, was then a bi-weekly tabloid published on Maui which had a normal press run of twelve thousand copies. It had begun publishing shortly before then and was distributed without charge to readers.
[5] The late George Helm was a leader in the native Hawaiian movement who had disappeared while participating in a protest against the use of the island of Kahoolawe as a target island by the military.
[6] The lengthy story that appeared in the June 15 issue of the paper was composed of purported interviews of several anonymous persons and Adolph Helm. This statement was among those ascribed to Helm:
George was doing a heavy trip looking into organized crime. George was wide open. He came out publicly in front of maybe 100 people and named Larry Mehau as the "godfather." And he named people higher up. He said he was going to expose them and all the corruption that was happening.
The article also displayed statements attributed to persons who desired anonymity in prominent boxes. The following appeared in one of them:
Valley Isle: What did you see?
A: I saw Larry Mehau come in with Mokiki Kealoha (both of the State Department of Land and Natural Resources). I thought they were probably coming in to tap the owner.
Valley Isle: What do you mean, `tap'?
A: Hit up for protection money.
Valley Isle: Why would you think that? Are Mehau and Kealoha supposed to be syndicate or something?
A: Sure, everybody knows that.
Valley Isle: What did they want?
A: They talked to George. After they left, somebody asked George what they wanted.
He said, `They told me to cool it, or else.'
There were other statements linking Mehau with criminal elements here and elsewhere.
[7] The story first disseminated over its wire by UPI read:
Adolph Helm ... brother of the missing Hawaiian activist George Helm ... was quoted today in the biweekly Valley Isle Press as naming State Land Board Big Island member Larry Mehau as the "Godfather" of Hawaii's underworld crime. Adoph [sic] Helm also was quoted as reveling [sic] that his brother, now feared dead, said Mehau threatened him when Helm was a musician at Honolulu's Gold Coin Restaurant. The Helm brothers' father confirmed that George Helm said he was repreatedly [sic] threatened. Before he apparently died, George Helm told his brother he had a lot to reveal about Hawaii's organized crime. Adolph Helm also reportedly fingered Marcus Lipske, believed the manager of singer Don Ho, as the local underworld's link with the mainland syndicate.
[8] The second release read:
Adolph Helm, the brother of the missing and feared dead Hawaiian activist George Helm, revealed today that George Helm told many of his followers that State Board of Land and Natural Resources member Larry Mehau of the Big Island is the godfather of Hawaii's underworld. Helm, interviewed at his Molokai residence said his brother told 40 to 50 people prior to a March `invasion' of Kahoolawe that Mehau and other people Quote `higher up' were deeply involved in organized crime. Helm quoted his brother as saying he was planning to expose them and `all the corruption that was happening.' Helm's apparent death this past March is believed being investigated by Maui County and the F.B.I.
[9] Although Article III, § 15 of the State Constitution provides that "[a]ny bill pending at the final adjournment of a regular session in an odd-numbered year shall carry over with the same status to the next regular session," there is no provision that extends the viability of resolutions beyond the adjournment of the session in which they are introduced.
[10] Article III, § 7 of the State Constitution reads:
No member of the legislature shall be held to answer before any other tribunal for any statement made or action taken in the exercise of the member's legislative functions; and members of the legislature shall, in all cases except felony or breach of the peace, be privileged from arrest during their attendance at the sessions of their respective houses, and in going to and returning from the same.
[11] The plaintiffs aver Representative Kamalii made the following statements at the Kailua Chamber of Commerce meeting:
I have just been informed that Adolph Helm has released the "name" on Maui and therefore I will tell you here. The name is that of big island rancher Larry Mehau.
[12] The story published in the Valley Isle consisted of a series of questions put to Representative Kamalii and her responses thereto, including these:
Valley Isle: You had information that Mehau was involved in organized crime before this time?
Kamalii: Well, let me put it this way: When I called for investigation of Scott Shirai's charges (that the "godfather" sits on a State Board), the only name that people whispered in the halls was Larry Mehau. Without any evidence to really pin it on him, of course. But the people saying his name were elected officials and reporters and responsible people on the street. But there was no concrete proof that this is so. That's what makes it extremely difficult.
Valley Isle: That's why you haven't mentioned his name?
Kamalii: Right. Just naming the name is wrong. However, I do know many people are being investigated. To put this together you can talk to some of the police officers and so on and so forth and find that he is known to have been seen with underworld people. But it's hard to get a lot of people to talk. You get the birds flocking together situation. So I can't say that he is the "godfather" or that he isn't the "godfather." But that is the only name that I have ever heard in that context.
[13] Rule 510, Haw.R.Evid., provides in part:
(a) Rule of privilege. The government or a state or subdivision thereof has a privilege to refuse to disclose the identity of a person who has furnished information relating to or assisting in an investigation of a possible violation of law to a law enforcement officer or member of a legislative committee or its staff conducting an investigation.
Although this evidentiary rule iterates a privilege not to disclose the identities of persons furnishing information on law violations, it governs the use of such information at trial. Since the issue before us is related to pre-trial discovery, we do not reach the question of the applicability of Rule 510 here.
[14] Though the circuit court is vested with discretion in this matter, we would not consider any decision to conduct an in camera inspection of records an abuse of discretion.
We also believe such an inspection would put the circuit court in a better position to fashion protective orders where the interests of justice require. | 01-03-2023 | 10-30-2013 |
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